It has been a stupendous year under review for your Company and it gives me pleasure towrite you again. While the financial numbers were historic and reached record levels ouroperations and strategies formed the bedrock of growth. This was achieved at the backdropof volatile economic scenario both at global and national levels. Even as demonetisationpulled the economic growth back at 7.1% for FY 17 our country continues to outpace growthof major developed economies. On a global scale the commodity prices remained volatileas several macro-economic and geo-political factors continued to overshadow overall globaleconomic growth.
Amidst these circumstances your Company outperformed industry growth and has created aplatform for sustainable growth. We took several initiatives that helped us scale aheadOne we actively increased our price control mechanism mitigating price volatility risks.In the last two years the metal prices had gone down which led to fall in our margins aswe were unable to pass the fluctuations to our customers. As a strategic step we enhancedour internal team and consciously made efforts towards locking in prices at London MetalExchange (LME).
Two we gave incentives to our team for operational improvements. The incentives weregiven to ensure we see tangible results for increase in volumes and procurement levels ina cost-effective manner. The result: volumes increased by 63% in all the plants andcapacity utilisation increased by 10%. We also saw a significant improvement in thecollection ratio improving our margins. The Company's profitability increased from Rs.4.5crore to Rs.30 crore registering our highest ever profitability.
Three we entered into new countries in terms of procurement and market expansion. Ourteam focused on grass root level for procurement reaching out to every possible level ofLead secondary sale thereby strengthening our position as market leaders.
Leveraging our recycling experience we diversified into aluminium recycling in April2016 and performed reasonably well in first full year of operations. Similarly we alsopenetrated the PET recycle business. I would like to assure the stakeholders that as anorganisation we are leveraging our core competencies of more than two decades andexpanding into new businesses only to derive greater operational efficiencies and higherprofitability levels.
Coming back to our Lead recycle business we commenced commercial production of Leadmetal from our new recycling plant situated at Chittoor Andhra Pradesh. The plant has aproduction capacity of 12000 MTPA and will help us enhance domestic procurement in thesouthern region on one hand and make it easy for us to export the Lead Metal/Alloysthrough nearest Chennai Port to our major customers across South East Asian Region.
We are quite optimistic about the progress of our business as the global and Indianindustry for Lead and Aluminium are performing well. There has been a significant growthin the automobile industry by 12-13% which is advantageous for us as the automobilesector is one of the biggest growth driver of our business.
As I mentioned earlier we also started plastic recycling production by setting upplant through our step-down subsidiary Gravita Nicaragua SA in Nicaragua. The plant wasset-up with internal accruals of around USD 1 million. We have a two-stage model for PETrecycling: waste collection and flex formation; and we will continue to expand PETrecycling facilities in South America. We are expecting a revenue of H 100 crore in FY18with 12-15 percent profit margin. The current annual production capacity of this plant is3600 MTPA.
The engineering and Lead recycling Turnkey solution arm of your Company has bagged anorder worth Rs.150 million from the Middle East region in early 2017. As the oildriven-economy of Middle East continues to face challenges the Government now focuses ongiving thrust to manufacturing and recycling sector. Your Company a leading recycler ofLead has a niche offering in Lead recycling turnkey solutions have executed over 50turnkey projects in last few years. This move will help us further in penetrating marketsin the emerging countries.
As we march along the road towards growth globalisation and sustainability we remainrooted to our ethos and values. Our CSR initiatives extend well beyond our core businessobjectives and our commitment and concerns for the society are evident from the variousinitiatives it has taken in different fields in such short period of time. In our endeavorto create a green and sustainable environment we showed true spirit and ran a campaign"Mission Green" to plant 5000 trees engaging students women clients andcommunity at large and making a commitment to the community around it.
Going ahead we are expecting better growth in FY18. With implementation of GST weexpect the shift from the informal sector of Lead recycling to formal sector. With adiversified business model in place we expect to expand our revenues and profitabilitylevels and emerge as a recognised recycled business conglomerate with a vast global andnational network.
I also take this opportunity to thank the Board and the team for their continuedsupport and trust to drive the Company ahead.
DR. MAHAVIR PRASAD AGARWAL
Chairman & Whole-Time Director