Shree Steel Wire Ropes Ltd Management Discussions

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OVERVIEW OF THE ECONOMY:

India has emerged as the fastest growing major economy in the world as per the Central Statistics Organisation (CSO) and International Monetary Fund (IMF) and it is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnership. India is still projected to be the fastest-growing major economy, with growth estimates ranging from 6.3 % to 6.8 % for 2025-26. Young population corresponding low dependency ratio, improved investment rating and FDI inflow are some of the major factor of growth of the Indian economy.

It has been witnessed that Steel & Wire Manufacturing Industry is growing very fast. The demand of wires is expected to increase in leaps and bounds in the year to come. Steel Wire Rope Industry in india has prospered owing to growth in infrastructure activities and demand in industrial sector. This growth was witnessed majorly due to government initiatives such as Pradhan Mantri Awas Yojana, Atal Mission for Rejuvenation and Urban Transformation (AMRUT), Smart Cities Mission, Delhi Mumbai Industrial Corridor (DMIC) and others. The Companys major business continues to be with Indian Railways and the defence Sector, with a strong legacy and brand image.

The Company has shifted from oil fired furnace to induction furnace to avoid air and noise pollution. Induction furnace helps to minimizing heat loss and maximizing efficiency additionally. Induction furnace also offer better temperature control to produce less waste. The Company has purchased new machinaries which are based on VFD (Variable Frequency Drive) which helps to reduce electricity consumption.

The Company has installed Higher RPM (High Speed) 12 Bobbins stranding machines with PLC Control which helped to increased productivity, enhanced reliability, and improved product quality safety features.

The Company is putting increased focus on developing new products as well as upgrading and expanding existing product lines.

The primary growth drivers for steel wire ropes in India have been infrastructure development, increased industrial activity, enhanced emphasis on shipping and port sector along with growth in the mining industry. The resurgence in the Oil and Gas industry is expected to increase the number of oil rigs which will further add impetus to the growth of steel wire rope industry.

The Company has a strong brand and leadership position in the market for Steel Wire Ropes.

The Company is an established supplier and with a strong brand name in railways, defence sectors & industrial sector. Market penetration for any new product is possible with existing and new customers.

The Indian steel wire rope industry is poised for growth due to increasing infrastructure development, rising industrialization, and demand from various sectors like construction, mining, and oil and gas.

Opportunities exist for both domestic manufactures and those seeking to export product, particularly with a focus on high-tensile strength applications and specialized ropes.

The indian steel wire rope industry faces several risks including supply chain disruptions, competition from cheaper imports, and the increasing adoption of alternative materials.

Some Product lines in the Steel Wire Ropes segment are also affected with the increased competition from the unorganized sector with shrinking margins. There is falling in the selling prices of products and volatility in non-ferrous material prices.

Your Company has in place robust Internal Control System to maximize the effectiveness and efficiency by including activities that are tailored to the nature, size and complexity of the entity. The Company follows proper hierarchy for reporting of routine activities. Direct access to the senior Management is available in extreme cases. The Company has framed proper system to report concerned areas to the Management.

Management is responsible for establishing and maintaining internal financial controls. The company has adequate Internal Control System with reference to financial statements and to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

The Companys human resources strategy revolves around the development of the individual. The company undertook various Human Resources Initiative, namely-

A Performance Management System.

Training Programmes in the area of behavioural, management and technical skill up-gradation.

Development of leadership capability.

Maintaining high level of employment relationship.

Health, Safety, Security and environment (HSSE) is a key priority for your Company. Simply stated, our goal are: no accident, no harm to people and no damage to environment. The health, safety and security of everyone who works for your company, is critical to the success of business.

The Company is continuously putting efforts to achieve better results with effective monitoring of operational costs.

Considering the plan of Indian Railways and Defence Sector and improved inquiry from the industrial Sector theCompany expect further improved performance in the coming years.

Statement in the Management Discussion and Analysis describing the Companys objectives, expectations, predictions and assumptions may be forward looking within the meaning of applicable Securities Laws and Regulations. Actual result may differ materially from those expressed herein. important factors that could influence the Companys operations include global and domestic economic conditions affecting demand, supply, price conditions, change in Governments regulations, tax regimes, other statutes and other factors such as litigation and industrial relations.