Prozone may get listed in 30 to 45 days: Nikhil Chaturvedi, Provogue

In an interview with ET Now, Nikhil Chaturvedi, MD, Provogue, speaks about the de-merged entity – Prozone. Excerpts:


ET Now: What happens to the existing Provogue now? What are the kind of business which are still existing and what is the course ahead for this listed entity over the next 12 months in terms of revenues and profitability?

Nikhil Chaturvedi: Let me explain that the results of the Prozone Capital Shopping Centre - the other entity which has been demerged - were not part of this balance sheet at all because it was a separate subsidiary and it used to show only in consolidation. So the results of last year and of the last nine months are basically the results of Provogue alone.

I believe that Provogue’s business is equally robust. That is the mother company and our growth estimates remain as planned. The last nine months have been reasonable for the company and we should be able to close the year as targeted, ie. about Rs 33 to Rs 35 crore after tax profit.

ET Now: What about your manufacturing? The company owns two plants in Daman as well as Baddi. Give us a sense of the current capacity as well as utilisation levels that you are working with and what is the capex plan that you have outlayed for FY13?

Nikhil Chaturvedi: The two manufacturing plants, which we have in Daman and Baddi, they produce about 1.5 million garments per year and they are running at a capacity of about 75% and the remaining inefficiency is more because of the number of days lost. They are running at almost close to capacity. For the coming year the capex will be in two or three terms.

The company is foraying into the future in terms of the using other distributions channels, for that we will be spending some capex except for that the company is making a major initiative into e-commerce. When I say e-commerce, we are talking about Provogue being sold online. We believe it to be a business of the future and that is something which we have been working on and there will be a reasonable amount of investment into e-commerce.

ET Now: So what is your funding requirement exactly?

Nikhil Chaturvedi: It would be in the range of about Rs 45 to Rs 50 crore and that should be funded internally.

ET Now: What do the existing shareholders of Provogue as a result of the demerger get? Do they get anything aside of the currently listed entity?

Nikhil Chaturvedi: The existing shareholders have got the entire shares of Provogue. Plus they have got a 1:1 share of Prozone. Prozone should also get listed in the next 30 to 45 days.

ET Now: You did mention that the numbers that were posted by Provogue even before this demerger did not account for a Prozone. Surely your consolidated numbers had the results of Prozone as well. I am guessing it was over 51% that you had?

Nikhil Chaturvedi: Till last year Prozone was in an incubation stage where we were only investing money. So whatever it was showing even in consolidation was being shown as investments. Actually the reason for the demerger is because we expect that the company would become equally strong and hence it has been demerged to become an independent entity now. In that business we have launched about three residential colonies in the current year, the financials of which will start showing in the next financial year and as a result of that we have decided to demerge the business.