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Creative Peripherals & Distribution Ltd.

BSE: 538414 Sector: Others
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Creative Peripherals & Distribution Ltd. (CREATIVE) - Chairman Speech

Company chairman speech

Dear Members and Stakeholders

It gives me great pleasure to extend a very warm welcome to each and every one of youto the 13th Annual General Meeting of your company. It is my privilege topresent to you the 13th Annual Report of your company.

Market Trends

In the realm of electronics the space which we are focusing the boundaries areblurring between enterprise and end customer. Today innovation is happening more on theuser experience side people are harnessing the power of artificial intelligence to usemillions of data points to get insights and solutions so that they can offer solutions toend customer which is only possible on enterprise side we have non- conventionalcompanies making inroads in this space. Companies like Amazon Google and GoPro all havebought fantastic innovative products whereas there background was never product hardwaredevelopment. Today product is no longer a differentiator along with the product yourequire content and community around it. As more and more products role out to this offersthe role of the partners becomes very important who can execute brands vision at theground level. Also you require a partner who is able to give the same user experience atall touch points and be closer to the customer. Your company today is one of the bestsuited company with these capabilities and is a preferred India market entry partner forbrands. GST has been rolled out in India and it will change the complete supply chainscenario in the country in the long term. It will reduce the overall expense ofdistribution companies considerably your company will be benefited to a large extent dueto this and also it will help us to expand to areas where we are not present currently inIndia

Overview of the Company:

Founded in August 1992 and incorporated on 22nd September 2004 as privatelimited and completed its 25 years of journey today we are market entry and penetrationspecialist in the following categories of products IT Imaging Lifestyle and Securityproducts. The registered office of our Company is situated at Borivali Mumbai. We alsooperate out of our 26 branches in the leading cities covering the geographical territoriesof the country.

The turnover achieved of Rs. 21095.40 lakhs during the financial year 2016-17 ascompared to turnover of Rs. 19862.29 lakhs during the financial year 2015-16.

Engaged in distribution business your Company has partnered with a number of renownedbrands for distribution in the country such as Adata Technology Co Limited RapooTechnologies Limited CISCO Consumer Products PTE Limited Nedis BV Lino Manfrotto + CoS.p.a Transcend Information Inc ViewSonic International Corporation OlympusCorporation Belkin Inc Zioncom (Hong Kong) Technology Limited TPV Technology IndiaPrivate Limited Apple India Private Limited Sennheiser Electronics India PrivateLimited Gopro Cooperatief U.A. and Samsung India Electronics Private Limited specialisingin IT Lifestyle Imaging and Security products. Ours is a broad based distribution modelwhich is based on multiple products and multiple brand strategy. The focus is to capture aconsiderable market share in each of the product categories. This helps us make ouroffering complete to our channel partners. It also spreads our market risks arising out offluctuation in the market shares of various brands besides helping us to achieve economiesof scale.

Our Company operates in the indirect sales model and we play the role of supply chainconsolidator as well as the extension of the Brands between several IT manufacturers andmany IT channel partners. We operate with a dealer network of around 6000 dealers. We acton a principal to principal basis purchasing in bulk from the vendors and further downselling them to resellers/sub-distributors/ system integrators and retailers. We purchasefrom vendors and sell only to channel partners who are typically corporate resellersretailers and systems integrators.

Our volume business require stocking across branches and is working capital intensive.Products which fall in value business segment are typically high end high value products.These are sold as part of entire package to corporates/individuals which would enable themto have a complete IT solution. The selling cycles are longer and many solutions requireproducts from multiple brands. Your Company also provides value added services to vendorsand customers of value businesses segment.

Details of vendors and products distributed by us are given in the following table:

Vendor Product Category
AOC Monitors &TV
BANDRIDGE Cables Headphones
BEATS Headphones
BELKIN Accessories Routers Surge Car Chargers Cooling Pad
GITZO Backpack
GOPRO Cameras
MANFROTTO Tripods Mini Tripods Monopod Backpack
NZXT Cabinets
OLYMPUS Cameras Lenses Binoculars
RAPOO Keyboards Mouse Headphones Power bank
SAMSUNG Monitors
SKYWORTH Television
TOTO LINK Networking products
TRANSCEND Memory Storage
VIEWSONIC Projectors 3D Glass

Over the last couple of years we have plugged gaps in our operating model and intendto continue doing so with the objective to cement out reputation as a one-stop shop. Werecruited more professionals (accountants sales and service teams) to address our growingnumber of clients. We garnered superior margins by moderating our working capital usageand interest outflow. We invested in top-of-the line automation to double our scalewithout incurring any additional investments. We segregated product delivery and resellerengagement touch points to strengthen our understanding of ground realities.

SWOT Analysis

Strengths Opportunities
• Partnership with renowned Brands • Introduction of GST
• Experienced Management • New age of Products
• Wide Range of Products • Increasing digital awareness
• Wide geographical presence • High entry barriers
• Inventory management
Weakness Threats
• High Working Capital cycle • Competition from organised and unorganised players
• Dependency on brand of vendors
• Obsolescence of technology • Termination or non-renewal of Distribution agreement with vendors

We are working to minimise our threats and weaknesses

Ladies and Gentleman before I conclude on behalf of the Board of Directors I wouldlike to thank our Creative team all our customers dealers distributors and otherbusiness associates for their continued support. I sincerely thank all our employees fortheir outstanding effort and commitment. In the era of digital technologies digitizationhelps to change a business model and provide new revenue and value producingopportunities. What is exciting for us as a Company is that we are actually enablingdigital revolution for our businesses society and environment.

Mr. Ketan Patel

Chairman & Managing Director

DIN 00127633

Date: 03rd August 2017

Place: Mumbai.