It is my honour and privilege to interact with you as the Chairman of the Board. FY2019 which was our 15th year of operations has been an exciting one and an important step in our growth journey. Incorporated in 2009 we have evolved into a leading snack food company with a pan-India presence selling over 11 million packets a day. We are one of the leading players in the Rs 55000 crore packaged snacks market in India with an appetite for robust growth.
India's economy grew by 6.8% during FY2019 continuing on its robust growth trajectory as the fastest growing major economy. The nation has been ranked 77 out of 190 countries that are included on the World Bank's Ease of Doing Business Index for 2019. It is expected to overtake UK to become the world's third-largest economy and is poised to surpass Japan and feature at the second position in the Asia-Pacific region by 2025. The new government is working towards transforming it from a US3 trillion economy to a US5 trillion economy by 2025 lifting the country to the ranks of the world's upper middle-income countries.
With rising economic growth the size of the Indian consumer market is also forecast to increase from US1.9 trillion in 2019 to US3.6 trillion by 2025. Owing to urbanisation and growing income levels the snack market and the overall packaged food industry in India too has immense growth potential. The market for organised snacks is projected to grow by a CAGR of about 14.6% between 2016 and 2021. Affordability of products is important for growth in most categories in India due to the low per capita income level.
OUR PERFORMANCE IN FY2019
At Prataap Snacks we deliver value products that are either priced lower or offer more per pack. We have been able to build a strong business being ahead of the curve in creating the right taste in innovation and giving value to the customer. During the year under review we maintained a positive growth trend. We also grew our top line on the back of our improved distribution reach and new product launches.
The growing popularity of our snacks led to an annualised consolidated revenue to Rs.1170.6 crore up 15% from Rs.1036.7 crore. Our foray into Sweet Snacks segment has delivered positive results and the Avadh portfolio delivered healthy performance. Growth of the organic Yellow Diamond portfolio one of our products was muted as we faced challenges relating to increasing competition and capacity constraints.
Compression in the EBITDA margin was partly mitigated by measures to reduce costs rationalise trade margins and channel discount. PAT is marginally higher despite lower EBITDA and increased depreciation. Our net profit stood at Rs.44.6 crore compared to Rs.44.1 crore last year. Further our Board of Directors have recommended a final dividend of Rs.1 per share to reward our shareholders for their continued support.
ACQUISITION OF AVADH SNACKS
During the year we acquired 80% stake in Gujarat-based namkeen maker Avadh Snacks for Rs.148 crore involving a
combination of primary and secondary investments. Avadh has a strong presence in Gujarat and is now also expanding to adjacent markets. This has been a maiden acquisition in our history. We plan to take the portfolio of Avadh outside Gujarat by leveraging our distribution network and manufacturing capacity. Our product portfolios are complementary which will aid growth. And also the acquisition finally provides an entry into the lucrative Gujarat market currently dominated by regional players.
We are expecting synergy to benefit out of economies of scale and rationalisation of operational and distribution cost for the Gujarat region. Currently Avadh plant is being operated at almost 100% capacity utilisation and we are in the process of enhancing the capacity.
NEWER MARKETS AND INNOVATIVE STRATEGIES
We have been capturing new segments and categories every year. Starting with chips we entered extruded snacks and namkeen and we are now entering Yum Cake and Cookie Cake. We are convinced that the sweet snack category has a large potential which is currently not catered too. We will deepen our reach
in existing markets and focus on states like Gujarat U.P. and Punjab where we can meaningfully penetrate the market. We will continue to innovate our product portfolio and introduce new variants keeping in mind customer tastes and preferences.
We see rural demand picking up with a favourable monsoon. The lowering of edible oil import duty from 44% to 40% and a cool-off in crude oil prices will help improve our margins. Despite soaring prices of corn meal which contributed to higher food inflation we intend to maintain a positive trend in margins through appropriate measures. We also expect to garner a higher market share as more and more consumers shift from the unorganised to organised segment of the packaged snacks category in India. This coupled with our new launches and distribution expansion we have enough drivers to back our growth momentum.
APPETITE FOR GROWTH
Our appetite for growth is growing by the day - with a strong product platform multiple manufacturing facilities located in proximity to key markets proven consumer understanding innovative capabilities and a well-entrenched distribution network.
Our vision is to scale the company to greater heights within a decade with our four categories of snacks. We have a sure-shot and well-planned definite appetite for growth as we delve deeper into the sweet snack category and expand distribution into new geographies. We estimate growth to emerge from our geographical expansion new product introduction and the growing sweet snack category.
Moving ahead we remain focused on delivering deep value to our consumers through introduction of latest snacks at a variety of pack sizes with attractive prices. We will continue to build on our presence in the existing markets and also grow our presence in untapped states and sub-markets across the country. We also aim to take advantage of the macro-economic factors and trends in the Indian snacks market in the proposed new geographies.
I would also like to sincerely thank our customers and our shareholders for their support and confidence that has helped us create a strong foundation for our future plans.
Chairman and Executive Director