CCL International Ltd Management Discussions.

Readers are cautioned that this Discussion and Analysis contains forward-looking statements that involve risks and uncertainties. When used in this discussion, the words "anticipate", believe", "estimate", intend, "will", and "expected" and other similar expressions as they relate to the Company or its business are intended to identify such forward looking statements. The Company undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of performances or achievements and risks and opportunities could differ materially from those expressed or implied in such forward looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of their date. The following discussion and analysis should be read in conjunction with the Companys financial statements included and notes thereto.

[Industry Structure & Future Outlook

Indias Gross Domestic Product (GDP) grew at a rate of 7.2% in the third quarter (October-December) from 6.3% in the second quarter (July-September) of the fiscal year 2017-18, surpassing expectations on the back of a rebound in industrial activity, especially manufacturing and construction, and an expansion in agriculture. Indias fY18 growth projection was revised marginally upward to 6.6% from 6.5% estimated earlier, compared with 7.1% in FY17, according to data released by the ministry of Statistics and Programme Implementation. The combined index of the eight core industries rose 6.7% in January 2018 compared with 4.2% in December 2017, according to data released separately by the government. The numbers indicate that the economy had shaken off the effects of demonetization and is recovering from the implementation of goods and services tax (GST). The International Monetary Fund (IMF), in its biannual World Economic Outlook (WEO), projected Indias GDP growth rate at 7.4% in 2018 and 7.8% in 2019 as against Chinas 6.8% and 6.4% during the same period, making it the fastest growing economy among emerging economies. In addition to the introduction of GST, the year also witnessed significant steps being undertaken towards resolution of problems associated with nonperforming assets of the banks, further liberalization of FDI, etc., thus strengthening the momentum of reforms.

The construction sector in India, which employs

more than 35 million people, is the second largest employer, next only to agriculture. Therefore, any improvements in the construction sector affect a number of associated industries such as cement, steel, technology, skill-enhancement, etc. As per the government reports, the sector is valued at over $126 billion. It also accounts for more than 60 per cent in total infrastructure investment. About half of the demand comes from the infrastructure sector, and the rest is driven by the real estate sector and other industrial activities. Indias construction industry will continue to expand over the forecast period (2016-2020), with investments in residential, infrastructure and energy projects continuing to drive growth. The industrys output value in real terms is expected to rise at a compound annual growth rate (CAGR) of 5.65% over the forecast period; up from 2.95% during the review period (2011-2015). There are certain challenges associated with Indias construction industry outlook. Limited funding, slow policy reforms and a weak currency are factors that will continue to limit the growth potential during the early part of the forecast period. Due to industrialization, urbanization, a rise in disposable income and population growth the demand for construction services is set to rise. Government efforts to improve the countrys residential and transport infrastructure will also support growth.

The construction industry makes significant contribution to Indias GDP, both directly and indirectly. Any change in the construction sector has a direct impact on ancillary industries such as cement, steel, power and petroleum, technology, etc.

[company overview

CCL International Limited (CCL) with its strong and timely executional capabilities, over the last five year, leveraged its experience and established its market position in civil construction projects. With Large fleet of sophisticated construction equipments, CCLs has an ability to execute with quality, technically complex and high value road construction projects.

[business operations

During the year under review, the company bagged number of new projects in vertical it operates its Business activity regardless of uncertainties and challenges arising in the market conditions; the company has successfully demonstrated strong value addition in the infrastructure sector. In the year

under review, the company has not only accomplished the ongoing projects in an efficient manner but has also acquired various new and innovative projects in the field of Infrastructure Segment. Your Company as a group offers the vast spectrum of infrastructure services in the areas of Construction of bridges, Construction of roads, and Construction of highways. During the year under review, the Company stepped in contracts with various other organizations like Border Road Organization, National Highways Authority of India, Government of Assam, Government of Haryana, PWD Department Government of Meghalaya which would surely enhance the growth, goodwill and public reputation of your company and would proved out to be more profitable in the coming months.

Our other areas of operation includes Trading of Steels, Non-Ferrous Metals, Fabrics , Cements that have also proved out to be profitable for the company and remarks a considerable increase in profit turnover of the Company. It is needed to be pointed out that as your company is bifurcated into two major business operation i.e. trading & infrastructure segment.

[review of financial operations

The Company during the period under review mainly concentrated on the Infrastructure business. As a result of which, a substantial portion of companys revenues are derived from infrastructure projects, these projects provide opportunities for large revenue and profit contributions. The performance of the Company in the current financial year is satisfactory considering the challenges faced by the construction industry. A comparative study of the financial performance of the Company as compared to the previous financial year is given hereunder:

Particulars 2017-18 2016-17
Income from operations 3321.87 6539.50
Other Income 78.20 558.93
EBIDTA 356.98 581.92
Net Profit 8.39 310.25
Earning Per Share 0.04 1.62

Share Capital : The Companys paid-up share capital stood at Rs. 19, 19, 26,000 as on March 31,2018.

Reserves and Surplus : The Companys reserves increased from Rs. 2220.08 Lakh in 2016-17 to Rs. 2228.47 Lakh in 2017-18.

Income from Operations : The Companys financials reflect decline in Income from Rs. 6539.50 Lakh in 2016-17 to Rs. 3321.87 Lakh in 2017-18.

EBIDTA : The Companys EBIDTA decline from

Rs. 581.92 Lakh in 2016-17 to Rs. 356.98 Lakh in 2017-18.

Net Profit : The Companys net profit stood at Rs. 8.39 Lakh in 2017-18.

Gross Block : The Companys gross block increased from Rs. 2870.76 Lakh in 2016-17 to Rs. 2973.64 Lakh in 2017-18 on account of growing project volumes. The Company is making conscious efforts to increase the property, plant and equipment base so as to increase the element of mechanization in the execution of projects to reduce manpower cost and for completion of projects even ahead of the time schedule.

[resources and liquidty

Your Company presently maintains conservative financial profile so as to build its future based on sound financial resources.

RISK MANAGEMENT

Your Company recognizes the need to control and limit risk, which it faces in day to day course of the business. The Company is exposed to certain financial risks, principally interest rate risk, construction risk and risks associated with competition among others. These risks are managed through risk management policies that are designed to minimize the potential adverse effects of these risks on financial performance of the Company. The following section discusses some of these risks and steps taken by man infra to mitigate such risks.

• Competition Risk: With increased project awarding by the government, the road and construction industry is expected to attract several domestic as well as international players. This increase in competition may lead to an aggressive bidding environment, resulting in price cut and low operating margins as well as lower market share of project awards. Risk Mitigation - With five years of industry experience and led by a proven management team, who have honed their project managing skills right from the drawing board to the final execution, the Company is confident of meeting present and future competition and enjoy continued growth. To further mitigate this risk, where considered prudent, the Company forms strategic partnerships and joint ventures with quality players. This facilitates synergies both in the financial and technical and enables it to compete with the larger players.

• Slow-down in Road Sector : Any slowdown on part of the government to award road projects could adversely affect growth prospects. Risk Mitigation - The present government has taken focused steps to ensure that infrastructure creation moves at an accelerated pace, thus reducing the possibility of this risk to a considerable extent. Moreover, the Company already has sufficient order backlog to ensure growth momentum in the medium term.

• Construction Risk: Infrastructure projects involve complex design and engineering, significant procurement of equipment and supplies and extensive construction management and other activities conducted over extended time periods, sometimes in remote locations. This could lead to cost-time overruns, thereby impacting profitability. Risk Mitigation - CCL with its vast experience of project management, balanced capital structuring and efficient cost control measures is well geared to mitigate this risk.

• Interest Rates: Rising interest rates during the life span of a project, fuelled by inflation, can decrease profit margins. Risk Mitigation - The Company factors this risk into the cost of project before bidding for it. Despite this, the Company is open to resorting to interest rate hedging in case the need arises.

~HUMAN RESOURCES ~

Manpower is biggest strength in construction sector. Your Company maintains its focus on its Human Resources. It believes that peoples contribution is the main engine for growth. We deliver on the strength of our people and in a dynamic business environment. Company policy entrails looking for qualified, talented and enthusiastic individuals and building up of a rich human resource base. Our HR team focuses on employee training, inculcation of values and enhancing functional expertise. The key HR objective is to ensure that our employees are aware of the role they are expected to play in the organization to be able to drive organizational momentum.

We have manpower comprises professionals from diverse backgrounds like engineering, finance, taxation, secretarial, legal, management, business, supervisors, operators and sub-staff, skilled and semi-skilled workers. The top management conducted several discussions with their employees to discuss multiple issues towards discussing leadership qualities, values, responsibilities, freedom to work and take decisions. Going ahead, the Company will continue to invest in its people to strengthen its delivery model.

All employees are working in harmonious and teamwork atmosphere which are at all time high. The Company has a team driven work process with completely flat organization structure. This not only helps us nurture leaders but also give us capable and assured colleagues at all levels.

INTERNAL CONTROL SYSTEMS AND THEIR

ADEQUACY

The Company has a proper and adequate system of internal controls. This ensures that all transactions are authorised, recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition. In addition there are operational controls and fraud risk controls, covering the entire spectrum of internal financial controls. Management reviews and supplements the process of internal financial control framework. The internal financial control framework has been designed to ensure that the financial and other records are reliable for preparing financial and other statements and for maintaining accountability of assets. In addition, the Company has identified and documented the risks and controls for each process that has a relationship to the financial operations and reporting

DISCLOSURE OF ACCOUNTING TREATMENT

The financial statements of the Company have been prepared in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014.

VALUE CREATION

Your Company is continuously striving to create value in all spheres of its activities. This encompasses not only value for its customers but also for its stakeholders. The Company has adopted Accounting Standards incorporating best practices and have moved towards transparency in its reporting .We will continuously endeavor to provide insight on the operation of the Company to aid all stakeholders.

The Board would like to place on record its deep sense of appreciation for the continued confidence reposed in the company by the shareholders as well as the sincere efforts put in by the executives and staff at all levels for progress of the company.

By Order of the Board of Director

Sd/-
Place: Delhi (Rama Gupta) Chairman
Dated: 14.08.2018 [DIN 00080613]