rama vision ltd Management discussions

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis as required under Regulation 34 of SEBI (LODR) Regulations, 2015 read with Schedule V of the said Regulations, forms part of this Boards Report as follows :

Overview of Industry Structure and Development

In 2022-23, World Economy had faced high uncertainty due to the continued impact of adverse events of the last three years, notably the COVID-19 pandemic and Russian war. Inflation rates have skyrocketed to multi-decade highs in many countries, causing central banks to raise interest rates and slow down economic activity to bring inflation back to their targets. In early 2023, the world economy had started showing signs of stabilizing after the adverse shocks of the previous year, but this progress was disrupted by recent financial sector disturbances. Some financial institutions that relied heavily on low interest rates have been caught off guard by the rapid pace of rate increases, causing financial stress and raising concerns about stability. This had a significant impact on FMCG consumption as consumer tried to manage their household budgets by adjusting volumes and prioritising essentials over discretionary categories. The impact of slowdown was more pronounced in rural markets. Urban Markets led growth for FMCG supported by normalisation in economic activities after a couple of years of COVID induced disruptions.

The Consumer Packaged Goods (CPG) or Fast-Moving Consumer Goods (FMCG), industry in India is one of the main drivers of the Indian economy. This sector has been reporting good growth even during the COVID years, when most other industries were reeling under a demand crunch, riding on strong consumer supported by consumption-led growth of products.

Despite a challenging environment marked by unprecedented inflation and its impact on consumption, your Company has demonstrated remarkable agility and resilience, achieving steady growth. During the year under review, Company recorded a growth of 32.59% in revenue from operations, reaching Rs. 81.86 crores and reported profit after tax at Rs. 2.54 crores. We focused on strengthening our business operations, expanding the distribution network, enhancing our digitization capabilities and presence in channels like e-commerce, organised retail and pharmacies.

Opportunities and Threats

FMCG products, being essential commodities, are expected to be in demand and provide good opportunities for growth.

Opportunities

Accelerated growth of e-commerce and modern trade has brought about a huge opportunity to tap into these channels and drive business growth. The rapid digitalisation of purchase behaviour require us to accelerate development of our e- commerce and e-RTM (Route to Market) capabilities. Strategically designed and flawlessly executed e-RTM, B2B solutions, and E2E supply chain transformation would open a huge opportunity to tap into the new age channels and drive business growth. The ability to keep our operations future-fit through building digital capabilities in systems, workforce, and business models will help us stay agile and respond in time to evolving stakeholder requirements. We are committed to operate and grow the business in a responsible way.

Threats

• Rising interest rates and inflation;

• Continuing geopolitical uncertainty to hit international markets;

• Changing consumer preferences;

• Threat of new players & competitive brand rivalry;

• Rising fuel and Input costs may dent the growth path;

• Attrition

Our business depends on purchasing materials and the timely distribution of products to our sub-distributors/ consumers. Our supply chain network is exposed to potentially adverse events, such as disruptions at a key supplier, which could impact our ability to deliver orders to our customers. The cost of our products can be significantly affected by the cost of underlying commodities and fluctuation in these costs may negatively impact business, especially if such movements are not effectively managed.

Segment wise or Product wise performance

Your Company is one of the leading importer and distributor of mother and baby care products, skin care products, food products, etc. all over India through network of dealers and distributors and professionally managed strong sales and marketing team. Your Company is exclusively engaged in the activity of trading of goods having strong distribution network dealing in two (2) product lines such as mother & baby care products including wide range of infant care products, skincare products for babies & new mothers and oral & personal care products and another trading line of food products including Thai food, sauces, Korean instant noodles, ready to eat products etc.

Outlook, Risks and Concerns

Despite the near-term ambiguity, the Company remains confident of the medium to long-term growth prospects considering the various categories of products of your Company deals in. Although the current situation is overall uncertain than normal, the Company is confident about its ability to manage the crisis, if any and come out of it successfully. The area of risks and uncertainties are as follows :

• Global and Macro-economic factors;

• Any unexpected changes in regulatory framework;

• Inflationary pressures;

• Rise in counterfeits and lookalikes;

• Retaining the talent pool could be a challenge.

Our risk strategy is determined by a risk appetite defined by a series of risk criteria. These are based on sectoral circumstances and internal capabilities within the accepted volatility limits. Risk management is part of our organisational to strengthen the operating model and make business growth more profitable and sustainable.

Internal Control Systems and their adequacy

The Company has an internal control system commensurate to the size and nature of its operations. The internal control system encompasses financial and operational controls and statutory compliances. There are appropriate controls with reference to policies and procedures, risk assessment, and ethics, which the Audit Committee periodically reviews. The Audit Committee, consisting of three independent directors, monitors the performance of the internal audits.

Thus, an effective internal control structure has been set up in the Company to enhance organisational performance and contribute towards accomplishing its objectives.

Financial Overview

Total revenue from operations at Rs. 81.86 crores for the year ended Mar 31 23 as against Rs. 61.74 crores for the corresponding previous period, an increase of Rs. 20.12 crores implying a growth of 32.59%. The Profit after tax for the financial year stood at Rs. 2.54 crores as against Rs. 1.46 crores in the corresponding previous year, reported an increase of Rs. 1.08 crores.

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations therefor, including :

Particulars	FY 22-23	Reason if change above 25%
Debtors Turnover	4.74	Change less than 25%
Inventory Turnover	1.08	Decreased by 71.85% due to increase in average inventory.
Interest Coverage Ratio	5.17	Change less than 25%
Current Ratio	2.30	Change less than 25%
Debt Equity Ratio	0.67	Change less than 25%
Operating Profit Margin (%)	4.23	Increased by 34.71% due to increase in turnover
Net Profit Margin (%)	3.10	Increased by 30.90% due to increase in turnover

Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof :

12.14% (Increased by 54.85% due to opting of New T ax Scheme substantial amount of Mat credit entitlement was written off resulting in substantial decrease in profit after tax in last year).

Development in Human Resource

For Rama Vision Limited (RVL), progress with people is at the heart of our corporate ethos and human resource policies. Over the years, the Company has been fostering a meritocratic, empowering and caring culture that encourages excellence. The Company nurtures talents by providing its people with opportunities to sharpen their capabilities. As a result, learning & development is a continuous process, and the HR function is committed to it.

RVL encourages innovation, lateral thinking and multiskilling, preparing its people for future leadership roles. In addition, the Company endeavors to provide a safe, transparent, conducive and secure work environment that facilitates getting the best out of its talent pool. The Company remains committed to ensuring zero harm to its employees, consumers and the communities in which it operates. This is integral to the Companys business process and is laid down in the Companys safety policies, standards and working procedures. Health and safety is a key performance indicator and one of the prime drivers of the Companys corporate vision. At the same time, the Company expects its employees to honor and uphold its values while serving the organisation with sincerity, integrity and commitment.

As of March 31 2023, the Company employed 125 employees across all locations.