LETTER TO SHAREHOLDERS
Navigating Economic Challenges with Resilience
Dear Shareholders,
Global Economic Dynamics
The year began with cautious optimism as we observed a recovery in
sales across various sectors.
The previous period had been marked by significant disruptions in
supply chains and increased costs, primarily due to unstable freight rates. However, as
the year progressed, a stabilisation in shipping costs played a crucial role in restoring
confidence among businesses and consumers alike.
This recovery was further supported by controlled inflation rates
globally, thanks to the effective monetary and fiscal policies implemented by central
banks and governments. These measures ensured that consumer purchasing power remained
intact, fostering economic growth and market stability.
As the year unfolded, the global economic landscape continued to
evolve. Rising inflation rates prompted central banks worldwide to increase interest rates
to curb consumption. While these measures were necessary to control inflation, they had
significant repercussions on industries sensitive to borrowing costs. The construction and
renovation sectors, for instance, faced increased financing costs, leading to project
delays and cancellations. Additionally, regional economic challenges, such as the
recessionary effects experienced in Western Europe, added to the pressures faced by
businesses.
These combined economic difficulties highlighted the interconnectedness
of global markets and the need for businesses to remain adaptable and resilient.
The economic challenges of the year were particularly pronounced for
our Company. The reduction in credit limits by our banking partners significantly strained
our working capital, restricting our ability to purchase raw materials and impacting our
production capabilities. This necessitated a reassessment of our financial strategies and
the exploration of alternative ways to manage cash flow and maintain business continuity.
Despite these constraints, we remained focused on optimising our
resources and improving operational efficiency. Our team demonstrated remarkable agility
in adapting to these challenging circumstances, implementing cost-saving measures and
streamlining processes to maintain productivity. Geopolitical instability also played a
significant role in shaping the year's challenges. The renewed conflict in the Israel-
Palestine region had far-reaching consequences on global trade and logistics, leading to
increased shipping rates and prolonged shipping times. These disruptions affected our
supply chains and had a direct impact on our sales, particularly in markets that accounted
for a significant portion of our revenue. The heightened risks and increased costs
associated with these geopolitical events further strained our profit margins and
operational efficiency.
Adapting to Market Dynamics
Despite the numerous challenges, our financial performance for the year
reflects our resilience and adaptability. We achieved a total operating revenue of ?155.10
Crores and a net profit of ?1.35 Crores.
These results demonstrate our ability to navigate through challenging
times while maintaining a focus on long- term growth and sustainability.
Our strategic initiatives, including the optimisation of existing
resources and the implementation of cost- saving measures, played a crucial role in
achieving these outcomes.
Our commitment to excellence and customer satisfaction remained
unwavering throughout the year.
We continued to invest in innovation, quality, and sustainability to
meet the evolving demands of the global market. Our dedicated workforce, supported by an
efficient supply chain, played a pivotal role in driving our success in this competitive
landscape. Their tireless efforts and dedication have been instrumental in maintaining our
market position and delivering value to our customers.
Building for the Future
Over the past several years, we have laid a strategic foundation for
our growth and prosperity. Despite macroeconomic challenges and a complex operating
environment, we persevered, investing time and resources in new capacities and
initiatives. Our venture into quartz production, initially hindered by
COVID-19 and unexpected duties, demonstrates our determination for
growth. The reversal of the Anti- Dumping Duty (ADD) has opened new opportunities for us
in the quartz business. Our operational advancements, particularly the Jaipur processing
plant, highlight our commitment to strategic improvements. This plant, designed to process
material from Rajasthan, plays a crucial role in our granite business's success. We
transitioned from a made-to-order model to a stock-and-sell approach, adapting to the
evolving needs of our customers and the widespread shutdown of mines. This shift has made
us more resilient and empowered our customers to make quick, informed decisions from an
array of ready-to- ship products.
Technological adaptations, such as the implementation of Multi- Wire
technology, have allowed us to process granite mined from Rajasthan more efficiently. Our
greenfield plant in Jaipur, established in 2019, is specifically designed for this
purpose, enhancing our production capabilities and allowing us to meet the diverse needs
of our customers.
Our quartz plant, already operating at 63.75% capacity, is expected to
significantly contribute to our growth. With a strategic investment of ?20 Crores, we plan
to double our capacity at the right time.
This expansion, coupled with our commitment to develop high-end designs
and optimally utilise the quartz facility, will drive our revenue growth and profitability
in the coming years. We have also focused on strengthening our financial position by
improving cash flow management and seeking alternative financing options. These efforts
have enhanced our financial resilience and positioned us to capitalise on emerging
opportunities in the market.
Looking ahead, we see the potential of our strategic initiatives
reflecting positively on our financial performance from FY25 onwards.
The anticipated easing of interest rates and a more favourable
operating environment offer a promising landscape for Aro granite industries limited. We
are ready and eager to seize emerging opportunities, strengthen our market position, and
pivot towards significant growth and success.
In conclusion, FY24 has been a year of resilience and strategic focus
for Aro granite industries limited. We have navigated through significant economic
challenges with determination and adaptability. Our performance reflects our ability to
manage risks, optimise resources, and maintain a focus on long-term growth. We are
confident that our strategic initiatives will position us well for future success. As we
move forward, we remain committed to innovation, quality, and customer satisfaction. We
will continue to invest in our people, processes, and technologies to ensure that we
remain at the forefront of the industry. Our diverse product portfolio, coupled with our
strong market presence, provides a solid foundation for sustainable growth in the years to
come.
We extend our heartfelt gratitude to our shareholders, employees,
customers, and partners for their unwavering support and trust.
Your confidence in our vision and capabilities has been a source of
strength and motivation. Together, we will continue to build a stronger, more resilient
Aro granite industries limited, ready to seize the opportunities that lie ahead and create
lasting value for all our stakeholders.
Thank you for your continued faith in Aro granite industries limited.
We look forward to a future of shared success and growth.
Warm regards,
Sunil Kumar Arora
MANAGING DIRECTOR
Sahil Arora
WHOLE TIME DIRECTOR