In the financial year 2019 all that could go amiss did!
Over the last 40 years we have weathered many a storm impacting one or the othersector of our business. During these times our balanced risk mitigating and diverseproduct / market portfolio of Pharmaceutical Chemicals Mining Chemicals and Fertilisershas always come to the rescue. Rarely have we had destiny present us challenges on allsectors simultaneously:
Unprecedented raw material price hike across all sectors
Major supplier constraints
Acute water shortages at manufacturing complex
Drought hitting fertiliser markets
Severe financial debt market crisis
Massive volatility impacting trading arising out of USA-Iran relations threats
Our top management team converged into a think- tank evaluating each challenge andcreating various scenarios. This team then wind-tunneled each available option to puttogether a meticulous plan of action to mitigate this crisis. We reviewed and cut costswe moved to alternative supply points we reworked better logistics sharpened our productmix recast trading basket and innovated our water management....
Our single-minded focus and resilient determination bore visible and valuable results.Some of these I wish to share with you include:
A significant jump of 27% of TAN revenue growth over previous year
A rise of 18% in the Acid business revenue over last year
Reduction of over Rs. 1000 crores in working capital from high octanecollection drive and consolidation of trading portfolio
Debt reduction of Rs. 500 crore and achieving zero commercial paper
Our overall product basket now reflected 65% tilt towards the more profitableChemical sector
Uniquely Differentiated Performance fertiliser crossing 43% of the commodity NPKbasket
Commencement of the new Acid Complex at Dahej with accelerated plant capacityutilisation
Over 50% savings in demurrage from proactive management of port-plant logistics
800 KL per day savings from better water conservatism
With a larger vision to become future-ready and future- relevant we have embarked on ajourney of transformation from:
Product to Solutions
Customer to Consumer
Commodities to Brands
As part of this transformation we have already started to shift from:
Generic Fertilisers to Crop Specific Performance Nutrients
Technical Ammonium Nitrate products to Mining Solutions
Commodity Chemicals to End-use Certified and Customised Chemicals
Our transformation strategies and growth plan have been strongly validated byInternational Financial Corporation Washington who have joined us as strategic alliancepartners bringing invaluable global sectorial knowledge and experience.
Our strategic transformative drive has likewise caught the attention of SectorialGlobal Leaders who have shown keenness in associating with us as they embark on theirjourney into India.
The next few years will see us radically transform from a Commodities mindset tocreating Customised Solutions and Brands. This will in turn see us move from Competitionpricing to Value pricing. This shift will be bolstered by our capacity enhancement andbackward integration capex plan cementing a solid foundation for sustained returns in themedium and long term. Moving ahead our financial game plan will see monetization ofnon-core assets equity infusions from the promoters strategic partners and capitalmarkets along with the next level of restructuring to reflect sectorial focus.
With faith and conviction we need to dare!
S. C. Mehta
Chairman & Managing Director