It gives me pleasure to present to you the Bharat Rasayan LimitedAnnual Report 2019-20. While this was a year of extreme economic challenges for the worlda situation aggravated almost beyond measure by the unprecedented Covid-19 pandemic yourCompany continued to play on its strengths and posted a stable financial performance. It'sa pleasure to share with you the highlights of the progress being made by the Companysince we met approximately twelve months back.
I am pleased to share with you an update on your Company's performancefor the financial year 2019-20. The year saw a challenging business environment with lowerGDP growth and slowdown in consumption. The novel coronavirus has affected not just humanhealth but severely impacted businesses and the society at large. The macro-economicfactors that caused a slowdown in FY 2019-20 will continue in FY 2020-21 with the firsthalf of Calendar Year (CY) 2020 completely dominated by the pandemic and the consequentlockdowns. During the last few weeks in March we started to see the impact of COVID-19.The Covid-19 outbreak from China was declared a pandemic by World Health Organisation inthe last quarter of the financial year causing a social and economic turbulence.
Amidst a challenging scenario our strong portfolio distributionnetwork and brand equity enabled us to deliver a steady performance. It gives me greatpleasure to share with you an update on the overall performance of your Company whichperformed well and delivered another year of profit. I am glad to inform you that yourCompany continues to perform well on a sustained basis. Your Company achieved a turnoverof ' 1231.87 crores registering an increase of about 23.84% over previous year turnover of' 994.69 crores and earned a Profit before Tax (PBT) of Rs. 205.19 crores and Profit afterTax (PAT) of ' 157.64 crores.
The Company i.e. Bharat Rasayan Limited (BRL) has executed a JointVenture ("JV") Agreement on 18.02.2020 with Nissan Chemical Corporation (NCC)a company incorporated in Japan and with Nissan Bharat Rasayan Pvt. Limited a companyincorporated in India ("JV" Company). The joint venture will operate through acompany named 'Nissan Bharat Rasayan Private Limited' a company incorporated in India inwhich BRL has 30% share and NCC has 70% share. The Joint Venture Company i.e. NissanBharat Rasayan Private Limited has decided to construct new manufacturing factory in Indiafor various technical products. Nissan Chemical Corporation is a research based Companyand is one of the largest manufacturers of agrochemicals in Japan having globaloperations. Nissan Chemical Corporation has developed good relationship of mutual trustwith Bharat Rasayan Limited and thus Nissan Chemical Corporation wants to enter into jointventure with Bharat Rasayan Limited.
We are making the right investments to scale this business higher. Wehave already made investments towards expanding our manufacturing capacities setting upnew capacities for critical inputs as part of backward integration acquiring more productregistrations and thrust on R&D for developing relevant products for key markets.
Agro Economy Overview
India has come a long way in achieving self-sufficiency in food and isemerging as an important player in global trade of agricultural commodities. This is inspite of our relatively low productivity compared to the global benchmark. One of themajor reasons for this low productivity is the gap in adopting appropriate agriculturetechnologies compared to leading agricultural economies. Seeds and Crop Protection areimportant elements driving agricultural productivity.
During the year delayed and unseasonal rainfall led to a flood-likesituation across the country adversely impacting the Kharif season but favourablyimpacting the Rabi season with good groundwater levels.
The latest advance estimates for FY 2019-20 for total foodgrainproduction in India is estimated at record 295 million tonnes higher by 10 million tonnesover the previous year.
Indian agriculture is on a growth path with an increase in investmentsand private funding in the past few years. The sector is expected to grow with bettermomentum in the next few years owing to an increase in investment in agriculturalinfrastructure such as irrigation facilities warehousing and cold storage. Factors suchas reduced transaction costs time better port gate management and fiscal incentives willalso contribute to this upward trend. Furthermore the increased use of geneticallymodified crops is also expected to better the yield of the Indian farmers.
Considering the consistent profits being made by the Company yourDirectors have recommended a dividend of Rs. 1.50 (i.e. 15%) per equity share for thefinancial year 2019-20.
Health Safety and Environment
Your Company continues to conduct business with a strong commitment forenvironment preservation sustainable development safe workplaces and enrichment of thequality of life of its stakeholders and the community at large by maintaining the requiredISO standards Certification.
The Covid-19 pandemic may have an extended impact but as I mentionedearlier this means opportunities as well as challenges. The Board through its engagementwith the management will guide the Company in recalibrating its growth strategy toaddress these challenges and to make use of the new opportunities. On behalf of the Boardwe seek support from each and every stakeholder to bring prosperity to one and all.
Before I conclude I would like to place on record my appreciation toall my colleagues on the Board past and present for their valuable contribution in thegrowth of the Company. Finally I would like to thank you our valued shareholders foryour unwavering support in our journey to deliver value to all our stakeholders.
Thank you ladies and gentlemen.
SAT NARAIN GUPTA Chairman & Managing Director