We firmly believe that our robust business model and a strong balancesheet enable us to deliver a sustainable long-term value.
I am happy to present before you the 35th Annual Report of Tata SpongeIron Limited. FY 2017-18 has been a great year as we made records in Production as well asprofit. These achievements are particularly significant in the back drop of two majorpolicies undertaken by the Central Government- the demonetisation of higher denominationcurrencies and the introduction of the Goods and Services Tax (GST). Overcoming theinitial hiccups India's GDP growth rate soon accelerated to 7.2% in Q3 which is thehighest rate among the large economies. Buoyed by the economy the consumption of steelincreased which in turn pushed the demand for sponge iron.
OPERATIONAL AND FINANCIAL ACHIEVEMENTS
In FY 2017-18 the production of sponge iron was a record 417094 MT(390000 MT in FY 2016-17) and so was the generation of power at 199 MU (186 MU in FY2016-17). The plant operated at 107% of its rated capacity. Higher demand for sponge ironcoupled with increase in production enhanced the revenue to Rs. 81664.54 lacs in FY2017-18 an increase of 32% over last year (Rs. 61516.07 lacs). Better pricing of spongeiron improved the EBITDA to Rs. 18272 lacs in FY 2017-18 an increase of 196% over lastyear (Rs. 6165.95 lacs). As a result the net profit was a record Rs. 14085.71 lacs inFY 2017-18 a jump of 140% over last year (Rs. 5874.03 lacs).
In view of the record profit the Board is happy to recommend adividend of Rs. 20 per share.
SAFETY AND ENVIRONMENT
The Company has continued to set high standards in safety. Improvementsin working practices have enabled the Company to achieve Zero Lost Time Injury to people.
Recognitions received by the Company in the area of safety andenvironment in the FY 2017-18 are as below: Recipient of the prestigious Pollution ControlAppreciation Award from State Pollution Control Board (SPCB) Odisha under the category Industry for FY 2016-17.
Declared Winner in the SHE Award instituted by CII (Eastern Region) forFY 2016-17.
You will be glad to know that your Company has been recognised as aGroup-A Company in BSE Limited. This recognition is earned due to good performance in theaspects of market capitalisation market turnover corporate governance compliance andsustainability (responsible investment).
It is heartening to note that in the Tata Business Excellence Model(TBEM) assessment the Company scored 618/1000 which is a mark of the Company practicingmatured level of excellence in all the dimensions of business management.
CORPORATE SOCIAL RESPONSIBILITY
In our endeavour to improve the quality of life of people living in thesurrounding communities the Company invested Rs. 180.46 lacs in FY 2017-18 towardseducation health and sanitation infrastructure development and empowerment of women.
India has now become the world's 3rd largest producer of Steel.The production of steel has crossed 100 MnMT and is growing at the rate of 6% per year.Considering the future growth potential of the steel industry the Company has applied tothe Ministry of Environment Forests and Climate Change for permission to set up a 1.38MnMT steel plant in phases at Joda. The Company is also on the lookout for acquiring coaland iron ore mines as and when these are auctioned by the Government.
Tata Sponge will continue to progress in its journey towardssustainable long-term growth with commitment to excellence and high ethical values.
I congratulate all the employees for such an excellent overallperformance and the Trade Union Leaders for their support in maintaining industrialharmony. I thank all the stakeholders for reposing their trust in the Management and theBoard.
|Yours sincerely |
|A.M. Misra |