On behalf of the Board of Directors and myself, I have great pleasure in welcoming you to the Eighth Annual General Meeting of your company.
The Audited Accounts and the Report of Directors' for the year 1993-94 have been with you for quite sometime and therefore I seek your permission to take the same as read:
The Indian Economic Environment is one which is evolving constantly. In Indian industry too is changing to the requirements of the new rules of liberalised business.
Foreign investment is trickling in and it won't be long before this trickle becomes a regular inflow. Indian organisations too are making investments worthy of global status. Global capacities are being set up. Latest technologies being used. There are largely the dictates of the market place where Indian huge middle class, roughly the size of Europe's total population is changing into a discerning demanding buyer.
Investment across the infrastructural, heavy engineering, transportation and consumer goods industries can be expected to account for the increase in per capital consumption of steel from its position of 26 kgs today and bring it much closer to the world range of 150 kgs. With a widest increase upto 31 kgs per capita demand for steel can go into 22 million tonnes by 1996-97 and upto 33 million tonnes by the 21st century. There projection account for a 5-6% Annual growth in GDP.
Ensuring Judicious employment of resources and execution of plans within the given duration has resulted in, as planned, good results for the year ended 31st March, 1994. The year has been a landmark one for your galvanising unit as the production registered a jump of 25% from 40,697 MT last year to 50,708 MT. The capacity utilisation was an impressive 85% of installed capacity.
The turnover of the company registered an increase of 14% from Rs.158 crores last year to touch a new high of Rs.179 crores this year. The Net Profit too rose impressively, by 40% to rise from Rs.523 lac to Rs.733 lacs.
It is a matter of satisfaction that your Directors recommend a dividend @12% for the current financial year.
Commitment to Quality:
The company is manufacturing products meeting major international standards. The commitment to quality of your company is profitably demonstrated in the premium your company's products enjoy over other domestic manufacturers.
With the purpose of acquiring ISO - 9002 certification, the company is now looking forward to continuous implementation of quality standards in procedures and processes, and to help this programme be a success we look forward to co-operation of each and very individual involved.
This year the company achieved another milestone by launching successfully its own Elephant brand of galvanised sheets. The brand has been received favourably in the market and benefits from Brand Equity shall be evident as it consolidates its presence in the market.
As a part of focused marketing strategy your company shall focus its marketing on some sectors especially in the original equipment manufacturing segment and the top while goods manufacturers.
Another area where your company has performed well is the international trade arena. Presently it is exporting its products in bulk to Far East, African and Middle East countries. Exports have risen sharply by 317% from Rs.546 lacs in the last year to Rs.2,277 currently. A warm token of appreciation being The Directorate General of Foreign Trade is the recognition as an Export house valid for the next three years. Further more, due to registration with FIEO (Federation of Indian Export Organisation) as manufacturer exporter the company is entitled for an additional incentive of 3% on FOB value of exports.
Exporting lighter gauge galvanised sheets under its own brand the company is competing with companies from advanced countries like China and Korea. A position few of the India companies are in.
The company's backward integration plan of a Cold Rolling Mill of capacity 60,000 TPA are in an advanced stage project implementation. This will help in further establishing the company's presence in the steel industry.
The company's management has charted out a definite course for the future which envisages a reduction of dependency on external sources of raw material. This will have a direct bearing in the product of the company and its bottom line since in-house value addition is being increased.
The results for 1993-94 have indicated that the company is competitive and can profit even under extreme competition your company has sought competition in global markets and competed effectively.
To further establish itself on the global point and consolidate its domestic position the company is contemplating an expansion in capacities both of its cold rolling and galvanising and setting up downstream value added products.
The lucrative field of power generation for both captive and commercial purpose is one of the various areas that the company is contemplating in terms of diversification.
To recap, it would be an injustice if the efforts, the achievements and endeavours of our work force are not highlighted. With a commitment and dedication second to none and capability to take an international competition, they have proved that they are the most valuable asset the company could have.l