Managing Director''s Message to Shareholders
I am pleased to inform that our Company had a very successful year and has been significantly making progress towards fortifying its identity as a market leader in various niche segments of construction. In view of the positive changes that have happened in the industry, I am optimistic of GENERIC’S ability to sustain growth and emerge a much stronger player than before.
The overall macroeconomic scenario has strengthened with policy support, providing structural strength and imparting efficiency. Interestingly, multilateral institutions like the IMF and the World Bank have endorsed India as a ‘bright spot’ in the global economic landscape, amid reforms with far-reaching positive outcomes. During the year, the Government implemented several radical reforms like GST and RERA.
The implementation of GST has helped to create a uniform indirect tax structure for the entire nation. For the real estate industry, the finalized rates stand at 18% and effectively, this would be 12% as deduction of land value is allowed. The GST reduced the multiple taxes and brought the much-needed clarity to both real estate players and customers. India’s real-estate landscape is also undergoing a major change with the RERA Act, 2016 legislation. The guidelines of the Act empowered buyers of properties, while at the same time enhancing discipline, governance, transparency among the real estate players.
At GENERIC, we understood that at a time when the domestic market conditions were showing signs of revival, it would be prudent to strengthen our capabilities to cater to the vast Indian opportunities. Consequently, our superior growth numbers testify the relevance of our strategies, which are closely aligned to external opportunities and the government’s key policies.
GENERIC delivered a robust performance in FY18: a topline of Rs. 138.32 crore. This, coupled with sufficient order book and improving efficiency, facilitated growth in operating EBITDA to Rs. 19.58 crore and net profit of 11.50 crore in FY2018. GENERIC''S Board has approved a stock split of 1 (one) equity share of face value of Rs. 10/- each to 2 (two) equity share of face value Rs 5/- each. Board has also recommended a dividend of 1% of face value i.e. Rs. 0.10 per share, subject to the approval of shareholders.
Generic Engineering Construction & Projects Limited has received ‘Award of Excellence in Construction and Engineering’ by Make in India Foundation (MIIB). This is a testimony to our performance and client confidence.
We expect to grow at healthy rate but not at the cost of burdening our balance sheet or compromising on our margins. Our Company is among the leading players in niche segments like hospitals and cold storage. Our Company has developed the technical know-how and required skill sets to emerge as one of the best in construction and known for our on time delivery. We strive to be one stop solution of all construction activities. This has increased the trusts of our clients in us, leading to repeat orders.
We believe that several government initiatives - award of infrastructure status to the affordable housing segment, Credit Linked Subsidy Scheme under Pradhan Mantri Awas Yojana (PMAY), extension of income tax benefits up to 60 square meter sized apartments, implementation of RERA and GST - will enhance our sectoral opportunity. Besides, this transformation will benefit organized developers like GENERIC who possess a strong execution focus. We expect these changes combined with lower home loan interest rates to lead to improved consumer confidence and demand. On our part, we will continue to maintain our focus on execution and operational efficiencies, utilizing positive operating cash flows to drive volumes and strengthen our Balance Sheet
With a continued emphasis on project delivery, quality construction, innovation and value enhancement of the entire ecosystem, the future looks promising for our Company. Our success so far has been driven by our most important asset - our team! I would like to take this opportunity to thank each and every member of the GENERIC family. I would also like to thank our Clients, Creditors, Banks, Financial Institutions and other Stakeholders, without whose patronage we could not have been where we are.