The year gone by presented many challenges and we had to work hard to overcome these.We however remained firm and consistent in our business approach. The economic situationwas sluggish and there was no volume growth in the market.
We follow the best practices internally and that is the reason we could easily overcomethe challenges that demonetization presented. We did not face any setbacks and couldeasily overcome the situation despite a majority of our revenues comprising of smallbillings which was possible only because of our compliant organizational culture.Demonetization however affected the passenger traffic in the latter half of the last year.There is a lot of hue and cry over GST. Its implementation is imminent and I foresee thatimmediately upon such implementation there could be a considerable confusion and chaos inthe markets. I opine that businesses would need to wait for a while to actually see theperceived benefits of GST becoming a reality. A lot depends on the sincerity and approachof the concerned regulators in implementing and monitoring it. In the long run though thesame would definitely benefit the organized businesses.
The year gone by saw a drop in the profitability of our Company. The same was mainlyattributable to the fuel price increase and the unhealthy competition faced by us in thepassenger bus business. Efforts are on internally to identify sustainable supply sourcesfor bio-diesel. We have developed an adequate in house mechanism to pass the fuel pricefluctuations which would henceforth be on a day to day basis. I also do not foresee thecompetition in the passenger bus division to sustain in the long run and we have initiatedremedial measures to ensure that the performance of the said division does not deteriorateany further.
On the capex front we would continue to add to our fleet and infrastructure with along term perspective. We are geared up for the GST implementation and would await thestabilization of the GST regime to suitably direct our business growth strategy.
Lastly I wish to place on record my sincere appreciation of all our employees at alllevels for their wholehearted dedication and efforts. I also thank all the stakeholders -Investors Customers Suppliers Bankers Government authorities Regulators and themanagement team including the Co-Directors on the Board for their continued associationwith VRL.
I look forward to a bright future ahead for the Company.
DR. VIJAY SANKESHWAR
CHAIRMAN & MANAGING DIRECTOR