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GE Power India Ltd.

BSE: 532309 Sector: Engineering
NSE: GEPIL ISIN Code: INE878A01011
BSE 00:00 | 03 Feb 125.50 -1.30






NSE 00:00 | 03 Feb 125.25 -1.85






OPEN 126.15
52-Week high 252.50
52-Week low 123.00
Mkt Cap.(Rs cr) 844
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 126.15
CLOSE 126.80
52-Week high 252.50
52-Week low 123.00
Mkt Cap.(Rs cr) 844
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

GE Power India Ltd. (GEPIL) - Chairman Speech

Company chairman speech

Dear Shareholders

It gives me great pleasure to present the Annual Report on performance of the Companyduring the year ended 31 March 2013. Against a background of fast-changing andunpredictable operating conditions Alstom maintained strength and momentum in the lastfinancial year with robust earnings strong order intake book position and improved salesfrom all of its business segments. The year was marked with solid execution growth andaccomplishment for Alstom's employees and stakeholders as we progress towards our visionof maintaining our leading position in the market.

For a variety of reasons the last year has been a difficult one for the Indian economywhich is suffering the consequences of high fiscal deficit and the Current Account Deficithas grown to twice the size at an unacceptable level of 5.5%. Howeverdriven by strong government policies and positive reforms the Indian infrastructuremarket is on the rise. Despite the challenging environment Alstom India has strengthenedits position as a leading player in its space by winning important contracts andaccomplishing them successfully. There has been very good growth in terms of expansion andinvestments. Till date Alstom in India has installed power projects of 15 GW and 21 GWprojects are under execution. In hydro power Alstom enjoys the number two position with amarket share of 31%

We will continue to build long-term value and meet the evolving needs of ourstakeholders through strategic investments. Our strong order intake suggests that there isgrowth and opportunities in the markets that we operate in - India and South Asianmarkets. However the competition is growing with intensity and the markets are no longerexpanding but contracting so there is a need to remain ever vigilant and work harder tomaintain our position already achieved.

Before I dwell upon about the performance of your Company in the year under review andour future plans I would briefly outline the major developments that framed our operatingenvironment.

Business environment

The electricity sector in India had an installed capacity of 223.625 GW as of April2013 the world's fifth largest. Captive power plants generate an additional 34.444 GW.Non Renewable Power Plants constitute 87.55% of the installed capacity and 12.45% ofRenewable Capacity.

In terms of fuel coal-fired plants account for 57% of India's installedelectricity capacity compared to South Africa's 92%; China's 77%; and Australia's76V After coal renewal hydropower accounts for 19V renewable energy for 12% and naturalgas for about 9V

India currently suffers from a major shortage of electricity generation capacity eventhough it is the world's fourth largest energy consumer after United States China andRussia. The International Energy Agency estimates India needs an investment of at least$135 billion to provide universal access of electricity to its population.

Key implementation challenges for India's electricity sector include new projectmanagement and execution ensuring availability of fuel quantities and qualities lack ofinitiative to develop large coal and natural gas resources present in India landacquisition environmental clearances at state and central government level and trainingof skilled manpower to prevent talent shortages for operating latest technology plants.Domestic demand will increase more rapidly as the quality of life for more Indians improveand India's manufacturing sector is expected to grow faster than in the past.

As per the Rail budget announced on 26 February 2013 a host of projects is now lined upfor the private sector like the Dedicated Freight Corridor (DFC) re-development ofrailway stations power generation energy saving projects freight terminal operationssetting up of wagon and locomotive units gauge conversion and network expansion amongothers.

The magnitude of the Indian Railways' infrastructure upgrade and modernization programhas made private participation an integral component of all developments for keyinitiatives. The ongoing and proposed Metro Rail projects in several Indian citiesincluding Delhi and Mumbai have encouraged large-scale private participation in the areasof providing engines and coaches as well as infrastructure development for both domesticand multinational companies. Furthermore the global railroad transport industry isexpected to hit the $800 billion mark by 2015 according to research from Global IndustryAnalysts.

Your Company is poised to participate and contribute in the emerging opportunities inboth power and rail transport sectors.

Company's Performance

I would like to inform you that during the financial year ended 31 March 2013 yourCompany has achieved revenues of Rs. 27775 million and Profit after tax of Rs. 1837million as against the revenues of Rs. 24121 million and Profit after Tax of Rs. 1678million in the previous fiscal 2011-12. This has resulted in higher earnings per share ofRs. 27.33 as compared to Rs. 24.95 in the previous year.

Keeping this in view your Board of Directors has recommended a dividend of Rs.10/-(100%) per share on the equity shares of the Company.

I would now like to briefly highlight the two segments in which your Company operates:


The year 2012 witnessed sluggishness in the market mainly due to fuel constraint forThermal (Coal & Gas) and statutory clearances for Hydro projects. However Governmentseen taking some measures to revive the sector namely Presidential directive to Coal Indiato implement Fuel Supply Agreements revision of power tariffs restructuring packageoffered to loss making Discoms. Tariff hike for imported coal based new plants is alsoexpected. Furthermore given the aggressive targets being set for the 12th Five Year Planof the Government of India it is still expected that the demand for power equipment andservices will grow in near future. Coal will still be the major fuel for power generation;growth is also expected in nuclear hydro and renewable energy.

Power sector has huge potential to grow and generate significant gains for theinvestors due to the huge market size. The government's efforts to some extent are pavingway for electricity in every household of nation.


It is universally recognized that transport is crucial for sustained growth andmodernization. Adequacy of this vital infrastructure is an important determinant of thesuccess of a nation's effort in diversifying its production base expanding trade andlinking together resources and markets into an integrated economy.

During the financial year under review several opportunities of the Indian Railwaysdid not materialize as anticipated due to deferment and rescheduling. However we willcontinue to seek these out in order to work with Indian Railways to upgrade itsinfrastructure as well as participate in network expansion. On the Metro front we havegradually expanded our footprint and at the same time participated in signalingopportunities with existing customers the results for which are awaited.

During the year our primary focus was on successful and timely execution of contractsfor Jaipur Bangalore and Chennai. We finalized the detailed design for Jaipur and hope tocomplete the work during the current year. We successfully commissioned the BaiyapanhalliDepot for Bangalore Metro. Further as part of our ongoing engagement with Delhi Metro wesuccessfully commissioned the updated signaling system for the first 8 car train forDelhi. This achievement was acknowledged by the Delhi Metro our esteemed customer.

The Transport Information Systems (TIS) operation in Bangalore continues to expand witha greater role being assigned to it in engineering and R&D projects both for local aswell as global customers. It is an important regional centre being equipped to cater tothe APAC region and is gradually acquiring the competence to attain this leadershipposition. We therefore expect the expansion of activities in Bangalore TIS to continue inthe forthcoming year as well. AIL's Transport Unit in Coimbatore is now well geared forthe manufacture of traction components and this will be used on the Metro trains forChennai Metro as well as for serving the global demand.

The Government of India recognizes the importance of the private sector in bridging theresource gap in investment and improving the operational and managerial efficiency in thetransport sector in order to address capacity constraints and deficiencies in the existingtransport infrastructure and meet rapidly growing demand. The Government is activelypursuing policies to promote private sector involvement in the development of transportinfrastructure and services. This will help your Company to increase the volume of itscurrent activities in the transport business.

Environment Health & Safety (EHS)

Your Company conducts its business operations fully respecting and following theinternal EHS Directives and instructions so as to protect the employees contractorscustomers and stakeholders. Your Company's sharp focus on EHS ensures maintaining highstandards of safety health and environment care at all our operating locations.Compliance with relevant regulations and effective management of these issues is anintegral part of the Company's operating philosophy. EHS is managed and controlled in yourCompany through an integrated EHS Management System providing continuous improvement inthe EHS Performance. EHS Management System is based on an "EHS Roadmap" whichhas been developed with the objective that it will become a tool for self-assessment aswell as formal assessments and a management tool to evaluate the performance of EHSSecurity and Loss prevention management for all its sites and identify action points forimprovement.

Established systems and procedures are constantly updated for improvement to achievehigher standards of safety occupational health and environment protection. The Grouplaunched the Alstom Zero Deviation Plan in June 2012 specifically to prevent accidentswhen our employees contractors and other stakeholders are engaged in high riskactivities.

All major locations of your Company have well equipped health care facilities /arrangements. The Company constantly endeavours to create an understanding of EnvironmentHealth and Safety strategy among its employees and how it fits within the context of theorganization and how it contributes to achieve your Company's Goal.

Corporate Social Responsibility

At ALSTOM we believe that Corporate Social Responsibility (CSR) is an opportunity anda privilege to serve the community in which we live. Alstom supports a wide range ofinitiatives based in the heart of communities. The Alstom Foundation identifies andinitiates projects that combine economic development social progress and environmentalprotection.

Through Alstom's collaboration with Husk Power Systems for its groundbreaking DryGasifier project of electrifying rural India we have been able to facilitate inclusiverural development on the backbone of electric power. The project has made significantstrides in the past one year since its inception with the successful creation of aself-sustaining ecosystem in the villages of Bihar. The project aims at improvement ofpower plants by retro-fitting dry gasifiers to 65 small existing biomass plants in thestate of Bihar in India. It will also provide vocational programmes and training for womenthrough manufacture of incense sticks using the ash from these plants. The project has notonly enabled economic development and physical well-being but also helped in strengtheningof the rural communities.

The project aims at improving power plants by converting-retro fitting the existingBiomass gasifier to dry gasifiers thus reducing the consumption of water at the plant.One of the aims of this project was to provide vocational training to women throughmanufacture of incense sticks. There are now 4 manufacturing units all of which togetherproduce 7-10 tonnes of incense sticks per month using char (not ash) from these powerplants.


I wish to take this opportunity to express my sincere gratitude to the members of theBoard of Directors for their professionalism and dedicated contribution to steer theCompany towards excellence. My special thanks also go to the management team and staffmembers for their continued contributions and commitment towards the Company. I also wishto extend our thanks to our valuable shareholders customers business associatesinvestors as well as banking institutions and relevant authorities for their continuedsupport guidance and confidence in the Company. In addition I am particularly thankfulfor the strong support of the ALSTOM Group throughout the year as always.

I look forward to reporting to you on our successes and progress in 2013-14.

With warm regards

Sunand Sharma

Chairman & Whole-time Director

ALSTOM India Limited

20 June 2013