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a. Industry structure and developments
The Company is engaged in the production of Portable Gensets, Higher KVA generators,Multi Purpose Engines, Pump sets, Sprayers, Inverters, Power Tillers and Wind Energy. Inaddition to this the Company is engaged in trading of gen sets and electrical items.
While the diesel gen sets are popular among rural/industrial consumers, urban consumersprefer petrol/kerosene based portable gensets and inverters.
In the recent years inverter because of its advantages of easy, automatic, noise lessoperation and relatively low running cost is cutting sales of petrol/kerosene basedportable gen sets. Portable gen sets industry is also facing stiff competition fromcheaper Chinese products.
Multi purpose engines manufactured by the Company are useful particularly to small /medium scale farmers having small land holdings. The products are extremely compact, lightweight, portable and efficient and are becoming popular in the farming community becauseof their reliability, low maintenance and low running costs.
There are number of branded/unbranded players of electrical appliances having cutthroat competition among themselves.
Despite cheaper cost of production, wind energy is not very much popular in the Countryand the industry is passing through initial years of its evolution.
b. Opportunities and threats
In a power starved developing Country, there is tremendous potential for powergeneration & storage devices. With inverter manufacturing facility already madeoperational, the Company is in a position to capture larger market share. It is expectedthat in liberal economy, due to increased pressure on Government’s exchequer, subsidyon petroleum product will be rationalized in near future pushing prices of diesel upwardand making petrol based gen sets competitive with Diesel generators leading to increasedopportunities for the Company.
Wind energy industry is in initial years of it’s evolution in the Country. Due tocomparatively low cost of production there are huge potential for wind energy.
Power Tillers are used by farmers who own small piece of land and face competition fromcheaper imported items from China.
c. Segment wise performance
Segment wise performance of the Company during the financial period ended on 31stMarch, 2010 is given below;
PRIMARY SEGMENT (Product Wise)
| || || || ||(Rs. in lacs) |
|Particulars ||Power & Allied products ||Electrical Appliances ||Others ||Total |
|Sales (Gross) ||8005.98 ||15767.46 ||38.90 ||23812.34 |
|Power & Allied Products ||: Manufacturing Portable Generators, Engines, Pumps, Inverters and trading of Allied |
| ||Products |
|Electrical Appliances ||: Trading of Electrical appliances and miscellaneous components. |
|Others ||: Wind Mill Energy Generation |
In the long run the Company visualise itself as one stop shop for all sort of powersolutions with variety of products with different capacities to cater all segments ofeconomy.
e. Risks and concerns
Your Company is exposed to the business and financial risks. Business risks includeneed for continuous technological up-gradation to meet emission standards/safetyrequirements, customers’ higher expectations for better value.
All these risks are continuously addressed in the business plans, functionalstrategies, management review and acted upon.
Foreign exchange risks are inherent in exports of products, import of materials,capital equipment etc. The Company has a well-defined exposure management system to reviewits exchange exposure and to take measures to mitigate losses.
f. Internal control systems and their adequacy
Your Company has placed considerable emphasis and effort on internal control systems.On the finance and administrative side, the internal checks and balances are augmented bya formal system of Internal and management audit.
g. Material developments in Human Resources
Your Company continues to lay emphasis on qualitative growth of its human resources byproviding congenial and constructive work environment.
h. Financial Highlights
Sales (net of excise) during the financial year ended on 31st March, 2010was Rs.23812.34 Lacs as against 22477.23 lacs during the last financial year ended on 31stMarch, 2009.
During the financial year ended as on 31st March, 2010 the Company hasearned a net profit of Rs. 134.60 Lacs as against 317.27 lacs earned during the lastfinancial year ended on 31st March, 2009.
3. Fixed Assets
For the financial year ended on 31st March, 2010 the Company added 544.02lacs to its gross block of assets
4. Sundry Debtors
Sundry Debtors amounting to Rs.13075.69 Lacs as at 31st March, 2010 ascompared to Rs. 12131.87 lacs as at 31st March, 2009.
Statements in this report on Management’s Discussion and Analysis describing theCompany’s objectives, projections, estimates, expectations or predictions may beforward looking statements within the meaning of applicable security laws or regulations.These statements are based on certain assumptions and expectation of future events. Actualresults could however differ materially from those expressed or implied.
The Company assumes no responsibility in respect of forward looking statements hereinwhich may undergo changes in future on the basis of subsequent developments, informationor events.