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Sarda Energy & Minerals Ltd.

BSE: 504614 Sector: Metals & Mining
NSE: SARDAEN ISIN Code: INE385C01013
BSE 00:00 | 28 Jun 826.90 12.95
(1.59%)
OPEN

803.60

HIGH

831.20

LOW

796.60

NSE 00:00 | 28 Jun 826.00 13.10
(1.61%)
OPEN

806.00

HIGH

829.90

LOW

799.00

OPEN 803.60
PREVIOUS CLOSE 813.95
VOLUME 4269
52-Week high 1358.10
52-Week low 615.00
P/E 4.52
Mkt Cap.(Rs cr) 2,981
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 803.60
CLOSE 813.95
VOLUME 4269
52-Week high 1358.10
52-Week low 615.00
P/E 4.52
Mkt Cap.(Rs cr) 2,981
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sarda Energy & Minerals Ltd. (SARDAEN) - Chairman Speech

Company chairman speech

Dear Shareholders

2020 was a year that cannot be forgotten so soon. We faced the worst ever globalpandemic that challenged the livelihoods of people. It took a tragic toll on people andcommunities while severely impacting businesses big and small. The word 'unprecedented'became a part of our daily conversation. Thanks to the untiring efforts exemplified bythousands of frontline workers first responders and medical professionals who battled thevirus and put up a brave fight to contain the virus even beyond their duty hours.

The new financial year started with the country still in different phases of lockdownowing to the second wave. At Sarda Energy our priority was to ensure that we navigatedour way through Covid-19 as securely and safely as we could. That meant not onlysafeguarding the financial wellbeing of the Company through the pandemic but also thewellbeing of people associated with us.

The macro-economic scenario

The Indian economy passed through one of the toughest phases in living memory. At thestart of 2020 our country was among the five largest global economies. Its economicgrowth rate was the fastest among major economies (save China). With the onset of pandemicin India in March 2020 the Indian Government announced one of the most stringentlockdowns in the world. As a result the public movement and the economic activity acrossthe nation came to a grinding halt. This lockdown had a devastating impact on analready-slowing economy as 1.38 Bn Indians were required to stay indoors. The GDPde-growth experienced by the country during the first quarter of FY 2020-21 was thehighest since the index was prepared. The gradual unlocking from June 2020 coupled withencouraging Government measures in the form of fiscal stimulus and promoting 'AtmanirbharBharat Abhiyaan' saw the country getting back on track. As a result sectors like realestate steel cement home building products and consumer durables among others reportedunprecedented growth. This sharp Indian recovery one of the most decisive among majoreconomies validated India's robust long-term consumption potential. The last quarter of2020-21 witnessed the more devastating second wave which once again halted the overallmomentum. The consolidated impact led to India's GDP contracting to 7.3% during 2020-21.

Our response

I am very proud of the resilience and adaptability shown by our teams as theydemonstrated a fantastic performance despite the underlying economic as well ashealth-related challenges. We continued to consolidate on our capacities throughdebottlenecking drive operational excellence and further strengthened our financialdiscipline. The result is visible in the overwhelming financial numbers we achieved duringthe year. We reported consolidated revenues of Rs 2199 Cr in 2020-21 as compared to Rs2000 cr in 2019-20. We achieved highest ever consolidated EBITDA and PAT of Rs 660 Cr andRs 376 Cr during the year respectively.

We continued to consolidate on our capacities through debottlenecking driveoperational excellence and further strengthened our financial discipline.

Backed by strong cash flows we rewarded our shareholders through highest ever proposeddividend payout of Rs 7.50 per share.

Key strategic developments

There were several developments during the year that have further strengthened ourfundamentals and positioned us to achieve a strong and sustainable medium to long-termgrowth. These include:

Pellet capacity expansion by 200000 MT: We successfully expanded the capacities andhave further received the 'Consent to Operate' for the enhanced capacity of Iron OrePellet Plant with immediate effect in March 2021. This would lead to increasing volumesand increase in revenues going ahead.

Vertical integration: We acquired two coal blocks in the recent coal mine auctionshaving extractable reserves of 13.4 MMT and 142 MMT respectively. These mines have bothhi-grade and low-grade coal and the activities related to commencing operations at thecoal mines are under way. It will further strengthen our integration capabilities and rawmaterial security. The excess produce beyond captive requirements will be traded thusadding an additional revenue stream for the Company.

Completion of 113 MW hydro power project at Sikkim:

The project achieved completion under adversities and challenges posed by pandemic andhas started commercial operations in June 2021. This would lead to generation of strongcash flows that will allow us to meet the debt obligations and enhance our EBIDTA levelsgoing ahead.

Improved/Increased cash flows: With additional cash generation from hydro powerprojects our free cash flow will improve further to fund future growth.

The way ahead

In the longer term for SEML as a whole we expect to continue to achieve improvingprofitability in our growth journey. We shall be further strengthening our growth bytaking advantage of our integration capabilities and strong cash flows. We are in a strongposition to take advantage of the opportunities ahead. Our priorities for building ourbusiness for the future are clear. We have the market headroom we have a focusedstrategy and we have the leadership team in place to deliver on our plans. Exceptionalmarket conditions and lessons learned from the pandemic have reaffirmed the opportunitiesin the market and we strongly believe that there are multiple levers for growth within ourcontrol.

Closing thoughts

At this time it is difficult to predict whether we will be able to hold our AGM inperson this year as the shades of pandemic still prevail. While we very much hope thatthis may be possible ultimately we will hold the meeting in the safest manner and incompliance with the government guidelines at the time. I remain confident in thesignificant long-term growth opportunities ahead and in our ability to execute ourstrategy in pursuit of sustainable growth. Once again let me send my sincerest thanks toall our stakeholders. I wish all of you and your loved ones health and happiness.

Till then Stay Safe and Get Vaccinated.

Yours sincerely

Kamal Kishore Sarda

.