Photon Capital Advisors Ltd Management Discussions

MANAGMENT DISCUSSION AND ANALYSIS:

Industry structure and developments:

Except some regulatory changes made by the RBI, there have been no substantial changes in the NBFC industry as a whole.

Opportunities and threats:

The stock market remains in a risky zone. Government securities offer some possibilities. Your company is in a cautious stance and is not in a hurry to act.

Segment-wise or product-wise performance:

Since the Company does not operate in multiple sectors/segments, the segment wise performances of the financials are not applicable.

Outlook:

The near term outlook remains cloudy because of various measures that the government has taken to improve overall functioning of the economy. However, in the long term, given favourable demographics and under penetration of various sectors, the investment outlook remains very bright. Excessive valuations in pubic markets are also a matter of concern.

Risks and concerns:

Your Company has continued to minimize risks from external factors and has constantly preferred and adopted methods and systems in its economic activities with low element of risk. In the current and future years, your company will further strengthen and bolster its efforts to minimize or negate all risk factors. However, external factors of foreign currencies and impact of global slowdown, currency corrections of other large growing economies do cause concern to all enterprises and your company does consider this as a concern. Nevertheless, such factors will be dealt with caution and adequate foresight.

Internal financial control systems and their adequacy:

The Company has an Internal Control System commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit (IA) function is defined in the Internal Audit Charter. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

Material developments in Human Resources/Industrial Relations front, including number of people employed:

No major changes in employees recruitment during the financial year under review. The company has not made significant development in human resources.