AKG Exim Ltd Management Discussions.

ANNEXURE "V" TO THE BOARD REPORT

This Management Discussion and Analysis report has been prepared in compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and contains expectations and projections about the strategy for growth, product development, market position, expenditures and financial results. Certain Statements in the Management Discussion and analysis report are forward looking statements which involve, a number of risks and uncertainties that could differ actual results, performance or achievements with such forward looking statements on the basis of any subsequent development, information or events for which the Company do not bear any responsibility.

GLOBAL ECONOMY:

The global economy contracted by 3.3% in CY 2020, as all major economies barring China slipped into recession with COVID-induced lockdowns. Advanced Economies (AE) decline of 4.7% was steeper than Emerging Markets (EM) decline of 2.2%. Within the AE complex, the decline in Euro Area (-6.6%) was much sharper than that in the US (-3.5%). Within the EMs, Chinas GDP grew 2.3%. Despite the steep global decline in CY 2020, global GDP decline was lower than initially feared primarily due to unprecedented monetary policy support from global central banks and fiscal stimulus from governments. Global fiscal stimulus reached ~US$18.6 trillion by March 2021 (23% of GDP) while monetary stimulus by global central banks reached US$16.6 trillion (21% of GDP). Global trade volume (goods and services) contracted by 9.6% in CY 2020 after a modest 1% increase in CY 2019. Global trade also started recovering in 4Q FY 2021 as merchandise trade volume turned positive on y-o-y basis from November 2020. Global trade is forecast to grow 8% in CY 2021 with merchandise volumes recovering faster than services volumes.

Indias Economic Performance in 2020-21:

• Indias real GDP to record a 11.0% growth in FY2021-22 and nominal GDP to grow by 15.4%.

• India expected to have a Current Account Surplus of 2% of GDP in FY21, a historic high after 17 years.

• India remained a preferred investment destination in FY 2020-21 with FDI pouring in amidst global asset shifts towards equities and prospects of quicker recovery in emerging economies:

• Net FPI inflows recorded an all-time monthly high of US$ 9.8 billion in November 2020, as investors risk appetite returned.

• India was the only country among emerging markets to receive equity FII inflows in 2020.

• V-shaped recovery is underway, as demonstrated by a sustained resurgence in high frequency indicators such as power demand, e-way bills, GST collection, steel consumption, etc.

• India became the fastest country to roll-out 10 lakh vaccines in 6 days and also emerged as a leading supplier of the vaccine to neighbouring countries and Brazil.

• India adopted a four-pillar strategy of containment, fiscal, financial, and long-term structural reforms:

• Calibrated fiscal and monetary support was provided, cushioning the vulnerable in the lockdown and boosting consumption and investment while unlocking.

• A favourable monetary policy ensured abundant liquidity and immediate relief to debtors while unclogging monetary policy transmission.

• Innovation

• India entered the top-50 innovating countries for the first time in 2020 since the inception of the Global Innovation Index in 2007, ranking first in Central and South Asia, and third amongst lower middle-income group economies.

INDUSTRY STRUCTURE AND DEVELOPMENT

"There were already signs of an impending slowdown in the economy, which have been sharply accentuated by the COVID-19 pandemic induced lockdown. The spread of COVID-19 pandemic has severely hit global as well as domestic growth".

INDIAN AGRICULTURE INDUSTRY ANALYSIS

India has the second-largest arable land resources in the world. With 20 agri-climatic regions, all the 15 major climates in the world exist in India. The country also has 46 of the 60 soil types in the world. India is the largest producer of spices, pulses, milk, tea, cashew, and jute, and the second largest producer of wheat, rice, fruits and vegetables, sugarcane, cotton, and oilseeds. Consumer spending in India will return to growth in 2021 post the pandemic-led contraction, expanding by as much as 6.6%. Total area sown with rabi crops was 34.8 million hectares by November 27, 2020, 4% more than the previous season, and 2% above the average of the last five years. According to the Ministry of Agriculture, 44% of wheat and other rabi crops were harvested out of a total of 97 lakh hectares sown area in the 2020-21 rabi season.

Production of horticulture crops in India reached a record 326.6 million metric tonnes (MMT) in 2020-21 (an increase of 5.81 million metric tonnes over FY20. The production of fruits, flowers, spices and honey is expected to rise. India has the largest livestock population of around 535.78 million, which translates to around 31% of the world population. Milk production in the country is expected to increase to 208 MT in FY21 from 198 MT in FY20, registering a growth of 10% y-o-y.

The principal commodities that posted significant positive growth in exports between FY20 and FY21 were the following:

1. Wheat and Other Cereals: 727% from Rs. 3,708 crore (US$ 505 million) to Rs. 5,860 crore (US$ 799 million)

2. Non-Basmati Rice: 132% from Rs. 13,130 crore (US$ 1,789) to Rs. 30,277 crore (US$ 4,126 million)

3. Soya Meal: 132% from Rs. 3,087 crore (US$ 421 million) to Rs. 7,224 crore (US$ 984 million)

4. Raw Cotton: 68% from Rs. 6,771 crore (US$ 923 million) to Rs. 11,373 crore (US$ 1,550 million)

5. Sugar: 39.6% from Rs. 12,226 crore (US$ 1,666 million) to Rs. 17,072 crore (US$ 2,327 million)

6. Spices: 11.5% from Rs. 23,562 crore (US$ 3,211 million) to Rs. 26,257 crore (US$ 3,578 million)

Gross Value Added by agriculture, forestry, and fishing was estimated at Rs. 19.48 lakh crore (US$ 276.37 billion) in FY20. Share of agriculture and allied sectors in gross value added (GVA) of India at current prices stood at 17.8 % in FY20.

(Source: https://www.ibef.org/industry/agriculture-presentation )

METALS AND STEELS:

In India, as per Indian Steel Association (ISA), steel demand is estimated to grow 7% in FY20 and FY21. In FY20, crude steel production and finished steel production in India was 108.5 MT and 101.03 MT, respectively. Between April 2020 and February 2021, Indias cumulative production of finished steel stood at 85.60 MT while the cumulative production of crude steel stood at 92.78 MT.

Steel companies are looking to restart expansion projects on the back of burgeoning steel processes with a capacity addition of 29 MT. In April 2021, Indias finished steel consumption stood at 6.78 MT. Also, during the period April 2020 to February 2021 the crude steel production stood at In November 2020, the Steel Authority of India Limited (SAIL) reported 7% YoY growth in crude steel production. Export and import of finished steel stood at 8.42 MT and 6.69 MT, respectively, in FY20.

Export and import of finished steel stood at 9.49 MT and 4.25 MT, respectively, between April 2020 and February 2021

In 2021, Indian Railways is planning to procure over 11 lakh tons of steel from Steel Authority of India Limited (SAIL) for the track renewal and laying new lines across the country.

In January 2021, the Ministry of Steel, Government of India, signed a Memorandum of Cooperation (MOC) with the Ministry of Economy, Trade and Industry, Government of Japan, to boost the steel sector through joint activities under the framework of India Japan Steel Dialogue.

Iron ore production in the country stood at 189 million tonnes in FY21.

In FY20, India had a total number of 914 steel plants producing crude steel. In FY21, Indias crude steel production stood at 102.49 million tonnes.

Production of aluminium stood at 3.65 MT in FY20. In value terms, aluminium export from the country stood at US$ 20.18 million in FY20.

India holds a fair advantage in cost of production and conversion cost of steel and alumina. India became the worlds second-largest crude steel producer in 2019 with production at 111.2 MT. Crude steel production and finished steel production stood at 108.5 MT and 101.03 MT, respectively, in FY20. In FY20, India had a total number of 914 steel plants producing crude steel.

OUTLOOK

Our Company is in the Line of Business of Import/ Export or Trading of following products and also deals in Engineering / Technical Consultancy or Indenting / Commission or Business Consulting Services of:

1. Metal Scrap - The Company offers a wide range of scrap metals viz. HMS (Heavy Melting Scrap), aluminum scrap, stainless steel scrap, copper scrap, brass scrap, etc. The company also deals in ferrous Scrap, non-ferrous Scrap and reusable items. It procures metal scrap originating from USA, West African and European countries, and sells these products in the domestic market all over India.

2. Spices & Dry Fruits - The Company Locally trade in Dry Fruits and spices in domestic local market.

3. Non-Basmati Rice The Company is in Trading of all types of non-basmati rice locally. Procurement is from domestic market and sale is also in domestic market.

We have developed a sustainability mission for our company which can be briefed in three words (reduce-reuse-recycle).

BUSINESS OVERVIEW

The turnover during the year 2020-21 has touched of Rs. 78,87,49,247/- approx. excluding the other income.

MARKETING

The Company has already set up a good marketing team as it is evident from turnover.

INTERNAL CONTROL

The Company has an internal control system, commensurate with the size of its operations. Adequate records and documents were maintained as required by laws. The Companys audit Committee reviewed the internal control system. All efforts are being made to make the internal control systems more effective.

CONSOLIDATED SEGMENT WISE REPORTING

During the year under review, Company has achieved all sales under Segment B i.e., Trading only.

Name of the segments dealed by the Company during the year 2020-21:

1. Segment A: Manufacturing (Under Process)

2. Segment B: Trading

RISKS AND CONCERNS

In any business, risks and prospects are inseparable. As a responsible management, the Companys principal endeavor is to maximize returns. The Company continues to take all steps necessary to minimize losses through detailed studies and interaction with experts.

CAUTIONARY STATEMENT

Statement in this Managements Discussion and Analysis detailing the Companys objectives, projections, estimates, expectations or predictions are "forward-looking statements" within the meaning of applicable securities 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 global and Indian demand-supply conditions, feedstock availability and prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the Company conducts business and other factors such as litigation and labour negotiations.

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has followed all the treatments in the Financial Statements as per the prescribed Accounting Standards.

By Order of the Board of Directors
For AKG Exim Limited
Sd/- Sd/-
RAHUL BAJAJ MAHIMA GOEL
EXECUTIVE DIRECTOR MANAGING DIRECTOR
DIN:03408766 DIN: 02205003
Place: Gurugram
Date: 13.08.2021