Economic Overview
FY 2020-21 was predominantly about the Covid-19 pandemic and individuals, societies,
companies & nations managing the pandemic. We saw a decline in the pandemic towards
the end of the fiscal year before the second wave hit India in the month of March 2021.
The global economy contracted by 3.3% in FY 2020-21. Advanced economies showed a
steeper decline of 4.7%, whereas emerging markets and developing economies declined by
2.2%. All economies except China went into recession, China showing 2.3% growth in the
economy. The global economy is expected to see a rebound in the second half of FY 2021-22
with vaccine optimism leading to further opening of economies. Governments & Central
banks are expected to maintain supportive policies until the recovery is firmly underway.
The strength of recovery globally will depend on the success of the vaccine roll out.
Initial signs of pick up in business sentiment is evident in terms of better GDP numbers
across the developed world, falling rates of unemployment and a general buoyancy in stock
markets globally.
The Indian economy contracted by almost 8% (as compared to growth rate of 4.2% in the
previous fiscal year), making FY 2020-21 the first year of contraction since 1980. India
saw sharper decline than other key economies due to a strict & early lockdown to
control the spread of Covid-19. . However, India saw a V-shaped recovery since Q3 FY
2020-21. Amidst pandemic & lockdown conditions, digital adoption saw acceleration and
industries are using various digital platforms for transactions & operations. The
Reserve Bank of India (RBI), and the central & state governments provided critical
support to the economy during this crisis. Even though the second wave of the pandemic has
affected industries again from March 2021 to June 2021 due to partial lockdown &
restrictions, India is hoping for better recovery in rest of the fiscal year 2021-22. In
this context is heartening to note that despite rising inflation (both WPI and CPI), RBI
has chosen to support the incipient recovery process via its accommodative monetary
policy. Also supporting policy level measures by the government like continued emphasis on
infrastructure, extending the employee guarantee scheme, direct benefit transfers,
extension of the negative list for defence imports, etc will go a long way in giving a
fillip to demand as well as investment.
Covid-19 & the Impact on Your Company (WIL)
WILs manufacturing facilities at Walchandnagar, Satara, Dharwad & all offices went
under lockdown & restrictions as per government guidelines for first & second wave
of pandemic. WIL took all the necessary precautions during operations to ensure health
& safety of all employees and their families. Your Company is ensuring utmost safety
of its employees by following measures such as vaccination camps for factory employees,
usage of masks/gloves, regular temperature screening, setting up of disinfectant
facilities, allowing workforce to work with social distancing, conducting comprehensive
factory sanitization and strengthening work from home culture for our offices in the
cities.
A wide business portfolio and factory locations that are away from highly affected
areas & cities gave WIL a slight edge and natural protection from the pandemic. Even
though the lockdown period affected operations, especially supply chain in Q1 FY 2020-21,
WIL showed appreciable improvement in the operations during unlock period with better
planning, discipline and dedication of our employees.
Performance Overview
Summary of the revenue & profitability for FY 2020-21 as compared to previous
financial year is tabulated below:
Rs.in Lakhs
| Particulars |
FY 2020-21 |
FY 2019-20 |
| Total Income |
35,067 |
31,822 |
| EBIDTA (Before Exceptional Items & Exchange Currency fluctuations) |
4,685 |
4,780 |
| EBIDTA (After Exceptional Items & Exchange Currency fluctuations) |
4,478 |
4,406 |
| Profit / (Loss) Before Tax (PBT) |
(5,724) |
(6,546) |
| Profit / (Loss) After Tax (PAT) |
(5,724) |
(6,546) |
| Cash Profit / (Loss) (Including Exceptional Items) |
(3,428) |
(4,247) |
| Cash Profit / (Loss) (Excluding Exceptional Items) |
(3,428) |
(3,268) |
| Fully diluted EPS |
(15.04) |
(17.20) |
(All figures in INR lakhs except EPS, which is an absolute number)
In spite of the disturbance due to pandemic and sales affected in Q1 FY 2020-21, WIL
bounced back to have better income in subsequent quarters making this years revenue
higher than that of previous fiscal year. Higher top-line in FY 2020-21 definitely shows
improvement in operations, optimal use of manufacturing capacities and improved processes
in the year. One of the most important measures in such times is cost control and cash
conservation and your company has relentlessly worked towards this objective through
measures like reduction of subcontracting activities, reduction of wastages on the
shop-floor, liquidation of unwanted material, etc.
Your company has successfully completed execution of important projects including
OPV-Gearboxes for Goa Shipyard Limited, Hairpin Heat Exchangers for NPCIL and various
components for ISRO & Indian defence. WIL has also supported government in fighting
the pandemic with supply of pressure gauges to DRDO for oxygen generating plants. In
2020-21, WIL has widened its business portfolio with establishment of two more businesses
viz. Process Equipment Division (PED) & Railways. Also a series of steps were taken to
strengthen product businesses i.e. completion of a strategic assignment to scale up the
Crushing & Grinding business, improved customer connect via "Voice of
Customer" exercises, creation of an umbrella structure for the Spares and Services
business, initiation of new development for more efficient and higher capacity products
like Centrifugal Machines and selective upgradation of critical equipment.
WIL has a healthy order book of INR 762 Cr as on 31st March 2021.
Hi-tech manufacturing covers most of the order book along with residual execution of
EPC projects. Aerospace division carries the highest order book covering 32% of the total
orders; which is a positive sign indicating your companys inclination towards hi-tech
manufacturing for positive impact on the bottom-line.
Digitalization & Automation @ WIL
Amidst covid-19 pandemic, WIL has adopted digital platforms to communicate &
transact, ensuring smooth operations with social distancing. Along with communication
platforms, WIL has actively started investing in digitalization & automation of
processes; which will result in faster & accurate processes with better control. Some
of the initiatives at WIL include Automation in production booking on the shop floor,
Barcode system for better inventory control, automated Supplier Relationship Management
(SRM), Business Intelligence (BI) system, and more. Your company is also trying to
establish itself through digital marketing with an active presence on social media, a
revamped website and better brand awareness. We also plan to leverage the power of data -
transactional, operational and financial through "Data Analytics" in order to
gain more insights into our working, aid in decision making at all levels and thereby
improve systems, processes and profitability.
Human Resources (HR)
The year gone by was challenging for industries in many ways with a necessity to handle
the pandemic & manage the workforce accordingly. Our HR team was instrumental in
caring for all our employees and family members affected by COVID. WIL has always given
importance to professional development of the talent with opportunities & motivation.
Emphasis on training and development of the workforce has been the focus area.
Additionally, competency building programmes for leadership development and various
engagement initiatives have been undertaken to sustain the employees motivation and
maintain a harmonious work culture. Town-hall meetings as well as meetings between
staff/workmen & top management have ensured dissemination of strategic direction &
thinking across all levels within organization.
Risk Management & Internal control
The biggest risk at this time is clearly the uncertainty due to the pandemic affecting
employees & operations. Your company has taken appropriate measures to mitigate this
to certain extent by promoting work from home policy in offices wherever possible,
selective attendance in offices as per guidelines, vaccination camps at factory, exploring
ways for steady oxygen gas supply through collaborations, etc. WIL could successfully
manage the pandemic in FY 2020-21 & is ready for the uncertainty to plan risk
mitigation in near future. Another concomitant risk which we have faced is the rise in
input cost particularly the price of steel which can affect profitability. However we have
been alert to the situation and have taken mitigation measures like price revisions
wherever possible, strategic buying, value engineering, etc.
Risk assessment & planning for mitigation has always been an annual exercise at WIL
with periodic reviews throughout the year. Types of risks & priorities get modified
with the changing business profile, economic scenario, and other critical external and
internal factors. With a clear strategic decision, WIL would be focusing on the strategic
hi-tech manufacturing business rather than the erstwhile EPC business. In the current
scenario, WIL has adopted a balanced approach of stringent project management in case of
newly accrued manufacturing orders and phase-wise completion & clearance of legacy EPC
projects to effectively mitigate this risk.
In addition to the above, our internal audit function has a strong mechanism for Risk
Based Internal Audit (RBIA) for end-to- end processes & necessary control, transaction
audit to ensure monetary transactional accuracy, and accounting & control audits for
various process transactions in the ERP system for ensuring proper discipline in the
system.
Technology Upgradation & Product Development
WIL continues to be cognizant about emerging trends & importance of technology
upgradation. We are continuously improving our manufacturing capabilities through
automation as well as manual process improvements. Especially, our product business
portfolio has tremendous scope for product development through advanced offerings to the
customer. Technological advancements at the shop floor will help to save the manufacturing
time & improve quality of the products, whereas product development will enable WIL to
offer advanced features for our product to customers & to expand our product
portfolio. WIL has also started to explore application of Internet of Things (IoT) in
processes as well as products to have smart systems, more data, prediction capabilities
and more control. Your company is also keen on increasing its geographical footprint by
targeting the export market for identified products.
Strategic Directions
Your company has done a comprehensive exercise to chalk out strategic directions for
the organization with a structured approach & a defined path towards fulfilling our
aspirations in coming years. The immediate focus areas include revamping of processes
including automation, building & nurturing talent and implementing a detailed
succession plan, improving execution capabilities, investment in technological
advancement, and expanding markets & product portfolio. A systematic work culture
towards these strategic directions is expected to help your company achieve greater
heights in years to come.
Cautionary Statement
The statements in the "Management Discussion and Analysis Report" describe
your Companys objectives, projections, expectations, estimates or forecasts which may be
"forward-looking statements" within the meaning of the applicable laws and
regulations. Actual results may differ substantially or materially from those expressed or
implied therein due to risks and uncertainties. Important factors that could influence the
Companys operations, inter alia, include global and domestic demand and supply conditions
affecting selling prices of finished goods, input availability and prices, changes in
Government regulations, tax laws, economic, political developments within the country and
other factors such as litigations and industrial relations.
+91-9892691696
