relstruct buildcon ltd Management discussions

1. OVERALL REVIEW ON INDUSTRY STRUCTURE & DEVELOPMENTS :

The Company is in trading industry. The overall performance during the financial year 2020-21 has been mild.

2. OPPORTUNITIES AND THREATS:

Opportunities:

Policy Regulations: The government has launched several key policies for the real estate sector. Some of these are Exemption under Income Tax Act for purchase of second house, RERA, Benami Transactions Act, boost to affordable housing construction, interest subsidy to homebuyers, change in arbitration norms. To boost this segment, the government has doled out various tax incentives and other reforms. Union Cabinet has decided to increase carpet area of unit 120 sq. meters and 150 sq. meters for MIG-I(income category of Rs.6-12lakhs per annum), MIG-II(income category of Rs. 12-18 lakhs per annum)along with interest subsidy of 4% further boosting buying and selling of housing units.

Government reforms: Aslew of initiatives by the Government are expected to provide a significant boost to this sector. The Government has allowed FDI of up to 100% for townships and settlements development project. Between2009-18, India’s real estate sector attracted. institutional investments worth USD 30 billion. Private Equity and venture Capital investments reached USD 4.47 billion in the sector during 2018. RBI has proposed to enable banks to invest in real estate investment trusts and infrastructure investment trust, thus attracting more institutional investors to these assets.

Threats:

Increase in input cost: Real Estate is a capital and labour intensive industry, thus a rise in cost of labour coupled with shortage creates issues in development of the project.

Shortage of skills and technology: Real estate is grappling with shortage of skilled professionals, which many times results in project delay. For, faster completion of projects, it is imperative to invest in skill development and training of primary construction workers.

3. SEGMENT WISE OR PRODUCT -WISE PERFORMANCE:

There is only one reportable segment of the Company that is real estate activity. Accordingly, segment wise reporting is not applicable to the Company.

4. BUSINESS OUTLOOK:

The company has business outlook for the trading of Building Material in the future. Company has also carried out other activities to combat covid -19 Situation and also sustain economically. The company is seeking more opportunities in the trading of all building material products in coming years.

5. RISK AND CONCERN:

The building, plant and machinery, vehicle and stocks of the company are adequately insured.

6. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

Considering the size of the company, your company has adequate system of internal control to provide reasonable assurance that assets are safeguarded and protected from unauthorized use or deposition. The management continuously reviews the internal control systems and procedure for efficient conduct of business. A strong system of internal audit committee of the Board has strengthened the internal control within the organization.

7. HUMAN RESOURCE DEVELOPMENT:

Your Company treats its “Human Resources” as one of its most significant assets. The Company continues its focus on retention through employee engagement initiatives and provides a holistic environment where employees get opportunities to realize their potential. A number of programs that provide focused people attention are currently underway. Your Company’s thrust is on the promotion of talent internally through job rotation and job enlargement. The Company’s Health and Safety Policy commits to provide a healthy and safe work environment to all employees.

8. ACCOUNTING TREATMENT:

The company has followed accounting treatment as prescribed in Indian Accounting Standard applicable to the company.

9. CAUTIONARY STATEMENT:

Statements in this report on management Discussion and analysis may be forward looking statements within the meaning of applicable security laws or regulations. These statements are based on certain assumptions and expectations of future events. Actual results could however, differ materially from those expressed or implied. Important factors that could make a different to the Company’s operations include global and domestic demand supply conditions, finished goods prices, raw material cost and availability and changes in government regulation and tax structure, economic development within India and the countries with which the company has business contacts and other factors such as litigation and industrial relations. The Company assumes no responsibilities in respect of forward looking statements which may be amended or modified in future on the basis of subsequent developments, information of event.