Mohit Paper Mills Ltd Management Discussions.

The Board of Directors presents hereunder an analysis of performance of the Company for the year 20182019 and its outlook for the future. This outlook is based on current business environment which may vary due to future economic and other developments.

Industry Structure

The Indian Economy is estimated to have an increased growth rate with China. The agricultural and allied sector has recovered from decline in previous years. Lot of emphasis has been given by this Government on inclusive development with greater emphasis on development of Agriculture and Education Sector. This shall boost the Paper Industry.

The Industry is been recovering and getting along with the new GST regime and Demonetization done by the Government

GDP Growth rate is expected to be at 8%, growth in consumption of paper is expected to be at 8%.

At present the paper industry is facing crucial face, due to abnormal rise in cost of raw-materials, chemicals, consumables and power. The Prices of the Paper have shown improvement than previous years.

To be globally more competitive Indian paper industry needs the following:

-Sustained availability of good quality of raw material (forest based) and bulk import of waste paper to supplement the raw materials supplies.

-Adequate modernization of the manufacturing facilities.

-Improvement of Infrastructure

-Quality Improvements and reduction in cost of production.

-Import policy conductive for import of material, equipment, raw-materials and technology.

Opportunities

The potential of growth for the industry lies in development of the economy, rising literacy rates, consumerism and standard of living. All these factors are in a positive move in India at present, which gives a good picture to the scenario of paper industry.

With the increased focus on education and agriculture, the future of Indian Paper Industry looks good.

During the Year your Company have shown improvements in their Sales volume and Profit. It is under process of installation of Cholrine Di Oxide Plant by which the quality of the paper is likely to be improved and will be able to fetch good market position with better prices.

The Production of Poster Paper which was started in later part of the previous year has been running good.

Threats

The main cause of fall in the profitability of many Indian paper manufacturers can be attributed to the fall in rupee value, increased cost of raw material, fuel consumables etc.

Outlook

Measures of improvement for the paper industry:

1. Strong R& D for improving technology & automation.

2. Energy and Water should be used in a judicious way.

3. Effluent Standards should be improved by adopting green technologies.

4. Social Forestry methods should be used for improving the shortages in raw-material.

5. Specialized training should be imparted to enhance the skills and knowledge of man-power.

Performance

During the year Sales and other income have increased from 102.69 crores to 157.99 crores. Net Profit before tax increased from 138.81 Lakhs to 295.11 Lakhs. Consolidated Production have increased from 21,918.78 M.T. to 30,791.97 M.T.

During the year the company has achieved the optimum level of capacity utilization with respect to the manufacture of the writing printing and poster paper and it has been done due to the expertise of the Managing Director and the Technical staff. This is a good example of maximum utilization of the capacity with minimum of the resources.

There are no reportable Segments other than Paper (Writing and Printing and Poster Paper) internal Control System and Their Adequacy

Your Company possesses a good internal control system to ensure that all the assets are safe guarded and protected against the unauthorized use or disposition and that transactions are authorized recorded and reported correctly.

The Audit Committee of the Board of Directors review the internal control system and their adequacy from time to time.

Discussion of Financial Performance with respect to operational performance

The Financial Statements have been prepared in accordance with the requirements of the Companies Act, 2013 and applicable Indian Accounting Standards issued by the Institute of Chartered Accountants of India. The Management of Mohit Paper Mills Limited accepts the integrity and objectivity of these financial statements as well as the various estimates and judgments used therein. The Statement has been made on prudent basis and reflects in a true and fair manner.

Highlights for the year are as follows. र in Lakhs
Particulars For the year ended 31.03.2019 For the year ended 31.03.2018
Sales & Other Income 15749.26 10269.06
Profit before Interest, Depreciation and Tax 961.50 784.50

Human Resources/ Industrial Relations

Human resource is the best resource of all the resources because it is the one which can properly take advantage of the other resources.

It is the companies belief that Human Resources is the driving force towards progress and success of the company. The Company seek to motivate and retain its professionals by offering reasonable compensation and opportunity to grow in the organization. The total permanent employees strength of the company was 169 on 31st March, 2019. Industrial relations remain cordial during the year.

Cautionary Statement

Statements in the management discussion and analysis describing the Companies objectives, projections, estimates, expectations may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results may differ from those expressed and implied. Important matters that effects the companys performance is the economic conditions of demand and supply and price conditions in the domestic and overseas market in which the Company operates, changes in the government regulations, tax laws and other statutes and other incidental factors.