C&MD's Message
Dear Shareholders,
It gives me immense pleasure to welcome you all at the 50th Annual General Meeting of Mishra Dhatu Nigam Limited (MIDHANI).The Financial Year 2023-24 (FY 23-24) has been a year of significant growth and resilience for MIDHANI. Despite encountering significant challenges—including the need to diversify our product portfolio and navigate heightened geopolitical tensions that disrupted trade, commodity markets, and global supply chains and rising raw material prices,MIDHANI achieved a remarkable feat of ₹1,07,267.45 Lakh i.e.(₹1,072.67 Cr.) as revenue from operations which is highest ever reflecting year on year increase of 23.02%.
FY 23-24 has been a year where MIDHANI faced unprecedented circumstances and delivered excellent results which can be corroborated with MIDHANI’s increased production of Super Alloys, Titanium Alloys and Special Steel compared with last FY. MIDHANI during FY 23-24 increased its Super Alloys production by 155.16% vis-à-vis last FY; increased Titanium Alloy production by 44.15% vis-à-vis last FY; and Special Steel production was also increased by 35.93% vis-à-vis last FY. Production of Super Alloys, Titanium Alloys and Special Steel requires critical raw materials, supply of which was strained throughout the year, and prices were also unstable. All these uncertainties posed a challenge, and these challenges were meticulously faced by MIDHANI which carved a way for breaching ₹1,000 Cr. turnover mark.
During FY 23-24 MIDHANI developed various grades of high value speciality steel, Superalloys and Titanium Alloys which have its application in strategic sectors such as Defence, Space and Energy. MIDHANI’s contribution and its presence in every significant event makes it unique and versatile, which is evident by the fact that, MIDHANI supplied materials for Aditya L1 mission and supplied special quality Bronze developed for Shri Ram Janambhoomi Teerth Kshetra. To reflect on MIDHANI’s glorious past to carve out a glorious future, MIDHANI celebrated its Golden Jubilee and as part of Golden Jubilee celebrations, the statue of Dr. R.V. Tamhankar – founder Chairman of MIDHANI was unveiled. The statue was made from Titanium Alloy, one of a kind in India, by using MIDHANI’s in-house facilities of investment casting and VAR Skull Melting Furnace. The statue was a true tribute to Dr. R. V. Tamhankar – a visionary metallurgist and eminent scientist, whose vision was to see MIDHANI as ‘Super Alloy’ jewel of India.
Fostering self-reliance & diversifying global reach
FY 23-24 has been a year where MIDHANI developed several critical grades for domestic and international customers, in spite of difficulty in supply chain of critical raw materials. MIDHANI’s testament for supply of critical alloys to various strategic program is noteworthy. The new grades developed during FY 23-24 generated a revenue of ₹18,023 Lakh which showcase MIDHANI’s R&D capabilities as developing new grades involves, Research & Development, standardisation which consumes both time and extra cost for development. The constraint in raw material supply chain, inflated raw material price coupled with increased raw material consumption impacted the bottom-line performance of MIDHANI during FY 23-24. One of the important development of the year under review was that MIDHANI’s spring plant facility with a capacity of more than 60,000 springs per annum was approved by RDSO in the month of June 2024, with this MIDHANI becomes one step closer to its foray in Railway Sector. MIDHANI plans to get prototype springs approved by RDSO in FY 24-25.
On exports front, MIDHANI achieved direct export of ₹6,658 Lakh during FY 23-24 reflecting a y-o-y increase of 216.17% which was highest ever. MIDHANI’s share in overall Defence export by Indian Defence industry during FY 23-24 may seem insignificant, but for MIDHANI, exports were significant leap both strategically and for future growth perspective as MIDHANI catered the requirements of super alloys and special steel for Aerospace and Power Sector. By earmarking presence in global market and serving critical sectors, MIDHANI has opened avenues with vast possibilities. The diversified sectors served by MIDHANI ranges from oil and gas, energy, naval, Aerospace etc. It is our goal to achieve initially 10% of our total revenue from export to as high as 30% in near future, so that our global presence will be further strengthened and will be step toward MIDHANI becoming a global lead supplier of aerospace grade alloys.
Financial Highlights
During FY 2023-24, MIDHANI achieved H 1,07,267.45 Lakh i.e. (H 1,072.67 Cr.) as revenue from operations which is highest ever reflecting year on year increase of 23.02%. The Earnings Before Interest Taxes Depreciation and Amortization (EBITDA) to revenue for FY 23-24 was 20.89% translating EBITDA into H 22,408.66 Lakh vis-à-vis 33.87% translating into EBITDA H 29,258.58 Lakh for FY 22-23, a YoY decrease of 24.11% (EBITDA to Revenue). The Profit Before Tax (PBT) for FY 23-24 was H 13,095.95 Lakh vis-à-vis 21,654.92 Lakh for FY 22-23 which translates into YoY decrease of 39.52%. The Profit After Tax (PAT) for FY 23-24 was H 9,126.32 Lakh vis-à-visH 15,587.61 Lakh for FY 22-23 which translates in YoY decrease of 41.45%. MIDHANI achieved Value of Production (VoP) H 1,14,764.49 Lakh during FY 23-24 vis-à-vis H 1,10,026.63 Lakh achieved for FY 22-23 translating into YoY growth of 4.31%. During FY 23-24, reduction in EBITDA, PBT & PAT was mainly attributable to increased Raw Material costs, with led to adverse price variance of H 5,410 Lakh and increased raw material consumption due to increased production of Titanium and Super Alloys which lead to consumption variance of H 1,386 Lakh, which cumulatively resulted into H 6,796 Lakh adverse impact on bottom line. Despite gradual decrease in short term and capex loans, there was increase in finance cost due to increased lending rates.
As on April 1, 2024, MIDHANI had an order book position of ₹1,57,972 Lakh vis-à-vis ₹1,33,104 Lakh as on April 1, 2023, registering a YoY growth of 18.68%.
During FY 23-24, MIDHANI declared and paid an Interim Dividend of ₹1.41 per equity share. The Board of Directors did not declare Final Dividend for FY 23-24 considering decrease in profitability, future capex and capacity augmentation plans.
The standalone and consolidated financial results forms part of this Annual Report, Members may kindly refer the same for detailed information.
Business Responsibility and Sustainability
MIDHANI strive to uphold the principles of good governance, integrity, and transparency in its each process. MIDHANI has adopted Business Responsibility and Sustainability Reporting which forms part of this Annual Report. During FY 23-24, there has been reduction in fuel consumption, electricity consumption and air emissions which is below:
National Ambient Air Quality Standards. MIDHANI also does not withdraw, discharge water in areas of water stress. As part of MIDHANI’s initiative for improving resource efficiency and reduce impact due to emissions/effluent, several measures such as energy conservation through Automatic Power Factor Controller (APFC) & Dynamic Power Factor Controller (DPFC), usage of clean energy i.e. pure Hydrogen and clean LPG were undertaken. MIDHANI also maintains a green belt and has planted around 1,000 saplings inside plant, corporate office and townships and areas in and around MIDHANI. The Business Responsibility and Sustainability Report for FY 23-24 forms part of this Annual Report, Members may kindly refer the same.
On Corporate Social Responsibility front, MIDHANI spent ₹455.02 Lakh during FY 23-24 which covers healthcare, sanitisation, education and promotion of skill. MIDHANI also sponsors education for children belonging to SC/ST with low-income background. MIDHANI’s Primary Health Care Centre provides primary health care facilities and basic test at nominal rates which benefitted approx. 13,000 people belonging to economically vulnerable and marginalised group of society during FY 23-24.
Practicing Good Governance
We are ever committed and will always continue in our endeavour to strengthen our Corporate Governance function with clear organisational strategy, effective risk management, corporate social responsibility and transparency and information sharing with our stakeholders. Our Board and Senior Management adhere to our Code of Conduct. Our policies and procedures are continuously evaluated and upgraded to keep the organisational integrity intact and uphold values. We continue to follow, in letter and spirit, the guidelines issued by the Department of Public Enterprises (DPE). We are happy to report that, your Company scored 100% as per the revised grading norms for CPSEs, conducted by the DPE on compliance of guidelines on Corporate Governance. A Report on Corporate Governance and certificate on Corporate Governance issued by Practicing Company Secretary forms part of this Annual Report.
Way Forward:
MIDHANI has expertise in meeting diversified and critical requirements of its customers. Our performance reflects our commitment to meet the needs of our customers and emerge as the catalyst for overall growth. While we are witnessing decrease in Company’s bottom line performance due to change in revenue mix, inflated price of raw materials, strained geopolitical relations, supply chain challenges, we are highly optimistic due to the transformation of Indian Defence Industry in recent times as Defence Industry recorded highest ever production and exports. The various initiatives launched by our Government continues to provide ample opportunities to cater to the needs of the strategic sectors of our country and promote self-reliance. MIDHANI’s future projects related to capacity augmentation, efficiency of operations and standardisation of newly developed grades will be fruitful in near future, and we hope that same would reflect positively on our Financial Results.
I would like to thank our customers and supplier vendors for their constant support and belief in our capabilities. I would like to thank my colleagues on the Board for their valuable guidance. A dedicated and talented manpower is MIDHANI’s indispensable strength, I would to like to thank each and every employee of our Company for their efforts and dedication. I also like to place on record the support from our Administrative Ministry and Government agencies.
I am confident that, MIDHANI will continue to scale greater heights and deliver value to all stakeholders under the stewardship of its astute management.
Thank You
Jai Hind !
Dr. Sanjay Kumar Jha
Chairman & Managing Director
MISHRA DHATU NIGAM LIMITED
(A Govt. of India Enterprise, Ministry of Defence)
Registered Office : P.O. Kanchanbagh, Hyderabad -500058
Tel. No: 040-2418 4515, Fax No: 040-2956 8502
Website: www.midhani-india.in