Chennai Ferrous Industries Ltd Management Discussions.

Annexure - i

The Company has one business segment namely generation of power from wind and waste heat recovery system .This segment is reported in accordance with the Accounting Standard 17 issued by the Companies (Accounting Standards), Rules, 2006.

The pace of economic growth of this segment namely generation of power slowed down leading to lower growth in demand for power in India. Due to meager generation of power from wind mills, the operation of wind mills has not been commercially found to be viable. Considering the same the company disposed off the wind mills during the year 2016. The waste heat recovery plant at Gummidipoondi has not generated optimum power during the year. Volatility in prices, Increase in cost of production, lack of availability of raw materials at affordable prices, environmental concerns continuous rise in cost of production, regional demand & supply inequalities, demonetization, fluctuation in INR Value against global currencies and reforms have impacted significantly the Indian Power Generation sector and resulted sharp fall in demand which ultimately impacted on profit of the Company during the year.. The high cost and short supply of power hamper the Power sector production level.

The general factors like continuous Demand for power, Lack of other energy sources, volatile raw materials prices, and policy reforms by the Government, Inexpensive import of raw materials from neighboring countries resulted in lowering prices and making the market highly competitive which affected the profitability if the company during the year We are expecting some progress in the operations of the company in future.

The management has initiated steps to revive the company with various other business opportunities with positive economic outlook and improvement in industrial growth in forthcoming years.

For and behalf of Board of directors of
Chennai Ferrous industries Limited,
Date : 5th September 2019 Chairman and managing director
Place : Chennai DIN:00595027