rishabh digha steel allied products ltd share price Management discussions

INTRODUCTION:

As of April 2022, India was the worlds second-largest producer of crude steel, with an output of 10.14 MT. In FY23, the production of crude steel and finished steel stood at 126.26 MT and 122.28 MT, respectively. The growth in the Indian steel sector has been driven by the domestic availability of raw materials such as iron ore and cost-effective labour. Consequently, the steel sector has been a major contributor to Indias manufacturing output.

The Indian steel industry is modern, with state-of-the-art steel mills. It has always strived for continuous modernisation of older plants and up-gradation to higher energy efficiency levels.

The Indian steel industry is classified into three categories - major producers, main producers and secondary producers.

Source: www.iebf.org

BUSINESS OVERVIEW:

Rishabh Digha Steel & Allied Products Ltd. with you valuable raw material you can be best rest assured that your material is in safe and competent hands. With ever rising steel prices, we understand how precious raw material is to your organization. Faulty processing, not within acceptable tolerances, can play havoc with your profits, negating all efforts at minimizing costs, without your knowledge.

IMPACT OF COVID-19:

The company has discontinued its job-work activity since 01st October , 2020 majorly due to the COVID-19 impact. As per Ind AS 105 , a discontinued operation of an entity is the operation which has been disposed off or has been classified as held for sale. As the management does not have committed plan to sale and the sale can not be completed within one year , the operations and its assets are not classified as Discontinued Operations or Held For sale. The management is considering various restructuring plans for the company.

FINANCIAL HIGHLIGHTS:

• Paid up Share Capital of the Company as on 31 March 2023, stands at 54864000 divided into 5486400 number of equity Shares of Rs. 10/ - each fully -paid up.

• Income from operation stood at Rs. 1,24,140/- for fiscal 2023.

• Profit/Loss before Taxes of fiscal 2023 was Rs. -45,12,350/

• Basic Earnings per Share for fiscal 2023 was Rs -0.81.

• Net Worth of the company stood at Rs.6,59,65,460/ - as on March 2023.

MARKET SIZE

In FY23, the production of crude steel and finished steel stood at 126.26 MT and 122.28 MT, respectively. The consumption of finished steel stood at 119.86 MT in FY23. In April 2022, Indias finished steel consumption stood at 9.072 MT.

In FY23, exports and imports of finished steel stood at 06.72 MT and 06.02 MT, respectively. In FY22, Indias export rose by 25.1% YoY, compared with 2021. In FY23, India exported 07.72 MT of finished steel.

OUR COMPETITIVE STRENGTHS:

a) Dynamic Management:

The Company is led by professional management team comprising experienced leader and young brigade of technocrats. The promoters are ably supported by skilled and professional managerial team. This dynamic team has been instrumental in creating best-in-class technology and processes to enhance customer experiences and lead to overall growth of the company.

b) Diverse Offerings:

Alacrity Securities Limited offerings comprise share broking and trading services in equity, futures & options, and currency derivatives, among others. It provides mutual fund advisory services to clients and has ventured into providing comprehensive wealth management services to the client. The Company has affiliated with one of the best Wealth Management Companies. This diversified range of financial services enables it to cater to varied requirements of its customers.

c) Technology Competence:

The company has deployed state-of-the-art technology, adopted automated solutions, and digitised processes to ensure seamless services and high operational efficiency Its automated trading strategy based on algorithmic and quantitative trading solutions gives it a competitive edge in the marketplace.

d) Strong Customer Relationships:

Customer service and experience is a top priority at the Company. The Company provides hassle-free and seamless services to the Customers. Its relentless focus on client coverage, timely resolution of customer complaints, and customer satisfaction have helped it forge strong relationships with its customers.

GROWTH STRATEGIES:

a) Strengthening Business:

The Company aims to capitalize on its existing strengths, while at the same time consolidate its presence in business segments. This will enable the Company to increase its market share and achieve greater economies of scale.

b) Enhancing Client Base:

Alacrity Securities Limited enjoys an unblemished reputation in market and strong relationships with all its stakeholders, which has been at the cornerstone of its continued success. The Company intends to bank on this strong reputation and goodwill to increase its clientele and grow business sustainable with diversified products and services.

c) Harnessing Technology:

Technology is an important tool in the creation of consistent business value. The Companys robust technology-based trading platforms have resulted in increased speed and convenience leading to superior customer experience.

d) Empowering Human Capital:

Recognizing that people are the most important asset of an organization, the Company offers a conducive work environment and career opportunities to motivate its employees encouraging them to deliver improved services to clients.

RISKS AND CONCERNS:

It is essential to correctly assess the risk in each segment so that the risk is mitigated before it becomes a possible threat. General risk segments are statutory compliances, economy, financials, Government policies, market related, operational, products and technology etc., The management has a rapid review of likely risk areas with the objective to define a framework for identification, evaluation and mitigating the risk in the decision-making process and to encourage proactive management and not reactive management.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has robust internal controls systems (including Internal Financial Controls) that facilitates efficiency, reliability and completeness of accounting records and timely preparation of reliable financial and management information. The internal control system ensures compliance with all applicable laws and regulations facilitates optimum utilization of resources and protect the Companys assets and investors interests. The Companys well-defined organizational structure, documented policy guidelines, defined authority matrix and internal controls ensure efficiency of operations, compliance with internal policies and applicable laws and regulations as well as protection of resources.. The Audit Committee of the Board regularly reviews significant audit findings of the Internal Audit system covering operational, financial and other areas.

RISK MANAGEMENT:

Risk Management is an ongoing process. Effective risk management is therefore critical to any organizational success. Globalisation with increasing integration of markets, newer and more complex products and transactions and an increasingly stringent regulatory framework has exposed organizations to and integrated approach to risk management. Timely and effective risk management is of prime importance to our continued success. The sustainability of the business is derived from the following:

• Identification of the diverse risks faced by the Company.

• The evolution of appropriate systems and processes to measure and monitor them.

• Risk Management through appropriate mitigation strategies within the policy framework.

• Reporting these risk mitigation results to the appropriate managerial levels.

CAUTIONARY STATEMENT:

Statements in the Management Discussion & Analysis, describing the Companys objectives, projections and estimates are forward looking statement and progressive within the meaning of applicable laws & regulations. Actual result may vary from those expressed or implied. Important developments that could affect the Companys operations are significant changes in political and economic environment in India, tax laws, exchange rate fluctuation and related factors.