The Manufacturing Division has performed well this year with an increased focus on value addition, strategic sales and organisational development. We are pleased to report a 32% increase in profit and a 11% increase in revenue over last year. Profitability has improved by 29%.
Pigment division: Over the past year, we have continued to focus on product customisation based on customer need, and on expanding our global footprint. Our focus on customisation of products has yielded better volumes in the export markets. Initiatives taken on Research and Development activities helped launch new products and gain customer confidence and loyalty. The Pigments division achieved a net revenue of Rs. 87.42 crores in this financial year (as compared to Rs. 72.61 crores in the previous financial year) and showed a 20% increase in value. This year, it has achieved the highest volume and the highest value of Industrial sales in the Company’s history.
Surfactants division: This year, as a part of our diversification and value addition plan, we have introduced a variety of surfactants for the home and personal care industry, besides value addition in our existing basket of products. The Surfactants factory in Ranipet is running at full capacity. With a focus on optimising the product mix, and increased value addition for the customer, the division has seen a 13% increase in both sales volume and profit over the previous year. The Surfactants division increased its revenues by 7% to Rs. 159.69 crores in financial year 2017-18, as compared to Rs. 149.47 crores in financial year 2016-17. Your company is developing a new surfactants manufacturing facility in an Industrial Park in Naidupeta, Nellore Dt, in a plot of land acquired from the Andhra Pradesh Industrial Infrastructure Corporation. This upcoming facility will have the ability to manufacture all the existing surfactants in our portfolio, and will have the requisite space for future expansion when deemed necessary.
Export earnings from Manufacturing went up by 41%. This increase was facilitated mainly by the greater volumes of high value pigments sold on the global market. It was also assisted by the addition of exports sales in the surfactants business, especially in the Asian market.
During the financial year under review, this division reported an income of Rs. 30.25 crores which is lower by Rs. 1.11 crores when compared to previous financial year. ITeS services like publishing, health care and other BPO segments are highly competitive. The stiff competition and sudden entry of large IT companies impacted revenue growth and profitability.
Your Company is setting up a greenfield surfactants project with an annual installed capacity of 30,000 Tonnes in Naidupeta, Andhra Pradesh. The estimated project capital outlay for the same is approximately Rs. 70 Crores. The Company will contribute one third of the planned capital outlay out of surplus funds and the balance by way of a term loan. We expect to commence commercial production by third quarter, 2019.
Company is debt free and has investments in Thirumalai Chemicals valued at Rs. 349 crores as on March 31st 2018.