Ishita Drugs & Industries Ltd Management Discussions.

GENERAL INFORMATION ABOUT THE COMPANY

The company is engaged in the business of manufacturing of various APIs (Active Pharma Ingredients) and drug intermediates. It has built up a reputation as a manufacturer of "high quality" products and is known for its ethical dealings in business. The company supplies its products to leading pharmaceutical companies of India. The products are also being exported to various countries across the world.

NATURE OFTHE INDUSTRY

The Indian API industry has been facing a challenging business environment for last few years. With opening up of the Indian markets and signing of the WTO arrangement, the imported APIs and Intermediates became available at a very competitive price. This impacted the indigenous API and Intermediates manufacturers, who could not compete with the imported pricing. The Indian API industry has also been affected by stringent pollution control norms. Presently, almost 60-70% of total APIs consumed in India are imported. Over a period of time, the manufacturing capabilities & capacities for APIs in India has gone down. However, due to the COVID-19 pandemic, the present Govt. has recognized the importance of reducing dependence on China for APIs and has affirmed its commitment to encourage domestic API industry by introducing special measures for its development.

OPPORTUNITY ANDTHREAT:

The biggest threat for the API industry is from imports. Further, due to the ongoing uncertainity in the aftermath of the COVID-19 pandemic, the industry faces other operational risks due to manpower shortage, logistics problems, raw material availability, subdued demand etc. Other threats include requirement of resources for continuous up gradation of the facility as per the GMP standards. This is especially more important for small scale industries like your Company.

The Company has taken advantage of relaxations granted by the Govt. for Environmental Clearances during the COVID-19 pandemic and had applied for an Environmental Clearance (EC) to the appropriate authority. As and when it is approved, the Company can take further steps to increase the product portfolio of the Company, which will help improve capacity utilization and add to the top line. The company has also obtained GMP Certification in October 2021, which will help increase exports to the unregulated and semi-regulated markets. Your company, with its built up reserves and debt free status, is in a good position to take advantage of any other such measures declared by the Govt.

FUTURE OUTLOOK:

The managements opinion on the future outlook for the Company is given under the Directors Report forming part of the Annual Report of the company.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The Company has adequate and effective internal controls to provide reasonable assurance on achievement of its operational, compliance and reporting objectives.

The Company has deployed controls through its policies and procedures. It helps the Management to accomplish its objectives by bringing a systematic and disciplined approach to improve the effectiveness of risk management towards good corporate governance. The Directors handle most of the day to day functions. The Directors are regularly looking after all the key areas of the operations.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

The managements view on the business operations and financial performance of the company, including export performance and earnings, is given under the Directors Report forming part of the Annual Report of the company.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED:

The Companys operations are managed by technically and educationally qualified staff at all levels, who in turn are guided and supervised by the Directors of the Company. During the year under review, the company has increased the number of employees to better look after the various operations and to prepare for a better growth in the future.

CAUTIONARY STATEMENT:

Statement in the Management Discussion and Analysis, describing the Companys objective, projections and estimates are forward looking statements and progressive within the meaning of applicable security Laws and Regulations. Actual results may vary from those expressed or implied, depending upon economic conditions, Government Policies and other incidental factors.