Global Economic Overview
The projected path of global economic growth is expected to transition
from approximately 3.5% in 2022 to around
3.0% in both 2023 and 2024. This shift is decisions made by central
banks regarding their policy rates, which wield significant influence over economic
dynamics Inflation-2022 to 6.8% in 2023, further receding to 5.2% in 2024. Its important
to note that gradual adjustments are anticipated in core inflation
Recent successful resolutions concerning the US debt ceiling and
efforts to fortify banking stability have effectively mitigated immediate financial
persistent concerns about potential adverse effects on growth. Factors such as elevated
inflation possibility of unforeseen events like conflicts weather could trigger
modifications in monetary policies. The recovery of Chinas economy might also witness a
slowdown due to challenges within the real estate sector, potentially rippling into other
global economies. Conversely, there remains potential for positive outcomes if inflation
subsides more rapidly and domestic demand remains robust.
Across diverse economies, key priorities include sustaining a trend of
disinflation Central banks are advised to continue their emphasis on maintaining price
stability and adeptly supervising financial systems. Countries are urged to provide ample
liquidity during periods of market strain, establish fiscal reserves to provide targeted
support, and enhance economic capacities . tofacilitatemoreeffectivemanagementofinflation
Outlook
The present global economic forecast suggests a gradual easing in the
recovery trajectory, the combined impacts of the COVID-19 pandemic and geopolitical
developments related to Russias actions in Ukraine. While supply chains exhibit signs of
improvement, persistent challenges such as heightened inflation, cautious approaches by
central banks, and constrained access to credit remain prevalent.
During sector the showcased resilience, whereas the manufacturing
sector encountered a weakening trend. This divergence underscores prevailing uncertainties
and underscores the restrained pace of productivity growth. The interplay between
heightened a inflation pivotal role in shaping the economic landscape. Consequently, the
global growth trajectory is expected to shift from 3.5% in 2022 to a slightly lower 3.0%
in both 2023 and 2024. This adjustment is mainly steered by advanced economies, while
influenced by emerging markets sustain a certain level of stability, albeit with
variations across different regions.
Source:https: //www.imf.org/en/Publications/WEO/ wise,
forecasts suggest decline from 8.7% in Issues/2023/07/10/world-economic-outlook-update-july-2023
Indian Economic Overview
The Economic Survey of 2022-23 has outlined Indias economic prospects,
projecting a GDP growth of 6.0-6.8% risks. However, there are for the upcoming fiscal
year, 2023-24. Notably, the economy is set to achieve a commendable 7% growth levelsandthe
by March 2023, building upon an impressive 8.7% increase witnessed in the andextreme
previous year. This positive trajectory is largely attributed to the strong increase in
credit accessibility for Micro, Small, and Medium Enterprises (MSMEs), coupled with higher
government capital expenditures.
Although there might be a slight overshoot of inflation targets, there
is a positive aspect as improvements have been observed in the housing market inventory.
The momentum for this growthandsafeguarding financial has been further boosted by a rise
in exports, effectively stimulating production. A significant consumption, constituting
58.4% of the GDP. This surge has been supported by the revival of contact-intensive
services that have experienced a resurgence.
Its essential to recognize that the realm of global trade is heading
for a slowdown, transitioning from a 3.5% growth rate observed in 2022 to a more moderate
1.0% in 2023, reflecting by economic landscape.
Outlook
The Economic Surveys projection for the 2023-24 outlook underscores
Indias impressive recovery post the pandemic. This revival is propelled by strong
domestic demand and increased capital investment, fostering a new phase of private sector
capital formation. The synergy between this trend and substantial government capital
expenditure bodes well for the economy. Structural reforms like the Goods and
Services Tax and the Insolvency and Bankruptcy Code have enhanced
efficiency and transparency. Despite predictions of a global economic slowdown by the IMF
and World Trade
Organization, Indias growth trajectory remains positive. However,
risks such as fluctuating commodity prices, export dynamics, and inflation remain as
potential factors and influencing currency valuation. The possibility of inflation-induced
higher borrowing costs could contribute to a subdued global economic landscape.
Encouragingly, India benefits from favorable factors including lower oil prices and an
improved current account outlook, thereby enhancing overall external stability.
S o u r c e :h t t p s : //p i b . g o v. i n / P r e s s R e l e a s e
P a g e . aspx?PRID=1894932
In both 2023 and 2024, Indias projected growth rates
(6.1%and6.3%)aresignificantly higher than those of advanced economies (1.5% and 1.4%).
This indicates that Indias economy is expected to continue growing at a much faster pace
compared to the more mature economies of advanced nations.
Source: https://www.imf.org/en/Publications/WEO/Issues/2023/07/10/world-economic-outlook-update-july-2023
Global Plastic Market
The global plastic market had a valuation of USD 609.01 billion in
2022, and it is anticipated to expand at a compound annual growth rate (CAGR) of 4.0% from
2023 to 2030. This growth trajectory is being propelled by increased plastic consumption
across diverse sectors such as construction, automotive, and electrical & electronics.
Notably, regulations aimed at enhancing fuel efficiency and curbing carbon emissions by
reducing vehicle weight are catalyzing the use of plastic as a substitute for metals like
aluminium and steel in the production of automotive components.
In addition, the upsurge in construction activities in emerging
economies like Brazil, China, India, and Mexico is significantly bolstering the demand for
plastics. This surge can be attributed to a rise in foreign investments in domestic
construction markets, spurred by eased Foreign Direct Investment (FDI) norms and the
demand for improved public and industrial infrastructure.
The United States stands as a noteworthy player in the plastic market,
with a demand valued at USD 87.93 billion in 2022. This is largely attributed to the
well-established presence of industries such as automotive, aerospace & defense, and
electronics. The countrys stability, low-risk environment, and robust financial sector
have attracted considerable investor interest, fostering expectations of increased
infrastructure spending. Consequently, the construction sector in the U.S. is expected to
experience heightened demand for plastics. The synergy of a growing global population,
rapid urbanization, and industrialization in emerging economies has compelled governments
to escalate their construction expenditures to meet expanding infrastructure requirements.
Particularly, the surge in government construction spending in China and India is poised
to drive substantial demand for plastics in infrastructure and construction applications.
The imperative to adhere to stringent regulations addressing the
depleting resources and recyclability concerns associated with traditional materials like
metals and wood is projected to drive heightened demand for plastics within the
construction sector. Applications such as insulation, pipes, cables, floorings, windows,
and storage tanks are expected to witness increased plastic usage. Furthermore, the
simplicity and ease of installation of polymer fittings, coupled with a diverse palette of
color options, contribute to their aesthetic appeal. Notably, plastics exhibit a
significantly lower specific gravity compared to metals, resulting in approximately 80%
weight reduction and 30% to 50% cost savings in individual components within the
automotive and construction industries.
Indian Plastic Market
The Indian plastic market has witnessed remarkable growth potential,
fostering the development of local businesses to enhance their technical prowess, meet
stringent quality standards, and expand their capabilities across various sectors within
the burgeoning plastics industry.
Significant strides have been made in the petrochemical sector, coupled
with advancements in plastic machinery, leading to substantial progress in the plastic
processing industry. This, in turn, has facilitated plastic processors in augmenting their
production capacity to cater to both the domestic and international markets. Presently,
the Indian plastic processing landscape encompasses approximately
30,000 units employing techniques such as injection molding, blow
molding, extrusion, and calendaring to manufacture a diverse array of products.
Plastic materials have gained increasing prominence across diverse
industries, resulting in a swift rise in per capita consumption. Conventional materials
are swiftly being supplanted by plastic technology, advanced processing equipment,
specialized expertise, and cost-efficient manufacturing. The adeptness in various facets
of this industry, combined with innate capabilities, underpins the industrys ability to
serve global markets. Over the past few decades, the Indian plastics sector has undergone
substantial growth, emerging as one of the nations pivotal industries with a substantial
foundation.
Plastic consumption in India displays noteworthy regional disparities,
with Western India accounting for 47%, Northern India for 23%, and Southern India for 21%.
Currently, the plastics industry accommodates around 50,000
establishments, predominantly comprising micro, small, and medium-sized enterprises
(MSMEs). These entities collectively contribute INR 3.5 lakh crore (US$ 42.89 Billion) to
Indias economy and offer employment opportunities to over 50,000 individuals. The nation
boasts a plastic recycling rate of 60%, surpassing that of many developed countries. The
governments initiatives like "Make in India," "Skill India,"
"Swachh Bharat," and "Digital India" are propelling plastic
production. By 2027, projections anticipate that the plastics industry will amass an
annual revenue of INR 10 lakh crore (US$ 122.54 Billion), accompanied by exports amounting
to two lakh tonnes.
"Indian plastics industry projected INR 10 lakh crore (US$ 122.54
Billion) revenue by 2027 solidifies its pivotal role in shaping Indias economic
landscape."
Sources:https://www.ibef.org/research/case-study/india-s-plastic-industry
Plastic Furniture Market
Anticipated as of 2023, the Plastic & Other Furniture market is
poised for impressive growth, with projected revenue surging to US$ 56.12 Million. This
trend is set to continue its upward trajectory, boasting an annual growth rate of
11.08% (CAGR 2023-2027). These dynamics point towards a promising
future, culminating in a projected market volume of US$ 85.45 Million by 2027.
At the epicentre of this economic surge is the United States, acting as
a prime revenue generator. Projections indicate a remarkable market volume of US$ 1,829.00
Million by 2023, underscoring the substantial role the United States plays in shaping the
industry landscape.
In the realm of user engagement, the Plastic & Other Furniture
market is primed for expansion. By 2027, an estimated 85.2 Million users are expected to
participate. This surge highlights a significant upward trajectory, considering that user
penetration is projected to escalate from 3.6% in 2023 to an impressive 5.8% by 2027.
Embedded within these trends is the Average Revenue Per User (ARPU), a
pivotal metric. Each users contribution is envisaged to average at US$ 1.08, indicative
of the markets potential to yield substantial revenue from its growing user base.
In summary, the Plastic & Other Furniture market is on an upward
trajectory, with robust revenue projections and a compelling CAGR. The United States
pivotal role in shaping the markets size is noteworthy, and the projected increase in
user engagement suggests a dynamic and promising industry outlook.
"The plastic furniture market was valued at US$ 13,610 million in
2021 and is expected to reach US$ 22,994 million by 2030, with a CAGR of 6% during
2021-2030."
India has taken significant strides in plastic waste recycling,
outperforming even countries like Germany and the US. Reports indicate that India recycles
an impressive 60% of its plastic waste, while Germany manages 56% and the
US lags behind at just 9%. This commitment to recycling is deeply
ingrained in Indias cultural fabric and has far-reaching implications for the adoption of
circular products and services.
Interestingly, the average lifespan of cars in India is notably longer
compared to the US, with vehicles being cherished for around 9 years, while in the US, the
norm hovers around 7 to 8 years. This cultural propensity towards longevity not only
reflects a sustainable mindset but also opens up a realm of possibilities for the
proliferation of circular goods and services. Such an outlook naturally cultivates a
thriving market for these sustainable offerings.
Projections also illuminate Indias economic ascension on the global
stage, poised to secure the position of the worlds third-largest economy by 2030,
contributing about 8.5% to the global GDP. In light of these numbers, envisioning the
Circular Economy soaring to a $4.5 trillion valuation by 2030 instills optimism. Under
this scenario, even a modest 1% market share for India would translate into a staggering
$45 billion plus opportunity.
However, if India were to mirror its 8.5% contribution to global GDP
within the realm of the Circular Economy, the nation could feasibly foster a Circular
Economy valued at over $380 billion. This ambitious prospect underscores the
transformative power of the Circular Economy in propelling Indias growth throughout the
forthcoming decades. A captivating side effect of this sustainable surge would be the
substantial environmental benefits, including a noteworthy reduction in congestion and
pollution levels.
In essence, the potential for harnessing the Circular Economys
momentum resonates as a pivotal force driving Indias growth trajectory. This journey,
interwoven with economic expansion, promises to yield not only prosperity but also
invaluable ecological advantages that resonate for generations.
S o u r c e : h t t p s : //w w w. k a l a a r i . c o m /w p - c o
n t e n t / uploads/2022/04/Circular-Economy-Report-2022.pdf
Extended Producer Responsibility (EPR)
Extended Producer Responsibility (EPR) stands as a pivotal policy
mechanism, wielding the potential to propel the circular economy forward. By assuming
responsibility for the entire lifecycle of a product, EPR significantly curbs the
environmental impact of both the product and its packaging, while embodying the principle
of "polluter pays," thereby holding producers accountable.
In recent times, EPR has garnered global attention, emerging as a
direct response to the escalating menace of plastic pollution, driven particularly by the
ubiquity of packaging and single-use plastics. The surge in population growth and rapid
urbanization, coupled with the unabated rise in consumption and utilization of disposable
products since the 1950s, has triggered an exponential surge in waste generation
worldwide. This unrestrained growth in waste signific on governments, output has imposed a
challenging their ability to manage this mounting challenge effectively.
The objectives of EPR are as follows:
• Integration of environmental costs
• Improved waste management
• Reduction of disposal
• Reduction of burden on municipalitiesW , the
• Design of environmentally sound products
Opportunities and Threats
Opportunities:
Amidst the prevailing environmental consciousness, the realm of
biodegradable plastics production emerges as a realm brimming with potential. This
trajectory is significantly propelled by governmental emphasis on safeguarding the
environment, coupled with a mounting public awareness of the detrimental repercussions of
plastic pollution. In parallel, the allure of recycled plastic is expected to ascend,
finding stronger foothold in the domain of plastic furniture.
Undeterred by the formidable competition posed by the unorganized
sector, the company demonstrates an unwavering commitment to extending its reach into
uncharted market territories. This tenacity is driven by the pursuit of novel
opportunities and is emblematic of the companys resilient spirit in the face of
challenges.
With a resolute focus on the industrial sector, the company aspires to
carve out a distinctive niche for itself as a pivotal player. This aspiration is anchored
in the delivery of high-quality products and the cultivation of robust corporate
governance practices. Through this strategic direction, the company endeavors to augment
its product portfolio, thereby bolstering its influence and stature within the industry
landscape.
Threats:
Navigating through the intricate maze of uncertain government policies
and the unpredictable ebbs and flows of market conditions emerges as a substantial
challenge. The landscapes inherent volatility demands adept maneuvering to ensure
consistent growth.
The relentless march of technological progress, while promising
innovation, simultaneously poses a threat. The necessity to remain at the vanguard of
technological advancements becomes imperative to stay relevant and competitive.
The swelling tide of competition stands as a formidable adversary. The
burgeoning number of players vying for prominence amplifies the pressure to consistently
differentiate and excel.
Undoubtedly, the unorganized small-scale sector casts a significant
shadow on the horizon. The relentless competition emanating from this sector necessitates
strategic agility to counter their impact effectively. fluctuations In
realmsusceptibletoeconomic of a stagnation phase or an economic downturn looms large.
The convergence of various factors could potentially trigger a
slowdown, demanding contingency plans to navigate through such challenging periods.
Company Overview
Our company specializes in the manufacturing of top-tier plastic molded
furniture, known for its exceptional quality. Our products are marketed under the renowned
brand names AVRO and AVON, catering to customers across India through both online and
offline channels. a Distinguished by an extensive and diverse product portfolio, we
proudly offer one of the widest ranges in the industry, all while maintaining
affordability. Notably, AVRO stands as an industry pioneer by providing an unprecedented
3-year guarantee on selected product lines an achievement yet to be matched in the Indian
market.
Our brand, AVRO, stands tall as a leader in the plastic furniture
segment across India. Fuelled by an unwavering commitment to innovation, our company
consistently introduces groundbreaking products that redefinethe industry landscape. As we
move forward, our dedication to innovation will remain a driving force, ensuring the
introduction of numerous novel and cutting-edge offerings.
Business Overview
The Turnover and Net profit of the Company increased considerably in FY
2022-23 as compared to FY 2021-
22 despite increase in polymer prices. The company has achieved a total
sales of 80.01 Crore where the offline sales were 76.43 Crore and online sales were 3.58
crore. Due to its high-quality and reasonably-priced product line, combined with its best
in class 3-year warranty in some product ranges, the company is among the most well-liked
companies on platforms like Amazon and Flipkart when compared to major names in terms of
ratings and reviews. As demand for the companys products grows, we want to establish a
warehouse in southern India to facilitate efficient logistics. The company now sells its
items through the Amazon Fulfilled and Flipkart Assured programmes.
The company is concentrating on growing online sales and establishing a
presence on other portals, such as Meesho, Indiamart, Jio Mart etc. In the coming years,
one of the companys main growth drivers will be online sales. During the financial year
started manufacturing polymer by using plastic waste for inhouse consumption. Thereafter,
the Company has commenced a new plant for recycling facility with capacity of 300 metric
ton per month w.e.f. 22nd December, 2022. During the financial antly as signific revenue
of the Company has increased compared to last financial year. During the year, the company
has also started expanding its distribution network out of north India through competitive
pricing and using the vacuum created by big brands is helping us in acquisitions. To
motivate and onboard channel partners, the Company is doing Dealer & Distributor
Roadshows on a regular basis in different pockets of India.
Now our products are also available at big box retailers like Metro
& Lots.
The company is active on social media for marketing its products. We
have a strong presence on social media platforms like facebook and youtube. We do product
marketing and product reviews on youtube for highlighting key features of our products.
Also on social media, we also do contests on various occasions to promote our products
through coupons.
During the year, the Company introduced new models in different
products categories like Chairs, Almirah etc in the market which has received very
positive response from our customers and can be a growth driver for following years.
Segment-wise Performance
The Companys operations are classifiedas belonging to a single or main
business segment. Accordingly, disclosures under Ind AS-108 "Operating Segments"
are not required to be made.
Growth Strategy and Outlook
AVROs position as a leading brand in Indias plastic furniture market,
known for producing high-quality plastic molded furniture. The companys commitment to
fulfillingits societal obligations by offering quality products at affordable prices
aligns with its existing operations. This commitment forms the basis for AVROs efforts to
contribute positively to the environment through its recycling and sustainability
initiatives.
AVROs innovative use of "Regenerated" polymers instead of
"Virgin" polymers reflects its dedication to incorporating environmental review,
the Company has considerations into its operations. This sustainable approach to raw
materials resonates with the recycling theme. By collecting and upcycling commonly used
plastics like HDPE, LDPE, and PP, AVRO is actively participating in the circular economy,
turning discarded plastics into valuable resources for creating new furniture ended
2022-23, the turnover and products. This circular economy model not only promotes
environmental responsibility but also aligns with the companys mission to produce plastic
furniture while keeping the environment in mind.
"Crafting Sustainable Comfort for a Greener Tomorrow"
The companys forward-thinking strategy of preparing for backward
integration in plastic regeneration showcases its commitment to securing a sustainable
supply of raw materials. This integration not only supports its own production
needsbutalsosignifiesa proactive approach to minimizing the environmental impact of its
operations. As AVRO plans to expand its product line beyond plastic furniture, such as
rotating chairs and mattresses, while outsourcing production, it continues to maintain its
connection to the recycling theme. By focusing on marketing and outsourcing the
production, the company can concentrate on promoting its products while leveraging its
established network of distributors and retail partners. This strategic move aligns with
AVROs mission of offering high-quality goods while also embracing a recycling-oriented
approach.
Furthermore, AVROs intention to enhance its retail and distribution
networks in states beyond its stronghold of
Uttar Pradesh suggests a broader commitment to making its sustainable
products available across India. This expansion aligns with the companys ethos of
providing affordable, high-quality products to a wider customer base while contributing to
the circular economy.
The chosen advertising mediums, such as FM Radios, Newspapers, and
posters on moving vehicles, highlight AVROs efforts to reach diverse audiences with its
recycling-focused message. These communication channels enable the company to inform the
public about its sustainable practices and encourage them to be part of a larger movement
towards responsible consumption and recycling.
AVROs existing operations, commitment to recycling and sustainability,
and plans for expansion and communication strategies are intricately connected, forming a
cohesive narrative of a brand that not only excels in the plastic furniture market but
also champions environmental consciousness and responsible business practices.
FINANCIALS PERFORMANCE AND HIGHLIGHTS
The financial performance during the financial year 2022-23 has been
summarized below:
Particulars (Rs. Crore) |
FY23 |
FY22 |
YoY Change |
Revenue From Operations |
80.01 |
64.74 |
23.59% |
| Total Income |
82.34 |
65.20 |
26.29% |
| EBITDA |
8.54 |
5.62 |
51.96% |
| EBITDA Margin |
10.46% |
8.62% |
184 bps |
| PBT |
5.83 |
3.92 |
48.72% |
| Net Profit |
4.15 |
2.97 |
39.73% |
| Net Profit Margin |
5.04% |
4.56% |
48 bps |
| EPS ( ) |
4.12 |
2.95 |
39.66% year) |
The Companys revenue from operations increased to 80.01 Cr in FY
2023 compared to 64.74 Cr in FY 2022. The EBITDA has grown from 5.62 Cr to 8.54 Cr. EBITDA
in FY2023 is 52 % higher than the previous financial year. Net sales operations in FY2023
have been approx. 24% higher than FY2022. PBT for FY 2023 is appx. 49% higher than FY 2022
at 5.83 Cr and Net Profit numbers are appx. 40% higher than FY 2022 at 4.15 Cr.
For FY23 Offline sales contributed 76.43 Cr to the revenue which is
approx. 95.53% of the revenue. while Online sales has contributed 3.58 Cr to the revenue
which is approx. 4.47% of the revenue.
In accordance with the SEBI (Listing Obligations and Disclosure
Requirements) (Amendment) Regulations 2018, the Company is required to provide details of
changes (i.e. change of 25% or more as compared to the key financial
immediatelypreviousfinancial ratios, along with detailed explanations. The following are
list of important financial ratios:
Ratio |
As at 31 March,2023 |
As at 31 March,2022 |
% variance |
Reason for variance |
Current Ratio (in times) |
1.94 |
1.62 |
(19.75) |
|
Debt-Equity Ratio (in times) |
0.47 |
0.37 |
(27.02) |
Increase in the ratio is due
to increase in non-current borrowings and utilization of working capital during the year |
Interest Coverage Ratio (in
times) |
7.59 |
10.63 |
(92.41) |
Increase in ratio because
the amount of interest on borrowings increased due to increase in borrowings |
Return on Equity (in %) |
18.24 |
15.51 |
(17.60) |
|
Inventory Turnover Ratio (in
times) |
12.20 |
16.69 |
26.90 |
The ratio is decreasing due
to increase in closing inventory |
Trade Receivables Turnover
Ratio (in times) |
4.53 |
4.39 |
(3.19) |
|
Trade payables turnover Ratio
(in times) |
10.85 |
9.97 |
(8.82) |
|
Return on Net Worth (in %) |
16.71 |
14.39 |
232.39 bps |
Increase in ratio due to
increase in profit |
Net Profit Ratio (in %) |
5.19 |
4.60 |
(12.83) |
|
Operating Profit Margin (in %) |
7.7 |
7.96 |
(0.19) |
|
| Net Profit Margin (in %) |
5.04 |
4.56 |
10.53 |
|
Risks and Concerns
AVRO recognizes that operating in the business landscape comes with
inherent risks that can emanate from various sources, encompassing product distribution,
governmental policies, and technological shifts. To ensure its sustained performance over
the long term, the company places a paramount emphasis on the identification, analysis,
and effective mitigation of these risks through well-suited control measures.
The process of risk identification and assessment remains ongoing, with
a commitment to promptly implement appropriate measures to curtail their potential impact.
The efficacy of diverse risk reduction measures is subject to periodic evaluation,
underlining the companys dedication to refining its risk management strategies. At
regular intervals, the Board scrutinizes the entirety of the Risk Management protocol to
maintain its relevance and efficacy.
The company operates within the realm of foreign exchange exposure due
to its reliance on imported machinery and molds. The volatility in the exchange rate
between the US Dollar and the Indian Rupee holds the potential to adversely affect the
companys financial status and outcomes. Furthermore, the company is not immune to the
volatility of prices, both foritsfinishedproducts and the raw materials it employs. The
companys approach to managing these risks extends to adept inventory management
strategies, often coupled with the judicious allocation of cost increases to the end
customer. Additionally, the ongoing pandemic situation introduces a unique set of
challenges. The shifts in consumer behaviour and disruptions in production owing to
lockdowns for the orquarantinescan companys offerings.
The company remains resolute in its proactive and proficient handling
of risks, as it acknowledges risk as an inherent facet of conducting business. Rigorous
and regular evaluations of both internal and external risk factors underscore the
companys commitment to vigilance. These risks are in a constant state of flux, both in
terms of their potential consequences and the probability of occurrence. Thus, the company
consistently monitors the external landscape for emergent threats and gauges their
potential ramifications on overarching corporate objectives. The Board of Directors plays
a pivotal role in overseeing and evaluating the companys all-encompassing risk management
framework. The companys robust approach encompasses the assessment and management of an
array of risks that span the spectrum. These encompass competition risk, concerns related
to safety and sustainability, adherence to compliance norms, the integrity of information
security, the availability of crucial raw materials, and the intricate dynamics posed by
the pandemic. AVROs commitment to proactive risk management is deeply ingrained in its
operational ethos, ensuring a resilient and adaptable stance in the face of an
ever-evolving business landscape.
Human Resources
Recognizing the invaluable contribution of its employees, Avro Limited
places paramount importance on nurturing and enhancing its human resources. The companys
dedication to this endeavour is evident through its strategic focus on key aspects of
human resource management, which encompasses effective communication, continuous learning
and development, rigorous performance management and appraisal processes, and meticulous
recruitment practices.
Central to the companys approach is the provision of regular training
to employees, designed to empower them with the skills and knowledge necessary for
achieving operational excellence, maintaining high productivity levels, and upholding
stringent quality and safety standards. Avro Limited remains steadfast in its commitment
to cultivating an exceptional working culture that revolves around maximizing human
potential. The company has implemented proactive measures aimed at fostering a tranquil
and harmonious workplace environment. It firmly believes that its rapid growth trajectory,
coupled with the establishment of an inclusive and welcoming workplace, has significantly
contributed to its ability to attract a diverse pool of exceptional individuals.
Avros sustained success in attracting and retaining top-tier
talent is underpinned by its unwavering dedication to human resource development, its
investment in fostering a positive work environment, and its resolute focus on creating
opportunities for continuous improvement and growth.
Internal Control Systems and Their Adequacy
The company has established a comprehensive system of internal controls
that are well-suited to the companys size and business nature. These internal control
mechanisms serve a crucial purpose: to optimize the efficiency of business operations,
protect the companys valuable assets, ensure adherence to established policies and
procedures, and to proactively identify and prevent errors and fraudulent activities.
Additionally, they play a pivotal role in ensuring compliance with relevant laws and
regulations while also upholding the accuracy and dependability of financial reporting and
statements. Its worth noting that the company maintains a vigilant oversight of its
corporate policies to ensure ongoing adherence. The Company is strengthening its Internal
Control System every year as per the need of laws and transactions of the Company.
The responsibility of conducting internal audits falls upon the
companys Internal Auditor. These internal audits are conducted at regular intervals,
serving as raw meanstoprovide material costs, management with a degree of
confidence in the integrity of transactions. To assess the ongoing effectiveness of the
internal control systems, the Internal Auditors periodically evaluate their efficiency.
Furthermore, the internal control specifically over financial validated by the companys
statutory auditors, providing an additional layer of assurance.
Recognizing the significance of maintaining transparent
financialreporting and robust internal controls, the company has instituted an Audit
Committee. This committee plays a crucial role in facilitating communication between the
Statutory Auditors, Internal Auditors, and the management. Its responsibilities span a
wide array of matters, encompassing financial reporting, internal control assessment, and
other pertinent areas.
The companys commitment to internal controls, transparent
financialreporting, and maintaining a strong audit framework underscores its dedication to
operational excellence and accountability. Through its systematic approach and the
engagement of internal and external audit expertise, the company aims to foster trust
among stakeholders and ensure the integrity of its financial practices.
Cautionary Statement
The statements provided in the Management Discussions and Analysis
section are grounded in presently accessible information and a series of suppositions
encompassing the selling economy, variables influencing prices, shifts in consumer demand
and preferences, pertinent laws and regulations, as well as additional economic and
political aspects. Its important to note that the companys forthcoming performance
projections and assumptions reporting is rigorouslytestedand lack a guarantee of precision
from the managements side. Consequently, readers are cautioned that the actual outcomes
might deviate from what is articulated and inferred in the statements.
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