Avinash Gandhi
Chairman
Dear Shareholders,
The past two years have tested the resilience of individuals and businesses at an unprecedented level. It was no different at Schaeffler India. However, despite the odds stacking up, we adapted quickly to the evolving environment and bounced back with renewed vigour. The grit and determination of our people has enabled us to stay the course, even during the much more intense second wave of the pandemic that threatened to derail the fragile recovery post the first wave.
I hope this letter finds you in good health, as we prepare to leave the pandemic behind and gear up for a new and exciting future. However, it’s better to err on the side of caution. The past two years have also demonstrated the power of our collective ingenuity to ward of a crisis of such magnitude. Inoculating more than a billion in record time speaks volumes of the nation’s commitment to protecting its people. We ensured 100% vaccination of our colleagues in India.
Reviewing the operating environment
The Indian economy continues recover steadily, with the World Economic Forum (WEF) pegging its growth at 8.3% for FY2022, as domestic consumption return to pre-pandemic levels. The government’s focus on ensuring a broadbased recovery was also reflected in the latest Budget 2022-23 speech with thrust on capital investments and domestic manufacturing.
The automotive sector witnessed a rebound in 2021, but supply chain disruptions, semiconductor shortages and input cost pressures remained an overhang. Favourable government policies such as the extension of FAME-II scheme till 2024, multiple PLI schemes, announcement of scrappage policy and rollout of battery swapping policy are likely to aid growth and address short-term challenges.
The automotive landscape is undergoing a technological transformation. At Schaeffler, we are already working on future-ready solutions to support our customers in this transition. Our Aftermarket business is widening its product offerings. On the Industrial front, the core industries recovered and remained buoyed by a gamut of initiatives to promote investments and growth in the entire manufacturing value-chain. Our continued sectoral focus, network expansion and emphasis on innovation-led offerings have helped us make long-term gains in the market.
With India’s commitment at COP26 to reduce 45% carbon intensity by 2030 and reach net zero by 2070, green energy and clean mobility systems have become a key focus area. The development of domestic manufacturing ecosystem for renewable technologies has become more imperative than ever. To that end, Schaeffler India is consolidating its efforts under the larger umbrella of ESG, that will help us to take the lead to drive holistic value in the long term.
Making a meaningful difference
Over the last decade, we have consciously moved from CSR being a compliance requirement to it being integrated into our business practices. In line with our commitment to driving inclusive growth, we continue to undertake focused interventions under our umbrella initiative, HOPE. Several step change initiatives for community development are in place, and we added more programmes during the year beyond health and hygiene, education and empowerment. Our most recent initiative to create a self-sufficient model through watershed management in a village, prone to severe drought, is a remarkable example of elevate the quality of life.
Creating all-round value
During the year, the Board has taken progressive steps to ensure that we stay on course to deliver sustainable value for our stakeholders. The Board approved a share split – one equity share of face value of ` 10 each into five equity shares of face value of ` 2 each.
Schaeffler as a Group has committed to be climate neutral by 2040. Schaeffler India has embarked on this journey to contribute to our global targets, while ensuring a responsible and sustainable tomorrow and further solidifying our stakeholders’ trust. We are also integrating ESG considerations into our business practices.
We expect to sustain our strong growth momentum driven by a robust strategy focused on localisation. To stay ahead of the curve, we will continue to review our progress and revisit our focus areas based on the dynamic environment in which we operate and the opportunities that emerge. We are developing future-ready technologies to drive sustainable mobility solutions.
On behalf of the Board and the entire team at Schaeffler India, I solicit your continued cooperation and support for all our future endeavours.
Sincerely,
Avinash Gandhi
