About
Meghmani Organics Ltd
The Company was incorporated on 15 October 2019. Pursuant to the Composite Scheme of Arrangement, approved by Hon'ble NCLT Ahmedabad Bench, vide an Order dated May 3, 2021, the Agrochemical and Pigment business operated by Meghmani Organics Limited has been demerged into Meghmani Organochem Limited. As an integral part of the Scheme, name of the Company has been changed from Meghmani Organochem Limited to 'Meghmani Organics Limited' vide Certificate of Incorporation pursuant to change of name issued by the Registrar of Companies, Gujarat on 3rd August, 2021. The Company is engaged in manufacturing and selling of pigment and agrochemicals products.
The Company is a leading diversified chemical company with significant presence worldwide. Its strong customer base includes prominent MNC's, and geographical reach extends to more than 75 countries globally. The Company manufacture three broad categories of Agrochemical products, namely, pesticide intermediates, technical and formulations. The agrochemical products find primary application in Crop Protection, Veterinary, Public Health and Wood Protection. Within Pigments, it specializes in green and blue pigments, which have varied user application in printing inks, paints and coatings and plastics.
The Company operates 6 facilities in Gujarat, 3 major facilities for Pigments and Agro Chemicals each. The Company continues to become one of the leading diversified chemical companies in Organic Chemistry aiming for worldwide presence and product acceptability. The Company has set up world class development centre to facilitate upgrading technical capabilities and cost-effective measures.
The Company has a sustainable business model, well-integrated manufacturing base and plants located in the chemical hub of Gujarat, a relatively most stable and peaceful state with a robust infrastructure. The Company has well-balanced plant capacities and layouts with multiple locations that support the economy of scale. It constantly explores more possibilities for backward integration and try to implement them. This helps sizable in eliminating the dependency on input supplies and the Company can convert effluents into valuable by-products. The Company has a strong pool of product basket. The product reach and distribution too, are well diversified geographically with a presence in almost every continent, empowering consistency in products off-take all throughout the year.
The Company manufacture a wide range of pigments and agrochemicals in India and have a focus on delivering differentiated and quality products backed by strong research and development capabilities. The Company have three Pigment manufacturing plants at Vatva, Panoli and Dahej SEZ in the State of Gujarat. It has a strong global presence in more than 75 countries and serve to end-user industries mainly in the areas of printing inks; paints & coatings; and plastics.
The Company have 6 multifunctional ISO 9001 and 14001 certified production facilities with a wide range of products and backward integration of key raw materials, located in Gujarat, India's prime Chemical belt and having proximity to key ports. With a highly integrated manufacturing infrastructure, the Company is producing own intermediates and a wide range of crop protection products.
In 1986, the Company was founded as a Partnership Firm under the name of 'M/s Gujarat Industries' to manufacture Green 7 pigment plant at Vatva.
In 1995, the Company established agrochemicals manufacturing plant at Chharodi.
In 1996, the Company established pigment manufacturing plant at Panoli.
In 2003, the Company acquired agrochemicals plant at Gujarat Industrial Development Corporation (GIDC), Ankleshwar.
In 2004, the Company listed Equity Shares on Singapore Exchange (SGX) through depository.
In 2007, the Equity Shares of Company was listed on the NSE and BSE platform.
In 2008, the Company incorporated Meghmani Finechem Limited (MFL) to set up caustic chlorine plant at Dahej.
In 2009, the Company acquired agrochemical formulation plant at GIDC, Panoli. The Company set up agrochemical manufacturing facilities at GIDC, Dahej.
In 2013, the Company established pigment manufacturing facilities at Dahej SEZ Limited.
In 2017, the Company was accredited for Good Laboratory Practice (GLP) and Norms on OECD Principles' by National Good Laboratory Practice (GLP) Compliance Monitoring Authority (NGCMA) India and research labs for the tests conducted by DSIR (Department of Science and Industrial Research) approved lab and R&D facility for expansion of technology from laboratory to production level.
In 2020, the Company increased expansion in agro division by doubling the capacity of 2, 4D herbicides to 21600 TPA and new formulation plant. The Company set up a new multipurpose plant at Dahej with a capex of Rs. 31,000 lakhs.
In 2021, Meghmani Finechem Limited (MFL) stood transferred as a Demerged Company and independent listing was made for Shareholders. The Company commissioned two expansion projects in Agro division with capex of Rs.15,000 lakhs in FY 2021.
The Hon'ble National Company Law Tribunal (NCLT), Ahmedabad Bench vide its Order dated 3 May 2021, has approved the Composite Scheme of Arrangement to demerge the Agrochemicals and Pigments Division of Demerged Company and transferred the same to Meghmani Organochem Limited (MOL) as a going concern. The Scheme has been made effective from 10th May, 2021.
Pursuant to the Order of NCLT dated 03 May, 2021 the four Subsidiaries of erstwhile Meghmani Organics Limited, namely, Meghmani Organics USA INC. (USA), P.T. Meghmani Organics (Indonesia), Meghmani Overseas FZE - Sharjah - Dubai and Meghmani Synthesis Limited stood transferred and became the Subsidiary of Company.
Pursuant to approval of Composite Scheme of Arrangement approved by National Company Law Tribunal, Ahmedabad Bench vide Order dated 3rd May, 2021, the Company has allotted 25,43,14,211 Equity Shares of Re. 1/ each on 20th May, 2021 to Shareholders of the Demerged Company on 19th May, 2021.
Meghmani Organics Ltd
Chairman Speech
Dear Shareholders,
It gives me immense pleasure to present the annual report of Meghmani Organics for the
year FY23. Ranked as #1 Fortune Next 500 Company by Fortune India, we are striking a
perfect balance between meeting our business objectives along with being good stewards of
environment and sustainability. We prioritize meeting the demands of our customers,
prospects and stakeholders and building an ecofriendly brand for our business.
Macro overview
This year has been a challenging year for the Indian chemical industry, which has been
impacted by a multitude of global macroeconomic factors. These include geopolitical
concerns, inflationary pressures, volatile raw material prices, and contraction in demand.
Despite these headwinds, I am delighted to say that Meghmani Organics has weathered the
storm and continued to deliver robust performance. We have maintained our focus on
operational efficiency, diversifying product portfolio and quality products, which has
helped us navigate these turbulent times.
The subdued environment is expected to continue in the upcoming quarter, but we are
optimistic about the future. We are already seeing decline in raw material prices and
logistic costs, which will have a positive impact on our production and operation going
forward in the upcoming quarters.
It is important to note that the entire industry is facing a pile-up of high-cost
inventory due to oversupply situations in the marketplace. This has put pressure on the
revenue as well as margin across chemical companies. However, we believe that the
situation will improve going forward, and we remain committed to our long-term growth
strategy.
Sustainable growth
In FY23, our revenue increased by 2.5% to Rs.2557 crores, and our EBITDA reached Rs.364
crores with a margin of 14.2%. The pigment segment had a negative impact on the margin,
but this was partially offset by the agrochemicals division. Our focus is on improving
margins across all business segments.
Our net profit for the year was Rs.250 crores, demonstrating the strength of our
business model. As of March 31st, 2023, our cash balance & short term investments on
the balance sheet amounted to Rs.59 crores. Despite ongoing capital expenditure (CAPEX),
we have consistently maintained a debt to equity ratio below 0.5, which is satisfying.
Our return ratios, specifically ROCE and ROE, were approximately 13% and 16%,
respectively, for the year. These ratios underscore our strong operational performance and
efficient capital utilization.
We prioritize continuous improvement in our operations to ensure sustainability.
By aligning our product offerings with market demand, we have achieved positive
outcomes, establishing ourselves as a reliable supplier for our clients. We adapt our
strategy based on demand, pursuing backward integration.
Segment-wise overview
Our agrochemicals business constitutes approximately 76% of the revenue and we remain
as one of the leading AgroChemical manufactures with strong presence in India and export
market. We are able to derive value from this segment through our constant endeavour to
deliver a better product.
With investment in research and development, we have come up with newer molecules while
also focussing on process development which allows us to enhance our technical capacities
and adopt cost effective processes.
Whereas, our pigments division contributed 24% of our revenue, we see there is a
contraction in the growth of the pigment industry. This slowdown can be attributed to
muted export demand and contracted prices. I would like to highlight that this year, we
have commissioned Phase I of our Titanium Dioxide (TiO2) plant with an installed capacity
of 16,500 metric tons per annum and the plant is under stabilization.
Capacity building to drive through sustainability
We remain focussed on enhancing our capabilities and capacity eyeing on timely
execution. We have a strong balance sheet with an ability to generate free cash flow which
can be used to fuel our capex plans with robust working capital management backed by
internal accruals.
With a focus on capacity and capability building, we have commissioned a MultiPurpose
Plant (MPP) with backward integration. This makes us well-positioned to benefit from
"China plus one" strategy of global players coupled with enhanced capacity
eyeing on new molecules in agrochemicals.
We are accredited with Responsible Care certification by Indian Chemical Council, apex
industry body representing chemical industry in India pursuing "Responsible Care
Programme".
Good and transparent business practices
We continue to demonstrate good and transparent business practices.
We constantly endeavour to create sustainable position as one of the leading and
diversified chemical companies with strong manufacturing base in "Organic
Chemistry" aiming global presence with worldwide product acceptability.
Opportunities
Indian agriculture sector is a major consumer of agrochemicals, with increasing demand
expected due to a focus on enhancing crop yields and improving produce quality. The
country's large production and export of agrochemicals also presents significant
opportunities for companies.
We have entered into a licensing agreement with one of leading domestic fertiliser
manufacturer through MCNL a wholly owned subsidiary for producing Nano Urea (Liquid)
Fertilizer by using their domestically developed patented Technology and setting up plant
in Gujarat with a capex of Rs.150 crore with annual capacity of 5 crore bottles (~500 ml)
per year. The Plant is expected to commence the commercial production by Q4 FY24 and
achieve a top line of ~H 1,000 crores on an annual basis. Foray into Crop nutrition
segment thourgh Liquid Fertilizers amplifies the growth strategy of the company and also
aligned with the Prime Minister's vision of Atmanirbhar Bharat and increasing farmers'
income.
India's growing paint and coatings industry, particularly the decorative, industrial,
and automotive coatings segments, is expected to drive growth in the pigments market.
Titanium oxide (TiO2) consumption is also significant in Indian manufacturing, with demand
expected to remain strong due to increasing demand from end-use industries and government
initiatives to promote manufacturing and infrastructure spending.
Our people
At Meghmani Organics, our people are at the heart of our success. Our diverse and
talented workforce are committed to delivering high-quality products and services to our
customers. We recognise the importance of inclusivity and wellbeing of our employees in
our long-term success. We are dedicated to provide them with a safe and healthy work
environment, as well as opportunities for growth and development.
We continue to unleash the full potential of our employees and ensure that their
contributions are recognised and rewarded. We believe that by putting our people first, we
can achieve our goals and build a sustainable future for our business.
Outlook
Looking ahead, our focus is on building a sustainable future for our company, our
stakeholders, and the planet. We believe that sustainability is the key to long-term
success and we are committed to integrating it into every aspect of our operations.
To achieve this, we will continue to invest in research and development to create
innovative and eco-friendly products.
We will also focus on enhancing our operational efficiency and reducing our carbon
footprint by adopting best practices and implementing energy- efficient technologies.
We understand the importance of good governance and we will continue to uphold the
highest standards of ethical conduct, transparency, and accountability in all our
dealings.
We are confident that with strong focus on sustainability, innovation, and good
governance, Meghmani Organics Limited is well-positioned to achieve sustainable growth and
create long-term value for all our stakeholders.
Vote of thanks
I would like to take this opportunity to extend my heartiest gratitude to all our
stakeholders for their encouragement and faith in Meghmani Organics. I am extremely
thankful to all our partners, suppliers, customers and business associates for their
constant support over the years, we look forward to another successful and sustainable
year ahead.
Regards
Jayanti Patel
Executive Chairman.
Meghmani Organics Ltd
Company History
The Company was incorporated on 15 October 2019. Pursuant to the Composite Scheme of Arrangement, approved by Hon'ble NCLT Ahmedabad Bench, vide an Order dated May 3, 2021, the Agrochemical and Pigment business operated by Meghmani Organics Limited has been demerged into Meghmani Organochem Limited. As an integral part of the Scheme, name of the Company has been changed from Meghmani Organochem Limited to 'Meghmani Organics Limited' vide Certificate of Incorporation pursuant to change of name issued by the Registrar of Companies, Gujarat on 3rd August, 2021. The Company is engaged in manufacturing and selling of pigment and agrochemicals products.
The Company is a leading diversified chemical company with significant presence worldwide. Its strong customer base includes prominent MNC's, and geographical reach extends to more than 75 countries globally. The Company manufacture three broad categories of Agrochemical products, namely, pesticide intermediates, technical and formulations. The agrochemical products find primary application in Crop Protection, Veterinary, Public Health and Wood Protection. Within Pigments, it specializes in green and blue pigments, which have varied user application in printing inks, paints and coatings and plastics.
The Company operates 6 facilities in Gujarat, 3 major facilities for Pigments and Agro Chemicals each. The Company continues to become one of the leading diversified chemical companies in Organic Chemistry aiming for worldwide presence and product acceptability. The Company has set up world class development centre to facilitate upgrading technical capabilities and cost-effective measures.
The Company has a sustainable business model, well-integrated manufacturing base and plants located in the chemical hub of Gujarat, a relatively most stable and peaceful state with a robust infrastructure. The Company has well-balanced plant capacities and layouts with multiple locations that support the economy of scale. It constantly explores more possibilities for backward integration and try to implement them. This helps sizable in eliminating the dependency on input supplies and the Company can convert effluents into valuable by-products. The Company has a strong pool of product basket. The product reach and distribution too, are well diversified geographically with a presence in almost every continent, empowering consistency in products off-take all throughout the year.
The Company manufacture a wide range of pigments and agrochemicals in India and have a focus on delivering differentiated and quality products backed by strong research and development capabilities. The Company have three Pigment manufacturing plants at Vatva, Panoli and Dahej SEZ in the State of Gujarat. It has a strong global presence in more than 75 countries and serve to end-user industries mainly in the areas of printing inks; paints & coatings; and plastics.
The Company have 6 multifunctional ISO 9001 and 14001 certified production facilities with a wide range of products and backward integration of key raw materials, located in Gujarat, India's prime Chemical belt and having proximity to key ports. With a highly integrated manufacturing infrastructure, the Company is producing own intermediates and a wide range of crop protection products.
In 1986, the Company was founded as a Partnership Firm under the name of 'M/s Gujarat Industries' to manufacture Green 7 pigment plant at Vatva.
In 1995, the Company established agrochemicals manufacturing plant at Chharodi.
In 1996, the Company established pigment manufacturing plant at Panoli.
In 2003, the Company acquired agrochemicals plant at Gujarat Industrial Development Corporation (GIDC), Ankleshwar.
In 2004, the Company listed Equity Shares on Singapore Exchange (SGX) through depository.
In 2007, the Equity Shares of Company was listed on the NSE and BSE platform.
In 2008, the Company incorporated Meghmani Finechem Limited (MFL) to set up caustic chlorine plant at Dahej.
In 2009, the Company acquired agrochemical formulation plant at GIDC, Panoli. The Company set up agrochemical manufacturing facilities at GIDC, Dahej.
In 2013, the Company established pigment manufacturing facilities at Dahej SEZ Limited.
In 2017, the Company was accredited for Good Laboratory Practice (GLP) and Norms on OECD Principles' by National Good Laboratory Practice (GLP) Compliance Monitoring Authority (NGCMA) India and research labs for the tests conducted by DSIR (Department of Science and Industrial Research) approved lab and R&D facility for expansion of technology from laboratory to production level.
In 2020, the Company increased expansion in agro division by doubling the capacity of 2, 4D herbicides to 21600 TPA and new formulation plant. The Company set up a new multipurpose plant at Dahej with a capex of Rs. 31,000 lakhs.
In 2021, Meghmani Finechem Limited (MFL) stood transferred as a Demerged Company and independent listing was made for Shareholders. The Company commissioned two expansion projects in Agro division with capex of Rs.15,000 lakhs in FY 2021.
The Hon'ble National Company Law Tribunal (NCLT), Ahmedabad Bench vide its Order dated 3 May 2021, has approved the Composite Scheme of Arrangement to demerge the Agrochemicals and Pigments Division of Demerged Company and transferred the same to Meghmani Organochem Limited (MOL) as a going concern. The Scheme has been made effective from 10th May, 2021.
Pursuant to the Order of NCLT dated 03 May, 2021 the four Subsidiaries of erstwhile Meghmani Organics Limited, namely, Meghmani Organics USA INC. (USA), P.T. Meghmani Organics (Indonesia), Meghmani Overseas FZE - Sharjah - Dubai and Meghmani Synthesis Limited stood transferred and became the Subsidiary of Company.
Pursuant to approval of Composite Scheme of Arrangement approved by National Company Law Tribunal, Ahmedabad Bench vide Order dated 3rd May, 2021, the Company has allotted 25,43,14,211 Equity Shares of Re. 1/ each on 20th May, 2021 to Shareholders of the Demerged Company on 19th May, 2021.