We write to you amidst the pandemic even as we celebrate internally to be amongst theworld's most competitive producers of Chlorophenols products of Ammonolysis andAcetylation and hydrogenated products. Our cutting-edge technology and automated plantsare well capacitated to satiate the growing demand for speciality chemicals in India andmakes us well positioned to leverage the changing market dynamics.
The year that passed by was one of hope amidst despair.
We share with pride that we managed to record a 15% increase in bottom line even in anotherwise challenging year as far as the operating environment was concerned. More so wehave secured a place among the coveted BSE- 500 list. This is a testament to our businessresilience demonstrated by a robust operational and financial performance even amidst thechallenging economic conditions further accentuated by the outbreak of the novelCoronavirus pandemic towards the end of the year. We made notable progress in our exportbusiness which balanced the decline in domestic revenue.
We faced these turbulent times with positivity and spent the year in fosteringresilience across our business
processes - capacities capabilities expertise human capital culture andcustomer-centricity. In addition to strengthening our core fibre we utilised theopportunity to foray into newer industries and add more clients - even as we maintained astricter control on operational overheads.
HOW WE PERFORMED
We had a satisfactory year across all business parameters generating outstandingreturns for our shareholders despite having lost out on 10 full days of revenue duringthe month of March 2020 on account of the nationwide COVID-induced lockdown. We achieveda top line of Rs. 584 Crores as compared to Rs. 606 Crores in the previous year. Our NetProfit stood at Rs. 139 Crores compared to Rs. 121 Crores earlier which is higher by15%. EBITDA increased 5% at Rs. 193 Crores compared to Rs. 184 Crores in the previousyear. Our Earnings Per Share stood as Rs. 114.02 as compared to Rs. 99.82 in the previousyear.
TACKLING THE COVID-19 CRISIS
As we are all aware the already prevalent broad-based slowdown in the Indian economyand the ongoing trade war snowballed further with the advent of COVID-19 and led to anextended nationwide lockdown and disrupted economic activities. It led to a temporaryshutdown of our manufacturing facilities and we also faced logistical constraints inmovement of goods and manpower. However we swiftly resumed operations in mid-April postregulatory approvals and worked towards effective plant utilisation as well as completewell-being of our employees.
To safeguard the health and well-being of our employees we established standardoperating protocols and procedures as we commenced our manufacturing operations. Thisincluded daily sanitisation of all our facilities temperature scanning wearing of safetygear and ensuring social distancing amongst the employees. Additionally we alsoproactively adopted the "Work- from-Home" culture by providing adequateconnectivity and deploying relevant data-security measures to our employees ensuringseamless continuity of our business operations.
LEVERAGING A DE-RISKED BUSINESS MODEL
In the current challenging times it is our strong and de-risked business model that isproviding us with creative survival strategies. We cater to diverse sectors and end-userindustries through our broad product portfolio. Our extensive domain expertise in multipleprocess chemistries has lowered our dependence on a single chemistry and further widenedour customer base. Not only this we have also widened our global footprint by increasingour exports. Today we export our products to various geographies across the globe whichcontributes 15% to our revenues. This accords us with a superior ability to withstandindustry and country-wise specific shocks.
The synergistic acquisition of Amarjyot Chemical Limited during the previous year hasmade us one of the leading manufacturers
and suppliers of chemicals. It helped us attain increased manufacturing capacities andalso provided significant depth to our product offering with a wide spread of value-addedproducts. Today we can command a niche and value-added product portfolio that findapplications in dye pigments pharma and agro-chemical intermediates industries. Backedby a strong portfolio of high-quality and innovative products coupled with ourcompetitive cost advantages we are confident of maintaining stability and sustainabilityin our operations and profitability as we move forward.
BUILDING OUR CORE FIBRE
We support the government's "Make in India" initiative with the objective ofjob creation and nation-building initiatives and to transform India into a globalmanufacturing hub. To actively participate in this we maintain a stringent focus onexpanding and augmenting our manufacturing strengths and capacities.
In light of the growing demand we increased Chlorophenol capacity to 18000 MT perannum by completing the expansion at the Sarigam plant. We added Ortho Nitro Anisole andPara Nitro Anisole to our portfolio. We also undertook expansion at the Jhagadia plant forhydrogenation. Backward integration will enable us in manufacturing key raw materialsin-house and in providing significant cost savings and better profit margins.
We have increased the capacities of our hydrogenation products from the earlier 18000MT per annum to 26000 MT per annum. Further we are increasing the Ammonolysis capacityat Tarapur and Vapi plants from ~13000 MT per annum to 16000 MT per annum. We are likelyto commence operations of Para Amino Phenol (PAP) and Ortho Amino Phenol (OAP) which areimport substitutes in the second half of FY 2020-21. PAP has been identified as keyintermediates of pharma products by the government which is to be incentivised underrecently announced PLI Scheme. The management is considering to set up a plant forParacetamol with other drug intermediates and APIs in future.
All these are expanding our capabilities and helping us cater to the growingaddressable market and heightened demand for our intermediates in end-user industries.Improvement in capacities is leading us to become a significant player with robustfinancials and a healthy bottom line turning us into a reliable and long-termhigh-quality supply chain partner and improve our profitability.
Further to improve operational yield cost efficiencies and safety our constantendeavour is to automate our operations and reduce human intervention. Today our TarapurVapi and Jhagadia plants are in the process of being automated.
During the year we continued our emphasis on consolidating our operations byintegrating the processes and moving up the value chain. Today our multi-purpose plantsenable us service the diverse needs of our customers while achieving economies of scale
and improving our cost efficiency. Our increased manufacturing capacities coupled withR&D strengths and integrated operations are constantly enabling us to develop highvalue and margin accretive downstream products and value-added import substitutesproviding increased growth opportunities and superior revenue visibility. With all thesestrategies we are on the constant path of achieving sustainable growth as we deliverenhanced value creation capabilities and strengthen our resilience to face thechallenging times yet come out unscathed.
BENEFITING FROM INDUSTRY DYNAMICS
China's competitive position in the global markets has been diminishing in the past fewyears on account of stringent environmental and safety norms imposed and led to theshutdown of several chemical plants. With a significant increase in compliance costs manychemical plant operations have become unviable. India with its low-cost advantage isemerging as an alternative manufacturing and supply chain hub for major global economies.
Being among India's leading specialty chemical manufacturers we at ValiantOrganics Limited are well positioned to capitalise on these emerging businessopportunities by significantly leveraging our operations expanding capacities andextensive domain knowledge. We remain confident of growing our market share in thedomestic and international markets by virtue of our strong and niche product portfolioenhanced capacities and R&D capabilities. Adding to this our competent and highly-qualified Board with deep domain expertise and vast cumulative experience enables us wellto undertake the advantages posed by changing industry dynamics.
We are well prepared to take advantage of the growing opportunities in specialtychemicals as India's specialty chemicals market sets itself on the growth path forthe coming years and with a rising need for specialty chemicals in the end-use domesticmarkets. As we add specialty chemicals to our portfolio and continually update our productmix we remain well positioned to capture this growth and become a leading specialtychemicals player in India delivering sustainable stakeholder growth.
I would like to thank all our key stakeholders for their continued support and faith inthe Company. I would like to especially appreciate all our employees for their extendedefforts postlockdown as we re-started our plants and resumed operations.
Moving forward we will continue our commitment to achieve sustainable growth bybuilding a resilient business model and ensuring inclusive growth for all ourstakeholders.
Arvind Kanji Chheda