From the Chairman and Managing Director (CMD)
Dear Shareholders
It is with great pleasure and enthusiasm that I present the Annual Report of Venus
Pipes & Tubes Limited for FY 2023-24. Reflecting on our remarkable journey, I am
reminded of how innovation, resilience, and a shared commitment to excellence have driven
us forward. Over the years, we have evolved from strength to strength, establishing
ourselves as a pioneer in the stainless steel pipes & tubes industry. Our indomitable
dedication to achieving quality, customer satisfaction, and sustainability has been the
cornerstone of our success.
Recently, we began receiving orders from the US markets. This marked the start of our
penetration into this market alongside the Middle East, while also strengthening our
footprint in Europe. Simultaneously, we are diversifying our presence across various
industries. During the year under review, we successfully entered sectors including oil
& gas, railways, paint and food processing.
Economic and Sectorial Overview
India's economy demonstrated a remarkable growth of 8.2% in FY 2023-24, marking a
notable increase from the 7% growth observed in the previous fiscal year. The boost was
driven by strong performances in the manufacturing and construction sectors. This
impressive GDP growth rate was the highest among the world's major economies. The
manufacturing sector, in particular, grew by a substantial 9.9% growth in FY 2023-24. With
these robust figures, India has solidified its position as the fastest-growing major
economy.
India continues to stand out in the global steel industry, with a strong 8.6% growth in
steel demand estimated for CY 2023 and a 7.7% growth projected for CY 2024.
These figures are distinct from the global growth forecasts of 1.8% and 1.9% for the
same periods. The expansion in India's construction sector was driven by government
spending on infrastructure and a resurgence in private investments, which benefitted the
capital goods sector. Furthermore, strong growth is expected in the automotive industry,
further boosting steel demand in the country. Supported by India's vigorous infrastructure
initiatives, per capita steel consumption increased to 87 kg in FY 2023-24 from 77 kg in
FY 2022-23.
(Source: https://www.deccanherald. com/business/economy/indias-gdp-
grow-at-78-in-q4fy24-3046647 https://jpcindiansteel.nic.in/ writereaddata/files/Trend%20
Report%20January%202024.pdf)
Operational Performance
In the dynamic landscape of global trade, our Company has experienced extraordinary
growth and expansion, underscored by our firm commitment to exploring new markets and
enhancing our capabilities.
OUR STRATEGIC FOCUS FOR THE FUTURE
Encompasses expanding into untapped geographies and identifying growth opportunities in
new markets like the US, Middle East, and Africa.
In FY 2023-24, our export contributions surged from Rs. 29.8 cr. to Rs. 98.7 cr.,
demonstrating our relentless pursuit of market expansion. Our strides in the European
market and further successful establishment in new territories such as the US and Middle
East solidified our position as a key international market player going forward.
This fiscal year marked a significant milestone, with a 3.2x increase in our production
capacity, coupled with a commendable boost in utilisation. This growth trajectory was
propelled by robust domestic demand and an increasing preference for top-tier products,
resulting in a bolstered market share.
On the export front, our revenue soared to approximately Rs. 100 cr., driven by
strategic backward integration, a relentless dedication to product quality, and
well-calculated market penetration efforts. Our investments in cutting-edge testing
technologies like ultrasonic testing and digital radiography have elevated the quality of
our offerings. Such strategies have led to increased acceptance across European markets
and facilitated seamless penetration.
In the US and Middle East markets, our active participation in various international
fairs and exhibitions has reaffirmed our commitment to expanding our export footprint.
Moreover, our diversified reach across multiple sectors including oil & gas, paper
industry, food processing, railways, and the paint industry has further solidified our
global presence.
Our expertise in manufacturing high- grade pipes and tubes has earned us approvals /
orders from leading players in the oil & gas sector both India & worldwide.
With the aim of emerging as a leading provider of comprehensive pipes and tube
solutions globally, we have unveiled a capex initiative totalling Rs. 175 cr. that spans
two distinct phases. The first phase focusses on establishing manufacturing capacity for
value- added fitting solutions and stainless & titanium-welded tubes by March 2025.
Phase two encompasses further capacity expansion, slated to be operational by December
2025.
As we expand our product line to include titanium-grade welded tubes, complementing our
existing stainless-steel variants, we reaffirm our commitment to innovation and meeting
evolving market demands. Furthermore, our Company under process to operationalise a 1 MW
solar power plant, which reflects our firm commitment to sustainability and
environmental consciousness. While we continue to shape the future of our industry, we are
dedicated to preserving the planet for generations to come.
Highlights of Financial Performance
We are delighted to announce yet another year of remarkable growth across all fronts,
underscoring our commitment to excellence and innovation. In FY 2023-24, our revenue
surged by over 45% year-on-year, reaching Rs. 802 cr. This exceptional performance was
underscored by our EBITDA margin, which stood at 18.2%, a significant improvement from
12.5% in FY 2022-23.
Our progress was further fuelled by strategic initiatives such as backward integration
of seamless pipes, internal operating efficiencies, and enhanced capacity utilisation.
Notably, our PAT witnessed a staggering 94.3% year-on-year growth, proving our relentless
pursuit of operational excellence. A key highlight of our success was the substantial
increase in revenue contribution from high- margin seamless pipes, accounting for 57% in
FY 2023-24 compared to 45% in FY 2022-23. This achievement can be credited to our
successful backward integration of mother hollow pipes, providing us with a distinct
competitive edge in the market. As we celebrate these achievements, we are determined to
drive sustainable growth and deliver long-term value to our stakeholders.
Our cash flow from operations has demonstrated remarkable strength, with an OCF of Rs.
52 cr. This not only signifies our financial stability but also empowers us to
drive future expansions using internal accruals, reducing our dependence on external
funding. Furthermore, the robust performance enhances our competitive advantage and
supports our strategic move into value-added products. As we continue to evolve, our aim
is to emerge as the preferred one-stop provider of comprehensive piping solutions for our
customers.
We remain committed to investing in growth opportunities and strategically positioning
ourselves for market leadership.
Way Forward
Our Company's strategic focus for the future encompasses expanding into untapped
geographies and identifying growth opportunities in new markets like the US, Middle East,
and Africa. Simultaneously, we are committed to strengthening our position in the European
market by increasing our penetration and market share. Our dedication remains firm in
building a strong and diversified foundation that drives sustained excellence. Alongside
expanding our export channels, we have diversified our presence across multiple
industries, successfully entering sectors such as oil & gas, railways, food
processing, and the paint industry. As we enter FY 2024-25, our outlook is optimistic,
with a focus on expanding our capacities and enhancing our export reach.
Looking ahead, with a long-term vision to become a leading global brand and cater to
ever-increasing customer needs, we are dedicated to continuous innovation and expansion.
We are actively exploring cutting- edge techniques and advanced methodologies to enhance
our manufacturing processes, ensuring our products remain at the forefront of industry
standards.
Our proactive approach to innovation and growth ensures that we not only meet but
exceed customer expectations, paving the way for sustained success and leadership in the
global market. By staying true to our core values of quality, reliability, and customer
satisfaction, we are poised to achieve our vision of becoming a top-tier global brand.
Closing note
Before I conclude, I would like to express my heartfelt gratitude to all our
stakeholders who have been instrumental in shaping and elevating our brand to its current
stature. As the industry undergoes expansion and modernisation, the demand for durable and
high-performance materials like stainless steel becomes increasingly crucial, further
reinforcing the necessity for our projects. Venus is poised for robust growth as we
actively pursue expansion across various sectors and enhance our offerings with
value-added products. As we enter FY 2024-25, we foresee a bright future marked by the
continuous expansion of our product range and client base.
Warm regards,
Arun Axaykumar Kothari
Managing Director