Rajasthan Tube Manufacturing Co Ltd Management Discussions

a) INDUSTRY STRUCTURE & DEVELOPMENT:

Activities of your company come under the category of steel tube industry. With the increased activity in housing and agriculture, the future of the steel tube industry shall continue to remain encouraging.

Presently major requirements of pipes in rajasthan are being met through units situated outside rajasthan. The pipes manufactured by the company would be able to compete effectively in the market as they would have a clear price advantage over the other outside suppliers because of lower transportation cost benefits applicable to the company. The companys product shall enjoy purchase preference in all govt. & semi govt. Organizations of rajasthan govt. Steel tube and pipe industry is expected to show good prospects in view of increased availability of h.r. coils being basic raw material to manufacture m.s. steel tube. More units with similar facility may come up resulting in greater competition and lower price realization. Changed state govt. Policies may affect the profitability of the company. The steel tube industry is subject to market cycle and as constituent of the industry, your company is also exposed to these constituents. Rise in price of h.r. coils is also a matter of concern.

c) SEGMENT:

The operations of the company are covered in one segment only i.e., steel tube segment.

d) OUTLOOK:

Having regards to the prevailing circumstances your company visualizes a hopeful growth in the industry.

Your company maintains an internal control system in different areas like purchases, billing for the jobs etc. Moreover, there are internal auditors who make consistent monitoring to have proper and sufficient care for maintenance of adequate accounting records required for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

Your board has nothing to report on the development in human resource as well industrial relations front which have a material bearing on the business of the company.

Your board has not received any disclosure by the management relating to any material, financial and commercial transactions where any of the managerial staff has personal interest that may have a potential conflict with the interest of the company at large.