Mangalam Worldwide Ltd Management Discussions

"ANNEXURE – G"

In terms of the Regulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management of Mangalam Worldwide Limited (MWL) presents its Analysis Report covering the performance and outlook of the Company.

ECONOMIC OVERVIEW:

Global Economy

Global growth is projected to be in line with the April 2024 World Economic Outlook (WEO) forecast, at 3.2 percent in 2024 and 3.3 percent in 2025. Services inflation is holding up progress on disinflation, which is complicating monetary policy normalization. Upside risks to inflation have thus increased, raising the prospect of higher for even longer interest rates, in the context of escalating trade tensions and increased policy uncertainty. The policy mix should thus be sequenced carefully to achieve price stability and replenish diminished buffers. The baseline forecast is for the world economy to continue growing at 3.2 percent during 2024 and 2025, at the same pace as in 2023. A slight acceleration for advanced economies—where growth is expected to rise from 1.6 percent in 2023 to 1.7 percent in 2024 and 1.8 percent in 2025—will be offset by a modest slowdown in emerging market and developing economies from 4.3 percent in 2023 to 4.2 percent in both 2024 and 2025. The forecast for global growth five years from now—at 3.1 percent—is at its lowest in decades. Global inflation is forecast to decline steadily, from 6.8 percent in 2023 to 5.9 percent in 2024 and 4.5 percent in 2025, with advanced economies returning to their inflation targets sooner than emerging market and developing economies. Core inflation is generally projected to decline more gradually. The global economy has been surprisingly resilient, despite significant central bank interest rate hikes to restore price stability.

(Source: www.imf.org)

Indian Economy Outlook

Indias GDP took a big leap on Leap Day in 2024. The countrys remarkable growth rate of 8.4% in the third quarter of the fiscal year 2024 surpassed all expectations, as market analysts had penciled in a slower growth this quarter, between 6.6% and 7.2%. The projected growth for the quarter was between 7.1% and 7.4%. With substantial revisions to the data from the past three quarters of the fiscal year, Indias GDP growth already touched 8.2% year over year (YoY) in these quarters.

The projected growth for this year to a range of 7.6% to 7.8%, up from the previous estimates due to GDP revisions and stronger-than-expected growth in fiscal 2024. However, the growth in the fourth quarter expected to be modest because of uncertainties related to Indias 2024 general elections and modest consumption growth. The expectations for the near-term future remain in line with previous forecasts with a slight change in the forecast range due to a higher base effect in fiscal 2024. It is believed that the GDP growth to be around 6.6% in the next fiscal year (fiscal 2025) and 6.75% in the year after (fiscal 2026), as markets learn to factor in geopolitical uncertainties in their investment and consumption decisions. Real GDP growth climbed to 8.4% YoY in third quarter of the current fiscal year.

(Source: Deloitte Global Economics Research Center)

Global Steel Industry

Steel, taking into account its complexity and variety, is one of the most used products in the world after coal, cement, oil and timber. Steel plays a vital role in the modern world. In addition to being one of the most important materials for building and infrastructure, steel is the enabler of a wide range of manufacturing activities. It also creates opportunities for innovative solutions in other sectors and is indispensable in research and development projects around the world. One of the primary forces behind industrialization has been the use of metals. Steel has traditionally occupied a top spot among metals. Steel production and consumption are frequently seen as measures of a countrys economic development because it is both a raw material and an intermediary product. Therefore, it would not be an exaggeration to argue that the steel sector has always been at the forefront of industrial progress and that it is the foundation of any economy.

According to the World Steel Association, World crude steel production is 155.7 million tonnes (Mt) in April 2024, a 5.0% decrease compared to April 2023. China is the worlds largest producer of steel, accounting for approximately half of global production. The top 10 steel producing countries and their steel production in the world in April 2024 are: China produced 85.9 Mt, India produced 12.1 Mt, Japan produced 7.1 Mt, United States produced 6.7 Mt, Russia estimate produced 6.2 Mt, South Korea produced 5.1 Mt, Germany estimate produced 3.4 Mt, Turkey produced 2.8 Mt, Brazil estimate produced 2.7 Mt, Iran estimate produced 2.7 Mt.

We expect that steel demand in China in 2024 will remain around the level of 2023, as real estate investments continue to decline, but the corresponding steel demand loss will be offset by growth in steel demand coming from infrastructure investments and manufacturing sectors. In 2025 we see China steel demand returning to downtrend with a 1% decline. The EU (and the UK) remains the region currently facing the biggest challenges. The region and in particular its steel using sectors are challenged on a multitude of fronts – geopolitical shifts and uncertainty, high inflation, monetary tightening and partial withdrawal of fiscal support, and still high energy and commodity prices. The forecasted steel demand for the EU in 2024 is only 1.5 Mt higher than the pandemic trough in 2020. US steel demand continues to show healthy steel demand fundamentals.

(Source: World Steel Association)

Indian Steel Industry

Indias steel production is estimated to grow 4-7% to 123-127 MT in FY24. Easy availability of low-cost manpower and presence of abundant iron ore reserves make India competitive in the global set up. India is home to fifth-highest reserves of iron ore in the world.

India has emerged as the strongest driver of steel demand growth since 2021, and Indian steel demand will continue to charge ahead with 8% growth in its steel demand over 2024 and 2025, driven by continued growth in all steel using sectors and especially by continued strong growth in infrastructure investments. In 2025, steel demand in India is projected to be almost 70 million tonnes higher than in 2020.

The Indian steel industry is classified into three categories - major producers, main producers, and secondary producers. India is the worlds second-largest producer of crude steel, with an output of 125.32 MT of crude steel and finished steel production of 121.29 MT in FY23.

Indias finished steel consumption stood at 119.17 MT in FY23 and 112 MT in FY24. The Indian Steel Association (ISA) anticipates that the steel requirement will reach 128.90 MT in the 2023-24 period, showing an increase from 119.90 MT in the preceding year

The steel industry has emerged as a major focus area given the dependence of a diverse range of sectors on its output as India works to become a manufacturing powerhouse through policy initiatives like Make in India. With the industry accounting for about 2% of the nations GDP, India ranks as the worlds second-largest producer of steel and is poised to overtake China as the worlds second-largest consumer of steel. Both the industry and the nations export manufacturing capacity have the potential to help India regain its favourable steel trade balance.

The National Steel Policy, 2017 envisage 300 million tonnes of production capacity by 2030-31. The per capita consumption of steel has increased from 57.6 kgs to 74.1 kgs during the last five years. The government has a fixed objective of increasing rural consumption of steel from the current 19.6 kg/per capita to 38 kg/per capita by 2030-31. As per Indian Steel Association (ISA), steel demand will grow by 7.2% in 2019-20 and 2020-21.

Huge scope for growth is offered by Indias comparatively low per capita steel consumption and the expected rise in consumption due to increased infrastructure construction and the thriving automobile and railways sectors.

In February 2024, the government has implemented various measures to promote self-reliance in the steel industry. Under the Union Budget 2023-24, the government allocated Rs. 70.15 crore (US$ 8.60 million) to the Ministry of Steel.

(Source: iebf.org)

Trend in Indias finished steel production, consumption & Expansion

ICRA expects the operating environment of the domestic steel producers to remain challenging in the next fiscal as the industry navigates through a period of softness in steel prices, elevated input costs, a temporary deceleration in domestic demand growth close to the Union Elections, and a weak external environment. According to the rating agencys latest research note, domestic steel consumption growth is expected to slow down to 7-8% in FY2025 (as against 12-13% in FY2024E), bucking the trend of the previous few years, when the industry experienced the fastest period of growth post the global financial crisis.

On the external environment, steelmakers remain on tenterhooks, with multiple structural headwinds in the Chinese economy leading to the countrys steel exports reaching a seven-year high of 90.3 million tonne (mt) in CY2023 (65.3 mt in CY2022). With most other large steel-consuming hubs globally also facing subpar economic activities in the near term, global steel trade flows have been increasingly redirected to high-growth markets like India. This has had the twin effect of Indias finished steel imports steadily trending up since October 2023, most notably from China and Vietnam, and domestic steel prices parallelly correcting by ~8-10% in H2 FY2024 so far. With export prospects also remaining soft, India is poised to become a net finished steel importer in the current fiscal after a gap of five years. Unless the external environment meaningfully improves from hereon, India could continue to remain a net steel importer in the next fiscal as well.

Steelmakers have been on a capacity expansion spree post Covid, with around 15.3 million tonne per annum (mtpa) being commissioned between FY2021 and FY2023, and another 38.5 mtpa of new steelmaking capacity expected to come onstream between FY2024 and FY2027. This rapid pace of fresh capacity creation has been unparalleled in India. The industry is poised to witness an all-time high addition of 11 mtpa in the current fiscal and an even higher 15.6 mtpa in FY2025. However, such large capacity additions have been adequately counterbalanced with incremental demand, helping shore up the industrys utilisation level to a decadal high of ~88% in FY2024 and an estimated 87% in FY2025.

(Source : ICRA Report )

Export Import Scenario in Indian Steel Industry:

Indias steel exports touched a nine-month high in January 24. During the month of January 24, exports of finished steel increased, whereas imports declined as compared to previous month. In January 24, Indias steel exports surged to 8.5 lakh tonnes, compared to 6.4 lakh tonnes in December 23. Simultaneously, Indias imports of finished steel declined from 9.0 lakh tonnes to 7.7 lakh tonnes during the same period. As a result of this shift, India has become a net exporter of steel after a span of six months.

Global Steel prices have started showing an uptrend since October 23. Indias steel exports are likely to remain supported as Indian mills have resumed offers to the Middle East and Vietnam markets after a pause. However, there is a concern of hike in freight rates post-the Red Sea crisis. Share of China, Korea, Taiwan, Austria and Nepal increased in total steel import of India in January 24 as compared to January 23 while share of Japan and Vietnam declined over this period. Share of Italy, Spain, UK, Portugal and Denmark, increased in total steel export from India in January 24 as compared to January 23 while share of Belgium, Vietnam, UAE, Poland and Nepal declined over this period.

INDIA STEEL PIPES AND STEEL TUBES MARKET-INDUSTRY TRENDS

The Steel Pipes and Steel Tubes Market refers to manufacturing, distribution, and trade of steel pipes and tubes. These products are integral components in various sectors such as construction, oil & gas, water infrastructure, and industrial applications. The market encompasses a wide range of steel pipe and tube types, including seamless, welded, and spiral welded variants, catering to diverse structural and fluid transport needs. Factors influencing the market include economic growth, infrastructure development, and demand from sectors like energy and manufacturing. Industry plays a crucial role in supporting essential infrastructure and economic activities worldwide.

India Steel Pipes and Steel Tubes Market size was estimated at USD 32.88 billion in 2023. During the forecast period between 2024 and 2030, the India Steel Pipes and Steel Tubes Market size is projected to grow at a CAGR of 6.43% reaching a value of USD 37.69 billion by 2030. Prominent drivers of the India Steel Pipes and Steel Tubes Market are the growing demand for oil & gas, the increased need for steel pipes worldwide, the thriving transportation sector, and a resurgence in construction activities following the pandemic. Another significant factor contributing to market expansion is the augmented investments in research and development programs aimed at fortifying production facilities. Also, the India Steel Pipes and Steel Tubes Market attributes its highest market share and revenue to the oil & gas sector. Steel pipes play a pivotal role in the transfer of gas and liquid across various applications, with a predominant usage of low alloy or carbon steel. Factors such as inside diameter, ductility, yield strength, and pressure rating are crucial considerations in selecting pipes for specific purposes, underscoring their importance in diverse industrial applications.

By volume, the India Steel Pipes and Steel Tubes Market size was estimated at 6.98 million tons in 2023. During the forecast period between 2024 and 2030, the India Steel Pipes and Steel Tubes Market size is expected to reach the volume of 7.66 million tons by 2030. The steel pipes and tubes industry holds significant importance within the Indian steel sector, contributing approximately 8% to the countrys overall steel consumption. This industry is bifurcated into two main segments: Electric Resistant Welded (ERW) and Submerged Arc Welded and Seamless (S&S). With a total worth of INR 50,000 crores, the steel pipes and tubes industry is evenly divided between the ERW and S&S segments in terms of value. In volume, the domestic market is distributed 70:30 between these two segments. In CY19, India became the worlds second-largest crude steel producer, surpassing Japan and producing 111.2 million tons (MT) of crude steel. The countrys steel consumption stands at around 100 MT, placing India among the top three steel consumers globally.

• India Steel Pipes and Steel Tubes- Market Drivers of the market

The India steel pipe and steel tubes market have been witnessing robust growth due to infrastructural development, increasing construction activities, and the demand from industries like oil and gas, water distribution, and automotive. Steel pipes and tubes are essential components in these sectors due to their strength, durability, and versatility. The governments initiatives for infrastructure development and the growth of the oil and gas sector are driving the demand for steel pipes and tubes.

• India Steel Pipes and Steel Tubes- Challenges of the Market

The India steel pipe and steel tubes market grapple with challenges related to increasing competition from alternative materials like PVC, HDPE, and other non-metallic pipes used in certain applications. Additionally, the steel industry faces concerns about environmental impact and carbon emissions, leading to a growing emphasis on sustainable and eco-friendly production practices. Furthermore, fluctuations in steel prices, influenced by global market dynamics and raw material costs, can affect the overall profitability of manufacturers. To address these challenges, steel pipe and tube manufacturers must focus on product innovation, sustainable practices, and maintaining cost competitiveness.

• India Steel Pipes and Steel Tubes- Applications:

By application, the India Steel Pipes and Steel Tubes Market is divided into Oil & Gas, Chemicals & Petrochemicals, Automotive & Transportation, Mechanical Engineering, Power Plant, and Construction segments. The oil & gas segment holds the highest share in the India Steel Pipes and Steel Tubes Market by application. It is primarily due to its indispensable role in energy infrastructure. Steel pipes and tubes are vital components for transporting oil & gas efficiently and safely across vast distances. The durability and reliability of steel make it the preferred material in constructing pipelines, ensuring the integrity of the energy supply chain. With Indias burgeoning energy demands, particularly in the oil & gas sector, the substantial reliance on steel pipes underscores their pivotal role, driving the segments dominant market share in the country.

GOVERNMENT INITIATIVES IN STEEL SECTOR:

• Under the Union Budget 2023-24, the government allocated Rs. 70.15 crore (US$ 8.6 million) to the Ministry of Steel.

• Government has approved inclusion of ‘Specialty Steel under the Production Linked Incentive (PLI) Scheme, with a 5-year financial outlay of Rs. 6322 crore to promote the manufacturing of Specialty Steel within the country by attracting capital investment and promote technology up-gradation in the steel sector. On 17.03.2023, Government had signed Memorandum of Understanding (MoU) with 27 companies covering 57 applications for categories under the PLI Scheme.

• The Government of India raised import duty on most steel items twice, each time by 2.5% and imposed measures including anti-dumping and safeguard duties on iron and steel items.

• The Government has formulated the National Steel Policy 2017, which lays down the broad roadmap for encouraging long term growth for the Indian steel industry, both on demand and supply sides, by 2030-31.

• The Ministry of Steel constituted 13 Task Forces with the engagement of industry, academia, think tanks, S&T bodies, different Ministries and other stakeholders to discuss, deliberate and recommend upon different levers of de-carbonization of the steel sector.

• The steel sector has adopted the Best Available Technologies (BAT) available globally, in the modernization & expansions projects.

• The Ministry of Steel has integrated BISAG-Ns capabilities into the PM Gati Shakti National Master Plan, uploading geolocations of more than 2000 steel units to gain insights into steel production facilities. This information will aid in planning railway line extension, inland waterways, highways, ports, and gas pipeline connectivity.

• The Steel Scrap Recycling Policy (SSRP) has been notified in 2019 which provides a framework to facilitate and promote establishment of metal scrapping centres in the country for scientific processing and recycling of ferrous scrap generated from various sources including end of life vehicles (ELVs).

• The Ministry of Steel has introduced Steel Quality Control Order, thereby banning sub-standard/ defective steel products both from domestic & imports to ensure the availability of quality steel to the industry, users and public at large. As per the Order, it is ensured that only quality steel conforming to the relevant BIS standards are made available to the end users.

• After extensive consultations with stakeholders, academia etc, a set of 25 common minimum Safety Guidelines for the Iron & Steel Sector was formulated. These Safety Guidelines are at par with the global standards and are compliant with the requirements of the ILO Code of practice on safety in the Iron & Steel industry.

• Manufacturing of SS Billets & SS Ingots:

Unit-I - Halol is having installed manufacturing capacity of total 66000 MT per annum of Stainless Steel (SS) Billets and SS Ingots of 200 series, 300 series, 400 series, Special steels like 17/4 PH, Duplex and Super duplex Steel.

The SS billets and SS ingots are sold under the brand name ‘Mangalam Saarloh.

• Manufacturing of SS Flat/Round Bars:

Unit-II - Changodar is having installed rolling capacity of 90,000 MT/per annum of Stainless Steel (SS) Flat Bars and Round Bars. 200 series 300 series, 400 series, Special steels like 17/4 PH, Duplex and Super duplex Steel SS Billets and SS Ingots manufactured at Unit-I Halol, is captively used in Unit -II – Changodar for production of Flat bars and Round Bars.

The SS flat bars and SS round bars are sold under the brand name ‘Mangalam Saarloh.

• Manufacturing of Bright Bars and Seamless Pipes and Tubes:

Unit – III and Unit – IV at Kapadvanj are equipped with state of the art machinery to manufacture high value added products such as Bright Bars, Seamless pipes & tubes. The black round bars manufactured at Unit-II, Changodar are sold directly and also captively used in Unit- III & Unit-IV for manufacturing Bright bars, Seamless pipes & tubes High-quality seamless pipes & tubes in Austenitic, Ferritic, Martensitic and super grades like Duplex and Super Duplex and ERW Pipes are sold under the brand name ‘Mangalam Tubicore.

Companys products are used across industries like food and dairy equipment, oil and gas, aerospace and medical devices among others. Finish products of Seamless Pipes & Tubes are used in Oil & Gas, Refinery & Petrochemicals, Dairy Processing Equipment, Power Plants, fertilizers Plants, pharmaceuticals, Automobiles, Nuclear Sector, Breweries, Aerospace and Defense etc.

• Fully integrated Manufacturing facility from Scrap Melting to Seamless Pipes & Tubes:

The Company is using its own products i.e. round bar as raw material for manufacturing of Pipes and Tubes. The billets are casted in steel melting shop of the Company at Halol and thereafter rolled in its rolling mill at Changodar. The Company has piercing facility to manufacture ‘Mother Hollow at Kapadvanj Unit. The Company is using its own product i.e. round bars as raw material for manufacturing of Bright bars. Pipes and Tubes are manufactured from Bright bars.

Fully integrated Manufacturing facility

• Plants Location:

Sr. No.	Plant	Location
1	Unit - I - Halol (Steel Melting Shop)	Plot No. 2348 bearing Survey No. 219 paiki, Chandrapura Taluka, Halol, Dist: Panchmahal, Gujarat.
2.	Unit - II - Changodar (Rolling Mill)	Sub Plot No. 3, "Panchratna Industrial Estate" Survey/ Block No. 375/P, Changodar, Tal: Sanand, Dist: Ahmedabad, Gujarat.
3.	Unit - III - Kapadvanj (Bright Bars) Unit- IV- Kapadvanj (Seamless Pipes & Tubes)	South Side Amalgamated Survey No. 1025/3, Modasa Road, Kapadvanj, Gujarat

FINANCIAL POSITION AND RESULTS OF OPERATIONS:

Our Company has robust growth and improvement in top line and bottom line on Standalone basis in the Current and previous financial years which is explained below:

(Rs. in Lakhs)

PARTICULARS	STANDALONE - FINANCIAL STATEMENTS-YEAR ENDED		CONSOLIDATED - FINANCIAL STATEMENTS-YEAR ENDED
	31st March, 2024	31st March, 2023	31st March, 2024	31st March, 2023
Revenue From Operations	81,810.80	64,448.70	81,810.80	64448.70
Other Income	436.14	204.36	436.14	206.45
Total Revenue	82,246.94	64,653.06	82,247.08	64,655.15
Earnings Before Interest, Depreciation and Amortization Expense and Taxes	4,153.33	2,026.34	4,251.85	2,092.13
Less:- A) Finance Cost	1480.71	336.90	1481.06	337.33
Less:- B) Depreciation and Amortization Expense	640.22	485.48	725.09	542.88
Profit / (Loss) before Exceptional Items/ Extra- Ordinary Items and tax	2,032.40	1,203.96	2,045.70	1,211.92
Add/(Less): Exceptional Items/ Extra-Ordinary Items	-	351.68	-	351.68
Profit / (Loss) after Extra Ordinary Items and before tax	2,032.40	1,555.64	2,045.70	1,563.60
Less: Tax Expense:
A) Current Income Tax	2.07	1.95	2.07	1.95
B) Deferred Tax (Assets)/Liabilities	20.00	(114.84)	(254.02)	(195.92)
Profit / (Loss) After Tax	2,010.33	1,668.53	2,297.65	1,757.57

Note:

1. Previous year figures have been regrouped / re-arranged wherever necessary.

2. These audited standalone & Consolidated financial results for the year ended March 31, 2024 is the first annual Audited standalone & Consolidated financial results after adoption of Indian Accounting Standards ("Ind AS"), voluntarily. Consequently, the standalone & Consolidated financial results for all the periods presented have been prepared in accordance with the recognition and measurement principles as stated therein.

During the year under review, the revenue from operation was increased by 26.94%.

During the year under review, the Standalone Total Revenue of your Company is increased to Rs. 82,246.94 Lakhs for the financial year 2023-24 from Rs. 64,653.06 Lakhs for the previous financial year 2022-23. Further, the Company has earned a standalone Profit Before Tax (PBT) of Rs. 2032.40 Lakhs and standalone Profit After Tax (PAT) of Rs. 2010.33 Lakhs during financial year 2023-24 as compared to standalone Profit Before Tax (PBT) of Rs. 1555.65 Lakhs and standalone Profit After Tax (PAT) of Rs. 1668.53 Lakhs, respectively, in the previous financial year 2022-23.

The Company is engaged in steel manufacturing activities and it is operating in a single business / geographical segment.

FACTORS AFFECTING FUTURE RESULTS OF OPERATIONS:

Our Companys future results of operations could be affected potentially by the following factors:

• Political Stability of the Country.

• World Economy stability.

• Competition from existing players;

• Disruption in supply of Raw Materials and Labour Supply at site.

• Occurrence of Environmental Problems & Uninsured Losses.

• Ability to expand the geographical area of operation.

• Government policy and regulations towards Steel Sector.

• Change in demand and supply of products.

• Transportation cost for procuring raw materials and supply of finish products.

SWOT ANALYSIS: Strength

• The management of the Company has successfully scaled up the business over past few years.

• Long-term trust-based relationships with customers for expansion.

• Measures for cost-effective production and timely order fulfillment.

• Adaptable to diverse industry segments and efficient procurement capabilities.

• Ability to use in-house manufactured stainless steel products for reduced costs.

• Though the cost of iron-ore has been on the rise in recent years, it is still one of the most widely available resources domestically. In addition to that, considering that the production of steel is a capital- and labour-intensive process, labour is also available economically.

• The Company is fully integrated stainless steel manufacturing company with in-house Melting plant, Rolling Mill, Bright Bar manufacturing and seamless & welded pipes manufacturing facility. With its end to end manufacturing prowess, the company provides complete range of products to its customers ranging from Billets, Ingots, Bright bars to Pipes & Tubes.

• Maintaining highest standard of governance helping us to boost the confidence of all the stakeholders.

Weakness

• The prices of the raw material are fluctuating in nature so the Company should keep an eye on the prices and pass on the price change to the customers.

• The Company will have to offer discounts and compete with existing players in the initial period of operations to scale up the volumes.

• All Units are significantly dependent on external power from grid as it doesnt have a captive power plant of its own.

Opportunity

• The automotive industry is forecasted to reach US$ 260-300 billion by 2026. The industry accounts for around 10 per cent of the demand for steel in India. With increasing capacity addition in the automotive industry, demand for SS is expected to be robust.

• Steel as a metal has longevity. For instance, stainless steel used in making cutlery lasts longer than glass. Steel is also low on maintenance. TMT bars used in housing construction projects can stand for years unlike wood or other raw material used.

• Steel and steel products have its uses across multiple industries – shipbuilding, automotive, pharmaceutical, aviation, real estate, energy, home appliances, electronics etc.

• Technology has made buying and selling of steel and steel products easier today. Buyers can buy steel online through reliable steel marketplaces and online websites, in a secure, transparent, and quick manner.

• Various Government initiatives like Production Linked Incentive, National Steel Policy (NSP) 2017, etc. targeting development in steel sector pose a unique opportunity for the Company

Threats

• Any change in Government Polices that may affect the industry performance

• Capital intensive industry with fluctuating raw material and finished goods prices. The input prices and the finished goods prices always move in tandem and thereby, any change in input costs would be transferred to finished products.

• Economic recession/downturn in the country as well as globally may affect the industry as a whole.

• Prospects of steel industry are strongly co-related to economic cycles. Demand for steel is sensitive to trends of particular industries, viz. automotive, construction, infrastructure, and consumer durables, which are the key consumers of steel products. These key user industries in turn depend on various macroeconomic factors, such as consumer confidence, employment rates, interest rates and inflation rates, etc. in the economies in which they sell their products.

• The steel Industry is highly polluting and likely to be subjected to stringent environmental regulations at any point of time.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has robust internal control system and procedures compatible with size and operations. The company has well defined internal control system and policies. The Internal Audit of the Company is done by internal auditor firm that includes professionally qualified accountants, engineers and IT experienced executives. Some elements of the Companys internal control system:

• Preparation and supervision of annual budgets for all operating and service functions

• Making Standard Operating Procedures and guidelines and ensure compliance with same.

• Scope of internal audit and the frequency of audit being decided every year to ensure sufficient coverage of different areas and functions over a reasonable period.

• The audit plan is discussed and approved in Audit Committee

• Internal Audit is conducted regularly during the year and Internal Audit Report is being submitted to audit committee for their review and also for future improvements in the system across the organization.

• The Company is also having well defined delegation of power with authority limits for approving revenue and capex expenditures including approval of non-routine and abnormal items.

• Also, External Auditor is also performing independent testing of Internal Finance Controls over financial reporting which is line with regulatory reporting requirements.

• Internal Auditor is also checking the Internal Financial Controls as part of their Audit scope

The Audit Committee of the Board of Directors comprising of 75% independent Directors, which quarterly reviews the audit plans, significant audit findings, adequacy of internal controls system, compliance with Accounting Standards etc.

ENVIRONMENT SAFETY, HEALTH AND ENERGY CONSERVATION:

The Company is steadfast in commitment to environmental stewardship and sustainability. Despite the challenges posed by external factors, we have remained resolute in our mission to minimize our environmental impact and contribute positively to the planet. Ensuring the safety and health of employees at the workplace remains a paramount focus for the Company. The aim is to maintain the higher standards of safety across factories and workplaces; and ensure that latest best practices are implemented across the business to bring operational efficiencies and save energy.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS:

The Company considers employees as its vital and most valuable assets. Your Company considers manpower as its assets and understands that people have been driving force for growth and expansion of the Company.

As of March 31, 2024, there are 310 permanent employees on the rolls, diligently working and dedicated to the companys goals. Through our Learning and Development initiatives, the Company continues to upskill and reskill our employees for their jobs. The Company is into process of continuous improvements based on feedback and inputs from multiple stakeholders, past experiences and industrys best practices (Recruitment and Selection, Leave & Attendance Management) for giving better employee experiences. The Company will continue to create opportunity and ensure recruitment of diverse candidates without compromising on meritocracy.

INVESTOR RELATIONS AND ENGAGEMENT:

Investor Relations (IR) is playing an increasingly important role in todays volatile world in enabling companies to manage investor expectations. The objectives of Companys investor relations activities are to boost confidence and develop a long-term relationship of trust with stakeholders including Shareholders, Investors & Analysts, through true and fair disclosure of information/explanation, and bilateral communication.

To pursue these objectives at all times, the Company continuously discloses necessary information and conducts various investor relations activities. Engaging closely with the investor community helps the Company to gain investor confidence, thereby enabling it to drive maximum value out of the IR programme. The Company conducted following major activities for Investor Relations and Engagement:

• Conducted results earning calls post announcement of the financial results.

• Organized plant visits for analyst & investors community to enable them to get an insight on the functioning of the plants.

• Investor presentation and the required disclosures are shared with the Stock exchange as well as hosted on the website of your Company.

STAKEHOLDER ENGAGEMENT:

The Companys endeavour is to maintain regular engagement with all its stakeholders to ensure that their concerns are addressed and expectations are met. Dynamic processes are in place within the Company to ensure integration of feedback from various stakeholders such as suppliers, customers, employees, and investors on a routine basis. By trusting employees, partnering with suppliers and dealers, and engaging with local communities, we work towards serving and delighting our customers.

KEY FINANCIAL RATIOS:

Sr. No.	Ratio	Numerator	Denominator	As at 31st March, 2024	As at 31st March, 2023	% Change	Reason for variance
1	Current Ratio (In Times)	Current Assets	Current Liabilities	1.44	1.61	(10.56%)	-
2	Debt- Equity Ratio (In Times)	Debt Consists of Borrowings and Lease Liabilities	Shareholders Equity	0.60	0.66	(9.09%)	-
3	Debt Service Coverage Ratio (In Times)	Earning Available for Debt Service	Total Debt Service	2.80	6.50	(56.92%)	Due to the increase in net profit and depreciation
4	Return On Equity Ratio (In %)	Net Profit After Tax	Average Shareholders Equity	13.37%	19.17%	(30.28%)	Due to the sizeable increase in equity compared to net profit.
5	Inventory Turnover Ratio (In Times)	Cost of Goods Sold	Average Inventory	7.11	12.05	(41.00%)	Due to increase in inventory, due to addition of new products and certain level of raw material required to be maintained for each product.
6	Trade Receivables Turnover Ratio (In Times)	Revenue from Operations	Average Trade Receivable	10.81	19.09	(43.37%)	Due to an increase in inventory, due to the addition of new products and the level of raw materials required to be maintained for each product.
7	Trade Payables Turnover Ratio (In Times)	Purchase	Average Trade Payable	23.49	38.09	(38.33%)	Due to addition of new products in which longer credit period is availed as per market practice.
8	Net Capital Turnover Ratio (In Times)	Revenue from Operations	Net Working Capital	8.94	10.84	(17.53%)	-
9	Net Profit Ratio (In %)	Net Profit	Revenue form Operation	2.46%	2.59%	(5.02%)	-
10	Return On Capital Employed (In %)	Earnings Before Interest and Taxes	Capital Employed	12.39%	7.08%	75.00%	Due to increase in equity and borrowings.
11	Return On Investment (In %)	Income Generated from Investment Funds	Average Invested funds	0.49%	4.79%	(89.77%)	Due to lower income generated

CAUTIONARY STATEMENT:

Statements in this Management Discussion and Analysis contains "Forward Looking Statements" including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to Companys future business developments and economic performance. While these forward-looking statements indicate our assessment and future expectations concerning the development of our business, several risks, uncertainties, and other unknown factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to, general market, macroeconomic, governmental and regulatory trends, movements in currency exchange and interest rates, competitive pressures, technological developments, changes in the financial conditions of third parties dealing with us, legislative developments, and other key factors that could affect our business and financial performance. The Company undertakes no obligation to publicly revise any forward- looking statements to reflect future/ likely events or circumstances.

Date : July 18, 2024	For and on behalf of Board of Directors
Place : Ahmedabad	MANGALAM WORLDWIDE LIMITED
Registered office:	VIPIN PRAKASH MANGAL
102, Mangalam Corporate House,	CHAIRMAN
42, Shrimali Society, Netaji Marg,	DIN: 02825511
Mithakhali, Navrangpura,
Ahmedabad-380 009, Gujarat.