rayban sun optics india ltd Management discussions

RAYBAN SUN OPTICS INDIA LIMITED ANNUAL REPORT - 2007 MANAGEMENT DISCUSSION AND ANALYSIS Pursuant to Clause 49 of Listing Agreement, the Management Discussion and Analysis Report is as under: (i) Industrial Structure and development With the entry of organized professionally run optical chains with national distribution reach, the industry is undergoing a transition from stand alone single owner shops to regional and national chains. (ii) Opportunities and Threats Increasing visibility of Lifestyle Brands coupled with growing purchasing power of individuals is expected to posivitely impact the future prospects of this business in the medium term. The increasing proliferation of counterfeits continues to plague the eyewear industry in the country. Many of these counterfeits have non-optical quality glasses which are harmful to unsuspecting consumers besides causing a revenue loss to the government, retailers and the manufacturers. (iii) Segment-wise or product-wise performance All the different categories - core, fashion and luxury - grew satisfactorily in 2007. The new collections of RayBan were well received by customers and this has been reflected in the sale growth. (iv) Outlook, risks and concerns Going forward, as disclosed above, the fashion and luxury brands other than Ray-Ban are no longer available for distribution. Ray-Ban, the flagship brand of Luxottica Group and one of the worlds best known premium sunglass brand is expected to exhibit steady growth in sales and profit. (v) Internal control systems and their adequacy The Company has carried out an internal audit covering all key processes, and has in place adequate internal controls. (vi) Financial performance with respect to operational performance The company recorded a profit after tax of Rs. 17.30 Crores. The profit growth has been significantly higher due to sales growth. (vii) Material developments in Human Resources There is no significant development to report on the human resource front. The employee strength of the Company, as on 31st December 2007, was 175. The Company enjoys a harmonious relationship with its employees, including the workmen at its Plant in Bhiwadi, Rajasthan.