MANAGEMENT DISCUSSION AND ANALYSISWe submit here management discussion and analysis on the business of the Company. MANAGEMENT OUTLOOK Industrial and GDP growth rate of India ranks one of the highest in the world. YourDirectors feel that the trend would continue in the coming years. Industrial Gasesindustry would play very major roles in the growth of the country's economy in terms ofimproving productivity of process or savings of specific energy consumption in the coresector. The segments like production of steel, petrochemicals, oil exploration, drugs andpharmaceuticals, cold chains, healthcare etc. where industrial gases find majorapplications, are likely to show robust growth. Company's plants are expected to get fullyloaded by this year. It is expected that in spite of competitors adding on more capacity, the supply demandequation would remain healthy in most part of the countries fuelled by higher industrialgrowth. Your company has made forays into the areas of dedicated Healthcare services,specialty gases and Dry Ice business in the coming year. The Company has also beenactively negotiating with users for capacity expansion by installing new plants in freshlocations. OPPORTUNITIES AND THREATS Modernisations and expansion programme of existing of Steel Plants as well asestablishment of new Plants will create market opportunities for setting up on siteplants. It is also expected that demand for Medical Oxygen will increase by 25% (4,50,000Cu.m. to 5,60,000 Cu.m.per month) However volume growth in the current year will be dependent on Power availability,Cylinder availability and Plant Performance. PRODUCTWISE PERFORMANCE | | 2009-10 | 2008-09 | | | Cu.m. | Cu.m. | | Oxygen | Production | 2,54,17,532 | 2,20,21,258 | | Sales | 2,53,79,246 | 2,19,38,252 | | Nitrogen | Production | 1,46,40,006 | 1,00,61,674 | | Sales | 1,46,08,880 | 1,00,61,070 | | Argon | Production | 1,54,403 | 3,68,697 | | Sales | 1,51,740 | 3,68,083 | | Dissolved Acetylene | Production | 90,749 | 72,963 | | Sales | 90,452 | 74,685 | | Medical Oxygen | Production | 1,98,150 | 1,39,249 | | Sales | 1,98,151 | 1,39,564 | | Carbon-di-Oxide | Production | 4,49,904 | 3,24,574 | | Sales | 4,06,332 | 3,24,814 | | Gas Mixtures | Production | 43,022 | 13,123 | | Sales | 42,498 | 13,093 | Aggregate production of all class of goods in terms of Cu.m. during the year 2009-2010was 4,10,05,194 Cu.m. as compared to 3,30,01,538 Cu.m. in the year 2008-2009 therebyrepresenting an increase of 24.21% approximately. Aggregate sales of all class of goods in terms of Cu.m. during the year 2009-2010 was4,08,88,726 Cu.m. as compared to 3,29,19,561 Cu.m. in the year 2008-2009 therebyrepresenting an increase of 24.21 % approximately. RISK AND CONCERNS Apart from normal risks applicable to an Industrial undertaking, the Company does notforesee any serious area of concern. INTERNAL CONTROL SYSTEM The Company has proper and adequate systems of Internal Control. FINANCIAL PERFORMANCE The details of financial performance of the Company are appearing in the Balance Sheetand the Profit and Loss Account for the year. HUMAN RESOURCES During the year employer / employee relationships remained coordial. With regard to theimplementation of retirement benefits of employees, discussions are in progress. DISCLAIMER Certain statement in this report relating to Company's objectives or expectations maybe forward, looking statements within the meaning of applicable laws. Actual results couldhowever differ materially from those expressed or implied.
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