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Saboo Brothers Ltd.

BSE: 530267 Sector: Engineering
NSE: N.A. ISIN Code: INE021N01011
BSE LIVE 15:17 | 09 Aug 13.18 0.43
(3.37%)
OPEN

13.00

HIGH

13.18

LOW

12.15

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 13.00
PREVIOUS CLOSE 12.75
VOLUME 1562
52-Week high 13.18
52-Week low 10.45
P/E 69.37
Mkt Cap.(Rs cr) 8
Buy Price 13.18
Buy Qty 183.00
Sell Price 0.00
Sell Qty 0.00
OPEN 13.00
CLOSE 12.75
VOLUME 1562
52-Week high 13.18
52-Week low 10.45
P/E 69.37
Mkt Cap.(Rs cr) 8
Buy Price 13.18
Buy Qty 183.00
Sell Price 0.00
Sell Qty 0.00

Saboo Brothers Ltd. (SABOOBROTHERS) - Chairman Speech

Company chairman speech

1996 SABOO BROTHERS LIMITED CHAIRMAN'S STATEMENT It gives me great pleasure to extend a warm welcome to all of you to this Seventeenth Annual General Meeting of your Company. With your permission, I will take the report of the Board of Directors and the attached accounts for the fifteen months period ended 30th June, 1996 as read, as the same were with you for the past some time. MACRO ECONOMIC OVERVIEW OF THE COUNTRY DURING 1995-96 It is appreciable to note that inspite of slow agricultural growth, the Indian economy maintained its momentum of acceleration in GDP by registering an impressive growth of around 7 during the fiscal year 1995-96 as compared to around 5.3 during the last year. There were lots of ups and downs during this period and the political situation of our Country also remained uncertain. There was a change of Government in May 1996 when the Country witnessed tumultuous events as the Congress reign was taken over by multi-party alliance, United Front Government" at the Centre. The new Government has expressed deep concern and commitment to continue the reform process and have reiterated the need to cut fiscal deficit, raise revenues and to restructure the infrastructure sector. The Government's initiative in encouraging foreign direct investment by streamlining the procedures of Foreign Investment Promotion Board and also the relaxed guidelines for issue of Global Deposit Receipts and external commercial borrowings should result in increased inflow of funds from abroad. The confidence of the general public and the Securities market fraternity has also shaken over the past one year which has not only resulted in total depression in the capital market but has resulted in liquidity crunch and has affected every corner, sector and industry of our Country. This has forced RBI to introduce new regulations from time to time or controlling money market and bank credit which has led to banks lending at interest rates in the range of 17 to 20 despite a drop in inflation below 5. As such steps are regularly being taken by the UF Government to improve the situation but the general confidence and sentiment is still required to be lifted. I am strongly of the view that if sincere efforts are put in to implement the policies and plans of the new Government, there will certainly be a path to success towards achievement of targets set for the fiscal year 1996-97. CIMENT INDUSTRY PERFORMANCE AND PROSPECTS The Cement Industry witnessed another good period during fiscal year 1995- 96 when the production of cement touched new height of 69 million tonnes as against 62.4 million tonnes in the previous year representing a growth of 10. The task force for the Cement Industry set up by the Government of India has in its report indicated that the demand pattern in Ninth plan period is expected to grow at the rate of 8 to 9 percent annually to reach 109 million tonnes by 200-2002 and to 160 million tonnes in 2006-2007 which confirms tremendous potential for growth in the years to come. Here I wish to acknowledge the fact that the current market of the industry has depressed over past few months but I am confident this situation will not last for a long time as this is due to overall bad liquidity position of the Country as a whole. ASSESSMENT OF COMPANY'S The performance of the company has been improved as compared to previous year. As the current year was extended by three months period which ended on 30th June, 1996 hence the current financial year consists of fifteen months period as compared to twelve months period of previous year. The two periods comparison shows proportionate increase and tremendous improvement in sales and profits. The gross sales has improved from 535.91 Lakh to Rs. 1246.04 Lakh and the profit before taxation after providing for depreciation has improved from Rs. 71.14 Lakh to Rs. 183.42 Lakh. The net profit has also jumped up from Rs. 47.14 Lakh to Rs. 139.42 Lakh during this period. Inspite of this no dividend has been recommended by the directors of the company with a view to plough back the profits to meet the present challenges and further improve the financial position by mobilising the funds towards achieving the company's objectives. The success of your Company is also marked by the fact that there has been substantial improvement in cement production by 10 and increase in demand which has encouraged private entrepreneurs for further investment in cement plants. Your company alongwith its Group concerns is also considering to take up projects for setting up cement plants of higher capacity upto 600 TPD. For this it has entered into an agreement with a concern based at Gujarat for construction of buildings and heavy foundations for installing a plant upto the aforesaid capacity. The successful installation of plant will open new avenues for your company and its success. STATUS OF NEW PROJECT I feel indeed regret to express that the implementation of new project at Village Tanawara on Salawas road, District Jodhpur has delayed mainly due to delay in conversion of land for industrial use by the State Government of Rajasthan. However it is heartening to note that immediately after getting the permission in July, 1996 the company has boosted its efforts to construct factory buildings in full swing which is expected to be completed by next March, 1997. 70% construction work is almost over and the remaining sections are expected to be erected before the expiry of the expected time. Further the machinery is ready for installation and for delivery at site, which will not cause any further delay of the new project. PROSPECTS OF NEW PROJECT AND FUTURE OUTLOOK The commencement of new project will enhance its existing production of refractory cement which will be mainly consumed about 70% in integrated steel plants, nearly 15 in Thermal power plants and rest 15 among large Cement plants, Sugar industries, Petro-Chemical and fertilizer industries. As far as its export potential is concerned it is being demanded in Middle East countries & also Pakistan, Sri Lanka Bangladesh, etc., and we being nearer to these countries expect to receive good response on commencement of production. The company is also regularly supplying its refractory products to prestigious Organisations like Bhillai Steel Plant, Bokaro Steel Plant Bharat Refractories Ltd., etc., and has also started exporting of refractory cement to Egypt & Greece. At the new site, the plans are also underway to manufacture Calcined lime and Hydrated lime with purity in the range of 93-95 percent which is rarely available in India and especially Northern India. The main users of the output will be the industries engaged in the production of lubricants, paper, fertilizers, chemicals etc. I am also pleased to inform you that the company has recently procured export orders for four Mini Cement Plants of 150 TPD capacity which ensures the continued efforts of the company towards determined future growth. You will also be pleased to note that the company has decided to manufacture Brown Fused Alumina of which the current demand is hovering around Rs. 50 Crore in India. There are only few manufacturers of this product in India and thus company does not foresee any problem in marketing the product. The company is also carrying on research and development activities for the production of White Fused Alumina and we hope to commence its commercial production as well as marketing in near future and expect to receive good response. Besides the Company is also planning to produce import substitute low silica (Silica below 2.5) Dead Burnt Magnesite and I feel pleasure in claiming that your company will be first in Northern India to produce this rare quality of Magnesite which is being used in bulk by all the major steel plants, at present this is being imported by them. ACKNOWLEDGEMENT With a promise for a bright future, I thank you for your support and co- operation and would also like to take this opportunity to acknowledge the continuous co-operation and support extended to the company by its customers, suppliers, Financial Institution, Banks and other Government Authorities. I also place on record my appreciation for the good work done by workers and members of staff at all levels and for maintaining cordial industrial relations during the year. (DURGA PRASAD SABOO)