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Greenply Industries Ltd.

BSE: 526797 Sector: Others
NSE: GREENPLY ISIN Code: INE461C01038
BSE LIVE 15:40 | 18 Oct 277.55 3.05
(1.11%)
OPEN

273.05

HIGH

279.95

LOW

272.00

NSE 15:45 | 18 Oct 276.40 0.55
(0.20%)
OPEN

275.80

HIGH

280.90

LOW

270.90

OPEN 273.05
PREVIOUS CLOSE 274.50
VOLUME 2239
52-Week high 309.00
52-Week low 236.50
P/E 25.87
Mkt Cap.(Rs cr) 3,403
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 273.05
CLOSE 274.50
VOLUME 2239
52-Week high 309.00
52-Week low 236.50
P/E 25.87
Mkt Cap.(Rs cr) 3,403
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Greenply Industries Ltd. (GREENPLY) - Chairman Speech

Company chairman speech

DEAR FRIENDS

Our experience and expertise powered by the support and guidance of all ourstakeholders have enabled us to reach the stature that we have attained today. While overtwenty-five years of experience in the interior infrastructure industry have enriched ourmarket insight and sharpened our capabilities a lot more needs to be achieved goingforward. I believe it is an opportunity for us to be operating at a time when theeconomic and business landscape of India is radically changing; and policymakers arecreating enablers for strong and sustainable growth. India is evolving fast. In itsseventh decade of Independence over US$1 trillion has been added to the national GDPlifting tens of millions to the middle class. Our objective is to make the most of thisopportunity with speed and precision using our brand respect and recall.

Against the backdrop of either sluggish or fragile economic growth across large partsof the world India shines as an outpost of opportunity and a harbour of hope. Thecountry's GDP for FY 2016-17 touched 7.1% and is expected to touch 8% with theimplementation of GST. Another seminal reform during the year was the demonetisationinitiative of the government. This was done with the avowed purpose of formalisation anddigitisation of the economy.

As India turns digital we must also enhance our digital presence going forward. Wewill be able to reach more markets and customers through digital channels. Following theimplementation of GST and more focus on formalisation of the economy established brandslike Greenply will get a level playing field vis--vis unorganised players.

GOODS AND SERVICES TAX (GST)

If we look at the plywood industry now it is heavily taxed with overall taxes in therange of 25-30% including taxes such as excise VAT and Octroi. Most unorganised playersevade taxes and sell their products through under-pricing vis--vis organisedcounterparts. The price differential can range up to 30-50%.

Many unorganised players also avail of the Small Scale Industry (SSI) benefit bykeeping their turnover artificially below the prescribed limit. Under the new GST regimethe exemption limit is expected to be Rs 2 million which would bring all unorganisedplayers within the tax ambit forcing them to increase prices and narrow the pricedifferential.

Moreover currently there is no credit that a dealer can avail of for the excise dutypaid but under GST this will be allowed reducing the price for both dealers andconsumers by around 10%. Thus the overall price differential between branded andunbranded plywood players is expected to fall by 10-20% under GST thereby acceleratingthe shift from the unorganised to the organised segment.

ANTI_DUMPING DUTY

During 2016-17 the Government imposed anti-dumping duty of up to US$ 64.35/cbm on theimport of MDF board on thick boards (with thickness of over 6 mm) from Vietnam andIndonesia. Today around 70% of our capacity is based on the thick MDF board. Thegovernment decision will create a level playing field for us vis--vis foreign producers.Going forward we hope to enhance our volumes further.

GROWING RELEVANCE OF MDF

MDF is the preferred choice of ready-made furniture manufacturers and the transition ofthe Indian wood furniture industry towards ready-made furniture will propel MDF's demand.Commercial property is another key demand driver as around 80% of MDF is used in thissegment. The shift from cheap plywood to MDF will gain momentum once low-end/cheap plywoodbecomes costlier following the implementation of GST.

INVESTING IN THE FUTURE

We remain bullish on our core businesses. Hence we are constantly focusing on growingour capacities across both our businesses. We are setting up our new state-of-the-art MDFplant in Chittoor Andhra Pradesh. We are likely to commence operations in FY 2019. Asignificant part of the production from this plant will cater to export markets.

We also planning to set up a Decorative Veneer/ Decorative Plywood unit in BamanboreGujarat (2.25 mn. sq. mts.) and a Plywood unit in Sandila Uttar Pradesh (13.5 mn. sq.mts.).

QUALIFIED INSTITUTIONAL PLACEMENT (QIP)

During 2016-17 we raised Rs 49.99 crore through issuance of equity shares underQualified institutional placement (QIP). The amount raised has been utilised for partfunding of our new MDF unit in Andhra Pradesh.

ACHIEVERS AT GREENPLY

Greenply is geared for greater success and our teams are inspired to build a brand thatNew India can rely on. We will continue to invest in enhancing the skills of our peopleso that we can continue to deliver products that are in line with international standards.We offer various employee engagement and coaching programmes to inform and motivate ourpeople.

As responsible corporate citizens we promote various community well-being programmesthrough the Greenply Foundation. The Foundation works in the realms of healthcareeducation vocational skill development among others.

We are committed to build a great company which consistently grows in step withaspirational India and I seek the support of all our stakeholders in this endeavour.

Warm regards

S. P. MITTAL

Executive Chairman (DIN: 00237242)