Letter to Shareholders
Leading the way to the future
Dear Shareholders,
This has been a great year for our Company, highlighted by significant
achievements, strategic initiatives, and remarkable growth, all emphasised by our
commitment to growth and sustainability.
The year that was
Let me start with our financial performance in FY24.
It reflects our strategic initiatives and operational foresight.
Revenue from Operations surged to Rs 243 Crores, a robust increase from Rs 200 Crores in
FY23. EBITDA for FY24 stood at Rs 56 Crores, marking a 12% YoY growth, while Profit After
Tax (PAT) reached Rs 31 Crores. Despite slight decreases in both EBITDA and PAT margins,
due to an increased spend on marketing as we entered newer markets, our overall
profitability saw marginal improvement, reinforcing our financial stability. On the
operational front, for FY24 the volume growth was 31 % YoY to 6,00,149 cubic metres.
We have now entered a productive phase in our joint venture with Siam
Cement Group (SCG). The JV, Siam Cement BigBloc Construction Technologies Private Limited,
began production of AAC blocks and AAC panels with a capacity of 250,000 cubic meters per
annum in Q4FY24. This collaboration combines SCG's technical expertise with our market
acumen, setting the stage for a future filled with innovation and growth.
Additionally, our capacity expansion at the Wada plant is well
underway, set to double from 250,000 to 500,000 cubic meters per annum in FY25. Once
completed, it will be the largest single location AAC block capacity in India. This
strategic move is also poised to make us the largest AAC block manufacturer in India by
FY25. Our dedication to sustainable practices is further exemplified by receiving
eligibility certificates for subsidies and applying for carbon credit registration at
VERRA for the Wada plant.
This year, we completed a 450-kilowatt solar installation at the
Umargam plant and are in the process of installing a 625-kilowatt solar plant at the Wada
unit. These initiatives not only enhance our green energy capabilities but also underscore
our commitment to reducing our carbon footprint.
While we faced challenges such as labour issues at construction sites
due to elections, we remained resilient. Our focus on increasing capacity utilisation and
revenue growth is pivotal to maintaining our margins. Entering new markets initially
impacted margins due to marketing expenses, but we are confident that these investments
will yield substantial long-term benefits.
Expanding markets and clientele
We expanded our market reach to newer regions like Nashik, Nandurbar,
Dholia, Rajkot, Jamnagar, Mundra, Udaipur, Jalgaon, Bharwani and many others.
Additionally, we have been concentrating on increasing our customer
base and have added new clients like Birla Estates, Afcons Infrastructure, Nyati Group,
Symbiosis Educational Institution, Vilas Saudagar, JSW Steel, Reliance Life Sciences, R.
K. Developers, Alembic Limited, Dorsi Group, Sethia Infrastructure, Puravankara Group, New
Consolidated Construction, Welspun Group and more.
Our strong and enduring partnerships with over 100 top realtors and EPC
players across four states continue to drive our growth and reinforce our reputation as a
trusted partner in the industry. Our strengths lie in our robust manufacturing facilities,
strategic joint ventures, seamless logistics, reliable product quality, and expansive
sales and distribution network.
Another reason which has immensely contributed to the growing adoption
of our products like AAC Blocks is the favourable price parity between red bricks and AAC
blocks in recent years, especially after the pandemic. The added benefits of AAC blocks,
such as time savings and other efficiencies, further enhance their appeal and drive
increased adoption.
Our growth strategies are centred on penetrating new markets,
modernising manufacturing facilities, expanding distribution networks, growing our
customer base, and increasing our product portfolio. We are trying to identify different
markets, looking at geographies in Southern India somewhere near Bangalore, or Chennai,
and one more in Northern or Central India which we shall be taking up in the current
financial year.
The sustainability edge
Sustainability is not merely an element of our business model. It is
intrinsic to the products we create and forms the cornerstone of our future. From concept
to execution, our operations are deeply embedded in environmental consciousness,
seamlessly integrating sustainable practices into every facet of our products, processes,
and systems.
As the first Company in India to register and operate plants under the
carbon credit registry, we generate approximately 50,000 to 60,000 carbon credits
annually, with the potential to reach 150,000 to 200,000 units post-expansion, which will
directly add to our bottom line. In the current year, we are looking to install rooftop
solar plants at all our factories as per the permissible government rules, thereby further
reducing our carbon footprint and also improving our operational efficiency.
With growing awareness, builders, architects, and engineers are
striving to design buildings that minimise the overall impact on human health and the
natural environment. They aim to achieve this by efficiently using energy, water, and
other resources, and reducing waste, pollution, and environmental degradation. Our AAC
blocks are crafted to be a superior alternative to traditional building materials,
aligning with these goals and fostering greater adoption in the construction industry.
Opportunities and outlook
The construction industry is experiencing a dynamic phase of growth and
transformation, driven by rapid urbanisation, infrastructural development, and increasing
emphasis on sustainable building practices. With the Indian government's focus on
infrastructure projects such as the expansion of the national highway network and smart
city initiatives, the demand for innovative and sustainable building materials is on the
rise.
Among these, Autoclaved Aerated Concrete (AAC) blocks and AAC panels
are gaining widespread acceptance due to their superior properties, including lightweight,
thermal insulation, sound absorption, and environmental benefits. These materials not only
contribute to faster construction times and reduced costs but also align with global
sustainability goals, making them an ideal choice for modern construction needs. As
BigBloc Construction leverages these industry trends, we are well- positioned to
capitalise on the burgeoning demand and reinforce our market leadership, ensuring a
promising phase of growth and innovation for our Company.
Looking ahead, we remain optimistic about our business outlook, the
introduction of AAC panels is expected to contribute to our business from the current year
onwards, further bolstering our financial performance.
The introduction of AAC panels is expected to contribute to our
business from the current year onwards, further bolstering our financial performance.
BigBloc Construction is on the brink of substantial growth, driven by
strategic capacity expansion plans, and targeted efforts to penetrate the Indian market
and establish a nationwide presence. These initiatives align perfectly with our vision of
becoming a leading industry player, providing the momentum needed to achieve this goal.
I would like to extend my heartfelt gratitude to our shareholders for
their support and trust. Your confidence in our vision and strategy inspires us to strive
for excellence in everything we do. I also want to express my appreciation to our
employees for their dedication and hard work. Your commitment to our mission is the
driving force behind our success. Thank you for being a part of our promising journey.
Sincerely,
Narayan Sitaram Saboo
Chairman & Executive Director