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Garware Polyester Ltd.

BSE: 500655 Sector: Industrials
NSE: GARWARPOLY ISIN Code: INE291A01017
BSE LIVE 19:40 | 19 Oct 224.10 4.50
(2.05%)
OPEN

223.95

HIGH

227.00

LOW

218.30

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 223.95
PREVIOUS CLOSE 219.60
VOLUME 22168
52-Week high 227.00
52-Week low 112.00
P/E 25.01
Mkt Cap.(Rs cr) 523
Buy Price 0.00
Buy Qty 0.00
Sell Price 222.90
Sell Qty 25.00
OPEN 223.95
CLOSE 219.60
VOLUME 22168
52-Week high 227.00
52-Week low 112.00
P/E 25.01
Mkt Cap.(Rs cr) 523
Buy Price 0.00
Buy Qty 0.00
Sell Price 222.90
Sell Qty 25.00

Garware Polyester Ltd. (GARWARPOLY) - Chairman Speech

Company chairman speech

1994 GARWARE POLYESTER LIMITED CHAIRMAN'S STATEMENT I welcome you to the 37th Annual General Meeting of the company. I am sure by now you would have gone through the Annual Report for six months ending March `93-'94. Your company has come a long way since the days when we pioneered polyester film in India in `76. Since then we have developed innovative technology for various grades of polyester film and won the confidence of customers not only in India but all over the world. Today, we stand at the crossroads of the future. In the context of economic liberalisation, the challenges we envisage ahead include galloping demand for polyester film and increasing competition. With increased capacity and a focussed product approach, your company is poised to take on these challenges, and become a competitive global player in the polyester film industry. Gearing for the new business reality The process of liberalisation has had a cascading effect on virtually every facet of our operations. Delicensing has allowed us to plan a substantial increase in polyester film and polyester chips capacity. Devaluation and stabilisation of the Indian Rupee at its natural and market driven value has allowed us to target the large export markets, by encashing our cost advantages more effectively. Further, the substantial reduction in import duties of film could affect our realisation in domestic markets. However, if we maintain our cost competitiveness not only in the international market but also in the domestic market through large scale operations, high operating efficiency, an innovative approach of high performance grades specially formulated for each end use, we can actually maintain or even improve the profitability in India. The highlights of our manufacturing initiatives this year were investment in contemporary technologies, phased capacity expansion and maximising production through debottlenecking and modernisation. These moves will continue to make us more competitive at home and abroad. The rallying call for Garware Polyester is now globalisation. Reviewing performance As you are aware, the fiscal year changed in tandem with the new income tax year. The six-month period ending March 31, '94, saw the company achieve significant results. For the 6 months ending March '94, our total income reached a level of Rs. 153.98 crores - an increase of 15% over the previous year on an annualised basis. Our Profit Before Tax grew on an annualised basis by 51% to touch Rs. 10.6 crores. This led to an increase in Earning Per share from 12 to 19. As a result, we were able to step up our dividend from 20% for the 12 months ending Septemher '93 to 20% for the 6 months ending March '94. In the current year, in spite of having reached capacity constraints we were able to increase our sales to Rs. 84.53 crores in the first 5 months ending August '94, representing an increase of 18% over the same period of previous year. "The rallying call for Garware Polyester is now globalisation." On the production front, despite steep increases in raw material costs, the company's profitability was enhanced due to increased operational efficiency and introduction of new grades. Besides this, a number of new products have successfully been test marketed. These will be introduced after the capacity expansion. NEW INITIATIVES FOR THE FUTURE Capacity expansion The expanded film production capacity will become effective in the first quarter of '95. By the second quarter of '95 the 30,000 TPA Continuous Polymerisation facility will also become operational. Not only will this meet increased demand, but it will also increase availability of polyester chips for sale. With the proposed addition of the fourth film line in '96, the company will be able to further increase capacity and become a global player in polyester film. With a predicted turnover of over Rs. 500 crores. Your company will also join the few companies in the world to produce polyester film on Continuous Polymerisation basis, giving us the benefit of lower costs as compared to other polyester film producers. Financing expansion The total investment for the phase currently under completion is over Rs. 105 crores. The second phase which also includes backward integration, film and coating capacity, would cost over Rs. 100 crores. To finance this, the company plans a GDR issue, as well as a medium term forex loan. Needless to say, our capital cost for each tonne of capacity continues to be one of the lowest and this will improve our competitive edge in the next few years, even further. Previewing the future With capacity expected to double within the next few months and increase fourfold within two years, the company envisages no difficulty in selling the entire capacity in the domestic and export market. Restructuring the working capital by making full use of export credit and long term debts through a GDR issue and Euro Dollar financing will significantly impact interest cost and substantially improve earnings. Strategic alliances. New thrusts. Your company has recently entered into a marketing agreement with 3M which is one of the largest US corporations, with a diverse product range. Our association with 3M for Polyester based X-ray film will allow the company access to a large and profitable Medical Imaging segment which is one of the important end uses for polyester film. We expect that your company's association with 3M for the sale of X-ray film will open up a new market. "Your company will also join the few companies in the world to produce polyester film on Continuous Polymerisation basis... " Enhancing shareholder value As your company becomes glohal, we reiterate our commitment to enhancing shareholder value and EPS hy laying a greater emphasis on value added products, niche markets and renewed commitment to customer satisfaction. Shashikant B. Garware Chairman & Managing Director