Charms Industries Ltd Management Discussions.


The global expansion has weakened. Global growth for 2018 is estimated at 3.7 percent, as in the October 2018 World Economic Outlook (WEO) forecast, despite weaker performance in some economies, notably Europe and Asia. The global economy is projected to grow at 3.5 percent in 2019 and 3.6 percent in 2020, 0.2 and 0.1 percentage point below last Octobers projections. Global growth remains subdued. Global growth is forecast at 3.2 percent in 2019, picking up to 3.5 percent in 2020 (0.1 percentage point lower than in the April WEO projections for both years). GDP releases so far this year, together with generally softening inflation, point to weaker-than-anticipated global activity.

Growth is projected to improve between 2019 and 2020, however, close to 70 percent of this improvement relies on an improvement in growth performance in stressed emerging market and developing economies and is therefore subject to high uncertainty. The International Monetary Fund (IMF) has cut its projection for Indias economic growth by 0.3 percentage point to 7 per cent for 2019-20 due to subdued domestic demand. For the next financial year, the projection was also cut by 0.3 percentage point to 7.2 per cent.


The Company is a leading RBI registered Authorized Dealer Category-II for money changing business.

In money changing, the Company provides an array of products and services including buying and selling of foreign currency notes, servicing of co-branded International prepaid multicurrency travel cards, issuance of foreign currency demand drafts, travellers cheques and outward telegraphic remittances, including outbound remittances

towards student fees, film shoots, tour remittances etc. and also extend encasements of foreign currency demand drafts, travellers cheques and forex prepaid cards. The Companys strength is its wide network developed over the years, its brand image and number of allied products.


As per World Travel & Tourism Economic Report 2019 The direct contribution of Travel & Tourism to GDP is expected to grow by 3.6% pa to USD4, 065.0bn (3.5% of GDP) by 2029. was USD8, 811.0bn in 2018 (10.4% of GDP) and is expected to grow by 3.6% to USD9, 126.7bn (10.4% of GDP) in 2019.

As per World Bank Reports, India is in a period of unprecedented opportunity, challenge and ambition in its development. Already the worlds third largest economy in purchasing parity terms, India aspires to better the lives of all its citizens and become a high- middle income country by 2030, well before the centenary of its independence.

Long-term GDP growth has become more stable, diversified, and resilient. Over the next few years, India is expected to grow at well over 7 percent per year, with progress being buttressed by dynamic reforms in the macroeconomic, fiscal, tax and business environments.

In recent years, the country has made a significant dent in poverty levels, with extreme poverty dropping from 46 percent to an estimated 13.4 percent over the two decades before 2015. While India is still home to 176 million poor people, it is seeking to achieve better growth, as well as to promote inclusion and sustainability by reshaping policy approaches to human development, social protection, financial inclusion, rural transformation, and infrastructure development.

India will retain its position as the worlds top recipient of remittances this year with its diaspora sending a whopping USD 80 billion back home, the World Bank said in a report Saturday. India is followed by China (USD 67 billion), Mexico and the Philippines (USD 34 billion each) and Egypt (USD 26 billion), according to the global lender.

The Government of Indias initiatives in boosting up its public expenditure on Infrastructure development will give an impetus to its "MAKE IN INDIA policy. India is being the most sought after Investment destination for many Investors world over. Hence, this augurs well for the Company business as there will be inflow of Capital Investment giving a boost to Companys Money changing business.

In money transfer, for 2019, it is projected that remittances growth for the region will slow to 4.3% due to a moderation of growth in advanced economies, lower migration to the GCC and the benefits from the oil price spurt dissipating.

Reversing previous years sharp decline (8.9 per cent in 2017), Remittances to India picked up sharply by 9.9% to $69 billion in 2018, reversing the previous years dip, but were still short of $70.4 billion received in 2015. Payments from immigrants back to their home countries rebounded to reach a new record in 2018.

The upsurge is likely to continue into 2019 on the back of stronger economic conditions in advanced economies (particularly the US) and an increase in oil prices which is beneficial to Gulf Cooperation Council countries. 2019-20 witnessed consolidation of money transfer business in India with few peer competitors selling their money transfer business to an Indian arm of overseas entity and hence in money transfer business the challenges are expected to be different than what was hitherto witnessed in the last two years.

Further, the comparative slower growth globally as compared to Asian Countries coupled with the challenges faced through the advancement of the world digital economy and India too encouraging digitization, the Companys management though expects new challenges, it does not forsee any immediate threat to its core business activities and in fact its efforts are being channelized to seize the newer methodologies to counter the challenges faced.


Company has laid down a detailed risk management policy, customer identification and acceptance procedure. Credit procedure envisaged by the Companys credit policy ensures identification of the operational and business risk while entering into any transactions with the prospective customers. The financial risks involved are evaluated through a well laid down procedure. However, all the inherent business risks are adequately insured by the Company. Exchange rate volatility faced is not only faced by the Company but is attuned to the forex industry globally. To mitigate the said risks Company closely monitors the exchange rate movement and hedges its liability on this account in the Forwards Forex market. The inward remittances due to the Company in its Money Transfer business act a natural hedge for its Money Exchange business.


The Company has already put in place an elaborate Internal Control and Internal Audit systems. The system ensures adequate periodical checks and balances are exercised. Continuous monitoring by the Internal Audit team of these checks and balances due to the inherent risks associated with the nature of Companys activities ensures compliance of the regulatory framework of RBI & FIU. The Audit team is suitably guided and updated by the Audit Committee of the various regulatory requirements from time to time. The Company has put in place a strict credit policy for extending credit to its corporate customers. The same is continuously monitored and reviewed periodically for any updations to ensure funds at Companys disposal are being judiciously utilised and efficiently managed visa-vis the business requirements. The Management Discussion and Analysis explaining the objectives of the Company, the opportunities and threats, the outlook for the future, the risks and concerns have

to be read with the meaning of relevant applicable laws and regulations. The actual above. As in any other business the performance of the Company is totally dependent on the market conditions of demand and supply, the volatility in exchange rate, the Government policy & regulations, the economy of the country and other factors.


Our companys operations belong to a single segment and therefore no segment wise performance given.


Your Company being part of the sector, human resources has always been the main pillar for all the activities of the Company. Customer Satisfaction being the ultimate objective of the Company, to ensure sustained business growth. Companys focus has been to improve the staffs contribution towards the various services offered. To achieve this objective Company has ensured that all its employees receive continuous update on the Companys policies as well as the regulatory framework.

For and on behalf of the Board


Harsad Shantilal Gandhi

Chairman & Director

(DIN: 01056779)

Place: Ahmedabad

Date: 12th August, 2019