Lovable Lingerie Ltd Directors Report.


The Members,

Your Companys Directors are pleased to present the 33rd Annual Report of the Company, along with the Audited Financial Statements for the financial year ended 31st March 2020.


(Rs. in Lakhs)
Particulars 2019-20 2018-19
Revenue from operations 14,237.81 17,550.54
Operating Expenditure 13,619.92 16,842.23
Profit Before Interest, Tax & Depreciation 617.89 708.31
Other Income (net) 121.23 206.05
Finance Costs 9.38 7.23
Profit before Tax and Depreciation 729.74 907.14
Depreciation and amortization expense 176.22 168.63
Profit before Extra-Ordinary Item 553.52 738.51
Extra-Ordinary Item 151.08 415.92
Profit before Tax (PBT) 402.45 322.59
Provision for Taxation 88.38 241.05
Profit for the year (PAT) 314.07 81.55
Surplus brought forward from previous year 9,044.03 9,029.40
Amount available for appropriation 9,328.78 9,044.03
Appropriations: - -
Transferred to General Reserve - -
Dividend (excluding tax) 74.00 -
Tax on Dividend 15.06 -
Proposed Dividend on Equity Share Capital - -
Corporate Dividend Tax on Proposed Dividend - -
Adj for Depreciation of prior years pursuant to change in useful life - -
Balance Carried to Balance Sheet 9,239.72 9,044.03
EPS Basic & Diluted- Before Extraordinary Items (in Rs.) 3.14 3.36
EPS Basic & Diluted- After Extraordinary Items (in Rs.) 2.12 0.55


For the financial year 2019-20, the Company recorded a net turnover of Rs.14,237.81 lakhs as against Rs.17,550.54 lakhs for the financial year 2018-19, registering a decrease of 18.87%. The Net Profit Before Tax stood at Rs.402.45 lakhs as against Rs. 322.59 lakhs over last year and Profit After Tax stood at Rs.314.07 lakhs for the year as against Rs.81.55 lakhs in the last year.


The Company is engaged in the business of manufacturing garments. Therefore, there is no separate reportable segment.


The Board of Directors has decided to retain the entire amount of profits in the profit and loss account.


The Board of Directors has recommended a final dividend of 5% on Equity Shares i.e. 0.50 INR per Equity Share of 10 each for the financial year ended on 31st March, 2020. The final dividend if approved at the forthcoming Annual General Meeting (AGM) will be paid out of the profits of the Company and the same will be paid to those members whose names shall appear on the Companys Register of Members as on the Record date and/or the Book Closure date as may be determined by the Board of Directors. The total dividend for the financial year, including the proposed Final Dividend, amounts to Rs.0.50 per equity share and will absorb Rs 74.00 Lakhs. In view of the changes made under the Income-tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of the Shareholders. Your Company shall, accordingly, make the payment of the Final Dividend after deduction of tax at source.


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


No material changes (except global pandemic situations) and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relate and the date of this report.


The extract of Annual Return as provided under sub-section (3) of section 92 of the Companies Act, 2013 (‘the Act) read along with Rule 12 of the Companies (Management and administration) Rules, 2014 in prescribed form MGT-9 is enclosed as "Annexure A" to this report and the same has been disclosed on the companys website and is accessible on http://lovableindia.in/index.php?route=information/information&information_id=17


In accordance with the provisions of Section 152 of the Companies Act, 2013, Mrs. Taruna Reddy (DIN: 02787135) retires by rotation at the ensuing Annual General Meeting (‘AGM)and is eligible for re-appointment. The Board of Directors recommends the re-appointment of Mrs. Taruna Reddy as a Non-executive Director of the Company.

During the year under review, no change took place in the composition of Board of Directors of the Company.

In terms of Section 203 of the Act, the Board has designated the following persons as Key Managerial Personnel of your Company:

• Mr. L Vinay Reddy, Chairman & Managing Director

• Mr. Raghunathan Govindarajan, Chief Financial Officer

• Ms. Divya Shrimali, Company Secretary & Compliance Officer


For the purpose of selection of any Director, the Nomination and Remuneration Committee identifies the person of integrity who possess relevant expertise, experience and leadership qualities required for the position and also takes into consideration recommendation, if any, receives from any members of the Board. The Committee also ensures that the incumbent fulfills such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws.

The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration.

The Companys policy on directors appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the corporate governance report, which forms part of the directors report.


The Company has received declaration from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013and as per SEBI (Listing Obligation and Disclosure Requirement) Regulation, 2015 ("Listing Regulation, 2015").


The Company has constituted the following committees in compliance with the Companies Act, 2013 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 brief description, composition and other required details of the above committees are provided in Corporate Governance Section to this Annual Report.


In compliance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI (LODR) Regulations"), the Company has put in place a Familiarization Programme for the Independent& Non-Executive Directors to familiarize them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model etc. The details of such programme is available on the website of the company www.lovableindia.in and may be accessed through the web link http://lovableindia.in/index.php?route=information/information&information_id=69.


The Board of Directors met 4 (Four) times during the year on 29th May, 2019; 10th August, 2019; 12th November, 2019; and 13th February, 2020. For details of the meetings of the board, please refer to the corporate governance report, which forms part of this report. The intervening gaps between the Meetings were within the period prescribed under the Companies Act, 2013 and SEBI (LODR) Regulations.


The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.


The Board of Directors have carried out an annual evaluation of its own performance, its various committees and individual directors pursuant to the provisions of the Companies Act 2013, the Corporate Governance requirements as prescribed under regulation 17(10), 25(4) and other applicable provisions of the SEBI (LODR) Regulations and the Guidance note issued by SEBI.

The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of various criteria such as Board Composition, process, dynamics, quality of deliberations, strategic discussions, effective reviews, committee participation, governance reviews etc.

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

The Board and the Nomination and Remuneration Committee reviewed the performance of the individual directors on the basis of the criteria such as Transparency, Analytical Capabilities, Performance, Leadership, Ethics and ability to take balanced decisions regarding stakeholders.

In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of the executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of independent directors, at which the performance of the Board, its committee and individual Directors was also discussed.


The particulars of loans, guarantees and investments have been disclosed in the financial statements.


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


In line with the requirements of the Companies Act, 2013 and SEBI (LODR) Regulations, your Company has formulated a Policy on Related Party Transactions which is available on Companys website; web link at http://lovableindia.in/index. php?route=information/information&information_id=69. The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties.

All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions on a yearly basis for transactions which are of repetitive nature and or entered in the Ordinary Course of Business and are at Arms Length.

All Related Party Transactions entered during the year were in Ordinary Course of the Business and on Arms Length basis. No Material Related Party Transactions were entered during the year by the Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC 2 is not applicable.


To create enduring value for all stakeholders and ensure the highest level of honesty, integrity and ethical behaviour in all its operations, the company has formulated a Vigil Mechanismin addition to the existing code of conduct that governs the actions of its employees. This Whistleblower policy aspires to encourage all employees to report suspected or actual occurrence(s) of illegal, unethical or inappropriate events (behaviours or practices) that affect Companys interest / image. A copy of the Policy is available on the website of the Company and may be accessed through the web link http://lovableindia. in/index.php?route=information/information&information_id=69.


The Company has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassmentat the Workplace, to provide protection to women (including outsiders) at the workplace and for prevention and redressal of complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. The Company has also constituted an Internal Complaints Committee to consider and to redress complaints of sexual harassment. The Committee has not received any complaint of sexual harassment during the year under review.

The Committee has not received any complaint of sexual harassment during the year under review.


In accordance with the requirements of Section 135 of Companies Act, 2013, your Company has constituted a Corporate Social Responsibility Committee. The composition, terms of reference and other relevant details of the Corporate Social Responsibility Committee is provided in the Corporate Governance Report.

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities and expenditure incurred thereon during the year are set out in "Annexure B" of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy is available on the website of the Company; weblink http://lovableindia.in/index.php?route=information/information&information_id=69.


The information required under Section 197 of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as "Annexure C" to this Report.

The information required under Section 197 of the Companies Act, 2013 read with Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not applicable, since during the year under review none of the employees of the Company was in receipt of remuneration in excess of the limits specified, whether employed for the whole year or part thereof.


The Board of Directors of the Company confirms that:

• in the preparation of the annual accounts for the financial year ended 31st March, 2020, the applicable accounting standards have been followed and that no material departures have been made from the same;

• they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

• they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets 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 internal financial controls are adequate and operating effectively; and

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


The Company has not accepted any deposits covered under Chapter V of the Companies Act, 2013.


Your Companys shares are listed in the BSE Limited, Mumbai (BSE) and National Stock Exchange 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, the Cash Flow Statement for the year ended 31.03.2020 is enclosed as a part of this Annual Report.


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


Statutory Auditors

M/s. DMKH & Co., a firm of Chartered Accountants were appointed as a Statutory Auditors of the Company for One term of 5 (five) consecutive years to hold office from the conclusion of the 30th Annual General Meeting held on 30th August, 2017 until the conclusion of the 35th Annual General Meeting (AGM) to be held in year 2022.

The notes on Financial Statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The Auditors Report does not contain any qualifications, reservation or adverse remark and is prepared as per "Ind AS".

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 had appointed M/s. D. M. Zaveri & Co., Practicing Company Secretaries, Mumbai to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as "Annexure D". Reply to the observations made in Secretarial Report:

a) The observation given by the Secretarial Auditor in respect of delay in transferring/crediting the shares to Investor Education and Protection Fund, the delay was unintentional and was occurred inadvertently and the Company is in process to comply the same at the earliest.

b) The observation given in respect of delay occur for publication of notice of Board Meeting held on 10th August 2019 in newspaper advertisement by 2(two) days pursuant to sub-regulation (1) of Regulation 47 Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the delay was unintentional and was occurred inadvertently.


During the year under review, neither the statutory auditors nor the secretarial auditors has reported to the Audit committee, under section 143(12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officer or employees, the details of which would need to be mentioned in the Boards report.


No significant or material Orders were passed by the Regulators or Courts or Tribunals during the previous year which may impact the Going Concern Status of the Companys Operation in the future.


In terms of the provisions of Section 125 of the Companies Act, 2013 read with the Companies (Declaration and Payment of Dividend) Rules, 2014, unclaimed / un-encashed dividend for the FY 2012-13 is due for transfer to IEPF on 5th September 2020. Members who have not encashed their dividend warrants pertaining to the aforesaid years may approach the Company/ its Registrar, for obtaining payments thereof atleast 20 days before they are due for transfer to the said fund.

Pursuant to the provisions of the Investor Education Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has already filed the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last Annual General Meeting (i.e. September 26, 2019), with the Ministry of Corporate Affairs.


Your Company continues to lay a strong emphasis on transparency, accountability and integrity.

The Companies Act, 2013 and the Listing Regulations have strengthened the governance regime in the country. Your Company is in compliance with the governance requirements provided under the new law.

Your Company has in place all the statutory Committees required under the law. Details of Board Committees along with their terms of reference, composition and meetings of the Board and Board Committees held during the year, are provided in the Corporate Governance Report enclosed as "Annexure E" to this report.

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

A separate report on Corporate Governance is provided together with a Certificate from the Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under the Listing Regulations. A Certificate of the CEO and CFO of the Company in terms of sub-Regulation 17(8) of the Listing Regulations, inter alia, confirming the correctness of the financial statements and cash flow statements, adequacy of the internal control measures and reporting of matters to the Audit Committee, is also annexed.


To avoid duplication between the Directors Report and the Management Discussion and Analysis, we present below a composite summary of performance and functions of the Company.


The Indian textiles industry, currently estimated at around US$ 150 billion, is expected to reach US$ 250 billion by 2019. Indias textiles industry contributed seven per cent of the industry output (in value terms) of India in 2017-18. It contributes 2.3% to the GDP of India, 7% of the countrys manufacturing production and 13% of countrys export earnings. It employs more than 45 million people and expected to touch 55 million by 2020, rendering it a very vital component of Indias organized and unorganized sector employment.

India is well integrated in the value-chain of the Textile Industry from fibre to fashion.

The production of raw cotton in India is estimated to have reached 36.1 million bales in FY19.


The Indian government has come up with a number of export promotion policies for the textiles sector. It has also allowed 100 per cent FDI in the Indian textiles sector under the automatic route.

Initiatives taken by Government of India are:

- The Directorate General of Foreign Trade (DGFT) has revised rates for incentives under the Merchandise Exports from India Scheme (MEIS) for two subsectors of Textiles Industry - Readymade garments and Made ups - from 2 per cent to 5 per cent.

- As of August 2018, the Government of India has increased the basic custom duty to 20 per cent from 10 per cent on 501 textile products, to boost "Make in India" and indigenous production.

- The Government of India announced a Special Package to boost exports by US$ 31 billion, create one crore job opportunities and attract investments worth Rs 80,000 crore (US$ 11.93 billion) during 2018-2020. As of August 2018, it generated additional investments worth Rs 25,345 crore (US$ 3.78 billion) and exports worth Rs 57.28 billion (US$ 854.42 million).

- The Government of India has taken several measures including Amended Technology Up-gradation Fund Scheme (A-TUFS). This Scheme is estimated to create employment for 35 lakh people and enable investments worth Rs 95,000 crore (US$ 14.17 billion) by 2022.

- Integrated Wool Development Programme (IWDP) approved by Government of India to provide support to the wool sector starting from wool rearer to end consumer which aims to enhance the quality and increase the production during 2017-18 and 2019-20.

- The Cabinet Committee on Economic Affairs (CCEA), Government of India has approved a new skill development scheme named ‘Scheme for Capacity Building in Textile Sector (SCBTS) with an outlay of Rs 1,300 crore (US$ 202.9 million) from 2017-18 to 2019-20.

- Government of India approves special package for employment generation viz

• Employee Provident Fund Scheme Reforms

• Increasing overtime caps

• Introduction of fixed term employment

• Additional incentives under ATUFS

• Enhanced duty drawback coverage

• Enhancing scope of Section 80JJAA of Income Tax Act

The management discussion and analysis presents the industry Overview, Strength, Opportunities and Performance, Initiatives by the Company and overall strategy of Lovable Lingerie Limited becoming a market driven producer/exporter of various innovative models and ranges of Textiles products.


Indian Textile industry can be divided into several segments, some of which can be listed as below:

- Cotton Textiles

- Silk Textiles

- Woolen Textiles

- Readymade Textiles

- Jute and Coir


- India has rich resources of raw materials for the textile industry. It is one of the largest producers of cotton in the world and also rich in resources of fibres like polyester, silk, viscose etc.

- India is riched in highly trained manpower. The country has a huge advantage due to lower labour rates. Because of low labour rates, the manufacturing cost in textile manufacturing automatically comes down to very reasonable levels.

- India is highly competitive in spinning sector and has presence in almost all processes of the value chain.


- Low per-capita domestic consumption of textile indicating significant potential growth.

- The Domestic market is extremely sensitive to fashion fads and this has resulted in the development of a responsive garment industry, catering to paying and aspirational customers.

- Indias global share is just 3% while China controls about 15%, signifying considerable headroom to scale up.

- Companies need to concentrate on new global product standards for leveraging the opportunities.


- The industry which was growing at 3-4% during the last six decades has now accelerated to the annual growth rate of 9-10% but various factors have effecting annual growth rate of textile industry, Global recession and Domestic demand slowdown coupled with a Supply glut is one of them.

- The impact of the global and domestic economic slowdown is directly affect the performance of the industry.


Capacity building:

In order to steer your company into an aggressive growth path, the company is looking into enter the mass segment, which had not been fully explored by the company till date. To meet the expected demand from the mass segment, the company is building new capacity at our Erode Plant with an annual production capacity of 25 lakhs nos., which is 30% of the companys total capacity.

Upskilling of Employees:

Of all the factors of production, work force comes first. Upskilling and Reskilling the the work force in tune with the latest technological developments, not only motivates the employees but also increase the productivity and upgrades product standards. Your company, assisted with the Government of India Initiative on Upskilling and Resiklling "Samarth" schemes, set up and tied up with training centres to equip our work force with modern techniques.

New Product Categories and Styles:

Your company has identified the twin routes of deeper & category-leading brand-building & scale-up of production routes to high sales volumes & to be the engines of growth.

SS19 collection of Lovable comprised of Premium & Classic products like Encircle-The Original, Encircle-Elite, ADL-The 1, whole new range of styles in our Confi-series & a whole new line of products under the name "Prime", which caters the plus- size category of the market. Under Daisy Dee, the company has launched a new sub-brand by the name of Daisy Dee OUTFIT for tapping into the Athleisure category. The company is looking to tap mass segment under the category of "Lovable Essensuals"

Accordingly, your company in the year 2019-20 has invested heavily in new marketing initiatives, advertising & a heightened media presence, besides launches of new, trendy products in innerwear & sportswear. Your company has also increased its online presence through various mediums of social media and presence on leading Ecommerce Marketplaces. Dealer Apps for direct communication with the market has also been launched in 2019.


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

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

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


A. Conservation of Energy

Your Company has a vision of being a ‘Zero Injury organization. The Compass, your Companys strategic framework, integrates Safety as a non-negotiable value. Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, pursuant 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 and innovations in the Garment Industry. These initiatives should enable the facilities to become more efficient and productive as the company expands, thus helping conserve energy. All machinery and equipment are continuously serviced, updated and overhauled in order to maintain them in good condition. This resulted in consumption of lesser energy consumption.

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

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

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

Form A

Form for Disclosure of particulars with respect of conservation of energy

Particulars 2019-20 2018-19
Power & Fuel Consumption
1. Electricity
a) Purchased Units (Lacs ) 5.55 6.07
Total Cost (Rs. In Lacs) 57.44 60.81
Rate/Unit (Rs.) 10.35 10.01


Particulars 2019-20 2018-19
b) Own Generation
1) Through Diesel Generator
Units (Lacs) 0.42 0.58
KWH per unit of fuel 4.67 4.67
Fuel Cost/Unit (Rs.) 18.87 15.38

b. Technology Absorption:

Absorbing technologies with state of art machineries like automated cutting machine, automated fabric inspection machines, etc., the quality of the products and efficiency of the systems have been substantially improved. By applying those technologies, the cost of production was under control.

The products manufactured and sold by the Company are not power intensive; hence the impact on overall cost is marginal. However, steps have been taken to ensure energy conservation in the processing unit where an energy efficient boiler is installed and condensate is being re-utilised.

Efforts made in Technology absorption as per Form B: Nil

B. Consumption per unit of Production

Product Electricity
2019-20 2018-19
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 NIL). The total amount of outgo on account of foreign exchange utilized by the Company amounted to Rs.33.82 lakhs (Previous year Rs. 66.10 lakhs) mainly on account of import of raw materials, finished goods, Capital Goods, foreign travel.

Foreign exchange earned and outgo during the year ended March 31, 2020:

(Rs. in lakhs)
Particulars 2019-20 2018-19
Foreign Exchange Earned - -
Exports (FOB) - -
Technical Assistance - -
Total - -
Foreign Exchange Outgo - -
CIF Value of Imports 28.38 38.13
Travelling Expenses - -
Others 5.44 27.97
Total 33.82 66.10


The Companys internal control systems are commensurate with the nature of its business and the size and complexity of operations. These systems are routinely tested and certified by Statutory as well as Internal Auditor and cover all offices, factories and key business areas. Periodical reports and significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee is headed by an Independent Director and this ensures independence of function and transparency of the process of supervision and oversight. The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems. The Company conducts its business with integrity and high standard of ethical behaviour and in compliance with the laws and regulations that govern its business.


Sr No. Particulars Year 2019-20 Year 2018-19 Change in %
1 Debtors Turnover 3.47 3.85 (10%)
2 Inventory Turnover 2.62 3.50 (25%)
3 Interest Coverage Ratio 60.00 103.18 (42%)
4 Current Ratio 6.02 4.10 47%
5 Debt Equity Ratio 0.05 - 5%
6 Operating Profit Margin (%) 4% 4% (7%)
7 Net Profit Margin (%) 3% 3% 15%
8 Return on Net worth 3% 3% (7%)

Explanation: Due to increased competitive intensity and contraction of overall demand, there was a drop in our turnover in FY20 as compared to FY19. The drop in turnover has impact on profitability and financial ratios for FY20 as compared to FY19.



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 aspirational, discerning and brand savvy.

• The factors that determine consumption, education, occupation, urbanization, rise 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.

• Company need to concentrate on new global product.

• Low per-capita domestic consumption of textile indicating significant potential growth.


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

Indias global share is just 3% while China controls about 15%. In post 2015, China is expected to capture 43% of global textile trade.


The Company has robust risk management procedures to identify and evaluate risks on an ongoing basis. The identified risks are integrated into the business plan and a detailed action plan to mitigate the identified business risk and concerns is put in place.

The key risks and concern identified 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 demand for experienced and trained manpower is outstripping supply. The ability to retain existing talent and attract new talent assumes crucial importance. The Company has created long term plans with the objective of motivating employees to create a sense of "belonging" and a ‘feel good environment. The Company has set up robust training centers at various units where newcomers to the labour force receive structured training.

Increase in input and brand-building costs:

The availability of raw materials at reasonable rates is one of the main concerns of the company. However the company is confident that increases in raw material cost, if and when they occur, can be passed on to consumers because of the strong pricing power of its brands. The company is also aggressively taking steps to monitor and improve productivity, which will mitigate the impact of material cost increases to some extent. The Company is also conscious that in the Media environment of exploding media vehicles and fragmented audiences, the challenges for achieving Brand Reach and delivering effective communication are rising disproportionately. The Company is taking steps to plan and execute media campaigns with higher efficiency and continue to achieve brand salience.


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

During the year under review, industrial relations in the factory were cordial and pro-active and all employees and the Union supported productivity and process improvement measures undertaken at all the functions of the Company. Their unstinted co-operation has enabled the unit to achieve continuous growth, both quantitatively and qualitatively. Your Company continued to maintain excellent industrial relations with all its employees and independent job work firms. Adequate safety and welfare measures are in place and your Company will continue to improve the same on ongoing basis.

As of 31st March, 2020, the Company had 1099 employees on its roll.


The future for the Indian textile industry looks promising, buoyed by both strong domestic consumption as well as export demand. With consumerism and disposable income on the rise, the retail sector has experienced a rapid growth in the past decade with the entry of several international players like Marks & Spencer, Guess and Next into the Indian market.

High economic growth has resulted in higher disposable income. This has led to rise in demand for products creating a huge domestic market.

The global economic climate continues to be volatile, uncertainand prone to geo-political risks. Weak consumer sentiment and low commodity prices are expected to affect global growth adversely.

Your Company has achieved a significant growth and has been constantly following emerging market trends and has accordingly from time to time revamped its marketing strategies and product portfolios. The Company is trying to come up with some new products and 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.


Statements in the management discussion and analysis describing the Companys objectives, projections, estimates and expectations may be considered as "forward looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. The factors that might influence the operations of the Company are economic conditions, government regulations and natural calamities over which the Company has no control.

The Company assumes no responsibility in respect of the forward-looking statements herein which may undergo changes in future on the basis of subsequent developments, information or events.


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

The Board places on record its appreciation for the support and co-operation your Company has been receiving from its customers, suppliers, distributors stockists, retailers, business partners and others associated with the Company as its trading partners. Your Company looks upon them as partners in its progress. It will be the Companys endeavour to build and nurture strong links with the trade based on mutuality of benefits, respect for and co-operation with each other, consistent with consumer interests.

The Directors also take this opportunity to thank all Shareholders, Investors, Clients, Vendors, Bankers, Government and Regulatory Authorities and Stock Exchanges, for their continued support.

On behalf of the Board of Directors
For Lovable Lingerie Limited,
L Vinay Reddy
Managing Director
Place: Mumbai DIN: 00202619
Mumbai, 29th July, 2020