Chemtech Industrial Valves Ltd Management Discussions.
1. Industry Structure and Development:
A valve is a device that regulates and controls the flow of a fluid. Valves are used to control or divert the flow of liquids, gases, slurries, dry material or steam in all types of industries. They are also used to control or isolate the rate of flow volume, pressure, direction or a combination of these parameters. There are only two known ways of controlling the flow of liquids and gases, and all valves.
According to the recently published report by Tech Sci Research, "India Industrial Valves Market Forecast & Opportunities, 2020", Indias industrial valves market is largely dominated by organized manufacturers and is expected to witness double digit growth at a CAGR of 13% during the forecast period. Over the past two decades, many of the leading global valve manufacturers have identified India as a high potential market for valves and thus entered the market. Leveraging their expertise and technical know-how, these players have been able to identify the potential applications of valves in various industrial applications and process industries. Indian valve industry has come a long way from making simple valves to producing a wide range of sophisticated precision valves. The demand for valves is witnessing growth in almost all areas. All core sectors of industry require various types of valves for expansion of capacities, de-bottlenecking or routine maintenance and repairs of plants.
2. Opportunities & Threat:
i. Fully Integrated Manufacturing Facility:
Our manufacturing facility is fully integrated and self-sufficient. The raw materials and consumables are readily available. Further, all other utilities like fuel, power and human resources have posed no hurdle till date. All the equipment required for manufacturing the products are in place.
ii. Experienced Management team:
Our Company is managed by a team of professionals led by Chairman, Mr. Pradeep Shikharchand Badkur, who has over 15 years of experience in this business. We believe our growth strategy in combination with managements demonstrated ability to consistently meet the customers high expectations for quality and reliability, serves as a foundation for future revenue growth and stable operating profit. The promoter and Senior Management team of our Company has significant industry experience and has been instrumental in the consistent growth of our Companys performance.
iii. Continuous focus on developing novel and innovative products:
For any company, innovation and technical progress are key factors for its success in the long term. Our Company constantly encourages its people to innovate and develop new products for catering to demands of our customers. We are in constant touch with our clients in order to assess their requirements for increasing their process efficiency. This has helped our Company to become a Solution Provider and not just a manufacturing concern.
iv. Strong Customer-Base:
We have long-standing relationships with our customers for whom we have executed repeat orders over an extended period of time, which we believe have been established and are strengthened by the dedicated infrastructure and our ability to meet Clients requirements for customized products. Our customers include leading steel plants, government companies, engineering companies and EPC contractors.
In order to strengthen our relationship with our customers, we have appointed authorized representatives/ channel partners of the company at most of our major client/consultant locations for handling day to day activities at their respective location. We also have representatives at various major cities. These representatives channel partners are responsible to generate business from their respective geographical region, liaising with existing customers, solving their queries and providing after sales service to the client. All the activities are taken place in close co-ordination with the client. Necessary technical help is provided to our representatives for conducting business on our behalf.
v. Technical expertise and vast industry experience:
All our Promoters are experienced in our line of business. Further we have employed professionals having technical and commercial backgrounds. Our Company feels that the strength of any successful organization lies in both, the experience and guidance of its team leaders and the efficiency and technical capability of the staff. A lot of care has been taken in choosing the right people for right job.
vi. Quality Assurance and Standards:
Our company believes in imbibing stringent quality standards in all our processes and products. Our company has been accredited with ISO 9001-2008 certification. Our company is dedicated towards quality of our products, processes and inputs. We adhere to quality standards as prescribed by our customers, which enable us to maintain our brand image in the market.
3. Segment wise performance
The Operation of the Company predominantly relates in two business segmenis i.e. "Manufacturing of lndustrial Valves" and "Trading of various items for project sales". Business segments have been identified as separable primary segment in accordance with lndian Accounting Standard l08" Operating Segments" as prescribed under Companies (Accounting Standards)RuIes, 2006, taking into menu the organizational and internal reporting structure as well as evaluation of risks and returns or these segments. The performances of both segments are well-tuned and your management is confident about achieving better performance for coming financial years.
4. Future Outlook:
The Indian Economy is unstable but showing signs of revival in near future. The demand for valves is witnessing growth in almost all areas. All core sectors of industry require various types of valves for expansion of capacities, de-bottlenecking or routine maintenance and repairs of plants for which Valves will be very productive.
5. Internal Control Systems & Their Adequacy:
Your Company has a sound internal control system commensurate with its size. Internal Audit reports are discussed by the professionals & member of audit committee & suitable corrective actions as suggested are adopted by the management. We have always believed that transparency, systems and controls are important factors in the success and growth of any organization.
6. Discussion on financial performance with respect to operational performance
The financial performance is mentioned herein under
|PARTICULARS||31st March 2019||31st March 2018|
|Sales & Other Income||1687.35||4820.03|
|Profit before Interest & Tax||147.24||507.67|
|Less: Finance Charges||146.49||189.92|
|Profit/(Loss) before Taxation||0.74||42.15|
|Less: Provision for Taxation||(22.57)||10.00|
|Net Profit/(Loss) after taxation||23.31||32.14|
7. Material Development on Human Resources / Industrial Relations:
The biggest strength of the Company has always been its people. Only with their participation we have managed to achieve a healthy work culture, transparency in working, fair business practice and a passion for efficiency. The Company follows a unique, home grown philosophy of allowing people to set their own targets and give them the freedom to achieve: I can. This philosophy has spread across all our employees and has been a constant source of motivation for our people. Further, to enhance their skills and enrich their experience, the Company provides continuous training. This includes workshops, courses, seminars and visit to the Companys plants. Of late, we have also started in-house conferences for various disciplines. Employees from all our offices are invited to participate. It is a useful forum for sharing experiences, ideas, innovations and developmental work undertaken in their respective work places. From the beginning, we have followed a progressive policy of taking keen interest in the well-being and progress of our people. All of this, we believe, has nurtured a strong sense of belonging among our people. During the year under review, Industrial Relations were cordial.
8. Cautionary Statement:
Statement in the Management discussion & analysis describing the Companys objectives, projections, estimates & exceptions may be "forward looking statements" within the meaning of applicable securities laws & regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Companys operations include economic conditions affecting demand/ supply and price conditions in the domestic & overseas markets in which the Company operates & changes in the Government regulations, tax laws & other statutes & other incidental factors.
|For and on behalf of the Board of Director|
|Chemtech Industrial Valves Limited|
|Pradeep Shikharchand Badkur||Harsh Pradeep Badkur|
|Place: Mumbai||DIN- 00036822||DIN- 00676715|
|Date: 13th August, 2019||Chairman||Managing Director|