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Endurance Technologies Ltd.

BSE: 540153 Sector: Auto
NSE: ENDURANCE ISIN Code: INE913H01037
BSE 00:00 | 11 Aug 1415.75 -14.90
(-1.04%)
OPEN

1425.00

HIGH

1432.80

LOW

1397.75

NSE 00:00 | 11 Aug 1415.40 -17.90
(-1.25%)
OPEN

1419.55

HIGH

1435.90

LOW

1397.00

OPEN 1425.00
PREVIOUS CLOSE 1430.65
VOLUME 11372
52-Week high 1980.95
52-Week low 1047.65
P/E 50.56
Mkt Cap.(Rs cr) 19,914
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1425.00
CLOSE 1430.65
VOLUME 11372
52-Week high 1980.95
52-Week low 1047.65
P/E 50.56
Mkt Cap.(Rs cr) 19,914
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Endurance Technologies Ltd. (ENDURANCE) - Chairman Speech

Company chairman speech

Dear Shareholders

Amid an exceptionally challenging macro environment I am pleased to share that we havereported consistent performance at the back of our prudent business approach and long-termrelationships of trust with customers and other stakeholders. Our overall performance andthe growth we posted in the second half of FY 2020-21 after the slowdown witnessed in theinitial part of the year stands testimony to our deep-rooted strengths. We are confidentthat the learnings of the year gone by will further strengthen our capabilities as we takeon new challenges.

COVID impact

The debilitating impact of the COVID crisis marked by a strict nationwide lockdown atthe start of FY 2020-21 led to serious contraction in the Indian economy in the first twoquarters. The trigger effect on the industry reflected the overall negativity in businesssentiment. The Automobile Industry Associations have pegged daily losses to the automotivesector at around Rs. 2300 crore due to production stoppage at the automotive OriginalEquipment Manufacturers (OEMs) and component suppliers on account of the lockdown.However lockdown relaxations a good harvest and demand stimulation in the festive seasoncatalysed recovery in the sector during the second quarter of FY 2020-21.

As economic activities started opening up in Q2 of the year demand uptick becamevisible particularly in the passenger segment leading to signs of recovery in industrygrowth. The increase in demand was attributed to release of pent-up demand preference forindividual mobility and strong rural economy.

Owing to the second wave which led to new lockdowns in various states our sales inIndia have once again been affected in Q1 of FY 2021-22. However drawing from thelearnings of the previous fiscal we have again started taking measures on fixed costvariable cost raw materials and CAPEX controls with full focus on generating positivecash flows. We believe these measures will help us sustain the growth momentum that theCompany had witnessed from the second half of FY 2020-21.

Sharpening the edge – from planning to execution

The unprecedented COVID crisis that hit business at the start of FY 2020-21 brought anew set of complexities into operations. It necessitated some prompt and proactive stepsto put new policies and plans into action with increased focus on operationalefficiencies backed by cost optimisation. While maintaining business continuity it alsorequired us to support the society in _ghting the pandemic. From providing safety kits andtransportation facilities for employees to setting up a 81-bed Covid Care Centre incollaboration with the local administration in Aurangabad we put all our resources intotackling the challenges that the pandemic had thrown at us.

Safety measures were strengthened and customer deliveries were maintained even if itentailed providing safe accommodation for some employees at the workplace during thelockdown period. At the same time we worked in a focussed manner on fixed and variablecost reduction. We also curtailed capex to protect our cash flow. As a result of ourcomfortable liquidity position we did not need to avail the COVID-specific credit linesgranted by the lead bank in our consortium. Concurrently we looked ahead to plan for theresumption of normal business post the lockdown period.

As the situation started easing towards the second quarter of FY 2020-21 we respondedwith agility to adapt to the new business realities. We adjusted quickly to the new normalof overcoming constraints posed by the unprecedented scenario and continued meeting ourcustomer requirements. We restructured our systems and processes to maintain businesscontinuity with strict adherence to the Standard Operating Procedures (SOPs) at thefacilities and other workplaces. We initiated several measures to ensure compliance to allnorms of hygiene and social distancing at the factories and offices.

At the same time we accelerated our efforts to become leaner in terms of people. Wefocussed concertedly on promoting efficiencies while lowering our monthly fixed costamounts variable cost percentage to sales in our plants direct and indirect materialcost as well as CAPEX. The thrust was on generating free cash flows and steering theCompany through the challenging times. We energised our efforts to streamline the supplychain which was hit adversely by the lockdown restrictions. We also invested in gettingour labour force back at the facilities from their places of residence by providing themlong-distance transportation. Further to give confidence to our suppliers we releasedpayments in time and in certain cases also advanced the release of payments to them. Wealso supported our vendors by providing logistics support to them for supply of materialand even helping them get labour for their operations. These measures enabled us to getall the components on time and to meet the tight schedules of clients many of whomexpressed their appreciation for our efforts.

Our business recovery was further aided by our efforts to maintain quality of ourproducts despite the new work norms bring greater efficiencies into our systems andprocesses and contribute to the holistic development of our people and the communitiesaround which we operate.

The results of these strategic interventions led to quick recovery of our business postthe lockdown. The lockdown had a significant impact on our financial performance and hadcaused a substantial decline in the topline for Q1. However post July sales picked upconsiderably enabling us to bring growth back on track as evident in a good set ofnumbers for FY 2020-21 including in our exports and aftermarket business. Our focussedefforts to enhance our product mix mainly through offerings in our proprietary businessfor higher cc vehicles and fully machined castings business also enabled us to stay oncourse of growth and value delivery to our stakeholders. We believe that our renewed focuson cost and waste reduction will ensure healthy margins in the long-term too.

We believe that cumulatively our initiatives of FY 2020-21 have translated in thereinforcement of the Endurance Edge during the year across every parameter of importance– from trust to leadership quality innovation efficiencies people safety andsustainability.

Way forward

The success of our strategic reorientation in a year that threw up unpredictablechallenges has empowered us with a strong and competitive edge which prepares us totackle any challenge effectively in the fast-transforming external environment. Led by ourcommitment to drive inclusive progress and value creation for all stakeholders we shallcontinue to focus on growing sustainably in our existing business and in new areastargeted through organic and inorganic means.

At the heart of our strategic approach for the future will be our consistent thrust ontechnology upgradation quality improvement cost competitiveness environment health andsafety. We shall explore areas of profitable growth in terms of both products andgeographies. We will further strengthen our focus on more value-added and profitableproduct mix in our future business. The objective will also be to supply components fromall our four product segments to all OEMs in the next few years.

We also see significant opportunity for expansion and growth in EV and hybrid vehicleapplications in the coming years. We are also looking at harnessing the growth potentialin the aftermarkets in new geographies and launch of more value-added traded products.

I am confident that with your support and cooperation we shall continue to chart moremilestones of success in our onward journey. On this note on behalf of the Management andthe Board I would like to thank all our shareholders customers supply chain partnerstechnology partners and all our employees for standing with us through these turbulenttimes.

Anurang Jain

Managing Director

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