MANAGEMENT DISCUSSION AND ANALYSIS REPORT: a. Industry Structure And Developments: With the bifurcation of Andhra Pradesh in to two new states, and with a new capital for Andhra coming up, the coming years are likely to see an upswing in the infrastructure development. Further, with a new government at the centre, promising development, there is a positive expectation from the industry. Therefore, with efficient Management and sustained demand the outlook for next year is likely to be encouraging. Sugar being an agro-based industry needs good rainfall and irrigation facilities. However with the expectation of a reasonably good monsoon, we are optimistic about the availability of sugar cane and we are hopeful of sustaining last year's performance in terms of crushing quantity. As far as Power operations are concerned, with sustained performance in sugar cane crushing and adequate availability of bagasse, we look forward to sustained generation of power. However much depends upon the outcome of APERC's decision on revision of tariff and also the new government's policy on power. b. Opportunities and threats: The scenario for infrastructure looks encouraging with the formation of new capital in process. However, until the government funding actually starts on infrastructure and capital construction, we have to tackle the bottlenecks in terms of rising input costs, brssure on margin, etc. However with the forecasted demand for cement for the year 2014-2015, outlook for cement industry though challenging appears encouraging. c. Segment or product-wise performance: Segment-wise or product-wise performance has already been furnished elsewhere in this Report. d. Outlook: Division-wise outlook has already been furnished elsewhere in this Report. e. Risks and concerns: The Cement, Sugar and Power industries being core industries, there is no risk of product obsolescence or steep fall in demand by way of product substitution or otherwise and therefore, your Directors do not foresee any major risks and concerns, in the near future except as discussed elsewhere in this Report. f. Internal control systems and their adequacy: The Company has adequate internal control system. Apart from this, the Company also has independent internal auditors, who conduct periodical audit and their report is taken into account by the Audit Committee for its review and suggest remedial actions wherever required. g. Financial Performance with respect to operational performance: This has been already discussed elsewhere in this Report. h. Human Resources / Industrial Relations: The Company enjoys cordial industrial relations with employees and believes that human resources are an invaluable asset. The Board wishes to place on record its apbrciation to all employees for their efforts and cooperation for the performance and growth of business during the year. i. Corporate Social Responsibility: During the financial year ended 31st March 2015 your Company supplied cement at concessional price to the State Government as part of its Indiramma Housing Welfare Scheme. A CSR committee of Directors has been set up to draw a policy and oversee its implementation. j. CAUTIONARY STATEMENT: Statements in this "Management Discussion & Analysis" may be considered to be "forward looking statements" within the meaning of applicable securities laws or regulations. Actual results could differ materially from those exbrssed or implied. Important factors that could make a difference to the Company's operations include global and Indian demand-supply conditions, increased installed capacity, finished goods prices, raw materials availability and prices, cyclical demand and pricing in the Company's markets, changes in Government regulations, tax regimes, besides other factors, such as litigations and labour negotiations. ACKNOWLEDGEMENTS: Your Directors apbrciate the support and the cooperation received from the State Government, NEDCAP, APTRANSCO and the Central Government for the Company's growth and development. Your Directors would like to convey the deep apbrciation to all the employees and workers of the Company for their sustained effort and wholehearted co-operation throughout the year. Your Directors thank the Distributors, Dealers and Suppliers for their continuous support and active involvement. Finally your Directors record their deep sense of gratitude to all the Shareholders for the abundant confidence reposed in the Board of Directors. For and on behalf of the Board P. Venkateswarlu Chairman & Managing Director DIN: 00276684 Place: Hyderabad Date :28th May 2015 |