OVERVIEW OF THE ECONOMY:
During the year 2022, GDP growth of world economy moderated to 3.1% as
estimated by World Bank and 3.5% by IMF. This was after global growth rebounded from Covid
pandemic crisis and recorded strong growth in 2021.
Last year, world economy was in the midst of a turmoil impacted by a
range of factors including resurgence of covid virus in select geographies, risks created
by the continuing Russian-Ukraine war, surge in oil and commodity prices and inflation
rate, besides geo-political tensions and monetary tightening by top central banks.
RESILIENT INDIAN ECONOMY WEATHERS GLOBAL HEADWINDS:
During the year 2022-23, Indian economy was also stressed by
inflationary pressure, surge in oil and commodity prices, shortage of coal and pet coke,
spiralling inputs cost, high interest cost, depreciating Rupee value against US Dollar,
headwinds from monetary tightening, widening fiscal deficit and rising current account
deficit.
At the same time, the resilient Indian economy managed to weather the
global headwinds and sustained the growth last year in terms of high frequency indicators.
It gained momentum in the fourth quarter with GDP growth of 6.1% surpassing the earlier
estimates. Buoyed by the growth in almost all sectors, economy grew by 7.2% in 2022-23
against the revised GDP growth of 9% in 2021-22.
Last year, with buoyancy in tax revenue and additional resources
mobilised Central Government had fiscal headroom to meet the fiscal target.
SECTORAL PERFORMANCE:
Agriculture and allied sector remained a bright spot in 2022-23 and
achieved the targeted 4% growth in GVA (against the revised growth rate of 3.5% in
2021-22). Apart from the good rainfall reported in both South-West and North-East
monsoons, good storage levels in major reservoirs, improved farm practices and marketing
facilities and increased availability of farm inputs and crop loans bettered the prospects
of farm sector and rural economy.
Last year, despite the increased public spending and improvement in
private consumption, industrial output, especially in the manufacturing sector was
impacted by the high cost of inputs. Index of Industrial production grew by a modest 5.1%
in 2022-23 (against 11.3% in 2021-22). Growth in manufacturing sector rebounded with 4.5%
in the fourth quarter. But, the overall growth last year was a mere 1.3% against 11.1% the
previous year.
CORE SECTOR GROWTH:
The cumulative growth of core sector or infrastructure sector in
2022-23 also moderated to 7.6% (after posting a strong growth of 10.4% in the previous
year) aided by increased production of coal, fertilisers, steel and cement.
CONSTRUCTION & HOUSE BUILDING ACTIVITY:
With increased house building activity and infrastructure development,
the construction sector witnessed an accelerated growth for most part of last year. It
grew by 16% in the first quarter, 5.7% in the second quarter, 8.3% in the third quarter
and 10.4% in the fourth quarter. The overall growth was 10% compared to the revised growth
rate of 14.8 % in 2021-22 when the sector staged a smart recovery from the post Covid
pandemic crisis.
SERVICES SECTOR:
For the second year, services sector recorded a robust growth in
2022-23 with GVA growing by over 9% (on top of the 8.2% growth in 2021-22) aided by good
performance of sub-sectors like trade, transport, IT, communication, travel, tourism and
financial services.
CEMENT INDUSTRY:
The industry witnessed mixed fortunes during the year 2022-23
reflecting wide fluctuations in its growth path. As per Department of Industrial Policy
and Promotion (DIPP) estimates, while there was significant pick up in the construction
activity during the first quarter with a demand growth of over 17% in cement production,
the same trend could not be sustained in the second quarter with a sluggish growth of 1.8%
to 2% only. Though there was pick up in the later months in the cement despatches, the
cement industry witnessed again a negative growth of 1% in March finishing the year with
only at 8.6% growth implying a steep drop in growth in the last 3 quarters. This
inconsistent movement in the demand for cement had a telling impact on the south where the
industry is saddled with huge capacity. As per information available, even in south the
cement industry witnessed a healthy growth of 15% overall in the first half of the year
but had to be content with a growth of around 9% to 10% only in the later period. As per
estimates, while the all India capacity utilisation of cement industry was over 73% with
other regions contributing close to normative capacity utilisation of 85%, the capacity
utilisation in the south was around 65% only.
The year under review witnessed a record increase in the cost of
production particularly during the first half on account of substantial increase in the
price of thermal coal and petcoke. This was compounded by the depreciation of rupee
against dollar by more than 10% during the year. With severe competition in the market
place for market share even at a lower margin, this unprecedented increase in the cost of
production could not be passed on by way of increase in selling price resulting in
substantial erosion of margins. While all India players had a reasonable increase in the
selling price elsewhere in the other regions on account of better demand supply situation,
the industry in south had to reel under pressure with a lower selling price with
uncompensated cost increase.
From November22, there was some relief in cost of production with
the softening of the price of imported coal and petcoke but still the cost increase was
much above the levels prevailing in the previous year, which remains uncompensated.
With the thrust given by the Central Government with higher outlay for
capital expenditure for infrastructure creation and housing, the medium and the long term
prospects augur well for the growth of the industry. However, the continuing
Ukraine-Russia war and its impact on the supply chain position of coal and petroleum
products remain a cause of concern as this could have long term influence on the price of
fuel and oil.
COMPANY PERFORMANCE:
The performance of the company was severely dented during the year
under review on account of significant input cost increases, tough market conditions with
severe competition and subdued realization for cement resulting in drop in margins and
also due to one off expenses on account of provision for impairment of certain investments
and advances.
The production and sales performance of the company for the year are as
under:
Lakh Tonnes
|
2022-23 |
2021-22 |
Increase/
(Decrease) |
Clinker production |
72.98 |
67.60 |
8% |
Cement Production |
97.29 |
88.34 |
10% |
Cement & Clinker sales |
98.93 |
90.70 |
9% |
The companys overall volume of sales was up by 9% marginally
lower than the growth of the industry in the south. As earlier mentioned, with a basket of
plants of various vintage and technology with varying operating parameters the impact on
cost of production on account of steep increase in coal price, diesel, petcoke, power,
etc. was much higher for the company as compared to many of the peers. Low capacity
utilization of only 64% coupled with low blended cement proportion of only 50% in the
overall
sales mix due to the increased infra activity in the region, the
margins for the company for the year were squeezed. Consequently, the profitability and
the liquidity was adversely impacted which resulted in restricting despatches to low
contributing areas of Maharashtra and east which accounted for the lower growth as
compared to peers. The company as a prudent policy took steps to improve the liquidity
through sale of investments in Madhya Pradesh which helped in the short-term to improve
the capacity utilization to around 72% in the 4th quarter as against 60% in the
previous 9 months. The demand charges by the State Electricity Boards also underwent
upward revision during the year. There was also one off charges during the year on account
of provision for impairment of investments and advances. All the above factors resulted in
a negative EBIDTA for the year under review.
The cost per Kcal of fuel increased from about 1.85 in the
previous year to 2.90 in the current year and average rate of power went up from
5.20 per KWH to 7.04 per KWH. These two major factors together with reduction in
blended cement proportion increased the variable cost of production by more than
840 per ton or 31% over that of previous year while net plant realization improved by
200 per ton resulting in substantial erosion of the margins. Accordingly, there was a
negative EBIDTA of 140 crores as compared to an EBIDTA of 478 crores in
the previous year. Interest charges were at 234 crores ( 204 crores) while
depreciation was at 213 crores ( 220 crores) and after netting of the
exceptional income representing profit on sale of investments in Madhya Pradesh of
294 crores and the one off charges for impairment of investments and advances of
114 crores, the loss before tax for the year stood at 407 crores against a profit
of 54 crores in the previous year. After tax and other adjustments, the total
comprehensive loss for the year was at 188 crores as compared to a total
comprehensive income of 231 crores in the previous year.
GOING FORWARD:
The company has plans for improving the liquidity in the short-term
through disposal of some non-core assets and steps are being taken to improve the
operating parameters through refurbishment of some of the plants. The company has also
plans for installing Solar power plants in some of its surplus lands to reduce the overall
cost of power. The required funds for this are proposed to be generated through disposal
of other non-core investments including land for which necessary statutory approvals are
sought from the authorities.
BUSINESS RISK AND MITIGATION:
The company has got a very detailed risk management policy which is
inter-aligned with strategic and operational decisionmaking process. We understand that
effective risk management is the key to protect our operations and earnings from the risk
we are exposed to. The Risk Management Committee consisting of the Board of Directors
regularly review and discuss the risk management framework and suggest mitigation
processes.
The company is exposed to various risks associated with market
competition, material availability, environment and sustainability, regulations, security,
health and safety, credit risk and liquidity risk and so on.
The biggest challenge faced by the cement industry in general and by
the company was the input costs, which are subject to wide fluctuations in the wake of
increase in price of fuel and power and the continuous threat caused by external factors
like the Russia-Ukraine war affecting supply chain management. As earlier informed, due to
vintage of the plants, the impact of this risk on the companys operations is higher
than that of peers. The company proposes to address this issue by refurbishment of some of
its plants to bring them to modern "state of the art" technology which will
bring the efficiency parameters on par with peers and thereby mitigate the risk.
Traditionally, the cement industry in south is saddled with huge supply
overhang resulting in severe competition in the market place restricting the ability of
the companies to pass on the cost increase to consumers. With infrastructure bottlenecks,
moving the surplus cement to the other areas is also difficult resulting in lower capacity
utilisation in the south as compared to the utilisation levels in the other regions. The
company addressed this through introduction of new segments of value added products based
on application like CSK, HSK to broad base its sales and improve capacity utilisation.
With the thrust given by the Central Government to improve the infrastructure and housing,
it is expected that this risk will slowly ease down in the midterm.
The next risk faced by the industry is the ever changing environmental
laws and the compliance thereon on emissions, sustainability, etc which are also areas of
concern. The company strictly complies with all the above regulations with due investments
on controlling emissions of Co2, SOx and NOx and other green gas emissions. The emission
levels at various locations of the plants are directly monitored by the State Pollution
Control Boards and through Ambient Air Quality systems.
The availability of good quality coal and petcoke at affordable prices
for the continuous running of the plant is risk factor to be addressed. The company
addresses this through a mixture of indigenous and imported coal and petcoke and lot of
investments have also been made during the year for usage of alternative fuels including
Refuse Derived Fuel (RDF).
On the power front, the company is reasonably secured with the
combination of power from gas based power plants, Waste Heat Recovery System, Windmills
and thermal power. However, during the year, the supply from cheaper source of power from
APGPCL stopped due to non-supply of gas to them and other issues resulting in impairment
of this investment. The company based on the cost of power per KWH, judiciously used the
power from Open access and increased the usage of grid power which was cheaper than
thermal power from the Companys captive power plants due to record increase in the
price of power grade coal.
The MMDR Act also poses several restrictions and regulations in the
process of getting licenses even for own limestone mines. The amount of environmental
regulations, wildlife clearances, public hearing, land acquisition and the process of
getting leases through auction - all delay the process of obtaining proper mining
licenses. While the company is reasonably secured for its limestone requirements through
valid leases upto 2030, the process of obtaining more leases for its other mines through
auction has also been taken up.
Logistics cost is also a cause of concern with the ever increasing
petroleum products prices and regulatory mandates regarding zero carbon targets and
limited availability of railway wagons for movement. The cost also impacted by the
restrictions of heavy vehicle movement during peak hours. The company has addressed this
through reduced godown movements, increased IGST sales and reduced movements to far off
markets resulting in logistics cost being maintained at the same level as that of previous
year on a per ton basis.
With more exposure to imported coal and petcoke, the company is exposed
to foreign exchange risk which is covered through hedging a portion of the same and this
risk mitigation is being reviewed by the Board periodically.
With more and more dependence on information technology, there have
been risks associated thereon. In addition to data loss, the cyber security also assumes
importance as any attack can impact the business operation and all its assets. The company
management has been carrying out vulnerability study of the systems and impact assessment
audits using experts in the field. Adequate back up system for its critical servers
together with firewalls have been created.
With the profitability being impacted on account of substantial
increase in cost not backed by improvement in selling price, the interest costs of long
term borrowings have also been exposed to fluctuations in rate based on ratings. The
company, however, addressed the same by managing through floating and fixed rates of its
financial liabilities and also through refinancing wherever required to mitigate the risk
at a sustainable level.
Human resources and talent management risk is also a challenge area. To
retain the quality manpower and motivate them is a big task faced by the company. As
earlier indicated, the attrition rate for the company is very low. Lot of pro-active steps
are taken to address the morale, improve working environment, maintain excellent employer
and employee relationship and training being given for developing future managers.
Credit risk has also become part of routine of the cement industry in
general. The company also extends credit to its customers in the normal course of
business. The trade sales are secured through customer deposits, while the exposure in
non-trade which is vulnerable is an area of risk. The company periodically reviews all the
outstanding on a case to case basis and creates provision wherever required based on
expected credit losses.
In addition to the above, the cement business is subject to various
approvals, consents, permits and licenses from various authorities. While the company duly
complies with rules and regulations of the legal framework, corporate governance, public
disclosures, etc. there are certain litigations pending and they are being addressed as
part of routine through engagement of appropriate legal counsels.
HEALTH & SAFETY:
• As a cement company with more than 75 years of existence, the
company is totally committed to employees safety. "Safety First" is the mantra
in all its activities.
• Over a period of years, the company has evolved safety practices
and has built a robust Safety Management System based on our experience which is subject
to change based on the increased level of automation that are taking place.
Safety committees have been formed with representatives from various
units and from the management and workers who periodically visit other plants and conduct
safety audit and suggest improvements.
• The Companys Safety management system not only covers the
employees but also third parties visiting each facility duly recognising their entitlement
for safe and healthy environment.
• The Company has developed a Safety, Health and Environment
Policy (SHE) which is the tool to drive safety programmes across the company.
• SHE policy mentions the objectives, ownership, accountability
for the health and safety of all its constituents and it covers the risk involving right
from receipt of materials in handling, storage, plant operations, mining operations, hot
meal handling, protocols of working at height, etc.
• Extensive safety audits are also conducted and people are
specifically trained for safety practices.
• The Company is committed to maintain a zero harm/zero accident
at all its plants through proper safety protocols.
• As far as health and welfare of the employees, the company has
created facilities for recreation including clubs and various sports activities at its
plants to improve the morale.
• All plants are equipped with proper medical facilities and
ambulance for treatments.
• Safety celebrations at factory and mines are also being
conducted alongwith awards for maintaining best safety practices.
• In addition to providing personal protection equipments,
frequent health check-ups are also conducted for all the employees.
• The Company has well defined audit programme which covers safety
standards and systems and adherence to protocol defined.
ENVIRONMENT AND SUSTAINABILITY:
• At India Cements, sustainability is an integral part of our
business strategy to ensure sustainable living conditions in and around all the factories.
• As part of sustainability, the company always tries to improve
the operating efficiencies, though, in a limited way given the vintage of its plants to
its systemic efficiencies.
• The company also takes various steps to improve the local
environment, improving green area in the plants, in and around its locations, ensuring
reduction in green gas emissions, ensure water conservation and community development to
achieve sustainable environment.
• As already informed, the company is the first to get license for
blended cement proportion to reduce the carbon content in the cement.
• As part of controlling pollution, the company duly complies with
all the rules and regulations through effective monitoring of all the emissions at various
critical locations.
• Raw mix and Fuel mix are suitably altered to ensure compliance
of SOx and NOx standards.
• Afforestation at the Companys plants to conserve the
nature and the bio-diversity are also being undertaken.
• The company has been re-cycling the waste water after treatment
from Sewage Treatment Plants for gardening and other factory purposes.
• To ensure better water management system and to improve the
sustainability, the company has been diverting the surplus water from its mines through
huge investments on pipelines for recharging the nearby village ponds and also have
created ponds in its exhaustive mines for agricultural development.
• During the year under review, while PPC production was
marginally lower than previous year at 50% against 52%, the overall blended cement
proportion including the special application based products like HSK and CSK was at 56% up
by 4% when compared with previous year duly reducing carbon content. The clinker to cement
ratio also improved to 0.726 from 0.737 in the previous year.
• The company is also in the process of installing one more Waste
Heat Recovery System at its Chilamkur plant which will further reduce the carbon load
through usage of the waste heat from the existing system.
COST MITIGATION MEASURES:
As earlier mentioned, the year under review witnessed record increase
in the prices of input materials which was uncompensated in the market place resulting in
constriction of operation and lower capacity utilisation.
It is significant to note that the company has plants of various
vintage with varying operating parameters, which requires major investments for
upgradation in some of the plants to bring the company in line with the peers for a level
playing field.
Despite these, the company however continued its on-going efforts in
reducing the impact of the high cost of production and low capacity utilisation through
various cost reduction measures. The overall blending efficiency including the value added
application based products was increased to 56% from 52% in the previous year duly
reducing the impact of huge increase in the cost of clinker. The additives usage in cement
was also improved by more than 1% during the year duly reducing carbon emission and saving
in cost of production.
With the cost of own power generation substantially moving up on
account of the record increase in the price of coal, the company switched over to usage of
power from State Electricity Boards duly reducing the impact of increase in cost. While
the thermal power cost went up even above 10 per KWH during the year, the average
cost of power however, could be maintained at 7 as compared to 5.2 per
KWH in the previous year through a favourable mix of power.
With the renewed thrust on the usage of alternate fuels, the company
started investing on the equipments for the utilisation of waste materials and RDF and
towards the end of the year and could pick up usage of alternate fuels. The overall
quantity of Alternative Fuel and Raw materials (AFR) was around 0.21 lakh tons for the
year as compared to 0.06 lakh tons used in the previous year. Since the usage started only
towards end of the year, the real impact in this regard could be seen in the years to
come, however, subject to availability of such waste materials.
With the ever continuing increase in the price of packing materials,
the company also swiftly changed over from the usage of high cost paper bags to low cost
BOPP and laminated bags which resulted in reducing the cost of packing per ton of cement
by 6% over the previous year.
However, some major maintenance were carried out in two of its bigger
plants resulting in higher consumption of stores and spares which offset the impact of all
these cost reduction efforts to a certain extent.
All the efforts mentioned above helped in mitigating the increase in
variable cost on account of the runaway increase in the price of fuel and petroleum
products, further impacted by the depreciation of rupee against dollar.
On the fixed cost front, despite increase in DA points and compensation
by way of increments to labour, frequent increase in minimum wages for contract workmen,
the company could restrict its impact to and limit the increase in cost around 7% only.
With increase in fixed demand charges by the State Electricity Boards
in Tamil Nadu, Andhra Pradesh, Telangana, the fixed cost was impacted further.
With rationalisation of go down movements and secondary movement and
improvement of IGST sales and through optimisation of freight rates, the overall freight
and handling cost per ton of cement was maintained at the same level of previous year.
With the price of fuel easing, it is expected that the on-going efforts
will ensure reduction in cost in the years to come.
OUTLOOK:
Global economy is still facing uncertain growth prospects in view of
the repercussions of continuing Russia-Ukraine war, lingering effect of covid pandemic,
tightening of monetary policy and volatility in supply chain and demand. World Bank
expects world economy to grow by 2.1% in 2023, while IMF expects it to be 3%.
Same time, this year too, India with macro economic stability is
expected to remain a resilient economy to weather global headwinds and sustain the growth
momentum.
The Economic Survey for 2022-23 and RBI have projected GDP growth of
6.5% for 2023-24 against the official estimated growth of 7.2% last year. In its latest
annual review, Finance Ministry said India appears to sustain its growth in a more durable
way than before. However, a host of external factors pose a threat to the growth momentum.
On the consumption front, with indications of good rabi crop (wheat),
easing input costs, inflationary pressure and the forecast of a normal rainfall during
South West Monsoon season, rural demand is expected to pick up along with urban demand.
There are also expectations of Centre and States giving push to
spending on infrastructure projects ahead of Lok Sabha Elections in 2024. Budget for
2023-24 has envisaged big ticket infrastructure projects and urban infrastructure
development in tier 2 and 3 cities with a big jump of 33% in capex at 10 lakh
crore apart from the highest ever outlay of 2.4 lakh crore for railways.
This along with the growing preference for homeownership and rebuilding
homes in metro cities, urban and semi-urban and rural India centres augur well for the
brisk construction activity to continue this year and thereby positive demand outlook for
cement.
Cement industry, especially in the South, has built adequate capacity
to meet the healthy demand from housing and infrastructure sectors.
However, margins are expected to come under pressure with intense
competition in the market, logistics and supply chain constraints and increasing
operational costs.
HUMAN RESOURCES & INDUSTRIAL RELATIONS:
The company has been maintaining very cordial relationship with all the
stakeholders over a period of years. With the role of human resources evolving over a
period of time, the company is focused on improving the multitasking of its existing
employees as the overall work force have been sizably reduced over the last few years. The
company has also conducted various programmes for developing future leaders of the
company.
The company has revamped the marketing team with change of guards at
various levels and with renewed focus on achievement of targets on sales, collection and
market development. The employee relationship remains as cordial as before.
The overall permanent employees on the rolls of the company was 1855 at
the end of the year (previous year 1912).
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
Your Company has a well-defined internal control system commensurate
with size, scale and complexity of operation to support the business operations and to
ensure statutory compliance. The internal audit is carried out by a team of professional
firms whose function is defined through internal audit charter, which includes inter alia
transaction audit, systems audit and process audit. In order to maintain their
independence and objectivity, the internal audit function directly reports to the Audit
Committee.
External auditors carry out concurrent audit of all the plants and
offices which adds to the stability of the internal control systems. The detailed annual
audit plan is rolled out and the same is approved by the Audit Committee. Suitable
internal checks have been built in to cover all monetary transactions with proper
delineation of authority, which provides for checks and balances at every stage. The
Company has a strong system of budgetary control which covers all aspects of operations,
finance, capital expenditure at micro level and on a monthly basis reported directly to
top management. All the physical performances and efficiency parameters are monitored on a
daily basis and actions are taken immediately. The Company has an Audit Committee of
Directors to review financial statements to shareholders. The role and terms of reference
of the Audit Committee cover the areas mentioned under the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 and Section 177 of the Companies Act, 2013
besides other assignments referred to by the Board of Directors from time to time.
FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:
HIGHLIGHTS OF FINANCIAL
PERFORMANCE: |
2022-23 |
Crores 2021-22 |
Net Sales / Income from
operations |
5380.81 |
4713.11 |
Other Income |
34.27 |
16.72 |
Total Income |
5415.08 |
4729.83 |
Total Expenditure |
5555.29 |
4251.99 |
Operating Profit |
(140.21) |
477.84 |
Operating Margin %* |
0.74% |
10.10% |
Interest & Finance Charges |
234.16 |
204.02 |
Depreciation |
212.99 |
219.79 |
Profit / (Loss) before
Exceptional items |
(587.36) |
54.03 |
Exceptional items |
180.45 |
0.00 |
Profit / (Loss) before tax |
(406.91) |
54.03 |
Tax Expenditure / Deferred Tax
/ MAT |
(218.36) |
15.05 |
Profit / (Loss) after tax |
(188.55) |
38.98 |
Other Comprehensive Income /
(Expenditure) net |
0.33 |
192.13 |
Total Comprehensive Income |
(188.22) |
231.11 |
* Includes exceptional items.
Note: The increase in turnover was due to increase in overall volume by
9% and marginal increase in the gross sales realisation per ton of cement by around 4%.
However, due to substantial increase in the price of fuel, increase in tariff by
Electricity Boards, etc. the variable cost went up by 31%. The increase in variable cost
alone was more than 820 crores while the increase in net plant realisation and
the contribution from the increased volume together was only 310 crores resulting
in steep erosion of margins. With the increase in salaries and wages and other
administrative expenses and higher demand charges of State Electricity Boards, the fixed
cost also went up resulting in a negative EBIDTA of 140 crores for the year as
against 478 crores of EBIDTA in the previous year. Interest charges were higher
on account of slightly increased borrowings and revision of interest rates while
depreciation was at 213 crores as compared to 220 crores in the previous
year. The extraordinary items represent the profit on sale of investments at Madhya
Pradesh of 294 crores as netted off by the impairment of investments in power
plant at APGPCL of 114 crores resulting in a net income of 180 crores.
After reckoning the other items and tax credits and deferred tax adjustments, the net
comprehensive loss for the year was at 188 crores against comprehensive income of
231 crores in the previous year.
KEY FINANCIAL RATIOS:
Ratio |
|
2022-23 |
2021-22 |
% change* |
Debtors Turnover (Times) |
Revenues from Operations /
Average Trade Receivables |
6.20 |
6.45 |
(3.79) |
Inventory Turnover (Times) |
Revenue from Operations /
Average Inventory |
6.69 |
6.65 |
0.61 |
Interest Coverage Ratio (Times) |
Profit before Finance cost &
Tax / Finance Cost |
(0.74) |
1.26 |
(158.32) |
Current Ratio (Times) |
Current Assets / Current
Liabilities |
1.15 |
0.87 |
32.79 |
Current Ratio - excluding
Current Maturities (Times) |
Current Assets / Current
Liabilities excluding Current Maturities |
1.48 |
1.08 |
36.33 |
Debt to Equity Ratio -
excluding short term borrowings and current maturities (Times) |
Non current Borrowings / Total
Equity |
0.32 |
0.33 |
3.06 |
Debt to Equity Ratio - including
short term borrowings and current maturities (Times) |
Short term + long term debt +
Interest payable on borrowings / Shareholders equity |
0.52 |
0.53 |
1.29 |
Operating Profit Margin (%) |
EBIDTA/Total Income |
0.74 |
10.10 |
(92.64) |
Net Profit Margin (%) |
Net Profit after tax/Total
Revenue |
(3.48) |
0.82 |
(522.47) |
Return on Networth (%) |
Profit after tax (excluding
fair value impairments) / Average Shareholders Equity |
(131) |
0.68 |
(291.99) |
* Figures in brackets represent adverse change
Notes: As pointed out, the year under review was impacted by the
uncompensated cost increase which resulted in a negative EBIDTA for the year. Hence,
ratios for the current year are vitiated when compared with the previous year. The
interest coverage ratios was severely impacted on account of the inadequate EBIDTA which
was also reason for the lower operating margin and the negative net profit margin. With
the reduction in payable and the provision, current ratio was marginally improved during
the year under review.
CAUTIONARY STATEMENT:
Statements in the Management Discussion and Analysis Report describing
the Companys objectives, expectations or predictions may be forward looking within
the meaning of applicable securities laws and regulations. Actual results may differ
materially from those expressed in the statement. Important factors that could influence
the Companys operations include global and domestic supply and demand conditions
affecting selling prices of finished goods, input availability and prices, changes in
government regulations, tax laws, economic developments within the country and other
factors such as litigation and industrial relations.
On behalf of the Board
RUPA GURUNATH Wholetime Director (DIN: 01711965)
N. SRINIVASAN
Vice Chairman & Managing Director (DIN: 00116726)
S. BALASUBRAMANIAN ADITYAN
Director
(DIN: 00036898)
Place : Chennai Date : 7th August, 2023
+91-9892691696
