Future Positive
Ashwin Muthiah
Founder & Chairman of AM International Holdings, Singapore and AM UK Holdings, London
Dear Stakeholders,
As we know, 2020 was a year of unprecedented change. The COVID-19 pandemic highlighted business continuity and health safety as key business imperatives. It disrupted the world around us, altered our perception of challenges and transformed our approach to addressing them.?
As I write my annual note, the world continues to deal with the pandemic’s spiralling effect. My thoughts remain with the communities and individuals, including healthcare workers and frontline responders, who continue to serve selflessly. My sincere condolences to the families who’ve lost their loved ones to this global crisis.
As hard as it is, I believe that adversity is a test of character. The past year’s extraordinary circumstances are among the many unprecedented challenges that the AM International Group has weathered in its six-decade history. As a first-hand witness to many of those events, I can vouch that each experience made us stronger. It is moments like these that demonstrate our resilience. It is times like these that make us resolute about our goals, the future we want to build and the legacy we want to leave behind.
As a group, each incident strengthened our resistance as we worked with more determination towards a buoyant post-crisis recovery. As a result, our group companies have persistently retained their market leadership in various business segments.
Navigating the COVID-19 crisis
While we cannot predict crises or the way they unfold, we have identified critical measures that help us cope effectively. Preparedness plays a vital role in this context. At AM International, our resilience during the pandemic was a culmination of years of foresight, proactive planning and diligence. Over the last decade, teams across our group companies have identified and implemented critical measures that helped us cope effectively and lead our organisations and communities to positive outcomes even in these challenging times.
‘Trust’ has been the most valued currency for every business at AM International. Our businesses are trusted by stakeholders and communities across eight countries. Regardless of the challenge, be it driving cost efficiencies, entering new markets or navigating a pandemic, trust is the bedrock that helps us make the right choices. Our processes, people and conduct are designed to build trust across the ecosystem.
We have been following an optimal leverage strategy for the past few years. Due to such prudent financial practices, our companies have built substantial cash reserves. These were utilised effectively during the crisis. The value created over the years helped us sustain our operations. As the promoter and a business leader, having skin in the game was the key.
Many of our companies that operate in India are a part of essential services industries. Our actions underpinned our commitment to provide continuous support to customers and communities in the most critical times. We effectively leveraged the power of digitalisation and tailored our operations at every step to meet the pandemic’s evolving challenges.
This is key to maintaining relevance and profitability in a rapidly changing situation. However, we firmly believe that growth decisions that diverge from the core business can hamper the long-term vision. Hence, we assess every opportunity in the context of our core capabilities. Further, companies across the AM International group have consciously integrated agility, fair play and nimbleness in their operations.
Across our group companies, employee well-being and safety have been a non-negotiable priority since the beginning of the pandemic. While the uncertainty did impact our operations, our 3,000+ team spread across three continents remained united and steadfast.
The Board of Directors and senior management across companies demonstrated exceptional leadership under the most difficult circumstances. Going beyond our immediate ecosystem, we focused on building stronger communities by helping the most vulnerable during the past year.
These strategies enabled us to shape a dependable, responsible and agile response. In the milieu of uncertainty, it ensured minimum disruptions across levels. I believe that these actions will continue to enhance value for our businesses and shareholders in the time to come. Our focus remains on navigating these times without compromising our credibility, reputation and financial well-being.
2020: A year of new beginnings
Despite the challenges presented by the pandemic, 2020 marked many new beginnings for companies across the AM International group. It has been a time to reflect, reimagine and reorient ourselves for the future. Here is how I envisage the new decade for our group:
Customer centricity is key to the success of our group companies. In 2020, we initiated multiple prestigious projects which will be at the centre of our customer partnerships in the years to come:?
o Agriculture will play a crucial role in India's economic resurgence in the post-COVID-19 world. To cater to the growing demand for agri-nutrients and chemical fertilisers, Southern Petrochemical Industries Corporation Ltd. (SPIC) inaugurated the model fertiliser retail shop (MFRS), a first by a private company in Kerala, India. Further, SPIC plans to expand the capacity of its fertiliser plants in the years to come.
o Early in the year, EDAC Engineering Ltd. successfully completed the erection of the first column of Boiler #2 at the Godda Ultra Supercritical Thermal Power Project in Jharkhand, India.
o Tamilnadu Petroproducts Ltd. (TPL) will embark on an expansion-cum-modernisation programme. Under the proposed expansion, TPL will undertake a capacity augmentation of its linear alkyl benzene (LAB) division, upgrade its caustic soda facilities and set up a propylene recovery unit (PRU). The project will lead to significant cost savings and revenues.
o The Boat Building division of Sicagen India Ltd. collaborated with the Department of Fisheries, Government of Tamil Nadu, India to convert trawler boats into deep-sea fishing.
One of our most important commitments is to integrate greater sustainability across our operations. During the last year, we undertook several initiatives in this direction:
o SPIC is one of the anchor customers of Indian Oil Corporation Limited’s Ramanathapuram-Tuticorin gas pipeline project in Tamil Nadu, India. The pipeline’s last-mile connectivity will enable SPIC to completely switch from naphtha to natural gas as a feedstock to produce urea.
o Manali Petrochemicals Ltd. (MPL) switched to 100% recycled water in its manufacturing plants. With the upgrade of the water supply infrastructure complete, MPL deploys only treated tertiary sewage water across its manufacturing value chain.
o TPL switched from traditional furnace oil to Liquified Natural Gas (LNG) in process heaters across its plants. It has helped TPL achieve significant eco-efficiencies such as decrease in annual fuel usage, reduction in steam consumption and diminished emission footprint.
The ability to fine-tune a business strategy to harness new demand while protecting current revenue streams is the key to creating long-term value. In 2020, our group companies undertook important measures towards this objective:
o Across the AM International group, ensuring a robust digital infrastructure for business continuity and risk management is a key priority. With 10 businesses across 8 countries, we recognise that our operations, especially manufacturing plants, need to run uninterrupted to retain a competitive edge.
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o MPL obtained the Board’s approval to expand its capacity of Propylene Glycol (PG) from 22,000 TPA to 70,000 TPA. MPL is the only domestic manufacturer of PG in India. It is widely used in pharmaceutical/Food & Flavours and for industrial applications.
o TPL expanded the installed capacity of Normal Paraffin from 70,000 MTPA to 94,000 MTPA. It is one of the raw materials used in LAB production. This reduces TPL’s dependence on imports, de-risks operations and leads to cost savings.
Across our group companies, we have the honour of working with remarkable global organisations. Recognition for our work encourages us to pursue our objectives with greater enthusiasm.
o Tuticorin Alkali Chemicals and Fertilizers Ltd. (TFL) is the first and only company to install a carbon capture unit for the manufacture of soda ash. The pioneering process can help to capture and process 60,000 MT of CO2. TFL leveraged this technology as a part of its partnership with Unilever. These efforts helped the company win the coveted ‘Partner of the Year’ award from Unilever.
o SPIC was honoured at the prestigious VO Chidambaranar (VOC) Port Traffic Performance Awards for Port Users for ‘Excellence in Traffic Performance for 2019-20’ and ‘Excellence as Business Support Partner’. The awards uphold the five-decade relationship that SPIC shares with the VOC Port Trust.
Our businesses will align to new opportunities in the post-COVID-19 world to stay relevant and competitive. Infrastructure, talent and technology will be the critical elements for organisations to win in the next decade.
o Reforms such as the 'one India, one farm market' ordinances and the agri-infrastructure fund are a shot-in-the-arm for the sector. We are strengthening our Fertilisers and Supply Chain business to meet the increased demand we foresee. With our sustained focus on bulk cargo shipping, augmenting the strength of our fleet seems opportune at this juncture.
o Our Petrochemicals and Medtech verticals are primed to serve new demand from the pharma and food sectors. We are future-ready by marrying scale with sustainable manufacturing practices and indigenous R&D that brings affordable technology to consumers.
o We will continue to strengthen our green solutions portfolio and deploy more resources to pursue responsible innovation for a greener tomorrow.?
o Our group companies are creating a pipeline of gen-next leaders through training programmes that focus on continuous learning and ensure that our talent is upskilled and re-skilled.
Since the beginning of the pandemic, we've been supporting the most affected communities. This has enabled us to contribute to relief measures through various CSR activities. The efforts are helmed under the group’s CSR arm, AM Foundation, which focuses on improving public healthcare.
o SPIC supported the local authorities with COVID-19-related essentials. It provided basic provisions to the most vulnerable communities around its plant sites. SPIC also contributed to the house construction of trans-families in Thoothukudi, Tamil Nadu, India.
o MPL organised food provisions for persons with disabilities in need to ensure they had enough supplies during the lockdown period.?
o Apart from COVID-19 relief, we also undertook initiatives for community betterment:
Future positive
Going ahead, I see three clear trends to ensure business continuity:
Technology will percolate every aspect of an organization’s operations. Going forward, meetings will witness a combination of physical and virtual attendance – the need for physical meetings cannot be totally ignored. At AM International, we recognise that a learning mindset is crucial to performance in the new normal.
Companies will focus on localisation within regions rather than globalisation. Local-level competency, logistics and supplier ecosystem will be critical for continued production. At AM International, we are will look for global innovations and technologies that will support and strengthen the operations of our India-based companies. Regular modernisation alongside compliance, capacity-expansion in our current manufacturing plants and green-production practices will be a key focus.
At AM International, we have used the pandemic as an opportunity to change our priorities and make them healthier and more balanced – physically, mentally and socially.
COVID-19 has taught us how to handle ambiguity. It’s a lesson that we retain to ensure that our future operations marry continuity, sustainability and goodness to create trusted businesses.
As I end this letter, I thank our employees for their relentless efforts during these unprecedented times. I would also like to express my gratitude to our stakeholders, customers and partners for their unstinted support and enduring trust in our competencies even amid the most challenging circumstances.
I wish each one of you and your families a safe, healthy and prosperous future.
Thank you,
Ashwin Muthiah
Founder & Chairman
AM International Holdings Pte. Ltd.
<Excerpts from the Annual Report>
CMO
2 年Commitment towards growth always..
WTD, SPIC Limited
2 年Excellent compilation of the achievements to recapture all the deliverables done in the pandemic year. We will continue to provide our support and push the organization to the greater heights. We will do sir.
Management consultant, District in charge (Prime minister's Welfare association), secretary (chennai)(International Human rights Association), Engineerig Missionery.
2 年Spic towards Transformation.Nice to hear the growth.