SIMPLEX PROJECTS LIMITED
ANNUAL REPORT 2010-2011
Dear fellow Shareholders,
On behalf of the management, I take this opportunity to present to you the
21st Annual Report of your company for the year 2010-11.
In my last address, I had mentioned about the Global Economic recession and
recovery process. On this occasion I would like to share my views on the
state of infrastructure and challenges for 2010-11. There is a slowdown in
the growth rate in Indian Infrastructure sector as compared to the previous
year. We have been seeing a slow down across each quarter, from 9.4% in Q4,
2009-10 to 9.3% in Q1, 201011, to 8.9% in Q2, to 8.3% in Q3 and 7.8% in Q4,
2010-11. The Government expenditure in the infrastructure sector has come
down, thus we noticed a slowdown in both order booking and revenues.
Another important factor is the sharp price rise in all major commodities
like steel, metals, minerals, crude oil, coal and increase in the interest
rates. The combined effect of high inflation and interest rates has been
very demanding for India's investment environment. Finance is becoming
increasingly expensive and difficult to obtain. Moreover, your Company is
also affected by the political crisis and unrest prevailing in Libya. We
were constructing housing units and allied infrastructures for the
Government of Libya and our work was in full swing. We had to de-mobilise
our operation and bring back all our employees in India due to the state of
extreme unrest and revolt there. We are keeping a close eye on the events
in Libya and shall start to mobilise once the situation calms down. The
effects of all these factors has shown in our balance sheet, despite of an
increase of 29% increase in revenue, our Profit before Tax is reduced by
9.6% and Profit after Tax by around 2%.
However difficult and challenging the environment may be, your Company is
focused and maintaining high standard in its pursuits. Simplex Projects is
a reputed player in the construction space with a focus on urban
infrastructure projects. Our order book has increase by Rs. 110 Crores,
since April 2011 and the present order book position is approx Rs. 4573
crores, which includes Libyan contract. We recently bagged orders for
piling, housing and other projects. Our client list includes reputed
Companies in public and private sector. We are in process of bagging for
new projects from various State Governments in India.
Your Company has promoted a subsidiary Company, Simplex Agri-Infra Services
Pvt. Ltd. to enter into agricultural infrastructure. To start with, the
subsidiary has entered into an agreement with the Govt. of India, for
development of warehousing facilities for a capacity of over 1.50 lakhs
metric tonnes. The development work is in full fledge and we expect to
commence the commercial operation by early next financial year.
Your Company has an experienced management and is quick in identifying new
growth avenues and capitalising on them. We are also trying to capitalise
on emerging opportunities in other African countries. We have adopted a
professional approach towards managing the Company and inducted
professionals at the senior level and mid-level management to prepare for
the next level growth.
While focusing on the business, we still continue to be socially
responsible. We value the society and our employees. We continuously
strengthening the safety, health and other social initiates across all our
I would like to thank all my fellow Members of the Board and the employees,
clients, suppliers, bankers, Government agencies and other stakeholders for
their continuous support and confidence reposed on us. I am grateful to you
for your trust and faith that you have shown and looking forward for a
better performance in future.
Chairman & Managing Director