kalptaru papers ltd Management discussions

FINANCIAL HIGHLIGHTS: Turnover:

There were no Sales during the year under consideration, as the Company is closed. Hence, the turnover of the company is Zero.

Other Income:

Other income mainly consists of Interest income,profit on sales of assets, foreign exchange fluctuations and creditors written off.Other income for the year amounted to 31.74 Lacs as against 12.11 Lacs during the previous year.

Material Costs :

Purchase costs is 0.00 (Zero) for the year under consideration as there was no production during the year.There is no change in the Inventory of Raw Materials as compared to previous year.

Manufacturing Expenses :

Purchase Cost also includes Manufacturing Expenses mainly comprises Power & Fuel is 0.00, which is same as the previous year.

Employee Emoluments:

Employees emoluments (other than managerial remuneration) have increased to 8.09 Lacs during the year against 4.95 Lacs during the previous year.

Administrative, Selling and Other Expenses:

Major components of administrative, selling and other expenses include managerial remuneration, rent, postage, stationary, audit fees, traveling, commission on sales etc. Administrative, selling and other expenses for the year amounted to 52.57Lacs as against 56.61 Lacs during the previous year.

Interest and Finance Charges:

Interest and finance charges during the year come to 55.53Lacs as against 387.52Lacs during the previous year.

Depreciation:

Depreciation charge for the current year came to 295.95 Lacs as against 303.59 Lacs during the previous year.

Provision for Tax :

Provision made during the year towards current tax as Nil against Nil Lacs during the previous year. The deferred tax for current year was Nil.

Profit after Tax :

Net loss during the year was (1035.61) Lacs as against (260.25) Lacs during the previous year.

Financial Condition: Secured loans:

Secured loans stood at 3722.61Lacs as at 31^st March, 2017 as against 2992.66 Lacs as at 31^st March, 2016.

Unsecured Loans :

Unsecured loans as on 31^st March, 2017 were at 1350.24 Lacs as against 1268.75Lacs as on 31^st March, 2016.

Inventories :

Major items of inventories as of 31^st March, 2017 are as under :

(Rs. in Lac)

Particulars	2016-17	2015-2016
Raw Materials	32.62	32.62
Work in process
Finished goods	3.66	3.66

Debtors :

Debtors as on 31^st March, 2017 amounted to 120.56 Lacs as against 121.28Lacs during the previous year.

Fixed Assets :

Net block of the fixed assets at the end of the year increased to 3207.92Lacs compared to previous years figure of 3504.37Lacs.

B. SEGMENT WISE PERFORMANCE:

The company is operating in only one segment i.e. paper. However, there was not any production during the year under consideration.

C. AN INDUSTRY OVERVIEW:

The paper industry in India is having shortage of raw materials, as we do not have enough forests to meet the industry requirement of pulpable wood, hence the dependence on waste paper is on higher scale. The central pulp and papers research institute and many other organizations are actively involve to find out ways to increase collection of waste papers to reduce dependence on imports. The scenario of the paper industry and economy in general is buoyant even after the industry is exposed to global competition with globalization policy of the government. The industry is facing problems for availability of raw materials and high cost of power and steam.

D. SWOT ANALYSIS OF THE COMPANY: Strength:

Management depth and ability to manage client relationships.

R & D capabilities to develop efficient and cost effective process at short notice having a State of the Art dedicated R & D Center. Multi-purpose and multi-production facilities having Quality Certifications. Enhanced presence in the market through clientelebasis.

Opportunities:

The paper industry in subject to tough competition amongst various segments of manufactures within and outside the country. The threat of competition is comparatively less in the product which your company is manufacturing viz. Absorbent paper and newsprint. Your company is exclusively manufacturing Absorbent paper which is being supplied to almost all the decorative and Industrial Laminate manufactures, and the products have been well approved by them. The company is market leader in absorbent paper. The increase in demand from this sector will provide opportunity to your company to increase its sale and capture more market share. Moreover, Indian paper industry witnessing changes in business dynamics.

Threats:

Competition from other Indian companies operating in similar segments.

E. RISKS AND CONCERNS:

Your company is mainly focusing on R&D and manpower and the intelligence.Apart from the risk on account of interest and regulatory changes, business of the company are exposed to certain operating business risks, which is mitigated by regular monitoring and corrective actions.

F. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The company has proper and adequate system of internal controls commensurate with its size and nature of operations to provide reasonable assurance that all assets are safeguarded, transactions are authorized, recorded and reported properly and to monitor internal business process, financial reporting and compliance with applicable laws. The internal control system has been designed so as to ensure that the financial and other records are reliable and reflects a true and fair view of the state of the Companysbusiness. To further strengthen the Internal Audit system, including internal control systems and MIS, your company has appointed an experienced firm of Chartered Accountants as Internal Auditors.

G. INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT:

The Company believes that human resource is the most important assets of the organization. It is not shown in the corporate balance sheet, but influences appreciably the growth, progress, profits and the shareholders values. Unfortunately due to close down of manufacturing activity of the Company, the company as at year end has NIL employees on its role.

Cautionary Statement:

Statement made in the Management Discussion & Analysis describing the companys objectives, projections, estimates, expectations may be "Forward-looking statements" within the meaning of applicable securities laws & regulations. Actual results could differ from those expressed or implied.Important factors that could make a difference to the Companys operations include economic conditions affecting demand supply and price conditions in the markets in which the company operates, changes in the government regulations, tax laws & other statutes & other incidental factors.