Jai Corp Ltd Management Discussions

This report contains forward-looking statements, which may be identified by their use of words like Rs.plans Rs., Rs.expects Rs., Rs.will Rs., Rs.anticipates Rs., Rs.believes, Rs.intends Rs., Rs.projects Rs., Rs.estimates Rs. or other words of similar meaning. All statements that address expectations or projections about the future, including but not limited to statements about the company Rs.s strategy for growth, product development, market position, expenditures and financial results are forward- looking statements. Forward-looking statements are based on certain assumptions and expectations of future events. The company cannot guarantee that these assumptions and expectations are accurate or will be realised. The company Rs.s actual results, performance or achievements could, thus, differ materially from those projected in any such forward- looking statements. The company assumes no responsibility to publicly amend, modify or revise any forward- looking statements on the basis of any subsequent developments, information or events.

Overview of financial year (fy)

According to the monetary policy report-april 2024 dated 5^th april 2024 published by the reserve bank of india: "……turning to the domestic economy, the second advance estimates (sae) released by the national statistical office (nso) placed real gross domestic product (gdp) growth for 2023-24 at 7.6 per cent, underpinned by strong investment activity. On the supply side, gross value added (gva) expanded by 6.9 per cent in 2023-24, with manufacturing and services sectors turning out to be the key drivers. Real gdp growth for q3:2023-24 was placed at 8.4 per cent, outpacing consensus forecasts by a wide margin, underpinned by strong investment and an improvement in private consumption….."

Key performance indicators of the company are given below:

• the gross turnover decreased by 22.50 per cent to rs. 457.84 crore in fy 2023-24 from rs. 590.73 crore in fy 2022-23.
• the total ebidta increased by 159.04 per cent to rs. 79.24 crore in fy 2023-24 from rs. 30.59 crore in fy 2022-23.
• the net profit increased by 1,448.56 per cent to rs. 53.89 crore in fy 2023-24 from rs. 3.48 crore in fy 2022-23.

Details of significant changes in key financial ratio along with detail explanations

S. No. Particulars	2023-24	2022-23	% of change remarks From 2022-23 To 2023-24
1 Current ratio	12.53	12.03	4.16 primary due to repayment of current borrowing
2 Debt service coverage ratio	-	-
3 Return on equity ratio	-	-
4 Inventory turnover ratio	7.32	8.16	(10.29)
5 Trade receivables turnover Ratio	9.14	10.36	(11.78)
6 Trade payables turnover ratio	86.81	109.41	(20.66) primary due to decrease in revenue from Operation.
7 Net capital turnover ratio	1.64	2.67	(38.58) primary due to decrease in net capital assets And revenue from operation.
8 Net profit ratio	0.12	0.01	1100% primary due to exceptional items in previous Year
9 Return on capital employed	0.05	0.05	-
10 Return on investment	-	0.01	Primary the to profit or sale non - current Investment in previous year

Business review

Jai corp is a stakeholder in following entities-

I- Navi Mumbai IIA private limited (NMIIA) performance overview:

Government of maharashtra (gom) had, in its industrial policy of 2013 subject to certain terms and conditions, allowed sez to exit and move towards being developed as integrated industrial area (iia). Nmiia had received approval from ministry of commerce – goi to denotify its sez and accordingly all its sez have been denotified. Approval from gom to develop the project as an iia has been received. The project parameters will not change, and now even local industries will be able to set up units in iia. Nmsez is in the process of taking required consents and approvals from gom / cidco in this regard.

Ii- mumbai sez limited (MSEZ) performance overview:

Msez has acquired land in uran, pen and panvel areas in the state of maharashtra. So far, consent award and sale deeds have been executed for around 4,600 acres. The subject land is not contiguous. The land acquisition act which has been notified in january 2014 makes it difficult to buy land for contiguity. Msez is in discussion with gom on way forward.

Iii- rewas ports limited (RPL) performance overview:

Rpl has signed the lease deed with maharashtra maritime board (mmb) for 839 hectares (ha) of inter tidal land. The government land of about 167 hectares has been transferred by the gom to mmb. Mmb will sign the lease deed for the same at the time of financial closure. Rpl has been in discussions with indian railways and gom to firm up the rail and road connectivity of the port with the hinter land. Rpl has been persistently working to resolve the key issue related to right of way from mumbai port trust, but progress is slow. Unless this issue is resolved the project is unable to progress.

Real estate sector overview:

According to a report of the confederation of real estate developers Rs. association of india (credai), titled: "building viksit bharat-transformative role of the real estate sector" published in march 2024 and quoted by the press trust of india – Rs.the real estate sector is estimated to reach a market size of usd 1.3 trillion by 2034 and usd 5.17 trillion by 2047." The current market size of indian real estate is rs. 24 lakh crore (around usd 300 billion), split between residential and commercial segments in the ratio of 80 per cent and 20 per cent, respectively.

Our business:

Certain subsidiaries of jai corp had acquired land. The same may be consolidated for the purpose of development subject to the applicable legislations at that point of time. The company is of the view that any presumed fall in the current valuation of land held by some of the subsidiary companies is a temporary phenomenon. These are long-term investments and in the course of time are expected to realise their fair value.

Performance overview:

One of the wholly-owned subsidiaries of the company, swar land developers limited, is developing an industrial estate near mumbai. Construction of phases i, ii & iii are complete and are being disposed of. It has reported a net profit of about rs. 1.21 crore during fy 2023-24 as against a net profit of about rs. 0.05 crore during fy 2022-23.

Oasis holding fzc earned rs. 7.79 crore as rental income from labour accommodations in the united arab emirates during the fy 2023-24 as against rs. 8.20 crore during the fy 2022-23.

Steel division sector overview:

The world steel association (worldsteel) released its short range outlook (sro) steel demand forecast for 2024 and 2025 in april, 2024. "worldsteel forecasts that this year demand will see a 1.7% rebound to reach 1,793 mt. Steel demand is forecast to grow by 1.2% in 2025 to reach 1,815 mt." About india it says: "india has emerged as the strongest driver of steel demand growth since 2021, and our projections suggest indian steel demand will continue to charge ahead with 8% growth in its steel demand over 2024 and 2025, driven by continued growth in all steel using sectors and especially by continued strong growth in infrastructure investments. In 2025, steel demand in india is projected to be almost 70 million tonnes higher than in 2020."

Performance overview:

Jai corp manufactures cold rolled coils, galvanized coils and galvanized corrugated sheets at its nanded unit in maharashtra. During fy 2023-24, the company did not produce any cold rolled coils (cr) due to lack of demand and achieved a production of gp/gc coils and sheets decreased to nil metric tonnes ( Rs.mt Rs.) during fy 2023-24 from 1,030.01 mt during fy 2022-23. The third-party production (job work) of nil mt during fy 2023-24 as compared to 1962.91 mt of galvanized plain and galvanized corrugated steel sheets (gp/gc) sheets during fy 2022-23. The division reported turnover of 0.26 crore in fy 2023-24 as compared to rs. 24.92 crore in fy 2022-23. It reported a loss of rs. 0.05 crore in fy 2023-24 as compared to a profit of rs. 3.19 crore in fy 2022-23.

Plastic processing division tape woven products sector overview:

The usage of polyethylene (pe)/ polypropylene (pp) woven tape products like sacks, bags, flexible intermediate bulk containers (fibcs), fabrics, geotextiles etc. Has been growing in india. Fibc bags are constructed from woven pp fabric which may be single layered, with extra loose liner, or laminated. Pp when treated with ultra violet acts as electrical insulator.

According to indian flexible intermediate bulk containers association( Rs.ifibca Rs.) website: "today india is exporting about 40,000 mt per month of fibc at a very steady cagr.

Global fibc market size has been valued at usd 4.0 billion in 2018, expected to advance at a cagr of 5.9% over coming years. Total global fibc trade is 2.5 billion usd ($2,416,767,511) and india alone exports fibcs about worth 0.7 billion usd ($702,569,203) which is more than 25% of global fibc trade."

Performance overview:

The company Rs.s production decreased by about 9 per cent to 36,165 mt in fy 2023-24 as compared to 39,743 mt in fy 2022-23. The gross turnover decreased by about 19.06 per cent to 457.58 crore in fy 2023-24 as compared to gross turnover of rs. 565.35 crore in fy 2022-23. The net profit decreased by about 10.11 per cent to rs. 65.27 crore in fy 2023-24 as compared to 72.61 crore in fy 2022-23. The company Rs.s exports were 2404.57 mt in fy 2023-24 as compared to 3404.82 mt in fy 2022-23. The fob value of the exports decreased by about 43.80 per cent to rs. 39.77 crore in fy 2023-24 as compared to rs. 70.77 crore in fy 2022-23 due change in international scenario and our policy of concentrating on high value products.

Human resource development

Jai corp Rs.s most valuable assets are its human resource. With the support of its dedicated human resource, it confronted the rapid changes in the business environment last year with the resolve and determination to ensure that the business of the company continues to enhance value creation. The company Rs.s talent pool as on 31^st march 2024 was 1,443 which includes highly qualified professionals across all its business segments. The growth and sustained leadership of the company is largely a function of its human resource. The company has always aimed to create a workplace where every person can achieve his/her optimum potential. The company has a performance rewarding culture, enabling it to create leaders out of its employees. The company has also undertaken various training and development initiatives to hone the skill and expertise of its employees.

With diversified business interests, the company empowers the inter-departmental and inter – unit movement to deserving individuals, ensuring better retention of talent and at the same time providing avenues to its employees.

Internal control system

Jai corp has a comprehensive system of internal controls to safeguard the company Rs.s assets against loss from unauthorized use and ensure proper authorization of financial transactions. The system ensures the integrity of the accounting, recording and reporting of all transactions. It monitors and controls against any unauthorized disposition of assets, thus safeguarding the company Rs.s assets.

Jai corp ensures adherence to all internal control policies and procedures as well as compliance with all regulatory guidelines. This enhances the reliability of financial and operational information. The company has appointed a reputed firm, kakaria and associates llp as the internal auditor. The audit committee of the company periodically reviews, with the management, inter alia performance of the internal auditor and adequacy of the internal control systems.

The internal control systems are adequate and commensurate with the size of the company and the nature of its business.

Risk concerns and risk management

Jai corp is exposed to the normal industry risk of factors of competition, economic cycle, raw material availability and uncertainties in the international and domestic markets and credit risk. The company has a system - based approach to business risk management. It has a proper and adequate system of controls designated to assist in the identification and management of risks. The company manages these risks by maintaining a conservative financial profile and by following prudent business and risk management policies:

a) clearly laid down roles and responsibilities of the various entities in relation to risk management.

A range of responsibilities, from the strategic to the operational, is specified therein. These role definitions, inter alia, are aimed at ensuring formulation of appropriate risk management policies and procedures, their effective implementation, independent monitoring and reporting by internal audit.

B) a combination of centrally issued policies and divisionally-evolved procedures to bring strength to the process of ensuring that business risks are effectively addressed.

C) appropriate structures are in place to pro-actively monitor and manage the inherent risks in businesses with proper risk profiling.

D) a professional and independent firm has been appointed as internal auditor to carry out the risk focused audits across divisions, enabling identification of areas where risk management processes may need to be improved. The audit committee of the board of directors regularly reviews internal auditor Rs.s findings and provides strategic guidance on internal controls.

E) a comprehensive framework of strategic planning and performance management ensures realization of business objectives based on effective strategy implementation.

The annual planning exercise requires all divisions to clearly identify their main risks and set out a mitigation plan with agreed time line and accountability.

Health, safety and environment

Jai corp is committed to ensuring the health and safety of its employees, its plants and its surrounding communities at all its operations sites. It Rs.s the constant endeavor of the company to provide safe and hygienic working conditions for its employees.

The company also strives to maintain a pro-active check on environmental compliance in its operations. Some of the initiatives undertaken by the company in this regard are as follows:

a) well defined work practices ensure work in a manner that promotes safety and health of its employees as well as that of the environment they operate in.

B) provide training to all concerned personnel to maintain health, safety and environment.

C) creating awareness on health, safety, environment and developing the required skill, knowledge and confidence of the personnel so as to enable them to understand their responsibility.

D) provide all required safety poster, safety equipment, first-aid box and facility, purified drinking water and adequate medical facility under the aegis of a full time qualified medical practitioner.

E) maintaining excellent housekeeping practices across all locations and premises of the company.

F) maintaining safe, healthy and pollution-free environment in the work places with suitable safe work systems and methods of work like protective fencing of machinery, periodical testing of hoist and lifts, ropes and chain pulley blocks, testing of pressure vessels.

Periodical and preventive maintenance of compressors and proper arrangement of fire extinguishers at designated places.

G) obtaining a stability certificate for all the factory buildings as per the requirement of the factories act, 1948.

H) developing safety awareness among the staff and other concerned workers.

I) maintaining environmental norms prescribed by state / central governments in the matter of air, water, quality, noise, environment etc.

J) cleaning and disposing off of wastes and effluents, proper ventilation and sustaining of pollution - free atmosphere.

K) taking suitable insurance policies such as fire, safety, group, personal accident etc.

Corporate social responsibility and community development

An essential component of jai corp Rs.s social responsibility is to care for the community. The company endeavours to make a positive contribution to underprivileged communities by supporting a wide range of activities like socio-economic development, educational promotion, rural development, livelihood and skill development training, providing clean and safe drinking water to tribal villagers, tree plantation drive and health initiatives. Many of the community projects and programmes are driven by active participation from our employees. We, at jai corp, have defined a set of core values for ourselves - care, innovation, passion and trust – to guide us in all we do. We have decided to act as a catalyst between the government and the people.

1 education promotion programme:

education yields numerous benefits and profoundly impacts human life; an educated individual stands as an asset for our nation, with human capital being recognized as the paramount national resource. Guided by this principle, the company launched an educational promotion initiative in the fiscal year 2014-15. Under this program, we have undertaken the sponsorship of tuition fees for domicile students of dadra and nagar haveli and daman and diu (dnhdd), directly remitting payments to the respective institutions. Special emphasis is placed on supporting economically disadvantaged students.

in the fiscal year 2023-24, the company extended sponsorship to 436 students, encompassing various disciplines such as mbbs, bams, bds, diplomas and degrees in engineering, pharmacy, nursing, paramedical courses, and hotel management. Additionally, we introduced sponsorship for two new courses: "bachelor of design" and "master of fashion management" at the national institute of fashion technology (NIFT), and "ba – llb" at the gujarat national law university (gnlu).

2 skill enhancement and development programme: heavy motor vehicle training programme:-

this initiative was initiated in collaboration with the transport department and the district panchayat

Department of the administration of d & nh. For beneficiary enrollment, we received support from the district panchayat, d & nh. Through 20 panchayats, we enrolled 41 candidates for heavy motor vehicle (hmv) training, all of whom completed the training in the year 2023-24. The objective of the hmv training program is to promote, encourage, and assist unemployed tribal candidates, including school dropouts, in dnhdd, by providing them with skill-based training to create employment opportunities.

3. Safe drinking water to all:

all children have the right to clean water and basic sanitation as stated in the convention on the rights of a child, the ultimate aims of unicefs work in water, sanitation and hygiene (wash) is to ensure that all children fulfil this right, school attendance in india decreases when children are required to spend hours collecting water and close 54 per cent of rural women

– as well some adolescent girls

– spent an estimated 35 minutes getting water every day, tribal communities of dnh and dd face a huge challenge in ensuring a clean and safe drinking water supply. For fulfilling the need of local communities jai corp has been installed 21 nos. Of reverse osmosis (ro) water purification plants at a various places dnhdd. More than 52,000 school students and villagers are expected to avail the benefit of safe drinking water. Reports show that after the installation of ro water purification plants, there is a drastic reduction in water borne diseases like diarrhoea, typhoid, abdominal pain etc. We are doing regular maintenance expense of installed ro water purification plants. It is expected that the clean and wholesome drinking water initiative will improve the quality of life, health general well-being in tribal areas of dnhdd.

4. Rural development project:

we have received a request from the administration of dnhdd to provide construction materials for building houses under the pradhan mantri awas yojna. The total approximate beneficiaries are 3500. Additionally, there is a need for repair work at the police station in naroli, including renovation and maintenance of the roof, painting, and other necessary upkeep of the existing shed.

5. Promoting preventative healthcare:

under this initiative, we provided free blood units to patients suffering from thalassemia and sickle cell anemia in dnhdd, in collaboration with the blood bank of the indian red cross society in silvassa. During the year 2023-24, we supplied 342 blood units free of charge to 342 patients affected by thalassemia and sickle cell anemia in dnhdd.