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Tamil Nadu Newsprint & Papers Ltd.

BSE: 531426 Sector: Industrials
NSE: TNPL ISIN Code: INE107A01015
BSE LIVE 15:40 | 15 Dec 436.55 4.85
(1.12%)
OPEN

435.00

HIGH

440.20

LOW

431.00

NSE 15:54 | 15 Dec 437.55 6.15
(1.43%)
OPEN

439.85

HIGH

441.90

LOW

430.85

OPEN 435.00
PREVIOUS CLOSE 431.70
VOLUME 38575
52-Week high 450.90
52-Week low 289.15
P/E 136.42
Mkt Cap.(Rs cr) 3,021
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 435.00
CLOSE 431.70
VOLUME 38575
52-Week high 450.90
52-Week low 289.15
P/E 136.42
Mkt Cap.(Rs cr) 3,021
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Tamil Nadu Newsprint & Papers Ltd. (TNPL) - Chairman Speech

Company chairman speech

TAMIL NADU NEWSPRINT AND PAPERS LIMITED ANNUAL REPORT 2003-2004 CHAIRMAN'S REPORT SPEECH BY THIRU RAMESHRAM MISHRA, I.A.S., CHAIRMAN AND MANAGING DIRECTOR (I/C) AT THE TWENTY FOURTH ANNUAL GENERAL MEETING OF SHARE HOLDERS OF THE COMPANY ON FRIDAY, THE 20TH AUGUST 2004 AT 10.00 AM AT MUSIC ACADEMY, 168, T.T.K. ROAD, CHENNAI - 600 014. LADIES AND GENTLEMEN, I have great pleasure in welcoming you all to this, the 24th Annual General Meeting of the company. The Directors' report and the Audited Accounts for the year ended 31st March 2004 have been with you for sometime and with your permission, I shall take them as read. PERFORMANCE REVIEW I am happy to inform you that during the year under review your company has produced 1,70,634 MT of Printing and Writing paper and 11,581 MT of Newsprint. The production was up by 14,337 MT compared to the previous year. During the year, your Company had faced many hurdles right from stoppage of production for 37 machine days due to water shortage, the steep hike in coal prices, since December 2003. Despite these major shortcomings, your company has posted a healthy Pre Tax profit of Rs.68.58 crores after providing Rs.60.15 crores for Depreciation, Rs. 16.25 crores for Interest and Financial charges and Rs.3.31 crores for Prior Period from 12:88 in 2002-2003 to 6:94 in 20032004 has enabled your company to contain the adverse effects to a certain extent. Your company has been increasing the inhouse hard wood pulp production every year for the past five years. The hardwood pulp production during the year was 35,852 MT against 33,533 MT in 2002-2003 and 28,937 MT in 2001- 2002. During the year, your company has augmented the windfarm capacity from 18 MW to 21.75 MW and exported 2.83 crore units of wind power and 9.81 crore units of surplus captive power to the State Grid. The restructuring of the debt profile by swapping the multi-currency loan of USD 45 million availed from the World Bank with FCNR(B) Loan availed from a consortium of banks led by State Bank of India during December 2002, has enabled your company to overcome the adverse effect of USD weakening against Yen and Euro during the year. But for the timely swapping of the multicurrency loan, the loan liability at the end of the year would have been higher by USD million equivalent to Rs.23.57 crores. Further, the swapping has facilitated your company to reduce the interest burden during the year by USD 2.75 Million equivalent to Rs.11.90 crores. Your company has reduced the water consumption from 105 KL per MT of paper production in 2002-2003 to 83 KL per MT in 2003-2004. The Bio-Methanation Plant commissioned during the year has generated 41.45 lakh cubic meter methane gas. The bio gas was used as a fuel in the limekiln replacing the usage of 2165 kilo litres of furnace oil, saving Rs.2.48 crores. The profit during the first quarter of the current year was lower compared to the previous year due to cost escalation. The adverse impact on account of the increase in coal price reflected in steam, power and bagasse cost and the shortfall in bagasse during the first quarter of the current year compared to the previous year due to drought in the Cauvery river fed areas could have been managed with higher production. However, the production during the first quarter of the current year was also low at 36,955 MT on account of shut down of paper machines for 57 machine days due to water shortage during April - May 2004 and consequent loss of production of 18,530 MT The water supply has improved since July 2004. Consequently, the production during current and subsequent quarters will be higher. CURRENT STATUS OF PAPER INDUSTRY After a period of two years, the imported newsprint price improved from USD 420 per MT at the beginning of the year to USD 510 per MT at the end of the year. The price has further improved to USD 540 per MT for April-June 2004 quarter and to USD 570 per MT for July-September 2004 quarter. Even with the above price increases and levying of customs duty on imported newsprint at the lowest slab of 5%, the domestic newsprint production is not economical. Your company has therefore reduced the newsprint production further during the. current year. The demand for Printing and Writing Paper during the year in the domestic market was stable. The market absorbed the price increase of Rs.1000/- per MT effected from 1.4.2004. The prices of Printing and Writing paper in the international market softened from July 2003 till February 2004 and started firming up again from larch 2004. The Government of India has reduced the DEPB benefit for Newsprint and Printing and Writing paper export from 8%a to 4% from 9.02.2004. This has affected the export realisation to a certain extent. During the year, your company has exported 30,098 MT of Printing and Writing Paper. CAPEXIL, an organisation sponsored by the Ministry of Commerce, Government of India has bestowed on your company the best exporter award for the fifth consecutive year. With the uptrend in the export prices for printing and writing paper, your company is confident of increasing the exports to around 36,000 MT during 2004-2005. FUTURE OUTLOOK Per capita consumption of paper in India at 5.6 kgs is far below the global average of 60 kgs and Asian average of 45 kgs. An average growth rate of 6% in demand for the next 5 years is anticipated. The current year is expected to be a better year for the global paper industry in terms of demand and price. In line with the general trend, your company has increased the export prices since March 2004 and domestic price by Rs.500/- per MT with effect from May 2004. A price increase of Rs.600/- per MT is contemplated from 1.9.2004. The market for surface sized papers and copier papers are expected to grow by 10-15%. Your company has increased the copier production from 15,262 MT in 20022003 to 19,311 MT in 2003-2004 and set the target of 30,000 MT for 2004-2005. The newsprint price in the global market is expected to reach USD 600 per MT by the end of the current year. FUTURE PLAN M/s. AMEC, Canada, who were engaged as consultants for preparing the Detailed Project Report (DPR) and Detailed Market Survey (DMS) for the expansion plan have submitted the report. After taking into account the feasibility and economics of various alternative your companys has drawn up a development plan which focuses on modernisation and expansion of the pulp mill with facilities that are environmentally compliant, operationally efficient and cost effective, minimal water consumption, selfsufficiency in energy besides enhancing the paper production capacity by 15,000 MT per annum. Your company has proposed to increase the wind farm capacity by 6 MW during the current year. During the year, your company has planted pulpwood seedling in 204 acres of wasteland allotted by the Government of Tamil Nadu. The planting in another 552 acres of wasteland will be undertaken during the current year. In addition, your company proposes to implement a farm forestry scheme in 2,500 acres of uncultivated farm lands by supplying seedling / clones at the subsidised rates, arranging loan assistance from banks and assurance to lift the pulpwood at the price prevailing at the time of harvest with minimum guaranteed price fixed upfront. ENVIRONMENT PROTECTION Your company is totally committed to care for the Environment, uphold Human Safety and Health. Your company has evolved policies on Environment, Energy, Safety and Quality. Effluents from the plant totally conform to the standards of the Tamil Nadu Pollution Control Board. The recommendations of Justice K.A Swami Committee for improving the effluent system has been implemented. Your company has taken various steps to comply with all relevant legislative requirements, by reducing the pollution load in terms of liquid discharge, air emission and land conservation and by saving energy and preserving natural resources. Installation of the Bio-methanation Plant for generation of methane gas from bagasse wash water and use it as a substitute for furnace oil in the lime ,kiln is a step in the right direction on environment care. Pith and the Bio-sludge generated from the effluent treatment plant are judiciously used as fuel in power boilers. Around 39,974 MT of Pith and 68,133 MT of Bio-sludge were used as fuel in power boilers during the year. SOCIAL DEVELOPMENT Your company has taken several steps for promoting the overall development of its neighbourhood. The treated effluent water which conforms to the standards prescribed by TNPCB is utilised for irrigating around 1,500 acres of land adjacent to the factory. Your company has identified itself with the local community by taking part in water supply schemes, road developments, organising medical camps etc.. Your company has contributed liberally to the social events, cultural programmes and sports activities in the neighbourhood. ACKNOWLEDGEMENT I take this opportunity to place on record my sincere thanks to the Central and State Governments, IDBI and the Banks for their valuable support and assistance. I also thank my colleagues on the Board for their valuable advice and support. I take this opportunity to place on record my sincere appreciation for the efforts put in by all the officers, staff and workers of the company. I also wish to thank all the shareholders and other investors for their continued support. I thank you all for having attended this Annual General Meeting, sparing your precious time. Source : 24th AGM Date : 20th August, 2004