Guj Apollo Inds Management Discussions


The year 2022-23 was a challenging year. This was due to increase in prices of raw materials, especially steel. This increase in the commodity prices has impacted the margin severally.

The highlights of FY 2022-23, in brief are as follows:


The Companys financial results can be summed up as under:

  1. Total Revenue from operations of the Company is Rs. 2,390.49 Lakhs.
  2. Profit Before exceptional items & Tax of the Company is Rs. 166.39 Lakhs.
  3. Profit/Loss after Tax is Rs. 201.08 Lakhs.
  4. Basic and Diluted Earnings per Share is Rs. 1.70


Your Company, while focusing on the Crushing and Screening equipment business, has initiated the process of identifying new products related to construction equipment and material handling. The diversification process takes cognizance of the companys core strength in engineering, R&D and manufacturing. The efforts resulted in new products and customers in the field of construction and material handling.

The management has and will always continue to strive in protecting the interests of all the stakeholders thereby justifying the trust and confidence reposed on them by the stakeholders. The management has always adopted an unbiased attitude in all its actions and has consistently followed the practice of transparency. The management firmly believes in profit sharing and has made sincere efforts to fulfill the expectations of the stakeholders.

Your Company is always alive to the market conditions and with a combination of R&D, dedicated efforts and manufacturing expertise managed to obtain maximum mileage in a difficult environment. Taking cognizance of this difficult period, in the year under review, the Company relied on market money as well as on the internal accruals.

The detailed Management discussion and analysis report, industry wise, economy wise, product wise and in general is as follows:

Industry Structure:

India is one of the fastest growing economies in the world, and it is attracting a lot of attention from international companies. In 2022, Indias GDP grew by 9.1%, making it the fastest-growing major economy in the world. This growth is being driven by a number of factors, including a young and growing population, a rising middle class, and a government that is committed to economic reform.

As a result of this growth, India is becoming an attractive destination for investment. In 2022, foreign direct investment (FDI) into India reached $81 billion, up from $61 billion in 2021. This FDI is being used to fund a number of mega projects, including new infrastructure, manufacturing plants, and data centers.

The crushing & screening market segment in India is experiencing a mixed environment, but the overall trend is positive. The governments focus on infrastructure and mining is creating lucrative opportunities for the industry, and the demand for crushing, screening, and mineral processing equipment is expected to grow in the coming years.

Here are some of the factors that are driving the growth of the crushing & screening market in India:

  • Increased infrastructure spending: The government is investing heavily in infrastructure projects, such as roads, railways, and airports. This is creating a demand for crushing and screening equipment to produce aggregates for these projects.
  • Growing mining sector: The mining sector is also growing in India, due to the increasing demand for minerals such as iron ore, coal, and copper. This is creating a demand for crushing and screening equipment to process these minerals.
  • Technological advancements: There have been significant technological advancements in the crushing & screening industry in recent years. These advancements have made crushing and screening equipment more efficient and productive, which is driving demand for this equipment.

The crushing & screening market in India is expected to grow at a CAGR of 7% in the coming years. This growth will be driven by the factors mentioned above, as well as the increasing demand for crushed and screened materials from other industries, such as the construction, manufacturing, and power sectors.

Your company is well-positioned to capitalize on the growth of the crushing & screening market in India. Companys in- house R&D, and excellent manufacturing practices are giving a competitive edge in this market. Continuous focus on customer service, expansion of distribution network, and investment in marketing and advertising, is making your company well-positioned to improve your market share in this segment.


The Companys major source of business is from mining equipment and manufacturing sector and the growth of the company is therefore directly proportional to the growth in the mining and manufacturing segment. The Crushing & Screening equipment business has a wider market application and caters to road construction, building construction, mining and infrastructure, in general.



  • Targeting customers who are looking for quality equipment at affordable prices: Your company has a reputation for producing high-quality crushing & screening equipment.
  • Taking advantage of lower labor costs: India has a lower labor cost than many other countries, which gives your company a competitive advantage in terms of the overall cost of your equipment.
  • Expanding product range: By expanding product range to include cone crushers, coal crushers, jaw crushers, and HSI crushers, the company can appeal to a wider range of customers.
  • Offering contract manufacturing services to OEMs: By offering contract manufacturing services to OEMs, the company can tap into a new market and generate new revenue streams.

Threats, Risks and Concerns:

  • The global financial market is volatile, and this volatility could impact the Indian economy. If the Indian economy weakens, it could lead to a slowdown in demand for crushing & screening equipment.
  • The crushing & screening equipment market is competitive, and there are many local players who are able to offer low-priced products. This could lead to price pressures and make it difficult for your company to realize higher prices for its products.
  • The prices of steel and other raw materials are volatile, and this volatility could impact the cost of your companys products. If the prices of these raw materials increase, it could lead to higher costs for your company, which could affect the margin.

Segment – Wise or Product-Wise Performance:

The Company operates in a single segment, in the business of manufacturing and sale of Construction and Mining Machineries, and Spare Parts thereof.


In the month of June, 2020, AEML Investments Limited (AEML), wholly owned subsidiary of the Company made the complete exit from Ammann India Private Limited. Post exit, AEML has restarted its manufacturing activities. AEML is focusing on manufacturing of parts for agricultural equipment and farm machinery. AEML will also be undertaking trading of goods and commodities.

Joint Venture:

During the year under review, Gujarat Apollo IndustriesLimited (GAIL) has entered into a Joint Venture Agreement with PFH BV, a Belgium based agri and construction equipment manufacturing company, to work jointly and in cooperation with each other for the purposes of carrying on the Business of agricultural and construction machines and components thereof. This resulted in incorporating an associate Company named PFH Agri Equipment India Private Limited (PAEPL) with 50% shareholding of GAIL and PFH BV each. PAEPL will primarily focus on the production of agricultural and construction equipment. It is yet to commence its business. By utilizing each others synergies, this joint venture will boost efficiency and enable the company to provide superior goods in the market.


The Company sees a moderate to better outlook in the coming years for Crushing and Screening business on its own. The addition of new products with proven technology will improve the top and bottom line of the company. With the existing cash balances, the Company can mobilize the funds and venture in diversified business activities outside of the mining equipment business. With favorable Government policies, the overall market looks positive. With the Government committing itself to infrastructure in general and construction in particular, the demands for the Companys products are likely to see a good growth in the coming years. The positive outlook may get affected by increased cost of capital and uncertain global geo-political conditions.

Internal Control Systems and their Adequacies:

The Company maintains effective and adequate internal control systems. The Internal Control is formed as such to avoid unnecessary losses and to ensure proper record of transactions, reliable financial reporting, safeguarding of assets and adherence to management policies. The Internal Control system is adequately equipped to suggest proper changes that are required in the system to improve performance and eliminate waste.

An Independent firm of Chartered Accountants regularly carries out the internal audit of the Company. Internal audit of the Company is carried out at periodic intervals. The Officers responsible for their functions regularly submit their comments on report and share the steps they have taken to rectify the defects.

Your Company continues to be an ISO 9001:2015 certified Company by TUV India Private Limited (TUV NORD) recognized for the production, quality control and standards.

Human Resources:

Your Company is technology-driven and has its own HR policy, which focuses on qualitative & transparent recruitment, training & development, performance appraisal, employee welfare etc. The Company believes that the development of employees is the prime responsibility of an organization, and its employees are key contributors to the success of its business. The Company believes that its human resources are the key to maintain its leading position in the industry. The Company provides competitive compensation packages combined with a good working culture and environment to attract and retain talented personnel.

The Company seeks to establish and maintain an environment that supports its business processes and ensures that employee performance is evaluated against the achievement of objectives, which are in line with its long-term goals. All employees are provided with KRAs and an opportunity to discuss their performance, plan their development and make self-appraisals.

Comments on Financial Performance with respect to Operational Performance:

During the Financial year under review, the Net Turnover of the Company has decreased to Rs. 2,390.49 lakhs as compared to Rs. 2,957.06 lakhs in the previous financial year.There is lower export sales,which is due to the crises in FOREX market in getting the USD by the customers. Furthermore, we have decided to have approached for better price realization in the domestic market also as against the aggressive approach in the earlier years which has given us the better result in overall profitability which has resulted in lower material consumption vis-?-vis controlling of other expenses also.

The profit of the Company has increased as compared to the previous financial year because of the reasons stated above. The Profit after Tax is at Rs. 201.08 lakhs in the current year as compared to Rs. 87.53 lakhs in the previous year.

Details of significant changes (i.e., change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations thereof, including:

In accordance with the SEBI (Listing Obligations and Disclosure Requirements 2018) (Amendment) Regulations, 2018, the Company is required to give details of significant changes (change of 25% or more as compared to the immediately previous financial year) in key sector specific financial ratios.

  1. Debtors Turnover Ratio: Current Year 11.58:1 Previous Year 7.00:1
  2. Reason for changes: Improved much due to better realization of outstanding and lower credit terms.

  3. Inventory Turnover Ratio: Current Year 0.99:1 Previous Year 1.30:1
  4. Reason for changes: The manufacturing turnover/revenue improved much in the current year due to better control in the inventories as compared to earlier years.

  5. Interest Coverage Ratio: Current Year 2.54:1 Previous Year 1.19:1
  6. Reason for changes: It is improved as the profit before depreciation is better as compared to the previous year.

  7. Operating Profit Margin: Current Year (21.91%) Previous Year (23.99%)
  8. Reason for changes: Nil

  9. Net Profit Margin: Current Year 8.41% Previous Year 2.96%
  10. Reason for changes: It is improved much due to better price realization of the goods sold.

  11. Current Ratio: Current Year 10.72:1 Previous Year 7.51:1
  12. Reason for changes:It is better due to decrease in various Current Liabilities on account of early payments as well as reduction in Current Assets on account of realization of loans and advances.

  13. Debt Equity Ratio: Current Year 0.05:1 Previous Year 0.01:1

Reason for changes:It is increased due to a new term loan for solar project.

Details of any change in Return on Net Worth as compared to immediately previous financial year along with detailed explanation thereof.

During the year under consideration there is an increase in the overall return on net worth after tax which is Rs 201.08 Lakhs as compared to Rs 87.53 Lakhs in 2021-22. The main reason for the increase is due to the better price realization, to some extent reduction in the various types of other expenses and decrease in the raw material prices affected the return on net worth.

Cautionary Statement:

Statements in the Management Discussion & Analysis describing the Companys objectives, projections, estimates, expectations, predictions etc. may be a "Forward Statement" within the meaning of applicable laws and regulations. Actual results, performance or achievements may vary with those expressed or implied, depending upon the economic conditions, Government policies and other incidental/ unforeseeable factors. Important factors that could influence the Companys operations include input availability and prices, demand and pricing of finished goods in the Companys principal markets, changes in Government regulations, tax laws, economic developments within the Country and other incidental factors.