Dynamic Industri Management Discussions


INDUSTRIAL STRUCTURE AND DEVELOPMENT:

The Company is in the business of manufacturing of Chemical and Dye and Dye Stuffs. Your Company is key producer of Synthetic Organic Dyes, Acid Dyes, Direct Dyes and Solvent Dyes based in India having its Plants Situated at Gujarat Industrial Development Corporation (GIDC), Vatva, Ahmedabad, India. The Products find their application in various industry segments such as Textiles, leather, cosmetic, paper printing, plastics to shade their products etc. The plant facility is equipped with up to date manufacturing equipment and supported by R & D Center and quality assurance department which are equipped with advanced equipment and analytical instruments. The Company has an excellent team of experienced and qualified professional to manage day to day operations efficiently. For more details, please visit www.dynaind.com.

OVERVIEW:

The financial statements have been prepared in compliance with the Indian Accounting Standards (Ind AS) issued by The Institute of Chartered Accountants of India (ICAI) which have been notified under the Companies (Indian Accounting Standards) Rules, 2015 (Ind AS Rules), of the Companies Act, 2013 The management of the company accepts responsibility for the integrity and objectivity of these financial statements, as well as for various estimates and judgments used therein. The estimates and judgments relating to the financial statements have been made on a prudent and reasonable basis, in order that the financial statements reflect in a true and fair manner the form and substance of transactions, and reasonably present the companys state of affairs and profit for the year.

OPPORTUNITY:

India is one of the largest exporters of Dyes & Intermediates across the global. Indias capability in low cost manufacturing, availability of technically trained manpower, better price realization globally and strong presence in market are the key growth drivers. Your company is key manufacturer of Dye and Dye stuffs in India which is a growth market. This offers regular opportunities & helps company to cater to market needs very effectively. Over the years, the company has developed robust Systems which help to maintain and sustain the operations despite sever challenges it faces and able to enjoy the market leadership position. Its geographical position & the vicinity to customers also offer added advantage in servicing the customers.

THREATS:

1. Changes in the tax laws, Government policies, and regulatory requirement might affect the companys business.

2. The cost of electricity for Chemical Industry has been ongoing bone of contention for decades, and at times of high oil prices, the cost of feedstocks can put the industry at a huge disadvantages.

3. Compliance issues with the environmental norms and regulations COMPETITION:

Competition in the domestic as well as international market has intensified and forced the players to adopt aggressive marketing strategy and promotional campaigns to capture and protect their market shares. The Company has the plans to penetrate better intoglobal market, especially

through the customer retention and business development in the regions which have not been tapped.

The Company sells its products through a well-established network in different countries, which are supported by the Companys strong marketing force. The Company has developed a well- defined Trade Relationship Management Policy. The Companys broad product range and frequent visits by its marketing people to the outlets and the importing countries ensure that the Companys products receive a maximum response and are adequately promoted.

SEGMENT WISE AND PRODUCT WISE PERFORMANCE:

The Company operates within a solitary business segment i.e. manufacturing of chemicals and dyes. Further, all products of the company are classified as "Dyes". Hence, Segment/Product wise report is not given separately.

RISK AND CONCERN:

The risk management function is integral to the company and its objectives include ensuring that critical risk is identified continuously, monitored and managed effectively in order to protect the companys business.

However, the changes in the tax laws, Government policies, and regulatory requirement might affect the companys business. Uncontrolled variation in the price of input materials could impact the companys profitability to the extent that the same are not absorbed by the market through a price increase and/or could have a negative impact on the demand in the market. Currency risks mainly arise out of overseas operations. Exchange rate fluctuation could significantly impact earnings because of earning in foreign currencies and expenditures in foreign currencies. The company is operating in the highly competitive market.

The management has already taken initiatives in advance for mitigating the above mentioned risk and concerns/challenges. The company has taken major initiatives like a hedging of exposure in foreign currencies, strong marketing efforts, focus on cost reduction through inventory management techniques, the introduction of new products and manufacturing process without compromising the quality of products and retain talented employees etc.

INITIATIVES BY THE COMPANY:

The Company has taken the following initiatives:

• Concentration on the reduction of costs by undertaking a specific exercise in different fields.

• Concentration in Increase of Exports.

• Focusing on the modernization of manufacturing process to improvise quality and reduction of costs.

• The Company is quite confident that the overall productivity, profitability would improve in a sustainable manner, as a result of this strategy.

The company has demolished the old Plant and Machineries and install new Plant and Machineries with latest technologies to improve the quality of product and avoid any uncertainty at Companies Unit.

OUTLOOK:

For the year 2023-24, the Companys focus will continue to be stable, as the Company continues to work on distribution expansion and strengthening of supply chain. The Company is confident to meet the challenges with its strength in marketing network, its strategic planning, Research & Development productivity improvement and cost reduction exercise.This will be achieved by forging stronger relationship with customers and by negotiating and entering in to beneficial contracts with the suppliers of raw materials.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has a proper and adequate system of internal controls to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposal. The internal control systems are supplemented by an extensive program of internal audits, review by management guidelines & procedures. Companys control systems are time tested, documented and recognized under ISO Certification. On the financial side, periodic audits by Internal Auditors and External Auditors provide a means whereby identification of areas of improvement and corrective measures taken whenever applicable. The Company has an independent internal audit system, covering on a continuous basis, the entire gamut of operations and services spanning major business functions. The internal audit functions include evaluation of all financial & major operating system controls. The internal audit findings and recommendations are reviewed by the Audit Committee and are then reported to the Board.

HUMAN RESOURCE:

Your Company firmly believes that employees are the most valuable assets and key players of business success and sustained growth. Various employee benefits, recreational and team building efforts are made to enhance employee skills, motivation as also to foster team spirit. Industrial relations were cordial throughout the year. The Company has 76 employees excluding Directors & KMP as on year ended 31stMarch, 2023.

WHISTLE BLOWER POLICY :

The Company has a Whistle Blower policy in place to deal with instances of fraud and mismanagement, if any. The details of the policy are explained in the Corporate Governance Report and the said whistle blower policy is posted on the website of the Company.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

In terms of performance, FY 2022-2023 has been a moderately good year. Company is focused on the task on hand in terms of better reliability of operations and more focussed market efforts. Our financial performance reflected the steady operational performance. Our revenue from continuing operations declined by 15.14% to Rs.4563.10 Lakhs. EBIDTA was Rs.155.77 Lakhs and Profit for the period was Rs.114.06 Lakhs. Cash and cash equivalents at the end of the year stood at Rs.87.67 lakhs.

DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED EXPLANATIONS THEREFOR:

Sr. no. Particulars 2022-23 2021-22
1 Debtors Turnover Ratio 3.75 4.10
2 Inventory Turnover Ratio 3.36 3.66
3 Interest coverage ratio 17.78 13.05
4 Current Ratio 2.75 2.43
5 Debt Equity Ratio 0.05 0.08
6 Operating Profit Margin 0.04 0.04
7 Net Profit Margin 2.51 2.64
8 Return on Net worth 2.43 3.08
9 P/E Ratio 16.46 14.99

DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF:

The Company has earned reasonably better during the year as compared to previous year, hence your company has earned significant sum as return on Net Worth.

DISCLOSURE OF ACCOUNTING TREATMENT :

The Financial statements have been prepared in compliance with the Indian Accounting Standards (Ind AS) issued by The Institute of Chartered Accountants of India (ICAI) which have been notified under the Companies (Indian Accounting Standards) Rules, 2015 (Ind AS Rules), of the Companies Act, 2013. The financial statements have been prepared on accrual basis under the historical cost convention.

CAUTIONARY STATEMENT

The statements in the "Management Discussion and Analysis Report" section describes the Companys objectives, projections, estimates, expectations and predictions, which may be "forward looking statements" within the meaning of the applicable laws and regulations. The annual results can differ materially from those expressed or implied, depending upon the economic and climatic conditions, Government policies and other incidental factors.

Date : 14th August , 2023 By Order of the Board of Directors

Placa: Ahmedabad

Sd/-

Harin Mamlatdarna Chairman & Wholetime Director DIN:00536250