Beardsell Management Discussions

Certain statements made in the management discussion and analysis relating to Companys objectives, projections, estimations and expectations, may constitute ‘forward looking statements within the meaning of applicable laws and regulations. Actual results, performance or achievements may differ from such expectations whether expressed or implied. The important factors, which could have an impact on the companys operations, include climatic and economic conditions affecting demand and supply, changes in government regulations and taxation, and other incidental factors over which the Company does not have control. The company assumes no responsibility to publicly amend modify or revise any forward looking statements, on the basis of any subsequent developments, information or events.

Economic Overview:

Global Economy

While post-pandemic recovery in Calendar Year (CY) 2021 witnessed a GDP growth of 6% on a low base in CY2020, Global GDP growth rate normalized to 3.4% for CY2022 as per the International Monetary Fund (IMF). At the same time. Global inflation rose from 4.7% in CY2021 to 8.7% in 2022 as per study conducted by IMF. Rise in inflation was fueled by various factors including the release of pent-up demand post pandemic and supply chain disruptions due to after-effects of pandemic and US-China economic war. Excessive monetary easing by various countries post pandemic intensified the impact. Finally, the Russia Ukraine conflict exacerbated the inflation issue. In order to fight rising inflation central banks around the world reversed their policies from monetary easing and started tightening liquidity. Given such developments, while inflation levels have recently started to soften, an adverse impact on global growth is to be expected. IMF has revised downward the global GDP growth forecast for CY2023 to 2.8%.

Indian economy

Among all the global economic and geo-political turmoil, India has remained a bright spot in the world economy. India ended FY 2022- 23 on a strong footing with a GDP growth of ~7% despite headwinds from ongoing Russia- Ukraine conflict, high levels of inflation and rate hikes by RBI.

FY 2022-23 began in the backdrop of the challenges posed by the rising inflation brought on by the Russia Ukraine conflict. Globally, pricing for crude oil, natural gas, food and fertilizers rose substantially. While India has traditionally been playing a balancing act in line with its policy of non-aligmnent, it has not been iimnune to negative economic consequences of such conflicts. India was particularly hit due to high crude oil prices. However, the government proactively mitigated this challenge by sourcing crude oil supplies from Russia at a significant discount to prevailing crude oil prices.

With the third COVID wave receding in Q1 2022, fears of pandemic took a back seat. As such consumer demand for a large variety of goods and services gained momentum. Such additional demand also fueled the supply side driven inflation. Despite the mitigation measures taken by the government, India still had to suffer an initial inflation shock, which took consumer inflation to a level of 7 to 8%. To counter such high levels of inflation. Reserve Bank of India sprang into action and started increasing interest rates from May 2022 and ended FY 202223 with the repo rate at 6.5%, a 250 bps rise during the year.

Inflation started to soften during the second half as a result of normalization of commodity prices and high interest rates. WPI (Wholesale Price Index) inflation came down from a high of 13.88% during June 2022 to around -3.5% in June 2023. Similarly, CPI (Consumer price index) inflation came down from as high as 7.8% in May 2022 to 4.25% in June 2023. GST collections continued to grow throughout the year indicating good economic activity. Monthly GST collections improved from Rs.1,41,000 Crore in May 2022 to Rs.1,87,000 Crore in April 2023, indicating robust economic conditions in India.

Business Overview:

India has emerged as a manufacturing hub. The Make in India campaign places India on the world map as a manufacturing center and gives global recognition to the Indian economy. According to the Indian Brand Equity Foundation, India is projected to rank among the top three growing economies and manufacturing destinations in the world. Indias astonishing growth would drive the deployment of thermal insulation in heavy industry, oil & gas industry, and power generation industry. Rise in number of pharmaceutical industries in India is posing significant business opportunities for the thermal insulation market players to increase their respective customer base and expand their presence in the country. The India thermal insulation market is expected to reach INR 3,674.98 crore by 2028 from INR 2,189.81 crore in 2020 at a CAGR of 7.4% from 2021 to 2028 as per a study published in 2021.

The use of Expanded Polystyrene (EPS) Foam is an effective and advanced method for the thermal insulation of buildings. It offers the damage-resistant and pennanent insulation for house to improve living comfort and lower heating bills of building. The EPS insulation is described by a high efficiency and short application time. The government legislation coupled with rising awareness about the advantages of thermal insulation is boosting the demand for insulation products.

Driven by the favorable economic conditions, your company delivered strong double digit revenue growth of around 25 percent on consolidated basis. The consolidated net profit after tax during the year was increased by 200% resulting from robust cost control mechanism clubbed with volmne growth and healthy margins between raw material and finished product prices.


Insulation segment which comprises manufacture of Expanded Polystyrene (EPS) Products, Prefab Panels and related Contracting Activities. EPS has varied applications in insulation and packaging. The prefab building elements manufactured by your Company finds applications in cold Storages, Food Processing Plants, Pharmaceuticals and Roofing applications. SteilWallz panels finds applications in construction of low-cost housing. Consolidated insulation revenue which was 92 percent of the total revenue during the year had grown by around 27 percent to Rs.21226 Lakhs.


Your company trades in motors, export of fabrics, telemedicine equipments, information technology products etc. based on opportunities. The consolidated trading revenue during the year was increased by around 4 percent to Rs. 1,975 Lakhs

Standalone performances in past ten years are provided below:


Year ended 31st March

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

(Rs. Lakhs except wherever otherwise mentioned)


10704.20 13202.42 15122.88 18060.02 15158.90 17119.39 14010.44 12166.50 17559.08 22173.76

Profit before Depreciation

424.88 299.28 835.68 1449.02 359.36 283.46 650.64 571.76 913.14 1662.50


222.52 304.50 322.33 337.12 319.11 330.27 497.23 525.33 511.87 500.64

Taxation - Current

4.70 0.00 155.00 412.00 18.57 22.58 200.00 151.95 103.43 288.23

- Deferred

68.54 4.61 29.82 8.70 (42.98) (1.14) (155.06) (82.77) 10.50 (0.90)

Profit / (Loss) after Tax

129.12 (9.83) 328.53 691.20 64.66 (68.25) 108.47 (23.35) 287.34 838.54


46.83 46.83 56.20 70.25 67.44 - 67.44 28.10 37.47 39.44

Tax on Dividend

7.96 9.53 11.44 14.30 13.73 - 13.86 - - -

Retained Funds

74.33 (66.19) 260.89 606.65 (16.51) (68.25) 27.17 (51.45) 249.87 799.10

Share Capital

468.32 468.32 468.32 468.32 561.98 561.98 561.98 561.98 749.31 749.31

Earnings per Share (Rs.)

2.76 (0.21) 7.02 2.46 0.23 (0.24) 0.39 (0.08) 0.96 2.24

Net Worth

3325.29 3253.32 3514.21 4108.72 4110.06 4031.86 4055.28 3989.62 5112.95 5913.10

Book Value per Share (Rs.)

71.00 69.47 75.04 17.55 14.63 14.35 14.43 14.20 13.65 15.78

Face Value per Share (Rs.)

10.00 10.00 10.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00

Key financial ratios and significance changes in them are disclosed under notes to the standalone and consolidated financial statements.

Internal Control System

There is a strong internal control culture in the company, coimnensurating with its size and the nature of operation which and providing reliable financial and operational information, compliance of applicable statutes, safeguarding of assets from unauthorized use, executing transactions with proper authorization and ensuring compliance of corporate policies. Highest standard of internal control is ensured by regular audit by the Internal Auditors. The significant observations made in internal audit reports on internal control deficiencies, if any, and the status on implementation of recommended remedial measures, are presented and reviewed by the Audit Committee of the Board. The statutory auditors of the Company have issued a report on the internal control over financial reporting as stated under section 143 of the Companies Act, 2013.

Human Resources

Human Resources are one of the most important ingredients to fuel future growth and progress of the organization. The Company therefore strives to align human resource policy and initiatives to meet business plans, and fosters a performance oriented work culture and offers amongst the best opportunities in the industry for professional as well as personal growth of its employees. Over the years the company has built up a strong human resource structure. The company has qualified and experienced team of professionals in Production, Marketing, Finance, Legal & Secretarial, HR & Administration.

Risks and concerns

Company continuously monitors the risks associated with its business and operations including timely identification of new risks, if any, and plans to mitigate risks so as to avoid any adverse impact on the Companys operations. The company has identified following risks for regular monitoring:

Our Company is significantly reliant on the revenues earned from our insulation and pre-fabricated metal sheet and EPoS core buildings and panels. Any downturn in our ability to increase or effectively manage our sales could have an adverse impact on our Companys business, cash flows and results of operations.

Our Companys business is dependent on few customers. Any loss of such customers or a significant reduction in purchases by such customers could adversely affect our business, results of operations and financial conditions.

We depend almost entirely on third-party suppliers in respect of availability of our raw materials. An interruption in the supply of such products and price volatility could adversely affect our business, results of operations and financial condition

Our inability to receive or renew the necessary licenses, approvals and registrations in a timely manner or at all may lead to interruption of our Companys operations. Failure to meet our production timelines may impact our reputation and could also lead to cancellation of our orders.

Some of the raw materials that we use are inflammable in nature. While we take adequate care and follow all relevant safety measures, there is a risk of fire and other accidents, at our manufacturing units and warehouses. Any accidents is likely to result in loss of property of our Company and/or disruption in the manufacturing processes which may have a material adverse effect on our results of operations, cash flows and financial condition.

If our Company is unable to protect its intellectual property, or if our Company infringes on the intellectual property rights of others, our business may be adversely affected.

We do not own certain premises used by our Company. Disruption of our rights as licensee/ lessee or termination of the agreements with our licensors/lessors would adversely impact our manufacturing operations and, consequently, our business.

Our Company requires significant amount of working capital for a continuing growth. Our inability to meet our working capital requirements may adversely affect our results of operations.

Any failure in our quality control processes may adversely affect our business, results of operations, cash flows and financial condition. We may face product liability claims and legal proceedings if the quality of our products does not meet our customers expectations.

Companys businesses are subject to a variety of laws and regulations. Non-compliance with and changes in, safety, health, labour and enviromnental laws and other applicable regulations, may adversely affect our business, results of operations and financial condition.