On behalf of the Board and the Employees let me welcome you to the 26th Annual GeneralMeeting and thank you for being a part of the Emmbi family. I'm pleased to present to youthat we have overcome the challenges and fragilities of both the global and domesticeconomy and once again delivered a double-digit growth in volume and single digit growthin value. We at Emmbi strongly believe that crisis provides an opportunity to pausereflect and re-set to a better future - be it at an individual level or an institutionallevel. Our continual investments into research robotic technology flexible manufacturingtechniques people enrichment has enabled us to sustain growth in both normal and verychallenging times.
The global growth for calendar 2019 was just below 3.00% perhaps the weakest pace inover a decade. Whilst cyclical and structural changes in most economies played a rolethis was accentuated by trade barriers and uncertainty which led to lower investmentsacross industry. The IMF pointed out that weaker spending on machinery equipment andconsumer durable goods was an important factor to the global slow-down. Many central banksresponded by both cutting rates and engaging in asset purchases. Emmbi's prominent exportmarket the US grew at 2.10% whilst Europe at 1.20%. The forecasts for 2020 on accountof Covid19 are not at all encouraging at the global level and if there one it may benegligible.
The Indian economy slowed down and the growth was estimated at 5.00% on account of ahost of factors - slowing consumer demand pace of pay increases lower compared toprevious years sluggish exports and lower industrial production especially automobiles.On the positive side farm incomes rural spending remained healthy as was also higherproduction of fertilisers cement (led by the government related infra projects) coal andsteel production. The outlook seems very uncertain as the Covid-19 situation may lead toat least a 20~25% shaving-off on current production and consumption levels domesticallyand almost similar globally.
2020- Achievements and Abilty to make growth a 'Sustainable' proposition
We have now become the world's largest pond lining company and continue to conserveover a billion litres of water each month. The extension of this business came in the formof introduction of shrimps and fish farming ponds and the technological nature of thetextile (an intellectual property of Emmbi). This gave us a distinct advantage over peers.We have also launched a small-ticket value items such as Kapila Silage bags Jalakumbhbio-flocking solutions Anant Packaging Bags Rakshak Tarpaulin and Prabal Farming Thread.These will be sold in 300 SBOs and 500 MBOs by the end of the year.
I am happy to make a mention of Project 'Manthan' which is an ongoing initiative toreduce wastage increase operational efficiency and bring down costs of operation; I canproudly state that this has resulted in cost-savings of around 100 - 120 bps. The 5S andKaizen techniques and the additional certifications received has placed the factoryamongst the best in the industry.
I had pointed out last year that to build a world class company the business modelneeds to be both sustainable and profitable. What makes a company sustainable - a simpleand yet important way to look at it is achieve consistent growth in-line with pre-definedoperational and financial policies. The Emmbi way of looking at sustainable growth is toalso include the 5Cs. Clients Competitors Costs Capital Community The first beingClients for they help us grow; at Emmbi we have been blessed to have a diverse range ofclients both in terms of products and geographies. The next is Competitors - we areaware and work on the premise that our present peers could well be allies in the futurefrom a collaboration or an idea sharing perspective. A close monitoring of Costs helps usgrow even in challenging times with minimal trade-off on margins. We are incrediblycareful on the allocation of Capital as misallocation can not only lead to a waste ofresources but also amplify risks. Most significantly we are always grateful to theCommunity of our stakeholders who has been the soul of this company and very reason forits existence.
Whilst I see the road ahead is going to be full of hardships and sacrifices I do notsee despair and am reasonably confident that even under such circumstances we wouldcontinue to grow without sacrificing the interests of our stakeholders. This year'sAnnual Report theme Hope continues to guide us through this tough time but we are surethat we will sail through with your support and best wishes.
I once again thank all our stakeholders for the faith entrusted upon us.
Chairman & Managing Director