In terms of Regulation 34 of SEBI (Listing Obligations And Disclosure Requirements),
Regulations, 2015 the Management Discussion and Analysis Report (MDAR) is structured as
follows:
• Market Trend & Economy
• Opportunities & Threats
• Segment-wise or product-wise performance
• Overview & Outlook
• Risk and Concerns
• Internal Control System
• Financial and operational performance
• Material Development in Human Resources
Some Statements in this discussion may be forward looking. Future performance may
however differ from those stated in the management discussion and analysis on account of
various factors such as changes in Government regulations, tax regimes, impact of
competition, etc.
MARKET TREND & ECONOMY
GLOBAL PRODUCTION OF LIME:
Below table shows country wide world production of Quicklime and hydrated lime,
including dead-burned dolomite.
Quantity in 000 tonnes
| Country Name |
2021 |
2020 |
2019 |
2018 |
2017 |
2016 |
| China |
3,10,000 |
3,00,000 |
3,00,000 |
3,00,000 |
2,90,000 |
2,30,000 |
| USA |
17,000 |
16,000 |
18,000 |
18,000 |
17,800 |
17,700 |
| India |
16,000 |
16,000 |
16,000 |
16,000 |
16,000 |
16,000 |
| Russia |
11,000 |
11,000 |
11,000 |
11,100 |
11,000 |
11,000 |
| Japan |
7,000 |
7,300 |
7,600 |
7,580 |
7,300 |
7,300 |
| Brazil |
8,100 |
8,100 |
8,400 |
8,300 |
8,300 |
8,100 |
| Germany |
7,100 |
7,100 |
7,100 |
7,000 |
7,000 |
6,800 |
| Italy |
3,500 |
3,500 |
3,600 |
3,600 |
3,600 |
3,600 |
| South Korea |
5,200 |
5,200 |
5,200 |
5,200 |
5,200 |
5,100 |
| Ukraine |
2,300 |
2,200 |
2,100 |
2,100 |
2,500 |
2,800 |
| Turkey |
4,700 |
4,600 |
4,700 |
4,700 |
4,700 |
4,300 |
Limestone reserves are adequate for most of the countries. China is the largest
producer of Lime as can be seen in above table. India is the 3rd largest
country in the World in terms of production according to data released by U.S. Geological
Survey, Mineral Commodity Summaries. All these countries produce adequate quantity of lime
for their own consumption.
According to experts, strongest annual growth of lime is expected to come from China,
India, US and other developing countries.
GROWTH OF INDIAN ECONOMY
Real GDP or Gross Domestic Product (GDP) at Constant (2011-12) Prices in the year
2021-22 is estimated to attain a level of ? 147.36 lakh crore, as against the First
Revised Estimate of ? 135.58 lakh crore for the year 2020-21, released on 31.01.2022. The
growth in GDP during 2021-22 is estimated at 8.7 percent as compared to a contraction of
6.6 percent in 2020-21 according to data released by the National Statistical Office.
Nominal GDP or GDP at Current Prices in the year 2021-22 is estimated to attain a level
of ? 236.65 lakh crore, as against ? 198.01 lakh crore in 2020-21, showing a growth rate
of 19.5 percent.
GDP at Constant (2011-12) Prices in Q4 2021-22 is estimated at ? 40.78 lakh crore, as
against ? 39.18 lakh crore in Q4 2020-21, showing a growth of 4.1 percent
The growth is mainly due to the companies rearranging their operations and recovering
from the COVID-19 impact, which had earlier led to restrictive containment measures
involving social distancing, remote working, and the closure of commercial activities that
resulted in operational challenges. Your Company has been continuously striving to keep
its costs to minimum possible to aggressively complete with Indian & global
competitors. Moreover, slowly India is getting competitive with respect to global
manufacturers, as global environmental rules are becoming stringent like that of India.
OPPORTUNITIES & THREATS
Many developments in Indian economy as triggered by globalization as one world market
are under cut-throat competitions, the prime opportunity lies in meeting customer’s
raised expectation in terms of high quality with value added products, prompt response,
timely delivery, proper services and performance and the same opportunities were regularly
grabbed by your company since its inception.
The growth in Lime sector is dependent upon the growth in various industries utilizing
Lime. Industries such as Steel & Iron, Water Treatment, Chemicals, Pharmaceuticals,
Paper & Pulp, and Construction etc. are some of the core consumers of Lime products,
all these industries are growing within its own domain leaving a growth path for Lime
Industry in India.
Your company strives to maintain pace with the fast development in the Indian economy,
tremendous competition and latest in technology and know-how with its limited resources.
The threats, which Lime industry generates sludge and dusting and its impact on
environment and competition from the global market. However, India has enough lime
resources with good quality accepted in international market, which is expected to fetch
sizable foreign exchange in time ahead.
Assessing the impact assessment of COVID-19 is however a continuing process given the
uncertainty associates with its nature and duration. The Company will continue to closely
monitor any material changes to future economic conditions.
SEGMENT WISE OR PORDUCT WISE PERFORMANCE
| F.Y. |
Hydrated Lime |
Others |
Transportation Revenue |
Total |
| 2021-22 |
38,23,52,999 |
2,93,44,914 |
3,56,54,229 |
44,73,52,142 |
| % |
85.47% |
6.56% |
7.97% |
100% |
OVERVIEW & OUTLOOK
The Company is highly competitive in selection of raw material from high quality
limestone. For this, the Company mainly depends on raw material to enable to produce
quality material according to customers’ requirements. The Company gives importance
to satisfaction of customers and their support in the long term. There are inherent
opportunities available to the Company to which it is catering for many decades such as
hydrated lime, quick lime, lime fines and other value added products and optimistic to
achieve good results.
The company has continued its efforts on enhancing its product profile and customer
segments which have helped it improve upon the margins across all its product segments.
The steps taken by the company in terms of improving the operational capabilities and
targeting value-added products has helped it cater to niche customers and improve its
customer profile. This has helped the company to partly off-set the adverse impact of
lower volumes to some extent. A close watch on the receivables and inventories helped the
company avoid any major mishaps in form of bad debt or stock losses. The company also made
focused efforts for better working capital management and brought down the levels of
inventories, receivables and payables by exercising tighter controls.
RISK AND CONCERNS
The Company has established a well-defined process of risk management, wherein the
identification, analysis and assessment of the various risks, measuring of the probable
impact of such risks, formulation of risk mitigation strategy and implementation of the
same takes place in a structured manner. Though the various risks associated with the
business cannot be eliminated completely, all efforts are made to minimize the impact of
such risks on the operations of the Company.
Various activities undertaken to achieve the goals make the Company susceptible to
various risks. It has to be recognized that risks are not merely the hazards to be avoided
but, in many cases, offer opportunities which create value ultimately leading to
enhancement of shareholders wealth, and ensuring sustainability of operations.
INTERNAL CONTROL SYSTEM
The Company has in place an adequate system of internal control commensurate with its
size and nature of its business. These have been designed to provide reasonable assurance
that all assets are safeguarded and protected against loss from unauthorized use or
disposition and that all transactions are authorized, recorded and reported correctly and
the business operations are conducted as per the prescribed policies and procedures of the
Company. The Audit committee and the management have reviewed the adequacy of the internal
control systems and suitable steps are taken to improve the same.
FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFOMRMANCE
We are already excelling in area of manufacturing lime and also endeavouring in allied
activities. The coming few years will be exciting and challenging at the same and your
company will continue to strive for excellence with economic value addition. Your Company
has recorded total revenue of Rs. 44,73,66,472/-, Net Loss for the Financial Year stood at
Rs. 56,51,929/- and recorded an EBIDTA of Rs. 3,38,10,040/- as standalone basis for the
financial year as on 2021-22.
Financial performance of the Company for Financial Year 2021-2022 is summarized below:
(Figure in rupees)
| Particulars |
2021-2022* |
2020-2021* |
| Revenue from operations |
44,73,52,142 |
43,91,17,362 |
| Other Income |
14,330 |
- |
| Total revenue |
44,73,66,472 |
43,91,17,362 |
| Profit before tax and Exceptional items |
(74,44,335) |
(71,72,736) |
| Exceptional items |
- |
- |
| Profit/ (Loss) before tax |
(74,44,335) |
(71,72,736) |
| Less: Tax Expenses |
|
|
| - Current Tax |
- |
- |
| - Deferred Tax |
(17,92,406) |
(21,77,337) |
| - Income tax of Previous years |
|
|
| Net Profit/ (Loss) For the Year |
(56,51,929) |
(49,95,399) |
* Figures regrouped wherever necessary.
HUMAN RESOURCES DEVELOPMENT AND INDUSTRIAL RELATIONS
Our Company firmly believes that its human resources are the key enablers for the
growth of the Company and important asset. Hence, the success of the Company is closely
aligned to the goals of the human resources of the Company. Taking into this account, your
Company continued to invest in developing its human capital and establishing its brand on
the market to attract and retain the best talent.
Employee relations during the period under review continued to be healthy, cordial and
harmonious at all levels and your Company is committed to maintain good relations with the
employees.
SIGNIFICANT CHANGES
(1) Debtors Turnover
Debtors turnover ratio reduced from 2.06 times of Revenues in FY.21 to 1.77 times of
Revenues in FY.22.
(2) Inventory Turnover
Inventory turnover ratio stood at 5.22 in FY.22 as compared to 5.73 in FY.21.
(3) Interest Coverage Ratio
Interest coverage ratio stood at 0.67 in FY.22 as compared to 0.63 in FY.21.
(4) Current Ratio
Current Ratio reduced from 1.35 in FY.21 to 1.23 in FY.22.
(5) Debt Equity Ratio
Debt Equity Ratio stood at 1.08 in FY.21 as compared to 1.08 in FY.22.
(6) Operating Profit Margin (%)
Operating profit margin has increased from 2.73% of revenues in FY.21 to 3.32% of
revenues in FY.22.
(7) Net Profit Margin (%)
Net profit margin (PAT) has reduced from -1.63% of revenues in FY.21 to -1.66% of
revenues in FY.22 on account of increased Finance Cost.
(8) EBTIDA Margin (%)
EBTIDA Margin stood at 7.56% in FY.22 as compared to 7.77% in FY.21.
RETURN ON NET WORTH AS COMPARE TO IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A
DETAILED EXPLANATION THEREOF
Return on net worth stood at -2.52% in FY.22 as compared to -2.18% in FY.21.
CAUTIONARY STATEMENT
The report may contain certain statements that the Company believes are, or may be
considered to be "forward looking statements" that describe our objectives,
plans or goals. All these forward looking statements are subject to certain risks and
uncertainties, including but not limited to, government action, economic development and
risks inherent in the Companys growth strategy and other factors that could cause the
actual results to differ materially from those contemplated by the relevant forward
looking statements.
|
For Raw Edge Industrial Solutions Limited |
|
| Date: 12th August, 2022 Place: Surat |
Sd/- |
Sd/- |
|
Bimalkumar Rajkumar Bansal |
Sourabh Bimalkumar Bansal |
|
Managing Director |
Director |
|
(DIN:00029307) |
(DIN:00527233) |
+91-9892691696
