The Management of the Company is pleased to present its report on the Industry Scenario
including on the Companys performance during the financial year 2022-23.
1. INDUSTRY STRUCTURE AND DEVELOPMENTS
Global Economic Outlook
Global growth is projected to fall from an estimated 3.5 percent in 2022 to 3.0 percent
in both 2023 and 2024. While the forecast for 2023 is modestly higher than predicted in
the April 2023 World Economic Outlook (WEO), it remains weak by historical standards. The
rise in central bank policy rates to fight inflation continues to weigh on economic
activity. Global headline inflation is expected to fall from 8.7 percent in 2022 to 6.8
percent in 2023 and 5.2 percent in 2024. Underlying (core) inflation is projected to
decline more gradually, and forecasts for inflation in 2024 have been revised upward.
The recent resolution of the US debt ceiling standoff and, earlier this year, strong
action by authorities to contain turbulence in US and Swiss banking reduced the immediate
risks of financial sector turmoil. This moderated adverse risks to the outlook. However,
the balance of risks to global growth remains tilted to the downside. Inflation could
remain high and even rise if further shocks occur, including those from an intensification
of the war in Ukraine and extreme weather-related events, triggering more restrictive
monetary policy. Financial sector turbulence could resume as markets adjust to further
policy tightening by central banks. Chinas recovery could slow, in part as a result of
unresolved real estate problems, with negative cross-border spillovers. Sovereign debt
distress could spread to a wider group of economies. On the upside, inflation could fall
faster than expected, reducing the need for tight monetary policy, and domestic demand
could again prove more resilient.
In most economies, the priority remains achieving sustained disinflation while ensuring
financial stability. Therefore, central banks should remain focused on restoring price
stability and strengthen financial supervision and risk monitoring. Should market strains
materialize, countries should provide liquidity promptly while mitigating the possibility
of moral hazard. They should also build fiscal buffers, with the composition of fiscal
adjustment ensuring targeted support for the most vulnerable. Improvements to the supply
side of the economy would facilitate fiscal consolidation and a smoother decline of
inflation toward target levels.
SUMMARY OF OUR BUSINESS
Our company is engaged in processing of semi-finished furniture products into finished
products. Our company specialize in developing a qualitative range of Industrial Furniture
and Restaurant and Cafe Furniture, Garden and Outdoor Furniture Vintage Furniture, Mirror
Frames, Wall clocks and various other decoration & handicrafts objects. We are
instrumental in presenting a wide assortment of exclusively designed products, such as
Restaurant Furniture, Cafe Furniture, and Metal Furniture. Our expert professionals are
devoted to developing an exclusive product range capable to gain a nationwide appreciation
for its remarkable finish, unique designs, trendy colour combinations, flawless detailing,
unbreakable quality and higher durability. It is one of the Trade Indias verified and
trusted sellers providing satisfactory range of all kind of furniture.
Our Companys proficiency lies in understanding the specific requirement of our
customers and based on which we place the order of our products to manufacturer having
requisite manufacturing facilities. We source our products from reliable manufacturers of
the market. We purchase the order in semi-finished condition and then process the same by
finishing, assembling and repairing turning them into finished products. Our company make
further sales to wholesalers, retailers and customers through online platforms such as
Indiamart, Trade India, Exporter India and Trade Pooja etc.
We are committed to gain a distinguished repute and as an emerging company, our
objectives towards differentiation are further strengthened by our rigorous research and
analysis activities. We have implemented advanced technology that equips us to design and
develop decorative items with computerized processes. Our products are cherished by the
corporate sector and widely utilized for gifting and decorative purpose in the hospitality
industry. We owe our rapid growth to the allied support of leading vendors who underpin
our vigilant approach to source premium quality raw products. Besides, our production
efficiency gained us huge acclamation across the country.
OUR COMPETITIVE STRENGTHS
We believe that the following are our primary competitive strength:
Experienced Management Team: -
Our management team is experienced in the industry in which we are operating and has
been responsible for the growth of our operations and financial performance. Our Promoter
Mr. Hitesh Karnawat leads the company with his vision. They are having an adequate
experience in the line of the business undertaken by the Company and look after the
strategic as well as day to day business operations. The strength and entrepreneurial
vision of our Promoter and management have been instrumental in driving our growth and
implementing our strategies. We believe that the experience of our management team and
its in depth understanding of the furniture market in the region will enable us to
continue to take advantage of both current and future market opportunities.
Existing Supplier Relationship: -
Our existing supplier relationship protects the business with terms of supply and
pricing of the products, the quality of the products offered etc. We, being a small and
medium size organisation, rely on personal relationships with suppliers. Our company
enjoys existing relationship with our suppliers. Further we also leverage the past
experience of our management in maintaining effective supplier relationship.
Scalable Business Model:-
We believe that our business model is scalable. Our business model is customer centric,
and requires optimum utilization of our existing resources, assuring quality supply and
achieving consequent economies of scale. The business scale generation is basically due to
development of new markets both domestic and international by exploring customer needs and
by maintaining the consistent quality output.
Quality Assurance and Standards: -
We believe in providing our customers the best quality products. Our ability to
maintain and improve the products we offer to customers enables us to generate stable
revenue and minimize customer complaints. We are very particular from usage of right
quality of material for production. Our dedicated efforts towards the quality of material
have helped us gain a competitive advantage over others. We believe that our quality
production has earned us a goodwill from our customers.
OUR BUSINESS STRATEGY
Leveraging our Market skills and Relationships
Our Company believes that our business is a by-product of relationships. This is a
continuous process in our organization and the skills that we impart in our people give
importance to customers. We aim to enhance the growth by leveraging our relationships and
further enhancing customer satisfaction. We plan to increase our customers by meeting
orders in hand on time, maintaining our customer relationship and renewing our
relationship with existing buyers.
Improving functional efficiencies
Our Company intends to improve functional efficiencies to achieve cost reductions to
have a competitive edge over the peers. Our employees are regularly motivated to increase
efficiency with error free exercise. We believe that this can be done through continuous
process improvements. Further we believe that this can be done through domestic presence
and economies of scale. Increasing our penetration in existing regions with new range of
products, will enable us to penetrate into new catchment areas within these regions and
optimize our infrastructure. As a result of these measures, our company will be able to
increase its market share and profitability.
Enhance customer base and to establish long-term relationships
We intend to cater to the increasing demand of our existing customers and also to
increase our existing customer base by enhancing the distribution reach of our products in
different parts of the country. We propose to increase our marketing and sales team which
can focus in different regions and also maintain and establish relationship with
customers. Enhancing our presence in additional regions will enable us to reach out to a
larger population. Further our company believes in maintaining long term relationship with
our customers in terms of increased sales. We aim to achieve this by value adding value to
our customers through innovation, quality assurance and timely delivery of our products.
To build-up a professional organization
As an organization, we believe in transparency and commitment in our work and with our
customers. We have an experienced team for taking care of our day-to-day operations. We
also consult with external agencies on a case-to-case basis on technical and financial
aspects of our business. We will consistently put efforts among its group of experienced
employees to transform them into an outstanding team of empowered professionals which
helps in further accelerating the wheels of development of the Organization.
Expand geographical reach
We intend to expand our presence by identifying markets where we can provide
cost-effective and quality products to prospective customers. Further, we seek to
capitalize on our existing experience, established contacts with customers and
manufactures.
2. OPPORTUNITIES AND THREATS Opportunities
^ Potential to provide other value assed services ^ Expanding new geographical area ^
Opportunities in Indian Market
^ Government thrust for development will boost in rise in demand.
Threats
^ Increased Competition from Big Players ^ Change in Government Policies
^ Rising labour wages
^ There are no entry barriers in our industry which puts us to the threat of
competition from new entrants
3. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE
The Company is primarily engaged in the processing of semi-finished furniture products
into finished products and manufacturing through job work of furniture and handicraft
items, which in the context of AS 117 on "Operating Segments" constitutes a
single reporting segment. Further, there are no reportable geographical segments.
4. OUTLOOK
Handicrafts is one of the most important sectors in the Indian economy employing more
than seven million people. The country produces woodware, artmetal wares, handprinted
textiles, embroidered goods, zari goods, imitation jewellery, sculptures, pottery,
glassware, attars, agarbattis, etc. The handicraft industry in India is dominated by
female artisans with over 56% of the total artisan. The country has 744 handicraft
clusters employing nearly 212,000 artisans and offering over 35,000 products.
India is one of the largest handicrafts exporting country and a clear leader in the
homemade carpet segment both in terms of volume and value. During April 2022-February
2023, the total exports of handicrafts stood at US$ 3 billion. In 2021-22, the total
exports of Indian handicrafts were valued at US$ 4.35 billion, a 25.7% increase from the
previous year.
India boasts of a rich heritage of unique craftsmenship, woodwork, carpentry &
furniture with regions like Jodhpur emerging as demand centers for the local industry.
Indias Furniture Exports witnessed a 220% increase from USD 810 Mn in 2018-19 to USD 2.6
Bn in 2022-2023.
5. THREATS, RISK AND CONCERNS
The Company is concerned about prevailing exposure norms, financial position, entry of
new players in the market, rising competition from banks & multilateral agencies,
uncertain business environment, fluctuation in rupee, likely increase in cost of capital
due to volatile market conditions. Further, the state of business and policy environment
in the country also has a cascading effect on the interest-rate regime, cost and
availability of raw materials and gestation period & capital outlays required for raw
material.
6. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
The Company maintains an adequate system of Internal Controls including suitable
monitoring procedures to ensure accurate and timely financial reporting of various
transactions, efficiency of operations and compliance with statutory laws, regulations and
Company policies. Suitable delegation of powers and guidelines for accounting have been
issued for uniform compliance. In order to ensure that adequate checks and balances are in
place and internal control systems are in order, regular and exhaustive Internal Audit of
Office/plant are conducted by the in-house Internal Audit Division and external
professional audit firm. The Internal Audit covers all major areas of operations,
including identified critical/risk areas, as per the Annual Internal Audit Programme. The
Audit Committee of Directors periodically reviews the significant findings of different
Audits, as prescribed in the Companies Act, 2013 and in the SEBI (Listing Obligations
& Disclosure Requirements) Regulations, 2015.
7. FINANCIAL AND OPERATIONAL PERFORMANCE
Revenue from the operations of your Company for the year 2022-23 was Rs.456.80 Lakhs
which is 69.88% more than Rs.137.60 Lakhs in the previous year. Profit before Depreciation
Interest & Tax for the current year was Rs. 22.57 Lakhs against Rs. 15.75 Lakhs in the
previous year. Profit after tax for the current year at Rs. 21.15 Lakhs was increased by
50.26% over Rs. 10.52 Lakhs in the previous year. Detailed report on operations of and
structure of Business of the Company has been included in Management Discussion and
Analysis Report, which forms part of this Annual Report.
8. HUMAN RESOURCES / INDUSTRIAL RELATIONS
The Company gives utmost importance to the capacity-building and well-being of its
employees. The Industrial Relations in the Company continued to be on a cordial note.
There are regular interactions between the management and the representative-associations
on issues pertaining to employee welfare. The Company has an atmosphere of trust and
cooperation, which results in a motivated work force and consistent growth in the
performance.
9. ANALYSIS OF SIGNIFICANT CHANGES IN FINANCIAL RATIOS
As per the recent amendments to the SEBI Listing Obligations & Disclosure
Requirements (LODR), we give below additional information in respect of financial
parameters that are applicable to our company:
Detail of Significant changes (i.e. change of 25% of more as compared to the
immediately previous financial year) in key financial ratios, along with detailed
explanation therefore as under:
a) Debtor Turnover Ratio: The Debtor Turnover ratio as on March 31, 2023 is 4.33
times as compared to 3.07 times in the previous year.
b) Inventory Turnover Ratio: The Inventory Turnover Ratio as on March 31, 2023
is 5.26 times as compared to 7.65 times in the previous year.
c) Interest Coverage Ratio: The Interest Coverage Ratio as on March 31, 2023 is
3.88 times as compared to 0.00 times in the previous year.
d) Current Ratio: The Current Ratio as on March 31, 2023 is 9.21 times as
compared to 4.21 times in the previous year.
e) Debt Equity Ratio: The Debt Equity Ratio as on March 31, 2023 is 0.29 times
as compared to 0.00 times in the previous year.
f) Operating Profit Margin: The Operating Profit Margin Ratio as on March 31,
2023 is 4.94% as compared to 11.45% in the previous year.
g) Net Profit Margin: The Net Profit Margin Ratio as on March 31, 2023 is 4.63 %
as compared to 7.65% times in the previous year.
Cautionary Note
Certain statements in "Management Discussion and Analysis" section may be
forward looking and are stated as required by applicable laws and regulations. Many
factors may affect the actual results, which could be different from what the Management
envisages in terms of future performance and outlook.
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