Today's Top Gainer
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Global economic growth is projected to soften in view of heightened trade tensions and US imposed embargo on Iran leading to higher fuel prices.
INDIAN ECONOMY & PAPER INDUSTRY
Despite weak global sentiments, Indian economy continued to grow steadily as economy recovered post stabilisation of the GST and Govt spending on Infrastrucure continued at higher levels.
Indias GDP is expected to reach US$ 6 trillion by FY 2027 and achieve upper-middle income status on the back of digitisation, globalisation, favourable demographics, and Government reforms.
Indian Paper Industry is mainly dividend into four segments-Writing and Printing, Industrial packaging, Specialty and Newsprint. All the sub-segments are growing in India while Writing -printing segment is under pressure globally. India holds 15th rank among paper producing countries in the world with a total estimated production of around 17 million tonnes. The per capita consumption is around 14 kgs against Asian average of 26 kgs and World average of 58 kgs. India is considered as the fastest growing market for paper in the world. The domestic consumption is expected to rise considerably in the near future. This is also attracting fresh investments particularly from Chinese paper Companies.
As per capita consumption of paper in India is very low as companred to global average, there is ample scope and opportunity for the Industry to grow substantially over a period.
Lack of availability of pulpwood at globally competitive prices and high energy prices, and higher cost of capital, are the some of the major weaknesses of the Industry.
A growing economy, rapidly expanding e-commerce sector, aspirations of a young population provide an enabling environment for growth of the Paper Industry.
In the last seven years, imports of paper and paperboard have risen at a CAGR of 16%. Free Trade Agreements with Countries which have favourable policies for pulpwood Plantations and economic fuel prices is a serious threat to the Indisutry . There is an urgent need to review these FTAs to provide a level playing field to the local Industry.
SOCIAL FARM FORESTRY
Your company has further enhanced tree plantation program under social farm forestry. Approximately 357 lacs seedlings were planted and distributed during the year under the program. We have added an area of 18,911 hectares under the plantations making a total coverage of 1,57,102 hectares. The program helps in enhancing rural income and facilitate sustained availability of raw material to the Mill.
RISKS & CONCERN
Risk is inseparable from the business. Higher wood and energy costs, adverse Govt. policies, Environmental issues and Market risks are some of the concerns associated with the companys operations. The company regularly identifies these risks and undertakes initiatives to mitigate impact by taking appropriate steps.
INTERNAL CONTROL SYSTEM
The company continuously reviews Internal control systems and procedures to ensure conductofbusinesseffectivelyand efficiently. Internal control system ensures: a) Accurate recording of transactions with internal checks and prompt reporting. b) Adherence to applicable accounting standards. c) Periodic review to effectively manage working capital. d) Review of capital investments and long term business plans. e) Compliance with applicable statutes, policies and listing regulations. f) Effective use of resources and safety of assets.
The company reported satisfactory financial and operational performance for the year 2018-19 amid various challenges and constraints.
Human resource development programs are linked with organizational needs and performance. Your company recognizes human resource as its invaluable asset. There are regular activities/ development programs for enhancing skills/competencies of the work-force at all levels. Industrial relations remain cordial throughout the year under review. There are 512 employees on the companys roll.
Paper has a range of applications virtually in every sphere of life and economic activity. Paper industry in India is therefor expected to grow in line with rest of the economy. Even though faced with seceral constraints highlighted above, given proper Policy support, there is ample opportunities for the Industry to grow and prosper.
FORWARD LOOKING STATEMENTS
This Report contains forward looking statements based upon the information available with the company, assumptions with regard to global economic conditions, Government policies etc. The company do not guarantee accuracy of the assumptions and perceived performance of the company in future. It is thus cautioned that the actual results may materially differ from those expressed or implied in the report.