Dear Shareholders,
It is heartening to be an integral part of India's construction
industry, which * is poised become the third largest globally by 2025. As India emerges as
one of the fastest growing economies of its size in the world over the next : decade, the
construction sector will be a key contributor. It is the second- 1 largest employer in the
country and has forward and backward linkages across around 250 other sectors of the
economy. In the post COVID period, i construction activity in GDP terms has seen double
digit growth year on year \ and the trend is expected to continue over the next few years.
According to j a report ResearchandMarkets.com, a reputed global firm, despite near-term 3
challenges in certain areas, the medium to long term growth story in India S remains
intact. The growth momentum in the sector is expected to continue z with a CAGR of
9.4%, and its output in the country is expected to reach Rs. 36,221 billion by 2028.
The flourishing housing market, coupled with the government's sustained
and massive infrastructure push, has driven the construction market growth over the last
three to four years, and is expected to continue over the next 4-5 years. The fast-growing
Indian population and economy are among the leading factors that have driven the demand
and supply of homes in India. Robust government expenditure in the sector is another
factor supporting the growth of the residential construction market in India. Despite an
increase in underlying prices and the highest interest rates in six years, the housing
market continued to perform well in CY2023. In fact, the sector registered all-time high
sales as buyers snapped deals. The buoyancy in this market is expected to remain over the
next few years. In the commercial space, investment in new data center projects is also
expected to give a fillip to construction opportunities.
As you are aware, within the construction space, BL Kashyap focuses on
civil construction, which primarily deals with all aspects of building related structures.
So, clearly, in India today and in the future, there is significant scope of leveraging
opportunities and growing our business. However, while we are poised to leverage these
market opportunities and significantly grow our business, we have a well calibrated
approach. As a Company with strong experience in this space, we are also aware of the high
importance of being involved in projects that are executed in a timely manner. Long delays
in project execution affect our cash flows and attract much higher working capital needs
than what is optimal. We lay a lot of emphasis at the planning and development stage even
before securing orders, so that the project timeline deviations are minimal. Consequently,
while aggressively exploring market opportunities, we are selective in our final project
bidding and securing process. This approach is at the core of BL Kashyap's business
strategy as it moves out of a difficult phase due to certain past issues with its
investments in the real estate space and is well poised to move to a strong round of
growth.
At BL Kashyap we are continuously driven to be recognized as a leader
for high quality, on time construction, while serving all our stakeholders with the
highest ethical standards. Throughout the delivery chain of a project, we thrive on our
strong value engineering inputs that are carried out with transparency. Over the
years, we have delivered marquee projects for our well-entrenched
customer base, who are mostly in the private sector. We are today working on reaching out
to a wider range of customers and increasing the base. This also includes a move towards
some marquee government sector project developers as well, with a well- spelled-out
objective of increasing the share of government projects in our order book.
The financial performance in FY2024 clearly spells out the way the
Company is evolving after a difficult phase. As a consolidated entity, while total
revenues grew by 11.2%, net profit more than doubled. Much of the financial cost due to
legacy issues is now behind us, and the financials firmly reflect the performance of the
core EPC business. Most importantly, cash flow from operations for the consolidated entity
increased from Rs.19.5 crore in FY2023 to Rs.78.8 crore in FY2024. The focus on minimizing
project related working capital requirement by stressing on improving flows has been at
the heart of the Company's execution ethos. Today, the financial results clearly spell out
this objective. This will be key to increasing the number of projects under execution and
growing the business as we go forward without resorting to large levels of corporate debt.
Clearly, operationally and financially, the foundation has been laid for the next level of
growth, which is to be achieved over the next three to four years. The Company has been
building city skylines and contributing to society through decades in its area of
operations. Over the years, we have been part of the nation's development process, be it
developing buildings and structures for healthcare, education, institutions,
manufacturing, hospitality, residential, offices or shopping malls. We have also
contributed to the transport network by being involved in the construction of metro
stations, railway stations and airport buildings. In fact, the largest IT campuses and
office parks across the country have been built by BL Kashyap. While the structures we
have developed speak volumes for our civil EPC capabilities but in the industry what we
are driven to be recognized for is the processes that we adopt, which speak for its high
levels of transparency and integrity. Above all, we deliver quality while nurturing
relationships across the industry and its supply chain.
We continue to believe in investing in technology to deliver
efficiencies across the construction process and have also started investing in a
proactive manner on efficient capital equipment that creates a competitive edge for our
business. We are working on further expanding our pan-India presence widening the depth of
relationships we have across the customer base.
At this juncture, I would like to put in a special word of gratitude
for all who work at our Company and those who are associated with us as service providers.
We have very long-lasting relationships with most and feel privileged to nurture these
further and move forward as a composite team.
We have taken many steps to lay the foundation for the next level of
growth through FY2024. I strongly believe that the journey we are on will deliver
sustained strong profitable growth for you - our shareholders. I thank you for reposing
faith in our business and look forward to the continued support.