The past 18 months have been like no other in living memory and the entire world hasfaced extraordinary challenges during this period. I wish and pray for the safety andwell-being of your loved ones and take strength from the knowledge that we collectivelystood strong in the face of the pandemic exhibiting resilience determination andcompassion for each other. The Financial Year 2020-2021 also witnessed a lot of unexpectedsituations and circumstances caused by the Covid-19 pandemic which affected businessesacross the world and the way it is conducted as well as the way we live our day to daylives.
While we dealt with overwhelming situations and hardships the company took extraprecautions to protect and preserve the health and safety of its employees and workers.While this helped in running the business to near normalcy after the initial lockdown italso strongly reinforced the concept of a family the PTC Parivaar-which stood with eachother during this time of crisis and offered support strength and hope to all itsmembers. This time also offered an opportunity to PTC to focus on re-imagining ourpurpose experimenting with new ideas and concepts and building our resources processestechnologies infrastructure people and product lines. Our vision statement motivates usto be the number one choice in the markets we serve and as a proud Indian company we alsofelt that our prime purpose is to bring technologies infrastructure and capabilities toour country which allow us as a nation to be at par with the world. Whether it was in thesphere of the possibilities that we could create in the metal component manufacturingcapabilities within the country whether it was in being able to set or exceed thebenchmarks of quality or integrity that were demanded by the most super-criticalapplications in the world or whether it was in the development of skills and talent thatcompared with the best manpower and people across the globe-the idea at PTC was clear. Ourpurpose is to work towards achieving 'Parity' with the rest of the world.
At PTC we are engineered to always think about our customer about society and aboutcreating a positive impact on all our stakeholders. When we began to think about using ourcapabilities to create a positive impact on the nation we inevitably began to think aboutthe possibilities that exist to unleash an innate potential within the country. And it isthis potential that makes opportunities for our nation limitless. And for this the firststep is to attain 'Parity.
At PTC 'Parity has become a key mantra. It covers the epitome of the vision of theCompany and our commitment to the country in the foreseeable future. It is important forthe Company as it enables us to benchmark ourselves against global players. It isimportant for the country because it brings with it a promise of a level playing field interms of capability technology and infrastructure - a truly Aatman- irbhar Bharat. We areworking on several projects ranging from advanced manufacturing to digitization and 3Dprinting and many more to keep pace with a fast-changing world to attract and developthe best talent and to provide the best solutions and service to our customers. This isnot just an external change but an internal transformation in the way we conductbusiness with our customers and vendors as well as our employees our investors and youour shareholders. With one focus and objective in placeto achieve parity and be atpar with the rest in the world lay the foundation of a sustainable ecosystem and sow theseeds for a positive future in accordance with our nation's vision of becoming'Atmanirbhar'.
Let's review our performance during this period:
Our EBIDTA increased by 13% to Rs 40 Crs in 2020-21 in spite of a dip inrevenues this year to Rs 163 Crs
The Financial year 2020-2021 started with nationwide lockdowns to control the spread ofthe Covid-19 pandemic due to which the operations of the Company were suspended from 22ndMarch 2020 for a period of about 50 days. Thereafter operations of manufacturing plantsstarted in phases by following the COVID-19 Guidelines issued by the Governmentauthorities and local administration from time to time. Hence the revenues of the year2020-21actually correspond to approximately a 10-month operation period as this unforeseenlockdown accounted for operations being shut down for almost 2 months in April and May2020. Thereafter we witnessed a slow ramp up from lockdown to increasing production andbringing operations to near normal in the months that ensued.
Our working capital ratio was 1.11 preserving our sustainability across theforeseeable future.
EPS (earnings per share) number declined due to the company opting for the newregime of Income Tax and thereby surrendering the MAT credit entitlement amount of Rs.9.57 Cr as at the end of the year. Hence EPS dipped to Rs 8.37 compared to Rs 20.05 lastyear.
The real Gross Domestic Product (GDP) growth in India is projected to contract by 7.7percent in 2020-21 as compared to a growth of 4.2 percent in 2019-20. GDP growth howeveris expected to rebound strongly in 2021-22 owing to the reform measures undertaken by theGovernment.
Global aerospace and defence (A&D) industry revenue is expected to begin to recoverin 2021 after a difficult year in 2020. But this recovery will likely be uneven across thetwo key sectors commercial aerospace and defence. The commercial aerospace sector hasbeen significantly affected by the COVID-19 pandemic which has led to a dramaticreduction in passenger traffic in turn affecting aircraft demand. As a result thecommercial aerospace sector is expected to recover slowly as travel demand is notexpected to return to pre-COVID-19 levels before 2024. The defence sector is expected toremain stable in 2021 as most countries have not significantly reduced defence budgetsand remain committed to sustaining their military capabilities. However given thedisruption in the complex global supply chain some defence programs could face minor costincreases and schedule delays in 2021.
In 2021 defence budgets and revenues for defence contractors are expected to remainlargely stable as military programs continue to be critical to national defenceespecially considering geopolitical tensions.Global defence spending is expected to growabout 2.8% in 2021 crossing the $2 trillion mark. Countries across the globe continue tospend on strengthening their militaries as geopolitical tensions intensify despite theglobal pandemic.
The Indian military aerospace and defence industry has seen a slew of policy decisionsbeing taken and implemented during the Covid era. From increasing the automatic routelimit for foreign investment in the sector to imposing a ban on import of various defenceitems it is clear that the Government is focused on the growth and development of thesector. On May 12 2020 in a bold clarion call to the nation the Prime Ministerannounced the idea of a self-reliant India with a specific focus on our self-reliance inthe Aerospace and Defence sector. The announcements show that a multi-pronged approach isbeing adopted not only to reduce India's dependence on imports but also to increase ourexports. The Government has been cognisant of the fact that as of today India still needsto rely on global imports for high-end technologies and that foreign OEMs have animportant role to play in the growth and development of the sector in India. To this endannouncements have been made to incentivise FDI and transfer of technology. At the sametime the Government has formulated a progressive plan for Indian corporates to achievecertain levels of sophistication over the coming years including through tie-ups withOEMs which would result in a corresponding reduction in reliance on imports.
In view of these strides within the sector our guiding principle is to become anenabler in achieving Parity parity of technology opportunity defencesustainability wealth creation and improving livelihood for all. This concept of Paritymust become a part of the DNA of this company and the essence of everything that we haveset out to achieve. Hence we are endeavouring to undertake initiatives to achieve parityin metal and metal component manufacturing capabilities identifying missing links andgaps to plug opportunities where we may alleviate imports and overall seek to bringtogether and develop all such required core manufacturing capabilities within India forthe current and future needs of all Industrial Aerospace and Defence equipment systemsand platforms.
A pertinent question on reading this dear shareholder may be to ask "How?"Let me explain.
For the past few years the Company has been developing technologies processes andproducts for Aerospace and Defence applications and made substantial investments inresearch and development in this area. Production and process trials were being conductedto develop high integrity products for a variety of applications for use in Land Sea andAir platforms. This investment of time money and other resources has been designed toenable the company to extend its capabilities beyond making parts only for industrialapplications and widen its scope and markets into this new sunrise industry in India.
The main approach to creating parity of technology is to identify which core technologyto imbibe. This sows the seed of creating an addressable opportunity in the market andcreate pockets of import substitution. This has aided companies and countries tomanufacture components that were earlier not possible in that country or territory. Bymanufacturing the missing link in the value chain PTC has been able to create a newopportunity for the development and commercialization of the RapidCast technologyfor the manufacture of castings upto 6000 kilograms in weight single piece for a hugeambit of critical components.
This has been possible by re-engineering processes and controlling input material andother parameters of manufacture.
Another pocket of opportunity that also leads to parity in the ecosystem was with thecommercialization of TiCast (Titanium castings with ceramic shelling) in the earlieryear. The commencement of Titanium Casting for the first time in the country brings Indiaat par with the world in indigenous manufacture of products with not only industrialapplications but also in defence aerospace and healthcare.
Our purpose is to work towards achieving 'Parity' with the rest of the world.
The development of technologies related to 3D printing withPrintCast have alsoevolved the scope of our capabilities and additive manufacturing using metal powders hasalso started to yield results. Simultaneously advanced manufacturing technologies forproduction of all metal components for Water Jet engines for naval ships and frigates andPropellers for ships and submarines has been brought to the country. Besides making thecountry self-reliant this is also bringing in precious foreign exchange to the country aswe are also exporting this to all the major OEMs worldwide.
Our Advanced Manufacturing & Technology Centre has already become a symbol ofexcellence in core metal manufacturing. Besides bringing world class equipment andtechnology this plant also incorporates sustainable practices for ecologicalmanufacturing this being the first step to bringing our processes at par withsustainability standards globally. We have commissioned a green building with a rooftopsolar plant rainwater harvesting and effluent and waste treatment plants and investmentin fume extraction and exhaust systems.
Additionally we focused getting our human resource and skill pool at par with globalstandards. We have adopted the mentoring route to enhance efficiency and hone talent.Information technology has played a key role in developing online skilling resources totrain our workers as well as supervise at the shopfloor level and create effectivecommunication channels among senior and middle level management. People are our greatestasset and engaging and empowering them is our continuous objective. We have alreadycreated structures to delegate decision-making and ownership all the way down within theorganisation.
We have also developed an appraisal system for talent recognition and hiredinternational consultants for leadership training. The next challenge was to re-educateemployees for efficient decision-making and motivate them to achieve the objectives ofhigher productivity and efficiency. In this context we have begun the process ofcompanywide digitisation. Digitisation is now ubiquitous in all our human resourcepractices and there is a greater scope for digitisation to be used for efficientdecision-making from real-time information deeper understanding of data and greatertransparency. I am pleased to say that we are working towards achieving this.The Company'sstandards for quality safety training development health and environment have alwaysbeen maintained at the highest level. The Company has been employing the use of artificialintelligence data analytics and latest software to continuously upgrade and maintain itssafety and quality parameters.
In essence by streamlining our people and processes we're also bringing parity in ourproduct quality and value thereby benchmarking it with global standards.
Our road ahead is challenging but PTC's potential and future outlook is extremelyoptimistic. We have myriad and diverse innovations and technologies in the pipeline. Wehope to bring to the country the technology for Titanium ingots and billet manufacturingand develop unexplored yet versatile technologies in the near future. By expanding oursales network with presence in the United Kingdom France and the United States ofAmerica we are also now eyeing Germany and Japan to grow our global footprint.
We have been consistent in creating stakeholder value and built enduring relationships.We hope and believe that this commitment will guide us into a strong and bright futureand the benefits of our efforts will reach all our stakeholders our communities ourpeople and our nation.
I would like to express my sincere gratitude to all members of Board of Directors ourcustomers suppliers associates financial institutions banks and the employees of PTCand express our deepest appreciation to all the shareholders for their full support andunderstanding. PTC is growing and poised for a big leap forward as we remain optimisticand committed to India's growth story. We believe that India continues to be one of thekey growth engines of the global economy in the coming years on the basis of its strongfundamentals. We look forward to your consistent support in the times to come to step intothe future with even more determination confidence and promise.
Chairman & Managing Director.