My Fellow Shareholders
I am pleased to present the 25lh Annual Report of Genus PowerInfrastructures Limited reflecting on our accomplishments during the financial year (FY)2016-17 and to share our thoughts on the journey ahead. Our Company performed well duringthe FY 2016-17. However there were several challenges along the way. There was drop inboth revenue and profitability which was mainly attributed to lower tender off-take fromthe state power utilities and lower execution of ECC projects due to delays in processesand approvals atthe customers-end.
The FY 2016-17 was more of an aberration led by disagreement between the state andcentral government on the procurement policy of metering instrument. This resulted inslower off-take of tenders during the year. However with resolution of the procurementissue towards the end of FY 2016-17 the company has witnessed a positive businessscenario under the energy metering business which has gained momentum with an improvedpace of tendering. We remained successful to close the year with strong consolidated orderbookat Rs.685 crores against Rs.386crores on March 312016.
In line with our dividend policy and with a view to secure current income of investorsthe board has recommended a final dividend of Re.0.35 per share of face value (FV) of Re.lper share. The company hasalready paid an interim dividend of Re.0.10 per equity share forFY 2016-17 which was declared on January 312017. Thus the total dividend for FY 2016-17will be Re.
0.45 per share on FV of Re.l (45%).
I believe a supporting smart infrastructure is mandatory to ensure adequate reliableand enduring power supply. The integration of renewable rooftop solar decentralisedgeneration smart cities energy outages and electric vehicles are making it necessaryand mandatory to move towards a smart grid and smart grid cannot be a reality withouthaving an advance metering infrastructure (which includes smart energy meter) in place. Itisclearly visible that sincere attempts are being made by the present government toresolve the issues of power transmission and distribution sector and to achieve rapideconomic growth through various programs and policies such as UDAY Scheme IntegratedPower Development Scheme Deen Dayal UpadhyayaGramJyoti Yojana Make in India DigitalIndia National Smart Grid Mission Smart Cities Housing for All Power for All SolarNet Metering and higher budgetary allocations. These all will be the key demand drivers ofmetering solutions in India in the coming years. Besides these rapid urbanization andreplacement of conventional meters with smart meters will further strengthen thedemand ofsmart metering solutions.
Over the years Genus has been leading the way in advance metering infrastructure withexpertise in smart energy metering metering communications including control &automation software smart prepayment meters and net metering solutions in India. Withthe installation base of more than 42 million energy meters across the globe Genus isempanelled with more than 40 different power utilities/Discoms. With the mostcomprehensive range of smart metering solutions coupled with its 'engineeringconstruction & contracts' ('ECC') turnkey solutions Genus is uniquely catering tosmart grid and is addressing the issues of power utilities/Discoms especially for reducingAT&C losses and scaling technological excellence. I expect rapid growth in the topline in the coming years backed by the traction of orders from state powerutilities/Discoms powered by the ongoing schemes of government mainly with UDAY scheme.
Our endeavours to expand Genus's footprints in international territories have resultedin securing prestigious overseas orders from developing international markets. With morepenetration toward smart grid worldwide the global smart metering market is offering hugeopportunities for Smart Meters Prepayment Meters and Net Metering Solutions. It isexpected that the majority of the demands for Genus will come from Middle-East Africa andASEAN region. With substantial investments in smart grid technology the global meteringmarket is expected to continue to grow throughout the decade. In line with our strategy togain foothold in overseas markets we continue to establish our representative offices infastest growing regions in the world. Based on our credibility and proven competence inthe smart metering technology Genus is poised to be entrusted with more premiumassignments from overseas markets and is aiming for global leadership in the smartmetering business.
Genus continues to follow a distinct approach in its 'engineering construction andcontract' (ECC) project business. It remains focused on selective participation in ECCprojects business that could contribute to higher profitability of the company. Withutilities moving towards smart grid and government increasing focus on ruralelectrification & feeder separation Genus is looking for the better businessopportunities in these areas in thecomingyears.
When the industry is shifting doing more of the same is not the solution. In such achanging environment our inhouse research & development centre (recognized by theMinistry of Science & Technology Government of India and accredited by NationalAccreditation Body for Testing Labs ('NABL')) and state-of-the-art manufacturingfacilities with complete forward & backward integration give us an edge in theindustry. It makes us the most adjustable and distinguished player for offering fast andcustomised solutions at a competitive rate to a highly dynamic industry. Among others ourindigenous capability of research & development has been proving a growth engine ofthe company since inception. With our continued focus on innovation we spent around 22percent of our profit on R&D during the FY 2016-17.
I strongly believe that the cordial relationship between the management and employeescan take the organisation to a newer height. I sincerely thank the board members and allemployees for believing in organisation's goals and objectives and for creating such apositive and productive workplace by establishing respectful and amicable relationships. Ialways had faith on our employees in doing productive work that eventually benefited thecompany. I take pride to represent them and work together with them to ensure highergrowth for the company in the coming years.
In conclusion I would like to take this opportunity to thank all the stakeholders fortheir continued support and for inspiring us even in the turbulent time in the recentpast. I am committed to reinforce the company in path of rapid growth and to deliverhigher returns to our valued shareholders.
ISHWAR AND AGARWAL
Jaipur August 11 2017