Calcom Vision Ltd Management Discussions.

Global Economic Overview

Due to persistent impact of growing trade disputes between the US and China, rising economic uncertainties in Europe over the impact of the UKs withdrawal from the European Union, the Global economy was showing clear signs of slowdown along with falling commodity prices. The outbreak of novel coronavirus (Covid-19) in the beginning of 2020 has shocked the world and impacted every aspect of human lives, thus leading to drastic economic contraction. Covid- 19 related lockdowns has disrupted the global supply chains and global trade has suffered further setback. With the pandemic, real GDP in emerging market and developing economies is expected to decline by 3.3 percent in 2020.

The COVID-19 recession has affected small and medium enterprises (SMEs) particularly hard. These firms typically are more vulnerable than their larger counterparts, reflecting, among other factors, their limited buffers and access to credit. Consequently, liquidity and solvency risks are bound to increase, putting both SME jobs and debt at risk.

This crisis is disproportionately affecting vulnerable workers, putting at risk much of the progress achieved before the crisis and likely exacerbating remaining gaps. Both advanced and emerging market economies are expected to be in recession in 2020.

World Economic Output Growth in %
2019 2020 P 2021 P
World Output 2.8 -4.4 5.2
Advanced Economies 1.7 -5.8 3.9
Emerging Market and Developing Economies 3.7 -3.3 6.0
Emerging and Developed Asia 5.5 -1.7 8.0
China 6.1 1.9 8.2
India 4.2 -10.3 8.8
ASEAN- 5 (Indonesia, Malaysia, Philippines, Thailand, Vietnam) 4.9 -3.4 6.2

Governments and central banks across the world are rolling out fiscal and monetary support measures to combat the pandemic and minimize the impact of a catastrophic economic downturn. However, the growth prospects are contingent on factors like the duration of shutdowns, absence of second wave of pandemic, consumer confidence, the implementation of fiscal and monetary policy support and finally the evolution of vaccine for the virus.

Indian Lighting Industry

Indian EMS Market size was approx. USD 6 billion in FY20 & expected to touch USD 40 billion by 2025 at a CAGR of 47% from 2020 to 2025.

The rising awareness about cost & energy efficiency & ecofriendliness of LED lighting among the consumers & innovative & differentiated products will continue to drive the demand for LED lighting.

The Indian lighting industry continues to be competitive but exhibited a relative stabilization of prices in second half of FY20 specifically in the consumer lighting space. Major growth drivers of the industry are rural electrification, infrastructure development, construction of new homes, and consumer trends towards better light. Government schemes such as Deen Dayal Upadhyay Gram Jyoti and UJALA (LED lighting) schemes are a major impetus to the industrys growth. Connected lighting solutions have found successful application in residential and commercial domains which has added further to the growth of the industry. Source:

Company Overview

The Company is engaged in manufacturing and selling of complete Light Emitting Diode (LED) lighting and related electronic products and find application in domestic segment. The operations of the Company can be broadly classified as Electronics Manufacturing Services (EMS) wherein it undertakes manufacturing of any electronic component and supplies to other equipment manufacturers (OEMs) and Original Design & Manufacturing (ODM) wherein the Company carries end-to-end activity including designing for the lighting product. About 100% of the revenue is derived from the EMS segment.

The Company R&D is well equipped with cutting-edge tools & sophisticated software and most importantly, a highly qualified and experienced talent pool. R&D Team focuses on Cost effective design solution along with aesthetics & improvements in electronics hardware designs, including mechanical designs, through systematic approach of design verification, validation & Test trials runs of products.

The Company has started the production of Low Wattage Bulbs and plans to increase the assembly lines further to meet the increasing demand. We have imported Automatic Bulb Assembly Machine to increase the production capacity and improve the quality.

Your company is now focusing mostly on LED bulbs. It designed bulbs which are more reliable and are able to withstand voltages upto 440V and surges upto 4000V. Your company has designed bulbs for various wattages as per new BEE standards which will become applicable from January 1st, 2021. These bulbs are more energy efficient, as the lumen output per watt is increased by almost 15%.

The Company had tied up with PANASONIC LIFE SOLUTIONS INDIA PVT LTD and BAJAJ ELECTRICALS LIMITED as one of our privileged customers. They both are the major brands in the Lighting Sector. The company is also in discussion with other major brands and expects to conclude the business in the forth coming year.

The Company is focusing to increase efficiency and performing effectively in the dynamic business environment. We are continuing with the Annual Review Workshop Program with Extended Management Team to review past years performance, do regular SWOT analysis and finalize the Key Focus Areas for future.

We are continuing with the Key Decisions taken in the workshop as under:

> Formal "Monthly Performance Review (MPRs)" with Core Management - Review of past month performance and next month plan.

> Defining Key Result Areas (KRAs) and measurable Key Performance Indicators (KPIs) for each function - Sales &Marketing, Purchase/Procurement, Production, Finance & Accounts, Quality, R&D and HR.

> Holding Daily Cross Functional Review meetings for monitoring of sales, production and purchasing progress, to review and expedite resolution of operational issues.

> Revamping of Production Floor Layout to achieve Increased Capacity, Improved process flow and optimized equipment usage.

> Extending existing production lines to enhance capacity, and achieve seamless process flow and elimination of non-value add efforts & time.

> Continuing with 5S and Kaizen Improvement Framework.

> Continuing with the Governance model involving daily and monthly audits to track the progress & improvements made.

> Identifying and taking Cross Functional Projects.

Your Company is also conducting the training programs for each department according to their scope and this will enhance the knowledge and help them to implement the changes. These training programs are important and necessary for the updation of the knowledge and new technology. These trainings also helps to make the company dynamic for adoption of any changes easily.

Due to COVID-19, Company faced workforce shortage as most of the workers left for home towns and couldnt come back due to lack of transport. Even people residing in NCR region could not come for long time because of interstate transport restrictions. Fresh recruitment was done for the manpower required for the production activities. The Company is conducting constantly training for the fresh employees, so that they can work efficiently. This is however resulting in higher costs.



1. The Country has got a stable government with the Victory of BJP in general elections of 2019 lead by PM Modi. The positive environment created from initiatives such as Make in India, Start-Up India, GST implementation, Skill India, Digital India, has increased the confidence of major world players and investors are stepping up investments in India. Government Policy has provided complete aid for the growth and liberalization of the consumer electronic manufacturing industry.

2. The US-China trade war is likely to have a positive impact on Indian economy. US have threatened to impose higher duties to Chinese imports, with this US Companies would look into India for sourcing their requirements.

3. The demand of the LED bulbs in on the rise and there are not many organized manufacturers in the industry.


1. The major sales are from OEM Business which can affect the performance of the company eventuality. For this the Company has decided to diversify its customer base.

2. There is huge price erosion in LED products coupled with fierce competition, the Company has to continue developing newer products and continuously looking for cost reduction opportunities.

3. Uncertainties and cashflow problems because of COVID-19.


The Company sold Lighting Products valued at approx. Rs. 4736.23 Lacs in the year 2019-20 as compared to Rs. 5232.28 Lacs in the year 2018-19. The main reasons for lower performance were:

1. The business with the key customers didnt pick up because of te cancellation of major government contracts with them.

2. The general slowdown in the economy

3. Lockdown imposed by the government in March, 2020.


The company has decided to make strategic shift to focus on Low Wattage Bulbs in the product mix. Besides it will continue to focus on:

Scale Up

o Added Significant Bulb capacity and more in pipeline, o Conclude business with new customers, o Enhanced Product portfolio with existing customers

Process Improvements

o Process Efficiency and Transparency o Regular Monitoring of Inventory Levels, Collections, Payments

Seamless Coordination among functions

o Teamwork across departments

o Alignment with the Organization Goal

Customer Delight

o Competitive Prices o Deliver quality products and services o Timely delivery with minimal disruptions o Quick Response times.

In view of the above Strategic Decisions, the Company is expecting a good growth in the revenue and profitability in the coming year inspite of the Corona Pandemic. The Company had tied up with PANASONIC LIFE SOLUTIONS INDIA PVT LTD and started producing LED Bulbs for them in the month of June, 2020. We produced little over 200,000 Bulbs in the month of June and have been able to ramp up to 1 Million Bulbs in the month of October, 2020. For the production of the same we have hired the new workforce and trained them for the production activities. The company expects much higher growth in the coming years.


The Company has an appropriate system of internal control. Fixed Assets of the Company are inspected once a year & Stocks are counted cyclically on perpetual basis. All the financial transactions are duly authorized as per the delegation of Authority.

An Audit Committee comprising of 4 non-executive Independent Directors, one non-executive director and one Executive Director is in place to further strengthen the internal controls. The Audit Committee meets regularly to review the Audit and Accounts reports.


The sales of your Company for the year 2019-20 were Rs.4736.23 lacs as against Rs.5232.28 lacs for the previous year. The Company has sold Lighting Products 38,27,222 nos. as against 47,55,626 nos. for previous year and provided EMS Jobwork Service & Product Developments Services Rs. 140.90 Lacs as against Rs. 490.73 Lacs in Last Year. There has been a huge slide in the EMS Jobwork services. The major demand for the EMS Services comes during the festival seasons, when demand for the consumer goods peaks up and manufactures look for additional capacities during third and fourth quarter of the year. However because of the contraction in the economy the business shrank in the second half of the year and EMS Services crashed. The situation was worsened with the lockdown in the month of March, 2020. All this impacted the financial performance badly.


Human resources form the most significant element responsible for an uninterrupted growth for the Company. The Company makes all efforts in attracting, retaining, and developing the best talent required for the business to grow. The employee skills are regularly updated with training and development programmes. The Company enjoys high Employee satisfaction and motivation levels leading to higher retention and low attrition rates. The Companys human resource and industrial relation policies focuses on working together with the employees for their personal and professional development and at the same time aligning their goals with that of the Company to create a win-win situation.

Company had also gives an opportunity to employees to create value for themselves through Stock Options. Stock Options have been recognised as an effective instrument to attract talent and align the interest of employees with that of the Company, thereby providing an opportunity to the employees to share in the growth of the Company and to create long-term wealth in the hands of employees, thereby acting as a retention tool.