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.

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. This system ensures that all assets of the Company are properly protected against loss and put
to authorized use only. 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 has commenced its business operations after acquiring the business from M/s National Soap Mills
through a Business Transfer Agreement. Pursuant to this acquisition, the Company has restarted and is now actively
carrying on business operations. The Management is confident and hopes to deliver better results and capture
emerging market opportunities to further expand the business in the near future.

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.