In most aspects FY 2016-17 was one of the most challenging years for the Oil and Gasindustry. However at Indraprastha Gas Limited (IGL) it was a year that provided us witha platform to demonstrate our core capabilities backed by our proven track record andvalue- creation methodologies. Our operational competitiveness and business strategiesenabled us to respond to the changing market scenario. As a result we retained the trustof our investors and maintained a resilient financial position.
The global economic growth continued to face headwinds reporting weak growth numbersfor 2016. The crude oil prices remained under pressure with increase in supply from the USand Middle East beyond the expectations of the markets. Coupled with this government haslaid emphasis on better fuel pricing reforms and placed impetus on alternate and greenerfuel energy which has only fuelled further growth opportunities for us in this sector.
The past one year witnessed two events in the country's economic history. One wasdemonetization that resulted in withdrawal of legal tender of high value currency notesand the second being implementation of GST which has brought the country under a new taxregime to bring in greater transparency.
Your Company's focus on stronger operational performance and higher profitabilitycontinues unabated. Despite a marginal increase in the gross turnover we were able toincrease our net profit by 36.28% on a year-to-year basis. The pressure on pricing forCompressed Natural Gas (CNG) and Piped Natural Gas (PNG) on account of reduced inputcost caused the revenues to be flat. In numerical terms we clocked Rs.4205.43 Crores ofrevenue in 2016-17 (against Rs.4052.14 Crores in 2015-16) and registered a net profit ofRs.571.07 Crores (against Rs.419.05 Crores in the previous year). Against this strongoperational performance your Board has recommended final dividend of 50% in addition tointerim dividend of 35% for the year 2016-17.
The major highlight for the year was our endeavor towards expanding CNG business of theCompany. The Company started its operation in a new geographical area of Rewari inHaryana. We also successfully piloted the project of CNG based two wheelers which waslaunched by the Hon'ble Minister of State I/C (P&NG) and appreciated by ourstakeholders. This being a novel concept we expect growth and revenues to increase fromthis segment in the long run.
On the core business front we continued our steady network expansion. We expanded ourCNG infrastructure with commissioning of 81 new CNG stations (including the 78 stations atretail outlets of Oil Marketing Companies). This has taken our total installed compressioncapacity to 71 Lakhs kg/ day as on March 31 2017. We recorded our best performance tilldate for the PNG segment providing more than 1.05 lacs new domestic PNG connections inthe year ending 31st March 2017. We also gained in industrial and commercial segments forPNG adding customers in the industrial belts of Noida Greater Noida Delhi andGhaziabad. We expanded our steel pipeline network to 778 kms (from 707 kms in 2015-16) andMDPE network to 9940 kms (from 9443 kms in 2015-16) during the year 2016-17. It isheartening to see that our investments in associate companies are bearing fruit and I amconfident that our widespread network and innovative marketing will further widen ourmarket presence.
The execution of our strategies resulting in a balanced business approach would nothave been possible without the commitment of our team. We continue to invest in nurturingtheir skills through various training and development programmes. Their talent anddetermination has positioned us to continue to deliver value for our stakeholders.
Health and safety of our employees and customers constitute a critical aspect of ourbusiness sustainability. Safety inspections of CNG vehicles are done periodically onrandom basis to ensure compliance of safety standards. A detailed HSE Policy and regularsafety audits ensure compliance of all safety rules and regulations. As a result wecrossed 106
Million Man Hours of accident free activity as on March 31 2017 and were conferredwith the Safety Innovation Award by Institute of Engineers and Certificate of Appreciationfrom National Safety Council for 2016-17.
Engaging better with customers
The evolving landscape for City Gas Distribution (CGD) requires us to address consumerrequirements with ease and convenience. A growing consumer base across all our consumersegments makes it imperative for us to focus on Information Technology. With focus on ITour technology- led services have helped us to provide better services to our customers.The launch of 'IGL Connect' (mobile friendly app) and 'INSTAPAYMENT' (for facilitatingonline payment) has helped our customers to connect and engage better with us.
At IGL we have always believed in ensuring growth and development for a widerstakeholder community. We undertook several initiatives for empowering people in the fieldof education healthcare skill development and women empowerment. Initiatives like 'IGLSwasth Sarthi' and 'IGL Suraksha Yojna' have empowered the Driver community to a greatextent. Our efforts towards sustainable development have got us recognition by way ofvarious CSR awards.
We stand at the threshold of an era of change and constant evolution for cleanerenergy. There has been a growing concern on the pollution levels in Delhi and NCR towardswhich judicial and other Statutory Authorities have intervened. We continue to expand ouroperations in new geographical areas and strengthen our market presence in existing areas.We expect our entry into Gurugram Haryana to be another game-changer and drive businessgrowth across our business segments. Today IGL is well positioned to continue to executeits defined plans and deliver significant and sustainable value for years to come.
On behalf of the Board of Directors I take this opportunity to thank the Government ofIndia Petroleum and Natural Gas Regulatory Board and all departments of the Central andState governments our valued Customers all the authorities and agencies for theirunstinted support to your Company.
I along with my colleagues on the Board would also like to thank each and everyemployee of IGL for all the hard work put in by them.
Finally I would like to thank each one of you from IGL's family of Shareowners forthe confidence and trust reposed in us. With your support and blessings I am confidentthat we shall continue to strive to deliver long-term value in the coming years.