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AYM Syntex Ltd.

BSE: 508933 Sector: Industrials
NSE: AYMSYNTEX ISIN Code: INE193B01039
BSE 00:00 | 20 May 104.45 2.10
(2.05%)
OPEN

102.35

HIGH

105.00

LOW

101.65

NSE 00:00 | 20 May 103.55
(%)
OPEN

102.30

HIGH

105.15

LOW

102.30

OPEN 102.35
PREVIOUS CLOSE 102.35
VOLUME 2900
52-Week high 158.50
52-Week low 59.70
P/E 10.32
Mkt Cap.(Rs cr) 524
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 102.35
CLOSE 102.35
VOLUME 2900
52-Week high 158.50
52-Week low 59.70
P/E 10.32
Mkt Cap.(Rs cr) 524
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

AYM Syntex Ltd. (AYMSYNTEX) - Chairman Speech

Company chairman speech

Dear Shareholders

FY 2021 was another year amongst a string of years since 2016 marked by major externaldisruptions to our business. Covid-19 wreaked havoc across the world affecting demand inthe first half of the year and supply chains across the second. Like with all of thedifficult years before this one I believe that we have ended this year a strongerorganization as compared to when we started. We have several things to be proud of:

• We ended the year with the highest ever quarterly EBITDA of Rs 43 crore. Themargins stood at 12%.

• We successfully executed Several low-capex throughput improvement initiativesacross almost every area of the plant thereby improving output further. This was donethrough a mix of efficiency improvements speed increases and engineering. This has led torecord tonnage and improved profitability on a sustained basis.

• Our share of exports which was under 20% when we started this journey in 2016 isnow inching closer to 50%. We expect this number to increase going forward. Thisdiversifies and de-risks our business to country risks and events such as demonetizationGST covid waves etc.

• We launched a number of new products this year and I am extremely excited aboutmany of these. Few of these products have been liked by our customers who are currentlycarrying out commercialization trials. We have filed for patents for few of theseproducts.

• The Palghar plant which we have been struggling with in the past has seen adramatic turnaround this year. We have been able to significantly improve cost and bringdown the breakeven volume. The business is now a lot more competitive and I also feel goodabout some of the business development initiatives which should help us finally see someimprovement in volumes.

• The share of our innovative and value added products and brands such IDYWonderfeel Comfeel SDN Ecose and Silkenza further increased as a percentage of totalsales.

H2 FY21 was an important milestone for us as it ratified what the business could do ina more positive external environment. However despite the numbers that we achieved in Q4there are opportunities to achieve further improvement. We benchmarked our operationsagainst other players in the market and found that there is still scope to improvefurther. While we continue to specialize more move up the value chain and enter nichespaces not catered to by local competition we already happen to have one of the mostspecialized and diverse product mix in the country today. If we can operate our plants atthe industry median level of efficiency our margins will better reflect the quality ofbusiness and customer we already have. There are plenty of opportunities particularly inthe Rakholi plant to improve output to input yield machine speeds value lossesconversion costs 0EE amongst others and bring it at par with industry. This is one of thelowest hanging fruits available to us to significantly improve profitability. The samebusiness without product mix improvement can look very different if we achieve this.

As we start to see some consistency in results it is also important to look to growareas of the business which show promise and are in line with our strategic direction suchas industrial yarns and flooring yarns in a highly calibrated manner. I say calibrated asit is important to continue our journey of deleveraging and strengthening the balancesheet. We also need to effectively use outsourcing as a tool to move out parts of thebusiness which can be capital intensive or more suited to volume-based commodity playersand be easily sourced at competitive prices. This will help us to ensure that we onlydeploy capital to grow parts of the business where the product is differentiated there isa strategic barrier to entry and in cases which promise a healthy return on investedcapital in a sustained fashion. Finally it is important to continue to remain close tothe customer and continue to innovate based on their need. With a good portfolio ofproducts available the focus needs to be to commercialize some of these developments.This will allow us to always stay a step ahead of the competition.

While the past 5 years have been difficult for AYM I continue to believe that theannual financial results do not completely depict the quality of progress we have made inthe journey of transformation over these last few years. As we execute on some of theareas I have highlighted above and a little bit of a supportive business environment aswas evident in Q41 am certain our performance can look vastly different.

I would finally like to end this letter on a note of thanks to all our shareholderswho have continued to support us through this journey. Finally I would also like to thankall of our employees for continuing to believe in our vision and working tirelesslytowards it.

Yours Sincerely
Sd/-
Abhishek Mandawewala
Managing Director & CEO

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