Saffron Industries Ltd Management Discussions.

MADHYADESH PAPERS LIMITED ANNUAL REPORT 2010-2011 MANAGEMENT DISCUSSION AND ANALYSIS FINANCIAL RESULTS: (RUPEES) SALES AND OTHER INCOME 25,99,24,617 Loss before Financial Charges & Depreciation (70,44,036) Less: Financial Charges 33032777 Depreciation 23991472 (6,40,68,285) Add: Prior Period Adjustments NIL Profit/(Loss) Before Tax (6,40,68,285) Less: Provision For Taxation NIL Profit/(Loss) after Tax (6,40,68,285) Add: Prior Period Adjustments 1,31,097 Add: Surplus Brought Forward 54,31,345 Balance carried forward 5,85,05,842 REVIEW OF OPERATIONS: During the year under review the Sales Turnover of your company during current year was Rs. 25.88 Crore as against Rs. 24.92 Crore in previous year. However, the high cost and scarce availability of raw material in the market continued this year also, resulting into availability of small margins between sales turnover and the raw material consumed, which ultimately resulted into the loss of Rs. 6.40 Crore as compared to loss of Rs. 5.97 Crore in the last year. However your company has achieved marginally better sales turnover amount this year as against the sales turnover amount of last year. Your company is trying to overcome the adverse situation by way of using various efforts to reduce the overall cost and to increase its sustainability by planning for better prospects of the company using various new avenues to avail the low cost raw material and by always trying for better price gains for its product in the market and by continuing efforts for its growth as well. FUTURE OUTLOOK: In this scenario of high cost market, you will appreciate the hardship the company is facing. However, we expect this scenario to change by the end of this year and the domestic newsprint market is expected to become buoyant once again which would augment in improving sales realisations and profitability which will again take care of companys subsistence and growth in the market.