ruchika industries india ltd Management discussions

Pursuant to Regulation 34(2)(e) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015

COMPANY OVERVIEW:

KCD takes great pride in being one of India’s leading construction service providers with an uncompromised commitment to Quality, Health, Safety, and Environment. Your Company’s diverse portfolio includes Industrial, Infrastructure, Commercial, Residential, Land Development Projects & Government services. Our vision is to be one of the most reliable and trustworthy Engineering, Construction and Project Management Company.

INDUSTRY OVERVIEW:

India’s real estate market is growing at an unprecedented rate, which is why it is no surprise that everyone is keen on the future. The advent of trends like sustainable developments, gated communities, improved amenities, low mortgage rates, and government aid for low-income residents helped boost the market last year. The real estate market in India is showing signs of growth and maturity. The current decade has seen the introduction of numerous reforms to promote transparency, efficiency, and innovation within the sector. This will lead to an increase in demand from domestic and foreign investors looking forward to the higher potential returns available in this booming sector in the upcoming years.

FINANCIAL PERFORMANCE:

(All amounts in Lakhs)

Particulars	Standalone
	31st March 2023	31st March 2022
Total Income	475.078	(6.345)
Less: Total Expenses excluding Depreciation	307.430	(48.273)
and tax
Profit/(Loss) before Depreciation & Tax	167.379	41.265
Less: Depreciation	0.269	0.663
Less: Exceptional Items	0.00	0.00
Profit/(Loss)before Tax	167.648	41.928
Less: Tax
i. Current Tax	0.00	10.500
ii. Deferred Tax	(0.007)	(0.080)
iii. Income Tax	4.849	12.245
Profit/(Loss)after tax	162.806	19.263

ACCOUNTING METHOD:

The above figures are extracted from the Annual Audited Financial Statements prepared in accordance with the Indian Accounting Standards ("Ind AS") as notified under Section 133 of the Companies Act, 2013 ("the Act") read with the Companies (Accounts) Rules, 2014 and other relevant provisions of the Act and the Securities and Exchange Board of India (Listing

Obligations and Disclosure Requirements) Regulations, 2015 ("the SEBI Listing Regulations").

OUTLOOK:

As we move along, we expect the situation to only improve and with our robust internal economy, lower dependence on exports, the future looks bright. We cannot wish the domestic competition, which is bound to be fierce; each one trying to protect his share of the market will do all in its might doing so. The leaders will never let go anything. The lower end will try to nibble. We intend to protect our own facility or infra and effectively and strategically so for long term survival and perpetuation. Your company is on a good wicket to do this, given its standing in the market.

HUMAN RESOURCE DEVELOPMENT:

Our employees are critical to our business. We internally assess our employees to periodically identify competency gaps and use development inputs (such as skill upgradation training) to address these gaps. We have implemented staff training policies and assessment procedures and intend to continue placing emphasis on attracting and retaining motivated employees. We plan to continue investing in training programmes and other resources that enhance our employees’ skills and productivity. We will continue to help our employees develop understanding of our customer oriented corporate culture and service quality standards to enable them to continue to meet our customers’ changing needs and preferences. The company continued with its focus on an efficiently recruiting employees with the right talent and groom them to build a strong leadership pipeline. The diversity and inclusiveness in the workforce remained a strong fundamental to the company, in line with it the company continued to bring in more women employees.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has in place a well-framed internal control system that authorizes, records, and reports transactions to safeguard assets and protect against loss from unauthorized use or disposition. The internal controls ensure the reliability of data and financial information to maintain accountability of assets. These internal controls are supplemented by extensive internal audits, management review, and documented policies, guidelines, and procedures.

RISK AND CONCERNS

The Company is dedicated to identifying and managing the risks it is exposed to, both internal and external, and has put in place mechanisms to handle the same proactively and competently. The Company also recognises that these risks could adversely affect its ability to create value for all stakeholders and has taken steps to mitigate the same. Some of the major risks involved mentioned hereunder:

i. Industry Cyclicality

The real estate market is inherently a cyclical market and is affected by macroeconomic conditions, changes in applicable governmental schemes, changes in supply and demand for projects, availability of consumer financing and illiquidity. Your Company has attempted to hedge against the inherent risks through a business model comprising owned projects, joint ventures, residential platforms, and development management through a pan-India presence.

ii. Statutory Approvals

The real estate sector in India is heavily regulated by the central, state and local governments. Real estate developers are required to comply with a number of laws and regulations, including policies and procedures established and implemented by local authorities in relation to land acquisition, transfer of property, registration and

iii. Construction Risk

Design Risk

Environmental Risk Procurement Risk

Sub-Contractors Risk Technology Risk.

Design Risk

Disputes between labours

Changing sequences in construction activity Non availability of resources Change in quantities of work

In Time work permissions for executing work Safety of workers Stoppage of work due to Medical outbreak Delay in Land acquisitions and hand over Legal battles for disputes

iv. Environmental Risk:

Impact of weather condition on completion of project Pollution by construction waste

Procedure to facilitate construction waste clean-up or disposal.

v. Financial Risk:

Delay from clients to release funds

Unprecedented delay in executing of project Interest service costs.

Change in Legislation leading to considerable financial outflow. Delay in procurement of funds for taking up the project

OPPURTUNITIES & THREATS

KCD is an Integrated Real Estate and Infrastructure company with inherent strengths of experienced management team with broad geographic and operational base. It has an execution expertise over diversified array of projects and being considered as one stop shop for end to end project execution.

Growing Competition of Indian industry due to focus on efficient and quality. Vast export marked to explore. Growing recognition of "Made in India" brand in global market Major growth through outscoring opportunities

Support from the Government and better financial support from players of the Financial

Eco System.

Awareness among the society at large for a better sustainable growth of the economy and pressure from world institutions to enable the economy move towards clean and green energy.

CAUTIONARY NOTE

Statements in the Management Discussion and Analysis Report, which describe the

Company’s objectives, projections, estimates and expectations, may be ‘forward-looking statements’ within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could influence the Company’s operations include economic developments within the country, demand and supply conditions in the industry, commodity prices, changes in government regulations, tax laws and other factors such as litigation. The Company does not undertake to update these statements.