MR. EdWARd MENEZES
PROMOTER & ExECUTIvE CHAIRMAN
It gives me immense pleasure to present our first annual report as a publicly listedorganisation.
At the onset I would like to take this opportunity to thank all the investors fortheir whole-hearted response to our Initial Public Offer which comprised a fresh issue of1176470 equity shares and an Offer for Sale of 10500000 equity shares includinganchor portion of 3502940 equity shares. Rossari raised Rs. 1000 million throughpre-placement of shares with institutional investors in February 2020. Further theCompany raised
Rs. 500 million through the issue of fresh equity in July 2020. We have utilised theproceeds from this issue towards funding our working capital requirements prepayment ofloans and for general corporate purposes. I am happy to share that post our Initial PublicOffer Rossari is now a debt-free Company. Post our public listing we have embarked upona new phase in our journey and are very excited about the business and growth prospectsgoing forward.
Established in the year 2003 Rossari is one of the leading specialty chemicalsmanufacturing companies in India providing intelligent and sustainable solutions tocustomers across industries such as FMCG Home and Personal Care Industrial
Cleaning Textile specialty chemicals Performance Chemicals Animal Health andNutrition and Pet Care businesses. Over the last two decades the Company has developed adifferentiated and tailor-made product portfolio for its three main businesses of HomePersonal Care and Performance chemicals (HPPC) Textile specialty Chemicals (TSC) andAnimal Health and Nutrition (AHN). The Companys differentiated solutions are centredon four pillars of chemistries namely enzymes silicones acrylic and surfactants.
Being solution providers Rossaris offerings contribute significantly to theproduct experience and enhance utility for our vast customer base of 1000+ customersincluding MNCs domestic and local companies. Most of our product portfolio isenvironmental-friendly in nature and undergoes sustainable manufacturing processes. Todaythe Company operates from two strategically located manufacturing facilities at Silvassaand dahej Gujarat with a total production capacity of 252500 MTPA. Both thesefacilities are highly automated with flexible and fungible capacities across threebusiness lines of HPPC TSC and AHN. This enables us to manufacture any of product linewithin the four core chemistries at any point of time. Our plants arezero-liquid-discharge facilities minimising carbon footprint of our manufacturingprocesses.
A combination of intelligent chemistry and R&d since inception has always held aposition of prominence for Rossari. Our Company operates two R&d facilities atSilvassa and Mumbai. The R&d capabilities integrate all the three aspects of ourproducts synthesis research formulation and development and technical service toprovide customisable intelligent and cost-efficient solutions to customers in a shortertime frame. Based on our intelligent chemistry knowhow our R&d Team is relentlesslyworking to enhance existing product offerings. In-sync with this our R&d team isconstantly assessing various available and new opportunities to introduce product nicheswith a strong push towards sustainability and environment-friendliness.
We pursue this initiative by way of our business processes manufacturing capabilitiesand product development. Rossari is one of the frontrunners and specialists in India forproducing environmentally benign substitutes that replace legacy and harmful productsthereby minimising carbon footprint. Our teams have been constantly focusing towardsdeveloping green sustainable and cost-neutral products that accelerate growth andmaximise customer benefits.
With deep customer engagements across industries Rossari is essentially acustomer-centric company providing tailor-made solutions backed by the elements ofresearch agility sustainability and operational efficiency.
FY 2020-21 Resilient Performance
The fiscal a tough operating environment with the spread of the COVId-19 pandemicleading to multiple lockdowns across domestic markets.
This led to significant disruptions in production levels supply chain anddistribution operations. While we delivered strong performance in our HPPC business led byaccelerated momentum in hygiene products and anti-viral portfolio sales broader operatingconstraints and slowdown in demand impacted performance of our TSC and AHN businessesduring the first half of the fiscal.
As the country moved to the un-lockdown phase in H2 FY 2020-21 we started seeing ahealthy uptick in consumption and demand which further strengthened through the course ofthe fiscal. Overall we have reported a resilient performance in FY 2020-21 with revenuesfrom operations at Rs. 7093 million up 18.2% year-on-year. Revenues from HPPC stood atRs. 3989 million contributing to 56.2% of revenue followed by TSC business at Rs. 2521million contributing to 35.6% and AHN at Rs. 583 million contributing 8.2% of totalrevenues. On the profitability front EBITDA stood at Rs. 1230 million with margins at17%. PAT during the year stood at Rs. 800 million as against Rs. 652 million in FY2019-20.
From a balance sheet perspective cash and bank balances during the fiscal stood atRs.1078 million. Net cash flows from operating activities during the year stood healthy atRs. 478 million. The Company utilised the Initial Public Offer proceeds towards fundingits working capital requirements prepayment of loans and for general corporate purposes.
On the whole the Company has a dominant financial standing. Over the longer term wewill pursue all our defined strategic initiatives while always maintaining a strongfinancial discipline.
Message to Shareholders
We look forward to your continuing support in our journey which we believe will createsustainable value for decades to come. We remain optimistic about our future prospectsgiven the huge potential of our diversified product portfolio fungible and agilemanufacturing establishments and the ability to constantly innovate and launchdiversified products for our customers. Rossari is well-poised to capitalise on theenormous growth potential of all the three key sectors it is present in HPPC TSCand AHN. All these three businesses are strong growth drivers for us and the outlook foreach business remains positive in the medium-to-longer term.
Additionally I am happy to share that the Board of directors approved two strategicacquisitions. In June 2021 the Company acquired Unitop Chemicals Private Ltd to expandoperations into untapped and promising categories within the specialty chemicals space.Unitop Chemicals is a leading supplier of Surfactants Emulsifiers and specialty chemicalsto a diversified customer base including large domestic and international companies. Theacquisition of Unitop Chemicals is a natural fit within our operations and brings with itimmense synergies and complementary growth dimensions. This is a very strategic andvalue-accretive opportunity for Rossari and we are excited to drive faster growthtogether with larger revenues greater technological capabilities stronger spread ofmarket presence and well-aligned operating segments.
Further the acquisition of Tristar Intermediates in July 2021 brings together twohigh-potential companies within the specialty chemical space. The blend of capabilitieswill add scale provide cross-selling opportunities and accelerate growth for Rossariwhile significantly enhancing value creation in the longer term. The synergisticacquisition provides Rossari with enhanced portfolio of products stronger presence in newand untapped international markets and access to newer technologies.
Rossari plans to fund the investments through cash on balance sheet and doesntintend to raise any debt for these acquisitions.
Iwould like to take this opportunity to thank our shareholders valued customers andbusiness associates for their continuing trust and support in us. I would also like tothank our employees for their whole-hearted support and dedication.
I would like to express my sincere gratitude to all the members of our Board for theircontinued insights and invaluable guidance as we explore new opportunities and move aheadwith confidence.
Mr. Edward Menezes
Promoter & Executive Chairman