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Siemens

BSE: 500550|NSE: SIEMENS|ISIN: INE003A01024|SECTOR: Infrastructure - General
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« Sep 14
Chairman's Speech (Siemens) Year : Sep '15
Dear Shareholders
 
 The macro-economic situation continued to remain challenging in the
 financial
 
 year ended 30th September, 2015. While Government and Public Sector
 spend has commenced mainly in Roads, Railways and Power Transmission
 segments, investments in other major segments such as Defense, Power
 Generation and Distribution, Steel and Cement are yet to improve. With
 surplus capacities currently in the Private Sector, fresh capacity
 additions in various verticals of Food & Beverage, Pharmaceuticals etc
 are also restrained.
 
 The growth of Siemens Limited is closely linked to the growth of the
 Indian economy. For the economy to grow, it is imperative that there is
 an increase in public spending which in turn will fuel demand.
 
 Performance highlights
 
 For the financial year ended 30th September, 2015, the Company received
 New Orders valued atRs, 101,322 million, a 2 percent decrease over Rs,
 103,238 million in the financial year ended 30th September, 2014. Sales
 (excluding Other Operating Revenues) were down by 2 percent to Rs,
 102,831 million, compared with Rs, 104,483 million in the previous
 year.
 
 The Order Backlog as of 30th September, 2015 stood at Rs, 95,894
 million - a decline of 21 per cent compared with Rs, 121,022 million in
 the previous year. Profits from Operations stood at Rs, 7,605 million,
 up by 108% compared with Rs, 3,652 million in the previous year.
 
 For the year ended 30th September, 2015, the Company''s Profit Before
 Tax (including Exceptional Income) stood at Rs, 16,964 million, up by
 101 per cent compared with Rs, 8,436 million in the previous year. The
 Profit after Tax for the year was Rs, 11,833 million, up by 96 percent
 compared with Rs, 6,032 million in the previous year.
 
 The Board of Directors recommended a Dividend of Rs,6 per equity share
 and a Special Dividend of Rs,4 per equity share (in view of the large
 exceptional income during the FY 2014-15) having face value of Rs,2
 each for the financial year ended 30th September, 2015. The Company had
 paid a Dividend of Rs, 6 per equity share during the previous financial
 year.
 
 Performance Analysis
 
 From an operational point of view, the Company continued its focus on
 the Customer while also driving operational excellence. There were a
 few key highlights during the financial year.
 
 The Energy Management Division of the Company further strengthened its
 partnership with Power Grid Corporation of India Limited for upgrading
 the national grid from 765kV to 1200kV. It also received orders to
 supply Gas Insulated Switchgear substations. In addition, the Division
 is supporting various State Power Distribution companies in modernizing
 their infrastructure by implementing Smart Grid technology (SCADA/DMS).
 These solutions contribute to improvement of efficiencies in the
 nation''s power transmission and distribution system.
 
 The Power and Gas Division maintained its market share position while
 operating in an environment where new Capital Expenditure in the
 Private Sector has been put on hold and Public Sector tenders were not
 announced.
 
 The Digital Factory, Process Industries and Drives and Healthcare
 Divisions were able to maintain market share while growing at a
 reasonable rate. The Building Technologies Division continued to grow
 appreciably while gaining market share and the Mobility Division won a
 couple of good orders from Diesel Locomotive Works but was unable to
 grow substantially.
 
 In the area of Smart Cities, Siemens signed a Memorandum of
 Understanding with the Confederation of Indian Industry and
 subsequently formed a Consortium with 9 other companies and 2 banks to
 address the needs of cities. Siemens also signed a separate MOU with
 Infrastructure Leasing & Financial Services and Gujarat International
 Finance Tec-City Company Limited to develop Smart Mobility Solutions
 for Gujarat International Finance Tec-City. With the thrust being put
 by the Government on Smart Cities, we are confident that Siemens is
 well positioned to address this very important market.
 
 
 Business Responsibility
 
 The Company is committed to acting responsibly to achieve economic,
 environmental and social progress. During the financial year, the
 Company further strengthened its focus on customers while also
 addressing the various needs of its employees. Substantial work has
 also been done in the area of CSR. In this regard, Siemens Limited
 follows the guidelines set for Business Responsibility Reporting (BRR)
 while working towards the goal of responsible and sustainable
 development.
 
 People Excellence
 
 During the financial year, the Company continued its focus on retention
 and development of talent. Many initiatives have been taken by the
 Company''s Human Resources team and the Divisions to make the Company
 the most preferred engineering company in India.  The initiatives,
 which are ongoing, are centered around Learning and Development, Health
 Management, Environmental Protection, Health and Safety.
 
 The Road Ahead - the Outlook for Siemens Ltd.
 
 Looking ahead, with private sector capital expenditure getting
 deferred, the growth drivers for the Company clearly lie in increased
 public sector investments in Power Generation, Transmission,
 Distribution and Mobility. Opportunities in the form of large tenders
 are awaited for High-Voltage Direct Current solutions, Metros, Electric
 Multiple Unit Locomotives, Ultra-Mega Power Projects, etc.
 
 In such a scenario, the Company''s strategy is focused on three aspects:
 profitable growth in new orders, selective participation in large
 orders with profitability being the key driver and continued focus on
 operational excellence and cash. We have the commitment of our parent
 company''s Managing Board, which incidentally visited India to review
 and express their support for this strategy.
 
 I am confident that with the Company''s strengths and competencies in
 Electrification, Automation and Digitalization, it can deliver on the
 Government''s initiatives of Make in India, 24/7 Power for All and Smart
 Cities as also serve the needs of the modernization of the Indian
 Railways.
 
 In conclusion, I would like to sincerely thank our Customers, the
 Board, Management, Unions and most importantly, the dedicated employees
 for their consistent support and commitment to Siemens Ltd. during
 another challenging year.
 
 Deepak Parekh Chairman
Source : Dion Global Solutions Limited
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