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Atul Ltd | Annual Report 2014-15
Dear Shareholder,
During the fiscal, we pursued the Purpose enunciated
by our
karmayogi
Founder, Mr Kasturbhai Lalbhai, while
endeavouring to imbibe, nourish and promote the
Values he so fondly cherished. We remained committed
to continuing his legacy of conducting business that
reflects its true purpose. To actualise this, we prepared
ourselves further for growing meaningfully in a more
competitive world; simultaneously we worked so as to
consistently and increasingly give back to each section
of the Stakeholders.
2014 was a year of optimism for many economies – the
world GDP
grew by 3.4% to US$ 77.3 t. The USA led the
show – its GDP grew by 2.4% to US$ 17.4 t, that of China
grew by 7.4% to US$ 10.4 t and that of Euro Area grew by
0.9% to US$ 13.4 t. The GDP of India grew by 7.2%* to
US$ 2.1 t. 2015 has had a shaky start – many believe that
recession is likely to plague some economies, and demand
is likely to remain subdued at least in the first half.
World Chemical Industry
, the size of which is US$ 4.3 t,
grew by 2.5%. India at US$ 100 b* grew at 4% and
continued to remain at number 7. China at US$ 1.5 t
grew at 5% and maintained its number one position.
The other five countries ahead of India, namely the USA,
Japan, Germany, South Korea and France, showed
growth between -0.8% and 4% in 2014. The Industry is
expected to grow slower at 2% during 2015; nonetheless
we will work with focus and optimism and promote the
‘Make in India’ theme in our own small way.
Our Company put forward improved
results
for the
fiscal: sales grew to
`
2,510 cr (
↑
9%), EBITDA increased
to
`
391 cr (
↑
8%) and PBT from operations increased
to
`
312 cr (
↑
13%). EBITDA margin at 16% remained
almost unchanged because of increase in fixed costs.
The increases in sales and profit were small – indeed,
we believe that we have the potential to perform
significantly better. The Board has recommended a
dividend of 85%, the highest so far, reflecting
confidence in the future.
*2014-15
During the fiscal, our Company completed 4
projects
with an investment of
`
33 cr which are expected to
generate sales of
`
143 cr at full capacity utilisation;
7 projects with an investment of
`
321 cr are underway,
which on completion, at full capacity utilisation, are
expected to generate sales of
`
554 cr, and it will be
within the reach of our Company to aim for achieving
sales of
`
4,000 cr in 2017-18, as we see at present. In
addition, we are continuously taking up small capital
expenditure proposals for debottlenecking and
upgradation as we believe we have a lot to harness
and optimise from what we already have.
The
subsidiary and joint venture companies
have
further improved their performance: Atul Bioscience
grew its sales and PBT by 37% and 50% to
`
47 cr and
`
6 cr respectively. Rudolf Atul Chemicals increased
its sales and PBT by 42% and 55% to
`
43 cr and
`
8 cr
respectively. DPD grew its sales and PBT by 17% and
9% to £ 1.6 m and £ 0.3 m respectively. Atul Rajasthan
Date Palms will commence sales only during 2015-16.
The proposal to merge Amal Ltd, an associate company,
was approved by the Board of our Company.
Atul Brasil Quimicos, a subsidiary of our Company,
is expected to help grow sales in South America.
Atul USA, Atul Europe and Atul China have further
improved their sales and are expected to increase
trading of products other than those manufactured
by our Company. Our Company established Atul
Middle East FZ-LLC for growing sales in that part of
Asia and Africa. These actions reflect the aspirations of
our Company to grow across the world and focus on
better, more informed
service to our customers
.
Atul Foundation (Trust) under which all other trusts,
institutions, etc promoted by our Company related to
social responsibility
are placed, continued to serve the
society mainly in the areas of education, empowerment,
health, relief, infrastructure and conservation. Page
number 18 will give a broad idea about some initiatives.
The creation of Atul Institute of Vocational Excellence,
replete with world-class infrastructure facilities (which
Letter to the Shareholders