Tej Infoways Ltd Management Discussions

A. Industry Background

The growth in IT, construction and real estates segment has needs the much needed impetus through major changes in terms of policies and competition in respective industry. India in particular has tremendous thrust in this specific segment as there is obvious pressure required for a developing economy like us. Similarly, the IT sector has several things to invite for overall development.

B. Industry Outlook

The most emerging avenue in one of the core sector in the economic development of the country is still to go a long way with high profile opportunities to all the players in the segment. The growth expectations are very much convincing bearing an intention to promote the every possible participant by means of delegations and sub-delegations. Being the Second year of Companys entry in this sector, the results are encouraging and capable of being driven in to major projects

Though the present IT sector is ruling the entire business world in all aspects, the opportunities to the giants are more as compared to the medium players and new entrants for the reason of daring to pump funds with high risk, establishment of branches at a stretch at global level and absorbing high accomplished talents at best compensation. Surprisingly, the small and new entrants with entrepreneur qualities have also been mesmerized and diverted to work for the big industrialists at no-comparison offer packages. This trend has affected the industry in many ways. In this scenario, your Directors have conceived the plans to face the prevailing situation and better results.

Though there has been phenomenal increase in the construction works floated during the year and in the current year so far both from State and Central Sectors, the offers tendered have been observed to be far below the tender estimated costs giving rise to cut-throat competition levels and in such a scenario, company has been finding it quite difficult to secure orders without compromising adversely on margins.

However we, with our reputation, expect to achieve good orders in the current year and beyond, and endeavor to advance our scope and size of our constructional activities partly by diversifying our efforts as developers for which there is great scope for the next two decades in the infra based sector.

C. Internal Control systems and their adequacy:

The Internal control systems are aimed at promoting operational efficiencies while stressing adherences to policies. The systems are designed with adequate internal controls commensurate size and nature of operations and nature of operations. Transactions are executed in accordance with the companys policies. Assets are safeguarded and deployed in accordance with the Companys Policies.

During the year under review, an Audit Committee consisting of Three Independent and NonExecutive Directors was constituted. The committee is empowered by the Board with the authority to investigate any matters relating to the internal control system. The committee also reviews the quarterly, half yearly and annual financial statements before they are submitted to the Board and ensure compliance of internal control systems.

D. Material developments in human resources/industrial relations:

The Company is able to retain the experienced staff, in spite of the sudden growth of software industry, thereby creating a heavy demand for experienced and trained staff. The Company feels confident of keeping its manpower costs to below industry norms, with the emphasis on becoming customer-centric, the staff are regularly exposed to training & Orientation programmes not a only in their respective fields but also in public relations.

CODE OF CONDUCT

The Company has formulated and implemented a Code of Conduct for Board Members and Senior Management of the Company. Requisite annual affirmations of compliance with the respective Codes have been made by the Directors and Senior Management of the Company.

FIXED DEPOSITS

The company has not accepted any public deposits and, as such no amount on account of principal or interest on public deposits was outstanding on the date of the Balance Sheet.

PERSONNEL

The relations between the management and the staff were very cordial throughout this year. Your Directors take this opportunity to record their appreciation for the Co-Operation and loyal services rendered by the employees.

ACKNOWLEDGEMENTS

The Directors thank the companys customers, vendors, investors, business associates, bankers and other agencies for their support to the company.

We wish to place on record our appreciation for the untiring efforts and contributions made by the employees at all levels to ensure that the company continues to grow and excel.