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Rei Six Ten Retail Ltd www.6ten.co.in

SECTOR: TRADING REPORTING DATE: 31ST MAY,2016

REI Six Ten Retail Ltd. 31st May, 2016 TABLE 1 - MARKET DATA (STANDALONE) (As on 27th May, 2016)

NSE Code - REISIXTEN NSE Market Price (₹) 0.30 NSE Market Cap. (₹ Cr.) 4.85

Sector - Trading Face Value (₹) 2.00 Equity (₹ Cr.) 29.42

52 week High/Low (₹) 0.50/0.25 Net worth (₹ Cr.) 53.69

Business Group - Indian Pvt. TTM P/E N.A. Traded Volume (Shares) 5,736

Year of Incorporation - 2007 TTM P/BV 0.01 Traded Volume (lacs) 0.02

Source - Capitaline

Corporate Office: COMPANY BACKGROUND

Everest House, Room No 15B, REI Six Ten Retail Limited (RSTRL) was incorporated in March 2007 as Retail chain. REI Six Ten

Retail Limited is an India-based Company engaged in retail business. REI Six Ten is engaged in

grocery, fruits and vegetables trade selling to its stores on franchise mode. 6TEN is a chain of

small convenience stores on franchisee basis and value stores.

During the fiscal year ended 31st March, 2011 (fiscal 2011), the Company had 169 franchised

outlets across Delhi and National Capital Region, Punjab, Jaipur, Kolkata, Nagpur, Ahmedabad

and Baroda. The Company is already operating 297 value stores across Delhi, National Capital

Region and Punjab. As of November 30, 2011, 6Ten was operating 344 stores in the Delhi,

Chandigarh, Mohali, Panchkula, Amritsar, Ludhiana, Baddi, Jalandhar, Ambala and Nagpur. All

the stores are on Company-owned and Company-operated basis.

15th Floor, 46C, Chowringhee

Road, Kolkata - 700 071

West Bengal

Company Website:

www.6ten.co.in

TABLE 2 - PRICE PERFORMANCE

27th May, 2016

29th May, 2015

30th May, 2014

% Change CAGR for 2 years 2016 vs 2015 2015 vs 2014

Price (₹) 0.30 0.35 0.75 -14.29% -53.33% -36.75%

Trading Volume (Shares) (yearly avg.)

34,963 2,50,857 2,15,947 -86.06% 16.17% -

NSE Market Cap. (in ₹ Cr.) 4.41 5.15 11.03 -14.37% -53.31% -36.77%

Source - Money Control

http://www.6ten.co.in/




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TABLE 3 - FINANCIALS

(₹ Cr.) 2015 2014 2013 % Change CAGR for 2

years 2015 vs 2014 2014 vs 2013

Turnover 43.39 97.73 409.70 -55.60% -76.15% -67.46%

Net Worth 53.69 85.69 100.66 -37.34% -14.87% -26.97%

Current Assets 135.44 128.01 135.25 5.80% -5.35% 0.07%

Non-Current Assets 0.28 1.87 14.54 -85.03% -87.14% -86.12%

Total Assets 135.72 129.88 149.79 4.50% -13.29% -4.81%

Investments 48.06 39.26 40.91 22.41% -4.03% 8.39%

Finance Cost - 0.06 0.08 -100.00% -25.00% N.A.

Long Term Liabilities - - 0.43 - - N.A.

Current Liabilities 82.03 44.18 48.70 85.67% -9.28% 29.78%

Profit After Tax (₹ Cr.) -31.66 -14.97 -48.04 N.A. N.A. N.A.

EPS (₹) -2.00 -1.00 -3.00 N.A. N.A. N.A.

Source - Money Control/Annual Report

Discussion as per Company: The Company has In its Annual Reports for last three years has mentioned:

During the year 2015, the Company has achieved a turnover of ₹ 43.39 crores against ₹ 97.73 Crores in the previous year. The

Management of the Company is trying very hard to review the Company and to get the operation back on track. Earlier the

Company was working on Company owned and Company operated (COCO) model of retail business, then it moves to franchise

model Due to less and slow recovery of old debts the bottom line of the Company faces heavy pressure and Company extended

it losses from ₹ 14.97 crores to ₹ 31.65 crores during the year under review.

The Company during the year 2014 reported total revenue of ₹ 97.73 crores in comparison to ₹ 409.70 crores during previous

year. The decline in revenue from operations is due to closure of franchisee business module. In the year under review

Company incurred a loss of ₹ 14.97 crores as against loss of ₹ 48.04 crores during the previous financial year.

The Company during the year 2013 reported total revenue of ₹ 409.70 crores in comparison to ₹ 614.05 crores during previous

year. The decline in revenue from operations recording a downfall of 33.27% is due to reduction in franchisee in spite of best

efforts made by board of directors to improve sales. Recognition of impairment loss on assets of the Company, in accordance to

accounting standard (AS) – 28 issued by the Institute of Chartered Accountants of India, in profit and loss account as expenses

resulted in a post-tax loss of ₹ 48.04 crores during the financial year 2012-13 as against profit of ₹ 0.32 crores during the

previous financial year.

Though the revenue from operations and profit after tax of the Company has sharply fallen during the year, the directors

believe that the Company will perform better in the coming years.




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AUDIT QUALIFICATIONS

Auditors have made following qualification in Annual Report of FY 2014-15.

Basis of Qualified Opinion:

“Trade Receivables amounting to ₹ 87.23 Crores is outstanding for considerable period of time. No confirmations have been received

for these customers. In our opinion the debts are doubtful of recovery against which no provision has been made in the financ ial

statement.”

Management Response:

“In this regard, Board of Directors of the Company submits that the Company is pursuing with the parties for payment of dues,

however if management feels that these debts may not be recovered, they will provide necessary provisions in the upcoming financial

years.”

Response Comment

Frequency of Qualifications Only once for the financial year 2014-15

Have the Auditors made any adverse remark in last 3 years? No -

TABLE 4: BOARD PROFILE (As on 31st March, 2015)

Compliance Company

% of Independent Directors on the Board 50% 67%

% of Promoter Directors on the Board - 17%

Number of Women Directors on the Board Atleast 1 1

Classification of Chairman of the Board - Not Disclosed

Is the post of Chairman and MD/CEO held by the same person? - No

Average attendance of Directors in the Board meetings (%) - 67%

Source - Money Control/Annual Report

Composition of Board: As per Regulation 17(i)(b) of the Listing Regulations, 2015, the Company should have at least 50%

Independent Directors as the Company does not have any Chairman of the Board. The Company as on 31st March, 2015 has 60 % of

Independent Directors and hence, it meets the regulatory requirements.

Board Diversity: As on 31st March, 2015 the Company has 6 directors out of which 5 are male and 1 female. However, at present, the

Company does not have a single woman Director on the Board. Ms. Anishrava Agrawal was appointed as women director on the

Board on 31st March, 2015, however she resigned from the board on 25th April, 2015. Thus, the Company is non-compliant as per

Listing Regulations, 2015 regarding the requirement of at least one women director.


http://www.sebi.gov.in/cms/sebi_data/attachdocs/1441284401427.pdf



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TABLE 5 - FINANCIAL RATIOS

Ratios 2015 2014 2013 % Change

2015 vs 2014 2014 vs 2013

Turn

ove

r

Rat

ios

Inventory Turnover - - 37.11 - -

Debtors Turnover 0.50 1.11 4.89 -55.00% -77.40%

Fixed asset Turnover 154.96 52.26 28.18 196.51% 85.47%

Current Asset Turnover 0.32 0.76 3.03 -58.04% -74.80%

Ret

urn

Rat

ios Operating Profit Margin -2.97% -4.60% -12.49% N.A. N.A.

Net Profit Margin -72.97% -15.32% -11.73% N.A. N.A.

Return on Assets (ROA) -23.33% -11.53% -32.07% N.A. N.A.

Return on Equity (ROE) -58.97% -17.47% -47.73% N.A. N.A.

Return on Capital Employed (ROCE) N.A. N.A. N.A. N.A. N.A.

Liq

uid

ity

Rat

ios

Current Ratio 1.65 2.90 2.78 -43.02% 4.33%

Quick Ratio 1.65 2.90 2.55 -43.02% 13.60%

Cash Ratio 0.59 0.90 0.83 -34.41% 7.91%

Working Capital Turnover ratio 0.81 1.17 4.73 -30.32% -75.37%

Solv

ency

Rat

ios Debt to equity ratio 0.71 - - - -

Interest Coverage Ratio N.A. N.A. N.A. N.A. N.A.

Trad

ing

Rat

ios

Market Cap / Sales 0.11 0.05 0.01 125.24% 319.22%

Market Cap/ Net Worth 0.09 0.05 0.05 59.60% 17.47%

Market Cap/PAT N.A. N.A. N.A. N.A. N.A.

Market Cap/EBITDA N.A. N.A. N.A. N.A. N.A.

Trading Volume (shares) (avg. of 1 year) 35,140 2,70,567 1,94,293 -87.01% 39.26%

Trading Volume (shares) (high in 1 year) 4,45,158 25,64,827 29,45,714 -82.64% -12.93%

Trading Volume (shares) (low in 1 year) 1 600 1,235 -99.83% -51.42%

Ratio - High/low trading volume 4,45,158 4,275 2,385 10,313.76% 79.22%

Ratio - High/average trading volume 12.67 9.48 15.16 33.64% -37.48%

Source - Money Control




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TABLE 6(A): OWNERSHIP & MANAGEMENT RISKS

Dec' 2015 Dec' 2014 Dec' 2013 Comments

Shar

eho

ldin

g

Promoter shareholding 44.46% 44.46% 53.80% No new equity shares were issued by the

Company during the two-year period from

Dec’2013 to Dec’2015. The promoter

shareholding decreased from 53.80% to

44.46% in the year 2014 due to sale of shares

by the promoters in the secondary market.

No other major change was observed in the

shareholding pattern during the said period.

The promoters have pledged 4.59% of their

shareholding.

Public - Institutional shareholding

7.86% 7.86% 7.86%

Public - Others shareholding 47.68% 47.68% 38.34%

Non Promoter Non Public Shareholding

- - -

TABLE 6(B): OWNERSHIP & MANAGEMENT RISKS

Market Activity of Promoters

The Promoters of the Company sold their shares in the secondary market in last two

years. Total number of shares sold by promoter and promoter group during the two-year

period is 1,37,33,765 which is 9.33% of their shareholding.

Preferential issue to promoters No preferential issue of shares was made to the promoters in last three years

Preferential issue to others No preferential issue of shares was made to others shareholders in last three years

GDRs issued by the Company The Company did not issue and GDRs in last three years

Issue of ESOPs/Issue of shares other than Preferential allotment

The Company does not have any stock option scheme.

Source - Annual Report




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Glossary

Equity: The equity shares capital of the Company

Net Worth: The amount by which the Assets exceeds the liabilities excluding shareholders’ funds of the Company

Turnover: The revenue earned from the operations of the Company

EPS: Earning Per Share is net profit earned by the Company per share

𝐸𝑃𝑆 =Profit After Tax

Number of outstanding shares

P/E ratio: It is the ratio of the Company’s share price to earnings per share of the Company

𝑃/𝐸 𝑟𝑎𝑡𝑖𝑜 =Price of each share

Earnings per share

Current Assets: Cash and other assets that are expected to be converted to cash in one year

Fixed Assets: assets which are purchased for long-term use and are not likely to be converted quickly into cash, such as land,

buildings, and equipment

Total Assets: Current Assets + Fixed Assets

Investments: An investment is an asset or item that is purchased with the hope that it will generate income or appreciate in the

future.

Finance Cost: The Financing Cost (FC), also known as the Cost of Finances (COF), is the cost and interest and other charges

incurred during the year in relation to borrowed money.

Long Term Liabilities: Long-term liabilities are liabilities with a maturity period of over one year.

Current Liabilities: A company's debts or obligations that are due within one year.

Inventory Turnover ratio: Inventory Turnover is a ratio showing how many times a company's inventory is sold and replaced over

a period.

𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =Sales Turnover

Inventory

Debtors Turnover: Accounts receivable turnover is an efficiency ratio or activity ratio that measures how many times a business

can turn its accounts receivable into cash during a period

𝐷𝑒𝑏𝑡𝑜𝑟𝑠 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =Sales Turnover

Accounts recievables

Fixed Asset Turnover: The fixed-asset turnover ratio is a financial ratio of net sales to fixed assets

𝐹𝑖𝑥𝑒𝑑 𝐴𝑠𝑠𝑒𝑡 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =Sales Turnover

Fixed Assets

Current Asset Turnover: The current-asset turnover ratio is a financial ratio of net sales to fixed assets

𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝐴𝑠𝑠𝑒𝑡 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =Sales Turnover

Current Assets




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Operating Profit Margin: Operating margin is a measurement of what proportion of a Company’s revenue is left over after

paying for variable costs of production such as wages, raw materials etc. It can be calculated by dividing a Company’s operating

income (also known as “operating profit”) during a given period by its sales during the same period.

𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑃𝑟𝑜𝑓𝑖𝑡 𝑀𝑎𝑟𝑔𝑖𝑛 =Operating profit

Sales Turnover

Net Profit Margin: Net profit margin is the percentage of revenue left after all expenses have been deducted from sales

𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡 𝑀𝑎𝑟𝑔𝑖𝑛 =Net profit

Sales Turnover

Return on Assets: ROA tells you what earnings were generated from invested capital (assets)

𝑅𝑒𝑡𝑢𝑟𝑛 𝑜𝑛 𝐴𝑠𝑠𝑒𝑡𝑠 =Net profit

Total Assets

Return on equity/net worth: return on equity (ROE) is the amount of net income returned as a percentage of shareholders’

equity.

𝑅𝑒𝑡𝑢𝑟𝑛 𝑜𝑛 𝐸𝑞𝑢𝑖𝑡𝑦 =Net profit

Net worth

Return on Capital Employed: Return on capital employed (ROCE) is a financial ratio that measures a company's profitability

and the efficiency with which its capital is employed.

𝑅𝑒𝑡𝑢𝑟𝑛 𝑜𝑛 𝐶𝑎𝑝𝑖𝑡𝑎𝑙 𝐸𝑚𝑝𝑙𝑜𝑦𝑒𝑑 =Net profit

Total Debt + Equity share capital

Current ratio: The current ratio is a financial ratio that measures whether or not a firm has enough resources to pay its debts

over the next 12 months. It compares a firm's current assets to its current liabilities.

𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑟𝑎𝑡𝑖𝑜 =Current Assets

Current Liabilities

Quick ratio: The quick ratio is a measure of how well a Company can meet its short term financial liabilities.

𝑄𝑢𝑖𝑐𝑘 𝑟𝑎𝑡𝑖𝑜 =Current Assets − Inventories

Current Liabilities

Cash ratio: The ratio of the liquid assets of a Company to its current liabilities.

𝑄𝑢𝑖𝑐𝑘 𝑟𝑎𝑡𝑖𝑜 =Current Assets − Inventories − Account Recievables

Current Liabilities

Working Capital Turnover ratio: The working capital turnover ratio is also referred to as net sales to working capital. It indicates a

Company's effectiveness in using its working capital.

𝑊𝑜𝑟𝑘𝑖𝑛𝑔 𝐶𝑎𝑝𝑖𝑡𝑎𝑙 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =𝑆𝑎𝑙𝑒𝑠 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟

Current Assets − Current Liabilities

Debt to Equity ratio: The debt-to-equity ratio (D/E) is a financial ratio indicating the relative proportion of

shareholders' equity and debt used to finance a company's assets.

𝐷𝑒𝑏𝑡 𝑡𝑜 𝐸𝑞𝑢𝑖𝑡𝑦 𝑟𝑎𝑡𝑖𝑜 =𝑆ℎ𝑜𝑟𝑡 𝑇𝑒𝑟𝑚 𝐷𝑒𝑏𝑡 + 𝐿𝑜𝑛𝑔 𝑇𝑒𝑟𝑚 𝐷𝑒𝑏𝑡

𝑁𝑒𝑡 𝑊𝑜𝑟𝑡ℎ

Interest Coverage ratio: The Interest coverage ratio is a debt ratio and profitability ratio used to determine how easily a

Company can pay interest on outstanding debt.

𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝐶𝑜𝑣𝑒𝑟𝑎𝑔𝑒 𝑅𝑎𝑡𝑖𝑜 =𝐸𝑎𝑟𝑛𝑖𝑛𝑔 𝐵𝑒𝑓𝑜𝑟𝑒 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝑎𝑛𝑑 𝑇𝑎𝑥

𝐹𝑖𝑛𝑎𝑛𝑐𝑒 𝐶𝑜𝑠𝑡


http://www.investopedia.com/terms/i/invested-capital.asp

http://www.investopedia.com/articles/stocks/05/04405.asp



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Market Cap/Sales ratio: Market Cap/sales ratio, Price–sales ratio, P/S ratio, or PSR, is a valuation metric for stocks. It is calculated

by dividing the company's market cap by the revenue in the most recent year; or, equivalently, divide the per-share stock price by

the per-share revenue.

𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝑆𝑎𝑙𝑒𝑠 𝑟𝑎𝑡𝑖𝑜 =𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝

𝑆𝑎𝑙𝑒𝑠 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟

Market Cap/ Net Worth ratio: It is a valuation ratio calculated by dividing Company’s market cap to net worth.

𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝑁𝑒𝑡𝑤𝑜𝑟𝑡ℎ 𝑟𝑎𝑡𝑖𝑜 =𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝

𝑁𝑒𝑡𝑤𝑜𝑟𝑡ℎ

Market Cap/ PAT ratio: It is a valuation ratio calculated by dividing Company’s market cap to net profit.

𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝑃𝐴𝑇 𝑟𝑎𝑡𝑖𝑜 =𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝

𝑛𝑒𝑡 𝑝𝑟𝑜𝑓𝑖𝑡

Market Cap/ EBITDA ratio: It is a valuation ratio calculated by dividing Company’s market cap to EBITDA.

𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝐸𝐵𝐼𝑇𝐷𝐴 𝑟𝑎𝑡𝑖𝑜 =𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝

𝐸𝐵𝐼𝑇𝐷𝐴

Trading Volume (shares) (avg. of 1 year): Average number of shares/day traded in 1 year

Trading volume (shares) (high in 1 year): Highest number of shares/day traded in 1 year

Trading volume (shares) (minimum in 1 year): Lowest number of shares traded on any one day in 1 year


https://en.wikipedia.org/wiki/Stock

https://en.wikipedia.org/wiki/Market_cap

https://en.wikipedia.org/wiki/Stock



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Contact Information

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Tel +91 22 4022 0322

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[email protected]

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Research Analyst: Waheed Shaikh


mailto:[email protected]

mailto:[email protected]

http://www.sesgovernance.com/