toyama electric ltd Management discussions

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

1. INDUSTRY STRUCTURE AND DEVELOPMENTS:

The global recession has had an impact on our economic growth. The slowdown in the real estate sector due to continuous increase in interest rates and escalation in cost of inputs the industrial sector growth particularly in the industry in which your company operates is not impressive. This phase is likely to continue in the current year.

2. OPPORTUNITIES AND THREATS:

With the size and population of a country like India the opportunities in the housing sector are continuous. The current situation in infrastructure and investments are also indicating a slow down for this industry. The threat is corning in from the MNCs in this segment and also the mushrooming of small players who operate at lower duties make this industry highly competitive.

3. SEGMENT WISE PERFORMANCE;

Particulars	Sales(In Units)		Sales(ln Rs)
	2011-2012	2010-2011	2011-2012	2010-2011
Writing, Accessories &Electro Mechanical Devices	2485328	2659685	69410911	80770093

4. OUTLOOK

The company is hopeful of reasonable growth for the current year. It is also its endeavor to benchmark and upgrade its products to match the onslaught of MNC competitors. The Company is also on the lookout for export Manufacturing and trying to explore avenues for the same.

5. RISKS AND CONCERNS:

In Electro mechanical devices, obsolescence of designs are becoming faster. The turn time for new products is falling, which is a grave risk.

6. INTERNAL CONTROL AND SYSTEMS:

The Company has adequate system of internal controls to ensure accuracy of records and compliance with statutory laws and guidelines prescribed by the management.

An independent firm of Chartered Accountants also carries out an internal audit.

Financial performance with respect to Operational performance;

PARTICULARS	2011-2012	2010-2011
Sales (Rs in crores)	7.25	7.97
Profit before Tax(Rs in lakhs)	-13.42	26.51

Despite stiff competition and sluggish market conditions your company could achieve a turnover of Rs.7.25 crores. However, due to increased input costs and overheads there is a marginal loss of Rs. 13.42 lakhs.

8. HUMAN RESOURCES:

The Company is continuously trying to enhance its human resources. Training programmes were conducted in the manufacturing side. On the selling front a lot of programs were conducted for enhancing the selling skills of the sales team. The Company is working in the current year to work on an effective sales management program for its middle level managers.

CEO & CFO CERTIFICATION

A. We have reviewed the financial statements and the cash flow statement for the year ended 31st March, 2012 and certify that to the best of our knowledge and belief, that:

I. These documents present a true and fair view of the Companys affairs and are in compliance with the existing Accounting Standards, applicable laws and regulations.

II. These statements do not contain any materially untrue statement or omit any material fact or contains statements that might be misleading

III. No transaction entered into by the Company during the year were fraudulent, illegal or violative of the Companys code of condu ct and no instances of fraud took place;

IV. We accept responsibility for establishing and maintaining internal controls for financial reporting.

V. We have evaluated the effectiveness of the internal control systems of the Company, and have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of internal controls, if any of which we are aware and have taken steps to rectify the same, wherever found.

VI. Significant changes in the internal control over financing reporting as well as changes in accounting policies, if any have been intimated to the auditors and the auditors and the Audit Committee and been disclosed in the notes to the Financial Statements.

B. We further declare, in compliance to clause 49, (D) (ii) to Listing Agreement, that all the members and senior management. personnel have affirmed compliances with the code of Conduct of the Company.

	For Toyama Electric Limited
	S/d
	Chairman& Managing Director

AUDITORS REPORT ON CORPORATE GOVERNANCE

To the members of TOYAMA ELECTRIC UMTTED Bangalore

We have examined the compliance of conditions of Corporate Governance by TOYAMA ELECTRIC LIMITED Bangalore for the year ended 31st March 2012 as stipulated in clause 49 of the listing agreement of the said company with stock exchanges in India.

The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination was limited to procedures and implementation thereof adopted by the company for ensuring the compliance of conditions of corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the company,

In our opinion and to the best of our information and according to the explanations given to us we certify that the company has complied with the conditions of corporate governance as stipulated in the above mentioned listing agreement.

We state that no investor grievance is pending for a period exceeding one month against the company as per the records maintained by the Share-Registrars and reviewed by the Shareholders/ Investors* Grievance Committee.

We further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the management has conducted the affairs of the company.

	For K.S.AIYAR & CO
	Chartered Accountants
	Firm Registration Number 100186W
Bangalore.	Ramamohan Hegde
28-May-2012	Partner
	M. No. 23206