deccan polypacks ltd share price Management discussions

Management Discussion and analysis report on the business of the company as applicable and to the extent relevant is given below : The Company is engaged in the manufacture of HDPE/PP Woven sacks/fabric, film covers, HMHDPE / LDPE bags, which is alternate packing medium in comparison with jute or paper bags. These bags are mainly preferred by cement and fertilizer companies due to low cost, good external appearance, long shelf life, easy to handle, moisture resistance etc. In addition, the woven sacks are used for packing composite manure, food grains, chemicals and poultry products in the domestic markets. The company markets its products in the domestic market directly to the end user customers. The company has established its presence in the exports market also but in recent times has reduced its presence in the export market and mainly focused in the domestic market. Polypropylene and Polyethylene the main raw materials are available indigenously as well as through imports. The prices of the raw materials are announced, by indigenous suppliers at the beginning of the month depending upon the international prevailing prices. These prices at times are also revised during the month by the suppliers. The company does not have control on the prices of the raw material. The raw material market is controlled by few players and the company at times is not in a position to pass on the increase in price of raw materials to the buyers. The performance of the Company is also dependent on the power supply position which has direct impact on the production and capacity utilization.

Opportunities and Challenges

The woven sacks industry is highly competitive due to presence of many players. The growth and demand for packing is dependent on the growth of cement and fertilizer industries who account for major consumption of bags Cement Industry’s growth depends on the Real Estate and construction activities and Government Policies, and spending on development of infrastructure activities. Any major variation in the fortunes of these industries has direct impact on the prospectus of the woven sack industry. There is tremendous potential for the woven sacks in the domestic as well as export market, however the contributions are very much dependent upon prices of raw materials which undergo revision frequently. Price of the raw material is major factor which decides the profitability and performance of the company. In addition, the costs of other inputs also influence the bottom line.

Segment wise performance

The company is engaged in a single line of activity hence no disclosure of segment wise performance is made.

Risk and Concerns

Indian Economy is not insulated any more from the global economy. Any adverse factor in the international market also affects the domestic Indian market. Frequent changes in price of raw materials, highly competitive market, leading to price war is building pressure on the existing thin margins in the woven sack industry.

Internal Control Systems & their Adequacy

The company has adequate internal control system and an external firm of Chartered Accountants have been appointed as the Internal Auditors and the Audit Committee Reviews the Internal Auditor’s Report and suggests remedial action where required.

Discussion on financial performance with respect to operations

The overall performance of the company in terms of production, sales and turnover has been lower than the previous year. Since the production was suspended with effect from 15th July, 2014, the production figures and capacity utilization figures are not comparable with the previous year. The production was suspended due to increase in the prices of raw material and fall in the selling price of the finished goods due to stiff competitors.

Material Development in Human Resources / Industrial Relations

Human resources is an invaluable asset. The company has cordial relationship with the employees and staff.

Cautionary Statement

Statement in this "Management Discussion Analysis" may be considered to be "forward looking statements" within the meaning of applicable securities laws or regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the company’s operations include global and Indian demand-supply conditions, increased installed capacity, finished goods prices, raw materials availability and prices, cyclical demand and pricing in the company’s markets, changes in Government regulations, tax regimes, besides other factors, such as litigations and labour negotiations and power supply situation.

Declaration on Code of Conduct

This is to confirm that the Board has laid down the code of conduct for all the Directors and Senior Management Personnel of the Company. It is further confirmed that all Directors and Senior Management Personnel of the company have affirmed compliance of the code of conduct of the company for the financial year ended 31.03.2017, as envisaged in clause 49 of the listing agreement with Stock Exchanges.

Place : Hyderabad D.V. PRUDVI RAJU
Date :30-05-2017 WHOLE TIME DIRECTOR



The Members

Deccan PolypacksLimited

1. We, M. Bhaskara Rao & Co Chartered Accountants, the Statutory Auditors of Deccan Polypacks Limited ("the Company"), have examined the compliance of conditions of Corporate Governance by the Company, for the year ended as on March 31, 2017, as stipulated in regulations 17 to 27 and clauses (b) to (i) of regulation 46(2) and para C and D of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the Listing Regulations).

Managements’ Responsibility

2. The compliance of conditions of Corporate Governance is the responsibility of the Management. This responsibility includes the design, implementation and maintenance of internal control and procedures to ensure the compliance with the conditions of the Corporate Governance stipulated in Listing Regulations.

Auditor’s Responsibility

3. Our responsibility is limited to examining the procedures and implementation thereof, adopted by the Company for ensuring compliance with the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

4. We have examined the books of account and other relevant records and documents maintained by the Company for the purposes of providing reasonable assurance on the compliance with Corporate Governance requirements by the Company.

5. We have carried out an examination of the relevant records of the Company in accordance with the Guidance Note on Certification of Corporate Governance issued by the Institute of the Chartered Accountants of India (the ICAI), the Standards on Auditing specified under Section 143(10) of the Companies Act 2013, in so far as applicable for the purpose of this certificate and as per the Guidance Note on Reports or Certificates for Special Purposes issued by the ICAI which requires that we comply with the ethical requirements of the Code of Ethics issued by the ICAI.

6. We have complied with the relevant applicable requirements of the Standard on Quality Control (SQC) 1, Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements.


7. Based on our examination of the relevant records and according to the information and explanations provided to us and the representations provided by the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in regulations 17 to 27 and clauses (b) to (i) of regulation 46(2) and para C and D of Schedule V of the Listing Regulations during the year ended March 31, 2017.

8. We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the Management has conducted the affairs of the Company.

For M. Bhaskara Rao & Co.
Chartered Accountants
Firm Registration No.000459S
V K Muralidhar
Place: Hyderabad Partner
Date:30th May, 2017 Membership No. 201570


Desclouser of particulars with respect to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and out go as required under section 134(M) read with Companies (Accounts) Rules, 2014.

A. Conservation of Enegy

Conservation of energy continues to be accorded high priority. The Company conducts in-house study at regular intervals in respect of energy consumption and formulates operational systems to minimize power consumption.

B. Technology Absorption

The Company has not obtained any imported technoogy. The company has trained its personnel in the equipment suppliers works to absorb the technology.

C. Foreign Exchange Earnings and Outgo:

S.No. Current Year Previous Year
Rs. Rs.
1. Foreign Exchange earning - -
2. Foreign Exchange used for - -
Import of raw material


Particulars of contracts or arrangements with related parties referred to under section 188(1) of the panies Act,2013

S.No. Details of related Transactions Material terms and value Manner of determining the pricing and other Commercial terms of the contract
1. ICD & Advances received
Vayhan coffee Limited 55,00,000 -
Associate Company
2. ICD & Advances received
DCL Chemplast Limited 5,13,90,000 -
Associate Company
3. ICD & Advances receivied
DSL Finance & Gosthani 49,41,000 -
Associate Company
4. Unsecured Loans from 68,230,950 -
Directors & KMP