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GMM Pfaudler Ltd.

BSE: 505255 Sector: Engineering
NSE: GMMPFAUDLR ISIN Code: INE541A01023
BSE 00:00 | 29 Nov 4342.85 -172.65
(-3.82%)
OPEN

4450.00

HIGH

4469.95

LOW

4273.45

NSE 00:00 | 29 Nov 4342.25 -157.65
(-3.50%)
OPEN

4480.00

HIGH

4489.85

LOW

4300.10

OPEN 4450.00
PREVIOUS CLOSE 4515.50
VOLUME 6253
52-Week high 5435.00
52-Week low 3463.25
P/E 58.36
Mkt Cap.(Rs cr) 6,341
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 4450.00
CLOSE 4515.50
VOLUME 6253
52-Week high 5435.00
52-Week low 3463.25
P/E 58.36
Mkt Cap.(Rs cr) 6,341
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

GMM Pfaudler Ltd. (GMMPFAUDLR) - Chairman Speech

Company chairman speech

Dear shareholders FY21 has been a very uncertain and difficult year for most of us.With challenges and obstacles successes and victories we've had our ups and downs.However these challenges like in the past have helped us adapt evolve and be moreprepared for what is to come. As we bring in the new financial year there is much to lookforward to.

We continued to show significant improvement in terms of revenue; we reported astandalone and consolidated revenue growth of 24% and 69% respectively over the previousyear. The profit before tax on a standalone basis was up by 53%; however on aconsolidated basis was down by 26% due to acquisition related expenditure.

On the business front and from a strategic perspective FY21 has been an eventful andmemorable year. We completed three important and transformative transactions that willhelp us sustain business growth and continuity over the long-term.

1) In June 2020 we announced the acquisition of a manufacturing facility inHyderabad for a total consideration of € 6 million (approximately H 545 million).This facility will give us access to ready-made Glass Lined Equipment manufacturingcapacity which will further strengthen our presence in the region. We are now well poisedto better serve our customers in the South and take advantage of the expected investmentin the upcoming Pharma City in Hyderabad. We have commenced operations at this unit onOctober 19 2020.

2) In August 2020 we announced the acquisition of a majority stake in the globalbusiness of our parent the Pfaudler Group for a total consideration of US$ 27 million(approximately H 2015 million). This transaction is unique from a business perspectiveas it will bring synergies at different levels within the organization. We consider this astrategic move into the global chemical and pharmaceutical markets that will create valuefor all stakeholders and is aligned to our commitment to further invest and grow thebusiness. This acquisition will also allow us to chart our own course and control ourdestiny and at the same time de-risk our dependence on the Indian market. On a personallevel and as the third generation of a family business that began in 1962 it is a momentof great pride to see GMM Pfaudler enter the global stage.

3) In March 2021 we announced the acquisition of a manufacturing facility inAhmedabad for a total consideration of H 584 million. This state-of-the-art facility willsignificantly enhance our capacity in Heavy Engineering while freeing up capacity inKaramsad to expand our Glass Lining business perfectly fitting into our long-term goalsof expanding both these business lines.

It was a very timely opportunity as we would have run out of Heavy Engineering capacityby the end of the current year and a new factory would take anywhere between 24-28 monthsto become operational. We have commenced operations at this unit on May 24 2021.

As one journey ends another one begins. In FY22 we will be embark on our Journey 2.0.As we join hands and begin working closely with the Pfaudler group I am particularlyexcited of what we can achieve together. With 13 manufacturing facilities across 8countries and employing more than 1500 people GMM Pfaudler is now truly a globalbusiness.

Being a global business comes with its own set of challenges however I am confidentthat we will rise to the occasion and create value for all our stakeholders.

When we began thinking of this acquisition we came up with three areas that we believewould create synergies and help improve revenue and profitability. Value SourcingOperational Excellence and Cross Selling are the three simple pillars of our integrationefforts. Value sourcing will focus on using low-cost production sites to improve marketshare in price sensitive markets operational excellence will focus on improvingthroughput across our manufacturing sites and cross-selling will focus on selling a widerrange of products to our existing customers. The integration process will take time andwill need constant monitoring. However having worked with Pfaudler International fornearly two decades we are well aware of their culture systems and processes. Moreoverthe senior management team of the international businesses are completely aligned and willcontinue to be part of our journey 2.0. The journey ahead of us is indeed exciting. Ourpassion professionalism and perseverance of working with our customers partners and witheach other provides us with an exceptional outlook for the future. When COVID-19 hitIndia in March of last year most businesses were facing unprecedented times. With thesubsequent nationwide lockdown work from home became the new norm supply chains werethrown into chaos our customers postponed investments decisions and logistics andtransportation came to a standstill. Our immediate focus was not only on businessstabilization and continuity but also on the health and wellbeing of our employees. Welaunched multiple initiatives that would keep the safety motivation and the well-being ofour employees at the forefront.

As part of our Covid relief efforts we provided financial assistance to Shree KrishnaHospital Karamsad Gujarat for setting up 20 ICU Beds 9 Non-invasive Ventilators and 9High Flow Therapy machines. Our contribution has helped Shree Krishna Hospital adesignated COVID treatment facility in providing critical care to COVID patients in andaround Anand Gujarat.

As a responsible corporate citizen our Company is committed to improve and enrich thelives of the communities that we operate in through sustainable development and inclusivegrowth. As per our Company's CSR policy we will continue to focus on issues relating tohealthcare education and the environment We are thankful for all the hard work that ourCSR partners Charutar Arogya Mandal JVP ITI and ReefWatch Marine Conservation continueto put in tirelessly working to improve the economic social and environmental aspects ofour society.

I have always believed that our employees are our most important asset. Without theirhard work and determination we would not be where we are today. They have always risen tothe challenge and even today as I write this letter I must convey my heartfelt gratitudeand recognize each and every one of them for the incredible effort that they have put induring these challenging times. Before I conclude I would like to place on record myappreciation to the Board of Directors for ensuring effective corporate governance andthank them for their continued support and guidance. I would also like to acknowledge allour employees customers supplier partners and shareholders for their support and faithin GMM Pfaudler. Thank you for being a part of our exciting journey.

"We stand firm in our commitment to build a sustainable business and delivervalue to all our stakeholders."

Warm regards
Tarak Patel
MANAGING DIRECTOR

.