Shyam Metalics & Energy Ltd Management Discussions

Global Economy Overview

In the year 2023, the global economy showcased remarkable resilience, expanding by 3.3%, despite facing geopolitical challenges and fluctuations in commodity prices, which led to inflationary pressures across both advanced and emerging markets1.

In order to combat this challenge, central banks of major economies have devised its strategies. They implemented the increased interest rates, supressing the escalation. Despite persistent geopolitical tensions, disrupting global supply chains and trade, inflation rates declined more swiftly than anticipated from their peak in 2022, resulting in gradual economic recovery and job creation in the US, Europe and other emerging markets. Chinas economy continued to experience strain throughout 2023, a trend expected to persist into 2024, given its significant manufacturing capabilities and supply chain influence, posing a potential risk to global economic stability. Due to the rising foreign institution investor interest, several emerging economies like India, Vietnam and Mexico are expected to show a positive growth trajectory.

Outlook

The global economy is projected to maintain steady growth rates around 3.2% in both CY 2024 and CY 2025. While the global growth rate remains modest by historical standards, inflation is expected to decline. The global headline inflation is projected to fall from an annual average of 6.8% in 2023 to 5.9% in 2024 and further to 4.5% in 20252.

This indicates a potential soft-landing scenario where inflation gradually returns to target levels without precipitating a recession or financial instability. However, the global economy is not without its risks. Geopolitical tensions and policy uncertainties could lead to fluctuations in commodity prices and financial markets. This increasing geoeconomic fragmentation is also adding to the complexity of the global economic landscape.

Indian Economy Overview

The Indian economy demonstrated remarkable resilience in the face of global economic challenges. A robust resurgence in consumer demand, strong performances across manufacturing, services and agricultural sectors, buoyed by a favourable monsoon have been pivotal in this growth trajectory. According to the National Statistical Office (NSO) India has registered a real GDP growth of over 7% during FY 2024. Indias per capita disposable income has been rising over the years and is expected to be Rs. 2.14 lakh in 2023-24, driven by overall economic growth. This rebound in economic growth can be attributed to Indias sound macroeconomic fundamentals, burgeoning domestic demand and prudent monetary policies implemented by the RBI.

The manufacturing sector experienced robust growth, expanding at double-digit rates, driven by sustained corporate profitability and declining input costs. India Incs interest coverage ratio, a measure of financial health, expanded for the third consecutive quarter in October-December 2023, supported by favourable raw material prices and cost efficiencies, despite moderate revenue growth. Companies across various sectors, including automobiles, cement, consumer durables, hospitality, oil and gas, petrochemicals, pharmaceuticals, and power, witnessed improvements in their interest coverage ratios.

Outlook

The outlook for the Indian economy in the financial year 2024-25 remains optimistic, with steady growth anticipated. The GDP for the FY 2024-25 is estimated to be over 8.2%3. Investments in infrastructure are projected to be a significant contributor of this growth. Despite global challenges, the Indian economy would keep growing owing to solid fiscal strategies and continuous policy improvements. The governments adherence to fiscal prudence and dedication to reform is poised to sustain investor interest and draw foreign

Industry review

Global steel industry overview

The global steel industry is experiencing a rebound, with demand projected to increase by 1.7% to 1,793 million metric tonnes in 2024 and by an additional 1.2% to 1,815 million metric tonnes in 20 254 . This resurgence marks a recovery from previous downturns influenced by the COVID-19 pandemic and other global economic pressures.

Regional Demand Dynamics

The demand for steel in China is expected to stabilise in 2024, reflecting the ongoing infrastructure investments which counterbalance declines in real estate. Chinas 1% decline in 2025 marks its shift from investment-heavy growth, while Indias steel demand is set to surge by 8.2% annually in 2024 and 2025, driven by infrastructure investments and sectoral expansion.

Meanwhile, the European Union faces challenges, with steel demand only marginally recovering in 2024 but expected to grow by 5.3% in 2025 amid high inflation and energy prices. The United States is showing a quicker recovery, supported by the Inflation Reduction Act and a reviving housing market5.

Sector-Specific Trends and Projections

The global construction sector is under pressure due to high interest rates and construction cost. It is projected to recover from 2025 onwards.

Starting in 2024, the manufacturing sector is showing signs of recovery. A significant rise in steel demand can be seen, owing to public infrastructure and green energy projects, particularly those focused on climate resilience and transitions such as wind energy. Steel usage for wind energy, for example, is expected to triple by 2030 compared to early 2020s levels.

Risks and Opportunities

The steel industry faces balanced risks and potential upsides. Opportunities could arise from the faster-than-expected decline in inflation and policy easing, which may uphold sectors like construction. However, escalating geopolitical tensions and persistent inflationary pressures pose risks, that could dampen economic recovery.

Indian steel industry overview

In Indias pursuit of a $5 trillion economy, the steel industry emerges as a key driver, laying the essential groundwork for this ambitious goal. In the fiscal year 2023-24, the Indian steel sector showcased notable growth, marking a significant step forward in its contribution to economic revitalisation.

During FY2023, India experienced a substantial surge in steel production, reaching 118 million metric tonnes, accompanied by consumption levels of 112 million metric tonnes6. This robust performance showcases the industrys resilience and its crucial role in meeting the rising demands of both domestic as well as industrial sectors.

Indias ascent to the position of the worlds second-largest steel producer has been solidified, with its current capacity standing at 171.35 million metric tonnes7. Government initiatives aimed at bolstering manufacturing, infrastructure and housing sectors have facilitated this expansion.

With strategic government interventions and industry resilience, India regained its position as a net exporter of steel by January 2024. This achievement underscores the industrys competitiveness on the global stage, thereby contributing significantly to enhancing Indias economic profile.

Outlook

Going forward, the future of Indias steel industry looks optimistic. It is cushioned by the resilience of the domestic economy and ongoing governmental focus on large-scale infrastructure projects. While challenges such as global economic uncertainties persist, the industry is well-positioned to face these challenges. Moreover, efforts towards ensuring secure access to raw materials and transitioning towards sustainable production processes will further enhance its global competitiveness.

Key Industry Drivers

The Indian steel industry is poised to grow, propelled by several key sectoral growth drivers that are integral to the countrys economic expansion and infrastructure development.

Infrastructure Development

Infrastructure is one of the strongest growth drivers for the steel industry in India. The governments substantial investment in infrastructure through initiatives like the National Infrastructure Pipeline (NIP) with estimated investment of Rs. 111 Lakh Cr over 2020 to 2025 i.e., an annual average investment of almost INR 22 Lakh Cr8. This would ensure continued high demand for steel. These projects span a broad range, including:

• Roads and Highways: The construction and widening of roads and highways require large quantities of steel for reinforcements, bridges, flyovers and culverts.

• Railways and Metro Systems: The expansion of the railway network, including the development of new metro lines across major cities and the upgrade of existing rail infrastructures, necessitates extensive use of steel for tracks, electrical systems, station structures and signalling equipment.

• Airports: Modernisation and construction of new airports, driven by increasing air traffic and the need to bolster tourism and trade, involve significant steel usage in hangar construction, terminal expansions and other infrastructural developments.

Urban Development and Smart Cities

The push towards building smart cities and enhancing urban infrastructure to accommodate Indias rapidly growing urban population includes:

• Smart City Projects: Initiatives to develop smart cities involve integrating digital technologies into urban management and services, which increases the need for steel in constructing smart infrastructure, residential and commercial building land utilities.

• Population Growth and Urbanisation: By 2030, it is projected that 40% of Indias population will reside in urban areas9, contributing significantly to the ongoing urbanisation. This trend not only increases the demand for new urban infrastructure but also for residential and commercial constructions, all of which are substantial consumers of steel.

Construction and Real Estate

One of the most significant consumer of steel is the construction sector. The sector is driven by both residential as well as commercial needs. According to CREDAI, the real estate sector is projected to reach $1.3 trillion, accounting for 13.8% of the projected GDP, by fiscal year 203410. The developments also include:

• Residential Housing: Government initiatives like the Pradhan Mantri Awas Yojana aim to provide affordable housing to millions, boosting demand for construction-grade steel used in building frameworks, roofing and reinforcement.

• Commercial Construction: Economic growth spurs the expansion of commercial infrastructure, including office spaces, shopping malls and entertainment complexes, which heavily rely on steel for structural integrity and architectural designs.

Government Policies and Initiatives

Enhancement of the Production Linked Incentive (PLI) Scheme

The Indian government has prioritised the PLI Scheme for Specialty Steel with the Ministry of Steel envisaging an investment of Rs. 10,000 crore in FY 2024-2511. With an aim of encouraging the production of high-value steel within India.

This is to attract substantial investments and promote the manufacture of high-grade specialty steel products that are typically imported, aiming to reduce import bills, enhance domestic manufacturing capabilities and generate significant employment opportunities.

Implementation and Expansion of Steel Scrap Recycling Policy

Further consolidation and expansion of the Steel Scrap Recycling Policy included additional investments in scrap processing centres. These centres enable the fulfilment of the policys goal of promoting a circular economy by efficiently recycling steel scrap, reducing the environmental impact of steel production and aligning with global sustainability trends.

Decarbonisation Initiatives and Task Forces

Formation of new task forces accelerated the adoption of green technologies, such as integrating green hydrogen in steelmaking and enhancing energy efficiency through advanced technological upgrades. Under the National Green Hydrogen Mission, a pilot scheme will be implemented with a total budgetary outlay of Rs. 455 crores till FY 2029-3012.

These initiatives are in line with Indias broader commitments to its climate goals and the promotion of sustainable industrial practices.

Amendments to Quality Control Orders (QCO)

Updates to the Quality Control Orders expanded the mandatory BIS certification to more steel products. This ensures that all domestically manufactured and imported steel products meet high safety and quality standards. It also makes sure that the products protecting infrastructure projects and consumer interests from substandard materials.

Focus on Raw Material Security

Amid global supply chain disruptions, policies prioritising raw material security for the steel industry were emphasised. High-level committees were tasked with exploring alternative sources of raw materials, such as coking coal and iron ore, from diverse geographies. These committees also explore collective buying strategies to stabilise prices and ensure a steady supply.

Support for R&D and Technological Innovation

Increased funding and support were provided for research and development activities focused on the steel sector. Efforts are promoted for collaborative projects between the industry and academic institutions to develop innovative and cost-effective production technologies. These can reduce the industrys carbon footprint and improve overall efficiency.

Opportunities and threats

Opportunities

Automotive Sector Expansion

The increasing focus on electric vehicles and cleaner technologies in the automotive industry necessitates the use of advanced high- strength steels. This development offers significant opportunities for steel manufacturers to innovate and provide specialised materials that enhance vehicle safety and efficiency.

Capital Goods Manufacturing Growth

Domestic Manufacturing initiatives like Make in India has led to an increased demand for steel in the production of machinery and equipment across various industrial sectors.

Railway Modernisation and Expansion

Significant amount of steel is in demand with continued investments in railway infrastructure, including the modernisation of existing lines and the introduction of high-speed rail projects, demand significant quantities of steel for construction and maintenance.

Power and Energy Sector Advancements

The expansion of renewable energy infrastructure such as wind and solar needs strong steel frameworks and components. This drives a steady demand for steel products.

Telecommunications Network Expansion

Advancements in digital infrastructure is driven by the governments push towards a digitally empowered economy. It necessitates the use of steel in the construction of telecommunications towers and related network structures.

Innovative Construction Solutions

The trend towards modular and prefabricated buildings in the construction sector offers new avenues for the steel industry. These building methods are becoming increasingly popular due to their cost-effectiveness and reduced construction times.

Expansion in Defence and Aerospace

The government makes investments in defence and aerospace capabilities. Various operations like the manufacturing of defence vehicles and aircraft, present opportunities for the use of specialised steel products that meet stringent quality and durability requirements.

Export Market Development

There are growing opportunities for the Indian steel industry to expand its export markets. This is seen especially in regions where infrastructural development is accelerating and local steel production is insufficient to meet the demand.

Environmental Sustainability Initiatives

As global and national focus on environmental sustainability intensifies, there is a rising demand for green steel products. This helps minimise environmental impact. This includes steel made from recycled materials or produced using energy-efficient processes.

Key obstacles faced by the Indian steel industry Finance

The Indian steel sectors growth requires significant capital investment, with costs heightened by the countrys relatively high interest rates on loans.

This financial hurdle is exacerbated by the cyclical nature of the industry. This can deter lenders due to the increased risk of downturns. Innovative financial solutions are required to support the hefty investments needed for capacity enhancement. These may include creating conditions that attract foreign direct investment and leveraging international capital markets. They also support government-backed funding initiatives to mitigate the financial challenges faced by the industry.

Logistics

Logistical efficiency is critical for the steel industry due to the bulky nature of raw materials and finished products. Indias aim to expand its steel production capacity to 500 MTPA by 2047 will require a robust enhancement of its logistics infrastructure. This infrastructure can then be used to manage the movement of approximately 2,000 MTPA of raw materials and finished products annually.

Positioned 44th on the World Banks Logistics Performance Index13, the country must address challenges such as insufficient rake availability, prevalent track congestion and suboptimal road infrastructure. Innovative logistical approaches, including the adoption of slurry pipelines, expanded use of inland waterways and strategic development of storage and blending facilities near ports and railways, are essential to meet these demands efficiently.

Raw Materials

The Indian steel industry relies heavily on imported coking coal. This has introduced susceptibility to global market fluctuations and supply chain risks.

In order to mitigate these vulnerabilities, efforts to enhance domestic coal production and diversify import sources are vital.

Developing alternative methods, such as coal gasification and increasing the use of scrap steel, can also contribute to a more selfreliant industry. Strategic long-term planning is important to secure a stable supply of raw materials and to cushion against international market volatilities that impact production and pricing.

Environment and Energy Consumption

Addressing environmental impact is a pressing challenge for the Indian steel industry. Steel production is energy-intensive and contributes significantly to carbon emissions. The shift to a more sustainable production process requires substantial investment in energy-efficient technologies and adoption of renewable energy sources. The sector is also under pressure to align with stricter environmental regulations, which may entail significant upgrades for older plants. The industrys commitment to reducing its carbon footprint involves balancing environmental responsibilities with maintaining economic viability in a competitive market.

Apart from these, the industry also faces few other challenges. The steel industrys inherent cyclicality, deeply influenced by global economic conditions and industrial demand cycles, leads to significant fluctuations in demand. This cyclicality can severely impact profitability and operational stability, especially during downturns. Intense competition from cheaper imports, primarily from China, Japan and South Korea, further strains the industry. Surges in imports during domestic demand slumps, affecting prices despite temporary relief from anti-dumping duties and tariffs.

Additionally, the industry grapples with a growing need for skilled labour due to rapid technological advancements, with significant skills gap particularly evident in emerging steel clusters. Technological competitiveness is also important, as failing to adopt advanced manufacturing processes and smart metals could leave Indian steelmakers behind their global counterparts.

Risks and concerns

Risk	Mitigation Measures
Market Volatility and Financial Risks: Market volatility due to substantial capital requirements for expansion and fluctuating raw material costs can affect the companys revenue and profitability.	Shyam Metalics Company raised funds through QIP and maintains a strong net cash position. It is also employed strategic partnerships and long-term contracts to stabilise raw material supply and costs.
Competition and Market Penetration Risks: There can be an increased competition from domestic and international producers as it expands into stainless steel and aluminium foils.	The Company enhances its brand presence by strengthening distribution networks and diversifying its product mix to broaden market reach and reduce vulnerability to competition. Additionally, it prioritises high-margin B2C products to sustain profitability and market stability.
Operational Efficiency Risks: There are risks of potential operational inefficiencies as production capacities scale up, increasing costs and causing delays.	The Company allocates resources towards modern manufacturing technologies and adopts efficient supply chain and inventory management systems to ensure operational effectiveness and cost management.
Environmental and Regulatory Compliance Risks: Compliance with stringent environmental regulations could lead to increased operational costs.	Shyam Metalics Company continues investing in sustainable practices integrating environmental sustainability into operations to meet regulatory demands and reduce costs.
Supply Chain and Raw Material Availability Risks: Volatility in raw material prices and supply chain disruptions can significantly impact production costs and schedules.	The Company strengthens backward integration by securing local sources of raw materials and utilizing captive power plants. It employs strategic stockpiling and establishes long-term contracts to enhance stability in operations.
Technological Advancements and Cyber Risks: Need for ongoing investment in new technologies to avoid obsolescence and maintain a competitive edge.	The Company consistently invests in research and development, with a particular emphasis on pioneering products such as battery- grade aluminium foil and high-grade stainless steel. It prioritises collaborations to remain at the forefront of technological advancements.

Company Overview

Shyam Metalics and Energy Limited is an Indian integrated metal producing Company with a presence across the metal value chain. The Company is one of the largest integrated steel producers in India, ranked 6th largest and is also among the leading ferro alloy manufacturers in the country.

SMEL operates an "ore to metal" integrated business model with steel manufacturing facilities located strategically near mineral reserves in West Bengal, Odisha, Chhattisgarh and Madhya Pradesh. The Company has a combined installed production capacity of 13.2 million metric tonnes per annum (MTPA) as of January 2024 across various product lines. Demonstrating consistent operational profitability since fiscal year 2005, SMEL has sustained a record of positive EBITDA annually. The companys distribution network spans domestically and internationally, with a presence in over 28 countries.

The Companys credit facilities have received affirmation with an AA/ Stable rating for long-term banking facilities and an A1+ rating for short-term banking facilities by Crisil. The outlook for the long-term rating remains stable.

Various Business Segment Capacities

Business Segment	FY24 (MTPA)	FY23 (MTPA)
Iron Pellet	6.00	4.8
Sponge Iron	2.90	2.3
Billets	2.01	1.7
TMT, Structural Steel, Wire Rods and Pipes	2.07	2.08
Specialty Alloys	0.22	0.22
Captive Power (MW)	357	297
Renewable Power (MW)	9	9
Stainless Steel Billet	0.12	0
Stainless Steel Finished Steel	0.15	0
Aluminium Foil	0.04	0.04

Human Resource

Human Resources at Shyam Metalics: Fostering Growth and Innovation

Shyam Metalics recognises the people as the most valuable asset. The commitment to fostering a supportive and dynamic work environment is central to the strategy for achieving sustainable growth and industry leadership. As a premier manufacturer in India, the Company focus on Human Resources (HR) that goes beyond traditional practices; it is integral to organizational success and reflects dedication to innovation, community impact, and employee well-being.

Shyam Metalics is more than just a workplace; it is a vibrant environment where talent is nurtured, growth is encouraged, and success is shared. Comprehensive HR strategy is encompassing talent development, employee well-being, digital transformation, and community engagement which ensures that we remain a leader in the manufacturing sector. The commitment to excellence and the success of its people reflects the dedication to being a top employer and a key driver of industry progress.

HR INTERVENTIONS AT SHYAM METALICS:

1. Talent Acquisition and Development

The HR department at Shyam Metalics plays a crucial role in the growth and success. The Company is committed to attracting, developing, and retaining top talent through:

• Recruitment and On boarding: focused on recruiting young professionals and local talent to build a diverse and skilled workforce. The recruitment efforts are designed to find individuals who align with the Companys values and contribute to its mission of excellence.

• Structured Training Programs: Shyam Metalics offers comprehensive training modules such as the Graduate Engineer Trainee (GET), Diploma Engineer Trainee (DET), and Management Trainee (MT) programs. These programs are aimed at equipping employees with the skills and knowledge needed for their roles and future leadership positions.

• Leadership Development: the Company invests in leadership and change management programs to develop the senior management and key personnel. These initiatives enhance strategic thinking, decisionmaking, and leadership capabilities.

2. Employee Well-being and Engagement

Employee well-being is a priority at Shyam Metalics. The Company implements various initiatives to support a balanced work-life experience:

• Work-Life Balance Policies: The leave policies include Paternity Leave, Pink Leave for female employees, Short Leaves, and flexible working hours, designed to accommodate the diverse needs of the workforce and support both personal and professional responsibilities.

• Well-being Programs: the well-being initiatives include yoga sessions, ergonomic support, gym facilities at plant locations, and free periodic medical check-ups. These programs are designed to maintain physical and mental health, ensuring that the employees remain engaged and productive.

3. Embracing Digitalization and Automation

Digital transformation is central to HR strategy, enabling to enhance efficiency and effectiveness:

• HRMS and CLMS: the integration of HR Management Systems (HRMS) and Contract Labour Management Systems (CLMS), tools improve workforce data management, automates routine tasks, and enhances the responsiveness of the HR services.

4. Commitment to Growth and Innovation

Shyam Metalics has experienced significant growth, evolving from a small DRI plant in Odisha to a leading manufacturer of Ferro Chrome, Sponge Iron, and Pellets, with a diversified portfolio including Long Products, Aluminium Flat Rolled Products, and Special Alloy Steel. This growth is supported by:

• Investment in Technology: the focus on technological advancements, including digitalization and automation, drives operational efficiency and fosters innovation.

• Skill Development: the company supports the Skill India Movement by engaging in skill development programs and providing training opportunities that enhance employability. This commitment aligns with national goals for improving workforce skills and economic development.

5. Recognition and Employee Satisfaction

The efforts to create a positive and engaging work environment have earned the Company the "Great Place to Work" certification for two consecutive years. This recognition reflects the dedication to employee satisfaction and engagement. Key aspects of the recognition efforts include:

• Reward and Recognition Framework: Shyam Metalics has structured framework for acknowledging and rewarding employee contributions, including monthly, quarterly, and bi-annual awards. This framework highlights achievements and motivates employees to excel.

6. Fostering Community and Collaboration: At Shyam Metalics, the philosophy of "SHYAM PARIVAAR" (Shyam Family) is embraced and this emphasises on treating employees as family members and creating a supportive work environment. Key initiatives include:

• Celebration of Festivals and Occasions: the Company celebrate various festivals and special occasions with its employees, reinforcing the sense of community and inclusivity.

• Direct Engagement with Leadership: The VC & MD is actively involved in HR practices, engaging directly with employees to address concerns and make informed decisions. This approach fosters open communication and empowerment.

Financial and Operational Performance

• Total Income increased by 6.45% from 86,264.16 Crore to 86,668.45 Crore.

• Operating EBITDA increased by 30.42% from 8478.85 Crore to 8636.25 Crore.

• Net Profit increased by 17.51% from 8299.03 Crore to 8351.40 Crore.

Brief standalone financial performance for FY 2023-24

(Rs. in Crores)

Particulars	Year ended 31st March 2024	Year ended 31st March 2023
Total Income	6,764.85	6,319.29
Operating EBITDA	636.25	478.85
Interest and Financial Charges	57.93	37.79
Profit Before Tax	456.04	297.37
Tax Expenses	104.64	-1.66
Net Profit	351.40	299.03
Total Income (Repeated)	6764.85	6,319.29

Key financial ratios

(Rs. in Crores)

Particulars	Year ended 31st March 2024	Year ended 31st March 2023	% change
Debtors turnover (in times)	11.67	37.52	-69%
Inventory Turnover	6.92	5.79	20%
Return on Equity (%)	7.46	7.97	-6%
Interest coverage ratio (in times)	11.56	15.53	-26%
Current Ratio (in times)	2.16	1.26	72%
Debt-equity ratio (in times)	0.02	0.1	-82%
Operating profit margin (%)	9.54	7.79	22%
Net profit margin (%)	5.29	4.79	11%

Internal control system and their adequacy

The Companys Board of Directors operates an extensive system of internal control. It includes the organisations plans and policies to ensure orderly and efficient business conduct. The Board has also set-up appropriate processes to monitor the relevant external and internal risks. The Company follows a well-defined model of internal control system to deal efficiently and effectively with all the five components of Internal Control System, namely:

• Risk assessment.

• Control environment.

• Control activities.

• Information and communication.

• Monitoring the activities of the different levels of

the organisation.

The Companys internal audit is carried out effectively, leading to an independent and systematic assessment of its data, records, performances and so on with a predetermined objective. It has the potential to be one of the most influential and value-added services available to the Board. It emphasises on:

• Operational effectiveness and efficiency.

• Resource protection.

• Reliability of internal and external reporting.

• Compliance with applicable laws, regulations and internal policies.

Internal audit works as a catalyst for improving an organisations effectiveness, thus providing insight and recommendations based on analysis and assessments of data and business processes. With its commitment to integrity and accountability, internal audit provides value to governing bodies and senior management as an objective source of independent advice.

The organisation promotes independent examination of its plans and the policies, subject to the overall control environment supervision by the Board Level Audit Committee. This leads to accountability and transparency of operations and promotes independent examination. During the year, the Company focused on encouraging independent decision making, documentation of shortcomings of the various processes and departments and correction of the work processes. It is supplemented by well-documented policies, guidelines, procedures and regular reviews, which are carried out by the Independent Chartered Accountant Firm to conduct internal audit. The reports containing significant audit findings, if any are submitted to the Companys management and its Audit Committee.

Cautionary Statement

This statement made in this section describes the Companys objectives, projections, expectation and estimations which may be forward looking statements within the meaning of applicable securities laws and regulations. Forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised by the Company. Actual result could differ materially from those expressed in the statement or implied due to the influence of external factors which are beyond the control of the Company. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent developments.