amines plasticizers ltd share price Management discussions

There is one and only one Social responsibility of business - "to use its resources and engage in activities designed to increase its profits" - Milton Friedman.

It has now been 50 years and your Company and its Management is continuously striving to fulfill the aspiration of its various stakeholders including employees, customers and communities. The view expressed by the Economist Friedman has long influenced Management thinking, Corporate Governance practices and devising and implementation of policies. The result is evident from the fact that from a turnover of 48 Crores in the year 1998 (25 years of operations) it has now touched to 595 Crores in 2023 and Profits are at 20.86 Crores from a loss of 3.5 Crores/- in the year 1998.

The Management believes every Corporate has a purpose which centered on the idea of improving performance and ultimately healthier Corporates meant a healthy Society. The Management acts as the backbone of Corporate Governance playing a vital role in running Companies smoothly. They make important decisions, ensuring fairness and openness and looking out for everyone involved and are also responsible for making sure that the Company follows the rules, behaves ethically and takes care of all the people involved. Good Management creates a healthy work environment and helps the Company grow sustainably keeping everyones interests in mind.

ECONOMIC OVERVIEW :

GLOBAL ECONOMY AND OUTLOOK

The previous year remained turbulent for the global economy. Conflict, inflation, food supply crisis and the long trail of Covid-19 Pandemic have caused intermittent shockwaves across the world. The global economy continues to face steep challenges, shaped by the lingering effects of three powerful forces: the Russian invasion of Ukraine, a cost-of-living crisis caused by persistent and broadening inflation pressures, and the slowdown in China. Russias invasion of Ukraine continues to destabilize the global economy. Persistent and broadening inflation pressures have triggered a rapid and synchronized tightening of monetary conditions, alongside appreciation of the US dollar against most other currencies. Tighter global monetary and financial conditions will work their way through the economy, weighing demand down and helping to gradually subjugate inflation. So far, however, price pressures are proving quite stubborn and a major source of concern for policymakers. In China, the frequent lockdowns under its Zero COVID policy have taken a toll on the economy, especially in the second quarter of 2022. The external environment is already very challenging for many emerging market and developing economies. The sharp appreciation of the US dollar adds significantly to domestic price pressures and to the cost-of-living crisis for these countries. The risk of monetary, fiscal, or financial policy miscalibration has risen sharply at a time when the world economy remains historically fragile and financial markets are showing signs of stress. Increasing price pressures remain the most immediate threat to current and future prosperity by squeezing real incomes and undermining macroeconomic stability. Central banks around the world are now focused on restoring price stability and the pace of tightening has accelerated sharply. There are risks of both under and over-tightening.

Global growth is projected to fall from an estimated 3.4 percent in 2022 to 2.9 percent in 2023, then rise to 3.1 percent in 2024. The forecast for 2023 is 0.2 percentage point higher than predicted in the October 2022 World Economic Outlook (WEO) but below the historical (2000-19) average of 3.8 percent. The rise in central bank rates to fight inflation and Russias war in Ukraine continue to weigh on economic activity. The rapid spread of COVID-19 in China dampened growth in 2022, but the recent reopening has paved the way for a faster-than- expected recovery. Global inflation is expected to fall from 8.8 percent in 2022 to 6.6 percent in 2023 and 4.3 percent in 2024, still above pre-pandemic (2017-19) levels of about 3.5 percent.

The balance of risks remains tilted to the downside, but adverse risks have moderated since October 2022. On the upside, a stronger boost from pent-up demand in numerous economies or a faster fall in inflation are plausible. On the downside, severe health outcomes in China could hold back the recovery, Russias war in Ukraine could escalate, and tighter global financing costs could worsen debt distress. Financial markets could also suddenly reprice in response to adverse inflation news, while further geopolitical fragmentation could hamper economic progress.

INDIAN ECONOMY AND OUTLOOK

Indias growth continues to be resilient despite some signs of moderation in growth, as per the World Bank. Although significant challenges remain in the global environment, India is one of the fastest growing economies in the world. The overall growth remains robust and is estimated to be 6.9 percent for the full year with real GDP growing 7.7 percent year-on-year during the first three quarters of fiscal year 2022/23. There were some signs of moderation in the second half of FY 22/23. Growth was underpinned by strong investment activity bolstered by the governments capex push and buoyant private consumption, particularly among higher income earners. Inflation remained high, averaging around 6.7 percent in FY22/23 but the current- account deficit narrowed in last 2 quarters on the back of strong growth in service exports and easing global commodity prices.

The World Bank has revised its FY23/24 GDP forecast to 6.3 percent from 6.6 percent (December 2022). Growth is expected to be constrained by slower consumption growth and challenging external conditions. Rising borrowing costs and slower income growth will weigh on private consumption growth, and government consumption is projected to grow at a slower pace due to the withdrawal of pandemic-related fiscal support measures.

The Indian economy however continues to show strong resilience to external shocks. Notwithstanding external pressures, Indias service exports have continued to increase as also the domestic consumption.

Although headline inflation is elevated, it is projected to decline to an average of 5.2 percent in FY23/24, amid easing global commodity prices and some moderation in domestic demand. The Reserve Bank of India has withdrawn accommodative measures to rein in inflation by hiking the policy interest rates. Indias financial sector also remains strong, buoyed by improvements in asset quality and robust private-sector credit growth.

The Central Government is likely to meet its fiscal deficit target of 5.9 percent of GDP in FY23/24 and combined with consolidation in state government deficits, the general government deficit is also projected to decline. As a result, the debt-to-GDP ratio is projected to stabilize. On the external front, the current account deficit is projected to narrow to 2.1 percent of GDP from an estimated 3 percent in FY22/23 on the back of robust service exports and a narrowing merchandise trade deficit.

BUSINESS OVERVIEW

The Chemical industry plays a crucial role in sustenance and growth of other industries and thus in economic revival. Your Company provides a variety of products required as base in the production of many pharma, medical supplies, textiles, petro-chemicals and other chemical industries. As reported earlier, manufacturing of MDEA, Speciality Chemicals, Oilfield Chemicals, Demulsifiers, Acid corrosion inhibitors continues to grow during the year under review. In the field of EA and Alkyl Alkonolamines, the Company continues to cater approx 70% of the total demand of the Indian market and has been regularly exporting its products to many Countries. As reported earlier, the Company continues to be associated with many industries which include Oil and gas, electronics chip manufacturing, Textile auxiliary Chemicals and Pharmaceutical Companies. The expansion of its Ethoxylation/Propoxylation capacity has been completed to manufacture certain specialty chemicals.

The Company in order to reduce power cost and to ensure smooth flow of energy requirement had invested in a Company - Radiance MH Sunrise Six Private Limited, which is engaged in the business of development, construction, operation and maintenance of solar power plants in India and developing, constructing ground mounted, grid connected solar (photovoltaic) electric generating facility. The power producer has commissioned its Solar Power Plant which is now fully operational and the Companys power requirement to a certain portion has been met with seamless supply of power through Alternate Source of energy at a concessional rate.

Our Customers : -

The Companys association continues with all Public Sector Oil Companies / Refineries and Petrochemical Industries. The Companys products continue to be used in the Textile and manufacturing of Electronic chips. The Company has ventured into other activities like manufacture of Amine Reclamation Units. These Amine Reclamation Units are used for revamping the amines by removing the heat stable salts formed in the amine during use giving the amine a longer life for reuse on the refinery. During the year under review, the Company has delivered one such large Unit to a major Refinery in India.

SUBSIDIARY COMPANIES PROGRESS :

AMINES AND PLASTICIZERS FZ LLC :

The Companys wholly owned subsidiaryAmines and Plasticizers FZ LLC in Ras Al Khaimah, Free Trade Zone in UAE has now started to deal in the products manufactured by the Company and by other manufacturers.

International Organization for Standardization (ISO) Compliance :

The Company has ISO quality management system certification since last two decades. Over a period of time, it has achieved and upgraded to Quality ISO 9001: 2015 which is valid till 11^th January 2024, Environment ISO 14001: 2015 is valid up to 08th April, 2025 and Occupational Safety Management System ISO 45001: 2018 which is valid up to 06^th June, 2025.

Details of the above mentioned certifications are elaborated in the Directors Report.

TfS (Together for Sustainability): As reported earlier, APL had joined TfS (Together for Sustainability) forces by successfully going through TfS Assessment and Audit conducted by TfS approved Auditing Agency. This helps to increase transparency with regard to sustainability standards in supply chains. The mission is to support in managing complexity and risks in increasingly global operations and improving the economic, social and ecological conditions in global supply chains by engaging in dialogue with the suppliers.

Further, the Companys registration under REX (Registered Exporter) continues for obtaining concessional duty for imports from India to European Union, Norway, Switzerland and Turkey. EFfCI GMP (European Federation of Cosmetic Ingredients - Good Manufacturing Practices): APL has successfully gone through verification of compliance to EFfCI GMP, 2017 standard for some of its products which is the essential requirement of few global Cosmetic manufacturing customers.

In addition to above, the Company has HALAL & KOSHER Certifications for few of its products.

GREEN INITIATIVE :

Pursuant to MCA circulars, the Annual Report 2022-23 will only be sent through electronic modes to those shareholders whose email IDs are registered. The Shareholders are requested to register their email ID with the Registrar and Share Transfer Agent of the Company if the shares are held in physical form and with their Depository Participants where the shares are held in demat form. As a part of Green Initiative and larger reach, the Annual Report of the Company and all major corporate communication would be uploaded on the Companys website: www.amines.com for information and perusal. A physical copy of Annual Report will be given free of cost once to members on specific request.

E-voting :

Pursuant to the provisions of the Companies Act, 2013 read with rules made there under and the Listing Obligations, the Company has been with the assistance of LinkIntime provided the facility of Evoting through InstaVote and AGM through Video Conferencing (VC) / Other Audio Visual Means (OAVM) with the help of InstaMeet. Detailed procedure for the same is mentioned in the Notes to the Notice of the 48th Annual General Meeting of the Company.

INDUSTRY STRUCTURE AND DEVELOPMENT :

After a strong performance in the last two financial years, specialty chemicals manufacturers have seen margin headwinds in the first nine months of FY23, led by high raw material prices, energy and logistics costs. Caution prevails on global demand considering the recessionary environment in the developed world. Specialty chemicals manufacturers reported a mixed performance with the portfolio related to discretionary sectors remained under pressure. Certain product prices declined sequentially, impacting the margin & performance of domestic manufacturers.

India holds a strong position in chemicals globally, ranking 14th in exports and 8th in imports. Covering more than 80,000 commercial products, the industry is expected to grow at 9.3% to reach US $304 billion by the year 2025. The growth is predicted on the back of rising demands in the end-user segments for specialty chemicals and petrochemicals. The global pandemic and its subsequent disruptive impacts have encouraged many companies to de-risk their supply chains. Increased dependence on a single manufacturing source, rising costs in China, growing US China tensions, stringent environmental, and high compliance costs. have created vulnerabilities that have driven firms to diversify supply chains outside of China. India is uniquely positioned to benefit as MNCs increasingly adopt the China+1 strategy owing to its competitive cost advantage, focus on quality and sustainability, conducive business environment led by reforms, and incentivized government policies. In the post pandemic scenario, the Indian chemical industry has got numerous opportunities considering the supply chain disruption in China and trade conflict among the US, Europe, and China. Additional support, in terms of fiscal incentives, such as tax breaks and special incentives through Petroleum, Chemicals and Petrochemicals Investment Regions (PCPIRs) or Special Economic Zones (SEZs) to encourage downstream units will enhance production and development of the industry. To bring about structural changes in the working of the domestic chemical industry, future investments should not only focus on transportation of fuels such as petrol and diesel, but also on crude-to-chemicals complexes or refineries set up to cater to the production of chemicals. In the face of various global challenges, the Indian chemical industry continued to be resilient in 2022-23 and has shifted gears in the right direction of becoming a noteworthy global player. However, numerous challenges still persist including limited domestic feedstock availability, delayed regulatory approvals, and scarcity of skilled R&D talent. These enablers and obstacles have influenced the spectrum of chemical subsegments falling in the consideration pool, in terms of both market attractiveness and cost competitiveness. India has significant presence in production of basic organic chemicals, fertilizers, pesticides, paints, dyestuffs and intermediates and fine and specialty chemicals. The chemical sector in India faces key challenges such as inadequate infrastructure facilities, high costs of basic raw materials, natural gas and crude oil, high cost of capital and need for technological modernization of its facilities. The key success factors for the chemicals industry in India are the use of advanced technology, strong research capabilities, backward and forward linkages and development of domestic capacity to reduce dependence on imported raw materials. It has also become imperative for the Indian chemical industry to address safety, health and environmental protection issues in an organized manner. A consistent value creator, Indias chemical sector remains an attractive hub of opportunities. Robust demand across end-user industries led by rising domestic consumption, strong export growth, and rising import substitutions are expected to be primary growth drivers for the chemical sector. Growing strong domestic demand and increased exports will continue to fuel the growth of the Indian specialty chemicals industry. The robust performance of the sector is prompting specialty chemical manufacturers to ramp up their production capacity to meet the growing demand for its products. Furthermore, antipollution measures in China will also create opportunities for the Indian chemical industry in specific segments.

COMPANYS OPERATIONAL PERFORMANCE :

During the year under review, the Total Revenue of the Company was 59407.02 Lakhs as compared to 56808.31 Lakhs. The Companys Profit before Tax stood at 2827.90 Lakhs as compared to 3206.02 Lakhs. The Chart depicts the export sale as compared to total sales of the Company over last 3 years.

PRODUCTWISE PERFORMANCE :

During the year under review, due to expanded plant capacities, the Company could focus more on executing big ticket size orders. It continued its efforts on expanding sale of Ethanloamine / Alkanolamines & Derivative products which had contributed over 72% of total sales which is more than 10% compared to previous year. Another revenue contributor remained Morpholine Derivatives and Ethylene Oxide / Propylene Oxide Derivative which contributed around 25%.Both these products have different variants based on their utility and composition.

As reported earlier,yourCompany continued trading of molecularsieves which is used in Industrial Gases,Fuel Ethanol Production, miscellaneous petrochemicals, liquid used in oxygen concentrator, drying agent, packaging industries and polymer processing. Your Company continues to represent one of the biggest Global producers of Molecular Sievesand isamajordistributorin India.

As evident from the results, the growth in Quantitative sales of Alkyl Alkolnamines continued and the realization was better as compared to the previous year and quantitative and value increase of NMMO in the exports sales also reported betternumbers.

RESEARCHANDDEVELOPMENT:

Your Company has an in-house Research and Development Division consisting of experienced professionals which are engaged in development of new products simulations, processes and variants of chemicals useful in different industrial segments & sectors. Also, R&D Division is continuing its efforts to mitigate the impact on environment and climate change by focusing on carbon capture & utilization and green chemistry.

GlobalWarming and Pollution are two major environmental challenges.As reported earlier,in both the cases,our main products MDEA and NMMO play a big role.The R&D developed NMMO product revolutionized the textile industry by manufacturing Lyocil fiber replacing viscose fiber.Our new environment friendly solvent made it possible without any harm to the Environment. Many industries have shifted to this Fibre Technology which had reduced pollution.The Company is now focusing on making raw materials for this product by Green Chemistry and research is in its final stages. Your Company is actively involved with this Sector and is developing many Speciality Solvents based on its productsforuseinthissector.

Our Company is developing products required by many customers in the European Union by the Green Chemistry route. Samples of these products have already been prepared and submitted to the customers for their evaluation and trials.The Companys R&D is actively pursuing decarbonization for the green chemistry and Pharmacy Intermediates. Also, new grade Ethoxylates and Propoxylates products are being developed by R&D industry for use in the Polymer, Resin and foam industry.

The R&D is concentrating on products which are not produced in India and currently being imported so the main focus is to create import substitutes through R&D route in line with the Government policy.The Companys R&D efforts are focusing on certain metal free chemicals which would be required by the Electro chip industry being promoted by the GovernmentofIndia.

In a nutshell,theResearch& Development efforts are focused on:

a) Development of various acrylates base addition products based on propylene oxide & ethylene oxide.

b) Development of glycerin baseaddition productsbasedon propylene oxide & ethylene oxide.

c) Development of customized propylene oxide& ethyleneoxide based export products.

d) Development of Mould Releasing agentforrubberauxiliaryforautomobile industries.

e) Adaptationofrenewable resourcesforenergyfuelandwatersavings.

As a result of sustained efforts on R&D Activities,the Company has been able to derive a number of benefits which are enumerated hereinbelow:

a) Increase growth in domestic and international market for variety of R & D developed and commercialized products.

b) Effectively develop new ethoxylate and propoxylate value added new product range.

c) Variety of products developed gained approval from local and international customers.

d) Substantial Growth in development of specialty product formulation for gas plants benefiting local and global market in refinery,natural gas fertilizer and ammonia plants.

The demand for high quality, high purity,Cosmetic ingredients, metal working fluids, Drug intermediates,Textile auxiliaries,electronic chemicals (all EO/PO- based),rising continuously in the domestic as well as in global markets and we are able to fulfill the stringent requirements of our clients,with our concentrated R&D efforts.The Company also plans to design and develop range of surfactants based on ethylene oxide and propylene oxide. Few of your Companys Emulsifier field products developed inhouse,based on Ethylene Oxide,contributes to Green Chemistry as they are used in neem basedAgrochemicals.

As reported earlier, R&D efforts continue to contribute immensely to various industries including Construction, Automobile,Paints& Coating industries in India as well as across theWorld.

REACH COMPLIANCE:

During theyear,someofyour Companys products were registered under EU Reach Regulations and some substances have received pre-registered recognition under K- Reach Regulations(Korea).In addition to this,the Company has also received Inventory notified recognition underEurasia Reach Regulations forsomeofitssubstancesand Pre-registered recognition for some of its substances underTurkey KKDIKRegulations.As reported earlier,the Company is in process forChina Reach for one ofits products.

OPPORTUNITIES.THREATS.RISKSMANAGEMENT :

Your Company has completed 50 years of operations and has created a brand name for itself and commands Goodwill in the Chemical Sector. It has built an image for itself by proper planning, taking calculated risks and materializing opportunities.This was possible due to exploring various business opportunities and taking initiatives to expand business in various markets.In every business and in every newinitiative,there are inherent risks and itis the duty of the Management to manage such risks. The Chemical industry in which your Company operates is one of the most diversified industries in businesssegment.Diversification provides opportunitiesandalsoposesthreat.

As reported above,the Company has a state of the art in-house R&D Division to combat the risks associated with ever changing needs of the chemical industry.

During the year under review, the Company has focused on development of new products to meet the dynamic demands from different sectors which has been put to various different uses. In house Research and Development facility and adoption of latest technological changes have helped in introducing new specialty custom made products having better margins.Diversification being a major factor for opportunities it also gives mounting pressure to satisfy the ever changing needs of customers.Also,Chemical sector has its inherent element of risk factors ranging from Raw Materialprocurement,storageand plantoperationsafety.

The Chemical sector has now moved from commodity based (sourcing of raw/refined chemicals) to need based manufactured as per the needs and high emphasis is placed on the product development,acquiring new technology and improving production facilities.

For credit risk,the management is careful in its credit policy towards its customers in domestic market and for exports its either advance payment or letter of credit. Your Company has a Brand Name in chemical industry and has the advantage of deeper penetration in market and recognition amongst its peers. Also, due to timely expansion of product facilities and capacities,upgradation of its Multi-product plant resulted in seizing more opportunities which has reflected in overall better performance of the Company even during uncertain economic situation.The Companys adaptability to new product development hasresulted in achieving higher sales during the year under review.

As reported earlier, the Company continues to face competition from domestic and international Chemical manufacturers.The Companys another Multi-product Plant helps to produce variety of products to cater to the needs of different customers.Diversified product portfolio and large customer base continue to be the main strengths of the Company.Your Company being in the manufacturing segment requires certain raw material which are susceptible to fluctuations in prices and they are sensitive in nature and therefore the same cannot be imported. Also, in house production of the same is not financially viable since it will have huge capital expenses. The Company is thus vulnerable to Ethylene Oxide price volatility which in turn is affected by the crude oil prices.Another risk factor which the Company is currently facing is the ever increasing energy prices and high finance cost thereby reducing the companys profitmargin.

The Company has been taking every possible step in order to mitigate the effects of unstable global conditions through reaching out to new customers, exploring new chemical markets and constant efforts by its R&D Team in developing unique and innovative Specialty products to suit its customer needs.Your Company has,also invested in solar power producing Company to ensure smooth flow of electricity at concessional rates.As regards fluctuations in Forex,the Company has natural hedging between exports and imports.

Typesofrisksandmitigatingfactors :

A) EconomicRisk- Global uncertainty,unrestduetowar and slowdown in economy.

Mitigation measure : The petrochemical industries and refineries all over the world started to expand its operations.The Company has strong relations with many customers and continues to penetrate its presence in domestic and global markets.The Company has active R&D division and has a diversified product base to caterto various customers needsworldwide.

B) Operational Risk- Procurement of Raw material,increase denergy cost&competition risk.

Mitigation measure-The Company has always tried to maintain sufficient stock of raw materials and have good business relations with its Suppliers. It ensures required flow of raw material at any given time.The Company has now invested in a Solar Power Company to meet its energy requirements. The Company chose path of Renewable source of energy and reduction in cost too.Your Company has a professional R&DTeam with optimum composition of experience and young talent. The Company continues to develop many products through innovation and research having its utility in many fields. Also, the Company has been providing tailor made solutions to its clients thereby enhancing client satisfaction and retention.The management is constantly trying to tap new markets, for its products. One of the major constraint has been the ever increasing prices of PNG resulting in increasein operational cost.

C) Ecological Risk-With increasing awareness about the Climate change and Global warming; impact on the environment.

Mitigation measure : R&D Division has been focusing on carbon capture & utilization and Green Chemistry.The Company is working on Solvents used in hydrogen industry as detailed in the Research and Development para. Our new environment friendly solvent can make this possible without any harm to the Environment. The Company has now focused on making raw materials for this product by Green Chemistry. All fuel requirements are met byPNG thereby reducing AirPollution.

D) Finance Risk- Availability ofFinanceforworking capital requirements.

Mitigation Measure-The Company has consortium of Bankers and SBI is the lead Banker which have sanctioned Working Capital facilities that ensures smooth flow of finance whenever needed.The Company has also raised money by inviting and accepting unsecured deposits at lesser rate of interest for meeting general corporate requirements.

INTERNALCONTROLSYSTEM :

Your Company has an effective internal control and risk-mitigation system, which is constantly assessed and strengthened with new/revised standard operating procedures. The Companys internal control system is commensurate with its size, scale and complexities of operations. M/s N. J. Mahtani & Co., a Firm of Chartered Accountants are the internal auditors of the Company.The main focus of internal audit is to review business risks, test and review controls, assess business processes besides benchmarking controls with best practices in the industry. During the year under review, there were no elements of risk which in the opinion of the Board of Directors threaten the going concern status of the Company.Risks are an inherent part of any business which are mitigated in accordance with the Risk Management framework. With the ever changing conditions on economic and global front, your Companys internal control system is reviewed from time to time keeping in check the internal financial controls, complianceswithapplicableprovisionsoflaws,policies,statutorycompliances.

The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems. The Audit Committee suggests improvements and utilizes the reports generated from a Management Information System integral to thecontrol mechanism.

The Management has laid down adequate procedures and policies to guide the operations of our business. Unit/Functional Heads are responsible for ensuring compliance with the policies and procedures laid down by the Management. Our internal control systems are periodically reviewed by the Management, Statutory Auditors and Internal Auditors.

HUMANRESOURCEMANAGEMENT:

The Human Resources is an essential component of any business.The Industry in which your Company operates not only demands quality but also in-depth technical knowledge.Your Company has by focusing on its core values ofTrust, Quality,and Excellencebuiltanagile,enthusiasticand energized workforce whichdefinestheorganization culture.

Leadership development focuses on identifying potential and grooming critical talent through various programs. Employees are encouraged to upgrade their skills by regularly attending seminars, webinars, courses, programmes. Your company ensures that employees are aligned with the organizational culture and values whilst never losing sight of our business objectives.Technical and safety training programmesaregiven periodically toworkers.

The Company values its human resourceand their invaluable contribution to theCompany as well as to the Nation.The total number of employeesonconsolidated basis as on 31 March,2023 stood at 402.

During the year under review,theIndustrial relationsatall levels remainedcordial.

Your Company also continues to endeavor to create a work environment which is collaborative,learning and growth oriented to enable employees to perform at their full potential and Human Resource (HR) strategy adopts a multipronged approach covering all the key facets of employee development. Learning as a stated value of the Company also sets the tone of your Companys aim to develop competencies to rise to new challenges. Employee contribution to the Company has enabled us to maintain its leadership position in chemical segment. Nurturing peopleisa keyorganizationalgoal and leadership mandate.

FINANCIALPERFORMANCE :

During the year under review,the Company registered around 4.57% growth inTurnover,however Net profit declined by 12.15 % on a Standalone basis.The Company witnessed a slight increase of Turnover and Revenue from Export as compared to previous year.The contribution of Export was approx.47.41 % in the total turnover during the year under review.

( in Lakhs)

FINANCIAL RESULTS	2022-2023	2021-2022
Total Income	59407.02	56808.31
Total Expenditure	55124.25	52298.07
Profit before Finance Cost, Depreciation and Tax	4310.30	4,523.74
Less :
Depreciation	483.43	439.37
Finance Cost	999.27	878.35
Profit Before Tax & Exceptional Item	2827.90	3206.02
Less Exceptional Item	-	-
Profit Before Tax	2827.90	3206.02
Tax Expense	741.75	831.33
Profit After Tax	2086.15	2374.69

During the year, the total income of the Company stood at 59407.02 Lakhs as compared to ?56808.31 Lakhs in the previous year.The total expenditure increased by 5.40 % and stood at 55124.25 Lakhs as compared to 52298.07 Lakhs in the previousyearand NetProfitwas 2086.15Lakhsascomparedto2374.69 Lakhs.

SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS (Standalone):

Key Financial Ratios	FY 2022-23	FY 2021-22	Change%	Reasons for change
EBIDTA Margin %	7.27	8.04	(10.59)	Reduction is due to increase in material cost and gas Prices.
Operating Profit Margin %	6.41	7.23	(11.34)	Reduction is due to huge increase in operational cost.
Profit before Tax Margin % (PBT)	4.77	5.7	(16.32)	Reduction is due to lower operating margin.
Profit after Tax Margin % (PAT)	3.52	4.22	(16.59)	Reduction is due to lower operating margin.
Return on NetWorth%	11.52	14.59	(21.04)	Reduction is due to fall in Profit
Debt Equity Ratio	0.47	0.44	6.82	Higher utilization of Debt.
Return on Investment	12.14	15.63	(22.32)	Due to reduction in profit
Return on Equity Ratio	12.14	15.63	(22.32)	Due to reduction in profit

RESULTS OF OPERATIONS : ( in Lakhs)

Income	Year ending 31.03.2023	Year ending 31.03.2022
Income from sale of products (Gross)	59,137.53	56,159.98
Sale of Services - Engineering	167.05	130.79
Export Incentives	0.29	(1.86)
Other Income	102.15	519.40
Total Income	59,407.02	56,808.31

FORWARDLOOKINGSTATEMENTS :

Certain statements in the Report regarding our business operations may constitute forward-looking statements. These include all statements other than statements of historical facts ,including those regarding the financial position, business strategy, management plans and objectives for future operations.

Forward-looking statements can be identified by words such as believes ,estimates, anticipates, expects ,intends, may/will/plans, outlook and other words of similar meaning in connection with a discussion of future operational or financial performance .Forward-looking statements are necessarily dependent on assumptions ,data or methods that may be incorrect or imprecise and that may be incapable of being realised, and as such, are not intended to be a guarantee of future results ,but constitute our current expectations based on reasonable assumptions .Actual results could differ materially from those projected in any forward-looking statements due to various events, risks, uncertainties and other factors .We neither assume any obligation nor intend to update or revise any forward looking statements, whether as a result of new information ,future events or otherwise.