Dear Shareholders,
It is my privilege to present to you our Annual Report for FY 2023-24,
setting out our performance and progress over the year, as well as outlining our ambitions
for the future. Our integrated capabilities, diversified business model, and disciplined
execution have enabled us to consistently deliver positive outcomes for all stakeholders
over six decades.
Amidst the global headwinds, the Indian economy has been on an
impressive run, led by a robust cycle of investment in infrastructure creation and a surge
in manufacturing activities. FY 2023-24 saw India's economy expanding by 8.2%. The growth
trajectory is expected to continue, with ample headroom for further expansion. Increasing
capital expenditure, especially from the private sector, rising exports, and growing
income levels and consumption, along with favourable policy reforms, position the nation
as one of the fastest-growing major economies.
I am delighted to share that we have achieved remarkable growth this
year, with a 12% increase in revenue, reaching Rs. 5,014 crores compared to Rs. 4,481
crores in FY 2022-23. For the first time, we crossed the Rs. 5,000 crores revenue mark, a
significant milestone for our company. Nearly all product segments demonstrated robust
volume growth. Our electrical wires volume grew by 15%, and cables saw a 26% increase in
volume. While optic fibre cables (OFC) volumes dropped by 30% due to a lack of government
tenders and delays in telecom contracts, we managed to close some contracts in February
and March, boosting volumes towards the end of the year. Despite these challenges, we
remain optimistic about the potential of optic fibre cables as we continue to invest in
this area. Our new product segments surpassed Rs. 200 crores in revenue for the first
time, ending the year at Rs. 225 crores. We aim to achieve a revenue of Rs. 500 crores
over the next 2-3 years.
Our Profit Before Tax (PBT) reached Rs. 753 crores, reflecting a 17%
growth over Rs. 646 crores in the previous year. We concluded the year with a strong cash
flow and tight management of working capital. Our cash flow from operations stood at Rs.
577 crores, significantly higher than Rs. 356 crores in the previous fiscal. The Board of
Directors has recommended a 400% dividend, resulting in an outgo of Rs. 8 per share (face
value of Rs. 2 per share), amounting to Rs. 122.4 crores. Our distribution network has
expanded considerably to cover the needs of approx. 2,15,000 retailers.
We remain undeterred in our commitment to strengthening our
capabilities and capacities to deliver long-term, sustainable growth. In FY 2023-24, we
envisaged a capital expenditure outlay of Rs. 500 crores to expand our product offerings.
We plan to scale up our manufacturing facilities, launch new products, enhance brand
engagement and broaden our distribution reach while improving operational efficiencies.
We are setting up our electron beam facility by installing two machines
with capacities of 1.0 MeV and 1.5 MeV. This will enable us to manufacture a range of
wires and cables using radiation technology, offering products with temperature ratings up
to 150?C and improved environmental and abrasion resistance. This includes solar cables,
high-end electrical wires for housing and instrumentation cables for railway applications,
especially in regions launching high-speed trains. The electric vehicle sector also drives
demand for EV battery cables. We are also advancing our optic fibre and cabling expansion
in three phases. The Preform facility structure is nearly complete, with production
anticipated by the end of 2024. With this, our fibre capacity will double from 4 million
to 8 million kilometres and the cabling capacity will increase from 8 million to 10
million kilometres, with full readiness expected later in the year, aligned with the
increasing demand for optical fibre cables. Additionally, we are expanding our auto-cable
capacity at our Uttaranchal site, with new equipment expected in FY 2024-25.
Our technology solutions have been pivotal in improving workflow
efficiency, facilitating accurate inventory management and timely delivery, reinforcing
our dedication to operational excellence and customer satisfaction. We have adopted a QR
code-based system to enhance product authenticity and streamline material movement. This
system ensures that consumers receive genuine products and optimises the supply chain,
reducing the risk of counterfeit goods and driving efficiency.
We have consistently invested in bolstering our dealer and distribution
network, boosting product availability. A notable initiative has been the establishment of
our new, state-of-the-art mother warehouse in Nelamangala, Bengaluru, boasting 40,000 sq.
ft. of indoor space and an additional 20,000 sq. ft. of open storage outdoors. Designed to
ensure seamless logistics and product distribution, this facility aims to enhance our
operational efficiency and customer service. Additionally, we are expanding our retail
presence and establishing separate networks for each product segment to further strengthen
our distribution reach.
In the FMEG segment, we continue to focus on the development of
innovative, high-quality products to enhance the lives of our consumers. Powered by
advanced processes and technology, our offerings meet evolving preferences and augment our
brand visibility while promoting sustainability and efficiency. Our sustained investments
in branding and marketing have yielded results in the form of enhanced brand resonance and
customer connect.
The outlook for the wires and cables industry remains optimistic.
Factors such as increased focus on infrastructure development, booming construction
activities, industrial expansion, rural electrification initiatives, renewable energy
generation, and upgrades to transmission and distribution infrastructure, are expected to
propel the demand for cables and wires. The Union Budget 2024-25 underscores the
government's commitment to infrastructure development, with a significant allocation of
Rs. 11.11 lakh crores for FY 2024-25. Further, initiatives like the Bharat Net project and
the accelerated rollout of 5G, aimed at improving broadband connectivity, will drive
growth in communication cables. Evolving consumer aspirations, rising income levels,
growing urbanisation and initiatives in the electrification and housing sectors will
accentuate demand for fast-moving consumer appliances.
I would like to express my gratitude to our Board members, customers,
bankers, channel partners, suppliers, employees, business associates and all other
stakeholders for their unwavering trust and support. With our robust business model and
strategic investments, we are well-positioned to seize these opportunities, fostering
growth and value creation for all.
Warm Regards,
Ratnakar Barve
Chairman