It gives me immense pleasure to address you at the end of another successful year. Theyear 2015-16 was of steady and stable growth. We exercised great caution during the yearbecause the external environment was volatile and largely unpredictable. We successfullyincreased our production efficiencies and implemented multiple initiatives to enhance ourpreparedness for your company's resurgence in the iron and steel sector. We are today moreequipped and confident that our foresight is taking us towards the right direction andlong-term sustainability.
Economic Out look and Industry
Global economic recovery during the year remained sluggish fragile and uninspiring.In advance economies the recovery was modest and largely uneven. The US economy performedwith resilience supported by relatively easy financial conditions with strengtheninghousing and labour markets. In the European economy robust private consumption supportedby lower oil prices and easy financial conditions outweighed the weakening net exports.
The scenario for emerging markets and developing economies is not very encouragingeither. China is on a rebalancing mode; it is navigating a momentous but complextransition towards a more sustainable growth. Given China's important role in globaltrade the rebalancing efforts can have substantial spill-over effects especially onemerging market and developing economies.
India continued to be one of the most attractive economies by common consensus. DuringFY 2015-16 the economy grew by 7. 6% and the government took considerable measures tousher in a culture of fiscal consolidation. The government is focusing on across the boardreforms to spearhead infrastructure development in railways roads and highways as well asthe power sector to build a broad-based foundation for accelerated socio-economicdevelopment.
The year 2015-16 ended on a positive note. We saw good recovery of steel prices in thedomestic market which for the past 18 months had slumped to an all-time low. Moreoverintroduction of minimum import price (MIP) also helped to curb the rapidly growingimports at predatory prices. More importantly demand was stagnant for most of the year;and the marginal demand growth benefited the importers.
The indigenous steel producers failed to become true beneficiaries of the fledglingdemand growth.
In this context it is pertinent to mention that the government's Make in Indiainitiative has been a resounding success. After the launch of Make in India FDI inflowshave increased by 37% (Source: Ministry of Commerce and Industry).
Your Company's Performance
A growing and competitive manufacturing sector has become the prime mover of the moderneconomy. Your Company's main focus is customer centric and about keeping Customers happyin a very demanding environment. Company believes that the salesperson is the star andneeds to have sharpened skills and processes that keep the empowered Customer happy. YourCompany has delivered strong operational performance in FY 2015-16 with relentless focuson cost discipline and improved productivity across all our operations that enabled us todeliver strong earnings and record cash flow. As a result your company reduced debt andstrengthened its ability to withstand volatility in the tough and challenging commoditiesmarket during the year. The strength of business is determined not by how well they do ingood times but in how courageously they sustain periods of uncertainty and challenges.During 2015-16 your company have witnessed unprecedented challenges but remainedsteadfast to the belief to counter these challenges with resilience. This we reflectedthrough our strong operational performance. Our revenues stood at 66 997. 01 Lacs andEBIT at 50 86. 55 Lacs in the fiscal. Profit BeforeTax and Profit after Tax stood at Rs4 382. 40 Lacs and Rs 4 158. 30 Lacs respectively. We went a step ahead to achievefurther operational efficiencies and enrich our product mix. We are focussing on growingour domestic sales and aggressively expanding our sales network and achieve higher brandedsales.
It has been a year ofgreat transition for the Company. I am confident that we will havea more promising year ahead of us in view of the strategies we have undertaken thegradually developing positivity in our core operative sectors. I seek the support andcooperation of all our stakeholders to strengthen your company's mandate to help create aprogressiveand prosperous business.
The Company's management will continue to focus on operational commercial excellence inits operations and strive for further growth.
Finally I would like to gratefully acknowledge the trust and eonfidence reposed in usby you.
C. P. Agrawal