Pursuant to the regulation 34 read with the Schedule V of the SEBI
(Listing obligations and Disclosures Requirements) Regulations, 2015 youre Directors wish
to report as follows:
A. INDUSTRY STRUCTURE AND DEVELOPMENTS Industry Profile (Structural
Steel )
India has emerged as the fastest-growing major economy in the world and
is expected to be one of the top three economic powers in the world over the next 10-15
years, backed by its robust democracy and strong partnerships.
Indias nominal gross domestic product (GDP) at current prices is
estimated to be at H232.15 trillion (US$ 3.12 trillion) in FY22. India is the
third-largest unicorn base in the world with over 100 unicorns with a total valuation of
US$ 332.7 billion. India needs to increase its rate of employment growth and create 90
million non-farm jobs between 2023 and 2030s, for productivity and economic growth
according to McKinsey Global Institute. The net employment rate needs to grow by 1.5% per
year from 2023 to 2030 to achieve 8-8.5% GDP growth between 2023 and 2030. According to
data from the Department of Economic Affairs, as of January 28, 2022, foreign exchange
reserves in India reached the US$ 634.287 billion mark.
Recent economic developments in India are as follows:
With an improvement in the economic scenario, there have been
investments across various sectors of the economy. The private equity - venture capital
(PE-VC) sector recorded investments worth US$ 5.8 billion across 117 deals in February
2022, 24% higher than in January 2022. Some of the important recent developments in the
Indian economy are as follows:
Indias merchandise exports were at an all-time high of US$ 417.81
billion in FY22. In April 2022, the Manufacturing Purchasing Managers Index (PMI) in
India stood at 54.7.The gross Goods and Services Tax (GST) revenue collection hit an
all-time high of H1.68 trillion (US$ 21.73 billion) in April 2022. This is a 20% increase
over the previous year.According to the Department for Promotion of Industry and Internal
Trade (DPIIT), FDI equity inflow in India stood at US$ 572.80 billion between April
2000-December 2021. Consumer Price Index (CPI) - Combined inflation was 5.20% in 2021-2022
(April-December) against 6.6% in 202021 .Foreign portfolio investors (FPIs) invested
H50,009 crore (US$ 6.68 billion) in the Calendar year 2021.
GLOBAL SCENARIO FOR STEEL SECTOR
Steel is always a hot commodity in the global market, but the demand
for steel has increased by record amounts over the past two years, and shortages are
causing market issues. Many buyers have expressed their concern about having enough steel
for production needs in 2022. The current shortages are due to supply chain issues that
have impacted steel inventory, increasing demand. As a result of the spread of COVID-19
over the past two years, mill outages and transportation blockages have also led to a
steel shortage. The Russia Ukraine war further added to global steel supply chain
disruptions leading to higher shortage of steel. Various countries in the world have
imposed restrictions due to new COVID-19 variant Omicron in 2022. Growth prospectus in
steel industry has been adversely affected due to slow down of real estate sector in
China, reduced global per capita consumption of steel and ongoing Russia-Ukraine war. In
view of the above factors the Global growth is envisaged to be reduced from an estimated
6.1% in 2021 to 3.6% in 2022. While China continued to be the largest global crude steel
producer, there were moderate growth in steel production in countries such as India,
Japan, USA, Germany, and Brazil, amongst others, signifying normalcy in operations during
the pandemic.
Growth Projections
In 2021, the growth in steel demand increased by 4.5 percent, up from
just 0.1 percent in 2020. The World Steel Association (WSA) a projected 2.2 percent growth
in the demand for steel in 2022, so demand will continue to increase. Things are slowly
swinging back in the right direction, according to this forecast. The 2.2 percent growth
assumes vaccinations will continue worldwide, which will halt the spread of new COVID
variants, so the virus should be less damaging to the global market. However, the
increasing inflation may have impact on steel demand growth.
OPPORTUNITIES FOR GROWTH OF IRON AND STEEL IN PRIVATE SECTOR The New
Industrial Policy Regime:
The New Industrial policy opened up the Indian iron and steel industry
for private investment by (a) removing it from the list of industries reserved for public
sector and (b) exempting it from compulsory licensing. Imports of foreign technology as
well as foreign direct investment are now freely permitted up to certain limits under an
automatic route. Ministry of Steel plays the role of a facilitator, providing broad
directions and assistance to new and existing steel plants, in the liberalized scenario.
The Growth Profile
(i) Steel: The liberalization of industrial policy and other
initiatives taken by the Government have given a definite impetus for entry, participation
and growth of the private sector in the steel industry. While the existing units are being
modernized/expanded, a large number of new steel plants have also come up in different
parts of the country based on modern, cost effective, state of-the-art technologies. In
the last few years, the rapid and stable growth of the demand side has also prompted
domestic entrepreneurs to set up fresh greenfield projects in different states of the
country. Crude steel capacity was 154.23 mt in 2021-22 (provisional), and India, which was
the 2nd largest producer of crude steel in the world in 2021, as per rankings released by
the World Steel Association, has to its credit, the capability to produce a variety of
grades and that too, of international quality standards.
GLOBAL SCENARIO FOR FOOD SECTOR
The global ready-to-eat food market is expected to grow at a CAGR of
4.89% between 2022 and 2027. Ready- to-eat food giants are being driven by young
consumers, increased Asian female workforce, enhanced incomes, wider cuisine options,
urbanization and need for leisure, increase in the willingness to spend coupled with the
lack of time to cook at home. Moreover, the growing millennial and working women
population is also fuelling the overall demand for ready to eat food market. The global
ready- to-eat food market generated revenues of around US$0.51 trillion in 2022 and is
expected to grow 3.6% in 2023. The average volume per person in the ready-to-eat meals
segment was placed at 10.3 kg in 2022. (Source: Modor Intelligence, Statista, Data Bridge)
Industry drivers
Growing demand for healthier lifestyle and eating habits are driving
the demand for nutritious and quality food.
W Nuclear families: Even as Indias population continues to grow, the
average household size continues to decline - from 5.5 persons in 1999 to 4.4 persons in
2020. Nuclear households with children purchase 19% more fast-food meals and 38% less
full-service restaurant meals than households without children. In addition, single
parents, who do not have a partner to help out with childcare, prefer to purchase 24% more
ready-to-eat foods than all other households. (Source: Sidmartin Bio)
W Packaging standards: The global food packaging market is expected to
grow from $338.34 billion in 2021 to $478.18 billion in 2028 at a CAGR of 5.1% during
2021-2028. Improvement in the packaging quality has extended the shelf life of products,
enhancing convenience.
W Food safety: Increasing health awareness among consumers and a rising
adoption of vegetarian and vegan lifestyles, particularly in developed regions, have led
to a growing demand for organic foods and non-GMO ingredients (grains, seeds and fruit).
W Ready to eat food: Globally, millennials account for roughly 23% of
the worlds population or 1.8 billion people. Indias millennial population accounts for
34% or 440 million people, enhancing the popularity of convenience foods and ready-to-eat
foods. Busier lifestyles, growing incomes, increased nuclear families and dearth of
cooking skills are catalysing growth of the ready-to-eat meals segment.
W Healthy diet: Consumers increasingly seeking plant-based foods are
driving traction for clean and sustainable food products.
Impact of Covid-19: Ready-to-eat food products reported demand growth
during the COVID-19 pandemic with most people working from home.
W Packaged e-commerce foods sector: E-commerce accounts for less than
5% of total retail sales in Indias packaged foods industry, which is likely to change.
The Indian online grocery market stood at USD3.95 billion in FY2021 and expected to grow
at a CAGR of around 33% to USD26.63 billion by FY2027, influenced by consumer preferences,
increasing disposable incomes, new market entrants and attractive marketing strategies
(Source: Statista, Livemint)
Government initiatives
The Indian government has encouraged private sector investments for
promoting value-addition in agricultural and allied sectors. The Government of India aims
to boost growth in the food processing sector through reforms like 100% foreign direct
investment in the marketing of food products and various incentives at the central and
state government level along with a strong focus on supply chain infrastructure. The
Indian Finance Minister implemented a scheme of Rs.10,000 Cr. to help 200,000 Micro Food
Enterprises (MFE) with a view of vocal for local with global outreach. The government
launched the One District One Product program to upgrade SMEs in select products through a
creditlinked subsidy of 35% of the eligible project cost limited to a maximum Rs.10 lakhs.
(Source: Times of India)
The Government of India launched a Production-Linked Incentive Scheme
for the Food Processing Industry (PLISFPI) to strengthen food production commensurate with
Indias natural resource endowment. The government of India is expected to support the
sector with PLI spending of Rs.10,900 crore for five years till 2026-27. This scheme will
accelerate production capacity growth to generate processed foodoutput of Rs. 33,494 crore
and create employment for nearly 250,000 persons by 2026-27. (Source: Ministry of Food and
Processing Industries)
Company Overview
Shri Bajrang Alliance Limited is being recognized as one of the largest
structural Rolling Mill in the state of Chattisgarh spread over 6.5 acres of land. The
products of the Bajrang Alliance are a model for other rolling mills in the country.
Bajrang Alliance plays on important role in the National effort to build a strong and
self-reliant industrial base. Shri Bajrang Alliance Limited has been commissioned by
adopting the most modern and advanced technology.
Under its banner Shri Bajrang Alliance Limited, the Group has now
launched GOELD, an addition to its illustrious accomplishments. GOELD marks the foray of
Goel Group into the foods business with its 100% vegetarian frozen food products. While
aiming to modernise the retail environment in India, the brand is all set to define the
gold standard in the packaged food industry.
In the course of time, GOELD intends to advance into supercritical
oils, nutraceuticals and straddle the entire gamut of retail foods.
Company is a market leader in the ready-to-eat food, ready-to-cook
food, frozen food, frozen vegetables. The Company had also forayed in Natural oils,
Oleoresins and Natural Food Supplements domains. The Company has been continuously
endeavouring towards catering to changing consumer needs by developing newer products
under diff erent categories. The Company has a dedicated team of professionals engaged in
understanding the developments and bringing out innovative products. This year, the
Company has launched new products under GOELD brand like Veg Spring Rolls, Punjabi Samosa,
Vegetable Samosa, Cheesy Panner Samosa , Vegetable Burger Patty and extended its current
product line.The Company has one state of the art manufacturing plants located in Raipur,
ChhattisgarhThe Raipur plant is spread across 5 Acres.BRC (British Retail
Consortium)accredited.
Financial highlights
On a Consolidated basis the Revenue for the current financial year
stood at Rs. 17265.16 Lakhs as compared to Rs. 21409.67 Lakhs in the previous year and
Profit after Tax stood at Rs. 7206.82 Lakhs during the current financial year as compared
to Rs. 3078.69 Lakhs in the previous year.
On a Standalone basis the Revenue for the current financial year stood
at Rs. 17261.26 Lakhs as compared to Rs 21405.77 Lakhs in the previous year and Profit
after Tax stood at Rs. 378.33 Lakhs during the current financial year as compared to Rs.
217.54 Lakhs in the previous year.
B. OPPORTUNITIES AND THREATS Strenght
W Wide range of products catering to varied tastes and preferences W
Well established brands across geographies W Experienced management
W Strong overseas distribution network that allows wide reach and
coverage in target markets. Opportunities
Rising demand for prepared food due to busy lifestyle, nuclear families
and changes in consumer preferences provide good growth opportunities.
New categories and products based on new consumer trends.
Aspirations
The new segment of Agency distribution would drive further growth W
Continuous product innovation.
W Continued focus on export markets.
W Deepen presence across existing geographies and target new ones.
Results
One of the leading players in prepared ethnic food market
W Maintaining the wide range of products with focused customer
satisfaction and high quality range W Maintaining healthy growth and profitability.
Risk and Mitigation
W Raw material inflation risk: Any rise in raw material costs could
affect competitiveness and margins.
Mitigation: The Company monitors strategic and bulk purchases; its
stable supply chain has helped ensure continuous raw material supply
at pre-determined costs.
W Competition risk: Growing competition (existing and new) and
unorganised companies could affect market share.
Mitigation: ADFs longstanding investment in a strong brand portfolio
sustained consumer traction and protected market share.
W Increased freight rates: During FY 2021-22, there was a steep
increase in freight cost, affecting margins.
Mitigation: The Company is evaluating the opportunity of entering into
annual freight contracts; the freight cost is partially transferred to the distributors.
C. FUTURISTIC STATEMENT
Companys performance as expressed or implied could differ materially
due to economic conditions affecting demand/ supply and price condition in the domestic
& overseas markets, changes in the Government regulations, tax laws & other
incidental factors.
D. CHALLENGES RISKS AND CONCERNS
The banking system continues to be over burdened with large Non
Performing Assets (NPA) restricting the investment by Public and Private Corporate
Sectors. Margins in the industry continue to be under pressure due to severe competition.
We are up-grading our skills, modernization and cost saving to the extent possible. Risk
and concerns are being addressed on a continuous basis
RISK MANAGEMENT
Risk is an integral factor in virtually all businesses. At SBAL, risks
are adequately measured, estimated and controlled. Irrespective of the type of risk or the
activity that creates it, the Companys fundamental approach to risk management remains
the same: identify and measure risks, leverage an in-depth knowledge of the business and
competitors and respond flexibly in the understanding and management of risks.
E. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Recognising and tracking the internal control systems is a critical
part in an organization. The company has a secured system of internal controls which works
together with internal financial controls that are repeatedly administered by the
management. The internal control system of the Company shows proficiency in operations;
make the best use of resources and adhere with all applicable laws and regulations. Key
controls are examined during the year and restorative and precautionary actions are taken
for any fault. Internal audits are organized systematically by designated audit teams. The
Audit Committee sanctions the risk based internal audit plan which also reviews worth and
efficacy of the Companys internal financial controls.
F. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS
FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED.
HUMAN RELATIONS
Human resources are considered as one of the most valuable asset in
forming the organization structure of the Company. The Human resources development process
of the Company promotes co-operation and innovation among the employees, within the
organization which provides flexibility to keep in pace with the changing business needs
of the Company and in retaining our personnel.
We have an elaborate performance management system in place involving
goal setting and periodic reviews involving confirmation and annual reviews. The review
sessions impress upon several aspects of the professionals careers such as career and
competency development, financial rewards and recognition. We endeavor to link careers to
competencies, individual preferences and organizational needs.
The Company endeavors to make all possible efforts for developments in
Human Resources, including number of people employed and in Industrial Relations front.
There is no material development in human resources with respect to number of people
employed.
SAFETY
Safety management is integrated with the Companys overall environment,
health and safety (EHS) management and zero accident is taken up as the Companys goal.
The following measures have been taken by the Company:
W Identification of hazard and risk present in the work environment and
its rectification.
W Continuous monitoring of unsafe conditions and unsafe acts through
safety inspections.
W Specific job safety awareness on a continuous basis.
ENVIRONMENT FRIENDLY OPERATIONS
Environmental protection is prime concern for us and we are aware of
our core responsibility to the society. The Companys plant complies with all norms set up
for clean and better environment by the competent authorities. The Company undertakes
regular checks / inspection for the maintenance of environment, health and safety. The
company has adequate effluent treatment equipments to avoid pollution. The Company is
continuously endeavoring to improve the quality of life in the community surrounding its
industrial complex.
D. CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis describing the
Companys objectives, expectations or predictions may be forward looking within the
meaning of applicable laws and regulations. Actual results could differ materially from
those expressed or implied. Important factors that could make a difference to the
Companys operations include raw material availability and prices, cyclical demand and
pricing in the Companys principal markets, competitive actions, changes in Government
regulations, tax regimes, economic developments in India and in countries in which the
Company conducts business and other incidental factors.
|
FOR, SHRI BAJRANG ALLIANCE
LIMITED |
| RAIPUR, 31.05.2022 |
Sd/- |
|
NARENDRA GOEL (CHAIRMAN) |
|
DIN:00115883 |
+91-9892691696
