allied computers international asia ltd share price Management discussions

INDUSTRY OVERVIEW

Country has identified electronics manufacturing as a key sector for future economic growth, India has seen an increase in imports of electronic goods and laptops/computers in the last few years. During April-June this year, the import of electronic goods increased to $6.96 billion from $4.73 billion in the year-ago period, with a share of 4-7 per cent in overall imports.

The highest share of imports is in the category of personal computers including laptops, and palmtops, under which imports from China stood at $558.36 million in April-May this year as against $618.26 million in the year-ago period. China accounts for roughly 70-80 per cent of the share of India’s imports of personal computers, laptops.

India’s PC market declined by 30% year-on-year in the first quarter of 2023 to about three million units, according to research published by IDC in May 2023.

The consumer segment experienced a 36.1% year-on-year downturn, primarily due to slowing demand and low market sentiment, while the commercial segment declined 25.1% due to reduced and delayed procurement by enterprises and SMEs. Additionally, all of the five companies with the biggest share of the Indian PC market saw a year-on-year decline during the quarter, with Dell Technologies experiencing the biggest slump in the region, seeing its unit shipments drop by 49.8%. “PC demand has been sluggish over the last couple of quarters,” said Navkendar Singh, Associate vice president, of devices research, IDC India, South Asia & ANZ, in comments published alongside the research.

BUSINESS OVERVIEW:

The Company main activities is manufacturing of Notebook & servicing of all brands of computers, laptop, tab, etc. The Company is low cost specialist repair services for all brands of laptop/iPod & notebook in India. The Company expects better profit margin as it is veteran in servicing all brands o f Computers, laptop, tab, etc. and it has targeted customers based in western part of India. The Company is in process of tie-up with v arious vendors to trade their p roducts through the Company platform, which can easily penetrate into Tier II &

Tier III towns/cities of India. It is working with some of the vendors in other than western part of India, to broad base its customer reach. The Company has been able to double its profit compare to last year, whereas turnover has increased by over 5 times compared to last year as the Company faces heavy completion from organized/unorganized sectors & from China, both in terms of cost & wider customer based. To have all India level network, huge capital investment is required, which the Company may find difficult to rise. The new Government has initiated various projects, wherein more job opportunities have been created, thus resulting into more demands of laptop & notebook. The younger generations are more inclined towards laptop & notebook for higher data storing capacity, easy viewing, faster net surfing & handy to use. The growth in the sector is very good and Management expects better results in forth coming year. With the introduction of GST should see a level playing field between your company and other companies who are tax-exempt. The Company is exploring various options to improve margins of the Company, by having tight control on expenses & exploring various business activities. The Management of the Company is not able to quantify the economic impact of lock down and COVID-19 effect. As and when, it will be quantified, the Board will declare it.

BUSINESS PERFORMANCE AND SEGMENT REPORTING:

During the year under review, the company has gain profit of Rs. 0.58 Lakh as against loss of Rs. 1.53 Lakh during the previous year 2021-22. The profit margin of the Company is on a negative side on account of restricted territorial base; competition from Chinese products/unorganized sectors. Many new players have entered the market with huge funds & latest technology to capture the market. The company is engaged in the Notebook & servicing of all brands of computers, laptop, tab, etc. which as per Accounting Standard 17 is considered the only reportable business.

ADEQUACY OF INTERNAL CONTROL:

The Company has robust internal control systems in place which are commensurate with the size and nature of the business. The internal controls are aligned with statutory requirements and designed to safeguard the assets of the Company. The internal control systems are complemented by various Management Information System (MIS) reports covering all areas. Increased attention is given to auto generation of MIS reports as against manual reports to take care of possible human errors or alteration of data. The Management reviews and strengthens the controls periodically.

HUMAN RESOURCE DEVELOPMENT:

The Company recognizes the importance of Human Resource as a key asset instrumental in its growth. The Company believes in acquisition, retention and betterment of talented team players. With the philosophy of inclusive growth, the Company has redefined its performance management system. The new system focuses on progression of individual employees together with organizational goals. Under the new system increased thrust will be on job rotation and multiskilling.

MANPOWER:

The company recognizes the importance of human value and e nsures that proper encouragement both moral and financial is extended to employees to motivate them.

	By Order of the Board of Directors
	For Allied Computers International (Asia) Limited
	Sd/-
	Vidya Babu Rai
Place: Mumbai	Director
Date: 05/09/2023	DIN: 07984997