Dolfin Rubbers Ltd Management Discussions.

The Management discussion and Analysis Report, is a reflection of the current state of business of the company. It also deals

with opportunities and challenges faced by Company and future outlook.

ECONOMIC AND INDUSTRY OVERVIEW INDIAN ECONOMY

India has emerged as the fastest growing major economy in the world as per the Central Statistics Organization (CSO) and International Monetary Fund(IMF) and it is expected to be one of the top three Economic Powers of the World over the next 10-15 years, backed by its strong democracy and partnerships. Indias GDP for the F/Y 2018-19 is 6.8% and is expected to grow 7% + in 2019-20. In PPP terms, the economy is expected to be among the top five global economies by 2020.

INDUSTRY STRUCTURE

The Indian auto Industry is one of the largest in the World. The Industry accounts for 7.1 per cent of the Countrys Gross Domestic Product (GDP). The two wheelers segment with 80 percent market share is the leader of the Indian Automobile Market owing to a growing middle class and young population. Moreover, the growing interest of the automobile companies is exploring the rural market further aid the growth of the sector. The overall Passenger Vehicle (PV) has 14 percent market share. As the production of passenger vehicles, commercial vehicles, two and three wheelers grew at 14.41 percent year-on-year and is set to witness major changes in the form of electric vehicles, shared mobility etc. Some of the factor attributable to this include: a buoyant end-user market, improved consumer sentiment and return of adequate liquidity in the financial system.

OUTLOOK FOR THE FINANCIAL YEAR 2019-20

We look forward to maintain our present growth level and working on factors which will lead to increase in pace of our growth. As the demand for passenger vehicles, commercial vehicles, two and three wheelers is rising on a constant pace each year and constitute 30-40% of total tyre demand (in value terms) in original equipment demand. We can foreseen that this rise in demand will lead to rise in demand of tyres and tubes also. So in order to grab opportunity of the rising market we are engaged in upgrading/adding our machinery which can be helpful in the production of tyres also, so that the exploration of this new segment can help the company to rise further in coming future.

FINANCIAL ANALYSIS AND REVIEW OF OPERATIONS (ON STANDALONE BASIS):

Financial Analysis

Revenue Break – up:

Particulars 2018-19 % to Total Income 2017-18 % to Total Income
Revenue 7009.186 99.72 5386.61 99.72
Other Income 19.55 0.28 15.26 0.28
Total Turnover 7028.736 100 5401.87 100

The net turnover of the Company has increased substantially to INR 7009.186 lakh in the year 2018-19 as against INR 5386.61 lakh in the previous year.

(INR. in lakh)

Particulars 2018-19 % of Turnover 2017-18 % of Turnover
Profit /Losses before
351.78 5.02 236.65 4.39
Depreciation and tax
Depreciation 62.56 0.89 5.71 1.06
Profit /Losses before Tax 289.22 4.13 179.85 3.34
Tax (Previous Year) 102.53 1.46 48.43 0.90
Profit/ Losses after Tax 186.69 2.66 131.41 2.44

RESOURCE UTILIZATION Fixed Assets

The gross fixed assets as at 31 March, 2019 are INR 145.82 lakh as compared to INR 120.92 lakh in the previous year.

The net fixed assets (including work - in - progress & capital advances) as on 31 March, 2019 are INR 109.57 lakh as compared to INR 90.24 lakh in the previous year.

Current Assets

Sundry debtors (Net of Provision) of the Company are INR 928.43 lakh in the year 2018-19 as against INR 790.23 lakh in the previous year. Inventory level is at INR 304.48 lakh in the year 2018-19 as against INR 153.84 lakh in the previous year. Cash and cash equivalents is at INR 1.68 lakh in the year 2018-19 to INR 0.58 lakh in the year 2017-18. Short Term Loans & Advances is at INR 4.52 lakh in the year 2018-19 to INR 4.57 lakh in the year 2017-18. Other Current assets is at INR 1.22 lakh in the year 2018-19 to INR 0.77 lakh in the year 2017-18

Risk and Concerns

The major part of raw material for tubes is polymer, which is mainly imported from Japan, Russia and Singapore. Due to this dependability upon import of raw material, company has to face a major threat relating to fluctuation in currency.

Also as the company is majorly depending upon the human resource for its day to day working, therefore high labour turnover rate may affect the company.

Opportunities and Threats

Opportunities remain immense as India is one of the highest growing economy, at just below than $3trillion economy. With rise in demand in OE and replacement segment, new opportunities awaits for the company.

Also as the demand for tube is directly interrelated with automobiles industry, therefore rise or fall in vehicles sector imposes

a major threat to our company.

Adequacy of Internal Control Systems

The Company have a adequate Internal Control Systems in process which ensures that all the transactions are satisfactorily recorded and reported and all assets are protected against loss from an unauthorized use or otherwise. The Internal control system is adequate and commensurate with the nature of its business and size of its operations, though continues efforts are being made to strengthening the same. The management also reviews the internal control systems and procedures to ensure its application.

Material Development in terms of Human Resources

The Human resource is considered to be the main part of the development of Industry and continuous efforts have been made

to enhance the quality of human resource by providing adequate skills and training.

Cautionary Statement

Statements made on Management Discussion & Analysis, describing the Companys expectations or predictions are "forward-looking statements". These statements are based on certain assumptions and expectation of future events. The actual results may differ from those expected or predicted. Prime factors that may make a difference to the companys performance include market conditions, input cost, Government policies/regulations, economic conditions, and other incidental factors.