Siyaram Silk Mills Ltd Management Discussions.

ECONOMIC OVERVIEW

Current Year Global Economic Overview.

Global GDP growth is estimated to have been 3.7% in 2017, the strongest outcome since 2011, with positive growth surprises in the Euro area, China, Turkey and Brazil. Industrial production, investment and trade growth have rebounded with global trade growth reaching an estimated 5.25% in 2017. Improved cyclical conditions are now being reflected in commodity markets and labour markets. Resurgent investment spending in advanced economies and strong recovery in global trade were important drivers of the global GDP growth and manufacturing activity.

Current Year Indian Economic Overview.

On the domestic front, the year 2017 was marked by a number of key structural initiatives to build strength across macro-economic parameters for sustainable growth in the future. However the Indian economy is headed for somewhat lower GDP growth estimated to be 6.5% in 2017-18. Even with this lower growth it is the highest among the major economies of the world. This is despite the structural reform of the Goods and Service Tax (GST) and the after effects of demonetization.

Indian Textile Industry Overview.

The year 2017 has turned out to be a mixed blessing for the Indian Textile Industry. While initiatives were implemented for power looms and weavers, the Exporters are still bleeding following the impact of GST resulting in Exports missing the USD 45 billion target set for 2017-18. On the domestic front the Indian Textile Industry has registered steady growth despite the difficult scenario. Your Company once again achieved a new high in its top as well as bottom line which is a commendable achievement.

Global Economic Future Outlook.

The World Economy is expected to strengthen over the next few years, with global GDP growth is projected to reach almost 4% in 2018. Growth in Advanced Economies is projected to be significantly more robust than previously anticipated, with smaller upward revisions in most other G20 economies. Ongoing improvements in business investment in the major economies should be reflected in stronger global trade growth.

Indian Economic Future Outlook.

The Indian Economy seems to be on the path of recovery with indicators such as industrial production, stock market index and exports which have shown some uptick. The Indian Economy with its ever growing domestic demand is expected to strengthen further in F.Y. 2018-19.

Textile Industry Outlook.

With the expectation of good monsoon, streamlining the implementation of GST, increase in per capita income of the masses, the future of Indian Textile Industry looks promising. Your Company is well poised to take advantage of its strengths – strong brands, resilient distribution network, new initiatives, establishing of new brands are expected to add value and create a formidable base for the future. Your Company expects reasonably good growth in the ensuing year.

Internal Financial Control system.

Your Company has in place an adequate internal financial control system, commensurate with the size and complexity of its operations. Necessary checks and controls are in place to ensure that all assets are safeguarded, to detect and prevent errors and frauds and that the transactions are properly verified, adequately authorized, correctly recorded and properly reported. The Internal Auditors of the Company conduct Audit of various departments to ensure that internal controls are in place and submit quarterly Reports to the Audit Committee. The Audit Committee regularly reviews these Reports and the Company when needed takes corrective actions.

The Internal Auditors also audit the effectiveness of the Companys internal financial control system. No major inefficiencies were reported.

Human Resources/ Industrial Relations.

Your Company treats its Human Resources as its important asset and believes in its contribution to the all-round growth of your Company. Your Company takes steps, from time to time, to upgrade and enhance the quality of this asset and strives to maintain it in agile and responsive form. Your Company is an equal opportunity employer and practices fair employment policies. Your Company is confident that its Human Capital will effectively contribute to the long term value enhancement of the organization. Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Industrial relations with staff and workmen during the year under review continued to be cordial.

Forward Looking Statements.

Statement in the Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include raw material availability and prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries in which the Company conducts business and other incidental factors.