kotak nifty etf Management discussions

ARCL ORGANICS LIMITED ANNUAL REPORT 2010-2011 MANAGEMENT DISCUSSION AND ANALYSIS MANAGEMENTS DISCUSSION AND ANALYSIS During the year under review, the Net Operating Profit before depreciation and taxes has increased to Rs 752.61 Lacs compared to Rs 293.98 Lacs in the previous year. The increase in operating profit margin has taken place due to the merger of M/s Allied Resins & Chemicals Limited with your company, the economic gains due to larger scale of operation, good inventory management, and purchase of raw material at a lower cost. The turnover has also recorded a substantial increase of Rs. 13392.03 Lacs as compared to Rs. 6978.42 Lacs in the last year which is again a result of merger as well the growth in the market. MERGER As per the Scheme approved by the Shareholders, M/s Allied Resins & Chemicals Limited has been merged with the Company vide the Order of the Honble Calcutta High Court dated 15;h September, 2010 w.e.f. 12* October, 2010. The merger is in the swap ratio of 2:1. M/s Allied Resins & Chemicals Limited was a listed company with BSE, NSE & CSE and your company is in the process of listing as per the scheme of the Calcutta High Court as well as terms and conditions imposed by BSE Vide their letter Ref: DCS/AMAL/SKS/24(f)/246/2010-11 dated June 4,2010 and further Company has also applied for de-materialization of shares with CDSL and NSDL and expected to get their permission at the earliest. TAXES AND DUTIES The Company has contributed Rs 280.44 Lacs to the Central and State Exchequer by way of Central Excise, Sales Tax etc. OPPORTUNITIES, CONCERNS & THREATS The year witnessed a revival of chemical industry in the domestic and international markets. The demand for Formaldehyde and Resin has gone up in the local as well as international markets despite high volatility in the international crude prices which directly impact the prices of the downstream chemical products. We expect some imbalance in the availability of raw materials, however, we do not foresee any problem in procuring the required raw materials from available sources. FUTURE PROSPECTS The Resins Industry is growing very fast in the Indian Economy and the growth rate is expected to increase further in the near future. Your Company is a part of the growing Indian economy, and is doing well in its operations. It is also expected the company would do well in the current financial year and in the years to come. INTERNAL CONTROL SYSTEM The Company has an adequate system of internal controls to safeguard its resources. All transactions are properly authorized, recorded and reported to the management. HUMAN RESOURCE DEVELOPMENT/INDUSTRIAL RELATIONS Industrial Relations remained cordial during the year despite occasional suspension of work during the year. The Directors acknowledge the support and co-operation from the employees and workers at all levels during the year. CAUTIONARY STATEMENT Statements made in this report describe the Companys objectives , precautions and estimates and are stated as required by applicable laws and regulations. Actual Result may vary or differ from those expressed or implied. Important developments could affect the Companys operations including market conditions, settlement of debts with lenders, Government Regulations,Exchange Rate Fluctuations. Rehabilitation Scheme by BIFR, Interest and other costs.