hanjer fibres ltd Management discussions

HANJER FIBRES LIMITED ANNUAL REPORT 2011-2012 MANAGEMENT DISCUSSION AND ANALYSIS Overview The Companys plants remained closed during the year under review due to non viability of the unit. The Company has not done any trading activities during the year under review. Business of the Company During the year Company has not done any business activity. However, the Company is mainly engaged in the business of manufacturing Coarse Count Cotton Yarn and The Company has presently discontinued its business activities due to non viability of the unit. Industry Structure and Developments India has the unique distinction of possessing all possible varieties of cotton. India is able to offer a wide variety of cotton textiles since she is, perhaps, the producer of largest range of cottons in the world. Besides being one of the four biggest producers of raw cotton in the World. In between, there are all staple lengths and micromere values. And of course India has consumers with all kinds of incomes. The production of raw cotton in India has grown steadily. Over the years. However due to export of raw cotton post WTO 2005 the present product mix is unviable. Business Outlook The product mix became a major problem as due to exports of short and medium staple cotton leading to major competition from China due to which the end products made out of short and medium staple cotton fibre became highly competitive in price hence unviable. Hence, turnaround can be expected only after forward integration and modification of product mix. Risks and Concerns The Companys expectations and estimates may vary and the same are dependent on factors like monsoons, general economical conditions, terrorists attacks etc. affecting market sentiments in addition, the government policies and tax implications. Audit Committee & Internal Control System The Audit Committee appointed under the Board of Directors reviews the adequacy and effectiveness of the internal control systems and suggests improvement for strengthening them, from time to time. The company has instituted adequate internal control procedure commensurate with the nature of its business size of its operations. Regular internal Audits and checks ensure that responsibilities are executed effectively. Human Resources The Companys industrial relations were cordial. Cautionary Statement Estimates and expectations stated in this Management Discussion and Analysis may be forward-looking statement within the meaning of applicable securities, laws and regulations. Actual results could differ materially from those expressed or implied.