undefined share price Management discussions



The Indian economy displayed speedy and steady growth over the last year on the back of various Government initiatives and reforms and challenges faced due to Corona virus (COVID-19) and lockdown. The growth outlook was optimistic prior to the unexpected COVID-19) outbreak. The outbreak of second wave and extension of relief package in various forms has increased the budget deficiL Owing to the massive impact of COVID-19, all the major economies of the world have gone through some form of lockdown or social distancing. But mankind buckled up and pooled the resources together and our frontline warriors fought hard, and various Government vaccination programmes proved to be major success in Tight against this unprecedented outbreak. The Central government declared the Gross Domestic Product (GDP) for the financial year 2021-22 stands at 8.7 per cent. Indias economic growth in the current year is estimated to be 9.2 per cent, highest among all large economies. For 2022-23, the Reserve Bank of India (RBI) has projected Indias GDP growth rate to be 7.2 percent.

The Government has implemented various measures including free vaccination drive other economic and essential reforms to overcome from the impact of this outbreak and accelerate the growth, These measures were not limited to preventive health care and vaccination doses but also to extend economic impact such as reduction in repo rates etc. During the FY 2021-22, Government Announced stimulus package of Rs. 6.29 lakh crore to boost all sectors and all classes of society and to increase liquidity, support and infrastructure which will also help weaker section to reduce the impact of economic slowdown due to the second wave.


The Govt, of India has taken various significant monetary and liquidity measures to mitigate the adverse impact of COVID-19 and in order to mitigate and boost the economic activities. The announcement of stimulus package expects to foster long-term employment and opportunities that will strengthen the economy further in coming years. After the successful implementation of vaccination drives, the Indian economy was ready to get back in the race in short period of time. The Company expecting an accelerated growth in business in coming years.


The domestic plastic pipes industry size is estimated at Rs. 315 billion; of which the organized players account for 60% of the market share. Although the pandemic caused most sectors to evaluate how they operate, the construction industry landed itself a unique opportunity to innovate and grow. Organized players have topped industry growth as they continue to gain market share from unorganized manufacturers. The integration in the PVC pipe market is expected to accelerate. With limited supply and rising PVC resin costs, the regional and unorganized players are expected to face significant sourcing and working capital challenges in the coming years. The major driver leading to growth is Government infrastructural spending, irrigation sector, replacement of aging pipelines, increasing constructions and industrial production among others. There has been growing adoption in PVC/CPVC pipes owing to its easy installation, corrosion and flame resistant, environmentally sound and durability.


The unorganized players in the plastic pipes industry were already finding it difficult to gain advantage on the price and market outreach. After the COVID-19 scenario, the companies with high debt and weak cash flow are bound to head towards consolidation resulting in leading of market by organized players with opportunities to acquire regional players at lower valuation.


Har Ghar Nal Se Jal: The Government of India covered 8.7 Cr households under this scheme, out of which 5.5 Cr households were provided tap water in the last two years. Further, the government plans to allocate H 60,000 Cr to provide potable water to another 3.8 Cr households in FY 2022-23 under the Har Ghar Nal Se Jal programme.

It is very appreciating and praiseful to know that your Companys registered and place of operations i.e. Burhanpur in Madhya Pradesh becomes the first "Har Ghar Jal" certified district in the country, reaching from just 37% households of tap water connections in August, 2019 to 100% in less than three years under the collective effort and spirit of work of Govt, of India, MP Govt, and Jal Jeevan Mission.

Pradhan Mantri Krishi Sinchai Yojana (PMKSY): The government aims to enhance rural prosperity by enhancing water availability to all agricultural farms, leading to higher production and productivity.


Cost of raw material

The raw material prices increases to a great extent in this financial year also and the production cost of the players operating in the industry also affected a lot. Moreover, the increase in raw material prices impact the end users and pipe manufacturing players, as the cost is to be passed down to the downstream industry users.

Risk Management

The Company has in place an effective risk management framework to primarily control business and operational risks. The major risk areas are systematically and periodically reviewed by the senior management. At various levels, comprehensive policies and procedures will help to identify, mitigate and monitor risks. By taking such proactive measures, the Company ensures that strategic business objectives are achieved seamlessly in a steady and efficient manner. During the financial year under review, rating for fund based facilities of the Company has been upgraded and revised from BWR BBB to BWR BBB+. Further, your Company has an intricate Risk Management procedure which depicts business risk and operational risks that are supported by policy framework.

Human Resource

The Human Resource division of the company plays a vital role in hiring, training, managing and retaining employees to build a group of talented workforces. So that they can reach their full potential and work diligently towards the growth of the organization. The Company has created a level playing field space, whereon equal opportunities to all employees is provided. With this belief, it has enhanced employee morale, boosted productivity and reduced people absenteeism. As of March 31, 2022, the Companys total work force is 420 employees.

Product Wise Performance

Companys major products are PVC, HDPE, Fittings and Trading. Performance of various products at a glance is as under:-

(Rs. In lakhs)
Particulars 2021-22 2020-21
HDPE Pipe 32.913.81 20.680.56
PVC Pipe 14.518.36 12,716.61
CPVC fitting 1.175.80 938.41
Moulding fittings 3.662.88 3.845.10
Roto Water Tank 59.65 -
RM Compound Sale 742.18 2.087.41
Trading Sale 2.889.37 1.897.58
Total 55.962.05 42,165.68
Add Sales of Services 479.47 528.81
Less excise duty - -
Add Sell Fit Charges _
VAT/CST subsidy for Industrial promotion . .
Installation Charges -
Total revenue from operation as per audit report 56,441.53 42,694.49

Note: - The Previous year figures have been regrouped/ reclassified wherever necessary to make them comparable with current periods figure.

Internal Control System and their adequacy

The Company considers that internal control is one of the key supports of governance which provide freedom to the management within a outline of appropriate checks and balances. Texmo Pipes and Products Limited have a strong internal control framework, which was instituted considering the size, nature and risk in the business. The Companys internal control environment provide assurance on efficient conduct of operations, security of Assets, prevention and detection of frauds/errors, accuracy and completeness of accounting records, timely preparation of authentic financial information and compliance with applicable laws and regulation. The Company uses SAP - Enterprise Resources Planning software as its core IT system. The Internal Auditor is a Chartered Accountant has been entrusted the job to conduct regular internal Audits at all the units/Branches and report to the management the lapses, if any and submitted Report on quarterly basis to the Board of Directors for their review and comments. To ensure efficient Internal control system, the Company has a well constituted Audit committee who at its periodical meeting, review the competence of internal control system and Procedures thereby Suggesting improvement in the system and process as per the changes of Business dynamics. The system and process are continuously improved by adopting best in class processes, automation and implementing latest IT tools.

Discussion on Financial Performance with respect to operational performance

On a standalone basis your company recorded a turnover of Rs. 56,441.53 Lakhs for the year ended 31J March, 2022 as against Rs. 42,694.49 Lakhs in the previous year which shows an increase of 32.20 %.

On a standalone basis, the profit before interest, depreciation and tax for the financial year is Rs. 3,357.42 Lakhs as against Rs. 2,582.94 Lakhs recorded in the previous year. The profit before tax for the financial year stood at Rs. 1,968.84 Lakhs compared to Rs. 1,440.79 Lakhs of the previous year. The profit after tax & exceptional item for the financial year at Rs. 1.460.91 Lakhs compared to Rs. 1,123.08 Lakhs of the previous year.

On a standalone basis your company recorded Production of 38,623.22 MT for the year ended 31 March, 2022 as against 36,115.66 MT in the previous year which shows an increase to 6.94%.


Details of significant changes, i.e., change of 25% or more, as compared to the immediately previous Financial Year in key financial ratio, along with detailed explanation therefore:

Sr. No. Particulars Ratio as Ratio as %of Explanationon, if any
i. Debtors Turnover 12.67 9.65 31.25% Due to Increase in Turnover
ii. Inventory Turnover 9.44 6.62 42.69% Due to Increase in Turnover, & Decrease in Inventories


Details of change in Return on Net Worth as compared to the immediately previous Financial Year as ollows:

Sr. No. Particulars Ratio as on 31 March 2022 in Ratio as on 31 March 2021 in % of Change Explanations
i. Return on Net Worth 12.04% 10.52% 14.49% Due to Price Fluctuation of FG & RM. Due to Increase of Sales

Cautionary Statement

Some of the statements in this Management Discussion and Analysis, describing the companys objectives, projections, estimates and expectations may be forward looking statements within the meaning of applicable Laws and Regulations. Actual results might differ substantially from those expressed or implied. Important developments that could affect the Companys operations include changes in economic conditions affecting demand, supply and price movements in the domestic and overseas markets in which your company operates changes in the Government regulations, Tax Laws and other Statutes or other incidental factors. The company assumes no responsibility in respect of forward-looking statements, which may be amended or modified in future.