MANAGEMENT DISCUSSION AND ANALYSIS REPORT 1. Industry overview: The financial year 2014-2015 started with a bleak mindset on global economy but afterward it progressed in a positive direction in comparison to the last year. The year under review was expected to face the force of the economic crises. However, the Indian Economy displayed a remarkable resilience and has almost bounced back from the aftereffects of the recent global melt-down. There has been a increasing demand impacting both, exports as well domestic consumption. However, the Indian Economy continues to grow robustly. This is evident from increase demand in steel, cement and other sectors. There has been stress on the development in the field of agriculture by the Government. Inspite of all this, the Company managed to perform relatively better since it is driven more by domestic consumption. It is anticipated that there shall be increased business opportunities for the Company in the nearfuture. 2. Outlook on opportunities, threats, risks and concerns: The Company is focused on PVC Pipes as well as its core product Sprinkler Irrigation System and Drip Irrigation System to the retail segment. Increasing demand of the product of the Company has created the opportunities of further growth in sale of the Company's product. It is expected that recovery in economy and stress of the government in agriculture area will together result in ample business opportunities for the Company. However, there will also be increased competition, mainly from small manufactures of unorganized sectors. 3. Internal Control System & Adequacy: The Company has an adequate system of internal controls commensurate with the size and nature of business of the Company designed to provide reasonable assurance that assets are safeguarded; transactions are executed in accordance with the management's authorization and properly recorded. Accounting records are adequate for brparation of financial statements and other financial information. Internal audit is conducted on a continuous basis to ascertain the adequacy and effectiveness of internal control systems. Their observations are reviewed by the senior management and the Audit Committee. 4. Financial Performance: The Sales and other income for the year under review was Rs. 6716.81 Lacs. The profit debrciation and tax was Rs. 386.86 Lacs after providing Rs. 140.00 Lacs for debrciation and Rs. 49.40 Lacs for taxes. The net profit forthe year was Rs. 212.63 Lacs. 5. Material Development in H.R. Fronts: Human capital being the most crucial asset of the Company, the Company has to continue to invest in the development of its employees, which is very important for ensuring sustained high performance. The Company is in the process of strengthening and introducing a system that would enable employees to track their own progress as well as bring up issues that concerns them and the Company for better performance The industrial relation continued to remain cordial throughout the year. For and on Behalf of the Board For Rungta Irrigation Ltd. Sd/- (M.P.RUNGTA) Chairman cum Managing Director Date : 11th August 2015 Place: New Delhi |