Swan Energy Ltd Management Discussions.

(i) Industry Structure and Developments:

Your Company is a diversified player with the presence in Textile, Real Estate and Energy Sectors Energy:

As elaborated in detail in the Directors Report, FSRU Project has achieved various milestones and the work is underway in full speed in order to achieve the completion target of year 2020.

Textile:

During the financial year 2017-18 also, major portion of the ‘Revenue from Operations is from Textile sector. Inspite of tough market scenario, textile sector has continued to contribute steadily and consistently to the topline of the company. The business atmosphere remains almost same as that of last year at both global and domestic level. However, the positive impact of GST still remains to get reflected in the top line. The Company is endeavoring and exploring various strategies to optimize the production capacity at its process house at Ahmedabad.

Real Estate:

Real estate business of the company, being run through two subsidiary companies, is steady and stable. Two properties under CEIPL are yielding decent lease rentals. One residential project is under construction through joint development agreement (JDA) at Bengaluru. On completion, this project is likely to fetch good returns. However, the company is yet to begin the projects on the properties held under PVPL, which has not been possible due to variety of reasons.

(ii) Opportunities, Threats, Risks and Concerns:

Opportunities in all the three sectors are enormous.

Under energy sector, LNG Port Project of FSRU is at advanced stage. Once commissioned, it is likely to outperform all other sectors. The project has tremendous growth potential with provision for doubling its capacity to 10 MMTPA.

Real estate sector, as usual, has tremendous scope and opportunities. The loan on two properties are being repaid through lease rentals and over a period of time, both the properties will become debt free. Your company is working hard to ensure returns from other properties also.

Textile sector is consistently adding to the revenue of your company over a period of years. The brand ‘SWAN is still popular in the market and is expected to increase the revenues of the company manifold.

However, each of the three sectors of the company has inherent threats, risks and concerns, peculiar and applicable to each sector, like, regulatory changes & its uncertainty, rising competition & inflation, international factors, demand supply fluctuations, input cost fluctuations etc.

Your company is well placed to face all of these threats, risks and concerns.

(iii) Segment wise product wise performance:

During the year, 72.91% of the revenue from operations is from Textile sector and remaining is from sale of land at Goa.

(iv) Outlook:

The outlook of the management has always been positive in all the three sectors. The country is attracting huge inflow of money due to diversified factors. The sheer size of population has virtually forced all major players across the world to be present here. Your company expects to reap the fruits in all its three sectors over a period of time.

(v) Internal Control systems and their adequacy:

The internal control systems of your company are adequate and appropriate. It is being reviewed periodically to ensure that the Companys interest and that of the stakeholders is protected. The process of introducing new inbuilt internal checks and controls is continuous depending upon the requirement of the same.

The Audit Committee of the Board reviews the adequacy and effectiveness of the internal controls and checks and suggests desired improvements from time to time.

(vi) Financial and Operational Performance:

Particulars For the year ended 31st March, 2018 For the year ended 331st March, 2017
Sales 31636.18 33080.73
Other Income 11568.53 597.04
Profit before Depreciation and Tax 9678.21 917.15
Depreciation 536.66 541.86
Taxes 1866.94 207.39
Profit/ (Loss) after depreciation and taxes 7274.61 167.90

(vii) Material developments in human Resources/ Industry relations front, including number of people employed:

The Company continues to give utmost importance to Human Resources Development and keeps relations normal. As on 31st March, 2018, there are 146 employees, including 3 whole time directors.

Industrial relations continue to be harmonious and normal.

(viii) Precautionary Statement:

This report contains forward looking statements that address expectations and projections about the future, based on certain assumptions of future events. Companys actual results, performance or achievements may, thus, differ materially from those projected in any such forward looking statements.

For and on behalf of the Board of Directors
Navinbhai C. Dave
Mumbai, 30th May, 2018 Chairman