It is my privilege to write to you as the Chairman of this company. I, on behalf of the Board of directors, express sincere gratitude for your support for all these years. I have to inform you that this year is the Birth centenary of Late Shri Ravi L. Kirloskar, the founder of this company, who has always been a source of inspiration to all of us.
On behalf of the Board of directors, I am pleased to present the 70th annual report for your company for the financial year 2016-17.
The year 2016-17 continued to be another challenging year though the global economy is improving, with global GDP growth projected to increase to around 3.1% in 2018-2020. However, it remains vulnerable to geo-political tensions, high interest rates and high volatility in currencies.
Amongst the emerging economies, India has comparatively outperformed others. The medium to long-term economic outlook in India continues to look promising and it is further encouraging seeing the Government’s measures to continue to liberalise the economy and focus on social sector spending. It is further encouraging seeing the Government’s measures for fostering investments, and ease of doing business, in India. Some noteworthy new initiatives are in the form of Make-in-India, Invest India, Start up India and e-biz Mission Mode Project under the national e-governance plan. Over the medium run, the implementation of the Goods and Services Tax (GST), after demonetisation, and enacting other structural reforms should take the economy towards its potential real GDP growth of 8 per cent to 10 per cent. The GST will create a common Indian market, improve tax compliance and governance, and boost investment and growth.
Indian power sector is undergoing a significant change that has redefined the industry outlook. The demand for power in the country has increased rapidly and is expected to rise further in the coming years. The Government of India’s focus on attaining ‘Power for all’ has accelerated capacity addition in the country. It has identified power sector and renewable energy, namely, solar power and wind energy as key sectors of focus to promote sustained industrial growth. At the same time, the intensity of competition is increasing both at the market and supply sides, resulting in negative pressures on the prices of the products. In this direction, your company has taken several initiatives to remain competitive by reducing cost, optimizing the manpower and streamlining operations. The strong brand image of the company’s products puts us in an advantageous position.
During the year, your company continued with more vigour focus on achieving more profitability, efficiency, increasing productivity and improving skills of human resources by undertaking a number of measures.
We are adopting all possible measures to mitigate the losses, at a time when there are pressures on cost in terms of lower demand, slower project execution and clearances, increase in interest burden and lower turnover. Your company is taking steps to overcome these challenges by improving upon efficiency, productivity and enhancing skills of human resources by a continuous process of learning & development.
We will continue with our efforts to further strengthen the operations and resource base of your company and we are sure that your company will overcome these challenging times.
I express my sincere thanks to the shareholders, lenders, bankers, financial institutions, vendors, customers and all other stake holders. I express my sincere thanks to the employees of the company for their support during these hard times
Vijay R Kirloskar Executive Chairman