Ceenik Exports (India) Ltd Management Discussions

a) Industry Structure and Development:

Garment and apparel industry is susceptible to fast changing trends and styles. It is a labour-intensive industry and requires skilled and unskilled labour in large numbers. Further, the industry is pre-dominated by unorganized sector, leading to a cut throat competition in certain segment of the industry from unorganized sector. Internationally also the industry is facing tough competition from countries like Bangladesh and Vietnam where labour is very cheap.

The Companys other business activities viz. property leasing and hostel business has done well compared to previous year. Though the property market in general was sluggish through-out the year under review, property leasing business had shown some sign of improvement.

b) Opportunities, Risk, Concerns and Threats:

It is a fact that many developments in Indian economy are triggered by globalization as one world market are under cut-throat competitions, the prime opportunity lies in meeting customers expectations for new designs and trend, prompt response, marketing of products into new market, Economic growth and manufacturing of value-added products to boost unit value realization.

The Company is totally out of the garment and apparel manufacturing activity and processing division, a lossmaking division.

The Company will now focus on its leasing of property business and hotel business, which will improve its profitability.

The Company acknowledges that risk is an integral and unavoidable component of the business and intends to manage the risk proactively and efficiently.

Your Company will try to start its activity with value addition products gradually to make its share in global market and expecting growth in the times ahead.

c) Economy:

As per the provisional estimates of Central Statistics Office (CSO), the Indian Economy is estimated to grow at a decent pace. Despite marginal slow down over the last year, India has cemented its credentials as the worlds fastest expanding major economy in the world. Going forward, the economy is expected to display a better performance, considering the pick-up in consumption and private investments. Besides, a high inflation expectation for financial year 2024-25 has created further room for monetary easing by the RBI, which is expected to support the growth momentum. The recent elections have led to formation of a stable government at the Centre. The government is expected to carry forward the reforms agenda. It will continue to focus on building infrastructure. Higher spending on roads, railways, airports, waterways and affordable housing will boost the economy and provide economic opportunities for citizens to grow and improve their income levels. While global economy is likely to remain muted on the back of the ongoing trade dispute between US and China, the domestic economy should benefit from the governments investment momentum. In addition, the governments boost to rural India in the form of direct benefit transfer will give an impetus to consumption.

d) Future Outlook:

Followed by high prices of premises, the rentals are constantly increasing. With more premises of the Company coming under lease, the rental income of the Company is expected to increase substantially. Hostel business is also expected to show healthy growth. With expenses under control, your Directors expects to earn modest profit in coming years.

e) Material development in Human Resources / Industrial Relation front:

There have not been any material/major development in human resources front and industrial relations have been cordial.

f) Internal Control System and their Adequacy:

The Company has in place adequate and effective internal control systems and processes commensurate with the nature of its business and the size and complexity of its operations. The Company has implemented robust policies and procedures, which inter alia, ensure integrity in conducting its business, safeguarding of its assets, timely preparation of reliable financial information, accuracy and completeness in maintaining accounting records and prevention and detection of frauds and errors. These are tested and evaluated on a regular basis for improvement.

g) Discussion on Financial Performance with respect to Operational Performance:

This aspect is dealt with in detail in the Directors Report.

h) Cautionary Statement:

Statements in the Annual Report, particularly those which relate to Management Discussion and Analysis may constitute forward looking statements within the meaning of applicable laws and regulations. Although the expectations are based on the reasonable assumption, the actual results might differ.

i) Details of key financial ratios, along with detailed explanations therefore: