The company held its AGM on 6 Sep 18 and was addressed by Mr. Deepak Dhanak MD
Key Highlights
There is a constant increase in demand of thermoplastic elastomers (TPE) in India particularly from auto and consumer durable sector. Government regulations and norms are also aiding this growth.
TPE provide safety, comfort, long lasting and strength to plastics.
Company's products also find application in the 4G network which uses TPE for long lasting and reliability.
The company continues to increase its value added product sale and increase its presence in high performance applications.
The product mix is continuously improving. Value added products which accounted for around 10% of sales 3 years back has reached to around 23-25% in FY 18. Management aims to further increase the sale of value added products to around 40% of sales in coming 3 years.
Company imports around 70% of its raw materials from Parent and others. Rupee depreciation and higher crude prices is hurting the company's margins which got impacted in June 18 quarter. While high value added product sales and passing of increases is helping to aid margins to some extent, in short term such an increase of costs cannot be fully and immediately passed on.
Expects margins to remain under pressure in FY 19 on YoY basis despite increase in volumes and value added sales.
Expects volume growth of around 10-12% in FY 19.
Parent plans to introduce new products for India. Parent sees Indian operations and products to be used and developed for Indian markets. It doesn't see Indian operation as outsourcing base.
However, parent does perform some R&D initiatives in India for the global market. |