hind commerce ltd Management discussions

The Textile Industry in India is second largest employer after agriculture providing jobs to the various class of peoples and is one of the significant contributors to the Indian economy. During the year 2021-22, the Cotton Textile Industry in India has experienced an improvement on account of overall demands from Overseas markets. Upward price trend in Raw Material and Textile products, has helped achieving better realizations for export. Overall Exports of Cotton Textiles increased from India.

However, demand dropped down in world market particularly from last month of the last quarter of the financial year 2021-22. Main reasons are too much volatility in Raw Material (raw cotton) prices, lesser demand of final products due to inflation all around, war in the West, Covid showing back strongly in China. Overall Exports of Cotton Textile products affected badly, reflecting much lower volumes and profits for the exporters.

Revival is only expected once Raw Material prices comes back to reasonable level, enable whole Textile value chain to move on smoothly.

Hind Commerce Limited is mainly engaged in the export trading of cotton yarn in all coarser and fine counts, where the Company has strong presence and leadership. The Company enjoys the excellent relationship with its overseas customers, which has been built over the years by strictly adhering to delivery schedules maintaining consistent quality and providing prompt after sales service.

Opportunities and Threats

The future of Indian Cotton Textile Industry is highly depending on availability of raw material at a competitive price. With the introduction of Hybrids and BT Cotton, the cotton production in India is increasing every year. The government is making efforts to supply proper quality seeds at a reasonable price to the growers and it is expected that the supply of quality cotton will be comfortable.

In the past, the Textile Industry did not develop in an organized manner and the policy favored fragmentation resulting in organized players suffering heavily

because of the distorted fiscal structure. Fortunately, in the last few years, the Government has now provided level playing field to all the sectors of textile industry and therefore, large investments are coming in the textile industry. Government had given good incentives under Technology Upgradation Fund Scheme and also benefits to the processing sector, which will give boost to the textile industry.

Outlook

The long term objective of the Company is to remain strong player in the cotton textiles export market. Goal is to add more Textile related value added products for Exports. To keep high quality Customer Service and development of new markets, focus is to use new Technology. Your Company is also continuously improving its operational efficiency, and cost control which will result in improvement of the bottom line in future.

As our Country is largest Cotton growing in the World, your Company is geared you to get advantages from offering various high quality Textile products for Exports and is hopeful to secure better market share in the Global markets.

A stable outlook on cotton and synthetic textiles would result from favorable policy environment, improvements in demand-supply position, continued stability in input costs and consequent improvement in margins/ liquidity. However, the good monsoon and pick up in Indian economy due to various measures taken by the Government would unleash demand in the long run and offset any slowdown in exports. Further, the hope of revival of Chinese economy will also bring the positive growth for this sector.

By enchasing the rich experience gained bythe Company in the Exports of Cotton Textile sector, the company has plans to increase its efforts of marketing and to open up Overseas Offices in order to better serve its customers.

Risks and Concern

> Our business shall dependent on the availability/supply and cost of raw materials which we source from domestic suppliers. Any significant increase in the prices of these raw materials or decrease in the availability of the raw materials, could adversely affect our results of operations.

> Our business is subject to regulation by several authorities, which could have an adverse effect on our business and our results of operations.

> We are heavily dependent on our Promoters and the loss of their guidance and services may adversely affect our business or results of operations.

> Change in Government of Indias Economic Liberalization policies may hinder prices of our equity shares

> Change in Tax laws in India (i.e. central tax, service tax and income tax) may increase tax liabilities of the company inversely affecting PAT

> Slowdown in the Indian economy may inverse effect in our profit

> Any Natural calamities, terrorist attack on India may hinder our profit

> Change in economic regulations and laws may also effect the company adversely

Internal Control Systems and their adequacy

The Company has a proper adequate internal control system to ensure that all the assets are safe guarded and protected against the loss from unauthorized used or disposition and that transactions are authorized, recorded and reported correctly.

The internal control is supplemented by an extensive internal audit, periodical review by the management and documented policies, guidelines and procedures. The internal control is designed to ensure that the financial and other records are reliable for preparing financial statements and other data and for maintaining accountability of assets.

Financial and Operational Performance

During the year under review your Company has reported a total income of Rs. 13924.12 Thousands when compared to previous years proceeds of Rs. 35045.98 Thousands.

Liquidity and Capital Resources

Particulars	2021-2022 (Rs. in Thousand)	2020-2021 ( Rs. in Thousand)
Cash and Cash Equivalents -
Beginning of the year	0.08	0.08
End of the year	0.08	0.08
Net Cash provided (used) by -
Operating activities	8396.31	48100.52
Investment activities	-4370.77	-51364.19
Financial activities		-

The net cash outflow in the operating activities during the year under review has been Rs.8396.31 Thousands Lakhs as compared to cash outflow of Rs. 48100.52 Thousand in previous year. Further, there is cash inflow in investment activity of Rs.-4370.77 Thousands Lakhs as compared to inflow of Rs. -51364.19 Thousands in previous year. The Cash flow from financial activities is Nil for the year under review.

Material Developments in Human Resources

The Company continues to lay emphasis on developing and facilitating optimum human performance. Performance management was the key word for the Company this year. Recruitment process has been strengthened to ensure higher competence levels.

There were 3 (three) permanent employees on the rolls of the Company as on March 31, 2022.

	For and on behalf of the Board
	Sd/-	Sd/-
	Umesh Lahoti	Ujwal Lahoti
	Managing Director	Director
Place: Mumbai	(DIN: 00361216)	(DIN: 00360785)
Date: 12th August, 2022