Dear Shareholders,
It gives me immense pleasure to welcome you to our 29th
Annual General Meeting of Shankara Building Products Limited. Trust all is well with you
and your family. I am delighted to inform all of you that your Company has achieved its
highest ever revenue and profits.
The financial year 2023-24 started relatively on a sedate
note after the hurly-burly of 2022. Commodity prices were largely subdued throughout the
year. The demand from building material industry was also relatively muted. The government
expenditure on infrastructure continued unabated during the course of the year. This
helped your Company's growth in the steel segment.
The Country went into election mode in the second half of
the financial year. This resulted in some slowdown in the payment cycle and consequently,
in demand. The election was conducted over almost forty-five days and it did have some
impact in Q4 of 2023-24 and a definite impact in Q1 of the current year. A stable
government at the center will augur well for the Company's growth prospects.
Your Company has proposed a demerger of its core business
which is retail and a market place for building materials into its wholly owned subsidiary
Shankara Buildpro Limited. Consequent to the approval by the Board of Directors of
Shankara, the Company has filed the scheme of arrangement with the stock exchanges. Your
Company felt the need for the demerger to focus better on its many diverse businesses and
thereby unlock greater value for the shareholders.
The demerger will result in two entities. Shankara Building
Products limited which will be the legacy company housing the three subsidiaries (Taurus
Value Steel & Pipes Private Limited, Vishal Precision Steel Tubes & Strips Private
Limited and Century Wells Roofing India private Limited). The second entity will be
Shankara Buildpro Limited ("Buildpro") which will carry out the current core
business of retailing and market place of building materials.
As per the scheme of arrangement, it is proposed that the
existing shareholders of Shankara Building Products Limited will be allotted 1:1 shares in
the resultant entity as per the statutory norms.
I would now like to share with you the key highlights of
your Company's good performance during the reported year.
Financial year 2023-24
Your Company generated a total revenue of 4,828 crores in
FY24 as compared to 4,030crores in FY23, a growth of 20%. 2,556 crores (53%) was from our
retail vertical. The channel and enterprise business recorded 2,272 crores. Our PAT stood
at 81 crores, a growth of 29%, vis-?-vis the preceding year. South India continues to be
the major contributor of our business (86%). However, we have seen a good growth (46%) in
the western region and now accounts for 11% of our total revenue. Our store metrics
continue to show healthy traction.
The Company offers a fairly comprehensive range of building
materials starting from TMT, cement, and construction chemicals to plumbing, sanitary ware
and fittings, tiles, adhesives and surfaces. We also have electrical, lighting, paint,
modular kitchens, hardware and appliances that form a part of our portfolio. MS tubes,
structural steel and roofing solutions, complete our basket of offerings. There have been
numerous brand additions during the year. We had launched our private label tiles under
the brand name Fotia which has gained wide acceptability. The Company will continue to
focus on promoting its key brands. We also have plans to expand the non-steel business and
retail outlets to Telangana.
The Company continues to rely on its digital platforms like
the Buildpro e-commerce website (www.buildstore.com) and its mobile app (Shankara
Buildpro) to create product awareness amongst potential customers and drive them to our
offline stores. Shankara has a robust digital marketing program and is further refining
its SEO activity.
Key Performance Highlights
20% revenue growth in FY 24 as compared with FY 23 &
highest revenue 25% EBITDA growth for FY24 as against FY23 29% PAT growth in FY24 compared
with FY23 highest profit since inception
People and Culture
The Company believes that its most important assets are its
human resources. Therefore, we have in place a simple but effective response mechanism to
respond to the needs of our employees. Keeping the same philosophy in mind, your Company
treats its customers with utmost respect and endeavor to meet their requirements to the
best of our ability.
Your Company's work culture is transparent and
performance-based. It strives to retain, develop and provide a better working environment
for employees by creating an atmosphere of trust, competition, and challenge, thereby
providing opportunities for personal and professional growth.
Corporate Governance & Social Responsibility
Good corporate governance is essential to ensure
transparency and to boost stakeholder trust and confidence. Shankara complies with all
applicable provisions within its ambit, relating to corporate governance as stipulated
under the Companies Act, 2013, SEBI (Listing Obligations & Disclosure Requirements)
Regulations. Your company maintains the highest standards of transparency, accountability
and adequate disclosures.
We are committed to our CSR activities. We do a lot of good
work with the community. We run two schools for abandoned children with the help of a NGO.
We have about 75 children who study with us and are provided schooling as per the state
boards. We also take care of their accommodation, food and clothing. One of the important
CSR objectives of Shankara is to contribute towards the environment. We support a
water-shed program in Tumkur district of Karnataka which is also one of the driest parts
of the state.
Appreciation
In conclusion, I would like to thank all our stakeholders
and partners for their support. My fellow Board Members have been extremely committed and
have provided continued guidance for the betterment of Shankara. And I am also deeply
appreciative to the management team and employees for diligently carrying forward the
Company's vision and strategy.
I firmly believe that Shankara has the ability to seize the
opportunities in this fast-changing world. I am confident that we shall continue to
perform better and the management endeavors to take your Company to greater heights in the
years ahead.
Best Wishes,
V. Ravichandar
Chairman