Kisan Mouldings Management Discussions



The past year has been another turbulent year with the global economy marred by profound shocks and unprecedented uncertainty. The global economic growth has moderated amidst the prolonged Russia-Ukraine war, even though the effect of the pandemic has receded. Food and energy price shocks affected the general prices, and other factors contributed to elevated inflation across countries. The recent failures of banks in the United States are a reminder of the challenges posed by the interaction between tighter monetary and financial conditions and the buildup in vulnerabilities. Though inflation has receded with central banks raising interest rates, underlying price pressures are proving sticky, with labor markets being tight in several economies. In parallel, debt levels remain high, limiting the ability of fiscal policymakers to respond to new challenges. Commodity prices have moderated, but the elevated geopolitical tensions are the key risks. However, earlier than expected opening of China is easing supply chain disruptions and renewing hopes for moderate economic recovery. As per IMF projections, world growth will bottom out at 2.8% this year before rising modestly to 3.0% in 2024. During the year, RBI increased the policy repo rate by 250 bps in 6 tranches and the Banks have also transmitted it to the credit rates across the Board. Against this backdrop of global uncertainties and spike in lending rates, Indian economy has remained resilient with robust agriculture and services sector. Meanwhile, on the external front, exports of goods and services reached new heights supported by strong demand of Indian services. Indias GDP in FY2023 grew at 7.2%, driven by buoyant investment and private consumption. Looking ahead, real GDP growth is projected at 6.5% in FY2024 (RBI), with economic activity backed by improving rural demand, the Governments thrust on infrastructure spending, revival in corporate investment, healthy bank credit, and moderating commodity prices.

Domestic economic activity exhibited resilience in FY2022-23. The National Statistical O_ces (NSO) provisional estimates placed real Gross Domestic Product (GDP) growth at 7.2% for FY2023, driven by investment and private consumption. On the supply side, activity was supported by buoyant agriculture and services sectors, while manufacturing was restrained under the pressure of high input costs. India continues to be the fastest-growing economy for the third time in succession.


Kisan Mouldings Limited has carved a niche in the field of pipes and fittings for water management, irrigation, water distribution and sewage disposal systems over the last three decades. Your company has emerged as one of Indias leading manufacturers of Plastic piping Company including Chlorinated Poly Vinyl Chloride (CPVC) and Poly Vinyl Chloride (PVC) Pipes and also leading in irrigation system and plumbing systems for residential, commercial and industrial consumption and processes around 20,000 - 40,000 MT of polymer every year. The Companys plumbing range consists of KML Classic CPVC Plumbing system, Free Flow uPVC Plumbing system (ASTM). It provides ‘One-stop piping solutions with its wide range of PVC and CPVC pipes, fittings and solvents.

During the year under review, your Company has its pipe manufacturing facilities in India at Tarapur in the state of Maharashtra, Dewas in the state of Madhya Pradesh, Umerkui and Khadoli at Dadra and Nagar Haveli for manufacturing of Pipes, Fittings and Solvents manufacturing of plumbing systems, drainage systems, irrigation systems.


The management has taken several corrective steps, as below, to stage a turnaround in business performance.

Piping Brand Recognition: Since past few years, the Company has successfully achieved object of recognising KisaN and KML Classic as most popular brand plumbing systems and irrigation systems in various location of India.

Focus on high margin products: The Company is operating from various manufacturing sites including parent plant at Mahagaon, Maharashtra. We have increased number of SKUs in the fittings segments and are now offering wider variety of solvents. These are high margin products and help to improve overall margin profile.

Distribution channel: The Company is continuously working on strengthening its distribution network by strategically locating its warehouses and manufacturing facilities with extensive distribution channel. The Company has also been participating in several exhibitions and large meets of plumbers, dealers with smaller groups in order to maintain appropriate discipline in COVID-19 atmosphere and strengthen and widen its distribution network.. The Company is serving its customers through opening and maintaining Depot in order to reach its prospective buyers for creating customer base for the Company in a cost efficient manner.


In FY 2022-23, on a consolidated basis, the pipes and fittings segment contributed the revenue from operations of Rs 27,299.36 Lakhs. Your companys new and renewed focus makes it well poised to seize opportunities arising in the sectors where we operate.

Construction piping:

India is in the midst of a major construction drive that is mainly supported by the Government of India. Multiple schemes and projects launched in last couple of years are leading to higher demand for pipes.

Real Estate Regulation Act (RERA): RERA has created a major transformation the way housing construction for sale was in vogue in the country. Many prominent business houses have made ambitious plans in this sector to grow geometrically with launch of their projects at multiple locations. It is expected to get good demands from Plastic Piping sector on continual basis.

Jal Jeevan Mission: Jal Jeevan Mission (JJM), which was introduced in the Union Budget 2019, is envisioned to provide safe and adequate drinking water through individual household tap connections "Har Ghar Jal" (piped water supply) to all households in rural India., The Government of India in the Union Budget 2021-22 had announced that the Jal Jeevan Mission (Urban), which aims at universal water supply in all 4,378 Urban Local Bodies with 2.86 crores household tap connections, as well as liquid waste management in 500 AMRUT cities. It will be implemented over 5 years, with an outlay of 2,87,000 crores.

AMRUT: The Atal Mission for Rejuvenation and Urban Transformation (AMRUT) was launched with the focus to establish infrastructure that could ensure adequate robust sewage networks and water supply for urban transformation by implementing urban revival projects. Some of the broad targets of AMRUT scheme are ascertaining that everyone has access to tap water and sewerage facilities, greenery like parks and open spaces are well maintained, digital and smart facilities like weather prediction, internet and WiFi facilities, pollution reduction by encouraging the public for using cheaper but secure public transport etc.

Swachh Bharat Abhiyan: It is a country-wide campaign initiated by the Government of India to eliminate open defecation and improve solid waste management The GOI in Union Budget 2021 has focused on swachhta of urban India, and has intended to focus on complete faecal sludge management and waste water treatment, source segregation of garbage, reduction in single-use plastic, reduction in air pollution by effectively managing waste from construction-and-demolition activities and bio-remediation of all legacy dump sites. The GoI has announced that the Urban Swachh Bharat Mission 2.0 will be implemented with a total financial allocation of Rs 1,41,678 crores over a period of 5 years from 2021-2026.

Agriculture piping and micro irrigation:

Agriculture being an important sector of Indian economy and due to dependency of around 50% of agricultural lands on monsoon, the Government of India (GOI)_has increased its focus on improving irrigation coverage area, which is expected to drive demand for PVC plastic pipes over the medium-to-long term. The GoI has laid down several initiatives, schemes and reforms that would directly and indirectly trigger higher demand for plastic piping as well as micro irrigation products.

The Government has given a clarion call to double farmers income. This is to be achieved by helping farmers to produce more from the same land parcel at lesser cost and at the same time fetch higher prices for their produce. More agricultural land is expected to be brought under irrigation resulting in effcient modes of water transportation. Government is hopeful to form 10,000 new Farmer Producer Organizations, to ensure economies of scale for farmers over the next five years.

Pradhan Mantri Krishi Sinchayee Yojna (PMKSY):

It has been formulated with the vision of extending the coverage of irrigation ‘Har Khet ko pani and improving water use effciency ‘More crop per drop in a focused manner with end to end solution to increase area under irrigation, flood control, interconnectivity of canals which is expected to augment the demand of PVC pipes.


Favourable factors like consistent agricultural performance, massive initiatives taken by the GOI in the areas of agriculture, construction of a_ordable houses, water supply and sanitation, leads to upsurge in the demand for plastic piping products and irrigation system. Similarly, reforms such as GST and RERA would result in favourable playing field for organized players. These favourable macro-economic variables point towards an encouraging outlook for the year 2023-24. We intend to leverage on these opportunities.

The Companys efforts towards improving processes and operational efficiencies through automation are expected to deliver desired benefits. The Companys attempts for the improved quality of its distribution network will help the Company to control costs and maintain its competitive advantage. There is focused effort towards increasing revenue contribution from high margin products to aid overall margins of the Company.


An overview of the financial performance is given in the Directors Report. The Audit Committee constituted by the Board of Directors periodically reviews the financial performance and reporting systems. Summary of Standalone and Consolidated Profit and Loss for the Financial Year 2022-23 are as follows:

Summarised Profit and Loss Accounts

(Amount in lakhs)


Standalone Consolidated
FY 2022-23 FY 2021-22 FY 2022-23 FY 2021-22
Revenue from Operation 27299.36 30716.88 27299.36 30716.88
Other Income 247.92 371.85 246.72 370.65
Operating cost 29451.90 35729.11 29452.59 35732.3
EBDIT -1904.62 -4,640.38 -1906.51 -4,644.77
Depreciation 800.57 883.04 800.57 883.04
EBIT -2705.19 -5523.42 -2707.08 -5,527.81
Finance Cost 2738.48 2,975.03 2743.54 2980.83
EBT -5443.67 -8,498.45 -5450.62 -8,508.64
Taxation 0.00 0.00 0.00 0.00
Profit/ Loss for the year -5443.67 -8,498.45 -5450.62 -8,508.64
Other Comprehensive Income 30.83 23.54 30.83 23.54
Total Comprehensive Income/Loss -5412.84 -8,474.91 -5419.79 -8485.10
Basic EPS (in ) -16.08 -25.10 -16.10 -25.13



Standalone Consolidated
FY 2022-23 FY 2021-22 YOY (Change in %) FY 2022-23 FY 2021-22 YOY (Change in %)
Debtors turnover (in days) 77.51 82.84 -6.44% 77.89 83.21 -6.40%
Inventory turnover (in days) 90.60 106.08 -14.59% 90.60 106.08 -14.59%
Interest Coverage Ratio -0.70 -1.56 -55.41% -0.69 -1.558 -55.40%
Current Ratio 0.43 0.55 -22.39% 0.43 0.55 -22.34%
Debt Equity Ratio -3.07 -19.09 -83.92% -3.08 -19.62 -84.31%
Operating Profit Margin (in %) -7.0% -15.1% -53.82% -7.0% - -15.12% -53.82%
Net Profit Margin (in %) -19.94% -27.67% -27.93% -19.97 % -27.70% -27.92%
Return on Net worth (in %) -85.45% -887.14% -90.37% -85.81% -912.79% -90.60%


The Company is exposed to the financial market risks from changes in rate of interest and inflation, global recessionary trend, economic slowdown, increase in financial charges, non-availability (or undue increase in cost) of raw materials coupled with market fluctuations. The volatile movements in exchange rates are caused by major geopolitical developments besides mere economic and financial issues which are beyond the control of your Company. The Company is utilizing numerous bank facilities and consequently our financial cost is on the higher side. We have seen delays in customer orders, delays in execution of on-going orders, delays in payments by customers and logistics and supply chain challenges to keep our operations running smoothly. As a result the Company is currently facing cash constraints in making timely payment to its creditors, meeting certain regular operational expenses and serving debts and other financing arrangements. While we have made all efforts and resumed our operations to as normal as possible in the current situation, we will be exposed to the overarching impact of this pandemic. We will continue to monitor the situation and business outlook, while closely watching our cash position and expenses and respond appropriately with corrective actions.

Further due to limited workforce and restrictions on deployment of employees in our manufacturing units and offices, the capacity utilization will not be at the desired level. This will affect performance, turnover/ profitability and consequent liquidity position of the Company in the short run. The Company is planning to restrict the production based on the market demand and also reduce the overhead cost proportionately. In view of unprecedented & di_cult times, the Companys focus shall remain on all critical areas of cost control and cost reduction thereof and the finance cost being one of them shall always be a focal point for constant optimization.

Long lead time in release of State subsidies leads to more requirement of working capital for MI Industry. However, the implementation of PMKSY by the Central Government is bringing some uniformity in release of subsidies. Many States are now releasing subsidies online.


The Company has adequate internal control procedure proportionate to the nature of its business and the size of its operations for the smooth conduct of its businesses. Internal auditors comprising of Independent professional firm of Chartered Accountants, M/s.Kava

& Associates, Chartered Accountants, Mumbai, FRN: 145721W have been entrusted the job to conduct regular internal audits and report to the management the lapses, if any. The internal control is designed to provide reasonable assurance with regard to maintaining proper accounting controls, protecting assets from unauthorized losses and ensuring reliability of financial and operational information and proper compliance with regulations. The Audit Committee, in its periodic Meeting, review the adequacy of internal control system and procedures and suggest areas of improvements. The recommendations of Internal Auditors and the Audit Committee are placed before the Board for their consideration and followed up effectively for its implementation. The Companys statutory auditors have, in their report, confirmed the existence of effective internal control procedures.


Your Company believes in total transparency in sharing information about its business operations with all its stakeholders. Your Company strives to provide maximum possible information in the Annual Report and also through other means like regularly posting of information on website of the Company, intimation to stock exchange and Publication in Newspaper wherever necessary to keep the stakeholders informed about the business performance.


Human Capital Management has always been a key focus area for Kisan Mouldings Limited which is evident from the fact that employees are one of our key stakeholders. Considering the health and safety of the employees of the Company and in line with the advisories, orders and directions issued by both State and Central Government in order to prevent the spread of the corona virus (Covid19) outbreak, the Company has operated all its plants and Registered office and Branch o_ces as per the advisories with limited workforce issued by Central & State Governments in the Lockdown period. Further the Company has also implemented Work from Home Policy to ensure the safety of employees during the said period. Your Company continues to maintain constructive relationship with its employees and deals with issues related to compensation, hiring, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training; thereby striving hard to provide a positive environment to improve employee e_ciency. Your Companys Human Resource Department aims to maximize the productivity by optimizing the e_ectiveness of its employees. Your Company commits to further align its

HR Polices in order to meet the growing needs of the business. The total number of permanent employees as on 31st March, 2023 was 467.


Certain statements in this Management Discussion and Analysis Report may be ‘forward looking statements within the meaning of applicable laws and regulations. Actual results might differ substantially or materially from those expressed or implied in the statement. Such statements reflect the Companys current views with respect to the future events and are subject to risk and uncertainties. Important factors that could make a difference to your Companys operations include changes in industry structure, significant changes in political and economic environment in India and overseas, tax laws, litigation and industrial relations. It also includes economic conditions affecting demand / supply, price conditions in the domestic and international markets. The Company undertakes no obligation to publicly amend, modify or revise any forward-looking statements on the basis, of any subsequent developments, information or events. This report is prepared on the basis of public information available on website / report / articles etc. of various institutions. The above discussion and analysis should be read in conjunction with the Companys financial statements included herein and the notes thereto. For and on behalf of the Board of Directors Kisan Mouldings Limited


Sanjeev A. Aggarwal

Chairman & Managing Director

(DIN: 00064076)

Date: August 14, 2023

Place: Mumbai