controls switchgear contactors ltd Management discussions

CONTROL AND SWITCHGEAR CONTACTORS LIMITED ANNUAL REPORT 2005-2006 MANAGEMENT DISCUSSION AND ANALYSIS OPERATIONS: During the year under review, the Company achieved a net turnover of Rs.9,800 lacs as against Rs.7337 lacs during the previous year thereby recording a growth of 34%. The Profit after providing for tax and all expenses, depreciation of Rs.217 lacs (previous year Rs.213 lacs) and an Exchange Loss of Rs.12 lacs (as against an Exchange loss of Rs.23 lacs during the previous year) soared to Rs.1176 lacs as against Rs.751 lacs during the previous year. During the year under review the Company acquired land at Integrated Industrial Estate, BHEL, Ranipur, Haridwar for setting up a new Unit to augment its production capacities. Building for this new unit is under construction and the unit is expected to go into production by 1st October, 2006 CURRENT PERFORMANCE: The Directors report with pleasure further growth during the first three months of the current Financial Year. The turnover for the first three months of current year has amounted to Rs.2533 Lacs as against Rs.2181 Lacs during corresponding previous period thereby recording a growth of 16%. The profit after tax during the first three months has declined to Rs.127 lacs as against Rs.153 lacs during the corresponding previous period thereby recording a fall of 17%. The margins were under pressure during this quarter due to steep hike in the metal prices. Steps have been initiated to minimise the impact of increase in the price of raw materials. BENEFITS DERIVED: i. Up gradation of current range of products. ii. New products introduction. iii. Extension of existing product range for other customers. iv. Addition of new customers. FUTURE PLAN OF ACTION: i. 4 Pole Contactor 330 (4P). ii. Mini Contactor and accessories. iii. Class 20 relays. iv. LC1F 800A contactor. v. New Agro Contactor.