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Lovable Lingerie Ltd.

BSE: 533343 Sector: Industrials
BSE 13:43 | 19 Jun 141.50 -1.85






NSE 13:32 | 19 Jun 141.00 -2.15






OPEN 143.35
52-Week high 281.00
52-Week low 121.00
P/E 18.57
Mkt Cap.(Rs cr) 209
Buy Price 140.95
Buy Qty 36.00
Sell Price 142.15
Sell Qty 24.00
OPEN 143.35
CLOSE 143.35
52-Week high 281.00
52-Week low 121.00
P/E 18.57
Mkt Cap.(Rs cr) 209
Buy Price 140.95
Buy Qty 36.00
Sell Price 142.15
Sell Qty 24.00

Lovable Lingerie Ltd. (LOVABLE) - Director Report

Company director report



The Members of Lovable Lingerie Limited.

Your Company's Directors are pleased to present the 30th Annual Report of the Companyalong with the audited financial statements for the financial year ended 31st March 2017.

( Rs. in Lakhs)
Particulars 2016-17 2015-16
Revenue from operations 19740.61 19676.84
Operating Expenditure 17804.13 16613.90
Profit Before Interest Tax & Depreciation 1936.48 3062.94
Other Income (net) 607.26 593.16
Finance Costs 84.59 138.77
Profit before Tax and Depreciation 2459.15 3517.33
Depreciation and amortization expense 339.56 280.09
Profit before Extra-Ordinary Item 2119.59 3237.24
Extra-Ordinary Item 398.30 -
Profit before Tax (PBT) 1721.29 3237.24
Provision for Taxation 493.52 919.70
Profit for the year (PAT) 1227.77 2317.54
Surplus brought forward from previous year 7976.51 6078.17
Amount available for appropriation 9204.28 8395.71
Transferred to General Reserve - 115.90
Interim Dividend (excluding tax) - 252.00
Tax on Interim Dividend - 51.30
Proposed Dividend on Equity Share Capital 168.00 -
Corporate Dividend Tax on Proposed Dividend 34.20 -
Adj for Depreciation of prior years pursuant to change in useful life - -
Balance Carried to Balance Sheet 9002.08 7976.51
EPS Basic & Diluted- Before Extraordinary Items (in Rs.) 9.68 13.79
EPS Basic & Diluted- After Extraordinary Items (in Rs.) 7.31 13.79


For the financial year 2016-17 the Company recorded a net turnover of Rs. 19740.61lakhs as against Rs. 19676.84 lakhs for the financial year 2015-16 registering anincrease of 0.32%. The Net Profit Before Tax stood at Rs. 1721.29 lakhs as against Rs.3237.24 lakhs over last year and Profit After Tax stood at Rs. 1227.77 lakhs for theyear as against Rs. 2317.54 lakhs in the last year.


The Company is engaged in the business of manufacturing garments. Therefore there isno separate reportable segment.


On Equity Shares Current Year Ended 31/03/2017
Interim Dividend -
Final Dividend 168.00

The Board of Directors have recommended a nal dividend of 10% on Equity Shares i.e. Rs.1.00 per Equity Share of Rs. 10/- each for the financial year ended on 31st March 2017subject to the approval of Shareholders at the ensuing Annual General Meeting. ThisDividend of Rs. 168.00 Lakhs along with dividend distribution tax of Rs. 34.20 Lakhs willabsorb Rs. 202.20 Lakhs.

The nal dividend if approved at the forthcoming Annual General Meeting (AGM) will bepaid out of the Profits of the Company and the same will be paid to those members whosenames shall appear on the Company's Register of Members as on the Record date and/or theBook Closure date as may be determined by the Board of Directors.


Your Company does not have any subsidiary joint venture or associate Company.


No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which this financial statements relateand the date of this report.


The extract of Annual Return as provided under sub-section (3) of section 92 of theCompanies Act 2013 ('the Act') in prescribed form MGT-9 is enclosed as “AnnexureA” to this report.


Mr. L. Jaipal Reddy (DIN: 01539678) retires by rotation at the ensuing Annual GeneralMeeting and being eligible offers himself for reappointment.

Pursuant to the resolutions passed by the members in their 27th Annual General Meetingheld on 25th September 2014 Mr. Gopal Sehjpal (DIN: 00175975) Mr. AnantharamanMahadevan (DIN: 00165226) Mr. Sivabalan Pandian (DIN: 01573458) and Mr. Dhanpat Kothari(DIN:03032242) hold of ce as Independent Directors of the Company upto the conclusion ofthe ensuing 30th Annual General Meeting (AGM). Appropriate resolutions for there-appointment of Independent Directors being placed for your approval at the ensuingAnnual General Meeting subject to the recommendation of Nomination and RemunerationCommittee and Board at their respective meetings.


For the purpose of selection of any Director the Nomination and Remuneration Committeeidenti es the person of integrity who possess relevant expertise experience andleadership qualities required for the position and also takes into considerationrecommendation if any receives from any members of the Board. The Committee also ensuresthat the incumbent ful lls such other criteria with regard to age and other quali cationsas laid down under the Companies Act 2013 or other applicable laws.

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration.

The Company's policy on directors' appointment and remuneration and other mattersprovided in Section 178(3) of the Act has been disclosed in the corporate governancereport which forms part of the directors' report.


The Company has received declaration from all the Independent Directors of the Companycon rming that they meet with the criteria of independence as prescribed under sub-section(6) of Section 149 of the Companies Act 2013.


The Company has constituted the following committees in compliance with the CompaniesAct2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholders Relationship Committee and

4. Corporate Social Responsibility Committee.

The Board has accepted all the recommendations of the above committee. The briefdescription composition and other required details of the above committees are providedin Corporate Governance Section to this Annual Report.


In compliance of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 (SEBI (LODR) Regulations”) the Company has put in place aFamiliarization Programme for the Independent & Non-Executive Directors to familiarizethem with the Company their roles rights responsibilities in the Company nature of theindustry in which the Company operates business model etc. The details of such programmeis available on the website of the company and may be accessed throughthe web link


The Board of Directors met four times during the year on 30th May 2016; 12th August2016; 11th November 2016 and 14th February 2017. For details of the meetings of theboard please refer to the corporate governance report which forms part of this report.The intervening gap between the Meetings were within the period prescribed under theCompanies Act 2013 and SEBI (LODR) Regulations.


The Board of Directors have carried out an annual evaluation of its own performanceits various committees and individual directors pursuant to the provisions of theCompanies Act 2013 and the Corporate Governance requirements as prescribed underregulation 17(10) 25(4) and other applicable provisions of the SEBI (LODR) Regulations.

The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of various criteria such as Board Composition processdynamics quality of deliberations strategic discussions effective reviews committeeparticipation governance reviews etc.

The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of criteria such as Committee composition processdynamics deliberation strategic discussions effective reviews etc.

The Board and the Nomination and Remuneration Committee reviewed the performance of theindividual directors on the basis of the criteria such as Transparency AnalyticalCapabilities Performance Leadership Ethics and ability to take balanced decisionsregarding stakeholders.

In a separate meeting of independent directors performance of non-independentdirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of the executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting ofindependent directors at which the performance of the Board its committee and individualDirectors was also discussed.


The Company has not made any loans guarantees or investments during the year underreview pursuant to the provisions of Section 186 of the Companies Act 2013.


Your Company has an elaborate Risk Management procedure. Major risks identi ed by thebusinesses and functions are systematically addressed through mitigating actions on acontinuing basis. The Audit Committee reviews the status of key risks and steps taken bythe Company to mitigate such risks at regular intervals.


In line with the requirements of the Companies Act 2013 and SEBI (LODR) Regulationsyour Company has formulated a Policy on Related Party Transactions which is available onCompany's website; web link at ThePolicy intends to ensure that proper reporting approval and disclosure processes are inplace for all transactions between the Company and Related Parties.

All Related Party Transactions are placed before the Audit Committee for review andapproval. Prior omnibus approval is obtained for Related Party Transactions on a yearlybasis for transactions which are of repetitive nature and / or entered in the OrdinaryCourse of Business and are at Arm's Length.

All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. No Material Related Party Transactions were enteredduring the year by the Company. Accordingly the disclosure of Related Party Transactionsas required under Section 134(3) (h) of the Companies Act 2013 in Form AOC 2 is notapplicable.


To create enduring value for all stakeholders and ensure the highest level of honestyintegrity and ethical behaviour in all its operations the company has formulated a VigilMechanism in addition to the existing code of conduct that governs the actions of itsemployees. This Whistle blower policy aspires to encourage all employees to reportsuspected or actual occurrence(s) of illegal unethical or inappropriate events(behaviours or practices) that affect Company's interest / image.

A copy of the Policy is available on the website of the Company and may be accessedthrough the web link



In order to prevent sexual harassment of women at work place a new act The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen noti ed on 9th December 2013.

The Company has adopted a Policy on Prevention Prohibition and Redressal of SexualHarassment at the Workplace to provide protection to women (including outsiders) at theworkplace and for prevention and redressal of complaints of sexual harassment and formatters connected or incidental thereto with the objective of providing a safe workingenvironment where employees feel secure. The Company has also constituted an InternalComplaints Committee to consider and to redress complaints of sexual harassment. TheCommittee has not received any complaint of sexual harassment during the year underreview.


In accordance with the requirements of Section 135 of Companies Act 2013 your Companyhas constituted a Corporate Social Responsibility Committee. The composition terms ofreference and other relevant details of the Corporate Social Responsibility Committee isprovided in the Corporate Governance Report.

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities and expenditure incurredthereon during the year are set out in “Annexure B” of this report in the formatprescribed in the

Companies (Corporate Social Responsibility Policy) Rules 2014. The policy is availableon the website of the Company;weblink


The information required under Section 197 of the Companies Act 2013 read with rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014has been appended as “Annexure C” to this Report.

The information required under Section 197 of the Companies Act 2013 read with Rule5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is not applicable since during the year under review none of the employees of the Companywas in receipt of remuneration in excess of the limits speci ed whether employed for thewhole year or part thereof.


The Board of Directors of the Company con rms that:

in the preparation of the annual accounts for the financial year ended 31st March2017 the applicable accounting standards have been followed and that no materialdepartures have been made from the same;

they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theProfit of the Company for that period;

they have taken proper and suf cient care for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

they have prepared the annual accounts on a going concern basis;

they have laid down internal financial controls for the Company and such internalfinancial controls are adequate and operating effectively; and

they have devised proper systems to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.


The Company has not accepted any deposits covered under Chapter V of the Companies Act2013. Accordingly no disclosure or reporting is required in respect of details relatingto deposits covered under this Chapter.


Your Company's shares are listed in the BSE Limited Mumbai (BSE) and National StockExchange of India Limited Mumbai (NSE) and the annual listing fees have been duly paid.


In conformity with the provisions of Regulation 34(2) of SEBI (LODR) Regulations theCash Flow Statement for the year ended 31.03.2017 is enclosed as a part of this AnnualReport.


The details pertaining to composition of audit committee are included in the CorporateGovernance Report which forms part of this report.


Statutory Auditors

M/s Vinod Kumar Jain & Co. Chartered Accountants (FRN: 111513W) were appointed asStatutory Auditors of your Company at the Annual General Meeting held on 25th September2014 for a period of three consecutive years up to the conclusion of 30th Annual Generalmeeting of the Company subject to rati cation by members at every Annual General Meetingof the Company. As per provisions of Section 139(1) of the Act their term of of ceexpires at the ensuing general meeting.

The Audit Committee and the Board of Directors at its subsequent meeting to be heldbefore the ensuing AGM will consider the proposal for appointment of a new StatutoryAuditor subject to the approval of the members at the ensuing AGM.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hadappointed M/s. D. M. Zaveri & Co. Practicing Company Secretaries Mumbai to undertakethe Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as“Annexure D”.

The auditors' report and secretarial auditors' report for the financial year 2016-17does not contain any quali cations reservations or adverse remarks. Report of thesecretarial auditor is given as an annexure which forms part of this report. The Reportgiven by the Auditors on the financial statements of the Company is part of the AnnualReport.


No signi cant or material Orders were passed by the Regulators or Courts or Tribunalsduring the previous year which may impact the Going Concern Status of the Company'sOperation in the future.


Your Company did not have any unpaid or unclaimed funds lying with the Company for theperiod of seven years. Therefore there were no funds required to be transferred toInvestor Education and Protection Fund (IEPF).

Pursuant to the provisions of the Investor Education Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 theCompany has already led the necessary form and uploaded the details of unpaid andunclaimed amounts lying with the Company as on the date of last Annual General Meeting(i.e. September 24 2016) with the Ministry of Corporate Affairs.


Your Company continues to lay a strong emphasis on transparency accountability andintegrity.

The Companies Act 2013 and the Listing Regulations have strengthened the governanceregime in the country. Your Company is in compliance with the governance requirementsprovided under the new law.

Your Company has in place all the statutory Committees required under the law. Detailsof Board Committees along with their terms of reference composition and meetings of theBoard and Board Committees held during the year are provided in the Corporate GovernanceReport enclosed as “Annexure E” to this report.

The Policy on Related Party Transactions Remuneration Policy CSR Policy and WhistleBlower Policy are available on the website of the Company. The Company has established avigil mechanism for Directors and employees to report their genuine concerns details ofwhich have been given in the Corporate Governance Report annexed to this Report.

A separate report on Corporate Governance is provided together with a Certi cate fromthe Statutory Auditors of the Company regarding compliance of conditions of CorporateGovernance as stipulated under the Listing Regulations. A Certi cate of the CEO and CFO ofthe Company in terms of sub-Regulation 17(8) of the Listing Regulations inter alia conrming the correctness of the financial statements and cash ow statements adequacy of theinternal control measures and reporting of matters to the Audit Committee is alsoannexed.


To avoid duplication between the Directors' Report and the Management Discussion andAnalysis we present below a

composite summary of performance and functions of the Company.


The macro-economic stability of the Indian economy improved in the rst half of thecurrent year weathering global headwinds. Economic growth was supported by good monsoonrains and better crop production and the expansion in Government expenditure due topayouts on account of the Seventh Pay Commission.

Various new initiatives were undertaken in this year as part of the economic reforms ofthe Government which include: the passage of Goods and Service Tax bill the merger ofrailway budget with the general budget to allow for holistic planning and budgeting oftransport infrastructure advancing of the budget cycle by close-to-a-month passage ofthe Insolvency and Bankruptcy Code 2016 formalization of the Monetary Policy Committeeand instituting in ation targeting changes in FDI policy regime with putting a largenumber of sectors on automatic route for FDI.

The prospects for Indian economy for the year 2017-18 need to be assessed in the lightof emerging global and domestic developments. Indications are that global economic growthis gradually picking up.

As per the First Advanced Estimates released by the Central Statistics Of ce theeconomy is estimated to grow at 7.1 per cent in 2016-17 as compared to the growth of 7.6per cent achieved in 2015-16.

Source: Ministry of Finance

The textile industry contributes to 10% of manufacturing production 2% of India's GDPand to 13% of the country's export earnings. With over 45 million people employeddirectly the textile industry is one of the largest sources of employment generation inthe country.

The innerwear market (comprising of the innerwear and the comfort wear market) wasestimated to be worth 28133 crores and is expected to grow at CAGR of 13 percent overnext ve years and reach Rs. 51913 crores by 2020.

Looking ahead we expect growth in the innerwear market to be driven by broad basedconsumer trends in the form of rising discretionary spend growing number of mid-highincome house hold and rising urbanization.

The innerwear industry in India holds immense growth potential and it is evident fromthe entry of large international brands in the Indian market in the last few years. TheIndian innerwear market continues to be underpenetrated and thereby holds immense businessopportunities. Provided the positive macro and demographic fundamentals the innerwearmarket has a favorable demand growth outlook over the medium-to-long term. The Indianinnerwear market is expected to witness expansion in the near future. However lesserproduct portfolio and high costs of brand building are expected to be the challenges forthis sector. Brand sensitivity is the major trend in the Indian innerwear industry.

Since the last few years Indian brands showcased new designs and styles to woo the newage Indian women. The focus was mainly on the width of the product range. Men's andwomen's innerwear began to be sold through a variety of retail formats such as ExclusiveBrand Outlets (EBO) Large Format Stores (LFS) and departmental stores. LFS withshop-in-shop concept have carved a niche by showcasing the entire product range.

Innerwear has graduated from being just a functional category to a category that offersadditional fashion quotient. It is shifting from a price sensitive category to a brandsensitive category. Exclusive brand stores are explored when looking for depth in stylesand variety in colors.

On the basis of product pricing the innerwear market is further divided intosuper-premium premium medium and economy segments. Due to increased awareness theincrease in number of brands and rising discretionary spending all segments haveregistered growth. Foreign brands have brought in variety through international styles andfabrics. Indian women are also willing to spend higher-than-before amounts on innerwear.This has provided an exponential boost to premium and super-premium innerwear brands.

Source: Images Business of Fashion

Due to Increased business serving multiple sales channels prepare for higher volumesales expected going forward in 2017 the Company invested in additional productioncapacity with advanced systems keeping long-term cost- ef ciency in focus to increase thegoods supply through put scale and bene t and enhance brands and products portfolio inthe market. During the year under review your company commissioned its new plant atGuwahati details of which are provided in the Corporate Governance Report

The Indian retail market is expected to grow at CAGR of 13 per cent to reach US $1080billion in2020 with current market size of US $585 billion. The share of apparel in Indianmarket is 8 per cent. Organised apparel retail contributes to 21 per cent of the totalapparel retail while organised lifestyle contribution in total lifestyle retail variesfrom 32per cent in footwear to 49 per cent in watches. Indian fashion retail market haswitnessed several signi cant changes in recent years which indicate the country'sevolving fashion retail market. One of the signi cant changes is advancing online retailore-tail of fashion products across the country. The current online retail accounts toabout 1.2 per cent of total retail market.

Source: Technopak

E-commerce is an emerging and fast growing channel in the country and your Company iswell placed to lead category growth in this channel. The Company ventured into theE-commerce channel through “” for distributing directly to theconsumers.

By 2020 India is expected to generate $100 billion online retail revenue out of which$35 billion will be through fashion e-commerce. Online apparel sales are set to grow fourtimes in coming years.

Your Company has developed a comprehensive e-commerce strategy and execution roadmapand has a team in place to drive disproportionate growth in this channel in the comingyears.It has further tied up with various leading online retailers to increase the reachof the product to entire country.


Your Company places utmost importance on ensuring safety of its employees visitors toour premises and the communities we operate in.

Your Directors are committed to strict compliance of not just statutory requirementsbut even more stern internal policies and best practices related to environment healthand safety in all our units. In the year under review your Company has furtherstrengthened its commitment to workplace compliance by increasing the strength of theworkplace Compliance Department to enhance monitoring and control in all these areas.

Environment: Your Company is an environment friendly organization as it is anon-polluting and non-ef uent generating manufacturing set-up.


A. Conservation of Energy

Your Company has a vision of being a 'Zero Injury' organization. The Compass yourCompany's strategic framework integrates Safety as a non-negotiable value. Information onconservation of energy technology absorption foreign exchange earnings and outgopursuant to Section 134(3)(m) of the Companies Act 2013 read with the Companies(Accounts) Rules 2014 are furnished below:

a. Conservation of Energy:

The Company continually takes steps to absorb and adopt the latest technologies andinnovations in the Garment Industry. These initiatives should enable the facilities tobecome more ef cient and productive as the company expands thus helping conserve energy.All machinery and equipment are continuously serviced updated and overhauled in order tomaintain them in good condition. This resulted in consumption of lesser energyconsumption.

Additional Investments and Proposals for Reduction of Consumption of Energy: Nil

Total Energy Consumption and Energy Consumption per Unit of Production (Form-A and FormB Enclosed).

Conservation of Energy continues to receive increased emphasis at all the units of theCompany.

Form A

Form for Disclosure of particulars with respect of conservation of energy

Particulars 2016-17 2015-16
Power & Fuel Consumption
1. Electricity
a) Purchased Units (Lacs) 7.17 6.98
Total Cost (Rs. In Lacs) 54.85 52.61
Rate/Unit (Rs.) 7.65 7.53
b) Own Generation
1)Through Diesel Generator
Units (Lacs) 0.48 0.49
KWH per unit of fuel 4.67 4.67
Fuel Cost/Unit (Rs.) 12.45 12.48

b. Technology Absorption:

Absorbing technologies with state of art machineries like automated cutting machineautomated fabric inspection machines etc. the quality of the products and ef ciency ofthe systems have been substantially improved. By applying those technologies the cost ofproduction was under control.

The products manufactured and sold by the Company are not power intensive; hence theimpact on overall cost is marginal. However steps have been taken to ensure energyconservation in the processing unit where an energy ef cient boiler is installed andcondensate is being re-utilised.

Efforts made in Technology absorption as per Form B: Nil

B. Consumption per unit of Production
Product Electricity
2016-17 2015-16
Consumption per Unit 0.06 0.06

C. Foreign Exchange Earning and Outgoing

The Company had foreign exchange earnings from Exports during the year was NIL(Previous year Rs. 1.49 lakhs). The total amount of outgo on account of foreign exchangeutilized by the Company amounted to Rs. 49.35 lakhs (Previous year Rs. 122.84 lakhs)mainly on account of import of raw materials nished goods Capital Goods foreign travel.

Foreign exchange earned and outgo during the year ended March 31 2017:

Rs. In Lakhs
Particulars 2016-17 2015-2016
Foreign Exchange Earned
Exports (FOB) - 1.49
Technical Assistance - -
Total - 1.49
Foreign Exchange Outgo - -
CIF Value of Imports 47.40 115.77
Travelling Expenses 1.95 0.82
Others - 6.24
Total 49.35 122.84


The Company's internal control systems are commensurate with the nature of its businessand the size and complexity of operations. These systems are routinely tested and certi edby Statutory as well as Internal Auditor and cover all of ces factories and key businessareas. Periodical reports and signi cant audit observations and follow up actions thereonare reported to the Audit Committee. The Audit Committee is headed by an IndependentDirector and this ensures independence of function and transparency of the process ofsupervision and oversight. The Audit Committee reviews adequacy and effectiveness of theCompany's internal control environment and monitors the implementation of auditrecommendations including those relating to strengthening of the Company's riskmanagement policies and systems. The Company conducts its business with integrity and highstandard of ethical behaviour and in compliance with the laws and regulations that governits business.



For the apparel industry in general and our market in particular:

• More organized retail. Better consumer retail experience

• Increasing fashion consciousness and consumers becoming more aspirationaldiscerning and brand savvy

• The factors that determine consumption education occupation urbanizationrise in nuclear families moving in a positive direction

• Increasing urban women population and women corporate workforce

• Increasing brand consciousness and spending on kids

• Higher disposable income

• Increasing online retail


Many major international apparel brands have commenced operations in India realizingthat Indian markets are likely to emerge as one of the largest market in the world in thenext few decades. Competitive intensity is expected to sustain high.


The Company has robust risk management procedures to identify and evaluate risks on anongoing basis. The identi ed risks are integrated into the business plan and a detailedaction plan to mitigate the identi ed business risk and concerns is put in place.

The key risks and concern identi ed by the company and its mitigation plans are:

Availability and Rising Cost of Labour:

The industry is growing at a fast pace in a highly labour intensive sector and demandfor experienced and trained manpower is outstripping supply. The ability to retainexisting talent and attract new talent assumes crucial importance. The Company has createdlong term plans with the objective of motivating employees to create a sense of“belonging” and a ‘feel good' environment. The Company has set up robusttraining centers at various units where newcomers to the labour force receive structuredtraining.

Increase in input and brand-building costs:

The availability of raw materials at reasonable rates is one of the main concerns ofthe company. However the company is con dent that increases in raw material cost if andwhen they occur can be passed on to consumers because of the strong pricing power of itsbrands. The company is also aggressively taking steps to monitor and improve productivitywhich will mitigate the impact of material cost increases to some extent. The Company isalso conscious that in the Media environment of exploding media vehicles and fragmentedaudiences the challenges for achieving Brand Reach and delivering effective communicationare rising disproportionately. The Company is taking steps to plan and execute mediacampaigns with higher ef ciency and continue to achieve brand salience.


Your Company fully values the Human capital; it deploys and credits its success tothem. It has been the consistent endeavor of the Company to create a congenial andchallenging working atmosphere wherein every employee can develop his own strength anddeliver to his full potential.

During the year under review industrial relations in the factory were cordial andpro-active and all employees and the Union supported productivity and process improvementmeasures undertaken at all the functions of the Company. Their unstinted co-operation hasenabled the unit to achieve continuous growth both quantitatively and qualitatively. YourCompany continued to maintain excellent industrial relations with all its employees andindependent job work rms. Adequate safety and welfare measures are in place and yourCompany will continue to improve the same on ongoing basis.

As of 31st March 2017 the Company had 1670 employees on its roll.


The global economic climate continues to be volatile uncertain and prone togeo-political risks. Weak consumer sentiment and low commodity prices are expected toaffect global growth adversely.

Your Company has achieved a signi cant growth and has been constantly followingemerging market trends and has accordingly from time to time revamped its marketingstrategies and product portfolios. The Company is trying to come up with some new productsand ranges of inner wears according to changing consumer needs and demand.

Your Company has taken a step to evolve in the super-premium segment of innerwear.India is expected to perform better aided by improving macroeconomic fundamentals. Whilecurrently in ation is benign upside pressures on in ation from the vagaries of monsoon orsudden changes in the rupee could have a signi cant bearing on in ation.

FMCG markets are expected to grow. While consumer con dence has increased this has notyet translated into signi cant improvement in FMCG market conditions. There are a fewgreen shoots in market growths; however uncertain global economic environment in ationand competitive intensity continue to pose challenges. Your Company with its brandstalent and investment in capabilities is well placed to bene t disproportionately fromthis opportunity.


Statements in the management discussion and analysis describing the Company'sobjectives projections estimates and expectations may be considered as “forwardlooking statements” within the meaning of applicable securities laws and regulations.Actual results could differ materially from those expressed or implied. The factors thatmight in uence the operations of the Company are economic conditions governmentregulations and natural calamities over which the Company has no control.

The Company assumes no responsibility in respect of the forward looking statementsherein which may undergo changes in future on the basis of subsequent developmentsinformation or events.


Your Directors place on record their sincere appreciation for the signi cantcontribution made by our employees through their dedication hard work and commitment.

The Board places on record its appreciation for the support and co-operation yourCompany has been receiving from its customers suppliers distributors stockistsretailers business partners and others associated with the Company as its tradingpartners. Your Company looks upon them as partners in its progress. It will be theCompany's endeavour to build and nurture strong links with the trade based on mutuality ofbene ts respect for and co-operation with each other consistent with consumer interests.

The Directors also take this opportunity to thank all Shareholders Investors ClientsVendors Bankers Government and Regulatory Authorities and Stock Exchanges for theircontinued support.

On behalf of the Board of Directors
Place: Mumbai L Vinay Reddy Lovable Lingerie Limited L. Jaipal Reddy
Date: May 29 2017 Managing Director Whole Time Director
(DIN: 00202619) (DIN:01539678)