CEO AND MD
It is always a pleasure to review performance for the year and share with you plans forthe forthcoming year. The year 2013-14 was indeed an eventful and interesting one due toexternal challenges in the economy as well as developments in the industry.
The global economy continued to face stiff headwinds with key developing economies allstruggling to grow at desired levels. In the USA growth stalled in 2013 to 1.9 per centafter an encouraging 2012 when the economy grew by 2.8 per cent. Retail sales continued toremain disappointing with the key bridal and engagement ring segment remaining flat. TheEU continued to de-grow in 2013 albeit at a lower rate of 0.2 per cent compared to 0.4per cent in 2012. The emerging economies particularly of China and India faced challengeson both domestic and international front with further slowdown in growth compared to theprevious year.
In the Indian Gems and Jewellery industry restrictions on gold imports to reign incurrent account deficits caused a near panic in the industry. The prices of rough diamondsremained high throughout the year squeezing margins. The declining currency furtheraggravated the situation.
In spite of a difficult operating envi ronment there was a marked increase of 12.65per cent in the export of cut and polished diamonds in value terms to US$ 19.6 billion forthe year 2013-14. The import of rough diamonds also increased by 11.98 per cent to US$16.7 billion during the year signifying an increase in cutting polishing and othermanufacturing activities in the diamonds processing space. However there was adiscernible decrease of 39.5 per cent in the export of Gold jewellery & Goldmedallions which stood at US$ 11 billion for the year 2013-14. This was largely due tolimited supply of gold throughout the year imposing restrictions on the extent of tradefor many of the Indian jewellery manufacturers.
Against this backdrop of challenges on both the economic and industry fronts AsianStar delivered yet another excellent performance. Our consolidated turnover for the yearwas Rs. 3250 crore against Rs. 2462 crore in the previous year an increase of 32.01 percent. Our diamond business increased from Rs. 2022 crore in 2012-13 to Rs. 2768 crore inthe current year rising by 36.89 per cent while our jewellery business increased fromRs. 431 crore in 2012-13 to Rs. 476 crore in the current year registering an increase of10.44 per cent. Our margins improved significantly too with our PBT increasing to Rs. 97crore compared to Rs. 62 crore in the previous year while our PAT increased to Rs. 78crore from Rs. 48 crore in 2012-13.
This outstanding performance has been a result of our ENDURING EXCELLENCE. From ourmanufacturing to financial management to marketing and distribution we have been enduringexcellence with our capacities and capabilities. Excellence we have always believed ismore of an attitude and approach than an outcome. Enduring excellence is ingrained andembedded into the very DNA of our company and it is this soft edge of excellence that isproviding us with the thrust to progress ahead powering our success and growth.
We have ambitious plans to maintain our momentum of growth by further expanding ourcapacity and improving upon our capabilities. We are constantly upgrading ourmanufacturing facilities for diamond processing as well as jewellery manufacturing with aclear focus on not only increasing output but also reorienting our manufacturingefficiencies for a stronger focus on special cuts especially in smaller sizes to garnera bigger share of this growing premium segment. In the jewellery business we continue toinvest in our design capabilities and R&D processes to deliver innovations.
As I look ahead I am filled with a sense of optimism and positivity. India has alwayspossessed unbeatable edge in gems and jewellery since ancient times. As a country we havebeen renowned for the best skills and quality in the world. With the right support andpolicies the sector indeed has an immense potential. With economies in key diamond andjewellery markets like the USA and Japan improving and with the Indian economy forecastto pick-up the future looks assured and affirmative.
At Asian Star we are committed to continue with our expansion be it in manufacturingor distribution with a growth-oriented focus to improve efficiencies and deliver superiorproducts and services. We are poised to progress further on the strong trajectory ofgrowth and sustain ENDURING EXCELLENCE not only for our customers but also for all ourstakeholders.
With best wishes
Vipul P. Shah
CEO & Managing Director