Greetings from Deco Group!
On behalf of the Board of Directors of Decolight Ceramics Limited and
on my personal behalf, I extend a warm Welcome to the Twelfth Annual
General Meeting of the company.
The construction industry in India, which is having major linkages with
building materials segments, has been growing at 15% to 20% year on
year, mainly on the strength of increased manufacturing activities,
industrial growth, and heightened investments, especially by the
government in infrastructure and real estate. Vitrified tiles segment,
being one of the building materials segment linked mainly to the
construction landscape has been growing at 25% to 30% per annum, while
the gap in growth rate between Vitrified tiles segment and construction
industry can be attributed to new capactly addition every year in the
wake of the paradigm shift and preferences towards Vitrified tiles in
place of the old and conventional mosaic tiles, marbles and Kota
Being one of the constituents building materials for construction
activities and one of the important sectors in the Ceramic Industry,
Vitrified tile segment is expected to constitute the size of Rs. 4000
Cr out of the Rs. 12000 Cr Indian Ceramic Industry. The production
capacity of Vitrified Tiles has been increased to 5,50,000 sq mtrs per
day contributed by about 55 units which in the year 2009-10 stood at
3,20,000 sq mtrs per day and 40 units respectively. On global front,
the consumption per head of ceramic tiles, which includes vitrified
tiles, comes to 3 to 4 sq mtr in Europe, 1.8 sq mtr in China and 0.35
sq mtr in India. Globally the vitrified tiles segment has been growing
at a rate of 18% per annum over the past three years, accounting for
around 10 - 12% of the total tile production.
While the demand for vitrified tiles is driven by the developments and
growth in construction, realty, housing and infrastructure sectors, it
is expected that expanding construction activities in the largely
untapped rural areas are also expected to provide a huge thrust to the
construction building materials market. Besides, in view of rising
disposable income, rapidly growing middle class and increased
urbanization, etc, it is expected that India''s per capita consumption
of ceramic tiles will have a healthy growth in the periods ahead. While
India growth story continues in spite of inflationary pressures,
indications are that the long term scenario for the ceramic industry in
general and the vitrified tiles segment in particular will remain
For the year ended 31st March, 2011, the revenue from Tiles, Building
Materials and Allied Activities remained at Rs. 14043.32 lakhs as
against Rs. 8199.56 lakhs for year 2009-10. On green power generation
front, during the year under review the revenues were Rs. 336.66 lakhs
as against Rs. 549.69 lakhs for the year ended 31st March, 2010.
Overall for the year under review, the company reported a profit before
tax of Rs. 101.27 lakhs as against the reported loss of Rs. 240.75
lakhs for the year ended 31st March, 2010.
Though the company could manage volume growth in its Tiles, Building
Materials & Allied Activities segments, the margins were affected
because of rising input cost, intense competition in the vitrified
tiles segment and pricing pressures. The manufacturing facilities of
the company remained completely shut down for a period of about 50 days
because of the natural calamity destructions that happened to the
company on 17th of November, 2010. Even after regaining the
manufacturing operations on 1st January, 2011, it took another fifteen
days to bring on track the manufacturing operations in to a regular
flow. Resultantly, the year 2010-11 was very tough and challenging for
the company. While we continue to focus on improving all round
efficiencies and lowering costs throughout the value chains, we are
also preparing for the emerging challenges of rising input costs and
inflationary pressures, etc.
With the objective of reducing the cost of production and at the same
time not compromising with quality, the company already imported and
installed new coal stove plant during 2010-11. However, because of
inflationary pressures and consequent increases in input costs the
company could not pass the cost savings benefit on to its esteemed
customers. Those apart, continuing its cost optimization initiatives
further, the company has imported new polishing line and printing
machines to aid in increased productvity and further quality
For the future, the company has in its agenda to double the capacity of
its manufacturing facilities so as to ramp up the production capacity
to manufacture 24,000 SMPD from the existing 12000 SMPD anticipating
that the construction landscape which includes the constructions and
real estate segments will continue to drive the growth of the ceramic
industry. Also on the agenda is to introduce Nano Technology backed
machinery for manufacturing of high Nano quality Vitrified Tiles so as
to offer the company''s products with manufacturing value addition. On
marketing front, the company''s drive to position its products in
untapped and potential markets continues to get greater thrust and
priority including futher improvement for better delivery systems.
Your Company is committed to the continued adoption and adherence to
good Corporate Governance practices as the Company continues to believe
that implementing good corporate governance practices add value and
thus contribute to the overall performances.
Green initiatives in Corporate Governance
We welcome the Ministry of Corporate Affairs'' Green initiative in
Corporate Governance by allowing paperless compliance to companies.
Accordingly, the company will be taking necessary steps to implement
On Corporate Social Responsibility front, the company is making every
possible efforts. In this context I am pleased to inform that the
company has already made plantation of two hundred environment friendly
plants in the manufacturing premises of the company. Also myself
spearheaded in making the old ghuntu road spanning about three
kilometers adjoining the company''s premises anew among other
entrepreneurs of the Morbi Ceramic hub, as the units in Morbi believe
that unhindered approach roads facilitate the customers reach the
market place at right time.
The investors'' relations were cordial during the year under review.
There was no complaint from investors during the year under review for
which credit goes to Bigshare Services Pvt. Ltd., the existing
Registrar & Share Transfer Agent, who have recently launched Gen-Next
Investor Module i''Boss the most advanced tool to interact with
shareholders. Please log on to i''Boss (www.bigshareonline.com] and help
them serve you better.
Finally, I convey my sincere gratitude to all shareholders and
stakeholders of the Company. I also wish to place on record the support
of Board Members, Customers, Business Associations and Employees of the
Company and the cooperation extended by the government and look forward
the same in the future too.
On behalf of the Board of Directors of the Company, my best wishes for
the periods ahead!
Girishbhai M Pethapara
Chairman and Managing Director
Place : Morbi
Date : August 26, 2011