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K C P Ltd.

BSE: 590066 Sector: Industrials
NSE: KCP ISIN Code: INE805C01028
BSE LIVE 15:40 | 16 Aug 102.30 0.65
(0.64%)
OPEN

102.90

HIGH

103.35

LOW

101.05

NSE 15:31 | 16 Aug 102.70 1.30
(1.28%)
OPEN

102.60

HIGH

103.30

LOW

100.75

OPEN 102.90
PREVIOUS CLOSE 101.65
VOLUME 9891
52-Week high 137.95
52-Week low 79.00
P/E 40.43
Mkt Cap.(Rs cr) 1,319
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 102.90
CLOSE 101.65
VOLUME 9891
52-Week high 137.95
52-Week low 79.00
P/E 40.43
Mkt Cap.(Rs cr) 1,319
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

K C P Ltd. (KCP) - Chairman Speech

Company chairman speech

Dear Shareholder

I am delighted to share with you an important landmark in the journey of your Companythe celebration of its platinum jubilee year with completion of 75 years of distinguishedexistence.

Today KCP is a group with turnover of about Rs 1400 crores with diverse initiativesinto Cement; Sugar; Heavy Engineering; Hospitality Generation of all types of power likeThermal Hydel Wind and Solar.

The vision of Late Sri Velagapudi Ramakrishna who laid the foundation for the Companyin 1941 is the inspiration for the path it covered with emphasis on quality ethicstransparency compliances and the corporate governance. KCP recognised the importance ofinclusive growth and the Social responsibility by starting a higher secondary school wayback in 1967 and carried on with such responsibility by setting up Polytechnic CollegeKids Patasala etc. and also took up activities for health infrastructure drinking waterso on and so forth.

With the technological foresight of its founder KCP envisioned ‘Excellencethrough Innovation’ and adopted the latest processes especially in criticalindustrial equipment.

The 75th Annual Report reveals that the fi nancial year(FY) 2016 was one of the bestyears of your company in recent times. Both on standalone basis as well as at grouplevel KCP registered good bottom line.

The performance of your Company is intertwined with the macro economic conditions ofthe country. India’s GDP gained momentum in the fi nal quarter of FY 2015 and pushedfull-year growth to a fi ve-year high. GDP grew 7.6% in FY 2015 which was up from 7.2% inthe previous fi scal year and primarily refl ected the robust growth in privateconsumption which accounts for nearly 60% of the economy. The budget defi cit has beenshrinking in last few years and is expected to narrow further. Stellar management of inflation which kept the Indian Rupee stable supported the government’s efforts toattract foreign-direct investment. India is reasonably insulated against global ramifications of ‘Brexit’ Brittan’s decision to exit European Union. Thestrengthening of other macroeconomic indicators including swelling foreign-exchangereserves and narrowing current-account defi cits also inspired confi dence in would-beinvestors. Reduction in interest rates was gradual due to the hawkish stance on infl ationtaken by the authorities.

As countries like China and Brazil have slipped in their economic management Indiasignaled that it is a mature economy where prudent macroeconomic decisions are takenbased on technical expertise not political whim. This raised its profi le in theinternational arena substantially.

Coming to the performance of the company I am particularly pleased to state thatcement segment of the company made giant contributions to the bottom line. Betterrealisations primarily helped in registering good profi ts in the cement segment. Thoughon pan India basis the demand for cement did not pick up as anticipated by the cementplayers your company could enhance the cement volumes also.

The power segment was a mixed bag during the year 2015-16. While captive thermal powerplant could optimise its capacity utilisation by selling the surplus power to the stategrids as well as other buyers through the exchange the hydel unit’s performance wasdismal due to the prevailing drought conditions.

The record rainfall in Chennai during the second half of the year affected theperformance of the Engineering Unit at Chennai. Coupled with the rains and fl oods thepickup of the demand for capital goods is still awaited. Consequently despite registeringhigher turnover the unit recorded losses.

I am delighted to share with you the fact that the Hotel project of your Company atHyderabad has been completed and is operational. Ours is a business hotel located in theheart of the capital city of Telangana Hyderabad. It has state of the art facilities.

I am happy to state that the phase-I expansion of your Company’s subsidiary sugarunit at Vietnam was completed and the results of the expansion would be refl ected in theyear 2016-17. Global prices of sugar have been improving since second half of the financial year 2015-16. The realisations in Vietnam also improved leading to enhanced financial performance of that unit. However the drought condition led to the poor cropresulting in reduction of volumes of sugar produced and sold.

Backed by the optimistic conditions in the economy the Union Budget 2016-17 proposed aslew of measures to boost infrastructure and investment which should be positive for thecement sector as increased spending on infrastructure enhances the demand for cement.Spends on smart city development allocations for Urban Rejuvenation Mission and Missionfor Development of 100 Smart Cities should also help cement off take. The rural pushgiven in the Budget should also spur the rural demand.Adoption of cement in the place ofbitumen in new road projects will also help in creating demand for cement.

The recent announcement that India will now for the fi rst time allow 100% foreignownership of fi rms in a broad swath of industries further reinforces the message thatIndia is open for business.

Buoyed by the policy measures taken by the government encouraging economic indicatorsand the developments in the Capital Region of Andhra Pradesh and other projects taken upin Telangana and Andhra Pradesh your Board of Directors’ have decided to expand thecapacity of the existing plant at Muktyala from 1.8 million tons per annum (TPA) to 3.5million TPA. The project is likely to go on stream by the fi nancial year 2019.

Your Company is committed to sustained development and inclusive growth of all thestakeholders and has a good Corporate Social Responsibility policy in place and iscommitted to diligent discharge of this responsibility.

Your Company banks on the confi dence reposed in it by all the stakeholders unstintedcommitment by its employees and customers.

I assure that your Company would strive to live up to your expectations.

Best Regards

V L Dutt

Chairman and Managing Director