VIP Industries a market leader for over half a century has built a rich heritage andstrong legacy for itself. Apart from luggage the organisation has been a pioneer in Indiafor many categories like moulded chairs toys and furniture. For over five decades theCompany has stood for quality and innovation revolutionising the luggage and travelcategories in India. Today this rich heritage and legacy inspires us to constantlyre-invent ourselves to respond to the promise of new opportunities. Our multi-brandstrategy helps us cater to customers across segments.
The Indian bags and luggage sector is a proxy play to the travel industry. It has beengrowing at a brisk pace of 12-14% CAGR over the past decade. While the pandemic breakoutand the ensuing lockdowns travel restrictions and health anxieties temporarily haltedthis growth the momentum has returned with a recovery in airline passenger trafficcoupled with normalcy across the economy. With the success of the massive COVID-19vaccination programme and with potential variants of the virus likely to be much milderconsumer confidence in travelling has also been restored. Further the demand for travelis expected to buoy the industrys continued recovery despite headwinds frominflation and geopolitical risks. This will in turn support and boost the demand forbags and luggage.
VIP Industries leadership position in the Indian market provides us withsignificant scale strength experience to grow our position globally. We are already thelargest manufacturer in the world with our in-house production giving us an advantage interms of cost competitiveness. In recent years we have further strengthened ourmanufacturing capabilities and reduced our sourcing from China to only 8%. We remaincommitted to further growing our manufacturing capacity and maintaining overall in-housemanufacturing of 75-80% through our Indian and Bangladesh units by FY 2022-23. This highlevel of backend control I believe will be the key driver of our future success and helpus put VIP Industries on the global map.
Business activities with a focus on sustainable value creation and innovation is oursteadfast commitment to all our stakeholders. Towards this end our management teamcomprises professionals with great experience energy and enthusiasm for the job and adetermination to achieve superior performance. Our corporate governance philosophyunderpinned by our strong focus on achieving the highest standards of integrity ethicsand professionalism with effective and oversight and monitoring will continue to providea solid basis for enhancing stakeholder value.
Looking towards the future VIP Industries is well-positioned to take advantage ofunfolding opportunities.
Favourable demographics an increase in income levels as India marches ahead on a highgrowth trajectory and the growing trend of discovering new experiences and places willprovide a fillip to the demand for bags and luggage. We are grateful to all our customersfor their loyalty and we will keep bringing newer and better products to serve thembetter.
We at VIP Industries are ready to take on these exciting times with a freshprofessional team at the forefront with diverse experience background from parallelindustries and skills that can take VIP from a national brand to a global player.
Finally our employees have worked hard together to ensure the delivery of impressiveresults in challenging conditions. On behalf of the Board I would like to thank them fortheir efforts. We also appreciate the trust our investors have placed in our Company andthank all other stakeholders for their support. I am confident the future journey holdsconsiderable promise and optimism.
Dilip G. Piramal