Please note that disclosures given in this Annexure - Management
Discussion and Analysis (MD&A) are meant to ensure that there is transparency in
Companys financial performance. They enable our investors to evaluate the Company
and make informed investment decisions. Financial statements alone are not sufficient to
judge a Companys current performance and predict the future performance. The
ordinary investor needs narrative explanations to have a better understanding of the
performance and the environment in which the firm operates. MD & A fulfills this
objective. It gives the investor an opportunity to look at the Company through the eyes of
management by providing both a short and long-term analysis of the business of the
Company.
Some statements in this discussion describing the projections,
estimates, expectations or outlook may be forward looking. Actual results may, however,
differ materially from those stated, on account of various factors such as changes in
government regulations, tax regimes, economic developments within India and the countries
within which your Company conducts its business, exchange rates and interest rates
fluctuations, impact of competition, demand and supply constraints, etc.
BITUMEN INDUSTRY SCENARIO
Indian Bitumen Market Outlook - 2026
The India bitumen market was valued at $2.8 billion in 2018, and is
projected to reach $3.6 billion by 2026, growing at a CAGR of 2.8% from 2019 to 2026.
Bitumen is a black to dark brown sticky material, composed principally
of high molecular weight hydrocarbons. It is a semi-solid hydrocarbon product of crude oil
distillation, which is produced by removing the lighter fractions (such as liquid
petroleum gas, petrol, and diesel) from heavy crude oil during the refining process. The
physical properties of bitumen include adhesion, resistance to water, hardness and higher
softening point.
The growth of Indian bitumen market is majorly driven by increase in
road and building construction activities. Construction of various national highways,
expressways, and airport runways boosts the demand for bitumen across the country. Bitumen
is processed into asphalt for road construction. In addition, rise in investments by the
government for the development of national highways and expressways, which include
projects relating two-laning of highways, the National Highways Development Project,
six-laning of crowded stretches of the Golden Quadrilateral, a special program for the
development of road connectivity in naxal affected areas, development of Vijayawada-Ranchi
road, and for providing last mile connectivity, is anticipated to drive the growth of the
market. Furthermore, bitumen is widely used in the construction industry for roofs, owing
to its physical properties such as adhesion, resistance to water, hardness, ductility, and
higher softening point. Therefore, growth in the construction industry due to growth in
population across the cities and demand for new houses led to increase in demand for
bitumen across the country. In addition, government initiatives such as Pradhan Mantri
Awas Yojana (PMAY) that includes construction of houses for poor people living in both
rural and urban areas is likely to increase the demand for bitumen; thereby, driving the
growth of the India bitumen market.
However, human health & environmental issues associated with
bitumen, fluctuating international crude oil prices, and increase in use of alternative of
bitumen such as concrete in roadway construction applications are expected to restrain the
growth of the market. Moreover, development of bio-based bitumen and EME (Enrob?s ?
Module Elev?) binder is anticipated to provide lucrative opportunities for further
development of the market.
The Indian bitumen market size is segmented on the basis of type,
end-use industry, and region. Depending on type, the market is classified into paving
grade bitumen, oxidized bitumen, polymer modified bitumen, and bitumen emulsions. By
end-use industry, it is classified into road construction, waterproofing, and others.
Region wise, it is analyzed across North India, East India, Northeast India, South India,
and West India.
The major key players operating in the Indian bitumen market besides Agarwal
Industries Corporation Ltd, include Indian Oil Corporation Ltd., Hindustan Petroleum
Corporation Limited, Bharat Petroleum Corporation Ltd., Oil & Natural Gas Corporation
Ltd., Total India, Tiki Tar Industries India Ltd, Juno Bitumix Pvt Ltd., Universal
Bituminous Industries Pvt. Ltd., and Swastik Tar Industries. Other players operating in
this market include Hincol, Jalnidhi Bitumen Specialities Pvt. Ltd., OOMS Polymer Modified
Bitumen Pvt Ltd., Sapco, and UFTI. These major key players are adopting different
strategies such as joint venture, agreement, and business expansion to stay competitive in
the Indian market.
Indian Bitumen Market, By Region – 2026
North India, East India, Northern India, West India & South India
North India would exhibit an CAGR of 3.4% during 2019-2026.
North India accounted for the major India bitumen market share in 2018,
owing to major road network development initiatives undertaken by the Government of India
(GoI) in the North India Region, which include national highways projects in Uttar Pradesh
and Punjab. In addition, maintenance and repair of rural roads constructed under Pradhan
Mantri Gram Sadak Yojana (PMGSY) in Haryana, Rajasthan, Uttarakhand, and Himachal Pradesh
is anticipated to increase the demand for bitumen across these states; thereby, driving
the growth of the bitumen market across North India.
Indian Bitumen Market, By Type
Paving Grade Bitumen is projected as the most lucrative segment.
Paving grade bitumen segment accounted for the major share in 2018,
owing to growth in road construction development activities across the country. Government
projects such as Bharatmala, various national highway projects, and construction of
various economic corridors in different states fuel the demand for bitumen emulsion across
the country. In addition, initiatives launched by Government of India for construction of
roads in rural areas such as Pradhan Mantri Gram Sadak Yojana (PMGSY) and upgradation,
maintenance, and repair work of existing rural roads, national highways, and expressways
are likely to boost the demand for bitumen across India; thereby, driving the India
bitumen market growth.
India Bitumen Market, By End-Use Industry
Road Construction is projected as the most lucrative segment.
Depending on end-use industry, the road construction segment accounted
for the major market share .The road construction segment includes national highway, state
highway, rural roads, and airport runways. Government has initiated various road projects
that include construction of various national and state highways, expressways, and
airports to boost the infrastructural activities. In addition, to connect the rural areas
of the country to the cities the government has launched initiatives like Pradhan Mantri
Gram Sadak Yojana that provide good all-weather roads. This factor is anticipated to drive
the growth of the market.
Key Benefits for Indian Bitumen Market:
• The India bitumen market analysis covers in-depth information of
major industry participants.
• Porters five forces analysis helps analyze the potential
of buyers & suppliers and the competitive scenario of the industry for strategy
building.
• Major countries have been mapped according to their individual
revenue contribution to the regional market.
• The report provides an in-depth analysis of the India bitumen
market forecast for the period 2019-2026.
• The report outlines the current India bitumen market trend and
future estimations of the market from 2018 to 2026 to understand the prevailing
opportunities and potential investment pockets.
• The key drivers, restraints, and India bitumen market
opportunity and their detailed impact analysis is elucidated in the study. Construction of
various national highways, expressways, and airport runways boosts the demand for bitumen
across the country. Bitumen is processed into asphalt for road construction. In addition,
rise in investments by the government for the development of national highways and
expressways, which include projects relating two-laning of highways, the National Highways
Development Project, six-laning of crowded stretches of the Golden
Quadrilateral, a special program for the development of road connectivity in naxal
affected areas, development of Vijayawada-Ranchi road, and for providing last mile
connectivity, is anticipated to drive the growth of the market. Furthermore, bitumen is
widely used in the construction industry for roofs, owing to its physical properties such
as adhesion, resistance to water, hardness, ductility, and higher softening point.
Therefore, growth in the construction industry due to growth in population across the
cities and demand for new houses led to increase in demand for bitumen across the country.
In addition, government initiatives such as Pradhan Mantri Awas Yojana (PMAY) that
includes construction of houses for poor people living in both rural andurban areas is
likely to increase the demand for bitumen; thereby, driving the growth of the Indian
bitumen market. However, human health & environmental issues associated with bitumen,
fluctuating international crude oil prices, and increase in use of alternative of bitumen
such as concrete in roadway construction applications are expected to restrain the growth
of the market. Moreover, development of bio-based bitumen and EME (Enrob?s ? Module
Elev?) binder is anticipated to provide lucrative opportunities for further development
of the market.
Key Benefits for Indian Bitumen Market:
• The India bitumen market analysis covers in-depth information of
major industry participants.
• Porters five forces analysis helps analyze the potential
of buyers & suppliers and the competitive scenario of the industry for strategy
building.
• Major countries have been mapped according to their individual
revenue contribution to the regional market.
• The report provides an in-depth analysis of the India bitumen
market forecast for the period 2019-2026.
• The report outlines the current India bitumen market trend and
future estimations of the market from 2018 to 2026 to understand the prevailing
opportunities and potential investment pockets.
• The key drivers, restraints, and India bitumen market
opportunity and their detailed impact analysis is elucidated in the study.
(*Adopted from Allied Market Research reports)
OUR OPERATIONS – BUSINES SEGMENTS
The Company primarily belongs to Ancillary Infra Industry and is
engaged in the business of (i) manufacturing and trading of Bitumen and Allied products
used heavily in infrastructure projects (ii) providing Logistics for Bulk Bitumen and LPG
through its own Specialized Tankers and (iii) also generates power through Wind Mills.
These businesses are of seasonal nature due to which revenue gets varied
MANUFACTURING OF BITUMEN & BITUMINOUS PRODUCTS
The Company has its manufacturing and storage units at Taloja, Belgaum,
Baroda, Hyderabad, Cochin (through its wholly owned subsidiary – Bituminex Cochin
Private Limited) and at recently added unit at Pachpadra City, Dist. Barmer, (Rajasthan).
Further, the Company has started full fledged operations at its recently established
manufacturing and storage facilities of Bitumen and other value added Bituminous products
at Guwahati, Assam and which would endeavor to expand and develop Bitumen trade in Eastern
states as Bitumen is extensively used in infrastructure projects more specifically in road
construction projects initiated by the State Government.
BULK BITUMEN STORAGE FACILITIES
The Company has Bulk Bitumen Storage facilities to effectively handle
and market bitumen imports at Mumbai, Maharashtra , Vadodara, Gujarat, Karwar, Haldia,
West Bengal, Dighi ( Company Owned), Maharashtra , Hazira ( Loading ) and Mangalore.
BULK BITUMEN TRANSPOTATION
We are the pioneers of logistics in Bitumen, which is predominantly
used in road construction business. It can be procured either in bulk or in packed form.
In either case the product has to be dispatched to the construction site or to the storage
facilities of our industrial consumers. The bulk bitumen is transported via specially
designed tankers that are insulated and have pumping facility for loading and unloading
the bitumen. Most of our Bitumen tankers are under contract with major oil companies in
India like HPCL, BPCL and IOCL and by other major consumers of the product.
BULK LPG TRANSPOTATION
We are amongst the leading transporters of LPG in India, which is the
most widely used fuel for domestic as well as industrial purposes. While we already own a
large fleet of tankers, we also hire tankers on long term contracts to cater to the demand
from customers LPG is mainly sourced from domestic refineries and via bulk imports.
Bulk LPG is mainly transported from the source to the industrial user
or to their bottling plants through specially designed tankers LPG, being highly
inflammable, require tankers that take care of all safety aspects while loading,
transporting and unloading. Most of the LPG tankers are under contract with major oil
companies like HPCL, BPCL and IOCL.
POWER GENERATION THROUGH WIND MILLS
The Company has diversified into Non-Conventional energy generation by
installing wind mills at Rajasthan and Maharashtra, keeping in view of the likely shortage
of energy resources in future. Your Company has one Windmill at Dhulia, Maharashtra and
one in Jaisalmer, Rajasthan.
AUTHORIZED SERVICE CENTRE OF ASHOK LEYLAND
We own a large fleet of tankers which necessarily calls for regular
periodic checks and maintenance. As also, our entire fleet of tankers comes from the Ashok
Leyland stable. Both these factors influenced our decision to set up an authorized service
center, for Ashok Leyland vehicles, within the company. Not only does this ensure a timely
turnaround of the fleet serviced but is an economically beneficial proposition for the
company. We have our own workshop and maintenance facilities at strategic locations like
Mumbai, Baroda and Jodhpur.
FINANCIAL PERFORMANCE AND OPERATIONS
Major indicators of your Companys financial performance for the
F.Y ended March 31, 2023 are presented in the accompanying Audited Financial Statements.
These financial statements have been prepared in accordance with the Indian Accounting
Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015
as amended by the Companies (Indian Accounting Standards) (Amendments) Rules, 2016. The
Company has adopted Ind AS from April 01, 2017 for the first time and accordingly these
financial results are Ind AS 101 (First Time Adoption of Indian Accounting Standards)
compliant.
RESULTS OF OPERATIONS (Standalone)
The total Revenue of the Company for the Financial Year ended March 31,
2023, is Rs. 177685.67 Lakhs as compared previous years total Revenue of Rs.
141486.17 Lakhs thus indicating an increase of 25.59% over the previous year.
Further, Profit before Tax and Profit after Tax were Rs. 6636.91 Lakhs
and Rs. 4934.64 Lakhs respectively during the year under review as against Rs. 5212.97
Lakhs and Rs. 3856.52 Lakhs in the corresponding previous year, reporting an increase of
about 27.32% and 27.96% over the previous financial year.
DIVIDEND
Your Directors have recommended a dividend of Rs. 2.50 per equity share
of the face value of Rs.10/- each fully paid up for the financial year ended March 31,
2023. The dividend distribution is subject to approval of the members of the Company at
the ensuing Annual General Meeting.
Pursuant to the amendments introduced by the Finance Act, 2020 the
Company will be required to withhold taxes at the prescribed rates on the dividend paid to
its shareholders w.e.f. 1st April 2020. No tax will be deducted on payment of dividend
to the resident individual shareholders if the total dividend paid does not exceed Rs.
5,000/-. The withholding tax rate would vary depending on the residential status of
the shareholder and documents registered with the Company.
SHARE CAPITAL
Issued and Paid up Capital of the Company is comprised of 1,49,57,789
Equity Shares of Face Value of Rs.10/ each amounting to Rs.14,95,77,890 /- as on date.
During the year under review, the Company has converted last and final
tranche of 17,49,000 Warrants (including both promoter group and public ) into equal
number of fully paid up Equity Shares viz. 17,49,000 Equity Shares of the F.V of Rs 10/-
each at an Issue Price of Rs.105.20/- (including premium) aggregating to Rs.
13,79,96,100/- (remaining 75% of Rs.105.20/-) out of total 35,11,000 Warrants allotted
under the Public and Promoter Category earlier in accordance with Chapter V of the SEBI (
ICDR) Regulations , 2009 as amended, the Board Resolution dated January 15, 2021 and
Special Resolution dated February 10, 2021. These newly allotted Equity Shares have been
listed on BSE and NSE. With this final tranche of conversion, the Company has completed
its Preferential Issue of Warrants in accordance with Chapter V of the SEBI (ICDR)
Regulations, 2009 as amended. The entire Equity
Shares allotted post conversion are listed on BSE & NSE.
Further, entire funds raised under the said Preferential Issue have
been utilized strictly in accordance with the objects of the issue which inter alia,
included: repayment of debt, capital expenditure, investments and meeting working capital
requirements.
AMOUNT TO BE CARRIED TO OTHER EQUITY
The Company has transferred Rs. 28275.10 Lakhs to the Other
Equity for the F.Y. March 31, 2023 after appropriating Rs. 289.15 Lakhs towards
dividend paid for the F.Y. ended March 31, 2022.
CAPITAL EXPENDITURE
As at March 31, 2023, the Capital Expenditure during the year under
review amounted to Rs.1021.39 Lakhs including Work in Progress (WIP) amounted to
Rs. 408.32 Lakhs.
SEGMENTWISE/PRUDUCTWISE PERFORMANCE
For Segment wise/ Product wise performance of the Company, please refer
to Financial Statements of the Company.
AUDITED CONSOLIDATED FINANCIAL STATEMENTS
The Audited Consolidated Financial Results for the F.Y ended on March
31, 2023 include the financial results of its Wholly Owned Subsidiary (WOS) Companies- (i)
Bituminex Cochin Private Limited, and (ii) AICL Overseas FZ-LLC and (iii) Agarwal
Translink private Limited These Audited Financial Results have been prepared in accordance
with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting
Standards) Rules, 2015 as amended by the Companies nancial costs.
(Indian Accounting Standards)(Amendments) Rules, 2016. During the
reporting year 2022-23 the Company has incorporated a Wholly Owned Subsidiary viz. AICL
Finance Private Limited on 20th January 2023, which havent started its business yet
due to pendency of Regulatory permission, hence not forming part of Consolidated Financial
Statement.
OUR STRENGTHS
Indias first largest Bitumen Company in Private Sector.
• Promoters with profound Industry Experience of 38 plus years.
• Well diversified Company: Manufacturing & Trading of
•Bitumen and other value added products; Transportation of Bulk
Bitumen & LPG: Power Generation through Wind Mills.
• Bulk Bitumen Storage facilities near ports for effective and
optimum handling of bitumen imports.
• Consistently Dividend Paying Company
• Bitumen manufacturing is our finest forward integration and is
an extension of our parent Business i.e. Bitumen Bulk Transportation.
• Strong Suppliers & Client relationship continuing for past
many years.
Comprehensive consolidated financial Strength through Wholly Owned
Subsidiary Companies incorporated in UAE under the name "AICL OVERSEAS" in Ras
AI Khaimah Economic Zone (RAKEZ) in United Arab Emirates (UAE) for undertaking various
ship/vessel /ocean related activities and already existing Wholly Owned Subsidiary Company
named Bituminex Cochin Private Limited. Post financial year ended March 31, 2021, Agarwal
Translink Private Limted (ATPL) , a group Company, in lieu of purchase of the entire
equity holding of all the Members of the said group Company, became Companys wholly
owned subsidiary Company (WOS).
• Our above overseas WOS owns fleet of 5 (Five) large Vessels
having total capacity of 29,500 MT which are used in importing raw bitumen from oil
producing countries. The economies we achieve with our own fleet of marine vessels and
road transport vehicles enable your Company to outbid competitors, secure tenders and
ensure high standards of supply and services to its valued customers.
• Cost Advantages through bulk imports.
• Being amongst the largest fleet operators of specialized Bitumen
and LPG Tankers in the country adds to customer comfort and ensures supply reliability.
• Market share gain over the years, spurred by superior product
quality and increased customer satisfaction though no identified identical business peer.
• Majority of our manufacturing facilities are ISO Certified.
• All major capex till date from capital infusion and internal
accruals so far thus improving bottom line throughsaving
• Benefits of Listed Company - Capital appreciation, liquidity and
transparency of operations..
• Geographically well located Company in different parts of the
country.
For details, please refer to relevant sections of Directors
Report.
OUR CHALLENGES
• Imports – Shipments at Right time, Right Pricing, Quality
Material.
• Pricing – Competition with other players in the Industry.
• Continuous development of Infrastructure Sector.
• Timely payment to our clients from the related government
authorities.
• Cost reduction/cost minimization through consistent guidance and
motivational efforts. at all
• levels of operations
OUR OPPORTUNITIES
• Directly related to Infrastructure projects which are under
Govts priority agenda.
• Endless opportunities for expansion of Bitumen Products as road
construction within the ambit of infrastructural growth.
• Tremendous scope for developing Value Added Products with
potential of higher margins.
• Huge deficit in bitumen indigenous supply and demand leaving
tremendous scope for imports
• Huge deficit in power demand and power supply leaving tremendous
scope for expansion of Wind Power Mills
• Having own manufacturing plants and bulk imports minimize
dependency on oil Companies.
OUR THREATS
There are no major business / industry threats before us as ours is a
well-diversified and fundamentally strong
Company with clear vision for future growth and prosperity and is under
priority infrastructure sector. However, there are some factors which are beyond the
control of the
Company viz. impact due to fluctuations in the economy caused by
changes in global and domestic economies, competition in the industry, changes in
government policies and regulations, fluctuations in interest rates etc. which are common
to all sectors, so we are no exception. Nevertheless, your Company ensures all safeguards
to combat any such eventuality .to the best of its ability and vast industry experience.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company has in place an adequate system of internal controls, with
documented procedures covering all corporate functions. Systems of internal controls are
designed to provide reasonable assurance regarding the effectiveness and efficiency of
operations, the adequacy of safeguards for assets, the reliability of financial controls,
and compliance with applicable laws and regulations. The Audit Committee of the Board
oversees the adequacy of the internal control environment through regular reviews of the
audit findings and monitoring implementations of internal audit recommendations through
the compliance reports submitted to them.
MANPOWER
Your Company is committed to attract, develop and retain high quality
talent. We promote culture of higher commitment and entrepreneurial approach across all
over management positions to foster organizations growth. During the year under
report, your Company maintained harmonious and cordial industrial relations with its staff
and employees.
PROTECTION OF WOMEN AT WORK PLACE
The Company has formulated a policy on ‘Protection of Womens
Rights at Workplace as per the provisions of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition & Redressal) Act, 2013.
There were no cases of sexual harassment received by the Company in
2022-23 & between the end of the financial year and the date of this Report.
SAFETY, HEALTH AND DEVELOPMENT
Safety, health and development of human resources is our paramount
objective and your Company actively pursues measures to sustain and improve the same on
regular basis.
MANAGEMENT INFORMATION SYSTEMS (MIS)
Effective Management Information Systems are core to any successful
business and your Company is supported and empowered by installing updated and advanced
MISs to be in forefront of this competitive industry.
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