megri soft ltd share price Management discussions

Management Discussion and Analysis Report, as stipulated under Regulation 34 (2) ( e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, forms part of this Annual Report.

^ Overview

Megri Soft Limited (also referred to as "the Company") is a leading provider of comprehensive web products and solutions for iPhone and Android, cloud applications, CMS development, domain investments, paid search advertising work, web design, hosting, development, programming, web software, mobile and web applications, SEO, PPC, social media and internet marketing outsourcing Company. As more and more people start to use the World Wide Web or the Internet, the businesses of web-based services and websites are growing. However, the key to success in this space remains attracting as many customers for web development and digital marketing. With the advent of newer technologies and widespread penetration of communication channels like smartphones and tablet PCs in India, businesses in the web-based industry are on the rise.

During the year under review, the Company has been carrying on dotcom and information technology business, Domain Registration, Web Hosting, Web Designing, Web Development, Web Scripting, Web Based Software Development, Web Promotion, Search Engine Optimization, Link Building and SEO services in addition to development of its own Indian and International Web Portals/Vortals on various subjects as well as provided IT/ITES services to the clients also.

>- Industry Structure and Development

The Internet industry has spawned an emerging dot-com sector and is largely responsible for its high-powered growth. The strong software sector is now playing parent to the nascent dot com brigade, providing newbies with an edge over competitors. The dotcom companies have added a repertoire of skills by including e-business and e-commerce solutions and expertise which is currently the hottest and most in-demand both overseas and in the domestic markets.

The Government, too, is playing the indulgent patron. The Government of Indias decision to increase Internet bandwidth will enable Internet penetration to rise, which will help expand the dot-com business and increase the overall efficiency of the Internet export business industry.

>- Opportunities and Threats

The Company has a lot of scope for increasing its IT export business in the coming times. It has growth in sales because of having the technology edge it has in comparison with other competitor firms and in the international business sector. The Company is already taking steps to increase web apps and mobile development work, which is trending.

The Company has a vast pool of English-speaking and skilled manpower, which rates high on qualifications, capabilities, and quality of work and work ethics which will help the Company grow and expand in the coming times.

The Company?s unique geographical location enables a 24x7 service offering and a reduction in turnaround time due to time zone differences, thereby giving its clients the best, which will ultimately increase the Companys business and performance. Our motto of manpower is providing services with proficiency and efficiency.

With the increase in the dotcom business, more and more firms are opting into this field which will increase the competition in the market regarding cost and pricing. But the Company has competed with a number of foreign firms as well as domestic competition in the past and is very confident of facing future competition as well as emerging as a winner.

Because of the software business sector opening up and increasing work pressure of project deadlines, there is a lot of pressure on people and salaries. The Company has a good track record of employee retention; therefore, it could maintain the quality of the employees in the future as well. The Company being in the IT sector, has risks of Data Security, Attrition, Content Liability, IPR Protect, Obsolescence and Competition Risk.

^ Outlook

The Company has been increasing Search Engine Optimization and IT-related services in the United Kingdom (UK) for the past few years. Considering the fact, the Company has incorporated a wholly owned subsidiary in London, United Kingdom to expand its business in coming years.

>- Risk Concerns

The Company has a well-structured and robust risk management mechanism, which includes a comprehensive register that lists the identified risks, its impact and the mitigation strategy.

>- Discussion on Financial Performance

The financial statements have been prepared in compliance with the Companies Act 2013 requirements and guidelines issued by the Securities and Exchange Board of India (SEBI) and Indian Accounting Standards (Ind-AS) in India. The Management of the Company accepts responsibility for the integrity and objectivity of these financial statements and various estimates and judgments used therein. The estimates and judgments relating to the financial statements have been made on a prudent and reasonable basis so that the financial statements reflect in a true and fair manner the form and substance of transactions and reasonably present our state of affairs, profits and cash flows for the year.

The Company is adequately funded to take care of its current growth plans through the funds generated by its operations. The financial performance of the Company reflects its position in the industry. Being an industry leader with its core business of SEO, the Company is increasing its revenues contributing to higher profits in the past few years.

>- Material Development in Human Resources and Environment

The Companys track record in terms of people retention is very good. To effectively meet the Company?s future challenges, plans have been drawn up, and they are being executed to equip the human resources accordingly. Therefore, the Company is adequately prepared for any risk in this business. The business of the Company is non-polluting. People are the key differentiators for business success today. Ensuring the right skills and behaviours at all organisational levels is paramount at Megrisoft.

>- Internal Financial Control

The Companys internal financial control systems are commensurate with the size and nature of its operations, and such internal financial controls are adequate and are operating effectively. The Company has adopted policies and procedures for ensuring orderly and efficient business conduct.

These controls have been designed to provide reasonable assurance regarding recording and providing reliable financial and operational information, adherence to the Companys policies, safeguarding of assets from unauthorised use and prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The internal control is supplemented by an extensive programme of internal audits, review by management and the Audit Committee, and documented policies, guidelines and procedures. The internal control is designed to ensure that financial and other records are reliable for preparing financial information and other data and maintaining asset accountability.

>- Forward Looking Statement

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates, and expectations may be forward-looking statements within the meaning of applicable laws and regulations. Actual results might differ substantially or materially from those expressed or implied. Important developments that could affect the Companys operations include a downtrend in the Indian online sector, advertising spending, new disruptive technologies or business models, significant changes in India?s political and economic environment, exchange rate fluctuations, tax laws, litigation, labour relations and interest costs.