Titagarh Steels Ltd merged Management Discussions

TITAGARH STEELS LIMITED ANNUAL REPORT 2008-2009 MANAGEMENT DISCUSSION AND ANALYSIS (a) Industry Structure and Developments: The Engineering Industry to which your Company belongs, is one of the key sectors in the economy for industrial development of the country. Retaining the high quality, backed by ISO 9002 accreditation by RWTUV, Germany and most economical utilization of resources are considered to be favorable factors for the performance of the Company in future. (b) Opportunities and Threats: The performance of your Company has a direct relationship with the specific sectoral development i.e. goods traffic of the Indian railway. The market has witnessed positive growth, which is corelated with the performance of the Company. However, in view of stiff competition amongst the participants, margin of safety depend on internal cost economies along with efficiency in operations. (c) Segment-wise or Product-wise performance: The Company is operating in a single product segment, viz. Steel Casting. (d) Outlook In view of the present railway traffic position, it is expected that the Government will procure good numbers of railway wagons, which if happens, will help the Company to improve its performance to a great extent. (e) Risks and Concerns The performance of your Company is closely linked up with the quantum of order for railway wagons released by the Indian Railways. Any major dispersion in the procurement program of the Government will have an impact on the performance of the Company. (f) Internal Control Systems and their adequacy The Company has adequate internal control system to take care of its operations which in the opinion of the Board of Directors is commensurate with the nature and size of business of the Company. The Internal Auditor of the Company is regularly carrying out auditing in all the key areas of the operations. Additionally the Audit Committee is reviewing all Audit Plans and Reports with significant control issues raised by internal and external audit.. Regular Reports on the Business Development of the past and future plans are given to the Board of Directors. Internal Audit Reports are regularly circulated for perusal of senior Management and issuance of appropriate directives to comply with the findings. (g) Discussion on financial performance with respect to operational performance The operations of the Company were impacted by Slowdown in the economy. However, the Company follows good management practices to bring improvement in the performance. (h) Material developments in Human Resources/industrial Relations front, including number of people employed The Company values continuous training and development of the human resources with the objective of promoting a professional and productive culture. The Company is maintaining good employee relations and no man-days were lost during the year due to employees unrest. The Company has 231 employees as on 31st March, 2009.