Panth Infinity Management Discussions


This chapter on Managements Discussion and Analysis ("MD&A") is to provide the stakeholders with a greater understanding of the Companys business, the Companys business strategy and performance, as well as how it manages risk and capital.

The following management discussion and analysis is intended to help the reader to understand the results of operation, financial conditions of Panth Infinity Limited.

(1) ECONOMTC OVERVTEW. TNDUSTRY STRUCTURE AND DEVELOPMENTS:

World Economy and Jewellery Tndustry Trends

The global jewelry market size was valued at $216.48 billion in 2022 & is projected to grow from $224.38 billion in 2023 to $308.36 billion by 2030, exhibiting a CAGR of 4.6% during the forecast period.

There is a rising trend in jewel consumption as more people are inclined towards luxurious products. Various positive attributes of the product include assisting in highlighting specific features of the body, showcasing fashion trends/style, helping to enhance looks, and others. The products growing popularity among high-income earners as a symbol of high status is helping to accelerate the consumption rate, Rising demand for contemporary jewels and an increasing number of designers entering the market continue contributing to market growth.

Technology has advanced significantly, especially post-Covid-19, which has positively influenced the ornaments industry, most notably in the design techniques & manufacturing space. The rising popularity of manufacturers incorporating technology with ornaments is helping to boost the consumption of the product.

Due to Significant government support, positive vaccination programs and relaxation in COVID restrictions turned things around and started inducing customers to buy Jewellery for events like wedding and festivals. The jewellery industry has also been helped by a shift in consumer preferences from spending in travel and entertainment to luxury products like Jewellery.

TNDTAN ECONOMY:

Indias gems and jewellery market size was at US$ 78.50 billion in FY21. Growth in exports is mainly due to revived import demand in the export market of the US and the fulfilment of orders received by numerous Indian exhibitors during the Virtual Buyer-Seller Meets (VBSMs) conducted by GJEPC.

Indias gems and jewellery exports reached US$ 39.14 billion in 2021-22, a 54.13% rise from the previous year. From April-December 2022, Indias gems and jewellery exports were at US$ 28.6 billion, a 6.28% rise compared to the previous years period. While the export during April-March 2023 stood at US$ 37.95 billion.

The Company is presently engaged in Business of Trading of Precious Metals, Stones & Jewellery. The Company expects that these businesses will persist in the coming years. The Company is a part of an Industry, which largely operates through unorganized constituents. However, unlike the industry, the Company has attempted to operate through as systematic and organized manner as possible. Since, Diamond and Jewellery is one industry, in which India holds commendable position in the world, one can look forward to more international involvement coming up in this industry.

(2) OPPORTUNITY AND THREATS:

? Opportunities

Diamond and Jewellery volumes in India have remained resilient over the years aided by strong cultural affinity or the yellow metal and stable returns from the asset class. The major growth drivers for the industry are:

> Stable asset class

Gold has historically been one of the most stable assets providing investors best returns over a long-term horizon, compared to other assets.

> An essential part of Indian culture

Jewellery in India has traditionally been an integral part of weddings and festivals. Indian customers often purchase contemporary jewellery as a form of self-expression and this has led to evolution of distinct targeted collections including wedding wear, work wear, regular or daily wear and fashion wear as well as very premium limited edition signature collections.

> Increasing affordability

Rapidly expanding economy, increasing urban per capita income and governments focus to double farmers income by 2022, huge opportunities will open up with increasing affordability of this segment.

> Rising female workforce

Better job opportunities, rising demand for skilled and professional workforce and rapid urbanization are leading to increasing share of women in workforce. And by virtue of women being the primary consumers of jewellery, their increasing entry into workforce and disposable income are likely to drive the demand, going forward.

> E-commerce

With the rising internet penetration in the country, e-commerce is gaining significant boost with rising consumer confidence along with the advantage of ease in shopping, lucrative discounts, access to wider variety, free shipping, and quality assurance. Though, an online sale through online channel is currently miniscule, it is gaining importance facilitating jewellers in reaching out to more customers. Also, easing of travel restrictions will help in participating in trade shows, tap new customers and understand jewellery trends and concepts in a better way.

> Government support

Realizing the sectors potential, the Government has identified it to be a focused area for export promotion. Adopting policies of ‘Make in India and ‘Design in India there is a strong intent to push growth. The Government has also undertaken various measures to promote investments and upgrade technology & skills to promote ‘Brand India in the international market.

More and more benefits and exemptions are likely to come in the way of exports in Special Economic Zones. The Company, having commendable exports and being situated in SEEPZ-SEZ, is likely to receive the advantage of the same.

? Threats

> Fast-changing fashion trends

Diamond and Jewellery, being a vital fashion and lifestyle statement, demands the players to be more agile and responsive to the constantly evolving trends and consumer preferences.

> Regulatory framework

Changes in regulations and stringent compliances may cause temporary blip in sales during the transition period.

> Liquidity crisis

The industry is highly capital intensive in nature with long working capital cycles, since the jewellery conversion from gold typically requires 15 days. Strength of the balance sheet and access to easy credit is often required to facilitate and sustain ease in operations.

(3) OUTLOOK:

The Company has exceeded expectations in the current year inspite of severe impacts of COVID domestically and restricted travel and lockdown conditions in various countries. The company continues to invest in product development, efficient processes and skilled manpower to improve products and services for our customers. We expect to achieve higher growth and market share in the current year keeping in view the evolving geo political situation and macro-economic conditions in India and across the globe.

(4) RTSK AND CONCERNS:

Following can be some of the risks and concerns the Company needs to be wary of:

> The largely unorganized structure of the market can affect the systematic functioning of the Company.

> The major income component of the Company being exports, changes in economies or government policies of the countries to which the Company is exporting may also affect the operations of the Company.

> Geo political tensions and impact of war is seen in fluctuating raw materials prices like gold and diamonds. Also currency rate fluctuations due to this global scenario can impact business.

> There is an increased global outlook of rising interest rates and inflation which can adversely impact wider economy and thus Gems and Jewellery business as well.

> Competition amongst manufacturers and exporters remains a concern for jewellery manufacturing from countries that are lifting COVID travel restrictions recently.

(5) TNTERNAL CONTROL SYSTEM AND THETR ADEQUACY:

The Company has a proper and adequate system of internal controls. This ensures that all transactions are authorized, recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition. In addition, there are operational controls and fraud risk controls, covering the entire spectrum of internal financial controls. An extensive programme of internal audits and management reviews supplements the process of internal financial control framework. Properly documented policies, guidelines and procedures are laid down for this purpose. The internal financial control framework has been designed to ensure that the financial and other records are reliable for preparing financial and other statements and for maintaining accountability of assets.

In addition, the Company has identified and documented the risks and controls for each process that has a relationship to the financial operations and reporting. The Company also has an Audit Committee to interact with the Statutory Auditors, Internal Auditors and Management in dealing with matters within its terms of reference. This Committee mainly deals with accounting matters, financial reporting and internal controls.

(6) DTSCUSSTON ON FTNANCTAL PERFORMANCE WTTH RESPECT TO OPERATIONAL PERFORMANCE :

The Income from Operation of your Company for the year 2022-23 was increased to Rs. 1573.51 lakh as against Rs. 1458.24 lakh of the previous year. As a result, the Companys Net Loss after tax has been Rs. 223.54 lakh for the year 2022-23 as against the Net Profit after tax of Rs. 4.26 lakh of the previous year. Your Directors are hopeful to earn rational profit in the years to come.

(7) HUMAN RESOURCES &INDUSTRTAL RELATIONS:

The Companys human resources philosophy is to establish and build a strong performance and competency driven culture with greater sense of accountability and responsibility. The Company acknowledges that its principal asset is its employees. The expertise of the management team, the professional training provided to the staff, their personal commitment and their spirit of teamwork together enhance the Companys net worth. The total numbers of employees as on 31st March, 2023 were 3 (Three).

The Company considers that its relationship with its employees is vital and ensures that employees feel valued and is endeavoring to create an environment and culture within which every employee can put his best efforts and maximize his contribution. The successful conducted vaccination drive for all employees of the Company is one illustration of the safe and healthy environment Company endeavours to provide to the employees.

The Company ensures that all its employees remain competent through education, skills, training and experience as necessary. The Company has had cordial relations between the management and employees and an atmosphere of harmonious working to achieve the business objectives of the Company throughout the year. The Company is poised to motivate each of its employees to perform to the fullest extent possible and to appropriately reward their excellence.

(8) DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIO:

Sr. Ratios No. FY 2022-23 FY 2021-22 Change in Ratio %
1 Debtors Turnover Ratio (Time) 1.25 1.05 19.00
2 Inventory Turnover Ratio (Time) 25.78 6.84 277.00
3 Interest Coverage ratio (Time) 0.00 2.24 100.00
4 Current Ratio (Time) 135.91 12.55 983.00
5 Debt Equity Ratio (Time) 0.00 0.00 0.00
6 Operating Profit Margin ratio (%) 8.78 1.64 535.37
7 Net Profit Margin Ratio (%) 0.00 0.30 100.00
8 Return on Net Worth (%) 0.00 0.35 100.00

NOTES FOR CHANGE IN RATIOS:

i. Debtors Turnover Ratio increased by 19.00% due to decrease in Debtors of the Company.

ii. Inventory Turnover Ratio increased by 277.00% due to decrease in Inventory of the Company.

iii. Interest Coverage Ratio decreased by 100.00% due to the Company has paid all debt.

iv. Current Ratio increased by 135.91% due to outstanding amount of creditor in FY 2022-23 is reduced from outstanding balance of creditor in FY 2021-22.

v. Debt Equity Ratio decreased by 100.00% due to repayment of debts.

vi. Operating Profit Margin Ratio increased by 535.37% due to lower expenses generated during theyear under review.

vii. Net Profit Margin Ratio decreased by 100% respectively due to the Company doesnt profit.

viii. Return on Net Worth of the Company decreased by 100.00% due to the Company doesnt profit.

(9) CAUTIONARY STATEMENT:

This document contains forward-looking statements about expected future events, financial and operating results of the Company. These forward-looking statements are based on assumptions and the Company does not guarantee the fulfillment of the same. These statements may be subject to risks and uncertainties. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause assumptions, actual future results and events to differ materially from those expressed in the forward-looking statements. Accordingly, this document is subject to the disclaimer and qualified in its entirety by the assumptions, qualifications and risk factors referred to in the managements discussion and analysis of Panth Infinity Limiteds Annual Report, 2022-23.

By order of the Board of Directors
For PANTH INFINITY LIMITED
Place: Ahmedabad SENDHABHAI AMRUTBHAI MAKVANA
Date:05/09/2023 Chairman & Managing Director
DIN:09756503
REGISTERED OFFICE:-
Office No 1816, Block-B, Navratna Corporate Park, Opp. Jayantilal Park, Ambli Bopal Road, Bopal, Daskroi, Ahmedabad-380058.