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Jaiprakash Associates Ltd.

BSE: 532532 Sector: Infrastructure
NSE: JPASSOCIAT ISIN Code: INE455F01025
BSE LIVE 12:13 | 24 Nov 18.65 -0.05
(-0.27%)
OPEN

18.90

HIGH

19.05

LOW

18.55

NSE 11:59 | 24 Nov 18.70 -0.05
(-0.27%)
OPEN

18.85

HIGH

19.10

LOW

18.55

OPEN 18.90
PREVIOUS CLOSE 18.70
VOLUME 2046981
52-Week high 30.40
52-Week low 6.71
P/E
Mkt Cap.(Rs cr) 4,537
Buy Price 18.65
Buy Qty 32572.00
Sell Price 18.70
Sell Qty 32482.00
OPEN 18.90
CLOSE 18.70
VOLUME 2046981
52-Week high 30.40
52-Week low 6.71
P/E
Mkt Cap.(Rs cr) 4,537
Buy Price 18.65
Buy Qty 32572.00
Sell Price 18.70
Sell Qty 32482.00

Jaiprakash Associates Ltd. (JPASSOCIAT) - Chairman Speech

Company chairman speech

JAIPRAKASH ASSOCIATES LIMITED ANNUAL REPORT 2004-2005 CHAIRMAN'S REPORT Dear Members, It gives me great pleasure to welcome you all to the 8th Annual General Meeting of Jaiprakash Associates Ltd. The Company's accounts for the year ended March 31, 2005, along with the Directors' and Auditors' Report, a Letter to Shareholders and Management Discussion and Analysis, have already been circulated to you. With your permission, I would like to take them as read. I take this opportunity to place on record my deep sense of appreciation for the trust reposed by you all these years, which has been one of the important motivating factors, for us in successfully surmounting the challenges that we faced during the period of growth in recent times. The sustained performance of the Company based on its sound work culture has aroused confidence amongst all stakeholders including the global investor community. The present economic scenario and the continuing focus on the infrastructure sector provides us an enabling climate for future growth and sustained profitability of the company. The reform process initiated in early 90s, and taken forward by successive Governments, have demonstrated their impact, fuelling multi-dimensional growth across all sectors and have touched lives of majority of Indians. Our beloved country, endowed with all natural resources in ample measure, offers a great opportunity to one billion Indians to transform India from a 'Developing Nation' to a 'Developed Nation'. With impetus on infrastructural development of the country, greater involvement of private sector, and changing mind set for accomplishing tasks of national importance in a time bound manner, be it participation of private sector in power development, operationalisation of DMRC in the National Capital or the great telecom story were unthinkable 15 years back and are changing things for the better. Participation In Nation Building: Your Company has been well entrenched In Infrastructure projects for over 40 years and the opportunities which came with the Government revisiting the lost focus on hydropower sector, necessitated by the rising cost of power generated from sources other than hydropower, have seen your company participating in 12 hydropower projects concurrently, which translates to participation in 54% of hydropower projects under execution in the Tenth Five Year Plan, in different capacities within India and Bhutan. With the impact of globalization being felt in every sector, Engineering and Construction Sector of the country has also not remained untouched from this necessary transformation. Your Company foresaw this challenge and equipped itself in time with the capability of undertaking construction of hydro power projects on Engineering, Procurement and Construction Basis (EPC). Today, Jaiprakash Associates Limited (JAL) has reservoir of talent and experience responsible for the design and engineering of hydro power projects irrespective of size and intricacies involved, a hydro-mechanical equipment manufacturing facility and has successfully demonstrated its EPC capability by bagging 3 out of 4 projects awarded on EP( basis in hydropower sector in the last 20 years (as on June 2005). Its contribution in hydropower development of the country and capabilities were recognized with ICRA rating JAL with 'CR-1' Grade, indicating very strong contract execution capacity in hydro power (EPC Contracts) in India with average values of upto Rs.2000 crore. The only company to be awarded with this rating for this value. I continue to firmly believe that mother nature, while blessing our country, has been particularly generous with the great natural resource 'WATER' which is and shall remain perhaps the single largest source that would ushera new era of prosperity for our nation in this century. Government of India's thrust for development of 50,000 MW of hydropower by 2017 would address the much needed stability for the power regime and is likely to restore hydrothermal mix to 40:60 as recommended by the Ministry of Power for power system of this size, while moderating the rising tariff for the consumer all across which in turn, is bound to have a soothening impact on inflationary trends of the economy. Your Company took the pioneering step of participating In development of 300 MW BASPA-11 Hydroelectric Project through its subsidiary Jaiprakash Hydro-Power Limited in 1992, which on commissioning in 2003, is India's largest hydropower station in Private Sector. For mystic reasons, JAYPEE GROUP has unflinching faith in future of hydropower which made us participate in development of 400 MW Vishnuprayag Hydroelectric Project through its subsidiary, Jaiprakash Power Ventures Ltd., which is expected to be operational in March 2006 and 1000MW Karcham- Wangtoo Hydroelectric Project scheduled for completion by 2010. Each of these projects Is a Run-of the River project devoid of concerns related to rehabilitation, resettlement and submergence. These initiatives would not have taken the present shape without your complete trust in the Company. With a total hydropower generating capacity of 17000 MW your company, JAL, shall be the largest entity In hydropower In Private Sector by 2010, BASPA-II Hydroelectric Project and Vishnuprayag Hydroelectric Project have long term PPAs, ensuring 100% off-take of power by the respective State Governments and Return on Equity as per Government of India's guidelines. I understand the maiden dividend payout from Jaiprakash Hydro-Power Ltd.(JHPL) immediately upon listing has reached all privileged shareholders of JAL who participated in the 'Offer For Sale' of JHPL, which was overwhelmingly subscribed to in March 2005. 'First mover advantage' available to your Group In hydropower sector have opened now opportunities which shall help In building now capacity for the nation and ensuring lasting prosperity for Its stakeholders, Your Company's footprint in Cement manufacturing today with a seven million tonne cement manufacturing facility at Rewa in Central India and a three million tonne new cement manufacturing facility coming up in Himachal Pradesh has catapulted your Company amongst the top five Cement Majors. The Company's cement production facility at Rewa is the largest single location cement manufacturing complex in the country and it is amongst the most cost effective cement producers with more than 65% power requirement being sourced from Company's own captive thermal power plants. With continued focus on enhancement of productivity and efficiency, the cost of power, which accounts for 33% of the production cost, will further come down with the commissioning of the 38 MW captive thermal power plant by March 2006, making the cement complex source 100% power requirement from its captive thermal power plants. With the cement consumption across the entire country registering a sustained CAGR of 8% in last 5 years, and your Company's cement facilities catering to India's fastest growing Northern Region, a bright future awaits for this stream of business. With the great strides made in conserving energy in every tonne of cement produced, and with enhancement in usage of environmentally challenging material, your Company is in the forefront amongst eligible producers who are likely to get Carbon Credit, in the near future. The company has taken lead in various environmental Initiatives that include afforestation in and around its cement complex with over 4 lakh trees, rainwater harvesting resulting in creation of manmade reservoirs to store 35 lakh cu.m of water as also using technologies in its thermal plants that conserve precious water, which have benefited the villages around the cement complex at REWA. Financial Review: Financial Performance constitutes the basis of an organisation's larger economic contribution. Your Company, with strong fundamentals, formidable presence in booming infrastructure sector of the country and strong focus in creating shareholder wealth in long term is aptly poised for sustained growth. The year saw JAL's turnover go up by 15.66% to Rs 2957 crore with PAT going up by 22.35% to Rs 207 crore. Post amalgamation of the erstwhile Jaiprakash Industries Ltd. into Jaypee Cement Limited has seen a 3 year compounded annual growth rate of PAT of 36% and EPS of 36%. During this period Total Shareholder Returns measured in terms of increase in market capitalization and dividend grew at a compound rate of well over 60% per annum. You will be pleased to know that the market capitalization of your Company crossed the USD 1 Billion mark in July 2005, for the first time. FAITH IS TO BELIEVE WHAT YOU DON'T YET SEE, REWARD OF FAITH IS TO SEE WHAT YOU BELIEVE: Our belief in country's great potential providing enormous opportunities to its countrymen today is more than it ever was. With an untapped potential of almost 130,000 MW of hydropower and with unmatched credentials to undertake any hydropower project in any terrain, your Company is best equipped to grow in this important sector, be it for package contracts, EPC contracts or as developer on Build, Own & Operate basis. Your Company is pursuing these challenges with renewed vigor to ensure its effective participation in development of this key sector in different regions of the country. Taking forward our footprint in power generation, we are also pursuing opportunities in the transmission sector and development of pit head thermal power plant to enable the Group play an important part in the energy sector as an integrated player in the current decade. People with resources must contribute towards making a better tomorrow for all. I firmly believe that quality education on an affordable basis is the biggest service which as a corporate citizen, we can provide. Education brings enlightenment, which in turn empowers people to pursue their dreams. Jaiprakash Sewa Sansthan, a not for profit Trust, supported by Jaypee Group has provided platform for various educational facilities, today imparting education in different streams to more than 14,000 students all over the country, across the entire spectrum of the education curve. We have pledged amongst us to continue our endeavor to make this initiative attain larger dimensions as we move forward. Acknowledgements: Before I conclude, let me reiterate that we have demonstrated and would continue to strive to enhance our: * Credibility with our clients * Credibility with the Financial Institutions / Banks, and * Credibility with all our stakeholders. Voyage thus far, would not have been possible without the support and encouragement by Central and State Governments, Bankers, Financial Institutions, Technocrats, Investors and all dear Shareholders. We continue to seek their patronage. I greatly value the collective efforts of entire JAYPEE Team and the contribution & involvement of my colleagues on the Board. JAI HIND Jaiprakash Gaur Chairman Note : Excerpts from the Chairman's speech at the 8th Annual General Meeting held on 27th September, 2005 in Lucknow. This does not purport to be a record of the proceedings of the Annual Genera/ Meeting. Regd. Office., 5 Park Road, Hazratganj, Lacknow - 226 001 website: www.jalindia.com Source : The Financial Express Dated : 29th September, 2005