gujarat natural resources ltd Management discussions

INDUSTRIAL STRUCTURE AND DEVELOPMENT:

The Company is engaged in the business of Oil & Gas exploration and trading of goods and others. Currently the company is carrying on its business of Oil & Gas exploration through its wholly owned subsidiary and 100% step down subsidiaries.

GNRL, through its step-down subsidiary GNRL Oil & Gas Limited, has participating interests in 6 producing blocks in Cambay basin. GNRL

Oil & Gas Limited is also operator in five of these blocks.

OPPORTUNITY & THREATS:

Business conditions continue to be challenging. The industry has pushed technological boundaries but is under keener scrutiny and the frontiers are becoming even more remote. Rising costs are being driven both by cyclical factors and the end of "easy oil."

The Companys strategy is to:

Look for strategic technical partners/institutions with proven credentials in developing unconventional resources.

Evaluate and acquire assets with stranded resources.

To enhance value through efficient operations by greater reliance on local high caliber professionals and local services whilst maintaining international standards.

To unlock value through application of advance technologies

COMPETITION:

Competition in the domestic as well as international market has intensified and forced the players to adopt aggressive marketing strategy and promotional campaigns to capture and protect their market shares. The Company has the plans to penetrate better in to world market, especially through the customer retention and business development in the regions which have not been tapped.

SEGMENT WISE AND PRODUCT WISE PERFORMANCE:

The Company is carrying out its operations in oil and gas exploration, trading of goods and others.

RISK AND CONCERN:

The Board oversees Companys processes for determining risk tolerance and review managements action and comparison of overall risk tolerance to established levels. The framework is designed to enable risks to be identified, assessed and mitigated appropriately. Major risks are identified by the businesses and functions are systematically addressed through appropriate actions on a continuous basis.

INITIATIVES BY THE COMPANY:

GNRL Oil & Gas Limited (GOGL), Step down Subsidiary of the Company, has successfully completed the drilling campaign for its 3 (three) wells viz. K11, K14 and K15 at Kanwara oil fields.

At present, one of the well is tied back to the existing production set up and producing approx. 180 bbl/ day oil and 7000 scmd gas. The other two wells are on initial production testing stage and efforts are being made to put them on production by end of April, 2023 after upgrading production facilities.

It is expected that an up gradation in the production facilities will result in increase of consolidated revenue/ profitability of the Company.

OUTLOOK:

The profit margins in the industry are under pressure. However, the Company has taken remedial measures. The Company is confident to meet the challenges with its strength in marketing network, its strategic planning, Research & Development, productivity improvement and cost reduction exercise.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial disclosures.

HUMAN RESOURCE:

The Company believes in a culture of inclusion, trust, skill development, empowerment and development for its employees. It considers its human resources as its biggest asset and believes in people at the heart of its human resource strategy which set the Company apart from Companys peers. It also believes that the employees continuously strive to make the organization as inclusive as possible. The Companys organization structure is agile and focused on delivering business results. With regular communication and sustained efforts, it is ensuring that employees are aligned on common objectives and goals of the business. Industrial relations continue to remain cordial.

HEALTH, SAFETY AND ENVIRONMENTAL PROTECTION:

The people are the greatest asset, and their safety, health, and well-being is of utmost importance to us. The Company endeavours to provide a safe, conducive and productive work environment by undertaking various measures at its manufacturing facilities to ensure no injury or accident. Several other measures have been taken by the Company to ensure health and safety of its employees. The Companys ethos of environment protection by development of environment friendly processes for effective usage of resources is based on the belief that nature is a precious endowment to humanity.

CEO AND CFO CERTIFICATION:

Mr. Shalin A. Shah, Managing Director and Mr. Hitesh M. Donga, CFO have given certificate to the board as contemplated in SEBI Listing Regulations.

CAUTIONARY STATEMENT:

The statements in the "Management Discussion and Analysis Report" section describes the Companys objectives, projections, estimates, expectations and predictions, which may be "forward looking statements" within the meaning of the applicable laws and regulations. The annual results can differ materially from those expressed or implied, depending upon the economic and climatic conditions, Government policies and other incidental factors.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

Operational performance viz. total revenue during the year stood at Rs. 71.00 Lakhs as compared to Rs. 32.89 Lakhs in the previous year and the Company incurred loss tuning to Rs. 41.87 Lakhs as compared to Rs. 79.61 Lakhs in the previous year. Cash and cash equivalents at the end of the year stood at Rs. 12.47 Lakhs.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS:

	Standalone		Consolidated
	2022-23	2021-22	2022-23	2021-22
Debtors Turnover Ratio	3.86	0.00	3.46	1.37
Inventory Turnover Ratio	0.00	0.00	2.01	2.00
Interest coverage ratio	0.34	-2.76	-0.41	-4.47
Current Ratio	5.70	8.67	2.32	3.15
Debt Equity Ratio	0.14	0.04	0.32	0.17
Operating Profit Margin	29.94	0.00	-7.35	-40.62
Net Profit Margin	-58.97	0.00	-43.25	-46.23
Return on Networth	-0.33	-0.63	-5.48	-0.03
P/E Ratio	-260.60	-221.08	-16.87	-42.98

DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH

A DETAILED EXPLANATION THEREOF:

The Company has incurred loss during the year and due to adjustment of past years losses, your Company fall short to earn significant sum as return on Net Worth.

Place: Ahmedabad		For and on behalf of the Board
Date: 14th August, 2023
	Sd/-	Sd/-
	Shalin A. Shah	Ashok C. Shah
	Managing Director	Director
	DIN: 00297447	DIN: 02467830