The world around us is dynamically changing providing us ample opportunities to createtechnological solutions for the future and progress collectively in "Making MaterialsMatter."
The year 2017-18 turned out to be a very good year for CUMI with revenue growthresuming double digit levels driven by better performance across all major segments. Theglobal economy grew with a broad based momentum from continuing strong performance in theEuro region Japan China and the United States. With the world economy enjoying asynchronised recovery the emerging and developing economies also grew at a notable pace.The growth in advanced economies is forecasted to continue in the near term and the growthin emerging market and developing economies is expected to rise as well. Indian economicgrowth is also projected to increase lifted by strong private consumption as well as thediminishing transitory effects of the changes in its tax regime.
CUMI its subsidiaries and joint venture companies had a good year with consolidatedrevenues (after normalising for excise duty) increasing by twelve per cent over theprevious year. The recommissioning of the relocated plants from overseas across variouslocations into India were completed successfully ably aiding the growth in overalloperations. With a firm focus on delivering operational efficiencies through TotalProductive Maintenance (TPM) practices across all plants not only did the productionefficiency improve but also it enhanced the overall profitability duly supported byprudent cost management efforts. It gives me immense pleasure to share with you that whilethe Industrial Ceramics and Bonded Abrasives plants of the Company at Hosur Tamilnaduwere awarded the JIPM excellence award in TPM after a very rigorous evaluation this yearthe plants in Sriperumbudur and Maraimalai Nagar recipients of the excellence awards inthe year 2014-15 were conferred consistent TPM commitment awards in due recognition oftheir sustainable practices. The capital expenditure programmes which were predominantlyfor relocation and maintenance were well executed. Prudent working capital managementcontinued to keep the Company debt free and capital expenditure was met from internalaccruals.
Abrasives CUMI's largest business segment recorded a nine per cent growth during theyear riding on macro-economic factors like infrastructure development as well as itsstrengths of new products and expanding dealer & distribution network. Though the yearcommenced on a challenging note with the implementation of the Goods and Service Taxescreating some uncertainty in the distribution network the business improved subsequently.The business maintained its competitive edge by increasing indigenous sourcing of inputmaterials and bringing in better efficiencies through TPM practices across plants. Withthe Russian subsidiary Volzskhy Abrasive Works introducing newer products and exploringnewer territories the Abrasives sales in Russia was also higher this year. SterlingAbrasives the Indian subsidiary manufacturing specialist conventional Abrasives performedwell. Wendt India the joint venture company which addresses the Super Abrasives Grindingmachines & Precision components market also delivered better
The year 2017-18 continued to be a year of accolades and recognitions for CUMI. Besidesbeing the recipient of the coveted TPM excellence awards across various businessdivisions CUMI also received the prestigious Golden Peacock award in the engineeringsector for Corporate Governance in due recognition of its governance practices. TheElectrominerals division was conferred the HR excellence by the Confederation of IndianIndustry (CII).
The CUMI Centre for Skill development (CCSD) the CSR initiative of CUMI addressing thetraining and development requirements of rural and underprivileged youth and honing theirskills for future employment continued to function well. The year witnessed the graduationof the first and second batch of students who not only passed with flying colours but wenton to be adjudged as winners in various regional and national level skill competitions.
Safety at the workplace continues to be top priority and receives highest attentionfrom the Board. Besides periodic training and awareness sessions dedicated safetytraining workshops were held for identification and elimination of unsafe workingconditions. The Safety Health and Environment risks are periodically monitored and themitigation measures are reviewed considering its paramount significance on the operations.
While supporting the businesses in fulfilling their strategic intent and directionsthe various teams at corporate office have been very agile in adapting to the dynamicregulatory scenario not only ensuring compliance but also in quickly aligning theprocesses and procedures to the revised regulatory norms.
The CUMI team across the world under the able leadership of Mr. K Srinivasan ManagingDirector and leaders across geographies pursues the core objective of engineeringthe future with excellence. During my interaction with them during visits I'm mosttouched by their commitment and passion. It is indeed very gratifying to see themdevelop capabilities with conviction and confidence to address the future opportunities.Mr. R Rajagopalan after having served the Company for over 38 years retired as theBusiness Head of the Refractories division. We wish him well in his retirement. We welcomeMr. V G Rajendran who has taken over the helm of affairs of this division from Mr.Rajagopalan. I also wish to acknowledge Mr. Sridharan Rangarajan's valuable contributionto the Company during his term as Chief Financial Officer (CFO) since 2011 before movingto the Group in January 2018 as its CFO.
CUMI's Board of Directors continue to be a source of great inspiration and wise counselto me. Their exercise of sound judgement while advising the team and me personally on thebusiness as well as challenging us to greater levels of achievement is most commendableand Im thankful to them for being generous with their time and wisdom.
I take this opportunity to pay homage to Late Mr. M V Murugappan former Chairman ofthe Company who passed away on 19th September 2017 at the age of 81. Mr. M VMurugappan had been longest serving Managing Director of the Company from 1979 to 2000before he took over the Chairmanship. Under his leadership CUMI not only grew as India'sleading manufacturer of Abrasives but his vision for technological leadership in thedomain of materials led to several expansions including setting up of Industrial Ceramicsdivision as well as investments in backward integration projects in hydro-electric andthermal energy projects which were far ahead of times and continuing to give us acompetitive edge even today.
The world around us is dynamically changing providing us ample opportunities to createtechnological solutions for the future and progress collectively in "Making MaterialsMatter." Towards this the encouragement and unstinted support we receive from eachof our stakeholders be it customers suppliers vendors bankers and of course youshareholders is indeed wonderful for which my colleagues and I are most grateful.
|With warm regards |
|M M Murugappan |