Mid India Industries Ltd Management Discussions.

INDUSTRY STRUCTURE AND DEVELOPMENT

The textile industry has voiced alarm over the consistent fall in cotton yarn exports in the last three months due to sharp decline in demand in importing countries. Considering the large-scale investment in the spinning sector and sluggish demand in the domestic markets, this may lead to closure of several spinning units in the near future

OPPORTUNITIES AND THREATS

Due to huge accumulated losses company has stopped manufacturing process and leased out Factory, Plant & Machinery of the Company for the purpose of generation of Revenue owing to market situation and uncertain cash flows from the business. However, Company is planning diversify its business activity & enter into Real Estate business.

INDUSTRYOUTLOOK

India Ratings has maintained a stable outlook for the textile sector for 2019-20 following strong domestic demand, waning impact of the disruptions due to GST and demonetisation and rising exports aided by a weak rupee.

RISKS AND CONCERNS

India continues to experience headwinds in the form of intense competitive pressures from nations having a cost advantage over India, which seem to be constraining the overall momentum of the export sector of India. Steps taken by the Government of India to address the challenges, will remain crucial for a broad-based recovery across the sector.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The companys internal control/supervisory system is established to ensure that the board and management are able to achieve their business objectives in a prudent manner, safeguarding the interest of companys shareholders and other stakeholders whilst minimizing the key risk such as fraud, misleading financial statements, breach of legal and contractual obligations, unauthorized business activities.

HUMAN RESOURCES

Your Company follows a strategy of attracting and retaining the best talent and keep employees engaged, motivated and innovative. The Company continues to have cordial relations with its employees and provide personnel development opportunities for all round exposure to them. As on 31st March, 2019, Company had five employees.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

Financial and Operational performance forms part of the Annual Report and is presented elsewhere in the report.

DETAILS OF SIGNIFICANT CHANGES IN THE KEY RATIOS

As per the amendment made under Schedule V to the Listing Regulations read with Regulation 34(3) of the Listing Regulations, details key financial ratios and any changes in return on net worth of the Company are given below:

Particulars 2018-19 2017-18 Change
Debtors turnover 0.11 0.13 -16.19%
Inventory turnover 0.05 0.10 -46.40%
Interest coverage ratio 0.00 0.00 0.00
Current ratio 0.28 0.53 -46.79%
Debt-Equity ratio 0.15 0.19 -21.60%
Operating profit margin (%) -0.12 -0.19 -36.22%
Net profit margin (%) or sector-specific equivalent ratio as applicable -0.12 -0.19 -0.36

Reason for change of 25% or more in Financial Ratios:

Inventory turnover: Company had sold out whole inventory; thus inventory was Nil on 31.03.2019. Hence, Change of -46.40% is reflected in Inventory Turnover.

Current Ratio: Due to Nil Inventory, Change of -46.90% has been reflected.

DETAILS OF CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR:

There is Change of -106.82% in Return of Net Worth as compared to previous Financial Year Due to Accumlated Losses as a result of which Net worth of the Company has become Negative

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis Report describing the Companys objectives, expectations or predictions may be forward looking within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied. Important factors that could influence the Companys operations include competition, government policies and regulations.