OVERVIEW:
Despite of a few global challenges India continued to be strong in
terms of growth. India being among the Top 10 in terms of growth and economy, GDP is also
estimated to grow around 7% in the current financial year and is expected to maintain in
the coming years.
The financial year 2022-23 proved to be a diverse operating
environment. Again, the aluminium prices were volatile this year, mainly at the start of
the financial year where it was at its peak and started melting down gradually throughout
the year.
The Company continues to enjoy favourable terms with its vendors /
customers for effectively managing its working capital requirements at optimum cost. The
Company continue to focus on timely collections & also planning procurement optimally
to mitigate fluctuations in raw materials prices and for minimising the logistic costs.
The Company has its well-defined policy to protect the infrastructure
and secure its information. The policy clearly stands to safeguard all information in the
interest of the Company. The Company has a robust security mechanism designed to defend
and protect its infrastructure from external threats or vulnerabilities.
In the short to medium term the Company expects strong revenue growth,
better operating margins, increasing contribution of value-added products & continued
focus on efficient working capital management.
This year company has opened two new depots i.e., Patna and Zirakpur
and has plans to open new depot at Jaipur to penetrate the Brand EUROBOND all over
India.
COMPANY PERFORMANCE:
Financial year 2022 2023 again saw a robust demand due to development
in infrastructure and construction Sector in INDIA under the leadership of Our Honourable
Prime Minister Shri Narendra Modiji. The Company earned operational income of 32,953.93/-
(in Lakhs) compared to 21,625.43/- (in Lakhs) in the previous year. This shows significant
increase in turnover during the year under review.
Profit after tax for the year under review is 1,007.85 /- (in Lakhs) as
compared to previous year figure of 1,309.05/- (in Lakhs). The decline is mainly due to
the volatility in the prices of raw material.
The companys financial performance during the Financial Year 2022-2023
has been considerably good. Further, the Management is hopeful that Company will register
even higher growth rate in future as the Corporate.
OPPORTUNITIES:
- Brand
Eurobond is a uniquely positioned brand in the market and enjoys a
strong recall with fabricators, Architects & Consultants. It is trusted for its
quality, innovation and its robust supply chain in the market.
- New Product Innovations
The company has been a torchbearer when it comes to innovation, be it
in the segment of product variants like Aluminium Honeycomb Panels, Aluminium Core
Composite Panels and Zinc Panels as well as in the segment of product designs and
finishes. We are proud to offer our clientele a diverse array of choices to beautify their
spaces.
- Expanding Reach
The company has a widespread, Pan India presence through its 11 Depots,
90 Distributors, and 5000+ retail touchpoints. Now the company is focusing on making the
brand "Eurobond" presence in the rural parts of India as well i.e., going from
urban to rural. Company is opening new depots every day to expand its reach.
- Catering the World
While we have been exporting to 12 countries worldwide, weve also
established channel partners in a majority of them. This year we have achieved growth of
17% in Export Sales as compared to last year and we are continuously focusing on
increasing our sales and making brand "Eurobond familiar worldwide.
- Infrastructure Development
The ACP industry is expecting to see a robust growth owing to the
government thrust on construction of smart cities, airports, metros in Tier -1 Cities and
improvising the quality & standard of railway coaches.
As India is continuously focusing on the infrastructure and
construction developments, we believe infrastructure andconsequently, the facade industry
will have a significant role to play in the upcoming years.
THREATS:
- Dependency For Raw Material
As Aluminium pre coated coils are imported, were dependant on imports
for a core raw material. Disturbances in global trade due to events like the
Russia-Ukraine War, Rupee depreciation against USD, Lockdown in supplier countries, etc
lead to a disturbance in the raw material procurement cycle.
However, to overcome this we have already executed the backward
integration whereby we are setting an aluminium coil coating line, through which we can
coat our raw materials inhouse and deliver the goods timely for more market share.
- Competitive Market
Year by Year owing to the robust growth in the Facade & ACP segment
due to infrastructural and construction activities going throughout the country, all these
leads to increase in the number of competitors in the market. This poses a challenge when
it comes to product standardisation and quality adherence and new products innovation and
adapting to new technology. However, Eurobond being among the first 2 brands to introduce
ACP in India, enjoys a goodwill of 19 years in the market. And Eurobond is also committed
to its Quality standards and adaptability to new technologies which makes the brand
altogether a Pioneer from others.
PRODUCT WISE PERFORMANCE:
While the demand for ACP is rising due to emergence of new applications
as well as increased market penetration in existing applications, the most positive aspect
is the growth in fire retardant segment. FR products are now dominating in the market and
the company anticipates this to grow each year with the due importance being given to fire
safety.
BRAND WISE PERFORMANCE:
Your Company is engaged in Manufacturing ACPs under two brands
"Archer / Eurobond". Eurobond is the brand that is well known in the premium
segment due to its quality. Archer is the brand that caters to the economy segment, being
partitions, signage, interiors, and more. Through this strategy the company is increasing
market share in each segment of the market.
RISK MANAGEMENT:
Your Company focused on proactively managing the external and internal
risks through appropriate business strategies addressing supply chain issues, employee
health, safety and well-being, dealer and supplier sustainability, launch of new products,
enhanced productivity and cost improvement programs. These initiatives have supported your
Company to be agile and resilient to the ever-changing business environment while also
generating value for all its stakeholders.
ENVIRONMENT, HEALTH & SAFETY:
The Company is committed to promote a safe and healthy environment for
its employees and community. Through education, auditing and monitoring, technical
consultation, and the provision of direct services, the Company mitigates the
organizational risks and meets its responsibilities for health, safety and environmental
requirements. To improve the consistency of the organizations approach towards
environment safety controls, the Company implemented ISO 9001 and introduced a series of
global standards, principles and practices that each operation should adopt. ISO 9001
focuses on managing organizations impact on the external environment, to reduce pollution
and comply with regulations. Improving safety performance continues to be a priority for
the Company. Improvements have been made in the methods of internal communication,
knowledge sharing and reporting on safety matters.
OUTLOOK:
Further, the Management is hopeful that Company will register a
considerable growth rate in future as the Corporate. The Company is working rapidly and
looking forward for opportunities to grab more and more business and develop its business
activities in such a way by minimizing its risk of losing business through others, the
positive results of which will be seen in the years to come.
The usage of Aluminium Composite Panels (ACPs) for building facades and
interiors is catching up internationally. ACP Panels have made tremendous strides in India
in the last ten years, one of the most significant growing markets in the Asia pacific
area after China.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:
The company has adequate, proper and well placed Internal Financial
Control System, which ensures that all the assets are safeguarded, and all the
transactions are authorized, recorded and reported correctly in a timely manner.
Internal Auditors comprising of professional firms of Chartered
Accountants have been entrusted to conduct regular internal audits and report to the
Management, the lapses, if any. Both Internal Auditors and Statutory Auditors
independently evaluate the adequacy of Internal Control System. Based on the Audit
observations and suggestions, follow-up, remedial measures are being taken including
review and increase in the scope of coverage, if necessary.
Independence of the Audit and Compliances is ensured by direct
reporting of Internal Auditors to the Audit Committee of the Board. The Audit Committee of
Directors in its periodical meetings, review the adequacy of Internal Financial Control
System and procedures and suggest areas of improvement.
HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT:
As on March 31, 2023, the company had 373 permanent employees at its
manufacturing plant, administrative office and Sales Force. The Company considered their
employees as the most important assets. The Company continued to put in place people
friendly policies and practices in the past year and continues to focus on adopting best
practices for its HR policies. The Company also has a strong focus on ensuring that
employees are adequately trained in their job functions. The Company always believes in
the ideology of team building and Employees welfare. The HR function also ensures all
statutory compliances with labour laws and other relevant statutes and ensures that strong
background screening standards are in place to minimize any risk of fraud from incoming
employees.
Financial Review
DETAILS OF SIGNIFICANT CHANGES (i.e., CHANGE OF 25% OR MORE AS COMPARED
TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED
EXPLANATIONS THEREOF, INCLUDING
| Ratio |
FY 22 - 23 |
FY 21 - 22 |
Change (%) |
Reason |
| Interest Coverage Ratio |
1.04 |
0.63 |
66.43% |
(i) |
| Debt -Equity |
0.55 |
0.35 |
54.49% |
(ii) |
| Net Profit Margin (%) |
3.02 |
6.07 |
(50.17%) |
(iii) |
| Return on Net Worth |
9.97 |
14.60 |
(31.74%) |
(iv) |
| Operating Profit Margin (%) |
6.02 |
10.60 |
(43.21%) |
(v) |
| Debtors Turnover |
10.38 |
8.68 |
19.60% |
|
| Total Debts to Total Assets Ratio |
0.25 |
0.17 |
43.11% |
(vi) |
| Long Term Debts to Working Capital |
0.16 |
0.18 |
(12.52%) |
|
| Inventory Turnover ratio |
2.12 |
1.63 |
30.11% |
(vii) |
(i) There is an improvement due to Repayment of Debt.
(ii) The ratio has changed due to increase in short term borrowings.
(iii) The ratio has changed due to reduction in the profit because of
fluctuation in raw material prices. (iv) The ratio has changed due to reduction in profit
of the company.
(v) The ratio has changed because of reduction in profit because of
fluctuation in the prices of raw material. (vi) The ratio has changed due to increase in
short term borrowings.
(vii) The ratio has changed due to company is able to sell its goods
quickly due to considerable demand.
CAUTIONARY STATEMENT
Statements in the management discussion and analysis report describing
the Companys objectives, projections, estimates and expectations may be "forward
looking statements" within the meaning of applicable laws and regulations and
futuristic in nature. Actual performance may differ materially from those either expressed
or implied. Such statements represent intentions of the management and the efforts put
into to realize certain goals. The success in realizing these depends on various factors
both internal and external. Investors, therefore, are requested to make their own
independent judgments.
| By Order of the Board of Directors |
| For Euro Panel Products Limited |
| Rajesh Nanalal Shah |
| Chairman & Managing Director |
| (DIN: 02038392) |
| Place: Mumbai |
| Date: May 26, 2023 |
+91-9892691696
