The year 2012 witnessed a laggard growth in the economy which however ended withimprovement on a modest note in synchronization with the global scenario. In a globalizedeconomy, there is no escape for any country from the consequences, be it positive ornegative. Barring no exception, over the decades, India has also firmly integrated withthe world economy. The very fact remains that policy uncertainty and slowdown in theglobal demand has hampered the overall growth of all economies with major injury bearersbeing growing economies like India. It has been generally difficult for the companies thathave their major revenues coming from exports markets as reasons like slowdown in demand,currency fluctuations and recovery of receivables have a key role to play.
Sensing the above situation, as some of it was a spillover of the previous year aswell, we as a company had the target of maintaining and improving operational efficienciesin tandem with trying our best on the working capital management. We also worked on theproduct profile enhancement along-with retaining the market share in differentgeographies.
One of the key issues to be addressed during the year was the refinancing of the FCCBsthat matured in October 2012. This needed prime attention as the currency fluctuationsplayed a spoilt sport. Also with the economy jitters being felt globally, refinancing atexorbitantly high interest rates way beyond the comfort zone of even the biggies in theindustry, was a huge challenge. We had been taking adequate measures to stop the viciouscircle of excess debt leading to disaster by executing strategic program of structuredfunding having combination of low-cost long-term debt and equity. We did manage to tie upfor long term funding proposals to restructure the bonds. Lot of efforts are underway fornegotiating with the bondholders, betting on the fact that the macro environment wasdifficult to handle.
Although the emerging and developing markets are not expected to rebound to the highgrowth rates of 2010-11, as indicated by the IMF survey, it is still projected to clockdecent growth in 2013. This is however keeping in mind that weakness in the advancedeconomies will reflect on the performance of the developing economies impacted by theexternal demand. The increasing level of intense competition, complexity and mountinguncertainty leads to a challenging environment and needs to be handled strategically asthe level of uncertainty is expected to remain high and keep increasing in the comingyears.
We have been working on strategies that enable us to anticipate competitor's actionsbeforehand, consider innovative pricing options, engage and connect with stakeholders andcollect and analyze real-time data helping to quickly grasp changes in the market placesand to formulate business plans more aptly. This is based on the realization that theenvironment is getting complex and traditional guidelines are no longer applicable.
In this challenging environment, we at Plethico have still managed to maintain ourperformance with regards to product innovation and capturing newer clients and marketswhile serving the existing ones. We have geared-up our core executive team for thepossibility that there could be another downturn or slowdown in the coming years and assuch to improve competitive strengths permanently.
Foreseen the fact, that innovation is the only key to sustain and rebound, we had beenlaying emphasis on our R&D activities and in-process innovations. Keeping in mind thatpricing would be the core pillar of any product profile development; we have optimized ourprocesses and applied innovation pricing strategies. The company also developed a verycompetent management team and an effective information system suitable to theorganization's needs. Comprehensive reporting system has also been developed that tracksKPIs in real-time, enabling to quickly understand the changes happening in the marketsglobally and thus modifying strategies to achieve the expected growth levels.
Our focus during the year 2012 was bifurcated on one hand into financial aspects thatwould help us cap our liabilities in order to strengthen our balance sheets and havestable cash flows while on the other hand business development that focused ondifferentiation, accelerating product development to the optimum level, creating tangiblevalues for customers, identifying core activities, applying game-changing strategies,creating new business models and pursuing opportunistic investments.
As a company we are well positioned to capture the demand growth of the emergingmarkets; however turnaround in the overall macro environment is the key. Although there isa gradual improvement being witnessed, sustainability and growth would still be achallenge.
I maintain my motive and promise to all the shareholders to give better returns throughrobust performance appreciating intrinsic value of the investment of the shareholders. Ialso express my sincere gratitude to all my stakeholders who have reposed trust in us andextended their full co-operation. I am also grateful to the Board of Directors for theirsteady support and guidance.
Chairman & Managing Director