Voltas is at the threshold of stiking out to be a global player. In fact, of the several paths to growth before Voltas, globalisation is emerging as the first and foremost. There are three good reasons for this.

One: Voltas has an impressive record of implementation of overseas projects. Its international business is its fastest growing segment and promises to be the future growth engine for the Company.

Two: Several Voltas products and services are bcoming globally competitive in cost, delivery support and service.

Three: The caliber of personnel in its global operations compares with the best in the world.

These developments are the logical result of key strategic moves by your Company over the past few years. The first of these was to raise the quality of its business processes by implementing the Tata Business Excellence Model (TBEM). The TBEM, as you know, is modelled on the Malcolm Baldrige Award, developed by the US manufacturing industry in the Eighties to successfully thwart the challenge of Japanese imports.

The second initiative was to make its subsidiary, Voltas International, a full-fledged part of your Company. Not only did this ally Voltas Internationals global repute and international customer base with your Company's experience, knowledge base and resources, it opened up the prospect of synergising Voltas Internationals operations with our entire spectrum of engineering services.

Avenues to growth through globalisation
The road-map for Voltas future offers four avenues to growth through globalisation. Foremost among these is the undertaking of large-scale high-value engineering projects as an Engineering, Procurement and Construction (EPC) contractor in established domains like electro-mechanical (EM) services as well as in new ones such as in pumping, sewage and water treatment services.

The second route is through the increased export of our own manufactured products. The third route lies in offering services and products for the domestic market on the back of technologies acquired from overseas manufacturers. The fourth route is to grow our roster of overseas principals and representations whose products your Company markets and supports for domestic customers. Allow me to elaborate on all four avenues.

Growth as an EPC Contractor
To understand where your Company could go in EM projects and other engineering services for overseas markets, consider the journey it has already covered.

When the overseas electromechanical business was integrated into your Company in 2001-02, we had looked forward to a quantum leap in the scale, scope and value of the international projects we could undertake, now that the erstwhile Voltas Internationals operations could be underpinned by Voltas' financial resources.

This expectation was not belied. In quick time, your Company was awarded a number of mega-projects such as the Rs 480 crore Conference Palace Hotel Complex in Abu Dhabi; the Rs 225 crore Al-Udeid Air Base Project in Qatar, and the Rs 135 crore luxury liner Queen Mary II, a joint venture project in which your Company is an equal partner. Today, the International Operations business of Voltas is India's largest provider of EM services for built environments abroad with a footprint in more than 26 countries.

It has, no doubt, helped that the EM business had a legacy of two decades of noteworthy project successes in the Middle East, Far East and South East Asia, including, among others, the Palace Complex of His Majesty the Sultan of Oman in Muscat, the Bahrain International Airport, and the Chep Lap Kok international airport terminal in Hong Kong.

In implementing these projects, your Company earned the confidence of the world's leading consultants and Project Management firms such as Cansult of Canada, Turner International and Bechtel Corporation of USA, Tractbel of Belgium, Sotechni of Italy and the Hospital Design Partnership of UK. Recently, against stiff international competition, your Company was awarded a Rs 280 crore water reclamation project in Changi, Singapore, thus marking a major breakthrough into the area of Water Supply and Sewage Treatment projects.

Currently, Voltas international operations fields over 1,800 personnel posted overseas, comprising managerial and engineering staff and skilled technicians, with offices in Abu Dhabi, Dubai, Hong Kong, Qatar and Singapore. Besides its own employees, Voltas also works through several joint ventures and subsidiaries in the management and execution of projects and maintenance services.

Overall, Voltas international business delivers solutions in a remarkable array of fields, including electrical and mechanical works, refrigeration, heating-ventilation-and-cooling, public health systems, plumbing, fire fighting, security, specialised lighting, medical gases and integrated building management systems for a range of industries including communication, entertainment and information.

These capabilities serve a number of varied applications, including airports, hospitals, hotels and convention centres, commercial, shopping and office complexes, palaces,

techno-parks, research and training centres, power stations, defence establishments, textile mills, pharmaceutical plants, district cooling plants, cruise liners and railway systems.

Ambitious growth targets
Your Company has set an ambitious, but not unrealistic, growth target of 35% of the Companys total revenues to come from the business of International Operations by 2006.

In this connection, increased construction activity in Qatar for the Asian Games in 2006, in China for the Olympic Games in 2008 and in Iraq for post-war reconstruction offer specific opportunities.

To enable your Company to get its share of these, and other high-value projects, we are rapidly strengthening our ability to manage a far-flung multi-national organisation so as to

maximise the benefits of scale, consistency and cooperation between functions and businesses in various countries. We are also developing capabilities in assessing risks and in

minimising their impact, and we are improving our skills in understanding and complying with local norms in legal, social, environmental and cultural matters.

Your Company is actively pursuing joint ventures and consortium agreements for project businesses in league with entities from Europe, US, Japan and Korea, among others. In parallel, your Company is also making a concerted market extension drive by targeting prospects in Libya, Botswana, Egypt, Jordan, Vietnam and CIS countries.

Product push in overseas markets
The second broad avenue to growth lies in globally leveraging your Company's proven manufacturing skills. Your Company has already established its ability to manufacture best-in-class products at increasingly low costs by manufacturing products for a number of MNCs.

This proven advantage of your Company is now ready for an overseas thrust. A wide range of Voltas cooling products - including room air-conditioners, split air-conditioners, water coolers, visi-coolers, freezers and chest coolers - are poised for entry into markets in the Middle East, SAARC and Africa, either branded as a 'Voltas' product or as an OEM for other established local brands. In short time, this export will also include forklift trucks, water pollution control equipment and our array of pumps.

Absorbing and deploying global technologies
The third avenue to growth lies in further leveraging our technology-sharing alliances with overseas collaborators, and in seeking fresh ones, for serving the domestic market.

In the Air Conditioning and Refrigeration business, we have a new generation of clientele, such as multiplexes, shopping malls, entertainment centres, and establishments in the private telecom industry and hospitality. More than mere cooling, these clients seek solutions encompassing controlled environments, with clean and pure air, and energy-efficient systems. Your Company is well placed to deliver these solutions by leveraging the competencies of its range of partners - for example,

building management systems from Siemens, ozone injection systems from Ruks of Canada, screw and scroll chillers from global leaders - coupled with in-house design and manufacturing capabilities.

The success of the Vertis brand of room and split air conditioners is yet another example of the success of alliances. The Vertis brand features advanced technology from Fedders International Inc. USA, one of the world's largest manufacturers of air conditioners, with whom your Company has a manufacturing-only joint venture. This alliance has resulted in a brand which has moved from fifth place to second place in the Indian market in the space of two years. Looking ahead, considering that only 5% of the domestic market for air conditioners has been penetrated, the potential for growth is clearly immense.

More representations  
The fourth, and last, avenue for growth for your Company is by expanding its role as a representative of leading international manufacturers in the domestic market. With few exceptions, almost every sector of Indian industry requires the most advanced and up-to-date technologies to remain globally competitive. Voltas is well placed to identify, source and support these technologies in the industrial sectors of textile machinery, machine tools, and mining and construction equipment.

The National Highway Development Plan (NHDP), under which more than Rs 60,000 crores is to be spent on four-laning and building highways which will link the countrys major metros and criss-cross the country, is an obvious opportunity and your Company's representations are well in place to deliver precisely the construction equipment required.

In conclusion
Growth through globalisation, thus, is more than just a vision for Voltas. The recently posted results for 2002-03 are evidence that it is a road down which your Company has already made significant progress.

To refresh your memory, let me recall the essential elements of the 2002-03 results. Voltas turnover increased by 31% over the previous year. It notched up its highest-ever Operating Profit, an increase of 32% over the previous year. Its interest costs are down by 54%. It declared a dividend of 25% against 18% last year. Perhaps most significantly, it turned EVA positive after a gap of many years. And, what is relevant, the International Operations business played a large part in these successes, growing as it did by 212% over last year.

In the years to come, Voltas is confident it can carve out a secure and sustainable international niche by bringing to this endeavour its long-established edge in engineering expertise, project management, design and providing solutions, and its customer-centric approach. With that edge we intend to open up a world of value creation which will meet the highest expectations of our customers, shareholders, investors and other stakeholders.

To you, the shareholders of the Company, I express our gratitude for your trust and support, which has been a major source of strength for us. It is your continuing high expectations which drive us and your encouragement which fuels that drive. Special thanks also to all Voltas employees who have always responded to the call of these demanding times. I also take this opportunity to thank my colleagues on the Board and the Auditors for their support and advice. In a years time Voltas will complete 50 years of its existence and celebrate its Golden Jubilee, the first, I am confident, of many more jubilees to come.