COMPANY OVERVIEW:
Our Company was incorporated as M K Proteins Limited under the provisions of the
Companies Act, 2013 vide certificate of incorporation dated June 15, 2012 in Ambala,
Haryana. It is a manufacturing and trading organization having its production/refining
plant of Edible Oils. Our manufacturing process involves refining of Crude Oils to obtain
Refined Rice Bran Oil, Canola Oil, Soya Bean Oil, Sunflower Oil and Rice Bran Bleached
Oil. During the refining process certain by- products are also manufactured such as Rice
Bran Fatty Acid Oil, Rice Bran Wax, Gums and Spent Earth which are also saleable. Further,
we also import crude oils, process them and sell the finished product. We also trade in
both edible and non-edible oils. Our company is focused at production of highest quality
of edible oil. Our refinery is completely mechanized and today we produce rice bran oil,
sunflower oil etc with protein content, with controlled fiber free from oil residue, ash
and sand & silica. This is possible only through sustained levels of cleaning, storage
and monitoring arrangements. Our Company based on its extensive experience of its
promoters and its standards, conforms to major specifications and customer requirements.
We firmly believe in benchmark product quality, customer centric approach, people focus,
ethical business practices.
COMPANYS OUTLOOK AND OPERATIONAL PERFORMANCE:
The first half of the year witnessed price volatility in the edible oil market, leading
to decreased demand for edible oil and impacting our volume growth. However, in the second
half, we successfully revived our business volumes. This was attributed to a decline in
edible oil prices, increased out-of-home consumption during festivals and weddings, and
improved direct coverage in both urban and rural areas. The inflationary trend in edible
oil prices resulted in consumers downtrading from premium products, affecting our margins.
Nevertheless, we focused on expanding the distribution reach of our brands of oils,
capturing the demand at more affordable price points.
INDIAN OVERVIEW
The branded edible oil market is estimated to be around H1,56,000 cr and is expected to
grow faster than the overall category gaining a lions share of close to 90% of the total
market in terms of value in the coming five years. It is estimated that close to 75% of
the total edible oil available in terms of volume is retailed as a branded product. The
edible oil industry in India is fragmented wherein 13% of oil is sold as loose/unbranded
and the consumers are shifting to branded oils, which bodes well for the organised
players.
The four key edible oils, palm, soya, mustard and sunflower constitute 85-88% of the
totaL consumption in India in terms of volume. Palm oil is primarily used by the
large-scale food processing enterprises. It is also used in blended oils for domestic
consumption.
India imports most of its palm oil consumption. Soybean oil, mustard oil and sunflower
oil is largely used for domestic consumption. The other oils include sesame oil, coconut
oil, groundnut oil, rice bran oil amongst others.
A gradual shift is being witnessed in favour of soft oils such as soyabean oil,
sunflower oil, mustard oil.
Consumption in rural India constitutes almost 50% of the total consumption in this
category by volume.
GLOBAL OVERVIEW
Growing demand for organic edible oil and rapid growth and expansion in the food sector
is expected to enhance the growth of the edible oil market. Canola oil is a healthier and
cheaper alternative to olive oil because of its lowest fat content, around 6 percent among
all other type of edible oils. As a result of various benefits of edible oil, an increase
in the demand for this oil ultimately drives the market growth.
Data Bridge Market Research analyses that the edible oils market is expected to reach
USD 190.88 billion by 2030, which is USD 102.37 billion in 2022, registering a CAGR of
8.10% during the forecast period of 2023 to 2030. In addition to the insights on market
scenarios such as market value, growth rate, segmentation, geographical coverage, and
major players, the market reports curated by the Data Bridge Market Research also include
in-depth expert analysis, geographically represented company-wise production and capacity,
network layouts of distributors and partners, detailed and updated price trend analysis
and deficit analysis of supply chain and demand.
STRENGTHS. WEAKNESSES. OPPORTUNITIES AND THREATS ASWOT ANALYSIS!
STRENGTHS
We believe that the following strengths have contributed to success and will be
competitive advantages for us, supporting our strategy and contribution to improvements in
financial performance:
* Our promoters have vast experience in the Edible Oil industry and have always
believed in maintaining the best quality in our products. Our Company is dedicated towards
quality of our products which has helped us to maintain long term relations with our
customers and has also facilitated us to entrench with new customers.
* Along with experienced promoters, our company has a team of employees and workers who
assist the top management, having knowledge and expertise of core aspects of Edible Oil
industry and marketing. We believe that our experience, knowledge and human resources will
enable us to drive the business in a successful and profitable manner.
* Our product portfolio consists of wide range of products which differentiate us from
other companies. We have product portfolio ranging from Rice Bran Oil, Sunflower Oil,
Canola Oil, Soyabean Oil etc,
WEAKNESSES
The annual oilseed production of the country is faced with high degree of variation as
nearly 76% of the oilseeds area is under rainfed conditions and therefore subjected to
uncertainties of moisture availability. Availability of quality seeds of improved
varieties and hybrids is grossly inadequate and is one of the major constraints in
enhancing the oilseed production. In oilseeds, the farmers are using predominantly the
saved seeds, resulting in about 80% of the area sown with farm saved seeds of old and
obsolete varieties. It has been proved beyond doubt that quality seed can alone increase
yield to the extent of 25-30% over old and obsolete varieties. With the exception of
sunflower and castor, the seed production of oilseeds is primarily left with public sector
agencies due to bulky nature of oilseed crops, more investment on infrastructure and less
remuneration. Although there is enough breeder seed production in most oilseed crops,
further seed multiplication through foundation and certified stages are the key onstraints
for availability of quality seed material. To boost the productivity of oilseeds crops,
farmers need to have access to improved seeds of the right type, at the right time, at the
right place, at a reasonable price and with right-size seed package.
Indian processing industry suffers from several maladies like outdated technology,
lower rates of utilization of installed capacity, low oil recoveries and high unit costs.
Reservation of oilseeds output for small scale processing is depriving the farmers and
consumers of the benefits of lower costs of modern processing technology, while putting up
the costs for consumers.
OPPORTUNITIES
The rise in disposable income acts as a primary growth driver in the Global Edible Oil
Market. The retail segment is expected to drive the sales of edible oils on account of a
strong supply chain of edible oil products and an established chain of retail outlets.
Vegetable oil consumption has increased in developing countries due to increasing demand
from a growing population, a surging retail sector, and a rise in overall household
income.
Furthermore, increasing the fame of trans-fat-free soybean oil & canola oil as well
as promising preference for olive oil and altering dietary habits, improving living
standards, and increasing user preference for healthy edible oil are the supporting
factors in the development of the global market.
THREATS
In edible oil industry, pests and disease incidence is causing up-to 40% yield loss.
The biotic stresses challenge the expectation of high yield in most of the oilseeds crops
in spite of high yielding varieties under cultivation. The crop loss under poor soil
quality, wherein many of these crops are cultivated in rainfed conditions is immeasurable.
The farmers, who chose to apportion their land for oilseed crops, become victims of
circumstances and have only to break even at the end of the season. The dramatic decrease
in self-sufficiency over the five years is a clear indication that globalization has
already made an impact on oilseeds sector. The relative comparative advantage is less in
case of oilseeds and oils than other food crops. The productivity growth in case of five
major oilseeds of the country was a mere 0.5% over the previous decade. Oilseeds are grown
mostly on medium to poor soils in low rainfall areas. The area under irrigation is also
quite low in case of oilseeds. Over the last one decade, the irrigation coverage merely
increased by 3% from 23 to 26%.
Moreover imports of edible oils are also increasing. Industry stakeholders in India
have proposed increasing the duty differential between crude and refined oil to limit the
high volume of refined palm oil imports. However, the government is unlikely to raise
import duties on edible oils, despite the sharp decline in domestic cooking oil prices.
DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE The
financial statements have been prepared in compliance with the requirement of the
Companies Act, 2013 and Accounting Standards of India (AS). During the year under review,
the company reported profit of Rs. 14,60,41,232.81 before tax adjustments as
compared to profit of Rs. 14,04,21,364/-before tax adjustmentin the previous
year.
The companys revenue grew by 23% to INR 3,14,85,99,734.44 during FY2022-23 from
INR 2,55,88,86,606/- for the same period ending FY 2022-23. The growth was
attributed by higher volumes and better pricing scenario. Profit after tax (PAT)
registered an impressive growth of 4.5%.
The company does not have any other segments.
KEY FINANCIAL RATIOS
[Pursuant to Schedule V (B) to the Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015j:
| Financial Ratio |
FY 22-23 |
FY 21-22 |
% change |
Reasons for change |
| Debtors Turnover |
13.8 |
10.26 |
34.5% |
Because of early recovery of money from debtors and its rotation
compared to turnover |
| Inventory Turnover |
5.21 |
5.85 |
(10.9%) |
Not a significant change |
| Interest Coverage Ratio |
46.22 |
2.85 |
1521% |
The Companys current year profits are in comfortable position
leading to better support to repay debts |
| Current Ratio |
1.96 |
1.88 |
4.2% |
Not a significant change |
| Debt Equity Ratio |
0.05 |
0.07 |
(28.5%) |
Owing to issue of Bonus Shares, Debt Equity ratio has |
|
|
|
|
reduced significantly |
| Operating Profit Margin (V) |
6.36 |
7.10 |
(11.6 V) |
Not a significant changed |
| Net Profit Margin V |
3.38 |
3.98 |
(15V) |
Not a significant change |
| Return on Net worth |
4.01 |
2.88 |
(39.23 V) |
Due to increase in profits, the return on net worth has increased |
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Companys robust and intricate internal control systems ensure there is efficient
use and protection of resources and compliance with policies, procedures and statutory
requirements. There are well-documented guidelines, procedures and processes, integral to
the overall governance, laws and regulations. All the Companys major business processes
are well integrated. The Internal control systems of the Company are effective and
adequate, commensurate with the size and complexities of its operations. These have been
designed to provide reasonable assurance with regard to recording and providing reliable
financial and operational information, complying with applicable statutes, safeguarding
assets from unauthorized use, executing transactions with proper authorization and
ensuring compliance of corporate policies.
Based on its evaluation (as defined in section 177 of Companies Act 2013), our audit
committee has concluded that, as of March 31, 2023, our internal financial controls were
adequate and operating effectively.
HUMAN RESOURCE MANAGEMENT:
Human resource management plays a critical role in the Companys growth., Our
operations needs qualified and trained staff for these operations. The Company undertook
regular training programs to create awareness and enhance the skills of the employees. The
Company believes in periodical trainings, incentives, increments and other welfare
measures to ensure healthy industrial relations.
The company has taken efforts to set up and maintain an efficient work force. The
company is taking steps towards maintaining a low attrition rate which it believes can be
achieved by investing in learning and development programmes for employees, competitive
compensation, creating a compelling work environment, empowering employees at all levels
as well as a well-structured reward and recognition mechanism.
The Company had 30 employees as on March 31, 2023.
For M K Proteins Limited Parmod Kumar Managing Director (DIN: 00126965)
+91-9892691696
