Our consolidated revenue for the fiscal 22-23 stands at J
10,137.49 crore as against J 9,622.34 crore in 2021-22. We have recorded an EBITDA
of J 1,556.49 crore with an EBITDA margin of approximately 15.07%.
Dear Shareholders,
I hope this message finds you in good health and high spirits. I am
writing to provide you the performance of Vardhman Textiles Limited in the fiscal year
2022-23.
We need to take a moment to reflect on the remarkable journey of
Vardhman Textiles and share our collective achievements. As one of the largest
manufacturers of yarn in India with an impressive spindle count of 1.23 million and a
fabric processing capacity of 180 million meters, we have truly established ourselves as a
world-class organization.
Our success is a testament to the synergy of vision, passion and
technology. Across our 15 state-of-the-art manufacturing units spread across four states,
we manufacture an extensive range of products including different varieties of Yarns,
Fabrics, Garments and Acrylic Fibre. Such diverse operations are made possible by the
dedication and hard work of our over 28,000 employees, with women workers comprising 35
percent of our workforce.
Macro-economic Overview
Over the past year, the world economy has faced numerous disruptions,
with the ongoing Russia-Ukraine conflict playing a significant role in disrupting supply
chains. The resulting surge in the prices of critical commodities, including crude oil,
natural gas, fertilizers and wheat, has intensified inflationary pressures. Central banks,
initially slow to react, have now recognized the need for a strong monetary policy
response. Despite these challenges, I am pleased to share that the Indian economy has
shown remarkable resilience in the face of the pandemic. In fact, so far as the pace of
recovery is concerned, we remained ahead of many other nations, positioning ourselves to
return to the pre-pandemic growth path in FY23. However, we have also faced the challenge
of reining in inflation, particularly due to the US and European strife. Through concerted
efforts by the Government and the Reserve Bank of India (RBI), we have been successful in
containing the inflation as compared to many other countries.
While various developed economies are passing through tough times with
strong possibility of further policy rate increases by the US Federal Reserve and European
Central Banks, we remain optimistic about India's economic growth comparatively.
Despite the shrinking global market size in the second half of this year, agencies
worldwide project India as the fastest-growing major economy. This optimism is underpinned
by the resilience of our economy, characterized by the rebound of private consumption as
the primary driver of growth. This shift in focus has also stimulated production activity
and increased capacity utilization across sectors, leading to a decline in urban
unemployment rates.
Global and Indian Textiles Industry
Now, turning our attention to the global and Indian textile industries,
we have witnessed a volatile period in the market. Fluctuating cotton prices on the
international front, reaching as high as US Cents 140 to 150 per pound, have had a direct
impact on Indian cotton prices. Further, imposition of 10% customs duty on import of
cotton fiber by India has resulted into higher cotton
fiber cost in India than the international prices making downward
industry less competitive. The demand for yarn is also not showing encouraging signs
because of recession like conditions in US & Europe and the same is also reflected in
stagnating cotton yarn prices while cotton fiber prices remain firm. To illustrate, cotton
yarn exports from India have fallen from about 1300 mn kg in 2021 to less than 700 mn kg
in 2022 due to low demand of yarn in leading garment exporting countries like Bangladesh
and China thereby creating stress on capacity utilization for Indian textiles mills and
subdued prices for textile products in domestic market. Despite these challenges, the
opening up of the Chinese market after stringent Covid-19 restrictions has brought a sense
of some relief. Gradual market reopening may lead to increased demand for yarn from the
Chinese market, which had been lacking earlier.
Financial Performance
Our consolidated revenue for the fiscal 22-23 stands at H 10,137.49
crore as against H 9,622.34 crore in 2021-22. We have recorded an EBITDA of H 1,556.49
crore with an EBITDA margin of approximately 15.07%. Our robust manufacturing
capabilities, combined with our ability to cater to diverse customer needs, have
positioned us as a preferred partner in the textile industry. Furthermore, our efficient
cost management practices and optimized supply chain have contributed to the profit
margins.
Innovation and Developments
We remain committed to enhancing our performance through incremental
improvements and trailblazing innovations. By focusing on developing new products and
adopting a customer-centric approach, we have built enduring relationships with all our
stakeholders. Our non-negotiable value system and ethical business practices have been the
bedrock of our incredible success story. Our commitment to excellence extends to the
adoption of Six Sigma, which has yielded positive outcomes and improved responses. As the
country's largest vertically integrated textile manufacturer, we take pride in
offering our clients unmatched agility, flexibility, consistency, reliability,
traceability and sustainability through every stage of production.
Our workforce
At Vardhman Textiles, we believe in being proactive rather than
reactive. This philosophy has kept us ahead of the curve, enabling us to anticipate and
assess any situation. We foster a culture of skill development and talent encouragement
which is reflected in the loyalty and dedication of our employees. Inclusive growth is at
the heart of our leadership approach. We strive to create an environment that promotes the
development of people through trust, transparency and empowerment. This includes creating
ample opportunities for women, who are central to our vision. We actively encourage their
growth and development through training programs, mentorship opportunities and career
advancement pathways. By fostering an inclusive workplace, we empower women to unleash
their full potential, contributing not only to the success of our company but also to the
economic and social progress of our nation.
Responsible Corporate Citizen
Corporate Social Responsibility (CSR) is deeply ingrained in our
aspirations. We are committed to empowering the communities that host us through
initiatives focused on education, sustainable livelihood, healthcare and sanitation.
Leading with compassion, we envision a better world of opportunities where people can lead
lives with dignity. Sustainability is a core driver of our operations. Recognizing the
global shift towards greener and more sustainable products, we have actively pursued
sustainable technologies, processes and products over the past few years. In addition, our
prudent financial management practices and adherence to corporate governance principles
have garnered trust and confidence from our stakeholders, including investors,
shareholders and financial institutions. We remain committed to transparent and ethical
business dealings, ensuring the long-term sustainability and growth of our organization.
Way forward
Looking ahead, we are optimistic about the future prospects of Vardhman
Textiles. We will continue to leverage our strengths, drive innovation and explore new
avenues for growth. Our unwavering commitment to excellence, customer satisfaction and
social responsibility will remain at the forefront of our strategic priorities.
Thank you for your continued trust and support.
Sincerely,
Shri Paul Oswal
Chairman