Indo Rama Synthetics (India) Ltd.’s net revenue for the quarter ended March 31, 2014, stood at Rs. 693.47 crores as against Rs. 706.99 crores of Q4 of the previous year. The EBIDTA for the period stood at Rs. 56.38 crores (Rs. 22.19 crores) and net loss at Rs. 14.17 crores (Rs. 38.06 crores).
For the year ended March 31, 2014, the net revenue stood at Rs. 2,629.12 crores as compared to Rs. 2,910.13 crores in the previous year. For the full year, EBIDTA stood at Rs. 145.08 crores (Rs. 243.19 crores). Net loss for the year was Rs. 8.18 crores as against profit of Rs. 41.26 crores the previous financial year.
The last financial year saw slow demand for polyester in India as well as overseas. The industry faced lots of economic challenges in terms of squeezing of margins due to the high raw material prices and the interrupted supply. The year also witnessed one of the worst phases for the rupee, and fluctuations in crude oil prices led to squeezing of margins. However, the higher prices weren’t passed to the customers, thus forcing the margins to remain lower.
Commenting on the company’s performance, Mr. O.P. Lohia, Chairman & Managing Director, said: “On the back of India’s burgeoning population, rapid urbanisation, enhanced industrialisation, increasing cotton prices and insignificant cotton production growth, I am hopeful that polyester consumption will increase substantially in the coming years. While the entire world is fighting economic downturn we have been weathering the tough environment and have been strengthening our cost competitiveness by virtue of cost rationalization. With the new government at the Centre, we hope that the much-needed impetus would be generated to bolster interest in this sector and enable creation of new jobs, pushing up GDP growth and bringing alive the dream of inclusive growth”.
India has low per capita man-made fibre consumption at three kg per annum as against the global average of eight kg. This indicates untapped potential for polyester manufacturers, providing scope to grow positively.
Indo Rama has demonstrated its resilience in the challenging environment last year. It took some cost improvement initiatives, which will further add to the company’s competitiveness. With the polyester prices bottoming out and the rupee stabilizing, the company performance would hopefully improve.
The company has also been able to make optimum utilization of available resources so as to keep up its operational efficiencies. It hopes to see improvement in the overall economic environment that should help it perform better in the coming year. With demand expected to pick up, the following quarters will be much better than the previous ones.