It is my privilege to present the 44th Annual Report of your Company for theyear ended December 31 2017.
India's continues to be on reforms trajectory with introduction of some of theimportant economic reforms including Goods and Service Tax (GST) as the biggest reform inthe history of India. Growth in India is subdued in 2017 at around 6.7 % owing to businessadjustments to newly introduced GST. Protracted balance sheet weaknesses in particular acorporate debt outcrop and rising non-performing loans in the banking sector continued toweigh on already weak private investment in the country. India is expected to reclaim itstag of the 'fastest growing economy' among the developing countries in 2018 with 7.4 % ofGDP growth following last year's subdued performance. In 2018 Private investment isexpected to revive as the corporate sector adjusts to the GST increase in infrastructurespending and mitigation of private sector balance sheet weaknesses with the help ofefforts of government and RBI.
Global economy is expected to grow at 3.9% in 2018 as against 3.7 % in 2017. In 2017most of the world economies have seen pickup in growth in year on year terms the broadestsynchronized global growth upsurge since 2010. Faster than expected increase in advancedeconomy core inflation and interest rates inward looking policies geopolitical tensionsand political uncertainty in some countries may affect the global growth.
From second quarter of 2017 textile industry is experiencing slow-down as most of thebusiness houses have hold back their capital investment plans which in turn did impactdemand for Company's Capital Products. The domestic textile industry is one of the mostimpacted sector by GST as large number of business players are unorganized. Eliminatingbottleneck issues related to GST is imperative to revive textile sector growth.Appropriate allocation of fiscal resources under TUFS to incentivize garmenting units byway of Capital Investment Subsidy may help to give a boost for capital investmentsemployment generation and increased production capacity and exports in the textile sector.Setting up of apparel parks by the Government Free trade with ASEAN countries andexecution of proposed free trade agreement with European Union may help boost exports ofIndian textiles.
In financial year 2017 despite overall challenging business environment your Companycontinued its efforts to further penetrate its business sustain the performance andattain double digit growth in revenue. Your Company achieved standalone revenue fromoperations of Rs. 2100.82 Million (Previous year Rs.1885.13 Million) which marks growthof about 11 % in comparison to prior year. The increase in revenue is contributed bygrowth in sales of almost all product lines and more particularly Rotary Screen PrintingMachine and Nickel Perforated Rotary Screens. The standalone Profit before Tax stood atRs. 392.50 Million (Previous year Rs. 339.78 Million). The consolidated revenue fromoperations stood at Rs. 2129.66 Million (Previous year Rs. 1946.43 Million) an increaseof about 9 % in the consolidated revenue. The consolidated Profit before Tax for thefinancial year 2017 stood at Rs. 413.99 Million (Previous year Rs. 377.85 Million).
Streamlining our operations and infrastructure increased market reach improvedcustomer service and value add to customer's business with our quality products has helpedCompany to maintain its growth momentum. Our customer centric and focused approach highlyengaged and committed work-force allowed us to maintain and reinforce our strong positionacross our markets.
On behalf of the entire Board of Directors of Stovec Industries Ltd. I would like tosincerely thank our valued Stakeholders for their continued confidence supportco-operation and understanding. I would also like to thank our dedicated employees fortheir unrelenting commitment and passion that enables continuous improvement and growth.
K. M. Thanawalla