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Gujarat State Fertilizers & Chemicals Ltd.

BSE: 500690 Sector: Agri and agri inputs
NSE: GSFC ISIN Code: INE026A01025
BSE LIVE 10:18 | 23 Oct 137.95 0.25
(0.18%)
OPEN

138.85

HIGH

139.75

LOW

136.20

NSE 10:08 | 23 Oct 137.30 -0.40
(-0.29%)
OPEN

138.60

HIGH

139.50

LOW

136.30

OPEN 138.85
PREVIOUS CLOSE 137.70
VOLUME 148990
52-Week high 150.75
52-Week low 78.50
P/E 13.29
Mkt Cap.(Rs cr) 5,497
Buy Price 137.70
Buy Qty 322.00
Sell Price 137.95
Sell Qty 1138.00
OPEN 138.85
CLOSE 137.70
VOLUME 148990
52-Week high 150.75
52-Week low 78.50
P/E 13.29
Mkt Cap.(Rs cr) 5,497
Buy Price 137.70
Buy Qty 322.00
Sell Price 137.95
Sell Qty 1138.00

Gujarat State Fertilizers & Chemicals Ltd. (GSFC) - Chairman Speech

Company chairman speech

ANNUAL REPORT 2000-2001 GUJARAT STATE & CHEMICALS LIMITED CHAIRMAN'S SPEECH LADIES & GENTLEMEN, It gives me great pleasure in extending to you all a hearty and warm welcome to this 39th Annual General Meeting of the Company. I earnestly thank you for sparing your valuable time to attend the meeting. The Annual Report containing the Directors' Report and the Audited Accounts for the year ended 31st March, 2001 has been with you for some time and I am sure you have had me opportunity to peruse them. ECONOMIC SCENARIO: Indian economy is presently passing through a difficult phase. Though the year started on a positive note with expectations of rise in demand and industrial activities, these could not materialize essentially because of erratic monsoon, droughts and the devastation caused by me killer earthquake that struck the Gujarat State early this year, as well as the melt down of the capital markets. Consequently there was poor demand and sluggish industrial activity. The implementation of WTO), fears of slow down in the US economy and the sharp rise in global crude oil prices compounded the pressure. These macro-economic developments had adversely impacted practically all segments of the Indian economy. Fertilizers, Chemicals and Petrochemicals sectors are not an exception to this. The Fertilizer Sector is in a state of flux. The Govt. is yet to make a firm policy announcement for Fertilizer pricing and me time schedule for its implementation. The Expenditure Reforms Commission (ERC) constituted by me Government of India to suggest reforms in fertilizers Pricing Policy has suggested complete decontrol of Urea price as well as the movement and distribution by 2005-06. The retention price is suggested to be discontinued from 1-2-2001 and it is contemplated to introduce a fixed concession scheme. However, the method of implementation of ERC's recommendations and the time frame thereof are yet to be decided by the Government. The current recession worldwide is expected to last for some time to come. Till that time, it will be necessary to hold on and fortify our position to sustain the economic jerks. THE YEAR: The year under review has many distinguishing and heartening features. * Highest sales turn over of Rs. 2138.30 crores. * Substantial increase in operating profit from Rs. 242.14 crores in the previous year to Rs. 317.01 crores. * Ever highest export c Rs. 188.85 crores against the previous best of Rs. 144.41 crores in 1999-2000. * Ever highest sale of 10582 MTs of Melamine in domestic market as against 7819 MTs. in 1998-99. * Ever highest yearly production of 49731 MTs. of Cyclohexanone surpassing the previous best of 45624 MTs. in the year 1999-2000. * Permanganate Number (PN) is an important quality parameter for Caprolactam. Against the 10,000 PN, your Company achieved quality of 20000- 25000 PN. * Ever highest sale of Gypsum:- 4.14 lacs tonnes as compared to 3.83 last year. This is despite severe drought conditions in Gujarat. IMPORTANT FACTORS AFFECTING THE PROFIT: Let me share with you my concern about the lower profitability of the Company arising out of some peculiar circumstances. During the year under review, there was a recovery amounting to Rs. 210.55 crores by FICC towards subsidy for the period . from 1982 onwards. Due to the commissioning of 1350 MTPD Ammonia-lV Plant and the rehabilitated Nylon-6 Plant, the additional burden of Rs. 53.42 crores towards interest and Rs. 44.83 crores towards depreciation attributed to lower profit. Coupled with these, payment of Rs. 13.47 crores towards additional water charges imposed by the Government of Gujarat from 1-4-1997 further restricted the profit. Your Company has undertaken urgent and strict measures to reduce expenditure on all fronts and you will be happy to note that there has been a substantial decrease in the administrative expenditure. I am happy to inform the progress in me various ongoing projects / schemes. FDAP EXPANSION PROJECT AT SIKKA: Progress for the establishment of the 3rd train of DAP at Sikka with a capacity of 3.96 lacs MTs. per annum was about 90% upto 31-3-2001. It is expected that the plant will be commissioned by me 4 quarter of financial year 2001-2002. We have been able to bring about sustained progress in spite of the problems of non-availability of labour at site after the earthquake and severe liquidity crunch. UREA CAPACITY RE-ORIENTATION PROJECT: Taking cognizance of certain policy announcement by Govt. of India with regard to futuristic fertilizer policy, the impact of WTO and the report of Expenditure Reforms Commission regarding subsidy levels for ferblizers (Urea), the earlier scheme to revamp the entire Urea Plant is being re- conceptualized with specific emphasis on reduction in energy consumption, which alone could attract incentive under the new policy regime. "De-super heater for Urea-I & 11 Plants" - Scheme, for energy saving was completed and commissioned on 2.3.2001 in (U-I) and 3.7.2000 in (U-II) respectively. Consumption of steam for production of Urea was reduced after implementing me scheme. This was one of the major achievements during year for energy saving program. R&D: Significant headway has been made in the area of corrosion and material evaluation, environment control, cooling water consumption conservation, waste management, bio-technology and analytical service, fertilizers and chemicals. For the on-line corrosion monitoring systems, your Company has executed an agreement with M/s. COROMON, UK and M/s. NALCO, USA based on which, it has been possible to offer consultancy services to other interested entrepreneurs, which paid rich dividends. R&D has developed knowhow for fire retardant Grade Nylon-6, which is eco-friendly. Commercial production of this product is being taken up in the Fibre Unit. Your Company continues to give priority to agriculture related aCtivities. It is heartening to note that your company's Bio-fertilizer Unit has been awarded "FAI Award -2000" for "Production, Promotion & Marketing of Bio- fertilizers". This honour is a validation of your Company's commitment to strengthen country's agricultural economy. During the year, the Company trained 117 farm youth which is more by 92% than the previous year. This gives us an humble sense of fulfillment and pride in the fact that we are helping shape me youth - the future citizens of our State and the Country. Upon successful launching of Production & Sales of different varieties of Tissue Culture Banana plants, we have standardized & developed the micropropagation protocol for seven important genotypes of sugarcane successfully. After conducting field trials for the last 4 years and ensuring the quality of the plants, the commercial distribution of Sugarcane plants commenced from March 2001. To march with me advancing science in the field of Bio-technology world over, your Company has made a modest beginning in that direction. The AD & AS wing of the Company has announced various packages of modem Bio- technology to reach the farmers through our depots. This includes the knowledge on recent biotech advances plus a package of high-tech Green Houses for the farmers. Plant breeding research on Bajra, Cotton & Tur is progressing. During the period of report, 3 hybrids in Bajra, 2 hybrids in Cotton and 2 varieties in Tur crops were found promising, having higher productivity &reasonable resistance to diseases & pests. UTILITY AND ENVIRONMENT CONTROL: Your Company believes in eco-efficiency un sustainable development. With a view to achieve stricter norms for NOX emissions and to comply with GPCB norms, a Be-Nox Unit based on selective catalytic reduction process with a proprietory catalyst and know-how from M/s. CRI, Netherlands, a subsidiary of M/s. Shell International jointly with M/s. ADOR SAMIA Ltd., Pune was installed in Caprolactam-l Plant at an estimated expenditure of Rs. 5.3 crores. The same was commissioned in August, 2000. SOCIAL COMMITMENT: Your Company continues to care for its neighbours. The Company has constituted a Village Development Cell which continuously reacts with the village community to understand their problems and render help to the extent possible. Immediately in the aftermath of the earthquake that struck parts of Gujarat, your Company contributed its mite to the efforts of the massive relief work undertaken by the State Government by sending a team of Doctors with ambulances, Showel Loaders-cum-Excavators (JCBs), Fire Tenders, Gas cutting sets and "Snorkel" for high rise buildings. GSFC parivar also helped by way of sending tents, food grains, clothes to the affected areas. But special mention must be made about 100 employees of your Company who showed exemplary dedication in attending to relief and rescue work in different teams as per the directives of the Relief Control Room in affected areas, particularly in Bhachau, Anjar and Ahmedabad. They deserve our kudos for this unique quality of social commitment and we are indeed proud of them. VOTE OF THANKS: I welcome the appointment of Shri Balvant Singh who has recently assumed charge as the Managing Director. I also wish to express my sincere thanks to my colleagues on the Board for their guidance and valuable contribution. Dr. PK Das retired from the Government service on 30-6-2001. Shri AD Desai was given the additional charge as MD-GSFC till Shri Balvant Singh assumed charge. Shri PK Taneja, who was appointed as a whole-time Director with effect from 6-7-2000 resigned on 28-2-2001 (after office hours) after he was appointed as Managing Director - Gujarat State Electricity Corporation, Vadodara. I also particularly thank Shri G. Subba Rao, who, in spite of his busy schedule as the Chief Secretary of the Government of Gujarat, continues to contribute to the deliberations of your Board. My sincere thanks are due to Govt. of India, Govt. of Gujarat, IDBI, UTI, IFCI, ICICI, LIC, GIC and other Indian Financial Institutions as well as International Financial Institutions, SEBI, Stock Exchanges, NSDL, CDSL, Banks and other agencies for their co-operation, assistance and support extended to your Company. I also wish to express sincere thanks for the dedicated and untiring efforts put in by the Officers and Staff of your Company. I also salute the unshakable faith shown by the Shareholders in the Company and I owe and express my sincere thanks to them. Finally, I wish to thank our innumberable consumers, dealers, suppliers, well- wishers and press and the media for their continued and unstinted support. JAI HIND (Statement of Dr K. D. Jeswani at the 39th Annual General Meeting held on Friday, the 28th September, 2001. This does nd purport to be the proceedings of the Annual General Meeting) GUJARAT STATE FERTILIZERS & CHEMICALS LIMITED Registered Office: PO: Fertilizernagar- 391 750, Dist: Vadodara.