Maruti Interior Products Ltd Management Discussions

ANNEXURE II

Your Directors have pleasure in presenting the management discussion and analysis report for the year ended on March 31, 2024.

GLOBAL ECONOMIC OVERVIEW

Current Global Economic Climate

Slower Growth: The global economy has been experiencing slower growth due to various factors like geopolitical tensions, high inflation, and economic recovery post-pandemic. Emerging markets and developing economies are expected to grow faster than developed markets, but growth is generally moderate.

Inflationary Pressures: High inflation rates, driven by energy prices, supply chain disruptions, and labor shortages, are affecting the cost of raw materials and transportation. Central banks are tightening monetary policies to combat inflation, leading to higher interest rates.

Supply Chain Disruptions: Ongoing challenges in global supply chains, including delays and increased shipping costs, impact the availability of materials and the cost of goods.

INDIAN ECONOMY

GDP Growth: India has been one of the fastest-growing major economies, though growth rates have varied due to global and domestic factors. The Indian economy is expected to stabilize with growth rates around 6-7% in the near term.

Rising Middle Class: The expanding middle class and increasing urbanization are driving consumer demand, particularly for household items. As disposable incomes rise, consumers are more likely to invest in quality kitchen products, including kitchen baskets.

Inflation: India has faced moderate inflation rates, which impact the cost of raw materials like stainless steel, plastic, and other inputs used in kitchen baskets. Its essential to monitor inflation trends as they directly affect production costs and pricing strategies.

Raw Material Costs: The prices of key raw materials like steel, aluminum, and plastic have seen fluctuations due to global supply chain issues and domestic demand-supply mismatches. Keeping an eye on these prices is important for maintaining profit margins.

INDUSTRY OVERVIEW

The Indian kitchen basket manufacturing industry is poised for growth, driven by the expanding modular kitchen market and evolving consumer preferences. While competition is intense, opportunities abound for manufacturers who can innovate, maintain high quality, and leverage emerging trends such as sustainability and digital sales channels.

SWOT ANALYSIS Strengths

Product Range and Variety:

Offering a wide range of kitchen baskets (e.g., stainless steel, plastic, wire, and modular designs) caters to diverse consumer needs.

Established Brand Reputation:

A well-known brand with a history of quality and reliability can command customer loyalty and premium pricing.

Quality Control:

High standards of quality control ensure product durability and customer satisfaction, reducing returns and complaints.

Efficient Manufacturing Processes:

Advanced manufacturing techniques and automation improve production efficiency, reducing costs and increasing profit margins. Distribution Network:

A strong distribution network, including partnerships with major retailers and a robust e-commerce presence, ensures broad market reach.

Weaknesses

Dependence on Raw Material Prices:

Volatility in the prices of raw materials like metal and plastic can significantly affect production costs and profit margins.

Limited Innovation:

If the company focuses mainly on traditional designs, it may struggle to meet the demand for innovative and space-saving kitchen solutions. High Production Costs:

High labor or energy costs may reduce competitiveness, especially against manufacturers in low-cost regions.

Environmental Impact:

If the manufacturing process is not environmentally friendly, it could lead to regulatory challenges and negative consumer perceptions. Overreliance on Key Markets:

Dependence on a few key geographic markets can be risky if economic conditions or consumer preferences change in those regions.

Opportunities

Growing Demand for Sustainable Products:

Increasing consumer interest in eco-friendly products presents an opportunity to innovate with sustainable materials and production methods. Expansion into Emerging Markets:

Urbanization and rising disposable incomes in emerging markets create opportunities for market expansion.

E-commerce Growth:

The continued growth of online shopping allows for direct-to-consumer sales, which can increase margins and customer reach.

Customization and Personalization:

Offering customizable kitchen basket solutions can meet the rising consumer demand for personalized products.

Collaborations and Partnerships:

Forming strategic alliances with designers, retailers, or technology companies can enhance product offerings and market reach.

Threats

Intense Competition:

The kitchen basket market is highly competitive, with many low-cost manufacturers, particularly from Asia, which can drive down prices and profit margins.

Economic Downturns:

Economic recessions or slowdowns in key markets could reduce consumer spending on non-essential goods like kitchen baskets.

Supply Chain Disruptions:

Global supply chain challenges, such as delays or increased costs, can impact the availability of materials and the ability to meet production schedules.

Regulatory Changes:

Changes in environmental regulations could increase production costs, especially if new investments in sustainable practices are required.

Technological Obsolescence:

Rapid technological advancements could render current manufacturing processes or materials obsolete, requiring significant investment to stay competitive.

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 31^st March, 2023 were Rs.3771.06 Lacs as against Rs.3888.64 Lacs of the previous year. The Company has made Net Profit of Rs.342.96 Lacs as against Rs.432.36 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 31^stMarch, 2022, the total employees on the Companys rolls stood at 101.

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	2023-24	2022-23	Changes
1.	Debtors Turnover	5.42	6.71	-19.18
2.	Interest Coverage Ratio	12.91	20.93	-38.29
3.	Current Ratio	2.36	3.69	-36.04
4.	Debt Equity Ratio	0.32	0.27	15.57

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.Kotda Sangani 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 Purushotam Lunagaria	Purshotam Rudabhai Lunagaria
Place: Veraval	Chairman & Managing Director	Executive Director
Date: September 05, 2024	DIN: 00320470	DIN: 00328145