Amic Forging Ltd Management Discussions

INDUSTRY STRUCTURE AND DEVELOPMENT

The forging industry is a critical segment of the broader manufacturing and metalworking sectors. It involves shaping metal using compressive forces, often applied through hammers, presses, or rolls. The industry produces a wide range of high-strength parts for various applications, from automotive to aerospace and heavy machinery.

In FY 2023-24, the global forging industry demonstrated growth, driven by demand across sectors like automotive, construction, energy, and railways. The industry is evolving through technological innovation and international collaboration, although further advancements in special materials are needed for competitive growth.

Indias forging industry, recognized for its technical expertise, continued expanding its installed capacity, reaching around 3.85 million tons annually. This sector, which serves key industries like automotive and industrial machinery, is investing heavily in modernizing through automation and high-end equipment. Indian companies have also increased their focus on export markets while adopting sustainable practices to align with global manufacturing trends.

The forging industry offers several opportunities due to its vital role in various sectors like automotive, aerospace, construction, agriculture, and energy. With increasing concerns about global supply chains and a shift toward localized production, there is an opportunity for domestic forging companies to capture business from customers looking to reduce their reliance on imports, particularly in critical industries. Investing in innovation, efficiency, and expansion into new sectors or markets can help companies in the forging industry capitalize on these opportunities.

- Capital-Intensive Nature

Forging requires significant capital investment in machinery and technology, which can be a barrier for smaller players and new entrants

- Skilled Labor Shortage As the forging process becomes more technologically advanced, there is a shortage of skilled workers who can operate and maintain sophisticated forging equipment.

- Raw Material Volatility:

Fluctuations in the price of raw materials such as steel can significantly affect the profitability of forging companies, especially for those operating with low margins.

The forging industry is expected to continue evolving, with a focus on innovation, digital transformation, and sustainability. As industries like electric vehicles, renewable energy, and space exploration grow, the demand for forged components will rise. Additionally, the trend towards lightweighting in automotive and aerospace sectors will further drive advancements in forging materials and processes.

The Company (AMIC) does not have multiple segments. Hence, comments on segments wise performance are not required.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The details have been provided in Boards Report.

Following are ratios for the current financial year and their comparison with preceding financial year along with explanations:

Your Company remains committed to maintain, high standards of internal control designed to provide adequate assurance on the efficiency of operations and security of its assets. The adequate and effectiveness of the internal control across various activities, as well as compliance with laid down system and policies are comprehensively and frequently monitoring by your companies management at all levels of organization.

We firmly believe that our employees are pivotal to our success and growth. Our human resources strategy is designed to attract, retain, and nurture the best talent, ensuring that each individual contributes effectively to our business objectives. Our workforce includes Experienced Professionals, Skilled Workers, Semi-Skilled and Unskilled Workers.