Garware Wallropes

AGM on 2nd Sep & was addr by Mr. Vayu Garware CMD.Highlights by Capital Mkt
Newer Geographies, more and innovative products, more sale of high value added products, higher exports etc were the main reasons for around 14% growth in sales and about 61% growth in PAT for FY’15.
Based on user industry, broadly Company’s business is divided into various segments such as Fishing, Aquaculture, Agriculture, Geosynthetics, Sports, Coates fabrics, Ropes etc. Fishing is more of traditional business which is about 20% of total turnover, Aquaculture constitute about 15-20%, Agriculture about 15-20%, Ropes about 13%, Sports about 10%, Geosynthetics about 7% and rest would be from various other segments.
Company launched several solutions in Acquaculture industry, which was well received by the markets and particularly in exports. Management expects the segment to continue to do well in FY’16 as well.Exports now account for about 49% of total sales and grew by about 13% YoY in FY’15. Management expects export to hover around 50-55% of total turnover. Company exports to more than 75 countries. North America, Europe and Australia are the major markets.There was a forex gain of around Rs 1.35 crore for FY’15 as compared to forex gain of around Rs 6.75 crore in FY’14
Geosynthetis is probably the only segment which did not pick up well, as compared to other sectors, given slower reforms and not much infrastructure activity going around.The company has sufficient capacities with latest technology to meet the increasing demand in Pune, Wai and in Silvassa.On defense side, the company is present in a very small way in the form of weather proof enclosures.The value added businesses like Aquaculture, Agriculture, Sports etc are growing very well for the company, while the traditional businesses of fishing is more or less steady.Sports, which is around 10% of net sales is growing strongly. Lot of export market opportunities await in this segment.
The prices of major raw materials, both PP and HDPE were lower on YoY basis. Company either imports them or procures from RIL or other local players. While generally the lower raw material costs is a pass through, the company is able to retain some benefits in value added products..Margins in the new business remain high. Management is confident of sustaining the margins of around 11% as reported in Q1 FY’16.
Overall, the company aims to clock turnover of about Rs 950 crore by FY’16 with Agriculture, Aquaculture and Sports being main drivers of growth with higher operating margins.