HYDRO S&S INDUSTRIES LIMITED
ANNUAL REPORT 2008-2009
CHAIRMAN'S REPORT
Ladies and Gentlemen:
It gives me immense pleasure to welcome all of you to the Annual General
Meeting of your Company. The Annual Report for the period ended 31st March
2009 has already been circulated and with your permission, I will take it
as read.
National Scene:
Last year when we met, I was a bit pessimistic on the outlook for the
Country and the Economy. Thereafter, there has been good news and bad news.
The good news is that the general election results gave a clear mandate for
the UPA and the fear that we would have a fractured verdict with the
consequent instability was fortunately belied. The further good news was
that India was able to successfully complete its negotiations on the
Nuclear Deal. Of course, some doubts are now being expressed on the
understanding of the two parties on some of the provisions.
The bad news is that the Global Economic crisis has also affected India
severely. Many sectors are suffering for want of orders, jobs have been
lost, exports are significantly down, GDP growth and Industrial growth have
been retarded. The fiscal deficit has ballooned and prudent limits on
fiscal and budgetary management have been set aside. The stock markets are
struggling to claw their way back and there is extreme volatility in the
markets as well as with the foreign exchange rates.
To add to our woes, the monsoon has failed and the spectre of a severe
drought is now haunting the country. The Government is now thinking to
import foodgrains after several decades of self sufficiency.
All in all, the Central Government is not able to take advantage of the
clear electoral verdict and is again in a fire fighting mode. Law and order
matters as well as terrorist threats continue to pose severe challenges
across the country.
One is not clear whether the worst is over for the global economic crisis.
There are so called green shoots of recovery being seen in several
countries. One hopes that these will take strong root and the economies of
the nations will revive soon. We live today in an interconnected world and
our prosperity and growth is contingent on the global recovery also. Much
is expected from India and China to spur global economic recovery. We hope
that the Goods who have watched over India for centuries will extend their
benevolence again to the Nation.
I wish to particularly highlight the severe impact of the recession on the
Auto Sector which has had a consequential impact on your company's
performance during the year under review. As on date, there has been a
turnaround in the performance of this sector and the sales data during the
last few months shows a positive trend. One hopes that this is not
temporary but will be sustained. One should keep in mind that while even
though the domestic market is showing signs of improvement, the continued
growth of the export market is too early to be predicted.
Your Company:
The Annual Report of the Company containing the Directors' Report and the
Management Discussion and Analysis Report explain in detail the company's
operations and the business environment.
The buyback of Equity shares scheme which was announced last year in
September is scheduled to close as at the close of business hours tomorrow
- 15th September 2009 and many shareholders have exercised their option to
exit from their holding. The response to the scheme has been quite
positive.
Your company has initiated a number of steps to deal with the recessionary
conditions and the impact of inflationary input costs. Detailed attention
is being given to the reduction in inventories, aggressive collection of
receivables from the major Tier-1 customers as well as pursuing new
opportunities with both existing customers as well as new entrants. We do
believe that these steps will infuse liquidity into the company's cash flow
management as well as enhance the production and sales volumes to feed the
three Plants.
In conclusion, I wish to assure the shareholders that the company faces the
future with confidence and hope. I also wish to acknowledge with gratitude
the contribution of each and every employee, the stakeholders including the
customers, vendors, bankers and most importantly, you the shareholders in
ensuring the continued success of your company.
Let us now proceed to take up the business of today's meeting.
Chairman of the Meeting.
Source: Annual General Meeting - 14th September 2009.