The year 2020-21 has been awfully challenging for each one of us. The COVID-19 pandemicupended the world and caused unprecedented disruption in more ways than one could haveimagined. And yet this year will define for many years to come the strength of ourcollective will which saw us through. I have no doubt that this strength will help usface what lies ahead.
The world has been fighting the Covid-19 pandemic for over a year. In 2020 the globaleconomy contracted by 3.3% the largest contraction on record at least since WorldWar-II. Much of it was concentrated in the first half of our fiscal year FY21 as severalcountries enforced strict lockdowns. Economies bounced back in subsequent quarters on theback of large fiscal stimulus packages and improved confidence levels following the startof the vaccination programme.
The latest IMF forecast suggests a strong 6% growth in global GDP in 2021. Theoccurrence of the second and third waves of Covid-19 in different parts of the world andreports of virus mutations have created downside risks to the outlook of a strong growthrebound.
Indias Covid-19 case load has been the highest. We are all collectivelystruggling to stem this extremely challenging and huge calamity. The Government NGOscorporates and other key stakeholders have coalesced to bring Covid-19 relief measures.Even at the cost of being repetitive let us acknowledge our nations doctorsmedical and paramedical workers. They have and continue to go beyond the line of duty tobring succor to the Covid-19 afflicted. Our population and the size of our country isbeyond comparison. Enormous challenges confront us. We can overcome them with a strongsense of solidarity.
The double-digit GDP growth expectations for India in FY22 have been pared. Disruptionsto production and supply chains have however been far less severe during the second wavethan during the first wave. Vaccination is expected to pick up pace in the coming monthswhich would support normalisation of mobility levels and of related economic activities.Continued accommodative monetary policy of the RBI and the expected increase in capex fromthe Government will be the other facilitating factors helping the economy to steerthrough this difficult phase.
Quite in contrast to the near-term challenges the longer-term prospects for the Indianeconomy continue to be robust. Various initiatives including privatisation of publicsector enterprises monetisation of assets implementation of National InfrastructurePipeline targeted investment incentives through the Production-Linked Incentives Schemeand the new Labour Code are likely to spur a virtuous cycle of investments and growth inthe medium-term.
Your Companys Performance
Your Company traversed the unchartered economic and social landscape drawn by Covid-19remarkably well. Your Companys performance in the year 2020-21 was in fact betterthan the previous year.
The performance of your Company in the first half of the financial year was severelyimpacted as operations were suspended for nearly two months pursuant to Governmentdirectives of lockdown. The recovery in the second half was impressive. Your Companyachieved record production and sales volume both in Nylon Tyre Cord Fabric (NTCF) andNylon Filament Yarn (NFY). This became possible because of Proactive management ofCovid-19. Your Company focused on several measures among which were training on Covid-19appropriate behaviour ensuring social distancing at workplace appropriate change inshift schedules work from home (WFH) wherever possible frequent sanitisationvaccination camps for employees and mass rapid tests to identify asymptomatic cases. Thesupport dedication commitment and discipline of employees at every level was the keyenabler in your Company achieving this remarkable operating performance even in toughtimes.
The second wave of Covid-19 has been a nightmare. Again your Companys employeesdemonstrated amazing resilience and helped minimise the impact on performance. Besides ourcolleagues we extended every effort to help communities fight Covid-19.
The sudden spurt in demand globally resulting in shortage of material for importsrestriction on tyre imports anti-dumping duty on truck and bus radials bolstered thelocal demand for tyres. A good monsoon and increased Government spending on infrastructureboosted demand for farm and OTR (Off-the road) tyres. These factors resulted in anoverwhelming demand for NTCF. Demand for NFY was also encouraging aided by empty pipelinesand global supply disruption.
Like all other commodities prices of our major raw materials rose significantly.Furthermore robust demand for both NTCF and NFY enabled your Company pass on thisincrease to the customers. Given this notable performance the management has laid outaggressive expansion plans for reinforcement products which will enable your Companyscale newer heights.
Transcending business your Companys CSR initiatives are fixated on a holisticmodel encompassing education healthcare sustainable livelihood inclusive of ruraldevelopment and women empowerment processes. We remain deeply invested in making adifference to the lives of the underprivileged as well as inclusive growth.
I most sincerely appreciate the guidance accorded by our Board of Directors. Ourgratitude goes to all our stakeholders for reposing their faith in your Company. A specialapplause is in order for the entire team at Century Enka all of whom have enabled usreach this far.
Heres wishing you and your loved ones good health for all times to come.