Your Directors have pleasure in presenting the management discussion and analysis
report for the year ended on March 31, 2023.
GLOBAL ECONOMIC OVERVIEW
Global economy continues to gradually recover from the pandemic and Russias invasion
of Ukraine. According to International Monetary Fund (IMF), Economic activity in the first
quarter of the year proved resilient, despite the challenging environment, amid
surprisingly strong labor markets. Energy and food prices have come down sharply from
their war-induced peaks, allowing global inflation pressures to ease faster than expected.
And financial instability following the March banking turmoil remains contained thanks to
forceful action by the US and Swiss authorities. According to IMF, growth will slow from
last years 3.5 percent to 3 percent this year and next, a 0.2 percentage points upgrade
for 2023 from our April projections. Global inflation is projected to decline from 8.7
percent last year to 6.8 percent this year, a 0.2 percentage point downward revision, and
5.2 percent in 2024.
The longer than expected conflict between Ukraine and Russia, which started in February
2022, is expected to weaken the economic recovery, apart from creating one of the largest
humanitarian tragedies. The recent resolution of the US debt ceiling standoff and, earlier
this year, strong action by authorities to contain turbulence in US and Swiss banking
reduced the immediate risks of financial sector turmoil. This moderated adverse risks to
the outlook. However, the balance of risks to global growth remains tilted to the
downside. Inflation could remain high and even rise if further shocks occur, including
those from an intensification of the war in Ukraine and extreme weather-related events,
triggering more restrictive monetary policy. This conflict has also pushed up the price of
crude oil and commodities, disrupted the supply of agri-inputs and food, and aggravated
the inflationary environment across the world. Food security has become a priority for
national governments worldwide which is leading to higher demand for quality agri-inputs.
Global inflation is expected to moderate next year but it will likely remain above
inflation targets in many economies.The report also offers fresh insights on how the wars
effects on energy markets are clouding the global growth outlook. The war in Ukraine has
led to a surge in prices across a wide range of energy-related commodities. Higher energy
prices will lower real incomes, raise production costs, tighten financial conditions, and
constrain macroeconomic policy especially in energy-importing countries.
INDIAN ECONOMY
Despite global volatility, the Indian economy grew by 6.8% in 2022 – making it the
fifth largest economy globally in terms of nominal GDP (US dollars). This growth has been
supported by reduction in Covid-19 cases leading to opening Indias large domestic economy
coupled with the governments enormous public spending, both in the form of planned
outlays and direct benefit transfers, led to liquidity infusion into the economy, and
helped the country consistently grow. Indias inflation trajectory is expected to be
significantly impacted by extreme weather conditions like heat waves and the potential for
an El Ni?o year, volatility in international commodity prices and the possibility of a
pass-through of input costs to output prices.
The capital expenditure for FY 2022-23 stands at 2.9% of GDP, indicating the
Governments commitment to investing in the countrys growth. Moreover, the Government has
announced an even larger allocation of 10 lakh crore for the next fiscal year, which
demonstrates their long-term vision for the economy. Of this amount, a considerable sum of
1.78 lakh crore has been earmarked for the Ministry of Chemicals and Fertilisers,
reflecting the Governments emphasis on promoting the chemical and agriculture sectors.
Overall, these budgetary allocations signal the Governments determination to accelerate
economic growth and create a more prosperous and resilient India. (Source: Budget 2023,
RBI, Economic Survey 22-23, Ministry of Finance)
Headwinds to growth are faced by all countries mainly because of global situation (the
Ukraine war, supply chain disruptions and consequently rising commodity prices), there are
multiple challenges. One is the tightening that is happening in the central banks in the
developed world other is the possibility of commodity prices going up.
INDUSTRY OVERVIEW
In 2022, the market is growing at a steady rate and with the rising adoption of
strategies by key players, the market is expected to rise over projected horizon. The
Global Modular Kitchen market is anticipated to rise at a considerable rate during the
forecast period, between 2023 2030. The market growth can be attributed to growing
construction and remodeling demand by the consumers toward modular kitchens Growing
demands for chimneys and clear environment in the kitchen further drive the growth of the
Indian Kitchen Hoods Market in upcoming five years.
We believe that our growth in other states in the country can fetch us new business
expansion and opportunities. Presently, our presence is in the few states of India. Going
forward we intend to establish our presence in more locations in the country. Our emphasis
is on scaling up of our operations in other markets which will provide us with attractive
opportunities to grow our client base and revenue.
Threats
• 3 Rise in cost of material and cost of transportation may affect the margin
• 3 Changes in Government Policies
• 3 Intense competition may reduce profitability
• 3 Act of God
• 3 Client Dissatisfaction
• 3 Customers inability to pay
SEGMENT-WISE PERFORMANCE
The Companys main business activity is manufacturing of Modular Kitchen& Wardrobe
Storage Accessories.
OUTLOOK
Indias economy recovered quickly from the pandemic and further growth is expected to
be supported by solid domestic demand and increase in capital investments. The
International Monetary Fund (IMF) estimate real GDP growth of 5.9 for 2023. The
agriculture sector has been growing at an average annual rate of 4.6% over the past six
years, and the industrial sector is estimated to grow at 4.5% in FY 2022-23. The services
sector saw quick recovery in 2022, growing 8.4% Y-o-Y, and continued to grow in 2023.The
Company continues to explore the possibilities of expansion and will make the necessary
investments when attractive opportunities arise.
Indian government has accelerated its reforms initiatives like Production Linked
Incentives (PLI) schemes and increased infrastructure spending to support the industry.
This will provide resilient demand in economy and its ripple effect on other aspects of
the economy, such as employment and productivity, will bring India back on track in its
medium- to long-term economic objective.
RISK & CONCERNS
The Company has in place a mechanism to identify, assess, monitor and mitigate various
risks to key business objectives. Key business risks and mitigation strategy are
highlighted below.
Business Risk
To mitigate the risk of high dependence on any one business for revenues, the Company
has adopted a strategy of launching new products/services, globalising its operations and
diversifying into different business segments. The strategy has yielded good results and
the Company therefore has a diversified stream of revenues. To address the risk of
dependence on a few large clients, the Company has also actively sought to diversify its
client base.
Legal & Statutory Risk
The Company has no material litigation in relation to contractual obligations pending
against it in any court in India or abroad. The Company Secretary, compliance and legal
functions advise the Company on issues relating to compliance with law and to pre-empt
violations of the same. The Company Secretary submits a quarterly report to the Board on
the Companys initiatives to comply with the laws of various jurisdictions. The Company
also seeks independent legal advice wherever necessary.
Human Resource Attrition Risk
Maruti Interior Products Limited(Formerly Known as Maruti Interior Products Private
Limited)key assets are its employees. In a highly competitive market, it is a challenge to
address the attrition. Maruti Interior Products Limited(Formerly Known as Maruti Interior
Products Private Limited) continues to accord top priority to manage employee attrition by
talent retention efforts and offering a competitive salary and growth path for talented
individuals.
Macroeconomic Risks
Companys business may be affected by changes in Government policy, taxation,
intensifying competition and uncertainty around economic developments in Indian and
overseas market in which the Company operates.
Mitigation Strategy
The Company has well defined conservative internal norms for its Business. The Company
ensures a favourable debt/equity ratio, moderate liquidity, strong clientele with timely
payment track record, appropriate due diligence before bidding and focus on expanding
presence in newer markets to minimize the impact in adverse conditions. The Company has
geographically and operationally diversified into multiple countries and business segments
thereby reducing its dependency on one country or market.
Operational Risks
The Companys operations and financial condition could be adversely affected if it is
unable to successfully implement its growth strategies. Competition from others, or
changes in the products or processes of the Companys customers, should reduce market
prices and demanding for the Companys products, thereby reducing its cash flow and
profitability. Product liabilities claims may adversely affect the Companys operations
and finance.
Mitigation Strategy
The Company does strict monitoring of prices and adopts appropriate strategies to
tackle such adverse situations. The Company also adopts technological innovations to bring
about operational efficiency in continuous basis to remain competitive.
Others
The Company is exposed to risks & fluctuations of foreign exchange rates,
raw-material prices and overseas investments exposures.
AUDIT AND INTERNAL CONTROL SYSTEM
One of the key requirements of the Companies Act, 2013 is that companies should have
adequate Internal Financial Controls (IFC) and that such controls should operate
effectively. Internal Financial Controls means the policies and procedures adopted by the
Company for ensuring orderly and efficient conduct of its business, including adherence to
Companys policies, safeguarding of its assets, prevention and detection of frauds and
errors, accuracy and completeness of the accounting records, and timely preparation of
reliable financial information. Your Company process of assessment ensures that not only
does adequate controls exist, but it can also be evidenced by unambiguous documentation.
The process involves scoping and planning to identify and map significant accounts and
processes based on materiality. Thereafter, risk is identified and their associated
controls are mapped, else remediation is implemented. These controls are tested to assess
operating effectiveness. The auditor performs independent testing of controls. The
Auditors Report is required to comment on whether the Company has adequate IFC system in
place and such controls are operating effectively. Your Companys Internal Control System
is robust and well established. It includes documented rules and guidelines for conducting
business. The environment and controls are periodically monitored through procedures/
processes set by the management, covering critical and important areas. These controls are
periodically reviewed and updated to reflect the changes in the business and environment.
RAW MATERIAL PRICES
The prices of basic major raw materials used in our manufacturing process viz.
stainless steel scrap /flats of various grades doesnt affect much, as we are working in
open market scenario.
FINANCIAL PERFORMANCE
During the year under review on the basis of Standalone and Consolidated Financial
Statement the Companys total revenue from operations during the financial year ended 31STMarch,
2022 were Rs. 3790.10 Lacs as aginstRs.2797.08 Lacs of the previous year.. The company has
achieved Net Profit of Rs.405.92 Lacs as aginst Rs.298.51 Lacs of the previous year.
MATERIAL DEVELOPMENTS IN HR / INDUSTRIAL RELATION / NUMBER OF PERSON EMPLOYED
Our Company believes that the human capital is key to bring in progress. The Company
believes in maintaining cordial relation with its employees, which is one of the key
pillars of the Companys business. The Companys HR policies and practices are built on
core values of Integrity, Passion, Speed, and Commitment. The Companys focus is on
recruitment of good talent and retention of the talent pool. The Company is hopeful and
confident of achieving the same to be able to deliver results and value for our
shareholders. As on 31STMarch, 2023, the total employees on the Companys rolls
stood at 111.
ACCOUNTING POLICIES
The accounting policies have been consistently applied by the Company and are
consistent with those used in the previous year. The financial statements have been
prepared under the historical cost convention on an accrual basis. The management accepts
responsibility for the integrity and objectivity of the financial statements, as well as
for the various estimates and judgment used therein.
DISCLOSURE OF ACCOUNTING TREATMENT IN PREPARATION OF FINANCIAL STATEMENT
The Company has followed all relevant Accounting Standards laid down by the Institute
of Chartered Accountants of India (ICAI) while preparing Financial Statements.
DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE
IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS
The Company has identified the following ratios as key financial ratios:
| Sr. No. Particulars |
|
2021-22 |
Changes |
| 1. Debtors Turnover |
7.66 |
8.50 |
-9.88 |
| 2. Interest Coverage |
0.05 |
0.05 |
- |
| Ratio |
|
|
|
| 3. Current Ratio |
3.63 |
4.13 |
-12.30 |
| 4. Debt Equity Ratio |
0.28 |
0.26 |
7.11 |
CAUTIONERY STATEMENT
Statements in this report on Management Discussion and Analysis describing the
Companys objectives, projections, estimates, expectations or predictions may be
"forward-looking statements" within the meaning of applicable securities laws
and regulations. Actual results could differ materially from those expressed or implied.
| For, Regd. Office: -Plot No 13 Survey No 236 Krishna |
By Order of the Board |
| Ind Estate, Veraval,Tal.KotdaSangani Veraval-360024, |
For, MARUTI INTERIOR PRODUCTS LIMITED |
| Tel: - +91- 2827 253895 |
(Formerly Knowns as Maruti Interior Products |
| Website: www.spitzebyeveryday.com |
Private Limited) |
| CIN:L36998GJ1997PLC031719 |
|
|
Paresh PurushotamLunagaria |
PurshotamRudabhaiLunagaria |
| Place: Veraval |
Chairman & Managing Director |
Executive Director |
| Date: September 04, 2023 |
DIN: 00320470 |
DIN: 00328145 |
+91-9892691696
