Aroni Commercials Ltd Merged Management Discussions

(a) Industry structure

Over the years Indian capital market has improved and developed as a sophisticated market place withmodern facilities and amenities. With a dedicated regulator for the securities market the functions have become systematic and controlled providing depth & discipline to the market structure. SEBI regulates capital market through the process of registering the intermediaries and framing rules & regulations for each activity involving capital market functions. As per the available data on registered market intermediaries, there are 191 Merchant Bankers, 3405 Corporate Brokers under Cash segment & 853 Depository Participants registered with SEBI as on December 2015. Your Company is one of the capital market intermediaries registered with SEBI as BSE sub-broker of M/s. Shriyam Broking Intermediary Ltd.

The industry structure is well defined and organized over a period of time. The capital market regulator acts swiftly to adopt to any change & development that is witnessed in the market place. The consultative process of making rules & regulations and also monitoring the intermediaries is adopted by the regulators making it a very vibrant and transparent structure. The requirement of having trained personnel at various registered intermediaries is being implemented by SEBI which is helping the intermediaries to remain upto- date in tune with global market conditions and practices followed besides having knowledge and information about the recent developments in the capital market. With India, being one of the favoured investment destination, capital market structure is bound to become more & more sophisticated with latest technologies.

(b) Business Developments

Your Company has set up adequate infrastructure along with a team of professionals for carrying on the business of the company efficiently.

(c) investment

Year 2015 turned out to be a complicated year for investors with corporate performance failing markets expectation. The silver lining for 2015 however, was the continued flows received by domestic institutions, particularly mutual funds, from retail participants who saw great opportunity in exploiting the valuation arbitrage created from the earlier run-up in the benchmark indices and large cap stocks.

In year 2016, equity market performance will be driven more by real performance rather than by expectations like the premium attributed earlier to global excess liquidity, political strength of the government at the center or any other major trigger.

Among the emerging market (EM) peers, India remained in a bright spot amid a slowdown in global economy on the back of multiple rate cuts by the RBI and its efforts to keep inflation under check and capital infusion by the domestic investors.

(d) Opportunities and threats

Immense opportunities exist in the Broking & Investment Services Industry depending upon the growth of the country. The Major threat to your companys fortune would be on account of adverse capital market trends and sentiments affected by domestic and global factors.

India is on the cusp of a structural bull market after a prolonged slowdown of three years. With the building blocks for aneconomic recovery in place (like lower commodity prices, reform oriented government, low inflation and low interest rates),we believe that as the recovery comes about, participation in the financial markets is likely to increase. Moreover, with the focus of the Government to shift the savings of the economy into productive financial assets rather than unproductive physical assets the equity broking industry is set for increased volumes over the next few years.

(e) Segment-wise or product-wise performance

Your Company is the registered with SEBI as BSE sub-broker of M/s. Shriyam Broking Intermediary Ltd. and is also involvedin the activities of Investment in shares/ Bonds etc. The company operates in a single reportable segment as such reporting is done on single segment basis.

(f) Outlook

The overall political and economical scenario in the country has been improved with a steady increase in GDP. India has been a favoured investment destination in the world. The overall impact on the capital market has been very positive. It is expected that the current financial year will also have a optimistic outlook as far as capital market is concerned though some negative breakouts are expected on account of any international events that may affect Indian capital markets.

(g) Risks and Concerns

Your Company is exposed to the fluctuations of economy and industry cycles. The company manages these risks by remaining very conservative and following other risk management practices. The management believes that efficient business planning risk management and product diversification would help mitigate such risks.

(h) internal Control Systems and their adequacy

As a part of the effort to evaluate the effectiveness of the internal control systems, your Companys internal audit system reviews all the control measures on a periodic basis and recommends improvements, wherever appropriate. The Company has in place adequate internal control systems and procedures commensurate with the size and nature of its business. These systems and procedures provide reasonable assurance of maintenance of proper accounting records, reliability of financial information, protection of resources and safeguarding of assets against unauthorized use. The management regularly reviews the internal control systems and procedures.

(i) Discussion on Financial Performance with respect to operational Performance (Standalone):

Highlights	2015-2016	2014-2015	Change
	(Rs. in Lacs)	(Rs in Lacs)	in %
Revenue from operations & other income	1301.57	364.63	256.95
Profit before Tax	1204.21	263.61	356.81
Provision for taxation (Including Deferred Tax &MAT)	1.64	16.13	(89.83)
Net Profit after Tax	1202.57	247.48	385.93
Earnings per share (in Rs.)
- Basic	29.15	6.00	385.83
- Diluted	29.15	6.00	385.83

During the year on consolidation, after considering share of loss in associate profit for the year attributable to the shareholder of the Company is 1202.53 Lakhs.

(J) Human Resource Development

The Company believes that the human resources are vital resource in giving the company a competitive edge in the current business environment. The companys philosophy is to provide congenial work environment, performance oriented work culture, knowledge acquisition/dissemination, creativity and responsibility. As in the past, the company enjoyed cordial relations with the employees at all levels.

(k) Amalgamation of Aroni Commercials Limited with Saraswati Commercial (india) Limited

Pursuant to the Scheme of Amalgamation of Aroni Commercials Limited (Transferor Company) with Saraswati Commercial (India) Limited (Transferee Company)

• The amalgamation will enable the Transferee Company to consolidate the businesses and lead to synergies in operation and create a stronger financial base.

• It would be advantageous to combine the activities and operations of both companies into a single Company for synergistic linkages and the benefit of combined financial resources. This will be reflected in the profitability of the Transferee Company.

• This Scheme of amalgamation would result in merger and thus consolidation of business of the Transferor Comp ny and the Transferee Company in one entity, all the shareholders of the merged entity will be benefited by result of the amalgamation of Business and availability of a common operating platform.

(l) Cautionary statement Statements

The Company assumes no responsibility nor is under any obligation to publicly amend, modify or revise any forward looking statements on the basis of any subsequent developments, information or events.