sacheta metals ltd Management discussions


MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Overview of the Company

We, SACHETA METALS LIMITED, a Public Limited Company established in the year 1990. The Registered Office and Manufacturing Unit of our Company is situated at Sacheta Udyog Nagar, Opp. College, Mahiyal, Talod-383215, Gujarat. Our Corporate Office is situated at the Business Capital Centre of India Mumbai at Sakseria Industrial Estate, S. V. Road, Malad (West), Mumbai 400064 (INDIA).

We, SACHETA METALS LIMITED, are one of the major manufacturers & exporters of Aluminum, Stainless and mild steel Houseware Kitchenware Utensils - Casting - Sheet – Coils - Circles, Non Stick Cookware - Pressure Cooker, Foil Chaquered sheet, PP Caps / Slug & other Houseware & also Stainless Steel Kitchenware in India.

Financial Review

Turnover achieved for the year ended 31st March, 2023 was Rs. 99.29 Crores as against Rs. 91.96 Crores in the previous year.

Employee cost was Rs. 6.92 Crores as against Rs. 6.94 Crores in the previous year.

The finance cost of the Company was Rs. 0.76 Crores as against Rs. 0.39 Crores in the previous year.

Depreciation (including amortization) was increased of Rs. 1.80 Crores as against Rs. 1.30 Crores in the previous year.

Net Profit after tax for the current year reduced to Rs. 2.06 Crores as against Rs. 2.22 Crores in the previous year.

Earnings per share (EPS) for the year was Rs. 1.08 as against Rs. 1.16 in the previous year. The higher a companys EPS, the more profitable it is considered

New Activities:

a) Looking into the current market the Company is planning to expand its operations in production of steel and to foray in the production of copper utensils especially kitchen equipments. This project is in its initial stage and the Company will copout with detailed project in the next coming quarters.

b) Company has established dealership in many geographical area, for aluminium foils. The Company is planning to increase its market strength by spreading distributors network across the India in the coming years. The Company has willingness to invite new distributorship for its products which are most welcomed.

Research & Development:

During the year under review, the Company has incurred capital expenditure Rs. 2908360 (P.Y.Rs. 289400), and revenue expenditure Rs. 377529 (P.Y. Rs. 2277800).

Aluminum industry in India

The Indian Aluminum Industry is a highly concentrated industry, with India being the worlds second-largest producer. It has a share of nearly 5.3 percent of global aluminium output. In spite of rising demand, Indias aluminium industry is thriving at an incredible rate. Indias primary aluminium exports have risen rapidly in recent years. India Exports of aluminum was US$9.06 Billion during 2021.

Aluminium is an important strategic metal for Indias economy. After the iron and steel industry, aluminium is the second most important industry. Aluminium is used in the production and distribution of electricity in the modern world (it is a good conductor of electricity), household utensils and electric appliances, aircraft manufacturing, rail coaches, nuclear and defence accessories, and so on. Its also the fastest-growing metal, with nearly a 20-fold increase in the last 60 years (compared to 6 to 7 times for other metals).

In the downstream sector, it created over 8 lakh jobs directly and indirectly, as well as over 4000 SMEs. In terms of the Bauxite reserve base, India ranks seventh in the world. Bauxite is the primary raw material used in the production of aluminium. The National Mineral Exploration Trust was set up to ensure an increase in aluminium production and to make the required volume of raw materials available to the industries.

Government of India is targeted to provide electricity to all villages of the country and joint all villages with the national highways of the Country, which increase demand of aluminum in the country. In India, there is growth of aerospace industry, which is also directed to increase in aluminum supply and growth of aluminum industry.

Cautionary Statement

Statements in this Management Discussion and Analysis describing the Companys objectives, projections, estimates and expectations may be forward looking statements within the meaning of applicable laws and regulations. Actual results may differ substantially or materially from those expressed or implied. Important developments that could affect the Companys operations include a downward trend in the particular industry, rise in input costs, exchange rate fluctuations, and significant changes in political and economic environment in India, environment standards, tax laws, litigation and labour relations.

Shareholders are cautioned that certain data and information external to the Company is included in this section. Though these data and information are based on sources believed to be reliable, no representation is made on their accuracy or comprehensiveness. Further, though utmost care has been taken to ensure that the opinions expressed by the management herein contain their perceptions on most of the important trends having a material impact on the Companys operations, no representation is made that the following presents an exhaustive coverage on and of all issues related to the same. The opinions expressed by the management may contain certain forward-looking statements in the current scenario, which is extremely dynamic and increasingly fraught with risks and uncertainties.