Dear Shareholders,
Warm greetings to you and your families!
After completing 100 years of Goodyear's presence in India last year, I am pleased to
share that in 2023 we are celebrating 125 years of Goodyear's global presence. It
is with this historic milestone that we find pride in all that we have accomplished and we
look forward to the future with strong conviction. India is a key driver for Goodyear's
future growth and we are committed to expand our presence in the Indian market. We
continue to focus on building a "Best in Class" organization with a strong
culture around "Trust, Transparency and Meritocracy".
Financial Year 2022-23 has been a challenging year as we faced many macro-economic
challenges such as persistent high inflation leading to high commodity cost, weak rural
demand, and geopolitical disruption. Despite all odds, your company grew faster than the
industry and gained share of market in the passenger vehicle segment while sustaining its
leadership in the Farm Segment.
Your company has always remained focused towards increasing value of the Goodyear brand
by offering "Best in class" products to end consumers and working closely with
channel partners, thereby facilitating mutual growth. Aligned with this focus, your
company has continued working on key strategic initiatives that have helped us gain market
share during complex business environment. Some of these initiatives included product
portfolio modernization with launch of new contemporary products in Passenger Luxury
and SUV segment, retail distribution with focus on higher share of shelf ,
leveraging technology & analytics to enhance customer connect & productivity of
team and building a best -in -class winning team in market. These strategic
initiatives will also help drive growth in future.
For the Financial Year 2022-23, the total income of the Company was Rs. 2,954 crores, a
20% increase from the same in Financial Year 2021-22. Profit after tax (PAT) during the
Financial Year 2022-23 was Rs. 165 crores as compared to Rs. 138 crores a year ago.
The Board of Directors has recommended a final dividend of Rs. 26.50/- per equity share
of Rs. 10/- each for the Financial Year 2022-23.
Farm Business:
India continues to be one of the largest and most diversified food producers in the
world and agriculture remains a central part of the country's economy. It is the source of
18% of India's GDP and engages 55% of its workforce.
India's agriculture sector has been witnessing robust growth with an average annual
growth rate of ~5% over the last six years. This sector is the largest employer of
workforce in the country. Government continues to focus on this industry by extending a
host of incentives like Direct Benefit Transfers (DBT), Direct Crop Procurement and
Minimum support price (MSP) for increasing farm income. The MSP increase plan for 2023-24
is in the range 5%-10%.
The mid to long term farm tyre industry outlook remains positive and is expected to
grow at mid-single digit for the coming decade. According to Off-Highway Research's
report, The Agricultural Tractor Industry in India, there are many positive factors
driving sales upwards. "Among favorable factors, growth in farm mechanization,
government support, credit availability, priority lending by banks, rural prosperity, and
rising demand for food grains and other agricultural produce are all important."
Year 2022 started with the country recovering from third wave of COVID-19 from
Jan'22-Mar'22 and was a challenging time for industry and individuals across the country.
The demand in the first half of the year (Apr'22-Sept'22) was impacted due to early onset
of summers that impacted crop yield and ultimately compelled the govt. to restrict wheat
exports. Delayed onset and uneven spread of monsoon impacted sowing during the Kharif
season that led to concerns about rising food inflation and tight supplies. Amid dwindling
food grain reserves, government had to impose restrictions on export of rice.
The Country's Farm OE Business continued to focus on maintaining category leadership
through excellence in operational and key account management to deliver enhanced Customer
Service.
In the Farm Replacement channel, the focus continued to be on increasing distribution
footprint, channel extraction along with delivering high quality products and enhancing
consumer experience, making Goodyear easy to buy, own and recommend.
In line with Goodyear's commitment towards delivering excellence in customer support,
regular customer connect programs with OEM & Replacement customers were conducted
during Financial Year 2022-23.
Key macro factors influencing the demand:
• Agriculture Credit: The agriculture credit target will be increased to Rs 20
lakh crore (11% higher vs last year's allocation)
• Rs 7,150 crores has been allocated under Rashtriya Krishi Vikas Yojana (RKVY) to
ensure holistic development of agriculture and allied sectors (2% higher vs last year's
allocation)
• Rs 60,000 crores has been allocated towards PM-KISAN a direct benefit transfer
scheme (No change vs last year)
• Rs. 13,625 crores allocated towards crop insurance (10% higher vs last year)
• The southwest monsoon in 2023 is likely to be normal (Source: Indian
Metrological Department)
• Water storage levels of 146 major reservoirs is 21% higher than average of last
10 years and 6% lower than last year (Source: Central Water Commission)
Consumer Business:
The Consumer Replacement business exhibited faster than industry growth gaiuiug share
over previous year despite macro-economic challen ges such as persistent high inflation,
wea k rural demand, andgeopol itical disruption
From a macro economic standpoint India's pace of GDP growth had slowed down to p.p% in
Q3 of Financial Year 2022-23 after demonstrating 13.5% in first quarter and 6.3% in second
quarter of Financial Year 2022-23. Manufacturing sector continued to reflect decline by
-1.1% Year on Year in third quarter after witnessing already a decline of -3.6% in second
quarter of Financial Year 2022-23. Service sector industries continued to do well on the
back of pent-up demand especially in hospitality, travel, trade which led to a growth of
9.7% in third quarter of Financial Yeareoon-23.
Despite macroeconom ic volatilities, Ooosum erreplacement growth was driven
as a result of the following key initiatives below:
This was a r esult of Fcey initiatives mentioned belowo
1) Product portfolio modernization with launch of new contemporary products : Last year
we introduced our two premium products offerings - Assurance ComfortTred in passenger
segment and EffiaientGrip Performance SUV in SUV segment. These products are targeted
towards luxury segment which is a growing at a fast pace in Indian market
2) Buildingretaildiugributionanyfocllg on Inigher ahare of shelf.
3) Leveraging technology & analytics to enhance customer connect: We launched a
modernized tire portal application with automation of complete orderto cash cycle of our
retailers in the market which has helped
a. Improve productivity of sales team
b. Access of entire Goodyear portfolio to drive portfolio selling and mix up
c. Information on New developments / Products by Goodyear
In mid to long-term, passenger car tyre industry outlook continues to remain positive.
With the shift of consumer preference towards SUV and luxury vehicles, the demand for
larger rim sizes will continue to grow. This trend is expected to shape up the demand of
consumer replacement market in future. In line with this trend, your Company continues its
focus on driving growth in premium segments, which in turn improves overall profitability.
Your Company is also focused on best-in-class products to create differentiation in
market, thereby gaining market share.
Corporate Social Responsibility:
CSR is another key focus area to support and serve our communities better.
During the Financial Year 2022-23, Your Company focused on the following initiatives as a
part of its CSR Program:
Adopt a School:
Education is a fundamental tool for empowering future generations and fostering
societal progress. Since Financial Year 2020-21, through the 'Adopt a School' project,
your Company has supported two government girls' schools in Faridabad, Haryana with needed
skilling, hygiene and infrastructure support. In 2022-23, to enable a safe, secure, and
healthy learning environment for young girls, your Company supported further upgradation
of school infrastructure including sanitation and rainwater harvesting units, with an
additional focus on awareness building on menstrual hygiene. The Company also distributed
books to —100 school students to crack competitive exams for government scholarships.
Crop Residue Management for clean air and better life :
Your Company has taken a proactive stance in combating pollution and promoting
sustainable practices. With the growing concern over environmental degradation, a Crop
Residue Management project has been implemented across 19 villages in Barnala, Punjab
benefitting ~8,600 farmers and 46,000+ acres of farmland. This was enabled through
donation of 23 super seeders, 10 rotavators with seed drills, 6 M.B Ploughs, 1 Mulcher,
and 1 straw composting unit to village cooperative societies. Coupled with awareness and
sustainable behavioral change campaigns, your Company encouraged ~94% of the farmers in
the region to adopt alternative stubble management methods. These efforts will result in
reduction of carbon emissions and improvements in soil and air quality in the region.
Catch the Rain:
To enable scientific mitigation efforts in water scarce regions, Your Company has taken
steps towards water conservation in Faridabad through the project "Catch the
Rain". Under this initiative, a rainwater harvesting unit was created in 3 police
stations in Faridabad. This initiative has led to creation of recharge potential of ~3.3
million litres of groundwater per annum.
Safer Faridabad:
Recognizing the importance of creating a safe environment for women, Your Company has
launched "Safer Faridabad" project that aims to empower women through awareness
and self-defense sessions to protect themselves. Under this initiative, Your Company
supported the Faridabad Police with a Customized Mobile Awareness Van aimed at spreading
awareness on women's safety in public spaces like schools and colleges. Under this
initiative, ~330 female students have also been trained in self-defense techniques and
equipped with safety toolkits
Overall, we are optimistic about the economic outlook and long term trends that are
driving growth of our industry. We are well placed to offer great products to meet
evolving consumer needs and deliver strong performance in the years to come.
At last, I would like to thank our valued shareholders, our employees, our customers
and other stakeholders for their continued support, guidance, and faith in us.
Wishing you and your families the very best for the future.
| Best Wishes, |
| Sandeep Mahajan |
| Chairman & Managing Director |