Oricon Enterprises Ltd Management Discussions

The Management of Oricon Enterprises Limited (“the Company”), presents the analysis of Company for the year ended on March 31,2024 and its outlook for the future. This outlook is based on assessment of current business environment. It may vary due to future economic and other developments both in India and Abroad.

This Management Discussion and Analysis (MD&A) of Oricon Enterprises Limited for the year ended on March 31,2024 contains financial highlights but does not contain the complete financial statements of the Company. It should be read in conjunction with the Companys Audited Financial Statements for the year ended on March 31,2024.

GLOBAL ECONOMY:

In Calendar Year (CY) 2023, the global economy demonstrated remarkable resilience as it steadily recovered from previous uncertainties including disrupted supply chains, increased inflation level, tight monetary policies, geopolitical concerns and subdued global economic activities. The year under review recorded the global economy grew by 3.3%, with emerging market and developing economies (EMDEs) achieving a growth rate of 4.3% while advanced economies grew by 1.6%. Additionally, the inflation level declined from its peak in CY 2022 to 6.8% in CY 2023, primarily driven by rigid monetary policies undertaken by the central banks and subsequent reduction in the commodity prices.

INDIAN ECONOMY:

Despite a sluggish global economy, the Indian economy maintained its position as one of the fastest growing major economies, achieving a growth rate of 8.2% in FY 2024. Additionally, the inflation level was anchored at 5.4%, propelling private consumption. This robust performance can be primarily attributed to strong support from the Indian Government, along with effective and timely measures implemented by the Reserve Bank of India (RBI).

Owing to strategic initiatives by the Government, India has established itself as a favorable business destination. This further facilitated a resilient inflow of foreign direct investment (FDI) at USD 71.0 billion in FY 2024. Moreover, Indias presidency at the G20 summit had further helped the country to attract foreign investors in the reported year.

COMPANY OVERVIEW & PRODUCTS:

1. Packaging

After the Sale of Companys Business of Manufacturing, trading and sale of plastic closures and preforms effective from July 24, 2024 the Company is engaged in the business of Crowns Caps, Pilfer Proof Caps and collapsible tube. The Demand for these products continue to be stagnant and efforts are being made to increase the sale of these products being the only business for packaging. The Company is in process for investing in metal packaging for upgradation of existing facilities specially on the printing facilities.

2. Petrochemicals:

The petrochemicals division is working satisfactorily and during the year under review, the turnover of petrochemicals division was Rs. 56.23 crores. As informed earlier, the Company had entered into Agreement for sale of assets of this division to Narendra Plastochem Private Limited. Information in this respect is provided in Directors Report.

OPPORTUNITIES AND THREATS

Opportunities:

• Proceeds from sale of undertaking(s) will allow the Company to capitalize on continuing the business and to look for new growth opportunities.

Threats:

• Companys operations being labour intensive increase wage demand could affect operations.

• Our Business is subject to seasonality which may contribute to fluctuation in our Financial Condition, Cash Flows, Results and operations.

• Volatility in Commodity Price.

SEGMENT WISE PERFORMANCE:

Your Company has identified segments reporting in terms of IND - AS 108 issued by Institute of Chartered Accountants of India (ICAI). The following are the abridged results of these segments:

Standalone Results:

Segment(s)	Segment Revenue (Rupees in Lakhs)	Segment Results Profit / (Loss) from each segment before interest and tax (Rupees In Lakhs)
Packaging - Continuing Operations	9,644.90	(47.96)
Real Estate	0.00	0.00
Others	351.96	3.40
Discontinuing Operations
Packaging	33,422.63	3756.07
Petrochemical	5,623.91	191.46
Total	49,043.40	3902.97

Consolidated Results:

Segment(s)	Segment Revenue (Rupees in Lakhs)	Segment Results Profit / (Loss) from each segment before interest and tax (Rupees In Lakhs)
Packaging - Continuing Operations	9,644.90	(84.58)
Real Estate	-	-
Others	6,642.42	185.76
Less: Inter Segment Revenue	1,631.82	0.00
Discontinuing Operations
Packaging	33,422.63	3756.07
Petrochemical	5,623.91	191.46
Logistics	-	-
Total	53,702.04	4048.71

Includes Rs.178.57 Lakhs as a exceptional item on account of sale of subsidiary companies namely shakti clearing agency Pvt Ltd & USL Lanka logistics Pvt Ltd.

Analytical Ratio

For Analytical Ratio please refer note no. 67 of the notes to standalone financial statements.

Details of significant changes (25% or more as compared to previous year) in key financial ratios are as under:

Key Ratio	2023-24	2022-23	Variance	Reason
Debt Service Coverage Ratio	2.57	0.66	287.76	Due to reduction in debt service.
Return on Equity Ratio	1.23	1.92	(35.92)	Due to decrease in profit
Net Profit Ratio	2.32	3.19	(27.04)	Due to decrease in profit
Return on Capital Employed	2.11	3.12	(32.13)	Due to decrease in Earnings Before Interest & Tax

RISKS AND CONCERNS:

To sustain and grow in global market brings in uncertainties. Greater the uncertainties, higher the risk.

The Company has a risk identification and management frame work appropriate to it and to the business environment under which it operates. Risks are being identified at regular intervals by the Board.

The Company has a Risk Management Policy, which provides overall framework of Risk Management in the Company. The Board of Directors is responsible for the assessment, formulation and implementation of guidelines, managing key risks, risk minimization procedures and periodicals review.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

Your Company has a system of internal controls to safeguard the Companys assets against loss from unauthorized use and ensure proper authorization of financial transactions. The Company also has budgetary control system to monitor all expenditures against approved budgets on an ongoing basis. The Company maintains a system of internal controls designed to provide assurance regarding the effectiveness and efficiency of operations, the reliability of financial controls and compliance with applicable laws and regulations as applicable in the various jurisdictions in which the Company operates. The Company has in place adequate internal control systems and procedures covering all the operational, financial, legal, and compliance functions. The structured internal audit process charged with the task of ensuring reliability and accuracy of the accounting and of the other operational data.

The Company has a system of monthly review of businesses as a key operational control wherein the performance of units is reviewed against budgets and corrective actions are taken.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

This has been dealt in Directors Report.

HUMAN RESOURCES / INDUSTRIAL RELATIONS:

The Company has been very proactive to support its entire work force at all the levels in best possible manner. Human resource is considered as key to the future growth strategy of the Company and looks upon to focus its efforts to further align human resource policies, processes and initiatives to meet its business needs.

Industrial relations at all the units and locations are harmonious during the year under review.

CAUTIONARY STATEMENT:

Statements in the Management Discussion and Analysis describing the Companys objectives, expectations or predictions may be forward looking within the meaning of applicable securities, laws and regulations. Important factors that would influence the Companys operations include cost of raw materials, tax laws, interest and power cost, economic developments and such other factors within the country and the international economic and financial developments.