MANAGEMENT DISCUSSION AND ANALYSIS: a. Industry Structure & Developments, Opportunities and Future Outlook: The global economy growth remained sluggish in the last year, with stagnating GDPs and low inflation continuing to plague the developed economies. The weak global growth led to decline in commodity prices including crude oil. This has helped the oil importing countries like India to reduce their fiscal deficit. India's GDP growth during FY 2014-15 was 7.3% as against a growth of 6.9% in FY 2013-14. while India's economic revival has been moderate, there have been plenty of positives during FY 2014-15. Easing of international crude oil prices helped in reducing the subsidies bill which has supported the fiscal consolidation efforts of the government. Inflation, which remained high for last several years, has dropped to reasonable levels now. This has prompted RBI to cut the repo rate three times in the last year to bring it down 7.25%. FDI inflows have increased to $34.9 billion in FY 2014-15, a reflection of increased confidence of foreign investors in Indian economy. The new government has initiated several key policy reforms like 'Make In India', improving ease of doing business, coal mining auctions, infrastructure project approvals etc. Driven by these positives, FY 2015-16 is expected to be a turnaround year for the Indian economy. A lot will depend on the ability of the government to push the key pending policy reforms like GST, Land Acquisition Bill etc. Overall, the prospect of high growth backed by policy reforms, combined with macroeconomic stability, is the promise of India going forward. The Company, being a Non-Banking Financial Company (NBFC) registered with RBI, derives major revenue from its investments. Sectoral policy changes by the Government, therefore, have direct impact on the profitability of the Company, as the value of the stocks, shares and bonds depends on the brvailing capital markets scenario. The future success of the Company would depend on its ability to anticipate the volatility of the Stock Markets and minimising risks through prudent investing decisions. with the stock markets hitting new peaks on a regular basis, the FY 2014-15 turned out to be a bonanza for investors. The investments of the Company are typically long term in nature and brdominantly in the equities market. All investments decisions are reviewed by the Board of Directors on a quarterly basis. As at March 31, 2015, the market value of the Company's quoted investment portfolio stood at Rs. 644.55 crores. b. Risks, Threats and Concerns: Risk management can be construed as the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities. The Risk Management Committee (RMC) of the Board of Directors manages and monitors the Company's risks. c. Internal control systems and their adequacy: The Company has an adequate internal audit and control system commensurate with its size and nature of business to ensure operational efficiency, accuracy and promptness in financial reporting and compliance of various laws and regulations. The Audit Committee of the Board of Directors reviews the Internal Audit Report and the adequacy and effectiveness of internal controls periodically. d. Human Resources: Employee relations continued to remain cordial during the year under review. As on March 31, 2015, there were six (6) employees including Key Managerial Personnel of the Company. CAUTIONARY STATEMENT: Statements in the Management Discussion and Analysis describing the Company's objectives, projections, estimates and expectations may constitute "forward looking statements" within the meaning of applicable laws and regulations. Actual results might differ materially from those either exbrssed or implied. |