ranjeet mechatronics ltd share price Management discussions

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

COMPANY INTRODUCTION AND BUSINESS SEGMENT IN WHICH IT OPERATES:

The Company was established in the year 1949 in the name of Ranjeet Electric Limited and were working as an Authorised Dealer/ Distributor for Kirloskar Oil Engines, Kirloskar Brothers and Kirloskar Electric Co. Ltd. providing complete solution for fluid transfer.

RANJEET MECHATRONICS LIMITED, is one of Indias fastest growing Pipe Fabrication & Jointing Provider (MS, GI, SS, CS, FRP, GRE, DI, CPVC, UPVC, PP, CI, HDPE), Fire Protection System, Safety System, Security & Automation Solution Provider Company with Presence in almost all major cities of India.

INDUSTRY STRUCTURE & DEVELOPMENT:

The fire safety equipment market consists of sales of fire safety equipment by entities (organizations, sole traders, and partnerships) that are used to protect the user from fire during any firebreak. Firefighting equipment is a collection of tools and appliances used to extinguish fires. It can be utilized by professional firefighters and untrained users on the site of a fire, or it can be integrated into the infrastructure of a building (such as a sprinkler system).

Fire is one of the most frequently occurring disasters in India. The country has been a victim of fire incidents numerous times across many regions. The tier-1 and tier-2 areas, along with the factories and industries are extremely vulnerable to fire. The excessive number of deaths in the nation is due to fire threats. The occurrence of fire hazards has become an area of concern for both the developed and developing nations. Therefore in India, fire safety equipments are a mature market. Fire and Security Association of India and The National Disaster Management Authority (NDMA) are taking many crucial steps towards prevention of such incidents.

Market Dynamics

According to the fire alarm systems market demand is estimated to rise at 5.3% CAGR between 2023 and 2033 and would witness an absolute dollar growth of US$ 16.4 billion by 2033. The global fire alarm systems market is anticipated to witness an increase in revenue from US$ 24.1 billion in 2023 to US$ 40.6 billion by 2033. However, the high initial cost required for installation and dearth of integrity in system interfaces are constraining the growth of the market.

The India pipe fabrication market size was estimated at USD 516.1 million in 2022 and is anticipated to grow at a compounded annual growth rate (CAGR) of 7.7% from 2023 to 2030. The rising demand for piping systems used for transferring essential liquids and gases at industrial processing facilities is likely to boost the growth of the Indian pipe fabrication market. The growth can be attributed to the high demand for the product from various end-use industries such as chemical, oil & gas, electronics, food & beverage, and energy & power. The piping system is a significant part of any industrial process and activity, wherein pipe fabrication plays a vital role.

FINANCIAL:

The Total revenue from operations of the Company during the Financial year 2022-23 was higher at Rs.37,72,93,127/- against the total revenue of Rs. 34,50,21,528/- in the previous financial year 2021-22.

The Total expenses of the Company during the financial year 2022-23 was Rs.37,01,53,148/- against the expenses of Rs. 32,66,55,005/- in the previous financial year 2021-22.

The Profit after tax is Rs.71,16,554/- for the financial year 2022-23 as compare to Rs.49,64,255/- in the previous financial year 2021-22.

OPPORTUNITIES AND THREATS:

Your Company stood on an advantageous position by availing the opportunity of market penetration with its existing markets. Also the Company has been able to establish a secure market position by maintaining thriving customer relations and service strength.

As in normal and prevalent for any business, the Company is likely to face threat of increased competition from the local and global players operating in India.

RISKS AND CONCERNS:

The Company sometimes provides its service by extending credit to customers with the attendant risk of payment delays and defaults. To mitigate the risk, our team ensures that service to customers are provided after evaluating their ability to meet financial commitments through allotment of specific credit limits to respective customers.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has proper and adequate systems of internal controls commensurate with its size and nature of operations to provide reasonable assurance that all assets are safeguarded, transactions are authorized, recorded & reported properly and to ascertain operating business risks, which are mitigated by regular monitoring and corrective actions. The internal control systems have been designed so as to ensure that the financial and other records are reliable and reflect a true and fair view of the state of the Companys business.

A qualified and independent Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of Internal Control Systems as well as Internal Financial Controls and suggests improvements for strengthening them. Similarly the Internal Auditors are also monitoring the Internal Control/ Internal Financial Control Systems.

Human Resources:

Employees are the key to achieve the Companys objectives and strategies. Your Company considers human resource to be an important and valuable asset for the organization. Therefore, it constantly strives to attract and retain best "Talents" for the present and future business requirements and growth. The Company thankfully acknowledges their commitment, dedication and passion and sacrifices. And the Company expects their continuous guidance and support in future. The Company inspires and motivates employees and promotes teamwork, trust and confidence for the organizational growth and to attain the organizational goals. The Company is going to provide a meaningful environment which gives boost in their confidence and help to realize their potential and motivation to develop personally and professionally. The Board is reshaping the size of the employees as per the projects and business in hand.