Amal Ltd | Annual Report 2022-23 Letter to the shareholders Fellow shareholders, Our Company had a peak carried forward loss of ` 56 cr till 2007-08 – it was able to wipe out the last remaining loss of ` 0.29 cr in 2021-22. We were therefore hopeful that our Companywill be able to recommend a dividend in 2022-23 however, this was not to be; on the contrary, it incurred a loss at consolidated level of ` 16 cr because of the following two main reasons. One, on the one hand, the price of Sulphur remained high and on the other, the demand and consequently the prices of f inished products remained low. In 2022-23, the standalone sales of our Company at ` 39 cr came down from ` 43 cr and standalone PBT at ` 1.37 cr came down from ` 3.32 cr (which itself was much lower than the peak of ` 12.69 cr achieved in 2019-20). Two, Amal Speciality Chemicals, the only whollyowned subsidiary of our Company, commissioned a plant to manufacture 300 tpd equivalent Sulphuric acid products during Q2. It took us 12 months to overcome the problems related to technology and supply of steam. We were therefore unable to run the plant fully, and the subsidiary incurred a loss of ` 17 cr. The CapEx also went up from the earlier envisaged ` 71 cr to ` 96 cr mainly because of the increase in the price of steel | few modifications. In light of the above, we considered it prudent to increase the equity of our Company to better the debt equity ratio – after the rights issue of ` 49.94 cr, the debt has decreased by ` 36 cr. The promoter shareholding is up by four percentage points to 71%. During 2022-23, we debottlenecked the capacity of Sulphur dioxide, a key product, from 17 tpd to 28 tpd. Furthermore, we strengthened the management team and in all added (including for the new plant of Amal Speciality Chemicals) 15 team members. At full capacity, on a 12-month basis, our Company has the potential to deliver consolidated sales of ` 99 cr. For the first quarter of 2023-24, consolidated sales of our Company were at ` 17 cr (against sales of ` 11 cr in the same period of 2022-23) – sales were lower because of the annual shut down and also shut down because of somemodifications. Consolidated loss was ` 3 cr (against loss of ` 2 cr in the same period of 2022-23). Despite this, we expect our Company to do better in 2023-24. Our first priority is to run both the plants, one of our Company and the other of Amal Speciality Chemicals, most efficiently and productively and achieve high capacity utilisation. It will be our endeavour to repay the remaining debt at the earliest and become financially more resilient. We value the hard work and perseverance of every member of team Amal. We thank the customers for their business. We are grateful to the Independent Directors for their guidance and value addition. Within the coming 12 months, Mr Abhay Jadeja, Mr Sujal Shah and Ms Mahalakshmi Subramanian will step down as they complete their tenure. The Board will appoint new Independent Directors during 2023-24. Indeed, there was an adverse impact on the financials of our Company in 2022-23 and in the first quarter of 2023-24 mainly because of our own operating problems and to some extent lower demand. We are not only facing and overcoming the problems, but also articulating a project to emerge stronger. In all this, we thank you for your unstinted support. Sincerely, (Rajeev Kumar) (Sunil Lalbhai) Managing Director Chairman
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