R. P. Soni
The Indian growth story seems to be returning back on track. 2015-16 was a tough yearbut the consistent push from government for reforms coupled with conservative monetarypolicy and revival in the spends for infrastructure creation set the ball rolling again.The oil prices too have played a significant role and so did the well-communicatedgovernment's intent to revive the Indian consumption story through controlling inflationand taking non-populous policy level decisions.
Indian GDP in March 2016 is expected to have grown at 7.6% - which makes it world'sgrowing economy. The government's three key bills - GST Land Reforms & Bankruptcy Laware already being touted as game- changers. I am hopeful that the enthusiasm willtranslate into ground realities and will offer a boost in the arm for our entrepreneurs ascountry's demographic dividend. Further the year's monsoon is expected to be much betterthan the past two years' thereby expected to reinvigorate rural India's spending andconsumption. So to put all in perspective it is easy to say - we live in exciting times!
At Sangam we have always believed that while the times may be good or bad; there is nosubstitute to persistence. So we continued to persist by doing what we do best - LearningUnlearning and Relearning. We continued to look inward - identify bottlenecks focus onimproving our product quality think beyond established strategies to improve customerexperience and widening the product profile. Allow me to elaborate two such keyinitiatives taken during 2015-16.
One of the biggest initiatives we took during the year under review was to improvevisibility of our online venture - C9 Fashion. Previously named Channel Nine we rebrandedthe identity to C9 and at the same time consistently made improvements to accessplatforms - by extending from online to offline distribution too. We cautiously andjudiciously promoted C9 using high impact low cost channels - thereby using the existingdistribution synergies and presence to amplify the value proposition among the targetaudiences. We believe C9 is still at the very nascent stage and we will shape it into awell respected women active wear destination.
The second notable initiative taken by us in 2015-16 was initiation of our capacityexpansion program. The company is investing Rs. 198 crore in the capacity expansion forinstallation of 26736 Spindles at new site Soniyana Chittorgarh 74 Weaving Machines atexisting site Atun Bhilwara and One indigo Denim Fabric Processing Line at the existingsite Biliya Kalan Bhilwara. As on March 31 2016 we completed installation of 13296spindles 46 Nos. Weaving Machines and One Indigo Denim Fabric Processing Line. Theremaining installations under the expansion initiative would be completed by November2016.
Our denim vertical continues to perform well on account of wide range innovativefinishes and value for money product for men and women. The revenues from denim segmenttoday comprises of 21% largely owing to wide and deep distribution strategy for theproduct coupled with superior value for money to attract the customers. Similarly wecontinued to improve our suitings division too.
Besides strengthening our product portfolios we continued to focus on limiting thecontrollable costs thereby emerging as a high efficiency and affordable player in all oursegments of presence. At the same time to expand to quality conscious segments likeseamless garments thereby improving our realizations. The results also kind of reflectthis impact. In 2015-16 we registered a 2.4% increase in net revenues from Rs. 1468.66crore in 2014-15 to Rs. 1504.40 crore in 2015- 16. Despite the topline growth the companyreported a net profit of Rs. 77.04 crore - an increase of 49.4% against Rs. 51.57 crore in2014-15. The EBIDTA of the company also improved by 7.3% to Rs. 233.34 crore in 2015-16against Rs. 217.39 crore in 2014-15.
It took us 31 years to reach where we are today. The quest for perfection knows nofinality. We are much more informed experienced and resourceful today than we were 3decades ago. The nation is much more promising and driven to reach newer heights morethan ever. We are too ready... to transform our future. I would like to thank ourinvestors our employees and communities. I would like to thank our woman patrons formaking our brand C9 among the leading active wear brands in the country. We cherish yourcontinued support and I assure you we will let our clothes do the talking - like always.
R. P. Soni