Amanaya Ventures Ltd Management Discussions

This chapter on Managements Discussion and Analysis ("MD&A") is to provide the stakeholders with a greater understanding of the Companys business, the Companys business strategy and performance, as well as how it manages risk and capital.

The following management discussion and analysis is intended to help the reader to understand the results of operation, financial conditions of Amanaya Ventures Limited.

1. ECONOMIC OVERVIEW, INDUSTRY STRUCTURE AND DEVELOPMENTS:

GLOBAL ECONOMIC REVIEW

The baseline forecast is for the world economy to continue growing at 3.2 percent during 2024 and 2025, at the same pace as in 2023. A slight acceleration for advanced economies—where growth is expected to rise from 1.6 percent in 2023 to 1.7 percent in 2024 and 1.8 percent in 2025—will be offset by a modest slowdown in emerging market and developing economies from 4.3 percent in 2023 to 4.2 percent in both 2024 and 2025. The forecast for global growth five years from now—at 3.1 percent—is at its lowest in decades. Global inflation is forecast to decline steadily, from 6.8 percent in 2023 to 5.9 percent in 2024 and 4.5 percent in 2025, with advanced economies returning to their inflation targets sooner than emerging market and developing economies. Core inflation is generally projected to decline more gradually. The global economy has been surprisingly resilient, despite significant central bank interest rate hikes to restore price stability. Chapter 2 explains that changes in mortgage and housing markets over the pre pandemic decade of low interest rates moderated the near-term impact of policy rate hikes. Chapter 3 focuses on medium-term prospects and shows that the lower predicted growth in output per person stems, notably, from persistent structural frictions preventing capital and labor from moving to productive firms. Chapter 4 further indicates how dimmer prospects for growth in China and other large emerging market economies will weigh on trading partners.

(Source: IMF World Economic Outlook, April 2024)

INDIAN ECONOMY REVIEW:

Indian Economic Review Indias underlying economic fundamentals remain strong and despite the short-term turbulences caused by the emergence of newer Covid variants, supply-chain disruptions, and rising inflation, the impact on the long-term outlook will be marginal. The results of growth enhancing policies and schemes such as production-linked incentives and increased infrastructure spending will start kicking in from 2023, leading to a stronger multiplier effect on jobs and income, higher productivity, and efficiency all leading to accelerated economic growth.

INDUSTRY REVIEW:

A structural change in the investment market

In India physical assets make up the most significant part of household savings; this includes real estate, and gold (and silver) bars, coins and jewelry. As a result, India has become the worlds second largest bar and coin market, consuming an average of 187t annually over the last decade (Chart 1). In essence, gold bars and coins play a diverse role in fulfilling investment demand. Metals Focus field research suggests that some 40-50% is eventually converted into jewelry. This means that investment products satisfy the dual role of savings while supporting jewelry purchases.

Drivers of gold investment demand

Some of the factors supporting bar and coin demand are similar to those that support jewellery demand. Weddings and religious occasions are important. Economic factors also drive bar and coin demand both in the long and short term. In the long term, investment demand is determined by income. All else being equal, an econometric model using annual data from 1990 to 2021, shows that for a 1% increase in gross national income per capita, bar and coin demand increases by 1.1%. With rising income levels, the allocation of Indian household savings to financial assets – such as banking deposits, insurance funds and mutual funds – has increased compared to physical assets (real estate, gold) resulting in headwind for retail investment demand. ( Sources: Reserve Bank of India, World Gold Council)

Investment motives for bar and coin remain different

While the gold investment market is still contending with structural changes, the objectives behind buying bars and coins are largely unchanged. Bars remain the preferred choice for investment, whereas coins tend to be used for gifts and other festive-related purchases. The size of the Indian gold bar market is roughly twice that of coins.

In terms of composition, all bars are produced in 24-carat gold. Popular sizes for smaller investors include the Guinea (at 8g, 10g and 20g); larger weights, such as 50g and 100g, resonate with high-net-worth buyers. These are used either for investment or for converting into jewelry at a later date. Smaller sizes, including 1g, 2g and 5g, tend to be bought for gifting purposes. Overall, the market is dominated by minted bars weighing 100g or less, with a share of around 90-95% 23 .

Coins are extremely popular during festive seasons, notably Diwali and Dhanteras and the auspicious day of Akshaya Tritiya, which explains why 30-40% of coin sales take place during these periods. Also produced in 24- carat gold, popular sizes include 1g, 2g, 5g, 8g and 10g. Most coins feature inscriptions of gods and goddesses, particularly images of the goddess Lakshmi and elephant-headed god Ganesha. Coins are also used for gifting

purposes during special occasions, notably for the birth of a child or at weddings. (Source : World Gold Council)

Jewellers are the favoured point of sale

The vast majority of bar and coin sales take place in jewellery stores. Over recent years there have been new developments, notably a growth in direct sales by gold refineries and an increasing use of online platforms. Many of the recently established refineries are now selling to consumers through retail stores and digital channels. E-commerce platforms have also made notable inroads into the market; Metals Focus estimates that some 3% of bars and coins are sold via sites such as Flipkart, Snapdeal and Amazon. Some 80-85% of offline sales of gold bars and coins are transacted through jewellers, with the balance bought direct from refineries. (Source : World Gold Council)

COMPANY OVERVIEW:

"We want to make Gold and Silver Purchases affordable, convenient and transparent through personal touch"

Your Company is engaged in the Business of Trading of Precious Metals i.e. 24 Carat Gold, Silver Bars & Jewellery. We focus on spot buying and selling of physical 24 Carat gold and silver bars. We have developed the 24 carat gold and silver bars under our own brand name "Aurel" with different denominations and sizes.

Our Gold & Silver bars and coins with 24K purity can be bought through our online platforms, i.e. our App Aurel Bullion download able from both Play Store and App Store, as well as through offline mode also. We also provide to our B2b and B2c clients the Antique Jadau Jewellery which is being manufactured at Amritsar, Punjab. The Company expects that these businesses will persist in the coming years. For more details please visit our website www.amanaya.in

OPPORTUNITIES

There are other reasons why Indian investors have regarded gold as a preferred mode of investment, the most important being its role as a safe haven asset, diversifier and a hedge against inflation, plus the liquidity it offers in terms of ease of selling back and its use as security for a loan. Further Increasing affordability, E-commerce development, Changing life styles offer the opportunities for the companys products to flourish in future.

THREATS TO PHYSICAL INVESTMENT DEMAND

• Sovereign gold bonds (SGBs) have gained popularity due to additional fixed interest.
• Young tech-savvy investors are driving growth for digital gold.

1. OUTLOOK ON RISK AND CONCERNS:

Your Company is of the view that most of the regulatory un-certainties have already played out and with a stable GST, things would only improve in the long term. Further the organized/branded market may see better gains because of indirect tax reforms however there are certain concerns that may impact the Company-

1. The Companys ability to execute its strategy.
2. Consumer sentiments and economic stability in the Country.

Further, Your Company is exposed to a number of risks such as economic, regulatory, taxation and environmental Risks.

2. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The Company has a proper and adequate system of internal controls. This ensures that all transactions are authorized,

recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition.

1. Discussion on financial performance with respect to operational performance

During the year, total income of your company was Rs. 3,08,080/-thousands as against net income of Rs.1,10,912/- thousands of the previous year. However, the Companys net profit after tax has been increased to Rs.9,59/-thousands for the current year as against the net profit after tax of Rs. 7,81/- thousands of the previous year due to increase in profit margin against higher expenditure incurred.

2. HUMAN RESOURCES & INDUSTRIAL RELATIONS:

The Companys human resources philosophy is to establish and build a strong performance and competency driven culture with greater sense of accountability and responsibility. The Company acknowledges that its principal asset is its employees. The total numbers of employees as on 31st March, 2024 were six.

3. DETAILSOFSIGNIFICANTCHANGESINKEYFINANCIALRATIO:

Pursuant to provisions of Regulation 34(3) of SEBI (LODR) Regulation, 2015 read with Schedule V part B (1) Details of changes in Key Financial Ratios are given hereunder:

Sr. No.	Ratio	Formula	2023-24 2022-23	2022-23	%	Reason for
			Ratio Ratio	Ratio	Variance	Variance
1	Current Ratio	Current Assets	63.22	74.58	-15.23	Decrease in Current Assets and increase in Current liabilities during the year
	(Times)	Current Liability
2	Inventory Turnover Ratio	Net Sales	8.05	5.12	57.21	Increase due to increase in turnover and increase in inventories
	(Times)	Inventory
3	Trade Receivable Turnover	Net Credit sales		N.A	N.A
	(Times)	Average account Receivable
4	Trade Payable Turnover Ratio	Net Credit purchase		N.A	N.A
	(Times)	Average account payable
5	Net Capital Turnover Ratio	Net Sales	6.14	2.25	172.65	Increase due to Increase in turnover
	(Times)	Shareholder Fund
6	Debt Equity Ratio	Total Debt	0.01	0.01	-20.35	Decrease due to decrease in total debt
	(Times)	total equity
7	Debt service Coverage Ratio	Operating Profit			194.30	Increase due to decrease in Debt and increase in operating profit

	(Times)	Debt Service Cost	11.33	3.85
8	Net Profit Ratio %	PAT	0.31	0.70	-55.79	Decrease due to increase in Expenditures.
		Total Revenue
9	Return on Capital Employed %	Operating Profit	2.47	2.73	-9.47	Decrease due to increase in Expenditures.
		Capital employed
10	Return On Equity Ratio %	PAT	1.91	1.59	20.53	Increase due to increase in PAT
		Shareholder Fund
11	Return on Investment (%)	PAT	1.88	1.56	20.52	Increase due to increase in PAT
		Total Assets

4. CAUTIONARY STATEMENT:

This document contains forward-looking statements about expected future events, financial and operating results of the Company. These forward-looking statements are based on assumptions and the Company does not guarantee the fulfillment of the same. Accordingly, this document is subject to the disclaimer and qualified in its entirety by the assumptions, qualifications and risk factors referred to in the managements discussion and analysis of Amanaya Ventures Limiteds Annual Report, 2023-24.

By Order of the Board of Directors

Amanaya Ventures Limited