Ladies & Gentlemen,
I have great pleasure in welcoming you to the 27th Annual General Meeting of your Company.
The company’s Annual Report and Audited Accounts for the year ended 31st March 2016 have been with you for some time now and with your permission, I shall take them as read.
Performance of the Company
The Company’s performance has been discussed at length in the Directors’ Report and in the Management Discussion and Analysis Report.
I am glad to inform the shareholders that the Board of Directors after giving a very careful consideration have declared and paid an Interim dividend of 1 Rupee per share (10%) which is the same as last year inspite of the difficult industry scenario.
The drop in demand of Poly Iso-Butene in the domestic market and tough competition from overseas suppliers especially Korea, your company has performed well despite these challenging circumstances.
I am pleased to report that your company has achieved 4.96 million accident free man hours since inception, thanks to the stringent safety and security measures at the plant as well as the dedicated involvement of the employees.
In order to become more competitive in the domestic and global markets, efforts are being taken to enhance the raw material supply from the nearby Chennai Petroleum Corporation Limited Refinery. We expect to draw the benefit from this in the 3rd quarter of the current financial year i.e. 2016-17.
This project would leverage our close proximity to suppliers and substantially save on raw material transportation.
Your company has planned to construct a 2 mega watt capacity captive power plant using a low cost, bio fuel based boiler. This will make the plant self sufficient for steam and power. The project will help to mitigate the inconsistent power availability and also reduce the Utility costs.
This facility will be in operation from the 1st quarter of next Financial Year which will further strengthen our position in the market. Further the consistent availability of power will provide us with new market segments and increase our customer base.
With the addition of new facilities to handle the extra supplies from the nearby refinery, teething troubles will be overcome quickly and we are confident of reaching new heights in the future.
Your company is exploring the opportunity to create an Research & Development facility to develop new products based on the available feedstock from the nearby Refinery as well as add value to our existing Poly Iso-Butene, both in quality, process and product. This is, of course, the 1st step towards our aim to diversify and take the business in a new direction.
Your company will take a decision shortly on the status of the overseas subsidiaries & its future. We hope to repatriate this money to better manage our cash flow requirements for our raw material enhancement project.
This will minimize the finance cost for our capex.
I am also very glad to inform you that your company has improved its presence in the market and is presently catering to more than 70% of the total Poly Iso-Butene demand in India, As compared to the year 2014-15 when we had a presence of 55% of the domestic market share.
During the year, better control was exercised in managing the receivables and utilization of working capital limits. This has resulted in maintaining the finance cost relatively the same at last year’s level.
I express my gratitude to all the shareholders for their continued co-operation. I thank my fellow Directors for their support and valuable guidance. I also thank our government, bankers, employees, our customers, dealers, suppliers and other business associates for their support and cooperation.
I look forward to your continued support to take the company towards a promising future.
With warm regards,
Nina B Kothari
4th August, 2016