Lotus Eye Hospital & Institute Ltd Management Discussions.

Indian Economy: 2019- 2020

Indian economy was in deceleration, stagnation during the financial year 2019-20 wherein, Indian economy grew at a 16 years low of 4.2% and just 31% in Q4 of that year. GDP growth was slipping for five consecutive quarters when reported in November 2019.

The Union Finance Minister presented a budget on February 1, 2020 spelling out measures to energize the Indian economy through a combination of short term, medium term and long term measures. Made in India and digital India initiatives were prominent among the many measures by the government to uplift Indias manufacturing sector and increase the purchasing power of average Indian consumer. Public health spending was to be increased by 2.5% of GDP by 2025.

Predicted future (in spite of slow down)

Indian GDP is expected to reach US $5 trillion by February 25 and India is expected to achieve upper middle income status by that year. Purchasing power is supposed to increase by 2040.

Among many factors, widespread adoption of Artificial Intelligence is supposed to be one among the factors boosting Indian Economy. With the proposed National Digital Health Blueprint (NDHB), the government is attempting to create an integrated nationwide database of health service providers, patient records for care continuum and patient consent management using open API framework. These technologies would ensure the proper integration of available data from all sources and make it available for analytics and AI-based services, paving the way for huge involvement, immense opportunities and steady growth possibilities for the health sectors in the country.

Eye care 2019 - 2020

All the above will also boost affordability for better eye care in our country.

Global Industry Structure and Development:

The global "vision care market size" is expected to reach USD 192.85 billion by 2026, exhibiting a CAGR of 5.6% during the forecast period. Increasing awareness regarding ocular diseases in emerging nations is expected to aid the growth of the market. The increasing adoption of vision care products will boost the vision care market growth in the forthcoming year. In addition, the growing cases of cataracts will create growth opportunities for the market. For instance, according to the World Health Organization, 51% of the worlds blindness is caused by cataracts. In addition, the increasing risks of cataract incidence predominantly in developing countries will fuel demand for vision care.

Eye care products like lenses might become cheaper. With increase in life expectancy it is likely that population will have more old people. This would make it necessary to carry out more cataract and other eye treatments.

So overall, the eye care demand would grow. The profession and business of organized eye care would have a large need and necessity.

Public participated companies like ours with organized structure, delivering both basic and advanced eye care in many cities with a brand name, would help the patient very significantly and earn money for the investor very ethically.

This was the general economic, health care economic and eye care related economic scene in 2019 - 2020.

Our financial performance

Our general performance financially was better than 2018-19 in revenue and profit margin.

On analysis of this we plan to concentrate on reducing the expenses and losses and improving the profitability.

Segment-wise or product-wise performance

Your Company operates in only one segment i.e. Eye Care and Related Activities.

Risk and Concerns

1. Competitors

There are large numbers of private practitioners in ophthalmology with their own ophthalmic diagnosis and treatment equipment. There are a few with small hospitals with more advanced equipments.Apart from these there are large ophthalmic hospitals both philanthropic and run as commercial business entities.

Your company can counter this challenge by providing focused eye care delivery and by deploying the state of the art equipments backed by panel of expert doctors.

2. COVID 19

COVID 19 came into the country in January 2019. In the last week of the financial year 2019-2020 the government announced total lock out. This affected our attendance and revenue of FY 2019-2020 for the last one week of 2019-20.

Even though the impact of COVID 19 is very minimal on the financial year 19-20, it has a very major impact on 20-21.When you read this report of financial year 2019-2020 you cannot but expect the company to spell out its strategy to tackle COVID 19.COVID 19 is affecting us significantly reducing the patient attendance to 50% and revenue to 60% of same months of 2019-2020

This is to some extent due to travel restrictions. To an extent it is also possibly due to patients reluctance to come to an eye hospital, lest they can get infected. We expect the travel restrictions to come down with time. We have already introduced many measures to make our own centers COVID 19 free. We are taking still more stringent steps to ensure COVID 19 spread free treatment in all our centers.

This will make patients to come to our centers with confidence.

3. Profitable and Proficient optimal use of Latest Technologies and Trends.

The biggest task of any organization is to harness the technological advancement taking place at every nanosecond and cultivate the same in such a manner that produces profitability for the organization and maximizes the shareholders wealth simultaneously.

We are aware of this and plan to improve.

4. Health Status Issues

The difference between rural and urban indicators of health status and the wide interstate disparity in health status are well known. Clearly the urban rural differentials are substantial and clearly impact the spending power and in turn the variety of high end options made available to them.

We plan to organize our centers with this fact in mind.

Future of Ophthalmology

Future of ophthalmology health care is very bright •Occurrence of cataract has not come down •Diabetes is increasing •Hypertension is increasing

•There is no major change in the mindset of young people they, would like to be lens free The following will be our future plans

a. Implementing innovative modes to generate revenues

b. COVID free treatment

c. Efficient analysis of future requirements

d. Insistence on latest and cutting edge technology at all hospitals.

Our Edge

Our edge lies in our investment in modern equipment, and excellent experienced consultants in all our centers, presence in many districts and COVID free, personal care.

Internal control systems and their adequacy

Your company has established internal control systems to ensure optimum use in protecting its resources and ensuring adherence to its policies, procedures and statutes. There is proper and adequate system of internal control for the company and its branches. The company has appointed Internal Auditor to review the adequacy of the internal control systems, procedures and policies. The internal auditor evaluates the adequacy of the internal control systems by testing the control mechanism and gives their recommendations to the management.

Discussion on financial performance with respect to operational performance

Financial performance with respect to operational performance has been dealt with in the Directors Report which should be treated as forming part of this Management Discussion and Analysis Report.

Material developments in Human Resources / Industrial Relations front, including number of people employed

There were 322 numbers of permanent employees on the rolls of the Company as on 31.03.2020. During the year under review your company enjoyed cordial relationship with the employees at all levels.

Cautionary Statement

The Management Discussion and Analysis Report contains forward looking statements based upon the data available with the Company, assumptions with regard to global economic conditions, the government policies etc. Actual results might differ materially from those either expressed or implied.

For and on behalf of the Board
Place : Coimbatore
Date : 31st Aug, 2020 (Sd.) Sangeetha Sundaramoorthy
Whole -time Director