ISL Consulting Ltd Management Discussions.

INDUSTRY STRUCTURE AND DEVELOPMENTS

Indian capital market outperformed several major global markets, including the developed ones like the US and the UK as well as developing economies such as China and Brazil, with double-digit returns in the fiscal ended March 2019 despite numerous global and domestic headwinds. The Indian market benchmark indices also improved on their own performance in the previous fiscal, with the BSEs Sensex (17.3 per cent) giving relatively better returns than the NSEs Nifty (14.9 per cent) in 2018-19. With positive performance by benchmark indices and increasing fund raising from the market, the size of the capital market in India also continued to expand during 2018-19, with the market capitalisation rising by over 6 per cent to over Rs 151 lakh crore. Besides, mutual fund asset under management grew by 11.4% to nearly Rs 24 lakh crore and Foreign Portfolio Investors asset under custody expanded by 8.6% to close to Rs 30 lakh crore. This is despite the fact that 2018-19 was relatively a difficult and challenging year on account of global and domestic headwinds.

OPPORTUNITIES & THREATS/ RISKS & RESOURCES

Indias growth outlook for year 2019-20 will essentially have domestic drivers. The key drivers are expected to be private consumption and investment. With weak global environment, India will have to lean on domestic factors. With the government pursuing a fiscal consolidation path, the pickup in growth is expected to be only gradual.

Moreover, our strength lies in our strategic objective which is to build a sustainable organization that remains relevant to the agenda of our clients, while generating profitable growth for our investors.

RISK MANAGEMENT & INTERNAL CONTROL SYSTEMS

The company has been continuously evaluating its risk management systems to adjust to the continuous changes in the market scenario and the risk environment. It continues to enhance its capabilities in surveillance to make its risk management framework effective and efficient. The Company has a structure in place to identify and mitigate various risks that would be faced by it from time to time.

The company has an adequate system of internal controls to ensure accuracy of accounting records and compliance with all laws and rules/regulations. The Companys accounts have been periodically reviewed by the undersigned along with the senior management personnel and the Statutory Auditors. Its effectiveness is assessed regularly through procedures / processes set up by management, covering all critical and important areas. These controls are periodically updated and are subject to review by internal auditors. Post audit reviews carried out to ensure follow up on the observations made by auditors. The audit committee regularly reviews the observations made by auditors.

DISCUSSION OF FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

Directors of your Company are very hopeful to build up the performance of the company and post better results in the forth coming financial year and to add value to the shareholders. The Company is hopeful of improving its turnover and bottom line and hopeful of posting better revenue ahead. Financial Highlights with respect to Operational Performance is as under:

(Figures in Lakhs)
Particulars 2018-19 2017-18 2016-17
Total Income 4863.21 5684.08 4668.72
Profit before Tax -15.68 -62.28 41.15
Profit after Tax -15.59 -43.58 28.19
EPS -0.065 -0.36 0.23

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES

Our professionals and employees are our most valuable assets. We believe that the quality and level of service that they deliver is a huge contributing factor in growth of the Company. Mr. Savajibhai D. Galiya was appointed as Additional Director, Independent on the board of the company with effect from November 29, 2018. The employee strength as on March 31, 2019 was 7.

KEY FINANCIAL RATIOS

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018 the Company is required to give details of significant changes (change of 25% or more as compared to the immediately previous financial year) in key sector specific financial ratios, which are as follows:

(Figures in Lakhs)
Particulars 2018-19 2017-18
Inventory Turnover 25.33 11.38
Interest Coverage Ratio 0.72 -2.02
Current ratio 13.77 101.36
Change in return on Net Worth 0.01 0.04
Debt Equity Ratio 2.32 1.37
Operation profit margin ratio 0.82% -1.58%
Net profit margin ratio -0.32% -0.77%