Statement from the management
"Our transformation journey
which commenced in the year 2015-16 has gained traction within the organisation."
We are happy to report that the journey we embarked on in the previous year-one ofbusiness and organisational transformation-has made encouraging progress during the yearunder review.
Our satisfaction stems from the business and profitability growth achieved over theprevious year. While income grew by about 10% over the previous year net profitleapfrogged. And this is a heartening achievement considering the challenging externalenvironment that prevailed during the year under review-consolidation and disruptiveofferings in the telecom segment and a subdued industrial and manufacturing sector.
This motivating performance is the outcome of the team's unwavering focus on meetingthe near-term goals despite all odds. We grew market share for our existingproducts-telecom batteries being a case in point where we significantly reduced the gapwith our peer. We are improving shop floor metrics by altering and fine tuning operationalsystems and processes. We are focusing on refurbishing the facilities to support ourgrowth trajectory. We continue to explore possibilities of monetising surplus assets toimprove cash-flows.
We successfully completed the reverse merger which helped significantly to reduce thedebt and improve debt-equity ratio.
This gives us the confidence that our transformation journey which commenced in theyear 2015-16 has gained traction within the organisation.
The core of our transformation journey is pivoted on a single objective-a ROR (Returnon Resource) focus. This has emerged as the critical prism through which we will filteremerging opportunities business strategies and operational realignments.
Having made a heartening beginning we continue to remain focused on working towardsour medium-term goals-sustaining profitable business growth over the foreseeable future.
In this endeavor we expect our growth and profitability drivers to undergo completetransformation even as we continue to live by our core ethos of filling in technology gapsprevalent in India with our expertise and energy.
Currently our batteries vertical is the critical catalyst for revenue growth andprofitability. In the medium term this would change. For we expect ourtechnology-solutions verticals-railway electronics and defence-to emerge as futurevehicles for shifting the organisation into a higher orbit.
This optimism is based on important realities. In our railway electronics vertical weare readying ourselves for the commercial installation of our TCAS and TMS systems whichhave been successfully inspected and approved by the end user-Indian Railways. This willopen up a large market over the coming years.
Having demonstrated our capability in successfully delivering cutting-edge solutions tothe Indian defence forces we have positioned ourselves as a dependable supplier to thearmed forces.
Further we have made significant headway in establishing ourselves as the partner ofchoice for key components (such as inverters and batteries) to organisations focused ongarnering a sizeable share of India's large solar power opportunity.
To succeed in these high-value high- growth businesses which we expect will take offin the next 18-24 months we are planning to enhance our investments. For this we willneed to augment cash flows and strengthen our people capability.
With this focus we are moving up the battery value chain-into uncluttered space-withconsiderable success. We have successfully secured approvals for submarine batteryvariants and established ourselves as an approved battery supplier to the aerospace sectorwith a product approval from Bombardier.
We are getting into new opportunity spaces with customised products as well. We havedeveloped superior batteries customised for large Data Centre applications and vehiclesused by the Indian army at high altitude and low temperature terrains. We are working onestablishing a meaningful presence in the e-mobility space in the current year. We havere-engineered products for improved performance suited for UPS applications targeted atthe BFSI and IT- ITES sectors.
In addition we are working on building markets for existing products. We are expandingour channel network for a wider and deeper penetration into the domestic market even asour international business development team continues to focus on widening our globalfootprint.
These factors should scale revenues and strengthen cash flow from operations which willbe prudently deployed in building our future businesses.
We understand that the difference between success and failure of business strategy ispeople-the key differentiator in today's highly competitive business environment-forintellectual capital is the key resource that can transform well-thought out businessstrategies into successful on-ground realities.
It gives us great satisfaction to note that our first step towards peopleempowerment-creating strategic business units to be headed by professional leaders-haspaid rich dividends. In keeping with our resolve to empower our team we will continue toinvest in the intellectual capital of our team-through engagement and internaltraining-which will strengthen their capability in undertaking more challengingassignments.
Message to shareholders
At HBL we look forward to exciting times. Investment-inducing andbusinessstrengthening Government policies promise to open a plethora of growthopportunities. We have aligned our business strategies with national priorities; growthwe believe will be a natural corollary. In view of this we are confident of deliveringsignificant value for our stakeholders over the foreseeable future.
On behalf of the Company we take this opportunity to convey our sincere appreciationto all stakeholders governments and shareholders for their unstinted support in takingthe Company forward.
The management team.