About the company
Ecoboard Industries Limited the Company was incorporated in India on 20th
November, 1991 with objective to serve "Mother Earth" through its both
divisions:
a. EcoBuild: Sustainable Building Materials & Products using Natural Fibers
extracted from Agro-residue
b. EcoEnergy: Sustainable Energy from Industrial & Agro-residue using sustainable
technologies.
a. EcoBuild Division
Companys EcoBuild Division, developed advanced building materials in the brand name of
"Forster?" using variants of Ecoboard? as base
materials, are acting as "Carbon Capture Storage" products that are actually
enabling positive effects on Climate. Also, its creating additional income to farmers;
avoiding pollution caused from burning
Agro-fibers and also saving Forests.
The products include Internal Walls, Internal Ceiling, Doors, Structural Flooring,
EcoDek? , EcoRak? and Shelves, Cold Rooms, Carvings, HDUMR?,
etc.
Manufacturing process of Agro-based Boards/Products:
A lot goes into the process of manufacturing Agro-based "Agro-boards". Bales
of Agro-fibers, received from Agro-based factories are elaborately processed, blended,
resin with fibers, machine pressed, screened, layered into sheets, checked and graded to
reconfirm quality.
This is followed by a secondary process of decorative covering with textured melamine
gas treated design using a short cycle laminating process. The end product, manufactured
from agro residue such as sugarcane waste, stalk of cotton, bajra, tur, corn etc.
sturdy, durable, easy to maintain, abrasion resistant, eco-friendly, moisture resistant,
dimensionally stable, termite resistant, fire retardant, and also cost effective.
Further, the company has introduced state of art high capacity machines to process the
materials in-house, before being supplied to both Overseas and Domestic customers.
Manufacturing facilities:
The company has a manufacturing facility at the heart of Rural India in Solapur
District.
The production capacity of Velapur factory is 36 Lacs m2 per annum.
Furthermore it has sophisticated and automated plants and machinery imported from Germany
and the UK.
The case for Ecoboard
Philosophy and Environmental outlook
Ecoboard are made from any form of agricultural waste and converted into good quality
Ecoboard/fiber board for application to office furniture, home furniture, school
furniture, wall paneling, commercial buildings, and floors etc. as against the traditional
building materials like Steel, Gypsum, Cement, Marble etc. having high carbon-footprint.
Risks Agro-fibre as a raw material
The main risk is of availability of raw material in required quantity and at economic
price, agro-fiber is being used captively by the sugar factories for steam generation and
for generation of electricity. With a power shortage in Maharashtra State the pressure on
sugar factories to generate electricity would be high and to that extent availability of
agro-waste and its price would be a constant concern. Today agro-waste in Maharashtra is
available for Ecoboard board industry at over Rs. 2500/T excluding landing cost plus GST
which is industry irrelevant. It is ironic to note that the by-product itself is now
available at a higher price than sugar cane where once the disposal of agro-waste itself
was a problem. Plywood which is conventionally used is still encouraged and continued by
the public at the cost of depleting forest cover and tree resources due to lack of Govt.
clear direction despite ban on expansion of the plywood industry by the Honble Supreme
Court.
Industry synopsis
Over the period globally demand for sustainable alternative materials are getting used
over traditional building materials having high CO2 emissions.
Agro residue not only serves the environmental cause, but also encourages rural
employment and rural development and brings sizable revenue to the poor farmers through
sale of agro-residue which is otherwise burnt in the field causing enormous carbon
emissions.
Risk aversion initiatives
In view of the High Agro-waste price, your Company has taken up the work of improving
the material preparation section of Ecoboard boards of 13.5x6 size production line. Work
on setting up of the new production line has been completed Company has developed new
products and applications, enabling it to create new markets, building materials made
using Gypsum, Cement, Marble etc.
Modification of existing line of 13.5x6 boards resulted in
a) Reduction in our cost of Production on account of reduction in power consumption by
at least 25%. b) Reduction in ratio of Raw material consumption and inputs. c) Reduction
in manpower on account of automation.
Optimal capacity utilization, logistics, connectivity of distribution system by setting
up nodal service centers at strategic locations across India and a swift delivery module
by maintaining stock of finished goods at centers these are the key elements in our road
map for achieving growth targets.
Company is planning to install 1 MW Solar power in available land in a few years time
to reduce dependency on high cost coal based power.
Trends technological challenges, new developments
The developed countries have mandatory requirements of Sustainable, Fire-retardant
products and low formaldehyde free norms/directions for living environments due to the
importance of lowering CO2 emissions and reducing toxicity. Other countries are following
with the support of local/national governments.
The production process will have to be in conformity with the ISO 9001.
The boards being made are fully (100%) recyclable or reusable to an equal product in
order to fulfill the Cradle to Cradle (C2C) concept.
With the increasing globalization there is a need to standardize the product at par
with the international standards. This would enhance the product life, meet the users need
and benefit economically for the user.
Process improvement in par with ISO standards would bring environmental consciousness
among the user groups and aid in Internationalization of R & D in the industries.
Company has already started the process to increase revenue by overcoming raw material
problems and by adopting new technology which helps to minimize production cost.
b. EcoEnergy:
With technical assistance from Sulzer Chemtech Ltd., Switzerland the company
manufactures wastewater treatment plants which handle toxic residues spent wash and
effluent of obnoxious nature from distilleries and transform Eco Energy, by product of the
treatment process into fuel, i.e., turning waste water to wealth.
Internal Control Systems
Adequate internal control systems are in place in all areas of operation to ensure
safeguarding of assets against loss from unauthorized use or disposition and the same are
being continually reviewed and strengthened wherever necessary. Such systems have also
been developed to ensure adherence to policies and systems and mitigation of the
operational risks covering each area under review. The organization is well structured and
the policy guidelines are well documented with pre-defined authorities. The company has
also implemented suitable controls to ensure that all resources are utilized optimally,
financial transactions are reported with accuracy and there is a strict compliance with
all applicable laws and regulations.
Corporate Social Responsibility
As a matter of fact there is no formulated written CSR Policy in place. The Board
invariably has 1) Planted trees 2) Provide Schools furniture for Government schools
3) Medical and Food camps for the annual event "Wari" attended by lakhs of
pilgrims.
The Company developed a strategy to provide a roadmap for its CSR activities over the
period and after passing of the Companies Act, 2013 in particular, which has become an
integral part of our business strategy over a decade or so.
As a good corporate citizen, we recognize and perform the obligations towards our
employees, investors, customers, suppliers, competitors and the community as a whole. We
believe our reputation, together with the trust and confidence of those with whom we deal,
to be one of our most valuable assets. We strongly believe that integrity in dealings with
stakeholders is a prerequisite for a successful and sustained business relationship.
Environment
As the products of the Company are eco-friendly and fired by a passion of protecting
the environment, the company believes that, by nature, our operations have a minimal
impact on the environment. In the course of our operations we seek to identify
opportunities to reduce/ keep it at minimum consumption of energy, water and other natural
resources. We also strive to reuse and recycle where possible and dispose of
non-recyclable items responsibly, thereby minimizing impact on the environment.
Human Resources / Industrial Relations
The Company has a fully functional human resource department taking care of human force
in the Company. Company has taken efforts for human resource development. Company has
arranged various training programs during the year. Company has a proper team for
recruitment of employees and keeps the compensation structure in line with the market
developments.
Financial Performance
Share Capital and Reserves and Surplus
During the year Authorized capital of the Company stands at Rs. 2500 Lakhs (inclusive
of Equity Shares of Rs. 10 each at 2300 Lakhs and Preference Shares of Rs. 100 each at 200
Lakhs and Reserves & Surplus of Rs. 260.57/- Lakhs it includes Depreciation on fixed
assets whose residual useful life is nil is adjusted against retained earnings as per
provisions of Schedule II to the companies Act, 2013 and paid up capital were 1783.20/-
Lakhs.
Fixed Assets
The Company has a program of verification of Property, Plant and Equipment and
right-to-use assets to cover all the assets once every two years which, in our opinion, is
reasonable having regard to the size of the Company and the nature of its assets. Pursuant
to the program, certain Property, Plant and Equipment were due for verification during the
year and were physically verified by the Management during the year. Depreciation on
tangible assets is provided on the straight line method as prescribed in Schedule II to
the Companies Act, 2013 over the remaining useful life of the assets.
Current Assets Loans and Advances and Current Liabilities and Provisions
Total Loans and advances as at 31st March, 2023 was Rs. 372.44 Lakhs.
Company has Rs. 1,710.79 Lakhs of Inventories of Raw Material, Stores and packing
Material, Finished goods etc.
Operational Performance
Particulars |
Current Year |
Previous Year |
|
2022-23 |
2021-22 |
Income: |
|
|
| Revenue from operations |
3,859.85 |
3,471.75 |
| Other Income |
172.47 |
101.48 |
Total Income |
4,032.23 |
3,573.23 |
Expenditure: |
|
|
| Cost of materials consumed |
1,868.99 |
2,044.58 |
| Purchase of Stock-in-Trade |
3.69 |
0.00 |
Changes in inventories of finished goods, work-in- progress |
181.49 |
(310.85) |
| Employee benefits expense |
288.17 |
288.07 |
| Finance costs |
233.62 |
209.02 |
| Depreciation |
104.33 |
98.21 |
| Other expenses |
1,867.67 |
1,337.41 |
Total Expenses |
4,547.96 |
3,666.44 |
Profit / (Loss) before exceptional items and tax |
(515.64) |
(93.21) |
| Add/(Less): Exceptional items |
201.32 |
307.26 |
Profit / (Loss) before tax |
(314.32) |
214.05 |
| Less: Tax expenses |
0.00 |
0.00 |
Profit / (Loss) for the period |
(314.32) |
214.05 |
Other Comprehensive Income |
642.60 |
(11.00) |
| Items that will not be reclassified into profit or loss |
|
|
Total Comprehensive income for the year (net of tax) |
328.28 |
203.05 |
| Total comprehensive income for the year |
|
|
Earnings / (Loss) per Share (Rs.) |
|
|
| -Basic |
1.84 |
1.14 |
| -Diluted |
1.84 |
1.14 |
Key Financial Ratios |
Standalone |
|
|
|
Particulars |
Unit |
FY 2022-23 |
FY 2021-22 |
% Change |
| Debtors Turnover |
Times |
5.55 |
5.05 |
9.90 |
| Inventory Turnover |
Times |
1.87 |
1.78 |
5.062 |
| Interest Coverage |
Times |
(0.68) |
(0.64) |
(6.25) |
| Ratio |
|
|
|
|
| EBIDTA |
In Lakhs |
(177.69) |
214 |
(155.00) |
| Current Ratio |
Times |
1.47 |
1.27 |
16.40 |
| Debt Equity Ratio |
Times |
1.22 |
1.42 |
- |
| Net Profit Margin |
% |
(8.14) |
6.17 |
- |
| Return on Net worth |
% |
(0.15) |
0.12 |
- |
Cautionary Statements
Statements made in the Management discussion and analysis report describing the
Companys objectives, expectations or predictions may be forward looking within the
meaning of applicable laws and regulations. Actual results may differ materially from
those expressed in the statement. Important factors that could influence the Companys
operations may include:
1) Supply and demand conditions affecting selling prices, input availability.
2) Companys ability to successfully implement Companys strategy, growth and expansion
plans and technological initiatives. 3) Changes in government policies, changes in
political conditions, 4) Changes in laws and regulations including tax laws. 5) General
economic developments and business conditions in India and other countries. Other factors
such as litigation and industrial relations.
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