Sun Granite Export Ltd Management Discussions.

MANAGEMENT DISCUSSION AND ANALYSIS

IANNEXURE- II

Industry Scenario and Development

The overall trend of the Indian Granite was healthy in the year 2007-08 as the Granite Industries come out of reversionary trend because of increase demand in national and international market. However, due to acute shortage of raw materials during the last financial year the performance of this company could not rise up to the expectations. I I! The company which has one of the largest modern plants of its kind in eastern India has been successfully exploring and creating its own market in USA, Middle East, and Australia. In order to overcome the obstacles of shortage of raw materials faced during 2008-09, the company has been making serious efforts to take more quarries on lease from Government of Orissa. I.

The demand for polished Granite slabs continuously grows due to market increase in construction activities in all sectors. With this positive factor the Management is optimist about the future performance of the company.

Internal Control

Your company has adequate internal control systems commensurate with its size and works in highly automated environment.

Risk and Concerns

The major consumables utilized by the company are imported. Further, being 100% export oriented unit foreign I :!exchange fluctuation has a commercial bearing on the performance of the Company. The Governments policy for grant of quarries as well as demarcation forest area concerns your company, for which adequate measures are being taken.

Human Resources / Industrial Relations

Your companys endeavor has been to attract, and nurture human potential by developing a culture of family and human values. The purpose is to encourage and attain the optimum human potential development. The I :! company has during the year continued to have good industrial relation with its employees.