Priti International Ltd. is engaged in the business of manufacturing and exporting handicraft products. Their products include Wood & Metal Furniture, Refurbished waste material and textile handicrafts. They are located in Jodhpur and they have 2 Manufacturing Facilities in the city.
First we will have to clear a few things up about Priti International Ltd. Priti International Limited was incorporated in November, 2017. Before 2017, the promoters ran a proprietary firm called Priti International. Priti International has been in operation since 2005 and in 2017, it was acquired by the company we are talking about i.e. Priti International Limited.
Considering, Priti International Limited has only been in operation for a few months, in all discussions further, we will be concerned, only with Priti International and not Priti International Ltd.
Before writing this review, we thought we would buy something from Priti International’s Website to test out how they match up to other handicraft products. That’s when we met our first surprise. We couldn’t buy anything. Whenever we’d add something to our cart, the website would redirect us to the home page. In fact, none of the links on the website worked and we were beginning to think this was only a dummy website. But then, we clicked on a link that said “Prospectus” and found the DRHP (Draft Red Herring Prospectus) of Priti International Ltd. So it was not entirely a dummy website after all.
Dummy Products Too?
We then ran a google image search on some of the products listed on the website. And we found out that most of the products listed on their website were listed on Amazon by different sellers as well. So we were forced to conclude that the products listed on their website were also dummies.
This made sense because Priti International sells mainly to wholesalers and Retailers and so, we are assuming that the website is only a display/landing page and nothing else.
Say what you will about the website, but Priti International makes ingenious products. We know this because History Channel ran a small segment talking about the beautiful products they make. The manufacturing facility and the product portfolio is there for the world to see. The novelty factor is so high that almost all of their sales come from outside India.
While it is noteworthy that they generate most of their revenue outside India, it must also be said that close to 93% of their revenue comes from about 10 customers in total. Where are these 10 customers located you ask?
In Spain, Belgium, Holland, Netherlands, Turkey, England, China, Greece, Germany etc as of 2017.
| Country | % of the Total Revenue |
|---|---|
| Holland | 45% |
| Spain | 15% |
| USA | 14% |
| China | 7% |
| Others | 19% |
18 Cr
1.64 Cr
So Priti International made sales worth 18 Cr. in FY 2016-17. These numbers, combined with the ingenuity of their products, look decent until you are forced to look at the big picture. Their sales have largely remained stagnant since 2013 shifting between 18 Cr. and 20 Cr. and we must confess that the company has maintained remarkable consistency on this front. Only problem, is that consistency of this sort in your income statement is not really a good thing per se.
Their profits too have remained in a fixed range between 1Cr. to 2 Cr. since 2013 and the DRHP doesn’t quite provide us with intimate details on how they plan to increase their top/bottom line.
The stated miracles have not yet materialized. In fact, last year two unidentified assailants fired several bullets on the promoter. According to the FIR, the assailants attacked the promoter with the intention to kill, intimidate and extort. The police have arrested the accused and the matter is currently under investigation.
Finception, Ideapad, CIIE
IIM Ahmedabad, Vastrapur Ahmedabad - 380015
Email: [email protected]
Phone: +91 80076 94666
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