Mafia Trends Management Discussions


1. INDUSTRY STRUCTURE AND DEVLOPEMENT:

The Retail Industry Market had a value of US$ 21,237.64 billion in 2022 and is estimated to grow at a CAGR of 7.69% from 2023 to 2030, reaching US$ 41,368.44 billion by 2030. The markets growth can be attributed to the increase in consumer spending in emerging economies, which is a major driving factor. The pandemic-induced rise in online shopping trends has also contributed to market growth. Furthermore, the increasing penetration of smart phones worldwide is generating more traffic on e-commerce websites, which is expected to drive market growth during the forecast period.

Source: https://www.verifiedmarketresearch.com/product/retailindustry-market.

The Indian Fashion industry is poised for significant growth in the coming years, with revenue projected to react US$ 19.86 billion by 2023. This growth is expected to continue at a CAGR of 13.35% from 2023-2027, resulting in a projected market volume of US$ 32.79 billion by 2027.

China is the biggest contributor to this market, with a projected market volume of US$ 336.80 billion by 2023. The number of users in the Fashion segment is expected to reach 528.70 million by 2027, with user penetration projected to increase from 25.5% in 2023 to 35.7% in 2027. The Average Revenue Per User (ARPU) is expected to be US$ 54.61, indicating a significant potential for revenue growth in the industry. With the rise of digitalisation and the increasing preference for online shopping, the fashion industry is poised for further growth in the coming years. However, companies will need to adapt to changing consumer preferences and find ways to stand out in a crowded market to capitalise on this growth opportunity.

2. OPPORTUNITIES AND OUTLOOK:

Inflation trends, central bank actions, and Russias war in Ukraine are likely to shape FY24s economic growth. Global GDP is expected to grow by 2.8% in FY 2022-23 and 3.0% in FY 2023-24, led by developing economies. However, advanced economies like the US and Euro zone may experience a significant slowdown and brief recessions. Interest rates are likely to remain high due to continued inflationary pressures.

Source:https://www.imf.org/en/Publications/WEOIssues/2023/04/11/world-economic-

outlook-april-2023.

Despite facing global challenges, Indias economy has proven to be resilient and is positioned to surpass all major economies in growth rate, securing the top spot for the fastest-growing major economy worldwide. The economic survey forecasts a GDP growth rate of 6.5% in FY 2024-25, building on the countrys already impressive growth trajectory.

Source: Economic Survey of India, 2022-2023.

The e-commerce market in India has experienced significant growth and diversification over the past two decades. The market is expected to reach US$ 350 billion in GMV and have around 500 million online shoppers by 2030, reflecting the increasing penetration of internet and smart phones in the country. Furthermore, the Indian e-commerce market is unique in that it is heavily driven by the sale of fashion and lifestyle products, unlike other markets in the region where electronic products are the primary driver. One of the key factors driving the growth of the Indian e-commerce market is the convenience and ease of online shopping, which has made it a popular choice among consumers, particularly in the metros and Tier I cities. Additionally, the growth of Indias digital economy is expected to touch US$ 800 billion by 2030, reflecting the countrys transformation from a bottom-of the-pyramid economy to a truly middle-class-led economy, with consumer spending estimated to reach nearly US$ 6 trillion by the same year. The emergence of UPI as a significant player in all digital payments, accounting for around 62 billion transactions in 2022, is also a significant driver of growth in the Indian e-commerce market. Sources:

https://www.investindia.gov.in/sector/retail-e-commerce

https://www.indianretailer.com/article/technology-e-commerce/digital-trends/emergence-Indian-e-commerce-market-and-retail-trend

3. RISK. CONCERNS AND THREATS:

The transition from conventional business methods to online modes has facilitated customers in accessing global designs conveniently. Consequently, new platforms are emerging rapidly, and the industry is gradually embracing them.

Inadequate Availability of Skilled Workforce

The retail industry faces a shortage of proficient workforce, leading to a high turnover rate. However, we have managed to maintain lower attrition rates than the industry standard through our talent management programme. This programme has enabled us to develop a pool of managers and leaders who will steer our future growth. Additionally, we have strengthened our management team by hiring experts in crucial domains such as e-commerce, marketing, and supply chain.

4. INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY:

The Company ensures the safety and protection of its assets by having implemented well defined policies and their implementation in a well efficient manner. The board of the Company is always well informed regarding the operations of the company. The company always ensures the dissemination of information through proper channels in a professional manner. The management takes regular recommendations and advises from the reliable professionals having experience in their fields, in order to efficiently discharge responsibilities by giving hands on facts, details and recommendations concerning the activities covered for audit and reviewed by it during the year. The conclusions of internal audit reports and effectiveness of internal control measures is reviewed by top management and audit committee of the Company.

5.

FINANCIAL PERFORMANCE:

A. Standalone Financial Performance:

(i) Revenue from Operations and Other Income:

Revenue from operations for the year ended on 31st March 2023 and 31st March, 2022 is Rs. 768.34 Lakhs and Rs. 715.28 Lakhs.

(ii) Expenditure:

The total expenditure in for the year ended on 31st March 2023 and 31st March, 2022 is Rs. 738.84 Lakhs and Rs. 609.70 Lakhs.

B. Profit before Tax:

The profit before tax of the company for the year ended on 31st March 2023 and 31st March, 2022 is Rs. 31.82 lakhs and 106.01 lakhs.

(iii) Profit after tax:

The profit after tax/net profit of the company in for the year ended on 31st March 2023 and 31st March, 2022 is Rs. 20.56 Lakhs and Rs. 74.31 Lakhs.

6. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE:

The Company is engaged solely into the business of trading of apparels and readymade garments. Therefore, its performance pertaining to the said segment is mentioned above in the Para 5 as Financial Performance.

7. DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS

Sr. No. Ratios

Is change any significant change compared to last year Justification

1 Debtors Turnover Ratio

Yes The Company has managed to recover collections from customers in a stipulated credit period.

2 Inventory Turnover Ratio

No Not required as the change is within the limits

3 Interest Coverage Ratio

Yes The EBIDTA of the company has been decreased.

4 Current Ratio

Yes It is improved due to decrease in trade payables and increase in short term loans & advances to vendors

5 Debt Equity Ratio

Yes The variation is due to decrease in long-term borrowing and companys reserves are increased and company is enjoying higher surplus profit.

6 Operating Profit Margin

Yes The operating expenses of the company has been increased and the operating income of the company is not increased in equal proportion to the operating income.

7 Net Profit Margin

Yes There is a major variation as compared to previous year because the Companys gross profit margin decrease by around 8%.

8. DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF:

The return on net worth of the company for the financial year 2021-2022 is approximately 21.58 % and 2.84% in the current year. This major change is due to increase in the owners fund of the company because the company has came up with the Initial Public Offer of the equity shares during the year only.

9. DEVELOPMENT IN HUMAN RESOURCES

The Company considers its employees as its main assets. The management believes in the philosophy of the development of the Company with the development of its employees. Proper environment of work, all necessities and their safety is looked after. The well-being of its employees is always a priority to the company. The employees are given proper guidance and training to execute their tasks. Hence, higher degree of work satisfaction is enjoyed by the employees of the company.

10. ENVIRONMENT, HEALTH & SAFETY (EHS)

The Company commits to ethical and sustainable operation in all business activities. Company maintains and implements an Environmental Management System (EMS) for meeting the purpose of organizations policy and objectives regarding environment. The aims of the system is use of processes, practices, techniques, materials, products, services or energy to avoid, reduce or control the creation, emission or discharge of any type of pollutant or waste, in order to reduce adverse environmental impacts. Adequate Occupational Health & Safety Management System is adopted by the Company for ensuring the conformance to the Occupational Health & Safety Management

System, legal & statutory requirements, continual improvement and satisfaction of interested parties (i.e. customers, suppliers, employees and public).

11. CAUTIONARY STATEMENT:

No reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions, predictions etc. may constitute "forward looking statements" contained herein. Certain statements contained in this document may be statements of future expectations, forecasts and other forward-looking statements that are based on managements current view and assumptions. Such statements are by their nature subject to significant uncertainties and contingencies and the actual results, performance or events may differ materially from those expressed or implied in such statements. Readers are cautioned not to place undue reliance on any forward-looking statement.

Date: September 05, 2023

Place: Ahmedabad FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

Sd/-

Rajendra Rajpurohit Managing Director & CFO DIN:07684092

Sd/-

Mahendra Singh Wholetime Director DIN:07684132