Assignment 3

Fin 444.2
Instructor: Mirza M. Ferdous (MzF)

Prepared by Name | ID | Tarek Al Zobaer | 1010052030 | Tamanna Badhan | 1020716020 | Sabreen Sayeed Haider | 1130637030 | Omar Farukh | 1210010030 |

Date of Submission : 05.05.2015

Overview of Singer Bangladesh
Singer Asia is a holding company with operating subsidiaries in the South Asian countries of Sri Lanka, Bangladesh, Pakistan, and India. The subsidiaries in Sri Lanka, Bangladesh and Pakistan are retail businesses engaged in the distribution of a wide variety of household consumer durable products (HCDs), with consumer credit and other financial services available to qualified customers. In each of these markets, Singer Asia is the leading retailer of durable products for the home.

Singer Bangladesh History
The presence of Singer in Bangladesh dates back to the British colonial era when the country was a part of the Indian sub continent. The first operation of Singer began in the year 1905. Later, in 1920, two shops were set up in Dhaka and Chittagong. Operation of Singer began in 1905. Later, in 1920, two shops were set up in Dhaka and Chittagong. After the partition in 1947, Singer in East Pakistan operated as a branch of Singer Pakistan. When Bangladesh was liberated in 1971, East Pakistan branch office was elevated to a country Office.
Firstly, Singer was synonymous with sewing machine. Later in 1985, its management diversified its products into different ranges including televisions, fans, washing machines, irons, microwave ovens, rice cookers, audio products, air conditioners, motorcycles, instant power supply, DVD players, room heaters, kitchen appliances, netbook, laptop, desktop computers and generators. A change in the investment policy in 1979 created new business opportunities and Singer registered as an operating company, with 80% of the share held by Singer Sewing Machine Company (SSMC), USA, and 20% by local shareholders. In 1983 the company was listed with Dhaka Stock Exchange (DSE) and offered 20% of its total capitalization- 2,565 ordinary shares of Taka 100 each. In 2001, it was also listed with the Chittagong Stock Exchange (CSE).

Management practices
Directors are responsible for instituting a system of internal controls to ensure the effective implementation of all policies and decisions of the Board. The Board ensures that the Directors maintain full and effective control of all significant strategic, financial, organizational and compliance issues. The Directors have delegated to Management Committee the responsibility of establishing and implementing a system of internal control appropriate to the business environment in which it operates.

The Company's internal controls are highlighted as follows: * The definition of the organizational structure and appropriate delegation authorities to functional management. * Procedure for the review and authorization of capital expenditures. * Strategic planning and the related annual planning and quarterly forecasting process. * Accounting and financial reporting policies to ensure the consistency, integrity and accuracy of the Company's accounting records. * Reporting and review of financial results and other operating statistics as well as the Company's published half yearly and annual financial statements which are based on a standard reporting system.

The Company has an internal audit department consisting of twelve members and headed by the Head of Internal Audit. The internal control system is maintained and reviewed by an internal audit function that operates on a global basis and reports to the Management and the Audit Committee. The work of the internal auditors is focused on the areas of risk to the Company which is determined on the basis of a risk management approach to audit. The Company has several levels of personnel enforcing these internal controls, while the Internal Audit Department reviews the effectiveness of such controls. Company operations are also subject to be reviewed by the Corporate Internal Audit Division of the parent Company of Singer Bangladesh Limited.

New Role of Singer Bangladesh – Retailer
Gradual transformation of Singer Shops into 'Singer Mega' and 'Singer Plus' started back in 2006 as part of its multi-branding strategy. The main focus of this strategy is to make available varied world famous brands under the same product category for providing customers a variety of choice under the same roof. As such Singer Mega and Singer Plus Shops now offer world famous brands like BEKO, Grundig, Apple, Samsung, Siemens, Skyworth, Videocon, Preethi, Singtech, Dell, Toshiba, Prestige, Lifestraw and many more alongside with Singer.

Manufacturing
Singer set up its first manufacturing facility for sewing machines in 1980 at Chittagong. 1993 saw the most successful diversification program of the company when its product range was enhanced with the establishment of a new Audio Video Plant at a rented premise at Savar near Dhaka. Initially, production was limited to Color Televisions but in 1994, Video Cassette Players were added to the product range. From early 1995, production of the Black and White TV was also started at the same plant. The company also initiated assembling of Washing Machines in 1996 at another rented premise. The company established Singer Electronics Complex on its own land at Savar, at the outskirt of Dhaka. The complex assembled Radio Cassette Recorder, Washing Machine, Sewing Machine at different times. SMC started assembling state of the art LED televisions from 2011 maintaining the global standard of quality. It is also assembling CRT Televisions. In 2013 Singer's manufacturing facilities went for further expansion by commencement of Singer Furniture manufacturing at the Complex. Besides, Singer started manufacturing Air Conditioners at the same premise in 2014.

Dealer Channel
Despite offering the largest retail chain for Consumer Electronics and Home Appliance industry in the country, around 300 dealers are located across the country to make Consumer Electronics & Home Appliances of Singer and other brands, Singer Cables and Sewing Machines available to more consumers.

Investor Relations
Singer, the company famous for hire purchase schemes and sewing machines, is the largest retailer in Bangladesh. As the country’s largest retail chain, Singer manufactures and markets consumer electronic, home appliances, motor cycle, electric cables and many more. Singer Bangladesh markets products through two distinct channels - its own retail chain shops – Singer Plus and the Dealer Channel. It has presence at the every corner of the country.

Analysis of the Singer’s financing methods
Singer Bangladesh Limited has earned Tk 5,461.23 million in revenue in the year 2011, recording 13.1 per cent growth compared to the previous year. Despite different challenges including global economic crisis and currency devaluation that impacted the economy in 2011, Singer Bangladesh became able to achieve its revenue targets,' Mahbub Jamil, Chairman of the company said. The sustainable and profitable growth of Singer Bangladesh will continue in the future, Mr Jamil hoped at its annual report-2011. "Our key strengths, being our singer brand, our nationwide distribution network, our ability to offer hire purchase and most importantly our Singer staff, will continue to enable us to produce strong results going forward," he added. "As a leading corporate house and a listed company, Singer is trying to establish the best investor relations practices through effective communication with its investors and other shareholders," Mr Jamil said. AM Hamim Rahmatullah, Managing Director and CEO of Singer Bangladesh, said though the year 2011 was undoubtedly a difficult year for the Bangladesh economy, 2011 saw a growth in almost all of major product lines of Singer. Singer Bangladesh now has Authorised capital of 1000,000,000 ordinary shares of Tk 10 each
Of which Issued, Subscribed and Paid Up capital is 61,355,593 ordinary shares of Tk 10 each. And the number of Shareholders as on December 31, 2014 was 14,582.

* In the year 2011, sales turnover of the listed company recorded Tk 5,461 million, which is 13.1 per cent higher than that of previous year. * The company's operating profit increased to Tk 503 million in 2011, registering 1 per cent growth, from Tk 498 million in 2010, according to the annual report 2011. * Total reserves of the company stood at Tk 277.82 million in 2011 while its paid up capital is Tk 392.68 million as of December 31, 2011, which was Tk 224.39 million in 2010. * As of December 31, 2011 Earning Per Share of the company is Tk 10.18. * During the year 2011, there was an up and down movement in share price of the company. The highest share value was Tk 840 and the lowest was Tk 209. * The Board of Director of Singer Bangladesh recommended 30 per cent cash dividend (Tk 3 per share of Tk 10) for the year 2011 based on the performance of the company. * In refrigerators, a 28 per cent growth was registered, the panel television growth was 149 per cent and sewing machine sales grew by 57 per cent. * The company's computer business comprising Singtech and Samsung brands saw a remarkable growth of 63 per cent in 2011 compared to the previous year. * A strong growth-- 153 per cent and 27 per cent-- was also recorded in the washing machine and microwave products versus the previous year.

CSR Initiatives
From its sense of moral obligation to the society, the company undertook different projects under the Corporate Social Responsibility (CSR). Singer's CSR activities in 2011 include Kingbodonti or Bravery Award, mother and child care awareness programme and training for the destitute women. Credit Rating Company (ECRL) rated Singer Bangladesh Limited AA+ in the long term and ECRL-1 in the short term with a stable outlook.
Singer Bangladesh obtained "D & B Corporate Award 2010" for its business performance in 2010 while the company's annual report 2010 won the Merit award from the ICAB National Awards in the manufacturing sector for best published accounts and reports.

Views for the future
Managing Director of Singer Bangladesh Mr Rahmatullah, while sharing his views regarding the future prospects of the company, said, "The Company continues to have its strongest distribution network for consumer durables in Bangladesh. This was further strengthened with opening of 30 new shops in 2011. "The whole sale market was also strengthened with many new dealers joining hands with Singer Bangladesh for the first time, he noted. “The company has the best after sales offering and will continue to strengthen it," the managing director said. Singer Bangladesh lays stress and focused on efficiency of the employees for improving the company's performance, thereby focusing on training their employees both on and off the job.

Singer Bangladesh has the following objectives for its future growth : * To be the market leader in our product range and market segment. * To provide consumers with the best services and shopping experience. * To provide consumers with products of latest technology. * To develop our employees to achieve their real potential. * To provide our shareholders with steady asset growth and return on investment above our industry norm. * To grow our revenue and profits at a rate above the industry norm.

References 1. Singer Bangladesh Annual Report, 2013 2. http://www.singerbd.com/