Govind Poy Oxygen Ltd Management Discussions.

The Board of Directors is pleased to present the Management Discussion and Analysis Report based on the current Government Policies and the Market Conditions.

Industry structure anddevelopments

The Company is categorized as a Small Company as per the MSME Act, 2006 and operates in States in and around the State of Goa for the supply and manufacture of Industrial & Medical Gases. There has been no significant change or effect of the industry or any developments in the industry on the operations of the Company within the previous financial year, however the Company hopes to maintain an optimistic outlook toward the future.

Segment wise or Product-wiseperformance

The Company operates in only one segment, i.e. the manufacture of Industrial & Medical Gases, and the primary products manufactured by the Company are Medical Oxygen and Industrial Gases such as Oxygen, Nitrogen, Dissolved Acetylene & Argon. The performance of the Company in this segment has been found to be satisfactory.

Opportunities

The Companys plant situated at Arlem, Salcete, Goa is equipped with latest technology and offers high quality products. The plant has all infrastructure facilities and is well connected with State highway. The Company manufactures (a) Industrial gases viz. Oxygen, Nitrogen, Dissolved Acetylene and Argon and its related grades and (b) Medical Oxygen. The Company caters to various industries and hospitals in entire Goa and neighboring states of Maharashtra and Karnataka.

In order to provide better service to its customers, Company also has depot at Kolhapur that caters to our customers in Maharashtra.

Risks andconcerns

The Company faces risks in the market due to competitive prices and increase in competition from other entities in its market segment. Although the Company has put in its best efforts to combat such risks this still remains a major concern for the Company. The Company also faces risks which are common in the industry like high costs for transportation, safety in the production process and transportation of products and timely recovery of dues from its customers.

Outlook

The Company has an optimistic outlook for the future performance of the company due to increasing government incentives for the industry and SMEs in particular. The Company aspires to provide quality products at fair prices to have a steady and sustainable rate of growth over the years.

Internal control systems and theiradequacy

The Companys internal control system over its operation has found to be adequate for the scale and size of its operations. The management, in consultation with the audit committee of its board of directors regularly reviews the adequacy and effectiveness of the internal control systems and undertakes improvements wherevernecessary.

Discussion on financial performance with respect to operationalperformance

The operational revenue of the company during the year was of Rs. 815.38 lakhs, which is higher in comparison to the previous year. Despite the increase in turnover and operational profits, the company has incurred a loss due to decrease in margin and increase in other administrative expenses.

The Operational Highlights of the Company are given below, it is recommended that the same is read with the Financial Statements, the schedules and the notes thereto.

Particulars F.Y. F.Y.
2018-19 2017-18
Revenue from Operations 8,15,37,909 7,29,28,965
Less: Operational Expenses (5,48,59,891) (4,62,49,755)
Gross Profit (in Rs.) 2,66,78,018 2,66,79,210
Gross Profit Margin (%) 32.72% 36.58%

Material developments in Human Resources / Industrial Relations front, including number of peopleemployed

The Companys relations with its employees across all the Companys units were cordial during the year under review, and the company employed 3 (Three) persons during the financial year.

Safety, Health and Environment

The Company gives utmost importance to safety, health and environment related issues. The employees are continuously educated and trained to improve their awareness and skills. All safety statutory requirements are being complied with. Requirements of environmental acts and regulations are also complied with.