Likhami Consulting Ltd Management Discussions.

Pursuant to Listing Regulation of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 aligned with Companies Act, 2013, the Management Discussion & Analysis Report for the year under review is given below;


The Management Discussion and Analysis Report sets out the developments in the business, the Companys performance since the last Report and the future outlook. This Report is part of the Directors Report and the Audited Financial Statements, forming part of the Annual Report. However, certain statements made in this Report relating to the projections, outlook, expectations, estimates, etc., may constitute "forward looking statements" within the meaning of applicable laws and regulations and may differ from actual. Several factors could make a significant difference to the Companys operations, including climatic conditions, economic conditions affecting demand and supply, government regulations, revision in government policies, taxation and natural calamities over which the Company does not have any control.

Our strategic objective is to build a sustainable organization that remains relevant to the agenda of our clients, while creating growth opportunities for our employees, generating profitable growth for our investors and contributing to the communities that we operate in.

Our vision is to build a globally-respected organization delivering the best-of-breed business solutions, leveraging technology, delivered by the best-in-class people. We are guided by our value system which motivates our attitudes.

The need for professionals who are highly skilled in both traditional and digital technology areas are driving businesses to rely on third parties to realize their business transformation.

Global Scenario:

Management consulting is the industry and practice of helping organizations improve their performance by analysing existing problems and development plans for improvement. Organizations hire management consulting firms to gain external advice or when they need specialized expertise and services which are offered by consultants include strategy, operations, financial advisory, human resources and internet technology. The largest markets for consulting services include operations and financial advising, more than double the human resources and strategy markets. However, all the management consulting markets are seeing average growth each year.

The size of the management consulting market from 2011 to 2021 and gives a forecast for 2022. Due to the coronavirus outbreak, the size of the consulting market is estimated to decrease to 135 billion U.S. dollars in 2021. Revenue in the U.S. management consulting industry amounted to almost US$217bn in 2017. We see a continuous growth. However, the average growth rate in the industry was shrinking until 2017 and we expect this trend to continue. While from 2011 to 2014 the CAGR was at +7.8%, between 2014 and 2017 it dropped to an average of +3.9% per year. The Statists estimate is that this trend will result in a growth of +2.2% from 2017 to 2023. This leads to total revenues of about US$248bn of management consultancies in the U.S. in 2023.

The COVID-19 pandemic developed rapidly into a global crisis, forcing governments to enforce lockdowns of all economic activity. The COVID-19 pandemic has had an immense impact on the way of life across the world. Every business has to fight the battle on both fronts—health and economic—and will have to endure this time of forced recession. With the global economic downturn running into trillions of dollars, speculations are rife that the recovery period might run well into early next years.

Industry Overview in India:

While the countrys GDP has contracted 7.3 per cent in FY21, growth was expected to bounce back in double digits in the current fiscal year as rapid vaccinations were expected to counter the second wave. Indias economy is unlikely to see double-digit growth and may grow between 8 per cent and 9 per cent this fiscal year (2021-22, or FY22), against the estimated 11.5 per cent, according to leading economists and rating agencies.

COVID IMPACT - GDP Growth forecast for FY2022

SBI 7.9%
ICRA 8-9.5%
CARE 8.8-9%
India Ratings 10.1%
RBI 10.5%
Economic Survey 11.5%

"It is a good thing that gross domestic product (GDP) contraction of 2020-21 (FY21) is slightly better than expected, but downside of it is that FY22 numbers will now undergo revision and will be in single digits since the base has been significantly revised downwards. Given the pace of vaccination, it is unlikely a large part of the population will be vaccinated by the second quarter of the year. The overall growth prospect looks bleak,"

We dont know the figures for Indian consulting industry but I am reliably told its anywhere near or over $21 billion. The consulting industry is seeing an increase in the number of new comers and is actively exploring prospects in new industries and all growth routes. However, low quality assurances, low market intelligence, low equity base, low overseas exposure, and absence of R & D are major weaknesses hindering the growth of the consulting sector. Indian consulting is maturing as fast as the Indian industry matures.

Generally, we agree that the biggest challenge for the Indian consulting firms is to compete with the global players in the market Overall, at the pace its growing, there is a need to strengthen the framework of Indian consulting industry by embracing innovation, nurturing talent, improving the quality of consulting services, and enhancing consulting skills. The major strengths of Indian consulting organizations include professional competence, low cost structure, diverse capabilities, high adaptability and quick learning capability of Indian consultants.

Due to constantly increasing demand, the industry is estimated to grow at a compounded annual growth rate of 30 percent by 2021, as per the reports of The Associated Chambers of Commerce and Industry of India (Assocham). The Indian consulting industry has seen a substantial growth, not only in terms of size, but also in terms of the service offerings. In recent years, the demand of specialist consulting services is being immensely sought by customers in India, which has eventually opened the opportunity for a large number of consultants to help businesses with expert knowledge base and resources.

As of now, there are about 6500 consultancy firms in metropolitan cities including Delhi (25.5 percent) followed by, Mumbai (27.5 percent), Chennai (12.5 percent) and Kolkata (9.7 percent). Moreover, service sector contributes more than 40 percent to nations GDP. Besides, there are around 2000 R&D institutions and laboratories supporting several domestic consultancy organizations directly or indirectly at a reasonable cost.

This fast growth of this sector in India is largely attributable to improved investment activities because of low-cost structure, entry of many big players into the Indian market, relaxation of previous

FDI restrictions, and strong capabilities in areas like IT, management, civil engineering, telecommunication, petrochemicals, power and metallurgy. The steady growth will ultimately lead to expected rise in hiring activities.

The Demand of Consulting Services in India

Due to the involuntary reduction in workforce, many organizations lack the technological, strategic and project management abilities to handle market and technical changes in the ever growing market. Therefore, currently, the business world desperately needs consulting assistance. It is projected that by the next three years, there would be more than 2.2 lakh people getting employment in almost 10,000 consultancy firms across the nation.

Owing to the shortage of enough qualified people, some consulting firms have already devised creative solutions by launching their own accredited MBA programs. Many people are inclined towards this profession because of its heightened demand and visibility, along with enticing salary packages.

The Major Strengths of the Industry

The major strengths that set Indian consultancy firm above the consultancy organizations of developed economies are professional competence, low-cost structure, high acceptability, flexible thinking, high learning agility, strong interpersonal skills, focused approach and overall business understanding. Moreover, their expertise in diverse areas and familiarity with the local conditions are a few other reasons that help them to score over the global players. However, the Indian consulting sector has some shortcomings, which have been hindering the export growth such as limited local presence in a foreign country due to lack of intensified market expertise, low quality assurance, low brand equity, lack of strategic tie-ups, insufficient international experience of Indian Consultants working overseas, and low level of R&D. Despite these limitations, the consulting sector in India is responding creatively to the changing needs of the clients and seeking innovations to meet their future needs.

The adoption of best practices data warehousing, knowledge management tools and internet ensures the faster growth of this industry in near future. Despite the expansion of the consulting organizations, the size of individual firms is growing in response to another industry trend. Consulting firms that are unable to compete on size are trying to fulfil the clients requirements by outsourcing their project to another firm while maintaining responsibility for the overall project.

Our consultancy services are as under:

Management Consultancy, Project Consultancy, Consultancy to NGOs, Project Feasibility Studies, Techno-Economic Viability Studies, Market Survey, Research and Branding, Brand Launch Strategies, Industry Research, Project Report Preparation, Foreign Investments related consultancy in Indian Market, Financial Consultancy, Artificial Intelligent (AI), Technical Collaboration and International Tie-up.

Basis of preparation and presentation of our Financial Statements:-

The Financial Statements have been prepared and presented under the historical cost convention, unless otherwise specifically stated, on the accrual basis of accounting and comply with the applicable accounting standards referred to in the Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014.

Opportunities and Threats:


The niche for growth within the current market players and the new comers will continue to provide support to the business. Also, the Start-up policy and fostering entrepreneur spirit will create more employment opportunities in the country. Make in India initiative and increased incentives for the global players to set-up their facilities in India to aid in more employment generation and business in consultancy sector.

Artificial Intelligence (AI) is the branch of computer sciences that emphasizes the development of intelligence machines, thinking and working like humans. For example: speech recognition, problemsolving, learning and planning.

Artificial Intelligence is gaining popularity at a quicker pace; influencing the way we live, interact, and improve customer experience. There is much more to come in the coming years with more improvements, development, and governance.

Digital Marketing is growing at a rate of 25-30% in India annually. And if statistics are to be believed, India has reached 700 million users of the internet by the end of 2022. ... The high-speed digitization, online portals, social media channels, etc lead to a growth of digital marketing in a trend par imagination. Digital Marketing demand has increased consistently over the last few years.


a) Competition in the Indian market from large consultancy organizations and new entrants

b) Pandemic Covid-19 situation and uncertainty on recovery and resurgence.

c) Unfavorable Government regulations

d) Unfavorable macro-economies and micro-economies conditions

e) Recession in Industrialization and business environment

f) Unable to retain talented staff if recruited by competitors

g) Inability of retain top talented team members

h) Geographically located in East India and presently not covering pan India

i) Increase cost of operations

Business Segment:

The Company is into the business of Consultancy services and other allied services. The company operates mainly in Indian Market.


Consultancy opportunities will increase in areas like management consultancy, Artificial Intelligence, Digital Marketing and Block Chain , financial consultancy, information technology, market research, etc. The consultant will be more professional, demanding and seeking tangible results. The Company will get repeat orders by providing quality service followed by service guarantee. The client feedback in the market will continue to be the determinant for selection of consultants. With the accelerated pace of economic reforms and liberalization, powerful winds of change are sweeping through Indian organizations. The consultant must be proactive to the changes acting as an agent of change. He must adopt new work culture, attitude and ethics and constantly try to achieve competitiveness. The Company has objective to develop a new value system in which total commitment to the client is the ultimate objective. The value system must ensure client-satisfaction in delivering the services, maintaining work schedules, and most importantly, focusing on the clients interest at all times. The consultant will be increasingly called upon to get involved in the implementation of recommendations. In short, the relationship between a consultant and his client will be strong, intimate, facilitating and mutually beneficial.

Risk and Concerns:

Uncertainties in business offer opportunities and downside risks. Consequently, the Company recognizes the importance of well-structured system to identify and manage the different elements of risk. Pressure on margins, high manpower and infrastructure cost, availability of substitutes, higher overheads, are some factors which could impact adversely especially as we strive to tap into the competitive markets.

Internal Financial Control and their Adequacy:

The Company has in place well-defined internal control mechanisms and comprehensive internal audit programmes with the activities of the entire organization under its ambit.

Human Resources:

Human Resources Development envisages the growth of the individual in tandem with the organization. It also aims at the upliftment of the individual by ensuring an enabling environment to develop capabilities and to optimize performance.

Your Directors want to place on record their appreciation for the contribution made by employees at all levels, who through their steadfastness, solidarity and with their co-operation and support have made it possible for the Company to achieve its current status

The Company, on its par, would endeavour to tap individual talents and through various initiatives, ingrain in our human resources, a sense of job satisfaction that would, with time, percolates down the line. It is also the endeavour of the Company to create in its employees a sense of belonging, and an environment that promotes openness, creativity and innovation.

Material Developments in Human Resources:

Our professionals and employees are our most important assets. We believe that the quality and level of service that they deliver is a huge contributing factor in growth and development of the Company.

Discussion of Financial Performance:

Directors of your Company are very hopeful to build up the performance of the company and post better results in the forthcoming 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:

(Amount in Rs.)
Particulars 2020-21 2019-20 2018-19
Profit Before Tax 13,63,700 1,68,594 8,27,259
Profit after Tax 9,93,440 46,783 1,12,974
Earnings Per Share 0.10 0.00 0.01

Details of Significant Changes: -

Sl. No. Particular F.Y. 20-21 F.Y. 19-20 Reason
1 Debtor Turnover Ratio (Months) 3.88 3.23
2 Inventory Turnover Ratio - - Not Applicable
3 Interest Coverage Ratio - - Not Applicable
4 Current Ratio 115.91 125.51
5 Debt Equity Ratio - - Not Applicable
6 Operating Profit Margin Ratio 26.28% 3.35% Due to decrease in employee benefit expenses and operating expenses.
7 Net Profit Margin Ratio 19.14% 0.93% Due to decrease in employee benefit expenses and operating expenses.
8 Return on Networth 0.26 0.01 Due to decrease in employee benefit expenses and operating expenses.

Cautionary Statement:

Statements made in the Management Discussion and Analysis Report describing the Companies objectives, expectations or predictions may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement important factors that influence the Companys operations, include global and domestic supply and demand conditions. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only of their dates.