Atul Ltd 2018-19

Letter to the shareholders Dear Shareholders, Although we live in times of promising partnerships, ƥĚČĺŠūŕūijĿČîŕ ċƑĚîŒƥĺƑūƭijĺƙ îŠē ČūŠƥĚŞƎūƑîƑǋ ŕĿǄĿŠijȡ ƥĺĚǋ îƑĚ îŕƙū ƎƭŠČƥƭîƥĚē ċǋ ƥƑîēĚ ēĿƙƎƭƥĚƙȡ ČŕĿŞîƥĚ ČĺîŠijĚ îŠē ĿŠĚƐƭîŕĿƥĿĚƙȦ ¹ū ĚƙƎūƭƙĚ ƥĺĚ ƥĺƑĚĚ ƎĿŕŕîƑƙ ūlj ƙƭƙƥîĿŠîċĿŕĿƥǋ ȶ economic, environmental and social – in pertinent ways, we have with us the exemplary legacy of our visionary Founder, qƑ eîƙƥƭƑċĺîĿ gîŕċĺîĿȫ Ŀƥ ĿŠƙƎĿƑĚƙ ƭƙ ƥū ČūŠēƭČƥ ċƭƙĿŠĚƙƙ ĿŞċĿċĿŠij îŠē ljūƙƥĚƑĿŠij eternal Values and qualities – integrity, perseverance, larger purpose, humility and attention to details – which gives us inner strength, direction îŠē ċîŕîŠČĚ ƥū ƎĚƑljūƑŞ ĿŠ î ČūŠƙƥîŠƥŕǋ ĚǄūŕǄĿŠij ǅūƑŕēȦ A year ago, economic activity was accelerating; 12 months ŕîƥĚƑȡ ŞƭČĺ ĺîƙ ČĺîŠijĚēȦ ØūƑŕē ĚČūŠūŞǋ at US$ 84 tn grew îƥ ǩȦǬɼ ĿŠ ǨǦǧǮȡ ƙŕūǅĚƑ ƥĺîŠ ǩȦǭɼ ĿŠ ǨǦǧǭȦ TŠēĿîŠ ĚČūŠūŞǋ îƥ À¬ɐ ǨȦǭ ƥŠ ijƑĚǅ îƥ ǭȦǧɼ ĿŠ ǨǦǧǮȡ ĺĿijĺĚƑ ƥĺîŠ ǬȦǭɼ ĿŠ ǨǦǧǭ ȶ Ŀƥ ƑîŠŒĚē ŠƭŞċĚƑ ƙĚǄĚŠ îljƥĚƑ ƥĺĚ À¬ ȡ ĺĿŠîȡ cîƎîŠȡ HĚƑŞîŠǋȡ ƥĺĚ Àe îŠē GƑîŠČĚȦ ¹ĺĚ ǅūƑŕē ĚČūŠūŞǋ Ŀƙ ƎƑūŏĚČƥĚē ƥū ijƑūǅ ƙŕūǅĚƑ îƥ ǩȦǩɼ ĿŠ ǨǦǧǯ ǅĿƥĺ ĿŞƎƑūǄĚē ƎƑūƙƎĚČƥƙ ljūƑ ƥĺĚ ƙĚČūŠē ĺîŕljȦ TŠēĿîŠ ĚČūŠūŞǋȡ ǅĿƥĺ ƙƥƑƭČƥƭƑîŕ ƑĚljūƑŞƙȡ Ŀƙ ĚǊƎĚČƥĚē ƥū ijƑūǅ îƥ ǭȦǨɼ ĿŠ ǨǦǧǯȹǨǦȦ ČƑūƙƙ ĚČūŠūŞĿĚƙȡ ƥĺĚ ĿŞƎĚƑîƥĿǄĚƙ îƑĚ ƥū ĚŠĺîŠČĚ ĚljǛČĿĚŠČĿĚƙȡ ĿŠČūƑƎūƑîƥĚ innovations and reinforce inclusiveness – they remain valid îŕƙū ljūƑ TŠēĿî îŠē ĿŠ Ŀƥƙ ūǅŠ ǅîǋ ljūƑ ūƭƑ ūŞƎîŠǋȦ The two relevant industries, namely, world Chemical ĿŠēƭƙƥƑǋ and ¡ĺîƑŞîČĚƭƥĿČîŕ ĿŠēƭƙƥƑǋ îƥ À¬ɐ ǪȦǬ ƥŠ îŠē À¬ɐ ǧȦǧ ƥŠ ijƑĚǅ ċǋ ǭɼ îŠē Ǭɼ ƑĚƙƎĚČƥĿǄĚŕǋ îŠē ƥūijĚƥĺĚƑ ƑîŠŒĚē ŠƭŞċĚƑ ƥĺƑĚĚ ĿŠ ƥĺĚ ǅūƑŕē ĚČūŠūŞǋȦ TŠēĿîŠ ĺĚŞĿČîŕ ĿŠēƭƙƥƑǋ îƥ À¬ɐ ǧǪǨ ċŠ îŠē TŠēĿîŠ ¡ĺîƑŞîČĚƭƥĿČîŕ ĿŠēƭƙƥƑǋ îƥ À¬ɐ ǩǩ ċŠ ijƑĚǅ ċǋ ǧǩɼ îŠē Ǯɼ ƑĚƙƎĚČƥĿǄĚŕǋȦ /ǄĚƑǋƥĺĿŠij we do and everyone we come across throughout our lifetime Ŀƙ ƥūƭČĺĚē ċǋ ČĺĚŞĿƙƥƑǋȦ ØĿƥĺ ƥĺĚ Ǩǭ ĿŠēƭƙƥƑĿĚƙ ƙĚƑǄĚē ċǋ our Company expanding, its own growth will correspond to our aspirations, energy, strength in science and technology and Values – our Company is well placed, and we are as ĚŠƥĺƭƙĿîƙƥĿČ îƙ ĚǄĚƑ îċūƭƥ Ŀƥƙ ċƭƙĿŠĚƙƙĚƙȦ In 2018-19, our Company further improved its performance – it realised standalone sales of ` 3,845 cr, against ` 3,052 cr, EBITDA margin of 20% against 17%, ƎƑūǛƥ ċĚljūƑĚ tax of ` 652 cr against ` 397 cr and ¤ū / of 32%against 22% in 2017-18 – consequently, earnings per share increased to ` 145 against ` ǯǧȦ ¹ĺĚ ūîƑē ĺîƙ ƑĚČūŞŞĚŠēĚē î ĺĿijĺĚƑ dividend ȳƥĺĚ ĺĿijĺĚƙƥ ƙū ljîƑȴ ūlj ǧǫǦɼ ȶ ƥĺĚ Ǝîǋȹūƭƥ Ŀƙ ǧǨȦǫɼȦ I look forward to your unanimous approval – our Company is implementing nine projects with an investment of ` 412 cr and also making an investment of ` 57 cr in its ƙƭċƙĿēĿîƑǋ îŠē ŏūĿŠƥ ǄĚŠƥƭƑĚ ĚŠƥĿƥĿĚƙ ȹ ƥĺĚ ŞūƑĚ ƥĺĚƙĚ ĿŠǄĚƙƥŞĚŠƥƙ îƑĚ ljƭŠēĚē ƥĺƑūƭijĺ ĿŠƥĚƑŠîŕ îČČƑƭîŕƙȡ ƥĺĚ ċĚƥƥĚƑȦ Of the total rise in sales of 26% in 2018-19, only 3% ČîŞĚ ljƑūŞ ijƑūǅƥĺ ĿŠ ǄūŕƭŞĚ ŞîĿŠŕǋ ċĚČîƭƙĚ î ljĚǅ ūlj ƥĺĚ manufacturing assets did not run to their potential despite ŞîƑŒĚƥ ēĚŞîŠēȦ ~ƭƑ ūŞƎîŠǋ Ŀƙ ĚǊƎĚČƥĚē ƥū ijĚŠĚƑîƥĚȡ ūŠ î ƙƥîŠēîŕūŠĚ ċîƙĿƙȡ îēēĿƥĿūŠîŕ ƙîŕĚƙ ūlj ` 846 cr from nine new projects ƭŠēĚƑ ĿŞƎŕĚŞĚŠƥîƥĿūŠ ȳîƥ ljƭŕŕ ČîƎîČĿƥǋȴȦ ¹ǅū of these projects are related to environment protection ȹ ĿŠ îċūƭƥ ǧǫ ŞūŠƥĺƙ ljƑūŞ Šūǅȡ ƥǅū ūlj ƥĺĚ ljūƭƑ ƙĿƥĚƙ ūlj ūƭƑ ūŞƎîŠǋ îƥ ƥƭŕ îƑĚ ĚǊƎĚČƥĚē ƥū ċĚČūŞĚ ǕĚƑū ŕĿƐƭĿē ēĿƙČĺîƑijĚ ȳèg'ȴȦ ŠŒŕĚƙĺǅîƑ ƙĿƥĚ Ŀƙ îŕƑĚîēǋ èg' ƙĿŠČĚ ǨǦǧǨȦ ¹ĺĚ ƙƭċƙĿēĿîƑǋ îŠē ŏūĿŠƥ ǄĚŠƥƭƑĚ ȳc×ȴ ĚŠƥĿƥĿĚƙ îƑĚ îŕƙū ŞîŒĿŠij ƙĚƎîƑîƥĚ ĿŠǄĚƙƥŞĚŠƥƙ ƥū ŞîŒĚ ƥĺĚĿƑ ƎŕîŠƥƙ èg'Ȧ Operating ƙƭċƙĿēĿîƑǋ ČūŞƎîŠĿĚƙ did well – Atul Bioscience crossed sales of ` ǧǦǦ ČƑ ljūƑ ƥĺĚ ǛƑƙƥ ƥĿŞĚ îŠē îČƐƭĿƑĚē î ŞîŠƭljîČƥƭƑĿŠij ljîČĿŕĿƥǋ ĿŠ ŞċĚƑŠîƥĺȡ qîĺîƑîƙĺƥƑîȫ '¡' is implementing an expansion project and will increase its capacity in 2019-20; Amal has steadily improved its ƎƑūǛƥȦ ¤ƭēūŕlj ƥƭŕ ĺĚŞĿČîŕƙȡ JV ǅĿƥĺ ¤ƭēūŕljȡ Ŀƙ ĚǊƎîŠēĿŠij Ŀƥƙ ljūūƥƎƑĿŠƥƙ îČƑūƙƙ TŠēĿîȦ TŠ ǨǦǧǮȹǧǯȡ ƥĺĚƙĚ ČūŞƎîŠĿĚƙȡ together, achieved sales of ` ǨǪǩ ČƑ îŠē ƎƑūǛƥ ċĚljūƑĚ ƥîǊ ūlj ` ǪǨ ČƑȦ ƥƭŕ ¤îŏîƙƥĺîŠ 'îƥĚ ¡îŕŞƙȡ c× ǅĿƥĺ ƥĺĚ HūǄĚƑŠŞĚŠƥ ūlj ¤îŏîƙƥĺîŠȡ Ŀƙ ƙƥîċĿŕĿƙĿŠij Ŀƥƙ ƎƑūēƭČƥĿūŠ ljîČĿŕĿƥǋȦ ŠîǄĚŠȡ c× ǅĿƥĺ sūƭƑǋūŠȡ Ŀƙ ĚǊƎĚČƥĚē ƥū ƙƥîƑƥ ƎƑūēƭČƥĿūŠ ĿŠ ĚîƑŕǋ ǨǦǨǦȹǨǧ ȶ ƥĺĚ ƎƑūŏĚČƥ Ŀƙ ƑƭŠŠĿŠij ċĚĺĿŠē ƙČĺĚēƭŕĚȦ Atul Foundation ČūŠƥĿŠƭĚƙ ƥū ƑĚîljǛƑŞ ƥĺĚ ƭŕƥĿŞîƥĚ ƎƭƑƎūƙĚ ūlj î ƑĚƙƎūŠƙĿċŕĚ ČūŞƎîŠǋ îŠē ĺĚŕƎƙ ƭƙ ēĚƥĚƑŞĿŠĚ Ŀlj ǅĚ îƑĚ ƑĚŞîĿŠĿŠij ƥƑƭĚ ƥū ūƭƑ ŕĚijîČǋȦ 'ƭƑĿŠij ǨǦǧǮȹǧǯȡ the Foundation and entities under it took up initiatives in the areas of national priorities, namely, conservation, ĚēƭČîƥĿūŠȡ ĚŞƎūǅĚƑŞĚŠƥȡ ĺĚîŕƥĺȡ ĿŠljƑîƙƥƑƭČƥƭƑĚ îŠē ƑĚŕĿĚljȦ Kalyani School, Atul Vidyalaya and Atul Vidyamandir are ČūŠƙĿēĚƑĚē îŞūŠijƙƥ ƥĺĚ ċĚƙƥ ČĚŠƥĚƑƙ ūlj ŕĚîƑŠĿŠij îŠē Atul Adhyapika, OūƭƙĚĺūŕē ¹ūĿŕĚƥƙ îŠē ¹ƑĿċîŕ 'ĚǄĚŕūƎŞĚŠƥ îƑĚ ƙūŞĚ ǄĚƑǋ ijūūē ĿŠĿƥĿîƥĿǄĚƙȦ TŠ Ŀƥƙ ƙŞîŕŕ ǅîǋȡ ƥĺĚ GūƭŠēîƥĿūŠ ČūŕŕîċūƑîƥĚē ʈ ƙƭƎƎūƑƥĚē ūƥĺĚƑ ūƑijîŠĿƙîƥĿūŠƙ ĿŠ HƭŏîƑîƥȡ eĚƑîŕîȡ qîĺîƑîƙĺƥƑî îŠē ¤îŏîƙƥĺîŠȦ 'Ƒ ¬îƥijƭƑƭ îĿŏîŕ îŠē qƑ OîƙŞƭŒĺ ¬ĺîĺ ēĚČĿēĚē ƥū ƙƥĚƎ down as Non-executive Directors after 35 and 27 years ƑĚƙƎĚČƥĿǄĚŕǋȦ ¹ĺĚĿƑ ČūŠƙĿƙƥĚŠƥ îŠē ƙĿijŠĿǛČîŠƥ ČūŠƥƑĿċƭƥĿūŠ ċƑūƭijĺƥ ēĚƎƥĺ îŠē ċƑĚîēƥĺ ĿŠ ƥĺĚ ēĚŕĿċĚƑîƥĿūŠƙ ǅĺĿČĺ ƥūūŒ place in the Board and its Committee meetings; they were also a source of immense strength and learning for me – On ċĚĺîŕlj ūlj ƥĺĚ ūîƑē îŠē ŞǋƙĚŕljȡ T ǅĿƙĺ ƥū ƥĺîŠŒ ƥĺĚŞ ljūƑ ƥĺĚĿƑ ƎƑūljĚƙƙĿūŠîŕ ƑūŕĚ ǅĿƥĺ î ƎĚƑƙūŠîŕ ƥūƭČĺȦ qǋ ČūŕŕĚîijƭĚƙ îŠē T îƑĚ ijƑîƥĚljƭŕ ƥū ƥĺĚ sūŠȹĚǊĚČƭƥĿǄĚ 'ĿƑĚČƥūƑƙ ǅĺū ĚŠƑĿČĺ ƥĺĚ Management with their critical analysis, deep involvement îŠē ČūŠƙƥƑƭČƥĿǄĚ îƎƎƑūîČĺȦ Corporate Overview 01-22 Statutory Reports 23-105 Financial Statements 107-250 ƥƭŕ gƥē ʈ ŠŠƭîŕ ¤ĚƎūƑƥ ǨǦǧǮȹǧǯ