2003 could be summed up as a year that has put your company into a
Before I dwell more on that, let me share with you the performance of
your company that has been quite satisfactory.
In 2003, your company improved the topline by 56% to Rs 289.35 cr and
the profit after tax increased by more than that proportion by 112% to
Rs 45.75 cr. Interestingly, the company achieved its highest ever sales
and profits in 2003 in just five years into getting into a highly
difficult gelatine business, which has only 25 global manufacturers.
Your company also reported the highest ever EBIDTA margin of 50%,
perhaps the highest among all gelatine manufacturers! In 2003, your
company was ranked 8th in a shareholder wealth creation survey by
Motilal Oswal Securities Limited.
The reasons are manifold.
Your company's commitment to quality product, high customer
responsiveness (through inventory), an ideal mix of domestic and global
revenues, constant product upgradation and stringent cost control
measures are some of them.
I take this opportunity to thank every member of your company for making
Now let me share with you the developments in 2003 that has put your
company into a growth trajectory.
Domestic market expansion through acquisition
In 2003, Sterling acquired the 2000 tonnes gelatine capacity of Rallis
India Limited, a TATA Enterprise for an all cash deal of Rs 47 cr that
will increase the company's capacity to 10,200 tonnes, taking its
global share to almost 4% of the total gelatine industry and10% in the
pharmaceutical gelatine industry. In India, with this acquisition,
Sterling becomes the undisputed leader In gelatine with a market share
of over 60%.
Global market expansion through new capacities
Sterling has constantly added new capacities over the past few years.
The process to set up greenfield capacities continues. Sterling's long
term vision is to take 10% share of the global gelatine market and we
will add capacities till we reach this target. The India advantage
coupled with our commitment to technology, R&D, quality and regulations
will help us gain a foothold in the overseas market, where a number of
Fortune-500 pharmaceutical companies already source their gelatine
requirements from us.
Till 2003, your company was listed on the Indian stock exchanges and
has been ranked for the last two years in wealth creation study
undertaken in India. In 2003, Sterling Issued $15 million GDR and
listed itself on the Luxembourg Stock Exchange providing global
visibility. I believe that with this listing access to International
funds at competitive rates will help the company expand further.
Going forward I am optimistic about the company's outlook. Having put
the company on a growth trajectory. Sterling is confident of its
performance in the future. Moreover, with Investment in technology and
R&D, Sterling will get more customers and get a higher share from the
existing customers and move closer towards its vision of a 10%share of
the global gelatine industry
I thank you for your continued support.
Chairman and Managing Director