Growington Ventures India Ltd Management Discussions

<dhhead> MANAGEMENT DISCUSSION AND ANALYSIS REPORT </dhhead>

1 . Economic overview

1. 1 Global

Global economic growth slowed down to 3.4% in 2022 as per International Monetary Fund (World Economic Outlook Apr 2023) compared to 6.2% in 2021. A gradual recovery posts the pandemic was beginning to take shape with unwinding of supply chain disruptions, however, the Russia-Ukraine conflict resulted in inflationary pressure and slowed the pace of recovery.

1.2 India Foreign Trade policy 2023

In a departure from tradition, India’s Foreign Trade Policy (FTP) 2023 will not have a five-year target date. The policy will instead be long-term and dynamic, as the government will make amendments as necessary.

The goal is to reach US$2 trillion exports by 2030 by shifting from an incentive to remission and entitlement-based regime.

India is expected to end the fiscal year 2022-23 with a total of US$760-770 billion worth exports, an improvement over the FY 2022 figure of US$676 billion. This was achieved despite various global headwinds that have disrupted supply chains,slowed export demand, and put pressure on trade shipments. (Source: Ministry of trade and commerce)

1.2 India

The agriculture sector is the largest source of livelihood in India. The country is one of the largest producers of agriculture and food products in the world. In 2022-23, India’s agriculture sector growth rate was estimated to be at 3.5% and it was 3.0% in 2021-22. The country produces many crops and food grains such as rice, wheat, pulses, oilseeds, coffee, jute, sugarcane, tea, tobacco, groundnuts, dairy products, fruits, etc.

The largest importers of India’s agricultural products are Bangladesh, UAE, USA, Vietnam, Saudi Arabia, Nepal, Malaysia, and Indonesia. The other importing countries are Iran, Egypt, Iraq, and China. During 2021-22, Bangladesh was the largest importer of Indian agricultural products at US$ 2.83 billion with a share of 11.46% of the total exports. Bangladesh is the major importer of Agri & allied products at US$ 3.8 billion followed by UAE at US$ 2.3 billion. USA and China are major importers of India’s marine products.

1.3 Total Import

India imports Edible Fruit and Nuts; Peel or Citrus Fruit or Melons. Amounting to Rs. 3,459,826.02I(In lakhs) approx. constitutes i.e., 0.6034 percent of total imports of the country.

(Source: Ministry of trade and commerce)

1.3 Outlook

According to the International Monetary Fund, Indian economy is projected to deliver robust growth of 5.9% for 2023, highest amongst the emerging economies, driven by strong domestic demand and healthy consumption growth supported by an improvement in labor market conditions, increasing consumer confidence, an expected recovery in rural demand and higher purchasing power with moderating of inflation. In the Union Budget for FY2023-24, the government announced a 33% increase in capex allocation to INR 10 trillion, which is expected to boost private investments. The Budget has also targeted a lower fiscal deficit in FY2023-24 at 5.9% and the government has committed to bring it down to below 4.5% by FY 2025-26.

2. Description of our Business and Operations

Growington Ventures India Limited (Previously known as VMV Holidays Ltd.) marked the completion of 12 years since the date of its incorporation i.e August 03,2010, under Companies Act, 1956 having its registered office in Navi Mumbai, State of Maharashtra. During the year the Company has diversified its main business activities towards trading in import and exports of fruits and we focused to expand the base of agro-products to spices etc. This will give us more verticals to service our valued clients and improve market hold. We will provide these products on worldwide basis and aim to emerge as a global import -export trader. We focused on covering the maximum possible locations by expanding our network of our own Office and agents.

We get associated with agents by entering into agency agreements with fix terms to have limited cost and better revenue for handling our import and export operations at India, Indian Sub-continent, South Africa, Turkey, Gulf, Upper Gulf, South East Asia like Vietnam and Thailand and Far East etc. so that we have worldwide coverage in cost effective manner. The Company constantly make an effort to add more value to our products and services, thereby providing ultimate customer satisfaction.

The brief road map for activities undertaken by the company is illustrated below:

? Identification of suppliers in with capacity to supply large volume of generic products at competitive prices.

? Negotiating the terms of sale and delivery of products. ? Financing and assurance of payment to the supplier. ? Managing logistics and transport. ? Distribution and sale of the products through its network.

As the economy, consumer and channel landscapes rapidly evolve, we continue to be agile to leverage our strengths, capture opportunities and navigate through the challenges. Our strategy is constantly evolving in line with the trends and forces shaping our markets and impacting our multi-stakeholders. We remain committed to delivering growth.

3. Opportunities and Threats

The Company bears the normal risk in terms of inherent business risk in the kind of business the company is into. The Board of the company has taken a balanced approach for investing in these activities and evaluating the potential as well as the risk to return on capital.

4. Industry & Business Outlook

A gradual recovery posts the pandemic was beginning to take shape with unwinding of supply chain disruptions, however, the Russia-Ukraine conflict resulted in inflationary pressure and slowed the pace of recovery. Your Management is evaluating various business opportunities and evaluating the potential as well as the risk to return on capital. In the backdrop of a challenging operating environment in this fiscal, we dynamically managed our business to deliver strong bottom-line performance and made significant progress on our strategic priorities. We will continue to take approach in financial year 2022-23 where operating environment is expected to remain challenging with further input cost inflation and market growth.

 Our strategic clarity, the strength of ourbrands, our execution prowess, agility and adaptability will continue to hold us in good stead.

5. Risks and Concern

Company has a Risk Management Committee to look after the risk related matters of the Company. Risk Committee meetings are held to address the risk issues relating to various businesses and support areas and monitor critical risk factors in order to effectively address them. Risk Management limits on foreign exchange exposure and credit limits for counter parties are set and reviewed periodically. Your Company considers reviewing current practices on risk management initiativesto strengthen the risk management frame work.

6. Internal Control System and their Adequacy

Internal Control Systems are embedded in all processes across all functions in your Company. These systems are being reviewed regularly and whenever necessary, they are modified or redesigned to ensure better efficiency, effectiveness and improved controls. The application systems for individual businesses are backed by an integrated Accounting System. These integrated systems form part of the overall control environment. Process and systems are subject to Internal Audit through an annual internal audit plan. These are further supported by the Statutory Auditors who validate that the financial reporting is true and fair. The results of all audits are discussed with the Senior Management and reviewed by the Audit Committee. The Audit Committee meetings are held every quarter.

7. FINANCIAL PERFORMANCE

Our revenue increased billed by higher volumes and higher pricing. The EBITDA increased during the year by 40.08 times. PBT for the year was increased by 48.12 times from a year ago, on account of higher profitability.

FINANCIAL RATIOS:

8. HUMAN RESOURCES

The strength of any Company lies in the competencies and skill of its employees. Human Resources in Company strive to enable the organization to achieve its objectives by constantly focusing the business needs. This creates a need for constantly evolving and stimulating the systems and processes in the context of organizational culture. These are challenging times, and to retain a competitive edge, a company must direct individual accomplishment toward organizational objectives. The Company has a healthy mix of senior and junior team members which creates a good skilled and trained work force working towards success of the Company. Peaceful and cordial relations continue with the employees. The Company strives to promote an open culture and provide a vibrant work environment to its employees. For constant skill and knowledge up gradation the Company imparts training to all the employees based on individual needs and also encourages them to attend external seminar and workshops.

9. INFORMATION TECHNOLOGY

Our company constantly upgrades its technology both in terms of hardware and software. In requirement of SEBI Circular SEBI/CIR/CFD/DCR1/CIR/P/2020/181 dated September 23, 2020 the company has invested in implementing SDD software system as required under SEBI (SAST) Regulations, 2011. Moreover, we have invested in installing a good management information system for the management to get timely information for decision making.

10. CAUTIONARY STATEMENT

Statement in Management Discussion & Analysis describing the Company’s objectives, projections, estimates, expectations may be “forwarded 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 difference to the Company’s operation includes economic conditions affecting the demand and/or price conditions in the domestic and overseas markets in which the Company operates,changes in Government regulations, tax laws and other states and other incidental factors.