It is my privilege to share with you my views on the performance of our company during the last financial year and some of the key developments in the economy and the printing inks industry.

India’s growth story continues with a GDP growth of nearly 9%. Printing industry in India has shown healthy growth of around 12%. As committed last year, we successfully introduced the new technology acquired from the hubergroup. Which has helped us to retain and further strengthen our leadership position in the market. The new INKREDIBLE technology in the offset segment has been well received by the customers making Micro Inks the technology leader in this very competitive market.

During the year, rupee appreciated by 11% against US Dollar. This has adversely affected our export revenues. Crude oil price touched US $ 100 per barrel, stabilizing at around US $ 90 per barrel as against previous average of around US $ 67. Rising crude price has a cascading effect on other key raw materials, particularly the vegetable oils and sea-freights. Crude being the primary raw material for various chemicals, most raw materials for printing inks saw a steep rise during the year. These developments have put margins under pressure. We could deal with these twin challenges through superior technology solutions, better product mix and internal cost control measures.

In the process of global integration and consolidation of the hubergroup, in 2007, Micro Inks acquired HST USA, a wholly owned subsidiary of the huber group and in China, we merged the company’s subsidiary with Huber Shenzhen. These measures have helped us to optimize group resources and improve our customer services.

Consolidated revenues of the Company grew by 22% to Rs.15,003 million over the previous period on annualized basis. Domestic business grew by 10% during the year. Overall global revenues rose by 29% and stood at Rs.9,836 million (USD 235 million). The Company achieved EBIT and PAT of Rs.1,059 million and Rs.661 million respectively. As hubergroup worldwide, we are proud to be in the World’s Top Five Inks Companies.

Integration of group operations worldwide has been the key to our healthy performance during the year. Micro Inks now shares the common product basket and technologies of the hubergroup. Many new, innovation driven technology projects are in progress and we shall continue to set new benchmarks in quality standards.

We firmly believe that “superior technology solutions” is the only way to neutralize the cost pressures and to retain customer loyalty.

I take this opportunity to thank you all for your support and patronage. I would also like to thank our customers, employees, suppliers, financers and other business associates for their support to the Company. I hope this support shall continue in the years to come.

Sincerely yours,
Anjum Bilakhia

(Speech delivered by Chairman at the 17th Annual General Meeting held on 26th April 2008 in Vapi)