S. R. OILS & FATS LIMITED
On behalf of board of Directors, I have great pleasure in welcoming you to
this 7th AGM & 1st after the Public issue. The directors report and audited
accounts for the year ended 31st March 1994 have been with you some time and
with your permission I shall take them as read.
You are all aware that in the last three years, with Govt. of India
switching over from controlled Economy to liberalization, there has been
alround improvement in Industrial and business Climate. And taking advatage
of delicensing system your company immediately decided, in 1992, to put up
the Vanaspathi Unit, which started Commercial Production in Sept.93
In this 1st AGM after the issue I would like to brief you on the various
stages, your Company has passed through. The company was incorporated in 1987
and commenced production of its 100TPD Solvent Extraction Plant in 1989. The
turn over of your of your company increased from 350 Lacs in 1989-90 to
1563.55 Lacs in 1993-94 giving steady growth year after year.
To Part finance the Vanaspati project, your company came out with a public
issue in Jan.1994 which got good response from the share holders. I am
thankful to all of you for the same. The project was completed within
stipulated time and cost, without any cost over runs. The company launched
its product under the Brand 'KANHA' in 15Kg Tins, Jars and 1kg and 1/2 kg
consumer pack which has been well accpected in the market and shortly we are
going to laugh the product in 200gms pouch also. The Company has got BIS
markfor its Vanaspati Product.
Till a decade back, Vanaspati industry in India was a national industry but
with liberalization and increase in domestic production of oil seeds, and
edible oil, It has become a regional industry and in these times of
competition, the survival of a particular unit depends upon availability of
Raw oil and proximity to it's consumers. Your company thus has inherent
advantage because more than 50% of the raw material is supplied by the Group
Companies in Punjab and Haryana, giving reduced cost of Raw material. The
factory which results in lot of saving in selling cost.
Till now your company was buying about 50% Raw oils from market, but now we
have plans to add Expander/Extruder to our Solvent Extractions Unit. This
will make available about 80% raw material from in house sources at
substantialy cost effective prices.
During the year, monsoon has been quite vigorous and the cultivation of
oilseeds is encouraging, as such there are better prospects of higher
production in current year in Solvent Extraction Unit. The Substantial
improvement in production and availability of oil Seeds throughout the
country for last 3-4 years has increased Production and Consumption of
Vanaspati by 5 to 8% which otherwise showed declining trend from 1988-89 to
Vanaspati is a consumer product and is a cheaper Cooking media than other
oils, so it is also called as "GAREEB KA GHEE" There is good demand of
vanaspati in Haryana, Delhi, UP and other surrounding regions and we expect
good market in these areas. At present Vanaspati Unit is running at about
80% capacity and there is good scope to increase the installed capacity from
present 30MTPD to 50MTPD, which your directors purpose to take up in the near
future. Your directors also propose to put up oil Refinery of 25 MTPD to
produce premium Quality Refined Cooking Oil.
The recent 5 Months working of this year is very encouraging. From April
1994 to 20 Sept. 1994 the turnover of the company is appox. Rs.15 Cr. and we
expect that the turnover in the year 94-95 would be more then 30.00 Cr. and
the profitability will also increase accordingly. In all,the prospects of the
company are very bright.
Your Directorsare happy to recommend dividend @ 10% on pro-rata basis and
hope to give better dividend in the coming years. The company remains
committed to adding value to the stake of our share holders, and fulfilling a
national purpose in the new economic scenario. to this end it is constantly
looking for opportunities within and outside the country. We are also in the
process of negotiating with buyers for export of deoiled cake and in the
coming years we would also try to gain some export market.
The co-operation and support recieved by the company from the Government,
Bankers, our business associates and employees have been a source of great
strength to us .
I conclude by thanking them all and our share holders, including those who
are not present here, for their confidence and support.