Industry Structure and Development
The Indian footwear industry has witnessed a metamorphosis growth with the advent ofnew retail brands in the market. The industry has grown by leaps & bounds in the lastdecade with the introduction of new technology and inflow of investments.
Your Company is predominantly engaged in the manufacturing of Light Weight HawaiChappals, Canvas Shoes, PVC Shoes, Synthetic Leather Chappals, fancy Chappals and alsoengaged In manufacturing of EVA Injected Footwear. Your Company's brand name 'LEHAR'has built up a better Image over the other brands available in the local market. The majordemand In nonleather footwear sector is of Eva injected Chappals because it Is thecheapest footwear available in India. The Eva injected Chappals have captured 75% ofdemand in rural areas, because in rural areas people use this product as multipurposefootwear.
There is still lot of potential for growth In the turnover of the Company because thedemand of Company's products In the market Is fast Increasing. The Company is speciallydeveloping an innovative and different type of product as per requirement of the market.There Is strong Demand of Eva & PU products in the market hence management has plannedto expand its production capacity to cater the increased demand.
• Stiff competition in the footwear industry.
• Change of technology.
• Opening of the Indian economy for overseas players
• Any unfavorable change in Govt. Policies may affect the profitability of thecompany.
• Entry of new competitors in the domestic market.
• Scarcity of technically skilled personnel.
• Very good demand of products of the Company.
• Strong management team and a motivated and efficient work force.
• Profit making company since incorporation with proven track record.
• Multi- product capability having integrated facilities.
• Good operational performance.
• Effective marketing network.
• Good R&D.
Financial performance of the Company has been good despite of an adverse economicenvironment and your company Is doing well on fulfilling it's objectives of growth,profitability and maximization of shareholders wealth.
Turnover of the Company for the year under review has been Increased by 6.52% from Rs.2836.13 Lacs to Rs.3021.52 Lacs. This Increase in turnover is majority on account ofincrease in sales volume however selling price remained almost constant, the Net Profit ofthe Company Rs 7483.15 Lacs as against 15.27 Lacs in the previous year.
Internal control System and their adequacy
The Company has an adequate system of Internal controls comprising authorizationlevels, supervision, checks and balances and procedures through documented policyguidelines and manuals, which provide that all transactions are authorized, recorded andreported correctly and compliance with policies and statues are ensured. The operationalmanagers exercise their control over business processes through operational systems,procedural manual and financial limits of authority manual, which are reviewed and updatedon an on going basis to improve the systems and efficiency of operations. The companyplaces prime importance on an effective internal audit system. The internal control systemis supplemented by Internal audit, regular review by the management and well-documentedpolicies. The Company has an independent internal audit system to monitor the entireoperations and services. The top management and Audit Committee of the Board review thefindings of the Internal Auditor and takes remedial actions accordingly.
Human resource / Industrial Relations
The Company always believes that its growth is closely linked with the growth andoverall development of its employees. The Company is committed to upgrade the skill of itsemployees and to create an environment where excellence is recognized and rewarded. Thetarget Is to place right people at right position and to enhance the efficiency, workingspeed, competency and time management skill of its employees. The Company's endeavour isto create an environment where people can use all of their capabilities in promoting thebusiness of the Company. Number of people employed as at 31/03/2010 is 156 including thecontract labour.
The Company will enter in the mobile & communication Sector therefore, the Companyhas incorporated a Subsidiary Company in the name of JMR Mobilink Private Limited as on16/07/2010.
Further, the company will install 3 new machines for manufacturing of PU footwearduring the financial year 2010-11
The report may contain certain statements that the Company believes are, or may beconsidered to be forward looking statements that describe our objectives,plans or goals. All these forward looking statements are subject to certain risks anduncertainties, including but limited to, Government action, economic development, risksinherent in the Company's growth strategy and other factors that could cause the actualresults to differ materially from those contemplated by the relevant forward lookingstatements.