parab infra ltd Management discussions

OVERVIEW:

The Company is an infrastructure Company in Mumbai Metropolitan Range (MMR) with current focus on residential and office space development. Our primary focus is to continually strengthen our position to be a premium developer maintaining a reputation for quality and innovation our strong focus is on bringing the best to Indian real estate by having a dedicated ‘innovation cell with the mandate of finding and implementing customer-focused innovation across the organization and forming best in class partnerships and alliances. Our strategy is primarily in MMR.

INDUSTRY:

The Company mainly focuses on Investment Industry and Real Estate Industry. Infrastructure development in India has been going through a very difficult phase. The real estate sector comprises four sub sectors - housing, retail, hospitality and commercial. The growth of this sector is well complemented by the growth of the corporate environment and the demand for office space as well as urban and semi-urban accommodations. The Government of India along with the government of the respective states has taken several initiatives to encourage the development in the sector. With the introduction of Real Estate Regulatory Authority (RERA), the Industry will become more organized and company looks for growth in the sector resulting in business opportunities for the Company as well.

FINANCIAL PERFORMANCE:

The total income of the Company for the year under review was Rs.71,50,037/- as against Rs.1,46,50,147/- achieved during the previous year. Expenditure incurred during the year is Rs.42,23,381/-vis--vis Rs. 71,79,019/-in the previous year and the Company earned a net profit of Rs.19,01,892/- as against profit of Rs. 52,03,628/- in the previous year. At present, our focus is to strengthen our balance sheet and create a long term shareholder value.

OPPORTUNITIES:

The Indian real estate sector is among the fastest growing market in the world. The key factors responsible for such strong growth in Indian real estate sector are favourable demographics, rapid urbanization and constantly rising purchasing power of people. Availability of customer friendly housing finance institutions and banks along with favourable reforms launched by the government in order to attract foreign investment are also major drivers of growth in real estate sector. Currently, the investment trend in Indian real estate sector is marked by significant contributions from Non Resident Indians. Further, demand for space from sectors such as education and healthcare has opened ample opportunities in the real estate sector. As a parallel development, besides FDI, real estate fund are expected to pump money into the real estate sector. Proposed law to reform the unregulated construction industry, enables the future deals more obvious and transparent, in turn it attracts great deal of capital, particularly from the upper and middle income categories.

THREATS:

Real estate sector has not yet been given ‘industry status, despite its size, backward and forward linkages. All the real estate projects have to pass through the government for approval and various other clearances from different government institutions and in India, this process is very slow. Limited institutional funding options are available for real estate projects. Volatility in availability of labour is adversely impacting the meeting of time schedules. Rising input cost impacts final prices and could subdue demand. Changes in lending policies by the banking sector could increase the cost of borrowing. Further, overall global economic slowdown may impact the Indian economy which may bring slowdown in real estate sector as well and Companys plan of expansion may get setback.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Your Company has in place internal control systems and procedures commensurate with the size and nature of its operations. Internal control process which consists of adopting appropriate management systems and its implementation are followed. These are aimed at giving the Audit Committee a reasonable assurance on the reliability of financial reporting and statutory & regulatory compliances, effectiveness and efficiency of your Companys operations. The internal control systems are reviewed periodically and revised to keep in tune with the changing business environment. The Company has also appointed Internal Auditor pursuant to the provisions of Companies Act, 2013 read with relevant rules made thereunder.

DISCLOSURE OF ACCOUNTING TREATMENT:

The Company has followed all relevant Accounting Standards while preparing the financial statements for the financial year 2017-18.

MANAGEMENT OUTLOOK:

With the thrust from the government to the construction industry through various initiatives for revival of infrastructure sector, your company is seeing immense opportunities in its core competency area.

The adaptability to meet the challenges and encash opportunities available through a well business plan along with increased spending in the infrastructure segment in India that will help the company to reap the benefit of the opportunities by evaluating various options for venturing into other infrastructure and maximize shareholders value.

RISKS AND CONCERNS:

Your Company has an elaborate Risk Management procedure, which is based on three pillars: Business Risk Assessment, Operational Controls Assessment and Policy Compliance processes. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The Company has set up a Risk Management Committee to monitor the risks and their mitigating actions and the key risks are also discussed at the Audit Committee. Some of the risks identified by the Risk Management Committee relate to competitive intensity and cost volatility. The Companys internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditor. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems.

HUMAN RESOURCES:

Companys Human Resource agenda remained focused on reinforcing the key thrust areas. The Company believes that employees are our key differentiators and the Human Resource function acts as a strategic enable to help businesses to achieve their objectives. The Company has also focused on building speed and simplification in ways of working. The Company continued to enjoy healthy industrial relation.

FORWARD-LOOKING STATEMENT:

The report contains forward-looking statements, identified by words like ‘plans, ‘believes, ‘projects, and so on. All statements that address expectations or projections about the future but not limited to the Companys strategy for growth. Product development, market position, expenditures and financial results are forward-looking statements. Since these are based on certain assumptions and expectations of future events, Company cannot guarantee that these are accurate or will be realized. The Companys actual results, performance or achievements could thus differ from those projected in any forward-looking statements.

The Company assumes no responsibility to publicly amend, modify and revise any such statements on the basis of subsequent development, information or events.

CAUTIONARY STATEMENT:

Statements in this Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, expectations or predictions may be "forward looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and Indian demand and supply conditions, finished goods prices, input materials availability and prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, tax regimes, economic developments and other factors such as litigation and labour negotiations.

	By order of the Board of Directors
	For Parab Infra Limited
	sd/-
	Neha Botadra
	Company Secretary & Compliance officer
Place: Mumbai	Mem No: A52139
Date: 31.08.2018	PAN: BJLPM8875N