Statements in this Report, particularly those which relate to Management Discussion and Analysis, describing the Companys objectives, projections, estimates and expectations may constitute ‘forward looking statements within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied. Some important factors that could influence the Companys operations include the effects of demand & supply conditions affecting the selling prices of our products, raw material availability and prices, future changes in government policies & regulations, tax laws, economic conditions within the country and various other factors.
A. INDUSTRY OUTLOOK
The global beauty market, particularly in brick-and-mortar channels, faced significant challenges in the past two years, particularly due to the global COVID-19 pandemic. The sector is growing through digital channels. Globally around 25% of sales of beauty products are online but more importantly, the development of online sales has changed the potential market reach of brands that once were considered as selective.
B. DEVELOPMENTS IN THE COMPANY DURING THE CURRENT YEAR
There is no new category of products launched during the year. However, The NEW PRODUCTS launched in the previous year as well as our existing range was completely revamped and positioned in terms of their look and feel, imagery, packaging and presentation of the product, extremely superior quality of materials for products and packs as well as improving the application solution provided through the packs. The response received from the customers is quite encouraging and the products are highly appreciated.
C. FINANCIAL PERFORMANCE
1) Sales and Other Income
The Sales and other income of your Company for the year was Rs. 2691.98 lakhs as against Rs. 2474.52 lakhs in the previous year, showing an increase of 8.79% over the previous year.
2) Material Cost
The material cost for the year was Rs. 580.44 lakhs as against Rs. 740.17 lakhs in the previous year. The material cost is decreased by 21.58%
3) Employment Cost
The expenses pertaining to employment costs in FY 2022-23 was Rs. 488.47 Lakhs as against Rs 573.78 lakhs in previous year. This is decreased by 14.87%.
4) Finance Cost
The interest and Finance charges paid has increased to Rs. 169.79 lakhs in the current year as against Rs. 235.37 Lakhs in the previous year.
5) Depreciation
The depreciation for the year was Rs.80.75 Lakhs as against Rs. 95.19 lakhs in the previous year.
6) Profit Before Tax
Profit before tax (PBT) stood at Rs. 21.18 Lakhs as against Rs. 33.47 lakhs showing a decrease of 3.53%.
7) Profit/(Loss) After Tax
Profit after tax (PAT) was Rs. 21.18 Lakhs as against profit of Rs. 19.57 lakhs in the previous year.
D. OPPORTUNITIES
The Beauty and Personal Care industry is categorized into five segments body care, hair care, face care, hand care and color cosmetics. The Indian beauty and personal care market is expected to exhibit a CAGR of 6.5% during 2022-2027. Despite of COVID-19 pandemic the cosmetics industry growth has not been decreased and is expected to grow more in the coming years. The usage of social media has increased in an unprecedented way and allows access to reach individuals locally and globally and is giving the company an opportunity to sale the products both online and offline.
Looking at the current market the company is thinking of expanding into more products with new innovative ideas in skin care, body care, health care, beauty care, high end color cosmetics products. The company is also thinking of expanding sales and distribution in more number of towns in the coming 3 years which can lead to a good expansion of the company.
E. THREATS
Although the Company has a long history of achievements and existence to its credit, one of the threat to the industry is a huge competition in the market. Social media has added benefit and complexity in equal measure, with users sharing their experiences, reviews and advice about products with thousands of others at the click of a button. This can be great for exposure if the review is positive, but if not, product sales can really suffer. The other threat is from the spurious products dumped in the market by the unorganized sector. This could result in fake and low-quality products being available in the market, thus hampering our sales. Some of the other constraints to our brands are the ever changing consumer behavior, lots of other brand choices available in the market, entry of foreign competitors which has created a stiff and intense competitive situation.
F. OUTLOOK
Cosmetics industry has emerged as one industry holding huge potential for future growth. It is contributing to the economic growth of the country. During the last three to four decades, the industry has gained momentum and shall continue to do so in the coming years. Your Company will continue to concentrate on both product development and broadening of customer base. This will help the Company to increase the stakeholder value, growth in volumes along with managing the margins through competitive pricing. Continued cost efficiency and cost savings coupled with infrastructure development will be the focus for the coming years.
G. RISKS AND CONCERNS
The Company believes that an organization cannot be risk averse but has to persistently foresee and implement ways of mitigating these risks. The Company occasionally faces the risk of an economic downturn but looking at the growth prospects for the Cosmetics Industry, this risk can be controlled, if not mitigated. In order to ensure long term corporate sustainability and success it is essential that the Company accept these risks, place proper mechanisms and find solutions to reduce as well as mitigate these risks. We have an active risk management strategy in place to identify potential risks, create mitigation strategies and monitor the occurrence of risk. Thus, the Company is well aware of these risks and challenges and has put in place mechanisms to mitigate the same.
H. INTERNAL CONTROL SYSTEMS
The Company has an Internal Audit and control system, manned and managed by qualified and experienced people. Companys internal control systems are well commensurate with the nature of its business and the size and complexity of its operations. These systems were designed foreseeing the nature of activities carried out at various locations and the various business operations. These control systems are routinely tested and cover all the offices, factories and key areas of business. Significant audit observations and follow up actions thereon are reported to the Audit Committee. Audit Committee reviews the adequacy and effectiveness of the Companys internal control and monitors the implementation of audit recommendations including those relating to strengthening of the Companys systems and procedures.
I. HUMAN RESOURCES
The Company had 52 employees on rolls as on 31st March 2023.
For and on behalf of the Board of Directors Paramount Cosmetics (India) Limited
Sd/- | Sd/- |
Hiitesh Topiiwaalla | Vishwajeet Nalinkant Mehta |
Managing Director | Director |
DIN: 01603345 | DIN: 02800993 |
Place: Bangalore | Place: Bangalore |
Date: 04.09.2023 | Date: 04.09.2023 |
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www.indiainfoline.com is part of the IIFL Group, a leading financial services player and a diversified NBFC. The site provides comprehensive and real time information on Indian corporates, sectors, financial markets and economy. On the site we feature industry and political leaders, entrepreneurs, and trend setters. The research, personal finance and market tutorial sections are widely followed by students, academia, corporates and investors among others.
Copyright © IIFL Securities Ltd. All rights Reserved.
Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213, IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248
This certificate demonstrates that IIFL as an organization has defined and put in place best-practice information security processes.