banka bioloo Management discussions

Companys Business Structure:

Banka Bio is committed to a forward-looking strategy characterized by a dynamic, responsible approach aimed at achieving profitable growth. We are dedicated to expanding and solidifying our position as market leaders.

Our investments are carefully directed towards introducing innovative, sustainable products and solutions tailored to local operating conditions. We execute our growth strategy through strategic partnerships with select companies, both domestic and international, as well as leveraging our inhouse R&D capabilities. Our track record in the industry is distinguished by a consistent delivery of high-quality products and services, resulting in strong relationships and trust among our existing clients, leading to a substantial rate of repeat business. We have full confidence that our new product offerings will continue to drive robust revenue growth. Banka Bios vision includes the development of three key segments, with a primary focus on Waste Management (including bio-toilets and FSTP), Wastewater Treatment/Management, and Water Conservation.

Banka Bio is building three segments with focus towards:

1. Bio-Waste Management (bio-toilets, FSTP)

2. Wastewater Treatment/Management, and

3. Water Conservation

i. FSTP (Feacal Sludge Treatment Plant):

All the state government under the Swachh Bharat Mission-2 mission has put Feacal Sludge Management (FSM) as one of the four focus areas. The overall potential is in the tune for INR +4,000 crore. BBL will continue to focus on the states of Telangana, and AP, and expand scope for development in nearby states of Odisha, Tamil Nadu, and Karnataka to realize better efficiencies of scale.

ii. Bio-toilets:

There exists huge, untapped potential for bio-digestor based faecal

waste treatment system.

iii. Wastewater Treatment (STP/PSTP/ETP):

India is facing a large deficit in water, necessitating massive investments in water supply and treatment systems.

• Water demand for domestic use will more than double by 2030, and the increased water consumption is driven by strong growth of middle-income segments.

• Increased demand drives wastewater treatment demand as well as water supply.

• The urban wastewater treatment market is highly fragmented with top 10 players consisting of only ~20% market share, expected consolidation of suppliers.

• Favorable government policies for wastewater disposal, and policies around National Water Mission will drive growth in this sector.

• EPC and private PPP opportunities will unfold for Urban wastewater treatment.

• The PPP/BOT opportunity for water treatment over the next five years main for urban/domestic clients i.e., residential, commercial and industrial.

iv. Water Conservation:

Water is scarce and Banka Bio plans to contribute towards water conservation. Banka Bio has introduced innovative water saving WC that will save 75% of water used for daily flushing requirements. The product will be offered for sale to railways, real- estate development companies, commercial complex owners, colleges, and school.

Growth and Resilience

Continued innovation, collaboration, and growth velocity give us confidence in the sustainability of our business momentum. We are in the midst of new product launch cycles that provides strong, structural growth drivers for the next few years.

While evolving market dynamics may prompt reprioritizing of programs, we are confident that spending in sustainability solutions will continue to grow. That growth and our expanding market share give us confidence of being able to sustain a certain base case growth, with room to maximize in better years.

In our journey to that next logical milestone, we are focused on not only our velocity, but also on ensuring we get there fighting fit, so it does not become a finish line to stumble across, but a launchpad to achieve even greater heights. For this to happen we are focusing on to create a more balanced portfolio in sustainability solutions, so we have strong growth engines for the journey ahead. For this, we want to build on our initial successes in the WaSH opportunity, and put in place a structured way to deepen existing innovation and transformation engagements, while expanding the number of clients for whom we provide such services. We are rolling out a new products that will help us achieve these new imperatives.

This new growth pipeline, along with continued investments in building newer capabilities, in building our brand, will help us deepen our customer relationships, expand our sustainability market, gain market share and power growth in the years ahead.

1. Growth Strategies:

Banka Bio, a pioneering player in Indias WaSH industry, is strategically expanding its operations into the water treatment and biopolymer sectors. This bold move aligns with the increasing global emphasis on sustainable practices and environmentally-friendly solutions. As the world faces mounting challenges related to water scarcity, pollution, and the need for sustainable materials, Banka Bio is poised to become a key player in addressing these issues.

1. Innovative Research and Development (R&D): Banka Bios success will hinge on its ability to develop cutting-edge technologies and solutions. By investing in R&D, the company can create novel water treatment processes that are efficient, cost-effective, and environmentally responsible. Similarly, advancing biopolymer research can result in sustainable alternatives to traditional plastics, catering to the growing demand for eco-friendly materials.

2. Partnerships and Collaborations: To accelerate growth and enhance capabilities, Banka Bio should forge strategic partnerships with research institutions, universities, and other industrial players. Collaborations can facilitate knowledge exchange, joint R&D efforts, and access to a broader pool of expertise, driving innovation in both water treatment and biopolymer development.

3. Market Diversification: As Banka Bio ventures into the water treatment and biopolymer sectors, it should identify diverse market segments and tailor its offerings accordingly. This could involve targeting industries such as agriculture, municipal water management, manufacturing, and packaging. Diversification reduces risks associated with overdependence on a single market.

4. Sustainability as a Core Value: Given the global focus on sustainability, Banka Bio should position itself as a company that prioritizes environmental responsibility. This can be achieved by adopting green practices within its operations, minimizing waste and energy consumption, and promoting the recyclability of its biopolymer products.

5. Regulatory Compliance and Certifications: Compliance with water quality and environmental regulations is critical for success in the water treatment industry. Banka Bio should ensure its solutions adhere to local and international standards, obtaining the necessary certifications to build trust among customers and regulatory bodies.

6. Marketing and Awareness Campaigns: Educating the market about the benefits of Banka Bios water treatment and biopolymer solutions is vital. Investing in marketing and awareness campaigns will help create a strong brand presence, generate demand, and foster a reputation as a reliable provider of sustainable solutions.

7. Scaling Manufacturing Infrastructure: To meet growing demand, Banka Bio must scale its manufacturing capabilities efficiently. Investing in advanced manufacturing technologies can enhance productivity, reduce costs, and ensure consistent product quality.

8. Talent Acquisition and Skill Development: As Banka Bio expands into new sectors, it should attract and retain a diverse talent pool with expertise in water treatment, biopolymers, and related fields. Continuous skill development programs can ensure the workforce remains up-to-date with the latest advancements.

9. International Expansion: Beyond Indias borders, there is a global need for innovative water treatment and sustainable materials. Banka Bio should explore opportunities for international expansion, tapping into markets where its solutions align with local environmental challenges and regulations.

10. Continuous Innovation: The key to long-term success is to never stop innovating. Banka Bio should foster a culture of continuous improvement and adaptation, staying ahead of market trends and anticipating the evolving needs of its customers.

In conclusion, Banka Bios strategic foray into the water treatment and biopolymer sectors holds great potential for growth and positive environmental impact. By following these growth strategies and maintaining a commitment to innovation and sustainability, the company can establish itself as a leader in these critical industries.

Industry Structure and Developments

The Water, Sanitation, and Hygiene (WaSH) industry in India encompasses a multifaceted structure aimed at addressing the nations water and sanitation challenges. The sector has evolved significantly over the years, driven by both government initiatives and private sector participation. Indias WaSH industry involves a spectrum of stakeholders including government agencies, nongovernmental organizations (NGOs), research institutions, technology providers, and private companies. Development in this sector has seen a shift from traditional approaches to more innovative and sustainable solutions, driven by advancements in technology and a growing awareness of the importance of access to clean water and proper sanitation. The Indian governments flagship programs such as Swachh Bharat Abhiyan and initiatives promoting clean drinking water emphasize the crucial role of the WaSH industry in improving public health and ensuring environmental sustainability. As the country continues to urbanize and face increasing water scarcity challenges, the WaSH industrys growth and development are vital to achieving Indias socio-economic goals and ensuring a healthier and more sustainable future for its citizens.

Opportunities and b

Threats

The WaSH industry in India presents a range of opportunities and challenges as it strives to address the countrys water and sanitation needs.

Opportunities lie in the vast market potential for innovative water treatment technologies, sustainable sanitation solutions, and access to clean drinking water in both urban and rural areas. Government initiatives and international partnerships provide avenues for investment, fostering a supportive environment for growth. Moreover, the increasing awareness of environmental sustainability and the urgency to improve public health offer a fertile ground for the industrys expansion.

Opportunities:

1. Technological Advancements: The rapid progress of technology offers an array of tools to revolutionize the WaSH industry. From advanced water treatment techniques that can purify contaminated water sources to smart sensors and data analytics that enhance monitoring and maintenance of water supply systems, technology presents the potential to improve efficiency, reduce waste, and enhance service delivery.

2. Government Initiatives: Indias government has demonstrated a strong commitment to WaSH through initiatives like the Swachh Bharat Abhiyan and the Jal Jeevan Mission. These programs underscore the significance of sanitation and clean water for health and well-being, offering a platform for partnerships, investments, and innovation to address the gaps in water supply and sanitation coverage.

3. Private Sector Participation: Increasing private sector involvement is transforming the industry by bringing in expertise, resources, and market-driven approaches. This opens doors for novel financing models, innovative business solutions, and efficient project execution.

4. Rural-Urban Synergy: The movement of people from rural to urban areas can drive demand for modern WaSH solutions, creating opportunities for urban planning, water treatment, and sanitation infrastructure development. Integrating rural practices with urban infrastructure can yield sustainable and scalable solutions.

5. Environmental Sustainability: The growing awareness of environmental sustainability and the need to mitigate water pollution and scarcity is driving the adoption of eco-friendly practices and technologies. Sustainable water management, waste reduction, and water reuse are becoming central tenets of the industrys growth.

Threats:

1. Water Scarcity and Pollution: Indias water resources are under immense stress due to population growth, industrialization, and climate change. Water scarcity and pollution pose significant challenges to the provision of safe and adequate water supply, requiring innovative approaches to water sourcing, treatment, and distribution.

2. Inadequate Infrastructure: A substantial portion of Indias population still lacks access to basic sanitation facilities and clean drinking water. The need for extensive infrastructure development, particularly in rural and underserved areas, demands significant investments and well-coordinated implementation.

3. Behavioral Change: Cultivating behavioral change to promote proper hygiene practices remains a persistent challenge. Encouraging communities to adopt hygienic behaviors and proper waste management practices requires culturally sensitive and context-specific strategies.

4. Regulatory Complexity: Navigating regulatory frameworks and obtaining necessary clearances for WaSH projects can be complex and time-consuming. Streamlining regulatory processes and ensuring compliance while maintaining quality standards is essential for sustainable growth.

5. Socio-Economic Disparities: Indias socio-economic disparities are reflected in uneven access to WaSH services. Bridging the gap between urban and rural areas, as well as addressing the needs of marginalized communities, demands inclusive approaches that consider affordability, accessibility, and cultural sensitivities.

Segment-wise or Product-wise performance

The operations of the Company relate to only one segment i.e. Human Waste Disposal Management. Hence, the disclosure on the segment-wise or product-wise performance is not applicable to the Company.

Industry Outlook:

The WaSH industry in India stands at a pivotal juncture, shaped by a dynamic interplay of factors ranging from rapid urbanization and technological advancements to pressing environmental concerns and evolving government policies. As the most populous nation on the planet, India faces formidable challenges in ensuring access to clean water and proper sanitation for its diverse population. However, within these challenges also lie opportunities for innovation, growth, and transformative impact on public health, environmental sustainability, and socio-economic development.

The outlook for Indias WaSH industry is one of both promise and complexity. The challenges are significant, but the potential for positive impact on public health, environmental sustainability, and socio-economic development is equally profound. By embracing innovation, collaboration, and inclusive approaches, India can pave the way for a WaSH industry that not only addresses the pressing needs of today but also lays the foundation for a healthier, more sustainable, and equitable future for all its citizens.

Risk and Concerns:

The WaSH industry also faces significant risks. Persistent challenges include inadequate infrastructure, unequal distribution of resources, and water pollution. Climate change exacerbates water scarcity and quality issues, impacting the availability of clean water. Financial constraints and regulatory complexities can

hinder effective implementation of projects, particularly in rural and marginalized communities. Balancing affordability and quality in a diverse and populous country like India is a constant challenge. Moreover, ensuring behavior change and promoting hygiene practices in a culturally diverse population requires tailored strategies. The industrys success hinges on its ability to navigate these challenges, leveraging opportunities to create sustainable and equitable solutions for Indias water and sanitation needs.

Internal Financial Control Systems and their adequacy:

The Company has aligned its current systems of internal financial control with the requirement of Companies Act 2013. The Internal Control is intended to increase transparency and accountability in an organizations process of designing and implementing a system of internal control. The required internal control systems are implemented by the Company for the various activities across the organization to ensure that business operations are directed towards attaining the stated organizational objectives with optimum utilization of the resources.

Internal audit is carried on a quarterly basis, the scope and coverage of audits include review and reporting on key process risks, adherence to operating guidelines and statutory compliances. Internal auditors work with all levels of management and the report is placed before the audit committee. The audit committee after reviewing the findings and suggestions directs the respective departments to implement the same.

Financial Performance:

Your Company has generated gross revenue from operations for FY 2022-23 of Rs. 42.14 crores as compared to Rs. 38.63 crores in the previous year, recording an increase of 9.08%. The net profits increased to Rs. 3.07 crores for the financial year 2022-23, as against Rs. Rs. 3.05 crores in the previous year, recording an increase of 0.58%.

Key Financial Metrics (In Rs. millions)

Items	2022-23	2021-22	2020-21	2019-20
Total Assets	625.71	467.74	463.73	596
Current Assets	376.28	345.45	359.97	393.87
External Liabilities	219.82	187.45	163.43	221.45
Current Liabilities	159.28	107.31	91.94	140.24
Profits Before Taxes	41.47	78.46	18.7	32.6
Profits After Taxes	30.76	62.27	22.06	30.59
Net Worth	405.89	280.29	300.3	374.55
Liquidity	216.99	238.14	268.03	253.63
Gross Annual Revenue	482.55	550.42	356.65	445.92
Net Annual Revenue	429.55	483.2	310.3	390.8

 

Ratio	Numerator	Denominator	Year ended 31.03.23	Year ended 31.03.22	% Variance
Trade receivables turnover ratio	Revenue from operations	Average Trade Receivable	3.61	3.07	17.58%
Inventory Turnover Ratio	Cost of goods sold	Average Inventory	0.70	0.71	-1.99%
Debt Service Coverage Ratio	Earnings available for debt service= Net profit after taxes + Non-cash operating expenses + Finance cost	Debt service= Interest & Lease Payments + Principal Repayments	1.53	1.28	19.55%
Current Ratio	Current Assets	Current Liabilities	2.36	2.81	-15.89%
Debt - Equity Ratio	Total Debt	Shareholders Equity	0.33	0.37	-10.45%
Net profit ratio	Net Profit	Revenue from operations	7.30%	7.92%	-7.80%
Return on Equity (ROE):	Net Profits after taxes	Average Shareholders Equity	7.88%	9.06%	-13.03%

Human Resources

The company strongly believes that its Human Resources are one of its most valuable resource. The Company prioritizes the professional as well as personal development of each employee, encouraging them to remain motivated and achieve organisational objectives. The necessary training is being imparted to the employees and various seminars and workshops are being conducted to continuously hone their skills. The Company aims to create a conducive working environment, upholding the values of diversity, openness and transparent communications across organisational hierarchies. We are committed to build an open and transparent culture, through which employees can provide feedback without any inhibitions.

Employee Headcount:

The number of permanent employees on the rolls of Company, as on 31 March 2023, are 685.

The Companys industrial relations continued to be harmonious during the review period.

Disclosure of Accounting Treatment

The Company has complied with the applicable accounting treatment standards as prescribed in the Indian Accounting Standards, while preparing the Financial Statements for year ended on 31 March 2023. The financial statements represent a true and fair view of the underlying business transactions.