I take this opportunity to convey my thoughts to you through this Annual Report sharewith you all an update on the Company's performance for 2019-20. I do hope and pray thatyou and your families are safe and well in these challenging times.
The biggest challenge faced today by most of the countries Governments businesses andpeople around the world is the health crisis triggered by COVID-19. The Government ofIndia acted very fast and is taking all-round measures to contain spread of the disease.But the fight is not easy especially for the medical professionals who are working veryhard to save human lives. I would like to express sincere gratitude to all those who areengaged in the fight against the disease.
Against this backdrop continuity of manufacturing operations along with health andsafety of our employees have remained our top priorities as we navigate through thiscrisis. The Company has implemented stringent controls in accordance with the Governmentdirectives and guidelines to prevent the spread of COVID-19. Besides continuous educationis being imparted to the workforce to observe high degree of self-discipline. They areregularly being reminded of not letting their guards down at any moment whether atoffice shop floor of the Company or outside.
At the time when the automobile industry is witnessing a once in a centurytransformation across the globe events like COVID-19 have further increased thecomplexity of business. We are fortunate to have the support of our customers with whom wehave long-standing business relationships.
In this new normal we stay resolute and focused by leveraging our strengths. Wecontinued to deliver the best of automotive component solutions to our customers acrossthe globe on the back of our determined strategies innovative offerings and manufacturingexcellence. The management is also focusing on costs efficiencies and initiatives for thelong-term all of which are expected to yield creditable market and financial performancedespite the odds.
Macroeconomic and industrial Scenario
The Indian economy faced strong headwinds with declining growth numbers during theyear. The softening growth can be attributed to weak demand in the manufacturing sectorliquidity crunch and subdued consumption and investment. The GDP declined by 1.9% ascompared to FY 2018-19 plunging to 4.2% this financial year. The industries that weoperate in displayed a paradigm shift even before the COVID-19 outbreak. The Governmentand RBI announced a variety of measures to address the challenges. The countrywidelockdown to limit the pandemic transmission had an adverse impact on overall economicactivities. As the spread of the pandemic gradually subsides the economy is expected toreturn to its growth trajectory in the long run.
The year 2019-20 was a tough year for the Indian automobile industry with massivestructural changes. The industry witnessed slowdown owing to liquidity crunch weakeconomic activities and low consumer sentiments. Increased insurance cost and prices withtransition to BS-VI added to the woes. The industry produced a total of 26362282 (unit)vehicles in 2019-20. Besides the sale of passenger vehicles and three-wheelers declinedby 17.88% and 9.19% respectively while two wheeler sales dipped by 17.77%. The pandemicand the enforced lockdown disrupted the supply chain and impacted production. However oneof the good thing is that the export numbers displayed positive growth during the year.
The prospect of Indian auto component industry is linked with the growth of theautomobile industry. The rural market saw good recovery which positively impacted sales oftwo-wheelers and small commercial vehicles in June 2020. The industry is expected torecover during second half of 2020-21 underpinned by good monsoons and reduced interestrates. The Government has also taken several initiatives to boost the automobile sectorlike increase in custom duty on electric vehicles extension of FAME-II liquidityinfusion measures among others. In addition the Government's focus on accelerating newregulations electric vehicle infrastructure and shared mobility as an alternative areexpected to push the demand for vehicles in the future.
The year 2019-20 proved to be a challenging year with unfavourable macroeconomicenvironment and nationwide lockdown impacting our performance as well. Our consolidatedtotal income from operations stood at Rs. 385.29 crores in 2019-20. Profit beforeexceptional items was recorded at Rs. 13.52 crores while profit after tax stood at Rs.12.19 crores in 2019-20.
We remained focused on making our operations stronger and enlarge our footprintglobally with innovative solutions and robust manufacturing capabilities. We are extremelyproud to report that the Company bagged orders worth USD 31 Mn across Forging Gaskets andone JV Company for domestic as well as export markets. The Company's persistent effortstowards growing export market product development and testing with global auto majorshave paid off. It is a huge validation of our technical capabilities and opens the doorsto secure more business even during turbulent times.
We have a standalone business of gaskets forgings and three joint ventures.
With world-class technical capabilities our gasket business is now totally BS-VIready. We have started supplying BS VI compliant gaskets to Hero Volvo Tata motors andTata Cummins. We continued to focus on capturing newer markets and enhancing ouractivities towards OE contracts with exports.
We have a dedicated heat shield gasket line critical for heat sound and vibrationinsulation. This is the future for automobiles and the Company stands to gain businessorders from global OEMs.
We have also developed new gasket technologies like Cover Gasket integrated withinjector wiring harnesses. The Company is expected to get good business in the current andthe following years. The Company has made major investment in creating dust freeenvironment and in developing high performance sealing technologies and materials to meetthe requirements of new generation BS VI engines. The gaskets business recorded revenue ofRs. 256 crores during the year 2019-20. We expect rising demand for our products such asheat shields and wire harness gaskets from major OE players post BS VI implementation.During the year we secured orders from European and US car manufacturers. Our rawmaterial sourcing strategies and localisation will result in operational costs savingreduction in raw material inventory and working capital requirement.
The forging business recorded a revenue of Rs. 130 crores during the year. We areswiftly moving towards heavy value machine components which will improve our margintrajectory.
The Company completed installation of the 2500 tons press which will place it as aone stop solution provider for forging between 750 tons to 2500 tons. We startedsupplying to
OEMs in premium car segment and provided forging solutions to power generation industryas well. The Company is one of the leaders in the forging business supported byoperational excellence and long-standing relationships with OEMs in India and overseas.
Our first JV Company Nippon Leakless Talbros Private Limited (LTL) expanded businesswith two-wheeler OEM's by successfully developing gaskets for BS VI engine. The revenuesstood at Rs. 105.07 crores during the year.
Our second JV Company Magneti Marelli Talbros Chassis Systems Private Limited (MMT)reported a revenue of Rs. 136.78 crores during the year mainly on account of betterrecoveries for the new businesses. We won orders from global OEM customer to supplysuspension lower control arms. The Company expanded manufacturing capacity in the westernpart of the country to continue delivering the best quality products and capture highermarket share.
Our third JV Company Talbros Marugo Rubber Private Limited (TMR) registered a revenueof Rs. 46.03 crores. We continued to explore opportunities by expanding business withLCV/HCV segments and global OEMs.
Our fundamental values and intrinsic strengths have helped us navigate throughuncertainties. At Talbros we are well-equipped to capitalize the opportunities resultingfrom new regulations and are staying focussed to provide future-oriented products to ouresteemed customers. I am confident that the new business orders will hugely benefit thebrand equity of the
Talbros Group and further enhance our commitment to Make in India' Initiative ofthe Government. It will be conducive in providing us long-term visibility and businessmomentum.
Before I conclude I wish to thank all my Board Members regulatory authorities ourmanagement employees and the stakeholders for their unwavering guidance and support. Welook forward to continuously deliver sustainable value to all our stakeholders.