PVV Infra Ltd Management Discussions.
Industry Structure and Development:
The company is involved in the Infrastructure Business of cost effective construction solution for Multi-stored Building Approved by State and Central Government. India has a requirement of investment worth Rs.50 Trillion (US$ 777.3 billion) in infrastructure by 2022 to have sustainable development in the country. Initiative like Housing for all and Smart City Mission will direct the growth of the sector. The Government of India has announced and given a massive push to the infrastructure sector by allocating Rs 4.56 lakh crore (US$ 63.20 billion) for the sector in 2019-20 union budget. With a view of development of infrastructure 100 percent FDI is permitted through the automatic route in the sector. On international front, there are promising opportunities in Sri Lanka, Bangladesh, the GCC and Africa. The GCC countries are continuing to invest in infrastructure. Saudi Arabia s development plan worth USD 53 bn (SAR200 bn), which is in line with the goals of Vision 2030, gives an optimistic outlook for business in this region.
Outlook, Opportunities and Threats and Risks and Concerns:
India s GDP in FY2019 is estimated to have grown by around 7 per cent. While this is a laudable achievement in the global context, it falls marginally short of expectations due to interplay of macro-economic and political factors. These include the uncertainties which invariably accompany our General Elections, volatility in crude prices and unpredictable currency fluctuations. The economy also had to grapple with a funding crunch for NBFC s precipitated by the IL&FS debt default, deceleration in the agriculture and the Company continues to explore the possibilities of expansion and will make necessary investments when attractive opportunities arise. The Indian financial sector has growth potential. There is a significant growth opportunity for the Company in changing economic scenario. The overall growth is expected to firm up on policies supporting investment, but is expected to remain below trend. The Company is making its best efforts to realize maximum from its customers. Market conditions, in particular the performance of equity markets, contribute substantially to the Company s growth.
The Government s continued focus on affordable housing and infrastructure development is expected to drive growth. The Government has provided infrastructure status to affordable housing. The relaxation in GST will help the sector to steadily improve in FY 2019-20.
The liquidity crunch has been prevailing in the real estate market for over a year, and many developers are financially stressed. The Regulatory compliance by developers to arrange loans for projects is becoming stringent and therefore there has been a delay in financial tie-ups by developers. To avoid any liquidity risk, robust screening of customer profiles and their liquidity position is undertaken before bidding for any construction contract as well as during execution.
Internal Control and their Adequacy:
The company has an adequate system of internal controls commensurate with the size and nature of business. The company is complying with all the mandatory requirements of Corporate Governance as laid down in the Listing Agreement. This has improved the management of the affairs of the company and strengthened transparency and accountability. The Audit Committee reviews the internal control system and look into the observations of the statutory auditor very closely.
Discussions on Financial performance:
The financial performance of the Company for the year has been discussed in the Director s Report and Cash Flow Statement annexed with the Annual Accounts.
The Company has potential appraisal systems for identifying and developing talent of Employees. The Company is confident of attracting, developing and nurturing the best talent in the industry in view of the company s inherent strengths gained over the years. As in the past, the Company has enjoyed cordial relations with the employees at all levels.
Statements in the Management Discussion and Analysis describing the company s present position, objectives, expectations or predictions may be "forward looking" statements within the meaning of applicable laws and regulations.
|For and on behalf of the Board|
|PVV Infra Limited|
|Place: Vijayawada||JATIN JASVANTLAL SHAH|
|Date: 30.08.2019||Executive Director cum CEO|