MADRAS FERTILIZERS LIMITED
MANALI, CHENNAI 600068
53rd Annual General Meeting
19th September 2019
SHRI U SARAVANAN
CHAIRMAN & MANAGING DIRECTOR
Dear esteemed Shareholders,
Brothers & Sisters,
Very Good Morning to all of you!
It gives me immense pleasure in welcoming you all to the 53rd Annual General Meeting of the Company. On behalf of Board of Directors of MFL, I thank each one of you for joining us. This is my second speech after assuming the Office of Chairman.
I take this opportunity to brief you about the Company’s performance. The Annual Report for the year ended 31st March, 2019 along with the AGM Notice, Directors’ Report and the Audited Annual Accounts of the Company, have already been circulated to you and I request your permission to take them as read. Before I could touch upon the performance of the Company, I would like to briefly narrate the Indian Fertilizer scenario during the year 2018-19.
Indian Fertilizer Sector at a glance
Fertilizers play an important role in the global agricultural economy. Indian Fertilizer Industry has witnessed a sharp growth since the era of green revolution. It has emerged gracefully in the last 50 years and succeeded in meeting the demand of nearly all chemical fertilizers over the years and now become an important segment of Indian economy.
The Government’s ambitious goal of doubling farmer income by 2022 continues to be a major enabler of farm productivity and farmer prosperity. Several progressive policy measures undertaken by the Government like bringing additional area under irrigation coverage, promoting micro irrigation &precision farming, direct benefit transfer of subsidies etc. are all set to positively change the dynamics of India’s agriculture industry.
On the Policy front, the Government has launched Phase-II of the Direct Benefi t Transfer of Fertilizer Subsidy (DBT 2.0) in July, 2019 for bringing transparency in administration and a positive change in lives of the people. DBT in fertilizer subsidy is such a step in the direction of bringing ease of living in the lives of farmers through use of modern technology and plugging leakages,pilferages and black marketing. By implementation of second phase of DBT, the system would become more transparent and the penetration of fertilizer subsidy would further be increased in the country.
In order to facilitate accurate information gathering and decision-making w.r.t. the position of requirement/supply/availability of various fertilizers at National, State and District levels, the DoF has developed various dashboards. These dashboards provide various reports regarding the Fertilizer Stock position at ports, plants, in States, at District levels; Proportionate requirement for the season and availability of stocks at various levels; top 20 buyers; frequent buyers; Retailers not selling fertilizers, etc. The reports would facilitate real-time monitoring of the availability and sale of fertilizers within each State/Union Territory. Public can access the dashboards by clicking the e-urvarak website of DoF (www.urvarak.nic.in).
Keeping in view the various operational challenges viz. limited PoS vendors, rush of sales due to peak season etc, the Government has developed a multilingual desktop version of PoS software as an alternative or added facility to PoS devices. The Desktop software is more robust and secure as the application is developed and handled directly from the central HQ team at DoF. Further, 2.24 Lakh PoS devices have been deployed across all States. 670.99 Lakh Metric tonnes Fertilizers have been sold through PoS devices till June 2019.
Performance Highlights of the Company
Coming to the Company’s financial performance,your Company’s operations ended up with a loss of ₹ 83.24 Cr during Fiscal 2018-19 due to incurrence of huge interest cost and due to stoppage of production for first two quarters owing to working capital crisis.
During the year 2018-19, 45 Kgs Neem Coated Urea bagging was started on May 24, 2018. During 3rd & 4th quarter the Company made a profit of ₹ 7.73 Cr and ₹ 3.00 Cr respectively. Urea Plant Production of above 100% load (1475 MT) was achieved for more than 174 Days during this year. Advance Process Control (APC) commissioned in Ammonia Plant during Nov. 2018 and expected to get the profit of ₹ 7.30 Cr annually. APC installed in Urea Plant fetching us ₹ 4.14 Cr annually.
At the close of Mar 31, 2019, 1815 days were completed without any lost time accident covering 6.594 million man-hours (Previous best achieved –5.66 million man-hours).
During the year 2018-19, On the marketing front, I am proud to state that your Company has allowed rebates of ₹ 36.54 lakhs as against CPLY of ₹ 12.15 Crores, thereby saved ₹ 11.79 Crores.
Your Company has achieved Vijay Neem Coated urea Sales of 4,19,766.18 MT which is 8.23% of total consumption in MFL’s marketing territory. Available quantity of 27,429.55 MT of Vijay 17-17-17 was sold. A sale of 76.53 KL of Vijay Neem, which is 27% increase over last year sale of 60.12 KL was achieved. A sale of 150 MT of Vijay Bio Fertilizers, which is 81% increase over last year sale of 83 MT was achieved. Sold 905 MT of Vijay Organic compared to last year sale of 1684 MT.
As part of “Swachh Bharat Mission”, Marketing of City Compost, a product from Municipality / Factory waste has been undertaken and 8087 MT sold, which is 15.6% share in the MFL marketing territory. MFL stood 8th position in terms of City Compost sale in All India Level and 3rd position in South India.
In pursuance to the Prime Minister’s mission on empowering the farmers vide Supportive Schemes & Education on farming techniques, your Company has established “Kisan Suvidha Kendra” at Gangavathy and Shimoga in Karnataka during the year. Apart from selling agricultural inputs, farmer services like soil sample analysis and recommendation of fertilizer dosage based on soil test report, educating the farmers on weather, crop insurance and other improved farm technologies were offered.
I am pleased to inform you that your Company Accounts were audited by the Comptroller and Auditor General of India, who have certified them with `NIL’ comments for the fourteenth consecutive year. This is a significant achievement to prove our clear adherence to the statutes strictly in true letter and spirits.
Feed Stock Conversion
Your Company has converted its Feed Stock from Naptha to RLNG fully from 28.07.2019. Now MFL is producing Ammonia with RLNG, a low cost and clean fuel.
Corporate Social Responsibility (CSR)
Your Company is concerned about Corporate Social Responsibility (CSR) for the upliftment of farmers and society. Your company has spent a sum of ₹ 50,000/- for distribution of artificial limbs to the physically challenged persons. A sum of ₹ 1,36,000/- was spent in organizing Farmers Seminar in coordination with Coconut Development Board in Pollachi, Coimbatore District for creating awareness about Govt.of India crop Insurance Scheme and e-NAM (National Agriculture Marketing Online Trading Platform). A sum of ₹ 5,44,000/- was spent for supplying wholesome drinking water through pipeline to the neighbouring village, Harikrishnapuram in Manali. A sum of ₹ 1,50,000/- was spent for Gaja Cyclone Relief in Thiruvottiyur. A sum of ₹ 2,00,000/- was spent for distribution of Students aid materials in primary schools in Manali towards CSR activities during the year 2018-19.
Dear Shareholders, the Company has submitted a Revival Proposal to Government of India through Department of Fertilizers, for its consideration.
I would like to take this opportunity to thank the stakeholders, Central and State Governments,regulatory authorities, investors, banks and financial institutions and look forward to their continued support in the Company’s future endeavours. I thank all the Board members for helping me in creating good governance culture across the organization and fulfilling the responsibilities of the Board. I would like to place on record the sincerity,hard work,commitment and dedication of the employees.
It will certainly be our endeavor to put in our best efforts for sustained growth, expansion and prosperity of the Company benefitting all stakeholders.
Thank you and Jai Hind!
Chairman & Managing Director