arunjyoti bio Management discussions

Annexure 4

Industry structure and developments.

• The beverage industry (the drink industry) manufactures drinks and ready-to-drink products. Examples are bottled water, soft drinks, energy drinks, milk products, coffee and tea-based products, nutritional beverages, and alcohol.

• The beverage industry is traditionally a market with specific high demands regarding hygiene and related technologies.

• Exquisite hygiene is needed to maintain the end products high-quality standards and shelf life, whether mineral/drinking water, lemonade, fruit juice, beer, wine, or (sparkling) wine.

• Beverage production varies mainly depending on the product being made.

• The beverage industry consists of two major categories:

• Alcoholic beverage industry: The alcoholic beverage industry includes distilled spirits, (sparkling) wine, cider, and brewing.

• Non-alcoholic beverage industry: The non-alcoholic beverage industry is comprised of soft drink (or soft beverage industry) or syrup manufacture; soft drink and water bottling and canning), fruit juices bottling, canning, and boxing, the coffee industry, and the tea industry.

• The non-alcoholic beverages industry encompasses liquid refreshment beverages (LRB) such as bottled water, carbonated soft drinks, energy drinks, fruit beverages, ready-to-drink coffee and tea, sports beverages and value-added water.

• On the other hand, non-alcoholic drinks help keep you hydrated and may even contain vitamins and minerals that your body can put to good use.

Opportunities and Threats.

• Opportunities would be growth in beverages consumption in emerging markets, Increasing demand for healthy food and beverages, Further expansion through acquisitions and Bottles water consumption growth.

• Threats for this industry is Changes in consumer tastes and Water scarcity.

Segment-wise or product-wise performance

• The non-alcoholic beverages market is segmented into carbonated and non-carbonated beverages. The market for carbonated beverages is projected to surge at a CAGR of 5.57% during FY 2022 to FY 2027 to reach INR 185.96 billion at the end of the forecast period.

• The category of carbonated beverages is anticipated to lose market share during the projected period because of the non-carbonated beverages segments quick expansion. Aerated beverages that arent cola, in particular fruit drinks, have grown in popularity recently. Leading companies are changing their business strategies in response to consumer worries about their health. The market for non-carbonated beverages has expanded rapidly because of growing consumer health consciousness and easier accessibility.

Outlook

Risks and concerns.

• The traditional non-alcoholic beverages market has been facing a lot of challenges due to a decline in the demand for traditional carbonated soft drinks due to loaded sugar and artificial sweeteners, lack of skilled workforce, and huge capital costs.

• Food contamination, cross contamination and quality control continue to be major challenges facing the food and beverage industry. This impacts all parts of the supply chain, especially food processing and manufacturing facilities.

Risks and concerns.

• The traditional non-alcoholic beverages market has been facing a lot of challenges due to a decline in the demand for traditional carbonated soft drinks due to loaded sugar and artificial sweeteners, lack of skilled workforce, and huge capital costs.

• Food contamination, cross contamination and quality control continue to be major challenges facing the food and beverage industry. This impacts all parts of the supply chain, especially food processing and manufacturing facilities.

Internal control systems and their adequacy.

• Planning an Internal Audit

• Basic Principles Governing Internal Audit

• Documentation

• Reporting

• Sampling

• Analytical Procedures

• Quality Assurance as per the SOPs defined

• Communication with Management

• Internal Audit Evidence

• Internal Control Evaluation

Discussion on financial performance with respect to operational performance.

Material developments in Human Resources / Industrial Relations front, including number of people employed.

• The industrial relations have been considered to be satisfactory and all the required Licenses are procured.

• The company constantly reviews the manpower requirements and effective steps are being taken to meet the requirements as per the standards.

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor, including:

Particulars	As at March 31,2023	As at March 31,2022	% Change	Reason for Variance
Debtors Turnover	2.63	2.50	0.13	NA
Inventory Turnover	0.02	226.99	-226.97	NA
Interest Coverage Ratio	3.16	1.30	1.86	NA
Current Ratio	3.64	11.67	-8.03	NA
Debt Equity Ratio	0.72	0.05	0.67	NA
Operating profit margin (%)	9.39	-6.83	2.56	NA
Net profit ratio (%)	6.73	1.24	5.49	NA
Return on networth	5.52	2.84	2.68	NA

Details of any change in return on net worth as compared to the immediately previous financial year along with a detailed explanation thereof:

There is 2.68 % change on return on net worth as compared to the immediately previous financial year.

Disclosure of Accounting Treatment

The Company has complied all the requirements of accounting standards applicable to the Company and during the year company has not changed any accounting policies.

Cautionary Statement

Readers are advised to kindly note that the above discussion contains statements about risks, concerns, opportunities, etc., which are valid only at the time of making the statements. A variety of factors known/unknown expected or otherwise may influence the financial results. We do not expect these statements to be updated or revised to take care of any changes in the underlying presumptions. Readers may therefore appreciate the context in which these statements are made before making use of the same.