Paos Industries Ltd Management Discussions

While it has been the practice of the Company to regularly share with Members the developments/information on the Company and the Industry Front. However, this section and format is being offered as part of the Annual Report. The companys Joint Venture namely PAOS Productions has started its operation in first quarter of financial year 2020-2021. The company is a partner in the said firm with 20% profit/loss sharing ratio at the end of year. The said entity is engaged into manufacturing of soaps and detergents. A lot of inventions are under way in the Joint Venture and the new products & SKUs are being added therein and the company is expected to achieve better results through its Joint Venture.

OPPORTUNITIES AND STRENGTH

India is a country with growing population and here the household penetration of soaps is 99%. People belonging to different income levels use different brands, which fall under different segments, but all income levels use soaps, making it the second largest category in India. Rural consumers in India constitute 70% of the population. Rural demand is growing, with more and more soap brands being launched. Thus the soap industry has signs of healthy growth ahead. The promoters of the company had a strong standing of more than 60 years in the business of Soaps & Detergents manufacturing and has the ability to face any kind of challenges in the said business.

THREATS

There is lot of competition in the market and popular imported and Indian brands and continuous increases in raw material prices and other costs are main threats. Further there can be risks inherent in meeting unforeseen situation which too are not uncommon in the industry.

RISK AND MANAGEMENT PERCEPTION

The operations of Joint Venture Project may be subject to general business risks and competition in the industry, which can affect the growth of the company. Your company continuously updates its systems and procedures to reduce uncertainties and risks and explore new market to cope with the competition.

OVERVIEW

Financial Statements of the Company have been prepared in compliance with the requirements of the Companies Act, 2013 and Ind-AS. The management of the Company accepts responsibility for the integrity and objectivity of these financial statements, as well as various estimates and judgments used therein. The estimates and judgments relating to financial statements have been made on a prudent and reasonable basis so that financial statements reflect in a true and fair manner, the form and substance of transactions and reasonably present the companys state of affairs and profit/loss for the year. The predictions and future estimates in any statements given in this report are based on current environment. However, many unforeseen and uncontrollable external factors may alter these predictions.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has proper and adequate internal control systems to ensure that all financial transactions are authorized and recorded correctly. There are no operation(s)/ transaction(s) during the year. This system ensures that all assets of the Company are properly protected against loss and put to authorized use only. However to pay off bank liabilities and the company pursuant to approval of members had disposed off its assets. The Audit Committee meets at regular intervals to review audit observations and implementation of corrective actions and submit reports of its observations to the Board of Directors.

HUMAN RESOURCES/INDUSTRIAL RELATIONS

The relations of Company remained very cordial with staff and other concerned during the year under review but it is very unfortunate that there is no workforce in the company.

OUTLOOK

The company may be viable with the start of Joint Venture Project in the name of PAOS Productions andis expected to have better future in time to come by operating through the Joint Venture.

CAUTIONARY STATEMENT

Statement in the Management Discussion and Analysis describing Company objectives, expectations, projections, estimates may be "forward looking statements" within the meaning of applicable laws and regulations. Actual position and circumstances may differ. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent developments, information or events.