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The Management of Gravity (India) Limited, is pleased to present its report analyzing the Companys operations in the textile industry segment. The report contains expectations of the Companys business based on the current market environment.
The Company was promoted in the year 1988. The Companys principle business comprises of manufacturing and marketing of various textile products. The year under review witnessed turnaround of the Indian Textile Industry. The Board considers overall performance reasonably satisfactory and indicative of the future growth of the Company.
TEXTILES BUSINESS INDUSTRY PERSPECTIVE
Textile is the largest industrial sector in India, generating a turnover approximately about 1% of GDP. It is the largest employer in manufacturing sector. The Board foresees the huge demand and vast potentiality in the near future.
OPPORTUNITIES & THREATS:
Ambition of the Government of India, to make India a hub for technical textiles will create an opportunity for the industrial fabric division of your Company to function better as compared to earlier years. Performance of the fabric will see a reasonable growth which will benefit the industry in moving up the value chain.
Severe power shortage in most of the states will remain a biggest threat for the utilization of the plant and equipments. Due to shortage of power, the utilization may drop severely and hence volatility in yarn prices may continue. Even though the industry expects the cotton prices to best able, the whole scenario may change, in case China decides to increase their cotton reserves. Hence, it is expected that cotton prices too may have volatility.
Due to severe recessionary trends which are continuing in the developed countries, unit realization of products may continue to be under pressure.
SEGMENT-WISE / PRODUCT-WISE PERFORMANCE:
The business segment of the Company is Textiles. Segment wise performance together with discussion on financial performance with reference to operational performance has been in the Directors Report, which should be treated as forming part of this Management Discussions and Analysis.
The future of the textile industry as a whole looks bright. Textile Units with low financial costs and labour costs with modern Machinery will do well. Economy of size and location of the unit will also play a great role in the success of the unit.
RISK AND CONCERNS
Being an agro-based industry the production of raw material varies from year to year depending on weather conditions, customer demand, price fluctuation etc.
Also the textile industry being a highly fragmented industry leading to high competition and low profit margins is a matter of concern.
Changing export dynamics is also a matter of concern.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
Your Company has the benefit of internal control systems which has developed over the years and which has ensured that all transactions are satisfactorily recorded and reported and all assets are protected against loss from unauthorized use or otherwise. The process of internal control and systems, statutory compliance, risk analysis and its management and information technology are woven together to provide a meaningful support to the management process. The system adopted, especially relating to internal control systems are adequate and commensurate with the nature of its business and size of its operations, though continuous efforts are being made to strengthening the same.
DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE
The Company has achieved a turnover of Rs. 1,197.83 Lacs during the year. The turnover was reduced mainly due to lack of textile Industry and increase raw material prices. The Company has undertaken relevant steps to improve its operational efficiency and generate greater revenues. The company has earned profit of Rs. 102.00 Lacs during financial year 2018 -2019.
HUMAN RESOURCES DEVELOPMENT AND INDUSTRIAL RELATIONS:
Over the last few years, your Company has brought with it the need for skills and knowledge to successfully meet the requirements of different charters. Also, with the added emphasis placed on the safe operation. The training given not only covers knowledge and technical skills but also lays stress on behavioral areas, like creating a safety mindset, and attitude building. The Company also seeks the views of its employees for improving human relations through employee satisfaction surveys. The Company continues to have cordial relations with the employees. It recognizes the potential and performance of its employees, provides challenges and opportunities. It endeavors to upgrade knowledge, attitude and skill of the employees. The labour welfare activities are organized by the Company as an ongoing process. The Company has manpower strength of approximately 100employees.
DISCLOSURE OF ACCOUNTING TREATMENT:
During the year under review the Company has been adopted prescribed Accounting Standards issued by the Institute f Chartered Accountants of India as applicable to the Company in the preparation of Financial Statements.
Statements in the Management Discussion and Analysis describing the Companys objectives and expectations may be forward-looking statement within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include economic conditions affecting demand/supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the Government regulations, tax laws and other statutes and other incidental factors.
Your Companys primary focus will be to grow volumes across markets. Gravity (India) will address each market depending on local conditions and consumer trends. While were cognize that the global environment is extremely challenging there are new opportunities merging to meet consumer needs. Gravity India will focus on profit able growth through a mix of brand led growth, innovation, efficient cost management and successfully scaling up new businesses.
|For and on behalf of the Board of Directors|
|Place: Mumbai||Chairman and Managing Director|
|Date: 13 August, 2019||DIN:00894145|