MADRAS FERTILIZERS LIMITED MANALI, 600068 54th Annual General Meeting Chennai 29th December 2020 CHAIRMAN’S SPEECH

SHRI U SARAVANAN CHAIRMAN & MANAGING DIRECTOR

Dear Shareholders, Ladies & Gentlemen coverage of Rabi seasons was normal during summer Very good morning to all of you! in irrigated belt and good consumption of fertilizer was observed. It gives me immense pleasure to extend a warm welcome to you all to the 54th Annual General Meeting The consumption of Urea and NPK have increased of your company. The Directors’ Report and the in MFL’s territory because of favourable agricultural Audited Accounts for the Financial Year ended March situation prevailed. The consumption of Urea has 31, 2020 have been with you and, with your consent; I increased in MFL’s territory over Corresponding Period shall take them as read. Last Year (CPLY) by 10.5% and NPK by 20.3% over CPLY. In view of the massive outbreak of the COVID-19 pandemic, social distancing is a norm to be followed Production Performance Highlights of MFL in and pursuant to the Circulars issued by the Ministry Financial Year 2019-20 of Corporate Affairs, AGM is being held through Video I am happy to say that your Company has, after a long Conferencing (VC) or Other Audio Visual Means awaited time, achieved and successfully completed (OAVM). the feedstock conversion from Naphtha to RLNG for Before I speak to you about the performance of your Ammonia production. company, let me briefl y highlight the economic scenario Further, some of the activities undertaken to bring in which your Company is operating. down energy levels are listed below: Economic Scenario • Installation of CT Cells M & N: After commissioning The important economic measures announced by of these 2 cells during July 2019, the availability the Government of in 2019-20 were hike in of Total Number of Fans increased to 14, High minimum support price of agriculture crops, reduction cooling water temperature problem totally in corporate tax rate, special programs for MSMEs and eliminated even during summer and taking digital payment. preventive maintenance of fans becomes easy without affecting plant loads; Fertilizers remain indispensable for agriculture productivity. In other words availability of suffi cient • The replacement of RO Stream membranes along Fertilizers were absolutely essential for sowings of with TTRO water for CW make up from Oct 19, Kharif and Rabi Crops. However, Agriculture and has made signifi cant improvement in CW quality Fertilizers Sectors continue to face challenges due to & Cooling Tower Cycles of Concentration which COVID 19 pandemic. helped in reduction of chemical consumption and frequent leaking / failure of CW exchangers. This During 2019-20, the country received very good rainfall has improved the on-stream effi ciency of the with prolonged monsoon. Excessive rains received in exchanger and ultimately plant loads; North and Central Kerala, Kodagu, Chickamagalur and Hassan. Due to adequate water in Reservoirs, crop • RLNG feed as fuel for 110 Boiler & PC Boiler in place of FO, has resulted in reduction of stack temperature, thereby boiler effi ciency improved in Nilgiris District, contribution to Armed Forces Flag with good environmental conditions; Day Fund, supply of potable water through pipelines • Replacement of Urea Reactor Liner has improved to Harikrishnapuram Village in Manali and supply the conversion ratio thereby reduction in energy of school bags and kits to Students of Government & increase in on-stream effi ciency of Urea plant; School at Mathur. • After Feed stock and Fuel conversion to Future Outlook reformers, burner conversion effi ciency has Dear Shareholders, your Company has submitted increased excess air levels brought down which a Revival Proposal to Government of India resulted in fuel consumption; through Department of Fertilizers, for its favorable • Installation of Advance Process Control for consideration. Ammonia and Urea Plants have fetched • Your Company has initiated the study of Business considerable energy reduction to the tune of 0.2 Diversifi cation keeping in view of Atma Nirbhar Gcal per MT Urea; Bharat Abhiyan. After in-depth deliberations, Your Company’s operations ended up with a loss of by an Expert Working Committee a report has ₹ 55.62 Cr during Fiscal 2019-20 as against a loss of been submitted in which three products have ₹ 83.24 Cr in the previous year due to incurrence of been emerged viz., Methanol, Liquid Nitrogen huge interest cost and Complex Fertilizer Plants were Production and Production of special grades not in line for the fi rst two quarters owing to working of Complex Fertilizers. Subsequently, the High capital crisis. Level Execution Committee has been formed to explore the possibility of execution of above At the close of March 31, 2020, totally 2181 days were mentioned products in future. completed without any lost time accident covering 7.78 million man-hours (Previous best achieved was 5.66 • Further, your Company has, in addition to million man-hours). production of Complex fertilizers, also proposed to start trading of complex fertilizers to augment Sales Performance revenue. I am proud to state that your Company has achieved • Your Company has awarded Energy Reduction sales of 3.24 Lakh MT of Vijay Neem Coated Urea and scheme study to M/s HTAS to bring down energy 66,000 MT of Vijay 17-17-17, which is 139% increase further down to 6.3 Gcal per MT Urea; over previous year. • Replacement of E1901 (Ammonia condenser) Your company is taking up intensive promotional and K1601 (Syn Gas compressor) intercoolers campaigns which help in improving our products’ with Duplex tubes improved metallurgy to prevent branding. frequent tube failures and improve on-stream Apart from selling agricultural inputs, farmer services effi ciency of Ammonia Plant; like soil sample analysis and recommendation of • Fuel conversion from FO to RLNG for Utility fertilizer dosage based on soil test report, educating Boiler 2 for energy effi ciency and environmental the farmers on weather, crop insurance and other friendly; improved farm technologies were offered. • Installation of Dedicated RO Plant to improve As part of “Swachh Bharat Mission”, Marketing of City water quality. Compost, a product from Municipality / Factory waste has been undertaken and 12040 MT sold, which is Acknowledgement 49% increase over previous year. With respect to City On behalf of the Board of Directors, I sincerely thank Compost sale, Your Company stood as topper in Tamil the shareholders, customers and all stakeholders Nadu and has reached the 6th position on All India for their continued support in the Company’s future basis. endeavours. I would like to place on record the As part of the Government of India’s initiative, MFL sincerity, hard work, commitment and dedication of the organized Farmers Interactive Session in co-ordination employees. I am grateful to the Government of India with State Department of Agriculture. and the Government of Tamilnadu for their assistance and cooperation. During the countrywide lockdown due to COVID 19 pandemic from March 25, 2020, Your Company I also express my sincere thanks to SEBI, NSDL, Stock Plants were running successfully and products Exchanges, State Bank of India, Indian Oil Corporation were transported and dispatched to dealer point and Institutions for the support and coordination with the support of Department of Fertilizers, given to the company regularly. It will certainly be our Ministry of Chemicals and Fertilizers, Government endeavor to put in our best efforts for sustained growth, of India and Government of Tamil Nadu. The above expansion and prosperity of the Company benefi tting achievement could be made with sheer dedication of all stakeholders. employees coupled with the appropriate and adequate I look forward to seeing you in person at the next year precautionary measures taken by the Management. AGM. Corporate Social Responsibility (CSR) Thank you and Jai Hind! During the year 2019-20, your Company has spent a U Saravanan total sum of ₹ 9,24,000/- in various CSR activities viz., Chairman & Managing Director donations of food materials for fl ood affected public