DDev Plastiks Industries Ltd

The global economy faced a plethora of challenges during FY 2023-24, owing to several headwinds, including prolonged geopolitical conflicts, supply chain disruptions and elevated inflationary pressures, among others. However, it is poised for steady growth, with projections suggesting a growth rate of 3.2% in CY 2024 and 2025.

On the other hand, India remained a bright spot on the global economy. As one of the fastest-growing major economies, it recorded an impressive growth of 8.2% in the fiscal year under review. This marks the third consecutive year of India's robust performance, with the economy consistently growing by 7.0% or higher. India's presidency of the G20 summit has further enhanced its appeal to international investors. The manufacturing sector, in particular, has benefited from favourable initiatives such as Make in India and the China Plus One strategy, expanding by 9.9%.

At Ddev Plastiks, we have been able to sustain our position as a prominent player in the polymer compound sector, especially in the production of XLPE (cross-linked polyethylene) compounds essential for the power cable industry. Over time, we have also developed an extensive portfolio across five categories, including PP (polypropylene) compounds, engineering plastic compounds, Antifab, Halogen Free Flame Retardant (HFFR) and XLPE, all of which are integral to various applications, from food packaging to automotive components and electronics.

The investments that we have made over the years in our manufacturing facilities, advanced equipment and a state-of-the-art R&D centre have enabled us to secure a leadership position in XLPE and Sioplas compounds. Our largest facility, located in Surangi, Silvassa, equipped with top-notch infrastructure and a world-class R&D centre, is managed by a team of competent R&D engineers. This enables us to maintain a significant market share in both Sioplas (50%) and XLPE (33%) compounds.

As one of the largest manufacturers of polymer compounds in India, we have an installed capacity of 2,37,500 metric tonnes. Our operations are supported by five manufacturing plants situated in West Bengal, Daman and Diu and Dadra and Nagar Haveli. This geographical diversification enhances our logistical e_ciency and considerably lowers freight costs by leveraging our strategic presence on both the Eastern and Western coasts of India.

We value collaborations with leading academic institutions such as IIT Kharagpur and the University Institute of Chemical Technology in Mumbai, which drive continuous advancements in polymer science and technology. Additionally, our careful selection of equipment from esteemed global suppliers in Germany, Switzerland, Italy and Taiwan ensures that we uphold the highest standards of quality and operational e_ciency.

Robust execution capabilities, fiscal discipline and strategic planning have enabled us to deliver a strong financial performance in the year gone by. We close FY 2023-24 with our revenues reaching H 2,431 crore, which is significant considering the increasingly competitive market in which we operate. Our EBITDA for the year surged to H 282 crore, which is a remarkable 52% increase year-on-year while our EBITDA margin stood at 11%. PAT grew by an impressive 75% year-on-year, totalling H 182 crore, supported by a healthy PAT margin of approximately 7%.

I am delighted to share that we have become a net debt-free company in the fourth quarter of FY 2023-24 and are committed to maintaining this position through fiscal year 2024-25 and beyond. I believe that this financial strength will bolster our capability to invest in growth initiatives and seize emerging opportunities.

An emphasis on meeting the growing demand for high-voltage cables by sharpening our focus on niche products has contributed to this strong performance. Despite a 15-20% price correction, our e_orts led to a 15% spike in volumes, significantly improving our margins and driving bottom-line growth. At present, we are expanding our Sioplas and XLPE compounding capacities to cater to the rising demand for high-voltage cables. As part of our strategy to enhance our product o_erings and capacity, we are now set to launch an XLPE compound suitable for cables up to 132 kV, with plans to ramp up this capacity to 222 kV in the near future.

To enable consistent innovation, we are planning to expand our capacity for halogen-free flame retardant (HFFR) cables. This move aligns with anticipated regulatory changes and stringent safety standards. Our objective is to increase our HFFR capacity to 20,000 metric tonnes annually by FY 2025-26, in response to the expected surge in demand driven by the inclusion of HFFR cables in the National Building Code of India for public spaces such as hospitals, schools, airports and train stations.

Another significant development during the past year has been the Federation of Indian Chambers of Commerce and Industry (FICCI) honouring us with awards for Excellence in Exports—Petrochemicals and in the category of Plastics, Polymers and Polymer Processing/ Compounding Chemicals. These accolades reflect the trust and confidence our stakeholders have in our capabilities and highlight the dedicated contributions of our team members.

Sustainability remains at the heart of our operations at Ddev Plastiks. We have taken significant strides in augmenting our solar power capacity by 1 megawatt through a Power Purchase Agreement (PPA) with Amplus Solar, bringing our total installed solar capacity to 1.7 megawatts. This initiative is expected to prevent approximately 37,600 metric tonnes of carbon emissions annually, substantially curbing our ecological footprint.

Speaking of our roadmap for the upcoming years, we have planned an investment worth H 300 crore over three years to expand our manufacturing facilities, address operational bottlenecks and develop new greenfield sites. Through this, we seek to increase HFFR compounding capacity by 5,000 metric tonnes per annum and establish new greenfield sites on Eastern and Western coasts in fiscal year 2024-25. We also aim to expand our HFFR compounding capacity by 15,000 metric tonnes per annum in FY 2025-26. Further, our objective is to scale our polyethylene compounding capacity by 25,000 metric tonnes per annum by FY 2026-27. All these initiatives are aimed at enhancing our competitive edge, meeting the increasing demand and fortifying our position as a leader in high-value polymer compounds.

I am confident that our focus on innovation, capacity expansion and sustainability, combined with robust financials, will enable us to drive continued growth. Before I conclude, I would like to extend my sincere gratitude to our customers, partners, team members and stakeholders for being a part of our journey thus far.

I look forward to your continued trust and cooperation.