Shree Ganesh Elastoplast Ltd Management Discussions

CURRENT STATUS OF THE COMPANY:

The Company operates in the Business of Purchase, storage, Logistics, transportation and trading in various types of Agro commodities and other non-Agro commodities in addition to trading in shares and securities. The Trading in commodities business require more man power required for procurement, transportation, logistics and storage of Agro commodities. It also requires manpower from security guards to purchase managers, logistics managers and aggregators and sorters. Due to good monsoon in the previous year this sector was hit hard as majority of experienced manpower had transferred/ moved back to agricultural and farming business activities. Further MANREGA and other social programs for rural people by Government has also increased the cost of manpower which has ultimately increased the cost of main operations.

The commodity segment in which the company operates requires the participation from various entity including Agri-mandi, broker, labor, and transportation. There are various reasons for affecting this sector like non-availability of manpower, transportation problems etc. Thus, impacting the companys operation at unprecedented level. Moreover, the products have been in lime light for last couple years due to lucrative risk adjusted return. Due to such higher returns, there has been sudden spike in the participation by larger players. In addition, such lucrative return from the product was possible as there was some restriction from regulators for Institutional player to invest in specific commodity market. The company was taking advantage of such restriction to generate higher returns. However, the said restriction was lifted by SEBI, which has directly affected the operation.

As growing economy, India is growing at highest pace compare to other emerging countries. The said growth is also reflected in working of other listed companies. The management believes the value for the shareholders can be generated by investing in those companies which prominent player of the said development. Hence, the management believes by utilizing portion of the fund in said manner, good returns can be generated for the shareholders.

FUTURE COURSE OF ACTION FOR REVIVAL:

As operation in the commodity market has been disrupted by COVID- 19 and uncertainty of the revival in the market have given the directors reason to look for good opportunity in other area while being watchful of development in commodity market. The company will continue to look for opportunity in commodity market while exploring other opportunity. At currently, the company has started investing in capital market as that is the asset class our directors think where we can generate good return at present situation.

CAUTIONARY STATEMENTS:

The statements made in the report are based upon assumptions and expectations of future events. Actual results could however differ in future. The company assumes no responsibility in respect of forwardlooking statements that may be amended or modified later on the basis of subsequent developments, information and also subject approvals, consents of members in AGM/ EGM and also subject approvals from various government agencies, departments, etc. Any future non-compliances or nonperformance may occur in the event of non-receipt of such approvals, consents or any other events which may occur in future beyond the control of the management or company.