The Board of Directors is pleased to share with you the Management Discussion and
Analysis Report for the Financial Year ended on March 31,2023.
COMPANY SYNOPSIS
Shri Jagdamba Polymers Limited is a company primarily engaged in the manufacturing and
export of techincal textile. Our main focus is on the export market, although we also
cater to domestic sales.
With a strong emphasis on quality and innovation, we strive to deliver superior textile
products that meet the diverse needs of our customers. Our extensive range of fabric
offerings allows us to cater to various industries and applications.
In addition to manufacturing, we also engage in job work activities, providing
customized solutions and services to our clients. This allows us to leverage our expertise
and capabilities to meet specific requirements and deliver value-added solutions.
At Shri Jagdamba Polymers Limited, we are committed to maintaining high standards of
customer satisfaction, product quality, and operational efficiency. With a dedicated team
of professionals and state-of-the-art manufacturing facilities, we ensure that our
customers receive reliable and superior products.
Our focus on exports enables us to expand our market reach and establish strong
relationships with international clients. We continuously explore new opportunities and
markets to further grow our export business and contribute to the economic growth of our
country.
Overall, Shri Jagdamba Polymers Limited is a dynamic and customer-centric company that
excels in manufacturing and exporting textile fabrics impregnated, coated, covered, or
laminated with plastic. Our commitment to quality, innovation, and customer satisfaction
sets us apart in the industry.
ANNUAL FINANCIAL PERFORMANCE
> Shri Jagdamba Polymers Limited experienced a decrease in profit after tax in the
financial year 202223 compared to the previous year.
> The companys profit after tax for the financial year 2022-23 was 3,006.26 Lakhs,
indicating a decline from the previous years profit of 5,116.05 Lakhs.
GLOBAL ECONOMY OVERVIEW
The global economy is projected to experience a slowdown in growth in the fiscal year
2022-23. According to the International Monetary Fund (IMF). The baseline forecast is for
growth to fall from 3.4 percent in 2022 to 2.8 percent in 2023, before settling at 3.0
percent in 2024. Supply-chain disruptions and rising geopolitical tensions have brought
the risks and potential benefits and costs of geoeconomics fragmentation to the center of
the policy debate. The global economy is projected to experience a slowdown in growth in
the fiscal year 2022-23 due to various factors such as supply-chain disruptions,
geopolitical tensions, and the COVID-19 pandemic.
INDIAN ECONOMY OVERVIEW
The Indian economy grew by 7.2% in real terms in the financial year 2022-23, according
to the Economic Survey 2022-23. This is lower than the 8.7% growth in the previous
financial year, but still a healthy pace of growth. However, India is currently facing the
challenge of addressing inflation, which has been further compounded by the ongoing
Russia-Ukraine conflict. Buoyed by its strong fundamentals, India has emerged as a
significant
force in the global economy, demonstrating remarkable progress over the past decade. It
has advanced from being the tenth-largest economy in the world based on exchange rates to
now occupying the fifth position. Furthermore, India has also secured its position as the
third-largest economy globally in terms of Purchasing Power Parity (PPP). This achievement
is attributed to key reforms that have been implemented, such as liberalization, the
reduction of bureaucratic hurdles and corruption, investments in infrastructure, and
increased accessibility of finance for small and medium-sized enterprises.
INDIAN TECHNICAL TEXTILE OVERVIEW AND OUTLOOK
The market for technical textiles in India is growing in various industries such as
automobile, agriculture, geotextiles, industrial/military, medical/healthcare, and
construction due to the unique functional properties offered by technical textiles The
Indian government has taken several positive steps to support the textile industry,
including announcing benefits in the Union Budget for 2022-23. The industrys contribution
to the Indian economy, employment generation, and export potential makes it a significant
player in the global technical textiles market. India is one of the largest exporters of
textiles and apparel in the world. India is a major player in the global technical
textiles market.
REVIEW OF OPERATIONS:
1. Revenue from Operations: The company reported total revenue from operations
of ^32,773.62 lakhs for the year ended March 31,2023, compared to ^36,905.33 lakhs in the
previous year. This represents a decrease in revenue.
2. Other Income: The company generated other income of ^861.45 lakhs, compared
to ^804.78 lakhs in the previous year. This indicates a slight increase in other income.
3. Expenses: The companys total expenses for the year were ^29,526.55 lakhs,
compared to ^30,972.87 lakhs in the previous year. This suggests a decrease in expenses.
4. Profit Before Tax: The company reported a profit before tax of ^4,108.51
lakhs, compared to ^6,737.24 lakhs in the previous year. This indicates a decrease in
profitability.
5. Tax Expenses: The company incurred total tax expenses of ^1,102.25 lakhs,
compared to ^1,621.1 lakhs in the previous year.
6. Profit After Tax: The company reported a profit after tax of ^3,006.26 lakhs
for the year ended March 31, 2023, compared to ^5,116.05 lakhs in the previous year. This
represents a decrease in profitability.
7. Earnings per Share (EPS): The basic earnings per share (EPS) for the year was
^34.33, compared to ^58.42 in the previous year. This decrease is in line with the reduced
profitability of the company.
Shri Jagdamba Polymers Limited experienced a decrease in revenue, profitability, and
earnings per share in the financial year ended March 31, 2023. The companys expenses
decreased slightly, but it still reported a lower profit before tax and profit after tax
compared to the previous year.
The company should focus on strategies to boost revenue and control expenses to improve
its financial performance in the coming years.
Exports Performance:
? In financial year 2021-22, the company had total sales of ^32,288.61 lakhs, out of
which ^31,601.77 lakhs were attributed to export sales.
? In financial year 2022-23, the companys total sales reduced to ^29,141.24 lakhs,
with export sales amounting to ^27,841.55 lakhs.
These figures indicate that the companys export sales decreased from ^31,601.77 lakhs
in 2022 to ^27,841.55 lakhs in 2023.
SEGMENT-WISE PERFORMANCE:
The Companys main business activity is manufacturing of Technical Textiles.
OUTLOOK:
The Company continues to explore the possibilities of expansion and will make the
necessary investments when attractive opportunities arise.
RAW MATERIAL PRICES
The prices of basic major raw materials used in our manufacturing process viz. PP/HDPE
of various grades doesnt affect much, as we are working in open market scenario.
OPPORTUNITIES AND THREATS:
Opportunities:
Investments in Technical Textile Industry: The Technical Textile Industry in India
is expected to witness investments in the financial year 2022-23. These investments can
create opportunities for growth and innovation in the sector.
Government Support: The Indian government has been taking initiatives to support
the growth of the Technical Textile Industry.
R&D Projects: The government has approved research and development (R&D)
projects in the textile sector. These projects can lead to technological advancements and
new product development in the Technical Textile Industry.
Market Growth: This Sector indicates the growth potential and opportunities
available in the sector.
Export Potential: Indian Export potential can open up opportunities for Technical
Textile manufacturers to tap into international markets.
Employment Generation: This Sector indicates the potential for job creation in the
Technical Textile sector as well.
THREATS
Competition: The Technical Textiles industry in India is highly competitive, with
many players vying for market share. Increased competition could pose a threat to
companies operating in this segment, as it may lead to price pressures and reduced profit
margins.
Raw Material Price Volatility: Fluctuations in the prices of raw materials, can
impact the cost of production for companies in the Technical Textiles segment. If the
prices of raw materials increase significantly, it could negatively affect profitability.
Changing Consumer Preferences: Consumer preferences and trends in the textile
industry are constantly evolving. If there is a shift in consumer demand towards
alternative materials or products, companies in the Technical Textiles segment may face
challenges in adapting to these changes and meeting customer expectations.
Regulatory Changes: Regulatory changes, such as import/export policies, taxation,
or environmental regulations, can have a significant impact on the Technical Textiles
segment. Companies need to stay
updated with the latest regulations and ensure compliance, as non-compliance could
result in penalties or restrictions on business operations.
Technological Advancements: Technological advancements and innovations can disrupt
traditional practices and processes in the Technical Textiles industry. Companies that
fail to embrace new technologies or adapt to changing market dynamics may find themselves
at a disadvantage compared to their competitors.
Global Economic Factors: The Technical Textiles segment in India is not immune to
global economic factors. Events such as economic recessions, currency fluctuations, or
geopolitical tensions can impact the demand for Technical Textiles products and affect the
overall business environment.
RISKS AND CONCERNS:
Polymers production relies on the availability and cost of raw materials such as
ethylene, propylene, and other petrochemical feedstocks. Any disruptions in the supply
chain or fluctuations in raw material prices can impact the production costs and
profitability of polymer manufacturers.
Increasing emphasis on environmental sustainability and circular economy practices can
pose challenges for polymer manufacturers. Meeting regulatory requirements related to
waste management, recycling, and reducing the environmental impact of polymer production
processes can require significant investments and operational changes.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS:
Human Resources are one of the most important ingredients for growth. Training of
employees to maintain high level of motivation is an ongoing process. Industrial relations
at all the units remained cordial during the year. The Company recognizes human resources
as its biggest strength which has resulted in getting acknowledgement that the Company is
the right destination where with the growth of the organization, value addition of
individual employees is assured. The total number of employees as on March 31, 2023 is
1409 (Previous Year employees was 1538).
INTERNAL CONTROL:
The Company has an adequate internal control system for safeguarding the assets and
financial transactions of the Company. The strong internal control systems have been
designed in such a way that, not only it prevents fraud and misuse of the Companys
resources but also protect shareholders interest.
ACCOUNTING POLICIES:
The accounting policies have been consistently applied by the Company and are
consistent with those used in the previous year. The financial statements have been
prepared under the historical cost convention on an accrual basis. The management accepts
responsibility for the integrity and objectivity of the financial statements, as well as
for the various estimates and judgment used therein.
DISCLOSURE OF ACCOUNTING TREATMENT IN PREPARATION OF FINANCIAL STATEMENT:
The Company has followed all relevant Accounting Standards laid down by the Institute
of Chartered Accountants of India (ICAI) while preparing Financial Statements.
DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE
IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS
Sr.
No. |
Ratio |
Numerator |
Denominator |
As At 31/03/2023 |
As At 31/03/2022 |
% Variance |
Reason for
Variance |
1 |
Current Ratio |
Current Assets |
Current Liabilities |
8.16 |
4.70 |
73.38% |
Refer Note -1 |
2 |
Debt-Equity Ratio |
Total Debt |
Total Equity |
0.09 |
0.21 |
-57.52% |
Refer Note -2 |
3 |
Debt Service Coverage
Ratio |
Earnings before Interest, Tax and Exceptional
Items |
Current maturity of long term debt + Interest Expense |
5.09 |
7.57 |
-32.80% |
Refer Note -3 |
4 |
Return on Equity
(ROE)(%) |
Profit after tax |
Average Net worth |
15.15% |
32.34% |
-53.15% |
Refer Note -4 |
5 |
Inventory Turnover
Ratio |
COGS |
Average Inventory |
5.16 |
4.68 |
10.28% |
|
6 |
Trade receivables
turnover
ratio |
Value of Sales & Services |
Average Trade Receivable |
4.43 |
4.75 |
-6.80% |
|
7 |
Trade payables
turnover
ratio |
Purchases |
Average Trade Payable |
28.64 |
28.66 |
-0.08% |
|
8 |
Net capital turnover
ratio |
Turnover |
Average working capital |
2.43 |
3.66 |
-33.66% |
Refer Note -5 |
9 |
Net profit ratio (%) |
Profit after tax |
Value of Sales & Services |
9.17% |
13.86% |
-33.83% |
Refer Note -6 |
10 |
Return on capital employed (ROCE)(%) |
EBIT |
Capital Employed |
19.47% |
34.28% |
-43.21% |
11 |
Return on investments (%) |
Net Profit |
Equity + Reserves & Surplus |
14.10% |
27.86% |
-49.40% |
Reasons for Variations
1. Current Ratio: It is primarily increased as the company has repaid its debt.
2. Debt-Equity Ratio: It is primarily decreased as the company has repaid its debt.
3. Debt Service Coverage Ratio: It is primarily decreased due to decrease in EBIT
of the company.
4. Return on Equity (ROE)(%) : It is primarily decreased due to increase in
Retained Earnings.
5. Net Capital Turnover Ratio: It is primarily decreased due to increase in average
working capital.
6. It is primarily decreased due to increase in Capital Employed and decrease in
earning as compare to previous year.
CAUTIONARY STATEMENT:
Certain statements in the Management Discussion and Analysis describing the Companys
objectives, projections, estimates, expectations or predictions may be "forward
looking statements" within the meaning of applicable securities laws and regulations.
Actual results could differ from those expressed or implied therein.
Registered Office: |
For and on behalf of Board of Directors |
Harmony, 4th Floor,15/A, Shree Vidhyanagar |
Shri Jagdamba Polymers Limited |
Co.Op. Hsg Soc. Ltd. Opp. Nabard,Nr. Usmanpura |
|
Garden, Ahmedabad- 380014, Gujarat. |
|
|
Ramakant Bhojnagarwala |
Date: August 14, 2023 |
Chairman Cum Managing Director |
Place: Ahmedabad |
DIN:00012733 |
+91-9892691696
