Prepared for the future
The year under review was extraordinary with a once-in-a- century pandemic testing ourability to face uncertainties on a scale never imagined and still deliver on stakeholdercommitments; coming on the back of a year which was challenging in itself it has proventhat our fully integrated business model and established relationships with customers andsuppliers alike give us the strength to overcome any challenge. Of course none of thiswould have been possible without our committed workforce. Our priority in thesechallenging times is to protect our workforce further strengthen our balance sheet pushahead with our expansion plans in due course and set the course for long term growth.
FY21 started on a mixed note with a national lockdown underlining the challenges ofoperating during a pandemic but large fiscal stimulus worldwide gave hope of a revival inthe commodities space. The government's pragmatic approach of saving lives and livelihoodsmeant that continuous process operations were allowed to operate and we went to greatlengths to protect our workforce while fulfilling our contractual commitments. After asteady H1 ferro chrome prices increased substantially enabling us to close the year on ahigh confident about our ability to navigate through difficult terrain.
The second wave drove home the point that nothing can be taken for granted butavailability of vaccines offers hope that life can get back to near normal by the end ofthe current year. The economy had staged a smart recovery after the first wave which willundoubtedly be impacted as evident from several high frequency indicators; however I amconfident that appropriate stimulus measures will provide relief as was the case last yeartoo. Meanwhile there is talk of a commodities 'super cycle' driven by stimulus on tap andlow interest rates which are the preferred tools of policy makers. This augurs well forthe steel industry and by definition the ferro chrome industry. IMFA is of courseuniquely positioned to benefit from an uptick in global economic activity.
Getting our act together
Operating in the midst of a pandemic meant going to great lengths to protect ourworkforce while moving as much of our review and administrative functions as possible tovirtual mode. We have an innate advantage of our critical raw materials being captivelysourced but logistics was initially challenging which then gradually settled down.Meticulous planning went into keeping track of all aspects of our operations howeverminor and teams coordinated seamlessly despite working from home. Most importantlyofftake of finished product was never an issue for us given our long standingrelationships with large buyers. In fact if anything our ability to deliver despitechallenging circumstances has helped cement our reputation as a reliable partner.
We had expected ferro chrome prices to pick up in the first quarter itself as there wassubstantial cutback in output worldwide but it came later in the year. If an export dutyon South African chrome ore comes through as expected then we can expect furtherimprovement in ferro chrome pricing. In India too aggressive bids during mining auctionshave driven up raw material costs and the stretched balance sheets of some competitorscould not withstand the pandemic shock. As India's leading producer of ferro chrome weare well poised going ahead to garner a larger share.
Our proposed expansion in Kalinga Nagar Jajpur (Odisha) was approved by the StateGovernment in November 2019. While it is temporarily on the backburner we intend to moveahead with conviction to expand our capacity and cater to growing demand for ferro chromeby effectively utilising mineral resources available through captive mines. A healthybalance sheet with gearing gives us the confidence to do so without taking on undue risk.
Focussing on our team
Ensuring the safety of our people was our topmost priority and their wellbeing remainsour core focus. During the year employees in allied functions transitioned to workingfrom home but core manufacturing and mining activity cannot be done virtually. Weinstituted stringent safety protocols and went to great lengths to ensure the safety ofour workforce. We were quick off the block when vaccines became available and in a showof our commitment to our people are committed to vaccinating not just our employees -permanent and contractual - but also their spouses and eligible dependents.
Learning & Development activities moved online and in fact we were perhaps ableto be more effective as it became easier to engage outside resources. Besides work relatedprogrammes our focus during this period has been on personal wellbeing and stressmanagement. We will continue to invest in our people as they are the greatest resourceavailable to us and are committed to making IMFA a preferred workplace in our industry.
I am grateful to our dedicated workforce whose commitment not only gives me strengthbut also make the journey both rewarding and fulfilling.
Supporting the community
We have always been supportive of the community of which we are a part. Despiteoperating under challenging circumstances we continued to implement various initiativesthrough the Bansidhar & Ila Panda Foundation (BIPF). From supporting the communityright through the pandemic to disseminating safety protocols and assisting frontlinerelief workers BIPF played a pivotal role. We have also allocated funds to variousinfrastructure projects which will be of use to the local communities in which we operate.
Going forward we believe governments across the world will focus more oninfrastructure expenditure. India has enhanced its budgetary allocation in this regard forFY22 while the US has unveiled an ambitious plan to overhaul its legacy infrastructure.These developments augur well for us and we are alert to any opportunities which willcome our way.
In conclusion I assure you of our best efforts to deliver superior performance thanour peers while keeping the best interests of stakeholders foremost at all times.
|Take care & stay safe! |
|Subhrakant Panda |
|Managing Director |