WE DO THE RIGHT THING; WE ALSO DO THE THING RIGHT.
What I wish to say to you here takes off from a quote by thefounder of modern management' Peter F. Drucker - "Doing the right thingis more important than doing the thing right. Well we at Ratnamani value boththings equally. I believe some explanation is in order as far as the quote is concerned.What Drucker hinted at was the difference between Effectiveness (doing the right thing)and efficiency (doing the thing right).
In the context of Ratnamani our business model demands that we do theright things every time since we always make to order. However we also ensure that we dothese all at the highest level of the efficiency possible. I believe the reason we arethriving is that our organization is characterised by both High efficiency and HighEffectiveness.
We are both Resource-oriented (efficiency mind-set) as well asGoal-oriented (Effectiveness mind-set). We make optimum use of our available resourcesmen money material and machine; we also have a clear breakdown of goals at the companydepartmental and individual levels. Yes we are yield or quantity driven but we are alsoresult or quality focused. Our short-term perspective enables us to focus on strategyimplementation or operations while our long-term perspective dictates strategyformulation. In cricketing terms we have a sharp focus on the next ball the next overand so on; we also have an overall game plan with contingencies or Plan B built in.
Again in sporting terms as someone said the trophy is earnedin the hours that nobody is watching.' Our values of hard work dedication andinnovation are invisible but these have a visible influence on our results.
The hallmark of our performance is that we are a Symbol Standard andSeal. First and foremost we are a Symbol of value: over the years we have built a legacythat represents value to all stakeholders. This has happened because we have beenconsistent in upholding a Standard of the highest order be it product delivery orservice. Something that is consistently good is bound to get noticed. Our product rangehas the Seal of approval in the market.
Do we expect such performance to continue? Without a doubt yes. Thebiggest reason is that our performance stems from our robust values. So even duringdownturns if any you can be sure of us beating the industry average. However as amatter of fact there doesn't seem to be any downturn around the corner at least notin India. The world as a whole is doing worse than anticipated but India is still goingto be a pocket of high growth. The country will largely rely on a buoyant domestic economypowered by rising aspirations huge infrastructure spends and pro-market scal and monetarypolicies.
There is so much high visibility in our areas of interest that weforesee good business in coming years. Our reputation in the industry as a superiorsupplier will stand us in good stead allowing us to reap the benefits of emergingopportunities. We are preferred suppliers for many Fortune 500 companies and IndianNavratnas. Our own supply side is also favourable. The domestic steel industry has grownon the back of abundant iron ore availability cost-effective labour and introduction ofNational Steel Policy 2017 among others.
On the international front the lion's share of demand for steel pipesis expected to originate in the Gulf countries Asia and USA. India's competitiveadvantages in pricing quality and location makes it a preferred exporter to countrieslike US Europe South East Asia the Middle East and Africa. Since Ratnamani has theadvantage of brand salience and recognition in the market we anticipate a good chunk ofthat business coming our way down the line.
Quality and Price have helped us in establishing ourselves as a leadingsteel pipes and tubes manufacturer in India. This has also helped us to establishourselves as a quality manufacturer of pipes and tubes in the discerning internationalmarkets. We believe the Oil and Gas sector will continue to be a good opportunity for us.Rising oil and gas consumption has been ratcheting up the demand for oil and gasproduction and transportation. This in turn means the prospect of higher demand for ourpipes and tubes. With the fourth largest re ning capacity in the world our country iswell on its way to becoming a global re ning hub. Increase in present re ning capacitiesand new grass-root re neries are going to add to the demand for our products. BesidesIndia a large number of green field and brown field refineries and petrochemical plantsare coming up in Singapore Middle East and the African region are going to be goodopportunities for us. The market is also moving towards higher grade steel alloy pipes andtubes. We are well-placed to tap the upcoming opportunities and move up the value chain.LNG Terminals springing up in India and elsewhere in the world is a scenario we relishsince such terminals tend to use a lot of steel pipes and tubes in their construction. Wesee line pipe opportunities opening up in oil and gas transmission and City GasDistribution (CGD). City gas distribution in particular has received a huge llip from thegovernment which intends to develop a gas-based economy by the year 2040 and has set inmotion the 10th CGD Licensing Round recently. Other sectors with a continuing upside forus would be Power Thermal Nuclear and Solar Fertilizer Plants Atomic Energy Aerospaceand Water.
The ongoing financial year will see us getting into an exclusive leagueof international producers with our Hot Extrusion Press - capable of making seamlessproducts in stainless steel and nickel alloys of up to 10 NPS size- going on stream.The current demand for such sizes are met through imports which are generally costly andsubject to the vagaries of foreign exchange rates. Our unique capacity the first of itskind in the country will unleash domestic demand for our products throughimport-substitution thus saving precious foreign exchange. We also expect substantialforeign interest and orders arising from such an augmentation. This year expansion plansalso include an increase in L-SAW capacity to grab an ever-increasing slice of theopportunities.
We believe results are temporary performance is permanent. If wecontinue to perform like the way we have been doing I am sure we will set the goldstandard for performance in the industry and shine brighter than ever before.
Prakash M Sanghvi
Chairman and Managing Director