From the Chairperson & Managing Director
"Be the change you wish to see in the world."
— Mahatma Gandhi
Dear Shareholders,
KCP group finds its roots in the rich legacy of fair, transparent and ethical
governance practices, many of which were in place even before they were mandated. The
group has been creating success stories in the Heavy engineering, Cement, Hospitality,
Sugar, Energy and Turnkey machinery supplies for Sugar and Steam boiler businesses, by
focusing on best-in-class products, supplier management systems, external partnerships and
community initiatives.
When we look back at all these wonderful years of building our group, one aspect shines
through the entire journey as a guiding star. It has been our extraordinary focus on
sustainable value creation for all our stakeholders.
India's growth rate continues to be resilient with robust progress in highways and
railways, driven by Government initiatives like, Bharatmala, Sagarmala, Gati Shakti
schemes, combined with policies like Make in India. The Indian economy is acknowledged to
be the fastest-growing large economy by major multilateral organizations. India is
estimated to remain a bright spot in an otherwise lack- lusture world economy.
In terms of our financial performance, we delivered yet another year of good results.
Our Sales volume (Cement) witnessed a healthy increase of 8% from 3.12 million tons in FY
2022-2023 to 3.38 million tons in FY 2023-2024. However, corresponding net revenue from
operations grew only by 3.8% from Rs.1,524 Crores in FY 2022-2023 to Rs.1,583 Crores in FY
2023-2024, signifying heavy regional competition.
Softening of coal prices improved the margins in this segment; this coupled with
increase in volume resulted in better capacity utilisation, enabling better recovery of
overheads.
Indian Cement industry is expected to record moderate growth over the next few years.
Government spending on infrastructure projects, coupled with rising urbanization fuelling
housing demand, is expected to drive cement consumption across the regions. New capacity
additions in the region would counter this buoyant trend.
The top line performance of Heavy Engineering Business was lower by 30% as compared to
FY 2022-2023. Production was affected due to the Michaung floods in December 2023. Due to
under recovery of overheads, the losses mounted substantially. In spite of this financial
set back, this unit bagged very prestigious orders in the defense and space segment. We
delivered the prestigious order of Gaganyan Crew Module structure in October 2023, and
Metallic canopy for Missile Cannister was delivered for defense sector during the year. We
are currently working on another crew module for delivery in FY 2024-2025.
Hotel Mercure KCP Hyderabad, continued to consolidate its position as a preferred
business hotel with increased occupancy level at 84% for financial year 2023-2024.
Consequently, the turnover increased by 30%, with doubling of margins. We also won many
accolades for the roof top restaurant and other facilities & services of the Hotel.
The Subsidiary company KCP Vietnam Industries Limited, recorded the best business
results in history backed by second highest sugar cane quantity milled, highest ever sugar
quantity produced and sold, as well as highest average prices realised for sugar and
by-products.
With an enhanced crushing of 30%, sugar production increased by 50%, signifying better
recovery. Power pumped to grid increased by 40%. Turnover doubled, while the margins
increased by 85%. This is one of exceptional all round performance in the history of this
facility.
Our Joint Venture company Fives-Cail KCP Limited, recorded an exceptional year with
doubling of turnover and tripling of margins, due to better recovery of overheads. In
addition to sugar machinery, incinerator boiler is the flag ship product of this company.
We expect that with the continued emphasis on ethanol blended fuel, for environmental
requirements, demand for machinery will be stable for the next three years.
Reaffirming our commitment to sustainable practices, we continue to increase the share
of alternative fuels and green power in our operations with the existing investments in
Hydel Power (8.25 MW), Wind Power (3.75 MW), Waste Heat Recovery (2.50 MW) and Solar
Power(1.15 MW). The company has embarked on setting up a 16 MW Waste Heat Recovery (WHR)
Plant at its Cement Production facility at Muktyala, Andhra Pradesh.
We have further plans for de-bottlenecking and expansion in our core competence. Our
proposed investment in Railway siding project at Muktyala will offer compelling economic
advantages by reducing freight and forwarding costs, optimising lead distances and
warehouse operations.
Further, our efforts be greener in all our energy usage and to achieve such targets
ahead of the curve and mandates, is leading us to explore use of hydrogen in our
activities.
Our CSR initiatives and outreach activities within the communities we operate,
continued to reflect our endeavour to operate as a socially conscious and responsible
organisation which strives to build resilient and empowered communities in areas of
Education, skill development, Nutrition, Health, Livelihood and Women & Youth
empowerment.
The Board of Directors of the Company have recommended a dividend of 100% of paid-up
capital, equivalent to Re.1/- per share. This recommendation is subject to the approval of
Shareholders in the ensuing Annual General Meeting.
In conclusion, I wish to compliment the employees who are supporting us in bringing up
our organisation, to thank our customers and business partners and to express my gratitude
to our esteemed shareholders for their continued support and trust in our Company.
Dr. V.L. Indira Dutt
Chairperson & Managing Director.