gcv services ltd share price Management discussions

GCV Services Limited (FORMERLY GUJARAT CAPITAL VENTURES LIMITED) ANNUAL REPORT 2010-2011 MANAGEMENT DISCUSSION AND ANALYSIS (Rs. in Lacs) Year Ended Year Ended Financial Results 31.03.2011 31.03.2010 Income 51.13 10.62 Profit before Tax 31.00 (0.50) Less: Provision for Taxation 9.56 - Profit after Tax 21.44 (0.50) Add : Profit brought forward from Previous Year (12.94) (12.44) Balance carried forward 8.50 (12.94) DIVIDEND Due to inadequate profits in the current year and accumulated losses, the Board has not recommended any dividend for the Financial Year 2010-2011. OVERVIEW BUSINESS The Company ventured into the service industry of Hotel Management, Hospitality & Housekeeping. The Management is optimistic that the new business will prove to be fruitful for the Company. CHANGE IN NAME OF THE COMPANY In order to reflect the new business of the Company, the name of your Company was changed from Gujarat Capital Venture Limited to GCV Services Limited. PERFORMANCE & CURRENT YEAR PROSPECTS Change in Name and Objects of the Company: As the Company was incurring losses, your Management decided to revive the Company by diversifying into Hotel Management, Hospitality and Housekeeping Industry. The Members of the Company on October 12, 2010 approved the new business of the Company and your Company moved into Housekeeping and Hospitality segment. To reflect the new business of the Company, the name of the Company was also changed to GCV Services Limited w.e.f. October 30, 2010. RISK & CONCERNS Risk is inherent part of the Companys business. Effective Risk Management is critical to any industry. In view of this, aligning Risk Management to Companys organizational structure and business strategy has become integral to the business of the company. The Companys goal in risk management is to understand, measure and monitor the various risks that arise, and to evolve appropriate policies and procedures to mitigate these risks. As your Company has entered into a new market segment, it runs the risk of facing stiff competition from established players in the market. Also, Hotel Management and Hospitality being a labour intensive industry, hiring and retaining skilled manpower is a challenge in itself. The Company manages and reviews the risk management system, policy and strategy from time to time. The Board identifies, assesses and monitors all principal risks. The ever changing business environment necessitates continuous monitoring, evaluation & management of significant risks faced by the organization. Your Company periodically reviews the risk assessment and minimization procedures and steps taken by it to mitigate these risks. INTERNAL CONTROL SYSTEMS AND ADEQUACY In the opinion of the management, the internal control systems are adequate and provide, among other things, reasonable assurance of recording transactions of operations in all material respects and of providing protection against significant misuse or loss of Company assets. Employees conduct internal audits to assess the adequacy of the internal control procedures and processes of the Company. The accounts of the Company are reviewed by the Audit Committee of the Board. Policy and process corrections are undertaken based on input from these auditors. MATERIAL DEVELOPMENT IN HUMAN RESOURCES The relation of the Company with its employees continued to be harmonious during the year under review. Sustained success for an organization presupposes an unwavering concentration on leadership development and strengthening the talent pipeline at all levels. Learning and development initiatives are directed towards enhancing the effectiveness of employees and we believe in building human capabilities by exposing our people to a wide variety of business complexities and providing them with greater empowerment and responsibility at all levels. Our philosophy was redefined towards making it more performance oriented and business driven, at the same time, acknowledging an employees commitment to growth. We believe that a culture of appreciating all big and small achievements is crucial to develop a motivated, contributing workforce. SUBSIDIARY Though the Company was not having any subsidiary in the year under review, the Company has incorporated a Wholly Owned Subsidiary in the name and style of GCV Services FZE, in Hamriyah Free Trade Zone, UAE in the current year.