continental securities ltd share price Management discussions

Indian financial service sector is diversified, comprising of entities such as commercial bank, co- operatives, insurance companies, Pension funds, mutual funds, Non-Banking finance companies and various other entities.

1. Industry Structure and Developments

NBFCs (Non-Banking Financial Companies) have been playing a complementary role to the other financial institutions including Banks meeting the funding needs of the economy .They have fill the gaps in the availability of financial services that otherwise occur in the un- banked segments of the society and under-served areas. NBFCs have been at the forefront of fulfillment to the financial needs and creating livelihood sources in rural and semi urban areas. Thus NBFCs have all the characteristics to enable the government and regulator to achieve the mission of financial inclusion in the given time.

NBFCs segment has continuously growth in the last few years and now being recognized as complimentary to the banking sector due to implementation of innovative market strategies, customer oriented services, and simplified procedures.

2. Opportunities and threats

The company mainly focus to providing financial services to rural and semi-urban areas .The opportunities of the Company further depends on introduction of fresh funds. Being a NBFC company, company is facing inflationary pressure, Economic Cycle, Regulatory risk , etc. The competition in the NBFC division is intensifying on account of rising number of players. Also, rising stringent restrictions by the RBI on the NBFCs are restricting their borrowing abilities. However, as a matter of deliberate policy, the Reserve Bank has been discouraging NBFCs from engaging in public deposit mobilization activities.

3. Segment-wise or product-wise performance

The Company is operating in one segment only .i.e making loans to the small borrowers .there is a slighty growth in the business of the Company. The Company is making due efforts to introduce new finance to enlarge its business.

4 .Internal control system

The company has established its internal control system commensurate with the requirements of its size, nature, complexity of its business and ensure proper maintaining of accounting records and providing reliable information. The Company has appointed M/S Ajay Khandelwal & Associates, Chartered accountants Jaipur as internal auditors of the Company.

5. Human Resource Management

Human resources are a valuable asset for any organization. The company is giving emphasis to upgrade the skills of its human resources .This is in keeping with its policy of enhancing the individual growth potential within the framework of corporate goals