Dear Shareholders,
As we stand on the threshold of a new chapter in our nation's history, it is with a
sense of huge responsibility and honour that I reflect upon the profound significance of
the Amrit Kaal, a new dawn of opportunities that will bring with it the chance to
fulfil our nation's aspirations. Together, we envision a prosperous and inclusive India,
in which the fruits of development will reach all regions and citizens. We dream of a
developed nation that will prosper through equitable growth and bring better living
conditions for all, world-class infrastructure, and technological advancements.
Just as our forefathers fought valiantly for our nation's freedom, today, we too are on
a noble quest, fighting against the shackles of dependency.
PTC's journey over the last sixty years is a testament to the potential within each one
of us to contribute to this greater cause. Our company has never been just a place of
work; it is a crucible of dreams and aspirations that are inextricably interwoven into the
fabric of our nation's progress.
While we strive to break free from the clutches of dependence on external factors and
empower ourselves to shape our destiny, we also ensure that every product we manufacture
is a testament to this dedication to create, innovate, and bring value not just to India,
but also to the world. But our journey doesn't stop at self-reliance alone. We also bear
the responsibility of striving for Parity – the idea that every citizen, regardless
of their background, deserves an equal opportunity to succeed.
As we set out towards this worthy goal, we must also ask ourselves, what will give us
the best chance of continuous success for many generations of technology and people?
Cultivating Excellence: Our Guiding Values
The answer lies in the cultivation of a resilient foundation that can withstand the
test of time and the rapid evolution of technology. The winds of change will inevitably
blow, and new challenges will emerge on the horizon. Thus, it is imperative to recognize
that our success is not solely contingent on the strategies we deploy or the markets we
navigate. It rests firmly on the bedrock of our values and the tapestry of our company
culture. Just as our forefathers' unwavering resolve paved the way for our nation's
freedom, our corporate values serve as the guiding compass that steers us through these
uncharted territories.
As author Jim Collins says, "Great organizations understand the di_erence between
their core values and purpose (which almost never change), and operating strategies and
cultural practices (which endlessly adapt to a changing world)".
We find ourselves today at the brink of a transformative phase that is poised to extend
across the next several years. This period holds the promise of ushering in the fruition
of numerous new projects and strategic investments. Alongside this growth, our team is set
to expand, welcoming fresh talents into the folds of the PTC family. In light of these
developments, it becomes even more pertinent to uphold the principles that have propelled
us thus far and reflect on the values that have shaped our journey.
These values are not mere words etched into our mission statement; they are the core of
our identity, the guiding light that has steered us through challenges and triumphs alike.
Reinforcing, re-emphasizing, and re-inculcating these values into the heart of our
operations is paramount. By doing so, we ensure that our journey forward is aligned with
the same spirit that has led us to our current juncture.
Our values define who we are, how we operate, and where we're headed. Our values are
defined by the word ASPIRE, which stands for:
Agility - responding and adapting to changes quickly; learning new skills and
responding to new requirements; executing work faster.
Sustainability - taking responsibility for longevity; creating lasting value
for our stakeholders; safeguarding the environment;
and Selflessness - seeking what is best for PTC; having no ego when searching for
the best ideas; helping colleagues; sharing information openly and proactively.
Passion - inspiring others with own thirst for excellence; caring intensely about
PTC's success; being tenacious;
with Prudence - making wise decisions; getting beyond treating symptoms and
identifying root causes; thinking strategically.
Integrity – being known for honesty, candour, and directness; being
straightforward, being quick to admit mistakes;
Impact - accomplishing important work; demonstrating consistently strong and
reliable performance; focusing on results;
and Innovation - re_conceptualising issues to discover practical solutions to
di_cult problems; challenging prevailing assumptions and suggesting better approaches;
creating new ideas; staying nimble; minimizing complexity and simplifying.
Respect - treating people with respect independent of their status or disagreement;
listening well to understand better; remaining calm in stressful situations; understanding
and being considerate of the needs of others.
Endurance - rejecting the temptation to give up when things get tough; staying
focused on executing work.
Evolving Opportunities: The Geopolitical Impact
We are living in a new world, where all established domestic and international dynamics
are being re-evaluated and getting realigned. This presents us with both challenges and
extraordinary opportunities. PTC is uniquely positioned against this backdrop to leverage
this unfolding opportunity for unprecedented growth and transformation.
The global business arena is witnessing a remarkable transformation marked by a series
of defining events over the last few years.
Global Supply Chain Reconfiguration
Firstly, the acute disruption in global supply chains, exacerbated by the aftermath of
the COVID-19 pandemic, has triggered a significant re-evaluation of existing operational
dependencies. This disruption has propelled the world to explore alternative sourcing
avenues, a shift that has the potential to redefine India's manufacturing landscape. This
juncture presents a substantial window of opportunity that PTC is well-positioned to
capitalize on.
Russia-Ukraine Conflict
Secondly, the ongoing conflict between Russia and Ukraine carries implications that
ripple beyond the geopolitical arena. Historically, Russia has played a prominent role in
the global defence equipment export landscape, with India as a key customer.
It is important to understand that even though over the last two to four years, there
has not been any major equipment that has been bought from Russia, there is still a huge
quantum of import that is happening in the form of spares, components and materials.
Approximately one-third of Russia's total exports are tied to aero engines, with
aircraft and aircraft spares constituting another significant portion.
This underscores the vital role of aerospace-related exports in Russia's trade,
particularly in terms of engines, platforms, systems, and components.
Furthermore, the Russia-Ukraine conflict has revealed a crucial implication –
Russia's substantial contribution to the global supply of titanium wrought materials and
components. Over 50% of Russia's titanium production is exported to the West. This
dependency is particularly evident in aerospace, defence, and civil industries, where
titanium is a critical material.
Recent news articles highlight the global aerospace industry's reliance on Russian
titanium. A Wall Street Journal piece emphasizes the need for the West to reduce
dependency on it. Airbus is pursuing plans to disengage from Russian titanium sourcing,
while Boeing has halted its titanium imports as a response to the geopolitical situation.
Boeing's annual report acknowledges the significance of titanium for their production and
Airbus, too, acknowledges its reliance on Russian titanium, both directly and indirectly
through suppliers.
Geographical risks tied to titanium sourcing are being re-evaluated due to Russia's
invasion of Ukraine. These intricate dynamics emphasise the pivotal role titanium plays in
global aerospace industries and the critical need for reliable sources amidst geopolitical
shifts, and securing a consistent supply of titanium is imperative for the entire
aerospace ecosystem.
Given the investments in technology and state-of-the-art infrastructure that PTC has
been making in manufacturing components and wrought products in Titanium Alloys for the
last few years, PTC is the only company in India with the capability to fill this void.
Aatmanirbhar Bharat (Self-Reliant India)
Lastly, it is impossible to overlook the government's steadfast drive towards
self-reliance, encapsulated in the term "Atmanirbharta," particularly in the
realm of aerospace and defence.
The government's strong commitment to bolster self-su_ciency, especially in defence, is
evident. This aligns with the larger context of increasing defence spending both
domestically and globally. In the last Union budget, India's defence expenditure was
approximately $74 billion. Projections indicate an anticipated growth to $183 billion by
2030 – a compound annual growth rate (CAGR) of around 12% over seven to eight years.
It is also important to note that the capital expenditure portion of the defence budget
was about 30% in the last budget cycle, equivalent to around $22 billion. Extrapolating
this allocation to the capital budget, projected figures suggest approximately $55 billion
by 2030.
This highlights a dynamic landscape of expanding defence budgets and growing
investments – both nationally and internationally. As we navigate these shifts, we
find ourselves poised to capitalize on the momentum created by the alignment of these
themes. Our strategic positioning aligns perfectly with these evolving trends, setting the
stage for significant growth and impact. By contributing to this transformative agenda, we
not only bolster our domestic industry but also reinforce our resilience and influence in
the global landscape.
Considering the implications outlined earlier, it becomes evident that substantial
growth opportunities lie ahead, contingent upon possessing the necessary technology. The
inability of India to fully engage in the global defence ecosystem can be attributed to
technology gaps in crucial domains. This is precisely where our role emerges.
Over our 60-year history, our core focus has centred on metal and metal components.
This sector serves as our domain of expertise and proficiency. Recognizing this, we
embraced a fundamental ethos about seven to eight years ago – a guiding principle we
consider our company's core. This principle is driven by the concept of achieving
‘Parity'.
In essence, Parity signifies aligning our capabilities, technology, skills,
workmanship, talent, knowledge, quality, productivity, e_ciency, and sustainability with
global benchmarks. We aspire to stand shoulder-to-shoulder with the best worldwide in the
realm of metal and metal components. This foundational principle isn't just a tagline;
it's the compass that shapes our strategic decisions, dictating not only which ventures we
pursue but also those we choose to abstain from.
By adhering to the principle of Parity, we have positioned ourselves as a pivotal
player in bridging technology gaps, thereby contributing significantly to India's
participation in the global defence landscape. Our expertise and unwavering commitment to
excellence mark our distinct value proposition in a world that increasingly demands
cutting-edge technological solutions.
Thus, our Dharma to achieve Parity is becoming our catalyst, propelling us towards a
quantum leap. We are not merely at the right place; we are poised at the precise
intersection where intention meets opportunity.
Engineering Excellence: Powering the Engine
This brings us to our theme for this year, where ‘Powering the Engine'
becomes a trigger for growth, innovation, and progress for PTC in the aerospace and
defence sector. Just as an engine requires potent fuel, adequate thrust, and precision
machinery to operate e_ciently, PTC is harnessing its enduring values, emerging
opportunities and advanced manufacturing capabilities to steer India's trajectory towards
self-reliance, global competitiveness, and technological excellence. This theme highlights
PTC's commitment to align with global shifts, seize strategic opportunities, and create
synergies that amplify India's aerospace and defence capabilities.
Amid this complex interplay of forces, PTC's strategic role finds expression through
three vital technology Groups. The first, the
Industrial & Defence Group, which includes our Air-Melt Castings vertical and
Machining and Integration vertical, caters to the specific needs of critical and
supercritical applications in Oil & Gas, Marine, Energy, Pulp & Paper, and
Defence.
The second is the Aerospace Castings Group, which includes our Titanium Castings
vertical, Super Alloy Castings vertical and Controlled Microstructure Castings vertical.
The latter represents the manufacturing of Single Crystal,
Directionally Solidified, and Equiaxed blades and vanes – a capability that a
select few companies and countries have in the world.
A 15,000 square metre plant with enhanced capacity and capability for the manufacture
of aerospace and defence components under these verticals is being set up at the 50-acre
land in the Lucknow node of the Uttar Pradesh Defence Industrial Corridor with
comprehensive state-of-the-art equipment and technological capabilities.
The third is the Aerospace Materials Group, which includes our Titanium Alloy
Mill vertical and Super Alloy Mill vertical. These Mills are being set up in a 20,000
square metre plant at the same 50-acre site in Lucknow. An Electron Beam Cold Hearth
Remelting furnace, a Vacuum Arc Remelter, a Plasma Arc Cold Hearth Melting Furnace and a
Vacuum Induction Melting Furnace shall be installed here, enhancing our manufacturing
capacity, and improving indigenous capabilities to manufacture critical and strategic
materials. Additionally, an Open Die-Forging facility is also being integrated into this
plant.
These Groups will play a pivotal role in the manufacture of high-quality components,
materials and, sub-systems for aerospace, defence, medical and industrial applications
indigenously.
Each milestone achieved by PTC Industries brings us closer to our goal of achieving
parity and building a robust defence and aerospace ecosystem in India. Through strategic
partnerships, advanced technology acquisitions, and participation in prestigious events,
we are taking significant strides towards becoming a global leader in manufacturing
advanced engineered metal components, materials and sub-systems. Moving forward, we remain
dedicated to driving innovation, fostering self-reliance, and contributing to the growth
and development of India's defence and aerospace sectors.
Financial Overview
During the fiscal year, we recorded an increase in total revenue, at H 227 crores,
compared to H 185 crores in the previous year. Our EBITDA also rose from H 66 crores to H
48 crores, accompanied by an improved EBITDA margin of 29.2%, an increase of 310 bps in
comparison to FY2021-22. These achievements can be attributed to growth in products and
customers along with our cost optimisation initiatives, which have been carefully
implemented to maximise operational e_ciency and deliver value to our shareholders.
Moreover, our profit after tax reached H 25.8 crores, marking a substantial improvement
from H 12.80 crores in the previous year.
Noteworthy Developments
We are proud to have been honoured with the ‘Raksha Mantri Excellence Award'
in 2022, for excellence in indigenisation in the Defence and Aerospace Sector – an
award we received from the honourable Defence Minister and a testament to our relentless
e_orts to promote the highest standards of manufacturing and contribute to the
government's vision of creating ‘Aatmanirbhar Bharat'.
We are also thrilled to have participated in the prestigious ‘Paris Air Show
2023', which serves as an exceptional platform for showcasing our capabilities and our
technological know-how. It provides us with the opportunity to engage with key
stakeholders, establish new partnerships, and strengthen our position in the global
defence and aerospace market.
I am also happy to extend a warm welcome to Ms Prashuka Jain, who joined our esteemed
Board of Directors this year, bringing with her a wealth of expertise and insights that
will undoubtedly enrich our strategic deliberations and contribute to our shared vision of
driving PTC's success to new horizons.
This pursuit of self-reliance and parity isn't without challenges. However, history has
shown us that challenges are merely stepping stones towards greatness. We always have the
power to transform obstacles into opportunities and setbacks into comebacks. As we
navigate these waters, let's remember that the collective strength of our team is greater
than any individual e_ort.
Way forward
As we look ahead, we remain committed to fostering a culture of innovation, operational
excellence, and strategic collaborations. With an unwavering focus on maximising
stakeholder value, we remain committed to operating with responsibility. We realise the
importance of upholding the highest standards of ethical practices to strengthen the
foundation of a sustainable organisation.
I remain extremely grateful to our esteemed shareholders, whose unwavering support and
confidence in our vision have been integral to our success. Your continued trust in PTC
Industries has been a source of motivation for us to continually strive for excellence.
I would also like to acknowledge the support and cooperation of our customers,
directors, associates, bankers, financial institutions, regulatory authorities, business
partners, and communities where we operate. Their relentless trust and optimism have
guided us to create a positive ecosystem that fosters growth and sustainability.
In closing, I extend my heartfelt gratitude to each and every employee in the PTC
family for being a part of our cherished legacy. Together, we will continue to soar to new
heights, achieve milestones and set new benchmarks in the years to come.
As we continue to innovate, collaborate, and inspire one another, we will also nurture
an environment where ideas flourish, skills are honed, and aspirations are achieved. We
rea_rm our commitment to self-reliance and parity, knowing that every step we take today
shapes the destiny of our company, our community, and our country.
As the Bhagavad Gita wisely reminds us, "Wherever there is the divine skill of
disciplined action and the resolute mind, there, undoubtedly, you will find prosperity,
enduring accomplishments, righteous conduct, and an unwavering sense of purpose." PTC
Industries' unwavering commitment to its Dharma is a reflection of this profound wisdom,
serving as an inspiration for all those who endeavour to align their actions with their
true purpose.
Jai Hind!
Regards,
Sachin Agarwal
Chairman & Managing Director