Sanghvi Movers L Chairman Speech

Dear Shareholders,

Financial year 2016-17 has been another good year of progress and growth for Sanghvi Movers Limited and I take this opportunity to share the performance of your Company and several initiatives undertaken during the year that have contributed to this performance.

Indian Economy:

During the financial year 2016-17, the global macroeconomic situation was impacted by various events, which have in turn affected the business environment in India. The Indian economy is in a strong position compared to the continued tepid global economic growth and outlook. Many sectors such as infrastructure, power generation (especially renewable energy), transmission and distribution, refineries and petrochemicals, are seeing increased investments leading to infrastructure sector growth. While there are challenges in any business environment, India’s overall macro fundamentals are strong.

Keeping in view the market conditions, your Company has performed exceedingly well and delivered strong growth in the last financial year. The continued growth of Sanghvi Movers Limited is linked to the overall performance of the Indian economy and sustainable public and private sector capital expenditure. Against this milieu, the Company will continue to focus on sustaining profitable growth, maintain operational excellence and selectively pursue large orders.

Performance highlights:

In the fiscal year 2016-17, turnover of your Company was at an all-time high at Rs. 562.88 crores, representing an increase of 6 percent over the previous year. Net profit before tax (excluding exceptional items) was Rs. 161.49 crores. Your Company was able to grow revenues and profitably despite the challenges prevailing in the global and the tough domestic business environment. The Company generated significant cash accruals, strengthened its Balance Sheet and financial position and continued to return value to its shareholders.

Dividend:

Your Board has recommended a dividend of Rs. 4/- per share of Rs. 2/- fully paid-up (200 percent) subject to your approval atthe Annual General Meeting.

Capex:

Capex for FY 2016-17

The company has done Net Capital Expenditure of Rs.151 Crores in the current financial year and has purchased 5 Nos. New Terex Demag CC 3800-1 Cranes (Capacity- 650 MT) and Derrick Attachments. These cranes can erect windmills upto 3 MW and has height of 165 meters, these are next generation cranes for future wind mills & projects. In addition to this, the Company has already bought Office premises in BKC, Bombay. Hence the Total Capex done for the FY 2016-17 is around Rs. 205 Crores.

The company has judicially used its cash flow partly towards funding its capex plan for FY 2017 and partly for reducing its bank loans. The company has repaid loans in excess of Rs. 265 Crores during the last financial year. As on 31^st March, 2017, Total Outstanding Bank Borrowings including Cash Credit, Buyers’ Credit, & Unsecured Loans is Rs. 545 Crores. The Debt: Equity Ratio is 0.63:1 which is quite comfortable considering the capital intensive nature of company’s business model and the asset base which it has created over last 25 years.

Proposed Capex for FY 2017-18

The company proposes to import 7 Nos. Brand New Terex Demag CC 3800 Cranes (Capacity - 650 Tons) and 18 Nos. Brand New Grove GMK6300L Cranes (Capacity-300 Tons). The Net Capex (after sale of cranes under Trade-in agreement) would be aroundRs. 275 Crores.

The projected amount of Debt: Equity Ratio as on 31 March 2018 after doing this capex would be around 0.80:1.

CSR:

Your Company has spent a sum of Rs. 121.37 Lakhs on CSR during the financial year 2016-17. Your Company is also committed to its social responsibility agenda and contributes meaningfully to the communities that it operates in. Your Company continues to focus in the areas of Education, Healthcare and Sustainable Livelihood.

Our commitment towards the communities where we operate also remained steadfast. One of our key initiatives last year was to provide education to underprivileged children’s, that was run in partnership with Pune City Connect Development Foundation, Teach for India, Jagriti School for Blind Girls, Helplife, I teach movement, Vanitashray and Sant Gajanan Maharaj Shikshan Sanstha. The Company also supported Maher, Late Vaibhav Phalnikar Memorial Foundation, Ashray, KEM Micro Grid Village Project, Navkshitij, Lata Mangeshkar Medical Foundation and Janseva Foundation. Work in these areas is expected to be enhanced further in theyears ahead.

Conclusion:

The Indian economy is in a strong position and many core sectors saw increased investments leading to positive growth. I believe, human capital plays a vital role in achieving in the success of our company. I believe our existing talent pool will enable your Company to continue to outperform peers.

I thank you all for your immense support and continued confidence in the Management of our Company. I would like to convey my gratitude to all our stakeholders including our esteemed banks, vendors and customers for their consistent faith in us. We seek the cooperation of all stakeholders to make thejourney even more exciting and rewarding, going forward. I am optimistic that Sanghvi Movers Limited will continue to grow and succeed.

Yours truly,

Chandrakant P. Sanghvi

Chairman & Managing Director