Svarnim Trade Ud Management Discussions


A. Industry structure and developments

The Textile Industry is facing exceptional and unprecedented challenging conditions. There is a rise of demand for low-cost products having sustainable and environment - friendly production processes. Consumers are seeking products that are made from renewable materials and from sustainable manufacturing processes. Further, rising importance of digital technology in textile products, 3D modelling and other technologies are enabling manufacturers to create more innovative and customized products while improving production efficiencies and reducing waste. Hence, there is an optimism that post geopolitical stabilization, textile sector will show positive trends due to new opportunities and technological innovations supported by domestic & global demand, investment incentives (PLI) and strong balance sheets of companies. Further, China plus one policy adopted by USA / Europe will give a boost to Indian Textile Sector.

B. Opportunities and Threats

Opportunities:

a) China plus one policy, Economic collapse / volatility in Sri Lanka, Myanmar, Bangladesh, and Pakistan has played out in favour of India as the world has started looking at India as reliable partner for their requirement.

b) Rising demand for low cost, sustainable and eco-friendly products. This presents an opportunity for textile manufacturers to develop new products that are made from renewable materials and produced using sustainable manufacturing processes. Cost can be reduced by blending with cheaper man-made fiber.

c) Emergence of new Markets: FTA with Australia, Comprehensive Economic Partnership Agreement (CEPA) with UAE and expected favorable trade agreements with UK / Europe present an opportunity for textile manufacturers to expand into new markets and diversify their customer base.

Threats: a) The biggest threat to cotton products is competition from other low-cost man-made fibers.

Consumers are shifting their focus to low-cost products which has led to intense competition and pricing pressure in the global textile industry.

b) There is a high cost to comply with environmental, social and labour regulations which can be costly and time - consuming.

c) Further the textile industry is highly sensitive to global economic conditions and can be significantly impacted by global demand and pricing.

C. Outlook

The coming year will be challenging with respect to pricing. We have to focus more on offering new products and meeting customer retail price points. Also focus will be on blending with manmade fibers that can fit into the price bracket acceptable to buyers. Overall, the textile market is somber and expected to take around one quarter to stabilize. Further, we must navigate the challenging period by differentiating ourselves through innovation and quality. The manufacturers who will be able to address these challenges, while also differentiating themselves through innovation and quality, are likely to be successful in times to come.

D. Risks and concerns

The Company remains apprehensive about possible changes in government policies which might adversely affect the purchasing power of consumers. The Company is equally concerned, about revival of economy that should propel to increase the demand and see buoyancy coming back in the market sentiments, amongst the factors which are vital for sustaining overall growth. The company is hopeful that by enlarging its capacities, retail expansion being undertaken, constantly bringing in new products through innovation and employing new marketing strategies will greatly help it in mitigating the adverse impacts apprehended above.

E. Internal control systems and their adequacy

The Company has an adequate internal control system which commensurate with the size and nature of its business. The internal control system is being supported by internal audits, regular reviews by management to ensure reliability of financial and all other records to prepare financial statements and other data. Further the Audit Committee of the Board review the findings and recommendations of the internal audit and suitable implementations are affected.

F. Discussion on financial performance with respect to operational performance

The financial performance of the Company for the Financial Year 2022-23 is described in there as a part of Board of Directors of the Company.

G. Material developments in Human Resources / Industrial Relations front including number of people employed

The Companys HR philosophy is to establish and build a high performing organization, where each individual is motivated to perform to the fullest capacity to contribute to developing and achieving individual excellence and departmental objectives and continuously improve performance to realize the full potential of our personnel. The Company has designed and implemented performance management system of employees that helps in achieving its goals. Industrial relations are cordial and satisfactory.

H. Segment-wise or Product-wise performance

The Company operates in single Segment i.e. Trading and distributors

J. Caution Statement:

Statements made in the Management Discussion and Analysis describing the various parts may be “forward looking statement” within the meaning of applicable securities laws and regulations. The actual results may differ from those expectations depending upon the economic conditions, changes in Govt. Regulations and amendments in tax laws and other internal and external factors.

Registered Office:
3A Mangoe Lane 1st Floor Surana House
Na Kolkata WB - 700 001
Place: Kolkata
Date: 5th September, 2023
By the Order of the Board of
Svarnim Trade Udyog Limited
Sd/- Sd/-
Surbhi Aggarwal Sangeeta Aggarwal
Director Director
DIN: 08409763 DIN: 10252827