ECONOMIC OVERVIEW
Overview: The global economy was estimated to have grown at a slower
3.20% in 2022, compared to 6% in 2021 (which was on a smaller base of 2020 on account of
the pandemic effect). The relatively slow global growth of 2022 was marked by the Russian
invasion of Ukraine, unprecedented inflation, pandemic induced slowdown in China, higher
interest rates, global liquidity squeeze and quantitative tightening by the US Federal
Reserve. The challenges of 2022 translated into moderated spending, disrupted trade and
increased energy costs. Global inflation was 8.80% in 2022, among the highest in decades.
US consumer prices increased about 6.50% in 2022, the highest in four decades. The Federal
Reserve raised its benchmark interest rate to its highest in 15 years. The result is that
the world ended in 2022 concerned that the following year would be slower. Gross FDI
inflows - equity, reinvested earnings and other capital - declined 8.4% to $55.3 billion
in April December. The decline was even sharper in the case of FDI inflows as equity -
these fell 15% to $36.75 billion between April and December 2022. Global trade expanded by
2.7% in 2022 (expected to slow to 1.7% in 2023).
The global economy is projected to grow a weak 2.9% in 2023, marked by
sustained Russia Ukraine conflict and higher interest rates. Global inflation is projected
to be 6.5% in 2023 (Source: IMF). On the positive side, the reopening of Chinas economy
after the waning of the pandemic, the decline in the European energy crisis and robust US
consumption outlook (despite high inflation) remain positives. Interestingly, even as the
global economy is projected to grow less than 3% for five years, India and China are
likely to account for half the global growth in 2023 (IMF).
Indian economic review Overview:
Even as the global conflict remained geographically distant from India,
ripples comprised increased oil import bills, inflation, cautious government and a
sluggish equity market. India reported an estimated economic growth of 6.8% in FY 2022-23.
India emerged as the second fastest growing G20 economy in FY 202223. India had retained
its position as the fifth-largest global economy and was seen as a principal driver of the
global economy (with China)
India moved up in the Ease of Doing Business (EODB) rankings from 100th
in 2017 to 63rd in 2022.
In 2022-23, total receipts (other than borrowings) were estimated at
6.5% higher than the Budget estimates. Tax-GDP ratio was estimated to have improved by
11.1 percent Y-o-Y in FY 2022-23. The total gross collection for FY 2022-23 was 18.10 lakh
crore, an average of 1.51 lakh a month and up 22% from FY22.
Indias monthly goods and services tax (GST) collections hit the second
highest ever in March 2023 to 1.6 lakh crore. For 2022-23, the government collected 16.61
lakh crore in direct taxes, according to data from the Finance Ministry. This amount is
17.6 percent more than what was collected in the previous fiscal. Per capita income almost
doubled in nine years to 172,000 during the year under review, a rise of 15.8 percent over
the previous year. Indias GDP per capita was 2,320 USD (March 2023), close to the magic
figure of $2500 when consumption spikes across countries.
India is expected to grow 6.8% in FY2024, catalysed in no small measure
by 35% capital expenditure growth by the government. The growth could also be driven by
broad-based credit expansion, better capaci ty utilisation and improving trade deficits.
Headline and core inflation rates could trend down. Private sector investments could
revive.
INDUSTRY STRUCTURE AND DEVELOPMENT
As natural resources are limited, recycling has gained attention
worldwide. Now companies are articulating a vision of using greater portion of recycled
material in their products and formulations. The rubber industry is not an exception to
this. End of life tyres are an important source of recycled rubber worldwide and its
status has changed from waste to resource. The reclaim rubber industry has been developed
around this reality.
A show-case project of benefits of circular economy. Actively promotes
re-use of products derived from ELTs into new tyres, conveyor belts, road construction
etc.
Tinna Rubber and Infrastructure Limited (TRIL) is a pioneer in
manufacturing of crumb rubber modifier (CRM) for bitumen and almost 100K lane kms has
been laid in India with CRMB and our CRM.TRIL has set an example in the industry by
converting Waste to Wealth, by aggressively promoting the concept of recycling of Truck/
Bus, Radial (TBR) tyres for reuse in new tyres, conveyor belts, road construction etc.
TRIL is the only Company present in rubber based products for both road
Bitumen and non road industry and Manufacture value added products from the steel
reconditioning alsoIntegrated at the back end as well, to ensure regular flow of ELTs
from Middle East, Africa and Europe.
TRIL is a leading player in the field of Crumb Rubber and Bituminous
products and the Company has captured a substantial market share by maintaining high
quality, rel iabil ity an d customer sati sfaction. TRI L has established Pan India
presence with manufacturing facilities located at strategic centers and near to hubs of
industrial activity to produce Crumb Rubber powder from end of life (waste)tyres. Crumb
Rubber Powder, which acts as a substitute to natural rubber.
SEGMENT- WISE OR PRODUCT- WISE PERFORMANCE
As a rubber compounder/ recycler of waste tyres your Company is playing
a vital role in caring for environment by using waste tyres, which is otherwise a serious
environmentaland health hazard. TRILs ecofriendly recycling of tyres involves the
following process:
a) Procurement of waste tyres from around the world and process them in
an environment friendly manner, without generating any waste and pollution.
b) TRILs R &D team has developed various value added products from
waste tyres having following innovative applications:
- High Tensile Crumb: for rubber compounds, for use in rubber industry
including tyres.
- Crumb Rubber Modifier: for blending with Bitumen to make rubberized
bitumen.
- Reclaim Rubber : as a raw material for rubber product industry.
- Hi Carbon Solid Steel Shots: for shot blasting, surface preparation
applications.
- Hi Carbon Steel Scrap: for melting and reuse.
The Company has developed and commercialized its products viz. Hi
Carbon Steel Abrasives and Reclaim Rubber/ Ultra Fine Crumb Rubber, Detailed figures of
product wise sales are given in Notes on Financial Statements.
In earlier years Crumb Rubber Modifier (CRM) and other road related
products having application in the infrastructure sector has been the mainstay of the
Companys sales mix, your Company has consciously reduced its dependence on this sector.
OUTLOOK
Improving market dynamics in Tyre recycling with framing of new
regulations is bound to boost the prospects of organised players in the Tyre recycling
business. For instance, the government has proposed new rules for waste Tyre management
that will make it mandatory for manufacturers and dealers to use more waste tyre against
the new ones they sell. The proposed rules under ERP puts the responsibility of
collection & use of waste Tyres and safe transport to only registered recyclers, while
ensuring that the environment is not harmed during its transportation. Moreover, the
Extended Producer Responsibility (EPR) laws, which require the manufacturer of a product
to be responsible for its ultimate recycling, reuse or disposal, has become a significant
waste management approach in recent years in the efforts to increase recycling and
landfill diversion rates. We believe a new policy is in the works which will mandate use
of Modified Bitumen in making new roads. This will create accelerated demand for our
product Modified Bitumen and Crumb Rubber Modifier.
Tinna Rubber & Infrastructure Limited was found in the year 1977
& Today, it is the largest End-of-Life Tyre (ELT) material recycler having a legacy of
over 40 years in the rubber business. It is also the only recycling company having well
diversified application portfolio servicing Infrstructure , Consumer & Industrial
industry.
Business model at Tinna is a prime example of enabling the circular
economy l which involves utilizing the recycled rubber materials as a new raw material for
various application. Process involves 99.5% material recovery from End-of-Life Tyres and
convert them into specialised and high-quality recycled materials. Recycled rubber
materials are then supplied to leading tyre and conveyor belt manufacturing companies and
help them to reduce the consumption of natural rubber and synthetic rubber without
compromising on the quality and thereby, reducing the carbon footprint at the same time.
A report by the Indian Institute of Technology (IIT) has concluded that
Crumb Rubber Modified bitumen which is blend of Asphalt & waste tyre rubber powder is,
if used for road surfacing has significantly lower greenhouse gas emissions and embodies
energy compared to virgin bitumen.
As India too is battling the problem of plastic pollution, Tinna has
looked upon this as an opportunity and is in process to start first pilot plant within
this year to produce composites polymer using waste rubber and waste plastic. Tinna has
invested and acquired a tyre recycling company by the name Global Recycling LLc. in the
Oman, which is a pilot project to recycle approx. 6,000 tonnes of waste tyres annually.
Once the operations are stabilized company vision is to scale it further by increasing its
capacity to three-fold to handle the issue of waste tyre and waste plastic.
In Oman, people are working in tyre graveyards and manually cutting the
tyres which is an extremely harsh and inhuman conditions for the labour as when the sun is
at its peak in this region, working in such condition becomes difficult as well.
On the contrary, Tinna has revolutionized tyre cutting procedure by
setting up containerized machine which is not only mobile but also much more humane and
provides safe and relaxed environment to the labour .This containerized plant is fully
equipped to cut 5000 tyres every day .
We at would like to extend our support to address the issue of waste in
Oman. We seek the support of policy makers to attract investors by providing them
investors friendly work environment and stable policies.
In todays world Recycling is the only industry which not only brings
circularity in economy but also there is 400 times value addition to the waste by
converting it to valuable resource.
The Company has a strong market presence and immense corporate trust
reposed by its customers. The Companys customer base includes prestigious customers
like SEMPERTRANS, MRF, APOLLO, TVS Srichakra, CEAT, JK TYRES and like Indian Oil
Corporation Ltd., Hindustan Colas Ltd., Manglore Refinery and Petrochemicals Ltd.,
Balakrishna Tyres Ltd., Alliance Tire Group (Yokohama), Ralson tyres, DCM Engineering
Products, Hyundai Construction Equipment (India) Pvt. Ltd., Mahindra CIE Automotive Ltd.,
Rico Auto Industries Ltd., Neosym Industries Ltd., Zenith Industrial Rubber Products Pvt.
Ltd., IJM (India) Infrastructure Ltd. Further we are pleased to report that Your Companys
efforts have resulted in successful execution of export contract for supply of products to
Thailand, Turkey and Sri Lanka. We expect to see rise in Companys Export during the year
2022-23 and your Company is exploring opportunity for export in European market.
OPPORTUNITIES AND THREATS OPPORTUNITIES
In light of the integrated recycling companys current position, it has
the unique opportunity to capitalize on its robust supply chain capability and
technological advancements. By leveraging a shared infrastructure, the company can
effectively expand its operations while maximizing efficiencies. Furthermore, the
potential to utilize customer approvals as a confidence-building tool will play a pivotal
role in its expansion across various value chains.
The companys strategic focus on establishing a sustainability
footprint within aligned sectors positions it favorably in the market. Notably, the
company has d e m o n s t r a t e d c o m m e n d a b l e a c h i e v e m e n t s
Infrastructure and other sectors.
A crucial catalyst for the success of such integrated players in the
recycling industry has been the introduction of the Extended Producer Responsibility (EPR)
regulations by the Government of India (GOI). The incorporation of EPR for Tyres and
Plastics, as well as nine other sectors of the economy, has incentivized brand owners and
material manufacturers to invest in collaboration with material recovery and recycling
companies. This collective effort aims to enhance value addition throughout the recycling
process.
In conclusion, the integrated recycling company possesses a strong
foundation for future growth and success, bolstered by its ability to leverage supply
chain capabil iti es, techn ological advan cem en ts, and customer approvals. With a
steadfast commitment to sustainability and a track record of excellence in tyre and
plastic recycling, the company is well-poised to make further strides in the market,
guided by the supportive framework of the GOIs EPR regulations.
• There are opportunities to reduce costs, with increased
efficiency and economies of scale.
• The Company is engaging in the petro chemical refinery business
to enhance its footprint, for marketing Bitumen modifier.
• There is strong export demand for Crumb Rubber and Reclaim
Rubber Compound and the same is being actively explored, besides the existing exports.
THREATS
• End of life / Waste tyres are among the most problematic source
of waste in the world. Incorrect disposal of old tyres can create all kinds of
environmental and health hazards.
• It is estimated that by recycling a kilo of rubber translates
into saving 2 kilograms of greenhouse gases (INAE 2015). If not recycled, tyres are an
enormous global problem because of their nonbiodegradability, flammability and chemical
composition.
• Cost of the debtcontinue to be the key issue. Any increase in
the interest rate will have negative impact on the profitability of the Company.
• Foreign Exchange fluctuation may affect the Company adversely,
as we import our major raw material viz. waste tyres.
• Invent of other better alternative product, in a fast changing
global environment.
• Any increase in taxes and change in Government pol icies may
have negative impact on the Company.
RISKS AND CONCERNS
• Your Company follows a proactive risk management policy aimed at
protecting its employees, assets and the environment, while at the same time ensuring
growth and continuity of its business. Regular updates are made available to the Directors
of the Company in Board Meetings. Key risks identified by your Company are as under:
• Tyres are highly inflammable and your Companys property and
stock are subject to risk of loss due to fire and flood and these are mitigated with
insurance and fire detecting and firefighting equipments and proper security personnel.
Regular training program for employees are being organised by the Company relating to fire
control.
• Any change in Government policies may adversely affect the
demand/profitability of the product.
• Technology obsolescence is an inherent business risk in a fast
changing world and speed of change and adaptability is crucial for survival of the
business.
• The domestic, regional and global macroeconomic environment,
directly influences the demand of the bitumen modifier.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
A system of internal control, commensurate with the size and nature of
its business, forms an integral part of the Companys corporate governance policies.
The Company has a proper and adequate system of internal control
commensurate with the size and nature of its business. Some of the significant features of
internal control systems include:
• Ensuring compliance with laws, regulations, standards and
internal procedures and systems.
• De-risking the Companys assets/resources and protecting them
from any loss.
• Ensuring the accounting systems integrity proper and authorised
recording and reporting of all transactions.
• Preparing and monitoring of annual budgets for all operating and
service functions.
• Ensuring the reliability of all financial and operational
information.
• Forming an Audit committee of the Board of Directors.
• The Audit Committee regularly reviews audit plans, significant
audit findings, controls and compliance with accounting standards and so on.
• Continuous up-gradation of IT Systems.
FINANCIAL PERFORMANCEVIZ - A - VIZ OPERATIONAL PERFORMANCE
The details of the financial performance of the Company are appearing
in the Balance Sheet, Profit & Loss Statements and other financial statements forming
part of this Annual Report. For financial highlights please refer heading FINANCIAL
RESULTS of Directors Report.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
The Company firmly believes that Human Resource is the key driver for
the success of any organization. The Companys human resources policies are carefully
structured to meet the aspirations of the employees as well as the organization. These
policies are implanted through training and other developmental programs. These policies
encourage continuous learnings and innovations. Your Company has a dedicated team of 651
employees as on 31st March, 2023 as compared to 721 employees as on 31st March, 2022. The
Company continues to have cordial industrial relations.
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