Shree Ganesh Forgings Ltd Management Discussions.

I. Industry Structure, Opportunities and Threats:

The forging industry in India traditionally catered to the automotive sector and moved to the infrastructure industries after the growth of infrastructure and related industries picked up. The Indian auto industry which has witnessed substantial growth in the year under review has given a spurt to the forging units catering to that sector. However, forging units catering to the infrastructure industries generally tend to have lower margins in view of customized and specialized end products which can be improved upon only if they can become more cost- efficient.

With the growth in the automotive sector, and the recovery of the developed economies, overall growth in all segments is expected. Of course, the major threat faced by the forging industry being the easy availability of cheap imported forged products in the domestic and the international markets has not receded.

II. Segment-wise or Product-wise performance

During the year company was not in operation.

III. Outlook for the Company:

We, at Shree Ganesh Forgings Ltd have made substantial investments in high tech, state -of- the- art equipment of the highest international standards. Although our products were well established in the international market, the company has been undergoing a long phase of business losses owing to various factors including radiation- related problems, labour issues and our bankers reluctance to implement the reworked CDR scheme sanctioned by the CDR Cell. The Company has thus been saddled with recovery claims from the bankers on one side and partial closure of operations on the other. Negotiations for settlement are on with the bankers and other options such as sale or lease of land and buildings and shifting operations to another location, or sale of business are being explored actively so as to generate the required funds.

IV. Risks and concerns:

The Company has declared as sick company on 27th January, 2016 by the Board of Industrial and Financial Reconstruction (BIFR). The Board of Directors of the company reviews and assesses the risk factors on a continuous basis. The Chief Executive Officer of the Company is the Chairman and Director, who is also responsible for the overall risk governance in the Company. The prime concern now is to repay the banks outstanding and revive the Company.

V. Internal Control Systems and their adequacy:

In the opinion of the management, the Company has adequate internal audit and control systems, to ensure that all business transactions are recorded, approved and reported correctly and wherever required it will make all possible efforts to strengthen its internal audit and control system.

VI. Financial and Operating Performance:

The financial and operating performance has already been discussed in the Directors Report. The management is actively considering various options to restart operations.

VII. Human Resources:

The Company has high regard for its human resources and considers it as amongst its most valuable assets. However, operational difficulties and labour problems have forced the company to lay off some of its employees.

VIII. Cautionary Statement

This report contains forward-looking statements based on certain assumptions and expectations of future events. Actual performance, results or achievements may differ from those expressed or implied in any such forward - looking statements. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent developments, information or events.

For Shree Ganesh Forgings Limited
Deepak Sekhri
Chairman
DIN: 00054671
Date: 13.08.2019
Place: Mumbai