It is my privilege to present before you the 26th Annual Report of yourCompany. The Company has completed twenty-six successful years. As the new Chairperson andManaging Director of Swiss Glascoat Equipments Limited I take this opportunity to sharemy thoughts and vision about the shaping the future at Swiss Glascoat.
You are aware that the new promoters have taken over the control of the Company during2016-17. The new Management comprises of technically capable individuals and brings anaggregate engineering and management experience of over 75 years for utilising at SwissGlascoat. I am confident that the new management possesses the capability and acumenrequired to take the Company to newer heights in the coming years.
On 25th October 2016 Swiss Glascoat the selling promoters and theAcquirers comprising of HLE Engineers Private Limited along with Mr. Himanshu Patel Mr.Nilesh Patel Mr. Harsh Patel and Mr. Aalap Patel entered into a Share Purchase and ShareSubscription Agreement (SPSA) for:
(a) transfer of the equity shares of the Company held by the outgoing promoters infavour of the Acquirers; and
(b) issue and allotment of 1500000 Warrants convertible into equal number of EquityShares of the Company to HLE Engineers Private Limited which triggered the Open Offerunder the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 2011. TheOpen Offer process was duly completed in March 2017. Further as per the terms of issueof Warrants on exercise of the option to convert the Warrants into an equal number ofEquity Shares the Company allotted 1500000 Equity Shares to HLE Engineers PrivateLimited on 31st March 2017. Presently the new Promoters hold 50.25% stake ofthe Company.
The one characteristic that has defined the economy over the last year is"uncertainty". Uncertainty has brought along its own share of challenges andopportunities for the industry. The year 2016-17 had its share of uncertainty whichaffected the performance of the Company.
The key event that left its mark on each and every sector of the domestic economy was"demonetisation". Coming at a time when the economy was just beginning to lookup the Government's decision to demonetise currency notes of Rs. 500 and Rs. 1000 whichaccounted for 86% of the currency in circulation caused severe cash/ liquidity crunch inthe domestic economy for several months leading to an adverse impact on the consumptiondemand and business activity during the second half of the financial year.
Stressed loans continue to plague the banking sector and the stretched corporatebalance sheets continued to be a hurdle for new capital investments which have remainedmuch below the trends over the past few years. The gradually falling inflation and anaccommodative monetary policy though provided support in an otherwise difficult growthenvironment.
The overall economy is now seeing strong signs of recovery as Reserve Bank of India hasbeen able to control inflation and has also initiated interest rates reduction. Theindustry is expecting further reduction in interest rates as a measure to propel economicgrowth. It is anticipated that the engineering and capital goods sector will soonexperience the impetus from reformative measures being taken by the Government.
The new financial year has started on an encouraging note with active steps by theGovernment to implement the Goods and Services Tax (GST) from 1st July 2017.GST is the single biggest indirect tax reform and is poised to push India's economicgrowth forward by creating a single national market and enhancing the efficiency ofinter-state movement of goods and services. However given the enormity of the coverageand scale of implementation it is likely to cause some disruptions in the initial periodand the Company will have to overcome this short term hurdle as it adapts to the new GSTregime.
During the year 2016-17 your Company achieved a sales turnover of Rs. 81.47 crores(previous year Rs. 92.42 crores) and earned a profit after tax of Rs. 3.06 crores(previous year Rs. 4.15 crores). The Management is confident that during the currentfinancial year 2017-18 the Company will register better operational and financialperformance. This confidence is based on certain inherent strengths like strong brandrecognition encouraging order book strong financial position and the new management'srenewed focus on growth and operational efficiency.
I would also take this opportunity to place on record my sincere thanks and gratitudeto Mr. Sudarshan Amin who guided and spearheaded the Company's operations over the last26 years and built Swiss Glascoat to its current position of strength. I would also liketo place on record my gratitude to all our valued stakeholders for the trust andconfidence reposed in the Company and look forward to their continued support in thisjourney. I also sincerely appreciate each member of the Swiss Glascoat team and recognizethe contributions made by each and every one of our employees.
Mr. Himanshu Patel
Chairperson and Managing Director