Dear Shareholders,
I sincerely hope you and your loved ones are staying safe and healthy. As COVID-19
pandemic impacted countless lives and created uncertainty amongst economies and businesses
at large, I am pleased to report that NPL responded with agility and resilience to sustain
growth and ensure business continuity. As Wadia Group’s flagship manufacturing
company, and the largest manufacturer of hydrogen peroxide, we have always strived to
create value, despite operating in a commodity business.
As a pioneer and largest manufacturer of Hydrogen Peroxide (H202) in the country, we
boast a complete value chain of chemistry within H202 that includes hydrogen peroxide,
compressed hydrogen gas as well as peracetic acid. Creating a niche market, we serve large
companies operating across multiple downstream industries with our products, earlier
imported in the country.
COVID-19 did pose challenges to our business in the first quarter of FY21, as demand
slowed and the supply chain were disrupted due to lockdown and minimal movement of people
and goods. However, as the lockdown restrictions eased, demand picked up and we served our
customers with agility and speed.
Notwithstanding the trailing impacts of the pandemic, we continued to make progressive
investments in our already established R&D facility. It continues to deliver
excellence, helping us expand our markets into new downstream sectors with sustained
product innovation. It gives me great pleasure to report that during the fiscal we started
our journey of export, emerging as the largest exporter from India for H202.
Performance Highlights
This year, we reported a consolidated revenue of H 21,500 lakhs, 12.43% higher than
previous year. Our EBIDTA stood at H 4,244 lakhs and PAT for the year was at H 2,117
lakhs. Nonetheless, we sustained our profitability levels year-on-year driven by focused
customer centricity and implementing cost-controls across the product value-chain. Prudent
financial management helped generate cash flow, resulting in an interest coverage ratio of
3.16 times.
Creating value
Over the years we continue to override the perception that we operate in a
commodity-driven segment with minimum value creation. However, our value-accretive
business model rests on key strengths that generate value for our stakeholders. First, our
growing customer base with growing trust forms the foundation of our market share.
Further, our recent foray into export market marks a new chapter of growth in our
corporate journey and we are optimistic of expanding our international presence in the
coming years.
Second, our operational excellence remains cornerstone of our business. Our process
innovations, energy conservation methods and enhanced capacities allow us to achieve
greater economies of scale to deliver products with highest quality.
Third, measures taken to strengthen our balance sheet ensured that the key ratios
stayed healthy. Our aim is to grow our earnings in line with recurring Free Cash Flows and
reduce our long-term debt by year 2024.
Restructuring
Moreover, in our quest to create more value for our stakeholders, we are restructuring
our organization by demerging our chemical business into NPL Chemicals Ltd., and merging
our subsidiary company, Naperol Investments Ltd., engaged in the business of making long
term investments and corporate lending .
This restructuring is aimed at segregating different businesses with different risk and
return profiles. It also allows investors to put their money in a company that best suits
their investment strategies and risk profile. This strategy is expected to bolster our
growth aspirations as well as create value for stakeholders.
NPL and future
The year marks an important in chapter in our legacy. While COVID-19 posed challenges,
we mitigated the risks with proactive measures in place. We prioritized employee health
and safety over business growth. People development has always been our key focus, and we
continue to recruit and retain talented individuals across our company. We implemented
safety protocols at our plant and office in guidance with the government regulations.
We welcome the new year with lot of expectations. We thrive to reduce our operational
costs so as to offer competitive pricing for our customers. Leveraging on our newly set-up
R&D unit, we are also looking forward to widen our product applications across new
downstream sectors.
I would like to thank the Board of Directors, Shareholders, Customers, and Employees
for their continuous support and trust in our Company. I am very grateful to everyone who
has contributed to this growth and I look forward to continuing with you on this exciting
journey.
Rajiv Arora
Chief Executive Officer & Director