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Suumaya Industries Ltd.

BSE: 780011 Sector: Others
NSE: SUULD ISIN Code: INE591Q01016
BSE 05:30 | 01 Jan Suumaya Industries Ltd
NSE 10:24 | 12 Aug 49.05 -0.55
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Suumaya Industries Ltd. (SUULD) - Chairman Speech

Company chairman speech

Suumaya 2.0 is an inflection point in the Company's existence thatpromises attractive sustainable growth from this point onwards

Overview

I am pleased to present an overview of a reinvented Suumaya 2.0.

This report comes at an interesting time in the existence of ourCompany and in the economic journey of the modern world. In a pandemic-affected worldwhere the general consensus is to consolidate and move slower Suumaya has selected torespond to emerging opportunities enhance organisational velocity and take a decisivestep towards emerging as a multi-business conglomerate.

The Suumaya 2.0 inflection point

Suumaya 2.0 is centred around a belief that the 2020s belong to Indiaas the country graduates from the sixth largest economy to the third largest by the end ofthe decade. The Company has been woven around the priorities of a dynamic and growingIndia; what will be good for India through the decade will be good for Suumaya as well.

Suumaya 2.0 is the story of a homegrown Company possessing the visionto carve out a global niche – for India and itself. The Company intends to leverageinfrastructure capital relationship capital and financial capital to dream big for itscountry and stakeholders.

In doing so the Company will leverage the value of its experiencedBoard of Directors and youthful employees.

Suumaya 2.0 pledges to enhance consumer value and delight through theright complement of products and value. The Company pledges to enhance employment valuethrough the creation of sustainable livelihoods. It will create a B2B supply chain thatenhances satisfaction loyalty trust and passion with the objective to enhance wealth andprosperity. In doing so it will enhance stakeholder value benefiting its shareholderssuppliers financers customers and employees. More importantly Suumaya 2.0 will championthe Made in India direction of the government widen livelihoods for its youth and makethem active drivers of national potential and prosperity.

Suumaya 2.0 and a growing India story

A number of sectors in India are being driven by long-term policiesenhancing investor clarity and national direction. These reforms are being introducedacross sectors as large and core as power infrastructure fuels renewable energy miningand agriculture. Our optimism is derived from the fact that even a moderate improvement ineach can have a large national catalytic impact that translates into significant GDPgrowth. This is likely to graduate India towards the desired USD 5 trillion scale andposition of the third largest economy during the course of this decade.

This large growth will generate opportunities across the core sectorsbeing reformed benefiting the nimble and prepared. At Suumaya we are driven by theprospect of maximising value for all our stakeholders.

Rather than merely extend our response to market realities in a‘business as usual' manner the management responded with a decisive structuralshift that is best captured in its ‘Suumaya 2.0' positioning. This positioningindicates that the Company has made a decisive break from its past that prospects fromthis point will be attractively and disproportionately different and that the Company willenhance value for stakeholders in a sustainable manner.

Our vision

At Suumaya our structural shift has been inspired by a compellingvision of where we see ourselves a decade from now as a multi-business conglomerate bythe end of this decade.

We see ourselves as a governance-driven organisation driven by systemsand processes that have been clearly defined resulting in decision-making visibilitytransparency and predictability.

We are committed to enhance value for all our stakeholders.

We perceive a long-term opportunity in widening our business portfolioin line with the growing priorities of a dynamic India. Each business vertical of ourCompany is headed by a professional accountable to the Board for performance and growth.

The Company reported 70.63% of its revenues 55.98% of EBITDA and64.77% of profit after tax in the last quarter of FY 2020-21 indicating theattractiveness of the opportunity in a full year's working.

We are addressing the global climate change challenge as anenvironmentally responsible company that will seek to enhance its presence in sustainablelines of business.

India outlook

In Suumaya 2.0 we will ensure that our business model is increasinglyaligned with the needs of a growing India.

The growing India will not be limited to lifestyle trends alone; amodernising India will be driven by enhanced efficiency superior resource utilisationlower income inequality and financial inclusion.

We believe that whereas some of our businesses will address thelifestyle opportunity of an aspiring India some will address the above mentioned factors.We believe that while the qualitative churn will continue the country will experience awidening of its consumption pyramid. India will continue to add more than 1.0% to itspopulation each year; this will translate into a nearly 16-million increase in annualheadcount the largest population increment anywhere in the world; this could make Indiathe most populous country towards the end of this decade. Besides the aspirational churnin India is expected to widen the market for a range of products faster than we havepossibly seen in our existence. (Source: Medindia. net) Financial performance and BalanceSheet

During the year under review a reinvented Suumaya capitalised withspeed to the evolving environments.

Following the outbreak of the pandemic the Company was quick todiscern a rising demand for medical textiles used in personal protecting equipment. TheCompany was quick to address this reality; it utilised its longstanding experience withinthe textile sector to emerge as a dependable supplier of medical textiles that enhancedprotection for users during the pandemic. The result is that textiles accounted for RS.863.92 crore of revenues during the year under review.

The Company entered this space of agri supply chain business during theyear under review. Within the space of a single quarter the Company reported asubstantial performance in revenues and profits. The scale of our agri supply chainbusiness proved far larger than our other businesses to the point that the longstandingpersonality of our Company was transformed. From this point onwards the principal recallof Suumaya will be that of a growing and dynamic agri supply chain company that addressesthe needs of the country and its people.

The result is that the Company strengthened its turnover 19-fold in FY2020-21 over the previous financial year; EBITDA increased 40-fold over the previous year;profit after tax strengthened 49-fold. The Company's EBITDA margin was 11.15% in FY2020-21 compared with 5.47% in the previous year. The Company reported an earnings pershare of RS. 168.52 in FY 2020-21 compared with RS. 3.40 in the previous year indicatingthat the Company's business model enhanced shareholder value. The Company reported70.63% of its revenues 55.98% of EBITDA and 64.77% of profit after tax in the lastquarter of FY 2020-21 indicating the attractiveness of the opportunity in a fullyear's working.

Strategic direction

The Company's promoters are convinced that with the world'sagricultural space being finite and population continuing to grow humankind's nextbiggest crisis after climate change is likely to be the need to mobilise adequate food.This challenge and emerging mismatch will enhance the need for responsible interventions.

Besides we believe that with the world increasing its focus onindustrialisation and service-driven growth with a corresponding decline in agriculturalinvestment the time has come to make a decisive U-turn if humankind is to protect itsnutritional intake. We believe that the skew will enhance opportunities in the transfer ofagricultural products from countries and regions of surplus to those with deficiencywidening opportunities for those addressing the agri value chain. We believe that thehistorical under-remuneration to farmers will need to be corrected with speed. As aforward-looking organisation Suumaya's market linkages financial assistance andother supports are expected to provide farmers with an incentive to grow morestrengthening in a small way the country's farm security. Suumaya's robustsupply chain – from farm to fork – will emerge as a robust growth driver withinfluence extending beyond the regional to the national to the international. Bystrengthening a sector that is core to national progress and prosperity we expect tocontribute to India emerging as a super power.

In the coming decade we will grow our agri produce value chainbusiness focus on widening the products addressed deepening our domestic presenceestablishing an international business enhancing value in the hands of farmersstrengthening trust and creating a robust supply chain.

I am optimistic that our initiatives in this direction will enhancerevenues and hence value in the hands of all those associated with our Company. I mustacknowledge the contribution made by all our stakeholders during the last financial year– our bankers our shareholders our employees our customers the governmentagencies that facilitated our growth and lastly society as a whole. We are grateful forthe faith reposed in us and will continue to sustain our growth across the coming years.

The business lines of Suumaya 2.0

Supply chain: Agri textile and logistics (including warehousing) Retail:Fashion kirana stores and consumer items Infotech: Digitalisation of our supplychain and retail business

Financial services: STF and financing against commodities.

Ushik Gala
Chairman and Managing Director

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