Nexus Surgical and Medicare Ltd Management Discussions.

Overall Review:

Given the impact of the pandemic, FY2021 was expected to be an extremely demanding year. The consensus was that GDP growth in FY2021 would not only be negative but also would constitute the greatest fall in growth since 1979-80.

In fact, the degrowth in GDP was much larger than expected. For April-June 2020, real GDP contracted by a massive 24.4%. India had never recorded a quarter of negative growth since it began issuing such data publicly in 1996. No other large economy shrank so much during the pandemic. In the second quarter, July-September 2020, GDP again contracted by 7.3%. The consensus was that growth in the second half of the fiscal year would be far less than what was needed to erase the effect of the deep recession in the first half.

Thankfully, we began to witness early signs on resumption of economic activity in the second half of the year with several high frequency indicators suggesting that the economy was back on to positive growth. The third quarter (October-December 2020) recorded a GDP growth of 0.4%. And, as mentioned earlier, the second advance estimates of national income for FY2021 released by the CSO indicates a negative GDP growth of 8% for FY2021. Though this was bad enough, the contraction will be far less than earlier thought of and we should see the fourth quarter (January-March 2021) showing relatively robust growth.

Industry Structure and Development:

Commodity markets remained jittery in FY21 due to domestic economic slowdown, concerns on fiscal slippage and geopolitical tensions. Weaknesses in overall economic activity also put pressure on business growth.

Your Company is continuously reviewing the evolving situation in the light of COVID-19 and playing a responsible role in minimizing the adverse impact of the pandemic on its businesses and the stakeholders interests..

Opportunities and Threats:

Company is continuously looking for opportunities of growth in new areas and ventured into some revenue generating services that can boost financial health of the company. As regards threat due to COVID-19 demand of commodities affected badly, also forex volatility could be a major threat.

Segment-wise/Product-wise Performance:

Your Company has only one reporting segment. The revenue for the year was Rs. 374.42 lakhs.

Outlook:

The markets presently are subdued due to COVID-19 and how sooner it will revive is not easy to predict. However, with the industry s increasing preparedness, the evolving opportunities can be better harvested.

Risk and Concern:

Economic downturn in recent month, which could pose a risk, should it not be tamed quickly. The entry permit regime for trade within country should end immediately. The Government should continue its initiative of Ease of Doing Business. During the year your Company under its well planned and defined risk management policy gave attention to all the risk areas. The Board of Directors is apprised of the development in risk management in periodical meetings where the quarterly results are approved.

Internal Control System:

Your Company has a planned internal control system through internal checks and reviews it periodically to strengthen it and safeguard Company s assets. Management Information System is given upmost importance.

Financial Performance w.r.t. Operational Performance:

During the year under review, the Company has earned Total Revenue of Rs. 375.27 lakhs in comparison to Rs. 173.23 lakhs during the previous year. The Company has reported a net profit of Rs. 15.40 in comparison to net loss of Rs. 529.58 lakhs (including Rs. 535.05 lakhs for Exceptional Item) during the previous year.

Safety, Health and Environment:

Your Company as a matter of policy gives greater importance to safety, health and environment and also ensures compliance with applicable legislative requirements.

Human Resources:

Your Company recognizes the importance of Human Resource in achieving its objectives and strategies as human resource plays an important role in the success and growth of Company. Your company gives priority in honing and utilizing their skills through in house training programs.

Key Financial Ratios:

In accordance with the SEBI (Listing Obligations and disclosures Requirements) Regulations 2018 (Amendment) Regulations, 2018, the Company is required to give details of significant changes (change of 25% or more as compared to the immediately previous financial year) in Key sector-specific financial ratios.

Particulars F.Y. 2020-21 F.Y. 2019-20
Inventory turnover Ratio (on the basis of sales)1 N.A. 717.45 Times
Current Ratio2 0.78 Times 0.30 Times
Net Profit Margin (%)3 4.10% 3.15%

 

1 Inventory turnover Ratio improved as a result of better inventory management of Company 2 Current Ratio has improved as a result of better management of current liabilities.

 

3 Net Profit Margin (%) have gone up due to improved business structure of the company.

Cautionary Statement:

The report contains forward looking statements describing expectations, estimates, plans or words with similar meaning. Your Company s actual result may differ from those projected depending on various factor. Your Company cannot guarantee that the assumptions and estimates in the forward looking statements are accurate or will be realized.