It gives me great pleasure to welcome you all to the 26th Annual General Meeting ofShree Pushkar Chemicals & Fertilisers Limited. I would like to thank you for sparingyour valuable time to be with us today and for your continued faith in the Company. I amgreatly honoured by the trust and confidence reposed in our company and our Board by youall Shree Pushkars financial performance during FY19 has been presented incomprehensive detail in the Annual Report that is already in your hands. What isheartening is the fact that inspite of all odds we have still continued to maintain asteady growth which has been an assimilation of the performance across all our productverticals as also our subsidiary Kisan Phosphates Pvt. Ltd.
The most important aspect that I wish to highlight is the determination and commitmentwhich our Executive Management displayed throughout the year. A special emphasis needs tobe made here is the conservation of the fund at our disposal resorting to minimalborrowing inspite of a fairly good availability of working Capital facilities from ourBankers. This has also been a hallmark for Shree Pushkar and we take pride in the same.
During the year Shree Pushkar further strengthened its branding with our existingtagline of Zero Waste with the addition of Dyecol the chemistry behind colors which highlights the credential of theCompany in terms of its business model on the one part and the quality-control of ourproducts in terms of accreditation of Bluesign as a system partner ZDHCContributor & GOTS The Global Organic Textile Standard. Yourcompany thus enjoys the trust with its valued customers bankers shareholders businessassociates and vendors alike. It is indeed this 'Trust' that we strive for which theCompany has diligently built over the last 2 decades with all its stakeholders culminatingto The Shree Pushkar what it is today.
All this have been achieved on the backdrop of a global economic slowdown. Theprevailing economic scenario has brought about an atmosphere of uncertainty touching allmajor global economies. The international political scenario has been gloomy with theheightening trade war between the two largest economies affecting the entire world. Thehanging BREXIT the unrest in Hong Kong the emerging trade war between Japan & SouthKorea the slowdown of the economy in Germany & Italy all this have kept all themajor economies affected leading to a shrinking consumer demand globally.
Back home we have been witnessing flight of capital by Foreign Investors affectingour stock markets very badly leading to a continues fall in stock prices acrossindustries over the last nearly a year.
Inspite of all these odds if you view the operational performance of the year youwill observe that the performance has been quite satisfactory. The product volumes in theDyes andIntermediatesverticalshaveregistered significant growth . As you are aware that inaddition to the marketing of generic dyes we had introduced last year our own brand underthe name of "DYECOL" the brand has received a good response from the market andwe are not only marketing the product in the domestic market but also have good responsefrom countries like Switzerland Austria Bangladesh Singapore Korea Taiwan etc werewe are exporting our products regularly resulting in increased exports which has gone uparound 3 folds to Rs.91.54 Crs at 20.26% of the overall sales when compared to Rs. 31.52Crs at 7.97% of the sales during the preceding year. The production levels ofIntermediates though not apparent on the surface has had a good growth clocking anaverage utilisations of over 90% and after meeting the increased captive consumption forthe manufacture of dyes it has registered fair growth in sales volumes along with betterprice realizations.
The performance of the fertilisers division was subdued mainly on account of erraticrains in certain parts of the state which witnessed low to scanty rains resulting inunsatisfactory performance on a stand-alone basis. We could however substantially mitigatethe same on account of better price realizations and our satisfactory sales in NorthernIndia through our subsidiary namely Kisan Phosphates.
On the whole the overall performance on a consolidated basis has been fair achieving agrowth in the range of 13% as compared to the preceding year.
I have pleasure in announcing that the 100 TPD Sulphuric Acid plant in Kisan Phosphatesalong with the 750 KW captive power plant has been commissioned in March 2019 and isoperating satisfactorily. This addition would help us in a big way in improving the top aswell as bottom lines of the company in the coming years.
I also take pleasure in announcing the following expansions totally estimated at Rs.118.00 Crs.
1. Our move for acquiring one more SSP plant in MP through NCLT under the IBC code. Theplant has an installed capacity of 150000 MTA. We have been adjudged the highest bidderand our offer has also been accepted by the Committee of Creditors (CoC) and we areawaiting the final orders of the NCLT which is expected shortly. With this acquisition wewould be in a position to cover up a major portion of the belt starting from UP HimachalHaryana and Rajasthan in the North through MP Chhattisgarh parts of Eastern Gujrat incentral India reaching up to Goa and Karnataka in the south. This would make our presencequite significant in the Fertiliser market of the country MTA of SSP along with ourauxiliary products of "Dharti Ratan" & "Pashu Ahar". Thus with ouroriginal entry in the fertiliser division with SSP way back in 2012 with the basicintention of utilising our spent acid the division has now become a full-fledged Productvertical which in the years to come would contribute over 20% to our top line. The totalinvestment in the Company is estimated at Rs. 28.20 Crs to be met through internalaccruals. our project
2. Another small but equally significant of getting into Non-Conventional Energynamely into solar power exclusively to meet our captive needs through "Open Accessscheme" of the government. The Capital Cost is estimated at Rs. 10.00 crs to be metthrough internal accruals. As you might be aware that we have been spending sizablytowards electrical power which accounts for nearly 5% of our manufacturing expenses. Atour unit-1 we on an average are spending about Rs. 10.0 Crs towards power bill per annumand the power tariff is as high as Rs. 9.75 per unit consumption. While with the solargeneration the operational cost per unit would be as low as Rs. 2.00 thus effecting asaving of Rs. 7.75 per unit of generation.
3. We have also taken up revamping of our unit-1 which is the oldest unit in ourstable and needs revamping of some of the old plants which are 15 to 20 years old. Theestimated cost for the same is estimated at Rs. 5.0Crs.
4. As regards the implementation of the expansion by way of our 5th unit at theestimated cost of Rs. 75Crs we have had an overall delay in the implementation of ourproject by about 6 to 8 months due to change in the classification of the MIDC Ind. Areaat Add. Lote from Chemical to Non-Chemical zone. We were therefore forced to shift ourexpansion of unit-5 to a recently acquired additional Plot bearing No. D-10 in MIDC Lote.We have therefore surrendered the earlier allotted plot at B-29 Add. Lote MIDC and in itsplace have been allotted a new plot in MIDC Lote which is now being kept for our futureexpansion. Though at the face of it this may appear to be a setback with regard to thetime lost however it has its own silver lining in as much as we are no longer resortingto the issue of Convertible warrants as was originally proposed but are now meeting theentire cost of through internal accruals leading to non-dilution of equity resulting inhigher EPS and valuation to existing shareholders. Further the availability ofinfrastructure like power & Water at our new plot site at D-10 MIDC Lote would be mucheasier besides the fact that in view of the overall slowdown in the economy we havegained sufficient time to plan our expansions in a timely manner. On the whole I may sayShree Pushkar today is now better placed for the expansion than earlier.
I also take the pleasure of announcing that your Board of Directors has recommended adividend payout of 15% amounting to Rs. 1.50 per share for the FY 2018-19.
I once again thank you for your support and I sincerely look forward to your continuedsupport in the future as well. I also express my heartfelt thanks to my colleagues andteam at Shree Pushkar without whose active support; it would not have been possible toreach the current stage.
Chairman & Managing Director.