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Kapston Services Ltd.

BSE: 535064 Sector: Others
NSE: KAPSTON ISIN Code: INE542Z01010
BSE 05:30 | 01 Jan Kapston Services Ltd
NSE 00:00 | 12 Aug 149.05 -1.50
(-1.00%)
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Kapston Services Ltd. (KAPSTON) - Chairman Speech

Company chairman speech

Dear Shareholders

I hope this letter finds you in good health. The covid-19 pandemic dealt a body blow tothe Indian economy. The government's aggressive vaccination program is helping check thepandemic's worst effects. Most of the country's population is expected to be vaccinated bythe end of this year. Businesses are finally starting to look to the future with hope andoptimism.

Kapston has weathered the pandemic with remarkable resilience. Our investments infuture growth over the years and our strategic forays into new areas enabled us to meetour growth targets for FY 20-21. At a company level we take a disciplined portfolio viewto optimizing our revenue mix. This ensures our participation in the right opportunitiesand our continued relevance in the marketplace.

I am proud of the collective achievements of thousands of Kapston employees who put intheir best efforts during a difficult time. I wanted to take this opportunity to presentsome of our achievements during the year interlaced with my honest assessment of the keytrends that are shaping the future of the economy- and therefore the future of Kaptson.

The macro picture

The International Monetary Fund (IMF) has forecasted a growth of 9.5% for the Indianeconomy. Whether the country will meet this ambitious target will depend on the strengthand speed of the government's policy response. Several structural factors require urgentattention. As with any crisis we hope the pandemic creates the necessary politicalcapital to pull ahead with reforms. Multiple stimulus programs launched by the governmentbesides clear-headed fiscal and monetary policies ensured that there was enough liquidityin the market inflation remained in check and infrastructure spending continued apace.

A year of resilience

The Facility Management Services industry with its various sub segments was among thesectors most impacted by the pandemic. With several commercial properties such as officesand malls shut for most of the year the demand and need for housekeeping and office helpwas lower during the year. At Kapston we had to deliver against twin mandates: protectingthe health of our people and their families and maintaining our revenue and profitperformance by serving our clients with distinction. I am delighted to share that we didwell on both these goals. Our annual revenues for FY21 held steady when compared to theprevious fiscal.

Gearing up for growth

We offset the negative impact of the pandemic on our revenues by growing in newerservice lines such as staffing services with a significant increase in security servicesrevenues. Our operational resilience comes from our diversified portfolio of offerings andour innovative approach to adding new verticals. Our new staffing vertical has a brightteam of HR professionals with experience in diverse areas of staffing services such astalent acquisition training HR auditing and payroll management.

The immediate traction this vertical experienced among corporates mid-sized companiesand government organizations enabled us to generate Rs. 500 lakhs in revenues in FY21.

Being a good corporate citizen

A holistic focus on governance people and social responsibility is deeply embedded inour business model. Towards fulfilling our social responsibilities we contributed Rs.27lakhs to help governments combat Covid-19 (PM Relief Fund and CM Relief Fund-Telangana)fund Swacch Bharat initiatives and for the promotion of digital education.

The road ahead

On balance we believe the future of the Facilities Management Services is positivewith most companies shifting to a hybrid operating model with some employees working fromthe office and some from home. Given that productivity is on the wane in a remote workingenvironment we expect leaders to implement plans throughout the fiscal to bring peopleback to work. The sector is estimated to clock high double-digit CACR over the next fewyears.

Kapston is one of the fastest growing integrated facilities management companies and wewill continue to channel our efforts to ensure that we establish pole positions in theareas in which we operate. We moved into a new corporate office in 2020 and opened severalnew branches in 2021.

This is an optimistic time for us at Kapston and we look forward to further improvingour performance in FY22.

I would like to thank all our employees contractors vendors suppliers stakeholdersand investors for their faith in us. We promise to deliver on our commitments throughoutthe current fiscal. We hope that you and your families remain safe.

Regards

Dr. Chereddi Ramachandra Naidu

Executive Chairman.

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