K. Ajith Kumar Rai
Founder and Chairman
"MARCHING AHEAD WITH CONFIDENCE"
I am pleased to share with you the performance of Suprajit for the year 2023-24. The
enclosed reports and financial statements provide you with detailed and relevant
information.
Global uncertainty continued with geopolitical conflicts, inflationary trends, and
higher interest rates during the last year. Disruptions in the supply chain due to issues
related to the Suez and Panama Canals added to the problems. Overall, the global
automotive growth remained muted. Team Suprajit managed these challenges well to clock a
satisfactory performance.
Suprajit Controls Division (SCD) had a flat year due to the above-mentioned
challenges. The division also faced significant issues relating to wage increases,
particularly in Mexico, special import duties on certain Chinese imports, cross-currency
impacts, and a significant downtrend in the non-automotive segment. Operationally, SCD
plants performed well and have won significant new contracts in the automotive segment. It
is expected that in the medium term, with increased business and further restructuring,
SCD will perform better. During the year, the China plant was relocated.
The Domestic Cable Division (DCD) performed well, although the aftermarket business
was muted. The division is additionally focusing on "beyond cable" projects,
including CBS, latch assembly, actuators, etc., which would add to the growth of this
division in the coming years. An industrial property was purchased during the year, with
land measuring 1,75,000 sq. ft. located at Jigani Industrial Area.
Phoenix Lamps Division (PLD) had a turnaround year. PLD's focus on the aftermarket,
both domestic and overseas, as a ‘Last Man Standing' strategy yielded positive
results with growth in revenues as well as a significant improvement in margins. With the
completion of restructuring at Trifa/Luxlite, PLD is on a clear path to grow the business
profitably.
Suprajit Electronics Division (SED), the new division of your Company, performed
commendably during the first full year of operation. Sales of the division grew strongly
through the year, with margins clocking double digits during the last quarter. Deliveries
of actuators, digital clusters, and throttle position controls to marquee EV/ICE 2/3
wheelers continue to be robust, with a strong pipeline of new orders.
Suprajit Technology Centre (STC) - Automotive electronics, actuators, and braking
products form the core product development areas of STC. New contracts have been won for
these products for your Company due to excellent efforts by STC on multiple projects. STC
continues to work closely with customers on new projects. Plans are being finalized to set
up a larger premise to house the growing STC teams.
Current Year:
While the global uncertainties continue, the business through SCD is expected to grow
with new contract wins in the automotive sector. The non-automotive part of the business
is expected to have a challenging year. Global customers' plans to derisk specific
geographies/countries are bringing in additional contracts for your Company. In line with
the strategy to offer customers onshore, close-shore, and low-cost operations, your
Company announced the acquisition of Stahlschmidt Group of Companies (SCS) out of
insolvency proceedings in Germany. This acquisition will make your Company one of the top
two cable makers in the world and a preferred cable solutions provider to every global
major in the automotive/non-automotive world.
DCD will continue to pursue beyond cables projects with a strong focus on strengthening
its core cable business in both OEM and aftermarket segments, to ensure robust business
growth and profitability. PLD will continue to strengthen its presence in the domestic OE
and aftermarket. It will also strengthen its focus on the global aftermarket business
through Luxlite. PLD is expected to perform well. SED is expected to grow profitably
during its second full year of operation, with new customers and product launches during
the year.
The capital expenditure is estimated at Rs. 1800 million, covering the entire group.
The next few years, while challenging, will be exciting for all of us at Suprajit. With
solid new business wins within various divisions of the group, your Company is emerging as
a well-diversified global auto component supplier with a clear customer focus. Team
Suprajit is working tirelessly to meet customer expectations and global challenges. As we
consolidate our core cable business, we are emerging as a strong ‘beyond cables'
company, further derisking the business and growing it profitably.
I am confident that Team Suprajit will continue to deliver value to all our
stakeholders, including our valued shareholders.
To this end, I seek your continued support and good wishes.
With warm personal regards,
Yours sincerely,
| K. Ajith Kumar Rai, |
| Chairman. |