Message from the Chairman

Dear Shareholders,
Greetings to all of you, with great pride and gratitude, I present to you the 59th Annual Report of Raunaq International Limited for FY 2023-24.
The past few years have tested the resilience of individuals and businesses at an unprecedented level. It was also the same at Raunaq International. The Company has shown its commitment to emerge out of the past ordeal and moving towards diversified portfolio for a sustained growth going forward.
I am delighted to share that, despite navigating through global economic challenges, the Indian economy showcased remarkable resilience, achieving a robust growth of 7.6% in FY 2023-24. India’s continued status as the world’s fastest-growing major economy speaks volumes about our robust domestic demand, supportive government policies and substantial foreign direct investment (FDI) inflows. Amidst global supply chain disruptions, the adoption of the ‘China Plus One’ strategy to reduce dependency on China has gained traction.
The Government of India’s efforts to boost infrastructure development while undertaking fiscal consolidation and provide an enabling business environment will help in increased manufacturing competitiveness to augment exports and drive future growth.

The triggers for growth in FY 2024-25 will come from higher capital expenditure on infrastructure development both by central and state governments, rise in private corporate investment, strong service sector performance and improved consumer confidence.

The government’s focus on building infrastructure of the future has been evident given the slew of initiatives launched recently. Infrastructure support to the nation’s manufacturers also remains one of the top agendas as it will significantly transform goods and exports movement making freight delivery effective and economical. The infrastructure sector acts as a catalyst for India’s economic growth as it drives the growth of the allied sectors like townships, housing, built-up infrastructure, and construction development projects.

To meet India’s aim of reaching a US$ 5 trillion economy by 2025, infrastructure development is the need of the hour. The government has launched the National Infrastructure Pipeline (NIP) combined with other initiatives such as ‘Make in India’ and the production-linked incentives (PLI) scheme to augment the growth of the infrastructure sector. Historically, more than 80% of the country’s infrastructure spending has gone towards funding for transportation, electricity, and water, and irrigation.

Infrastructure sector is a key driver for the Indian economy. The sector is highly responsible for propelling India’s overall development and enjoys intense focus from Government for initiating policies that would ensure time-bound creation of world class infrastructure in the country. Infrastructure sector includes power, bridges, dams, roads, and urban infrastructure development.

The infrastructure sector has become the biggest focus area for the Government of India. India plans to spend US$ 1.4 trillion on infrastructure during 2019-23 to have a sustainable development of the country. The Government has suggested investment of Rs. 5,000,000 crore (US$ 750 billion) for railways infrastructure from 2018-30. While these sectors still remain the key focus, the government has also started to focus on other sectors as India’s environment and demographics are evolving. There is a compelling need for enhanced and improved delivery across the whole infrastructure spectrum, from housing provision to water and sanitation services to digital and transportation demands, which will assure economic growth, increase quality of life, and boost sectoral competitiveness.

Power is among the most critical components of infrastructure, crucial for the economic growth and welfare of nations. The fundamental principle of India’s power industry has been to provide universal access to affordable power in a sustainable way. The Ministry of Power has made significant efforts over the past few years to turn the country from one with a power shortage to one with a surplus by establishing a single national grid, fortifying the distribution network, and achieving universal household electrification. India’s power sector is one of the most diversified in the world. Sources of power generation range from conventional sources such as coal, lignite, natural gas, oil, hydro and nuclear power, to viable non-conventional sources such as wind, solar, agricultural and domestic waste. India was ranked fourth in wind power capacity and solar power capacity and fourth in renewable power installed capacity, as of 2021. India is the only country among the G20 nations that is on track to achieve the targets under the Paris Agreement.

Power is one of the most important infrastructure elements, essential to national wellbeing and economic development. For the Indian economy to grow steadily, enough electrical infrastructure must exist and be developed. India’s power generation sources range from conventional sources such as coal, lignite, natural gas, oil, hydro and nuclear power to viable non-conventional sources such as wind, solar, and agricultural and domestic waste.

India’s power sector is one of the most diversified in the world. Sources of power generation range from conventional sources such as coal, lignite, natural gas, oil, hydro and nuclear power to viable non-conventional sources such as wind, solar, and agricultural and domestic waste. Electricity demand in the country has increased rapidly and is expected to rise further in the years to come. In order to meet the increasing demand for electricity in the country, massive addition to the installed generating capacity is required.

The Government of India is preparing a ‘rent a roof’ policy for supporting its target of generating 40 GW of power through solar rooftop projects by 2022. It also plans to set up 21 new nuclear power reactors with a total installed capacity of 15,700 MW by 2031.

The Central Electricity Authority (CEA) estimates India’s power requirement to grow to reach 817 GW by 2030. Also, by 2029-30, CEA estimates that the share of renewable energy generation would increase from 18% to 44%, while that of thermal energy is expected to reduce from 78% to 52%.

During the Financial Year 2023-24, despite the Company’s difficulty to arrange for Bank Guarantees due to strict Banking Norms for EPC Industry, the Company has quoted for few tenders and out of them, the Company has successfully secured a work order for “2x800 MW (Phase-II) Mahan Ultra Supercritical Thermal Power Project, Village: Bandhaura, District: Singrauli, Madhya Pradesh” amounting Rs. 14.98 Crores which will reflect in revenues in FY 2024-25.

During the year under review, as there were not much pendency in the existing jobs so major revenues booked from the trading activity hence there is a downturn in the total revenue of the Company from Rs. 778.96 Lakhs in FY 2022-23 to Rs. 465.11 Lakhs in FY 2023-24.

To sustain the overall growth of the Company, the Company has diversified into trading activities in the auto component business apart from continuing bidding for EPC contracts which the Company is confident of obtaining contracts of reasonable value for which bank guarantees can easily being arranged. Due to this reason the name of the Company has been changed from Raunaq EPC International Limited to Raunaq International Limited.

The Company will cautiously quote for new tenders in EPC business going forward and would utilize the long drawn experience of the EPC business. Simultaneously the Company further has explored possibilities in the trading business which cater to the auto component business which would also add to the revenues of the Company.

We will constantly strive for timely execution of jobs with best engineering capabilities available and we are also focusing on the trading business/machining activities along with the EPC projects which can be manageable with the available banking facilities.

I would like to spread out my sincerest gratitude to our employees, customers, partners, business associates and our stakeholders for their undying faith and support. Each one has been a part of our exciting and enriching journey. We continue to seek value creation for our stakeholders and persevere in building a sustainable business. Here is hoping for a brighter and stronger future together.

Warm Regards,

Surinder Paul Kanwar
Chairman and Managing Director