What we see today are but reflections of tomorrow. Not surprisingly then, the potential for future growth is rooted in the strength of today’s foundations. Our improved performance during FY 2015 is thus a clear indication that we are on the right path to future progress. The positivity witnessed during FY 2014 was further strengthened during the year under review, as reflected in our augmented returns. Your Company has posted a profit of ` 42.02 crores as against a loss of ` 46.78 crores in the previous year.
The growth was in line with the improved sentiment in the economy and the industry. Globally, as advanced economies showed a pick-up and developing nations remained in a slowdown phase, the overall growth settled at 3.4 percent - the same as in the previous year. Marked improvement in income growth and overall consumer sentiment in several developed and developing economies augured well for the glass industry. The automotive industry seemed to be finally looking up, with the Chinese and US markets balancing the downturn in Europe. The renewed confidence in the global economy also pushed growth in the construction sector – another key driver of growth for the glass industry.
The Indian economy also showed revival in sentiment, as reflected in the GDP growth of 7.3% (as per revised CSO figures). Both the construction and auto sectors showed significant improvement, positively impacting the glass industry. Low oil prices and declining inflationary trends further contributed to resurgence in the industry.
Encouraged by the macro environment and the continuous internal improvement efforts, your Company posted good results across both, the Auto and Architectural segments. Net sales at 2096.58 crores were only marginally lower than the previous year, considering the drop in Architectural segment sales on account of the closure of one of our plants. Despite the plant shutdown, margins in the segment, which has shown are markable turnaround in just two years, actually increased. Overall, EBIDTA before forex losses increased to 343.23 crores from 287.38 crores in the previous fiscal, marking an increase of nearly 19.43%. After a long wait and the endeavours of the management, the Company reported net profit of 42.02crores– a reflection of the strong foundation we are successfully building for higher growth, going forward.
The competencies we have consistently built into our systems and processes have, in large measure, contributed to this positive performance. With our competitive edge through the value chain in Auto Glass and Architectural Glass segments, we have successfully capitalised on the new opportunities for growth, triggered by the improved industry sentiment.
The float glass industry has major potential for growth in India and has, over the last few years, seen some large investments into new capacities. The architectural processing segment has also been witnessing higher pace of growth in recent years. Amid evolving consumer aspirational needs, value-added glass is fast picking up demand, gaining popularity in residential buildings too, apart from the retail and commercial asset classes. With our early advantage in developing value-added glass offerings, we are well placed to harness the impending boom. The Real Estate industry, already showing signs of revival on the back of Government initiatives, is projected to touch $180 billion by 2020, offering huge potential for growth. The new Government proposals, such as development of 100 smart cities, as well as focus on roads, railways, manufacturing hubs etc., are also expected to boost the opportunities for growth in this segment. The ongoing shift towards Green Buildings shall only further push demand for high performance glass, opening up a huge opportunity for expansion in the architectural segment. The auto industry in India is also growing rapidly and as a leading, world-class integrated player, AIS has remained as the preferred supplier of quality glass to global OEMs. Our leadership in this segment continues to push the Company’s growth as we surge forward with our innovative, diversified and cost-competitive offerings, backed with excellence in service. It gives me immense pleasure to share with you that the Roorkee plant of AIS was awarded with a certificate of merit in National Energy Conservation 2014 by the Government of India. During the year, Mr. K. Ichikawa and Mr. H. Nohara, Nominee Directors of Asahi Glass Co. Ltd., Japan (AGC), resigned from the Board and Mr. M. Takeda and Mr. M. Omae joined the AIS Board. Also, Ms. Shradha Suri was inducted as an independent director.
I am sure their rich experience and expertise will add immense value to our Company. It is my sad duty to also inform you that Dr. Surinder Kapur, Director on the AIS Board since 24th December, 1988, passed away on 30th June, 2015. I thank Dr. Kapur for his exemplary service to AIS. The future beckons us with its bouquet of opportunities and our performance today is steering our growth forward as we prepare to make the most of these. We see in the landscape for tomorrow the reflections of huge prospects for exemplary progress. Steered by our focus on delivering energy-efficient glass solutions to our customers and conserving the environment, we look forward to a future where each of us is individually responsible for the collective good of all. I thank you all – our shareholders, customers, employees and other stakeholders, for your unwavering support and cooperation to our growth agenda, and am confident that together we shall move forward with renewed confidence in our abilities to chart a new roadmap for collective advancement.
With best regards,
B. M. Labroo