ORGIN AGROSTAR LIMITED
ANNUAL REPORT 2003-2004
MANAGEMENTS DISCUSSION AND ANALYSIS REPORT
a. The main, business of the company is in Starch and Starch based
derivatives sector. This Sector has seen Positive growth during the post
year after overcoming the slackness of earlier years.
b. However unlike other major players, who use maize as the main raw
material, the company is dependent on Tapioca for it feedstock. The prices
and availability of Tapioca is highly fluctuating and hence the company is
constantly under pressure on its production costs.
c. However with the implementation of the Maize crushing project which will
produce Maize Starch, the Company would overcome this major bottleneck and
would be able to sell finished products at competitive prices.
The Company has tremendous opportunities for marketing its products in
South India being strategically located close to the main consuming
industries in the food, pharma and confectionary industries. There has been
substantial growth in these sectors due to entry of new players in the
confectionary business and rapid expansions in pharma business.
With increased production plans in downstream production like Dextrose,
Monohydrate and Maltodextrine and with the Companys ability to manufacture
products of high quality, there is tremendous potential to grow in these
The company also has exported its products to various countries and sees a
good export potential in Russia, Middle East and Far East countries.
With the completion of the Maize processing plant and enhancement of
capacities of products with better margins and there would be an
improvement of Companys performance in the next few years.
Risks and concerns:
The enormous delay in implementation of the critical projects have led to
the substantial fall in the manufacturing operations of the company. The
management is now implementing its plans in right earnest and would come
out with better performance in the next two years.
The statements above represent the view and intentions of the management
and efforts to realize the some are being done in right earnest. The
success depends on various internal and external conditions.
Internal Control System:
Your Company has established an advanced internal control system and manual
in the Purchase, Production and Marketing areas and in line with ERP system
Development in Human Resources:
The Company has an employee strength of 139 as compared to 159 in the
previous Accounting Period. The difference is due to the right sizing of
the various departments to achieve better deployment and improving
performance. The Company has cordial relations with the workers union.
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