Shrenik Ltd Management Discussions.

Annexure-8

1. This section shall include discussion on the following matters within the limits set by the listed entitys competitive position:

A. Industry structure and developments.

India has emerged as the fastest growing market when it comes to consumption of paper products, posting 10.6% growth in per capita consumption of paper in 2017-18 as per the recent research papers. India produces many varieties of papers, namely, printing and writing paper, packaging paper coated paper and some speciality paper. Varieties under printing and writing paper are cream wove paper, super printing paper, maplitho paper (non-surface and surface size), copier paper, bond paper and coating base paper and others. The varieties under packaging paper are kraft paper, boards, poster paper and others. The other varieties under coated paper are art paper/board, chromo paper/board and others. Indian paper industry is poised to grow and surpass 25 million tonnestill 2019-2020.

As per the recent researches, the Indian paper industry is one of the most flourishing and thriving industries of India. It is the 15th largest in the world. The paper industry in India looks extremely positive as the demand for paper products, like, coated paper, maplitho paper, printing paper, etc., is growing up.

B. Opportunities and Threats.

There are immense opportunities stored in the Indian Paper Market. The Paper Traders have huge scope of spreading their business across the several geographical areas all over India. Considering the Gujarats geographical area to be specific to our Business area, there are around 33 districts and 250 talukas to be served. Availability of this huge scope encourages the producers and the traders to increase their marketing and selling capacities. Our company, specifically, has also established its Brach Office in Jaipur, Rajasthan which is another promising state of India for the Paper Market.

One of the main challenges of the Indian paper industry is the ever-increasing wood and pulp prices which serve as the raw materials for making paper. Aside from the increasing prices of the Papers, the huge working capital requirements too remain a challenge. But on comparing the opportunities and the challenges, its the opportunities that carries the heavy weight. Hence the Indian Paper Industry is here to grow.

C. Segment-wise or product-wise performance.

The Sale of Papers in the Financial Year 2017-18 amounted to Rs. 591,24,82,632/- bifurcated amongst the products like Coated Paper, Maplitho, Copier, FBB, Color Paper, Imported Maplitho Paper and Imported Coated Paper.

D. Outlook

The Indian paper sector is an organized sector with the view of ever increasing demand. High usage of paper in every sector is one of the main drivers of paper industry in India. Ballarpur Industries Limited, Tamilnadu Newsprint and Papers Limited, NR Agarwal Industries Limited and Shah Pulp and Paper Mills Limited are few of top players in the Indian Paper Industry and we are glad to be one of their distributors. Aside from Indian Paper Industry, Asia Pulp and Paper (Indonesia & China) is a globally recognised Player in the Paper Industry, and we are one of the distributors of the said Mill as well.

E. Risks and concerns.

One of the major risks in the Indian paper industry is the ever-increasing wood and pulp prices which serve as the raw materials for making paper. Aside from the increasing prices of the Papers, the huge working capital requirements remains a matter of concern.

F. Internal control systems and their adequacy.

The Company has an adequate and efficient internal control system, which provides protection to all its assets against loss from unauthorized use and for correct reporting of transactions. The internal control systems are further supplemented by internal audit carried out by the Internal Auditor of the Company and periodical review by the management. The company has put in place Proper controls, which are reviewed at regular intervals to ensure that transactions are properly authorized & correctly reported and assets are safeguarded. The Audit Committee of the Board addresses issues raised by both the Internal and Statutory Auditors. The internal control systems are implemented to safeguard the Companys assets from loss or damage. To keep constant check on cost structure and to provide adequate financial and accounting controls and implement accounting standards. In addition to above, the Company has formulated a Vigil Mechanism (Whistle Blower Policy) for its Directors and Employees of the Company for reporting genuine concern about unethical practices and suspected malpractices.

G. Discussion on financial performance with respect to operational performance.

The Company continues to see marginal growth in its overall performance in the financial year 2017-18 driven by the performance of the segment in which the Company operates. The total income of the Company increased to Rs. 594,11,02,171/- from Rs. 428,08,71,265/- in the previous year at a rate of 38.78%. The profit before tax amounted to Rs. 12,15,80,433/- as against Rs. 6,47,26,632/- in the previous year. The net profit after tax was increased to Rs. 7,91,08,484/- as against Rs. 4,18,44,925/- in the previous year.

H. Material developments in Human Resources/Industrial Relations front including number of people employed. The Company has in place adequate number of employees as required in its Registered Office and in its Godowns. Professionals with required amount of experience and knowledge are hired on need to need basis by the Company.

The Industrial relation of the Company with various suppliers, customers, financial lenders and employees is cordial. There are total 17 employees on the payroll of the Company.

I. Forward looking statements:

Outlook for future are estimates based on certain assumptions and expectations of future events, eco-political and other developments across the country, the company cannot guarantee that these are accurate or will be realized. The companys actual results, performance or achievements could thus differ from those projected in any forward looking statements. The company assumes no responsibility to publicly amend or revive any such statements on the basis of subsequent developments, information or events.

2. Disclosure of AccountingTreatment:

The Company has followed all the treatments in the Financial Statements as per the prescribed Accounting Standards.