options chain Management discussions

a) Industry Structure and Development:

During the current year there was a good crop of raw jute and the price of raw jute was stable during the whole year. This has benefited the Industry as a whole. Demand for Jute products was good during the whole year, as Government procurement of jute bags was satisfactory. Demand of jute products in International market suffered during the year as demand from overseas market was very poor. There was sharp increase in wage costs due to increase in D. A. during the whole year.

b) Opportunities and threats Opportunities:

Government of India continue 100% reservation norms for packing of food grains with jute bags. Thus creating good demand for jute bags.

Jute being a natural bio-degradable fibre is environment friendly and use of Jute goods in different areas like Jute Geotextiles and / Floor Covering is being promoted. Some diversified products are being developed in the Industry for export markets such as shopping bags.

Threats:

i) Govt, attempt for Dilution of compulsory packaging under JPMA will lead to affect the future plans. Food grain packing is shifting to plastic which will be big threat.

ii) Farmers are reluctant to take up jute crop as new generation of workers are interested in alternate opportunities.

iii) Shortage of workers is causing obstruction in optimization of capacity utilization.

iv) Global economy crisis may affect overseas market for jute industry.

c) Segment wise or product wise performance:

The Company is mainly engaged in the business of Manufacturing of Jute Goods and hence segment wise performance is not required to be disclosed.

The following disclosure under Geographical segment has, however, been considered on the basis of sales for the Jute goods:

- Within India-Rs. 29420.56 Lakh (previous year Rs. 21839.57 Lakh)

- Outside India - Rs. NIL (previous year Rs. NIL lakh)

d) Outlook:

Your company has performed satisfactorily despite increase in wages cost as well as other costs. Current year seems to be challenging and the company is optimistic on the future outlook.

RISKS AND CONCERN:

The major areas of risk and concern for the Jute Industry:

i) Availability of Raw Jute: The jute crop fluctuate heavily due to Monsoon rains and any shortage of crop create cost escalation and poor availability.

ii) Shortage of Workers: Shortage of workers all over the Industry is a matter of concern.

iii) Revenue Concern: The Jute Industry is mostly dependent on Government procurement orders for packaging of food grains where the Revenue is very low.

iv) Alternate packaging Material: Availability of alternate packaging material at cheaper rate is a matter of concern.

e) Internal control systems and their adequacy:

Your company has an adequate system of internal control, which provides reasonable assurance with regard to safeguarding the companys assets, promoting operational efficiency and ensuring compliance with various statutory provisions. The Audit Committee of the Board plays a significant role in the internal control system and reviews the scope of internal audit work and internal Audit reports, financial performance of the company and suggests improvements in the internal control systems wherever required.

f) Discussion on financial performance with respect to operational performance:

Sale of Jute goods during the year was Rs. 29420.56 lakhs as compared to Rs.21839.57 lakhs during previous year. Operating loss for the year was Rs.549.14 lakhs as compared to loss of Rs.730.31 lakhs in the previous year.

g) Material developments in Human Resources/lndustrial Relations front, including number of people employed:

Employment of workers at new pay scale and training programs for the workers are being continued. Steps have been taken to provide residential quarters within the mill compound for outside workers as well. The company is making all efforts to train the workers and increase their skills by way of continuous training but Industry wide shortage of workers is a matter of great concern for all.

The relations with the unions were cordial during the year.

There were 4038 permanent employees on the rolls of Company as on March 31,2023.

h) Cautionary statement:

Statement made in this section of the report is based on the prevailing position in the Jute industry and market conditions. Actual results could however differ materially from those expressed or implied with regard to Companys Outlook and Performance.