I am also pleased to report that since our listing, your Company's market
capitalisation has grown 24.7% from issue price to ' 1,568 Cr as of March 31, 2021.
Dear Shareholders,
For Stove Kraft, perhaps nothing can capture the emotion of fiscal 2021 better than the
phrase from Dickens' A Tale of Two Cities - "It was the best of times, it was the
worst of times". While our maiden public issue received an overwhelming response, as
an organisation we are deeply anguished by the loss of lives and human suffering during
the second wave of the COVID-19 pandemic in India.
On behalf of the Board, we offer our deepest condolences to the bereaved families. I
would also like to take this opportunity to extend our heartfelt gratitude to the extended
family of Stove Kraft - our employees - who came together and worked tirelessly to turn
around our fortunes, under these exceptional circumstances. At Stove Kraft, human capital
is the primary capital.
Before I take you through our performance highlights for the year, let me briefly
introduce your Company. Stove Kraft has grown from a single brand small LPG stove
manufacturing company to become one of India's leading manufacturers of home and kitchen
products. Today, we have well-recognised brands across price segments in our portfolio,
giving us a significant edge in reaching out to consumers across the country and scaling
our business. We are consistently investing in innovation to bring a wide array of
meaningful kitchen and home products that make the lives of our consumers easier, better
and safer. Our well-equipped and backward integrated manufacturing facilities and
well-connected distribution network further underpin our ability to control and monitor
product quality and costs.
In addition to growing our domestic business, we are also steadily tapping global
opportunities.
Since our inception, your Company has always strived to deliver better value for all
its stakeholders. Our successful listing on the bourses on February 5, 2021 reaffirms the
faith reposed by our investors in our business model. We are truly grateful for your
confidence and support and look forward to keeping you apprised of our business
performance. The net proceeds from the issue have been utilised towards reducing our debt.
Our endeavour is to become completely debt free in the near future. I am also pleased to
report that since our listing, your Company's market capitalisation has grown 24.7% from
issue price to ' 1,568 Cr as of March 31, 2021.
During FY 2020-21, the nationwide lockdown resulted in our manufacturing and sales
activities being temporarily shut down during the first quarter. Despite this business
disruption, we reported solid results for the full year by reopening our operations in a
phase-wise manner and demonstrating agility in responding to emerging consumer needs,
while always ensuring the health and safety of our workforce. Further, the Coronavirus
outbreak has inculcated habits of home cooking, with consumers
Going forward, India's favourable macroeconomy will continue to provide us with
significant growth opportunities.
Rising discretionary income, growing urbanisation and a young demographic profile will
drive retail spending, including for home and kitchen products. becoming more health
conscious and spending more time at home, thereby increasing the demand for kitchen and
home goods. Driven by increased sales volumes, total revenue for FY 2020-21 stood at ' 859
Cr an increase of 28% from the previous year despite having a muted first quarter. Our
strong focus on rationalising costs and improving our efficiencies enabled us to report
robust EBITDA and PAT numbers of ' 113 Cr and ' 81 Cr, respectively.
Several steps were taken to adapt our operations to the COVID-19 pandemic as well as
align it with our overall strategy. First, we reduced our supply-chain dependence on
China. Second, we played to our strength of manufacturing by indigenising several products
that have reached the desired scale.
FY 2020-21, we shifted from outsourcing to in-house production for kettles, choppers
and induction cooktop, among others. In-house manufacturing has lowered our costs, with
some of these savings being passed on to the consumers. The reduced prices have made our
products accessible to a larger consumer base, setting in place a virtuous cycle of
scaling demand and putting momentum
In a pandemic-stricken year, our topmost priority has been the health and safety of our
people. COVID-19 appropriate protocols have been strictly implemented at all our
locations. behind Stove Kraft in achieving leadership in these product categories.
Moreover, despite the pandemic we continued to invest in growing our distribution network
to benefit from increased demand for certain products and to take advantage of new
business opportunities. Our strategic decisions rewarded us well, as reflected in the
increased traction in our product volumes.
The raison d'etre for your Company is the consumer Today, we can manufacture around
1,25,000 products in a day. Our consumers experience the joy of a high-quality product at
an unbeatable price, and, in turn, become our greatest marketing asset. Our new products
thus enjoy a large consumer base to get faster adoption. With our scalable business model,
we are increasing our consumer reach every day, driving our ability to create a thriving
and sustainable business.
Going forward, India's favourable macroeconomy will continue to provide us with
significant growth opportunities. Rising discretionary income, growing urbanisation and a
young demographic profile will drive retail spending, including for home and kitchen
products. Further, India's urban consumers no longer view kitchen products merely as
functional tools but as a part of their aspirational lifestyle. Seeking contemporary,
stylish kitchen gadgets, convenience in cooking, and modular kitchens to make the best
utilisation of limited
space in small houses, this aspiring consumer segment will drive demand for our modern
kitchen solutions. Increased internet penetration, growth of e-commerce and growing
influence of social media is also boosting the demand for better kitchen products. In the
rural segment, government initiatives such as Pradhan Mantri Ujjwala Yojana, which
provides for free LPG connections, has increased our addressable market opportunity.
As one of the leading cooktop manufacturers in the country, we are well-positioned to
leverage this vast network of rural households.
As we move ahead in our journey, several strategies are core to our future success.
First, we will continue to focus on expanding our product portfolio across categories to
cater to the evolving requirements of a large consumer base and cover newer consumer
segments. In addition to meeting the demand for home and kitchen products, we also seek to
capture the growing demand for LED lighting products. Second, we will effectively market
these products by scaling up our branding, promotional and digital activities. Third, we
aim to increase the level of automation at our manufacturing facilities to extract greater
efficiencies across the value chain, from design to commercial production. Fourth, we will
continue to enhance our addressable market through our wide distribution network. Finally,
we will continue to work towards increasing our reach in overseas markets. Our growth
strategies are underpinned by the Company's healthy financial position, supporting our
ability to invest in our capabilities and deliver sustainable performance.
In a pandemic-stricken year, our topmost priority has been the health and safety of our
people. COVID-19 appropriate protocols have been strictly implemented at all our
locations. We continue to follow all safety measures to ensure the well-being of our
people and maintain business continuity.
As you are reading this report, we are also happy to inform you that 100% of our
employees have been vaccinated.
During the pandemic, your Company has taken several initiatives to help the community
where we live and work. We provided several neighbourhood families with their monthly
ration and donated oxygen concentrators to the district. We also provided ten nearby
villages with a communal pure drinking water plant. The plant is capable of providing
sustainable and free drinking water to the entire village.
In closing, I would like to once again take this opportunity to thank our people for
the commitment and hard work they have demonstrated in this
unprecedented year. Their outstanding efforts enabled us to deliver a commendable
performance.
I would also like to convey my gratitude to our Shareholders, Consumers, Board members
for their unwavering support, along with our dealers, distributors and suppliers for being
an important part of our journey. At Stove Kraft, we are truly excited about our growth
potential and are confident in our ability to deliver. I look forward to the years ahead
as we continue to build an amazing company that benefits all stakeholders.
Warm Regards,
Rajendra Gandhi
Managing Director