uniphos enterprises ltd Management discussions


INDUSTRY STRUCTURE AND DEVELOPMENT:

The Company is engaged only in trading in chemicals.

SEGMENT WISE PERFORMANCE:

The Company operates in a single segment, viz. trading in chemicals. During the year, the Company traded in chemical of Ethylenediamine totaling to 147.19 lakhs.

BUSINESS OUTLOOK:

The Company continues to look at new opportunities of trading in chemicals in India.

The Companys revenue is mainly from other income consisting of dividend on equity shares and interest on loans. The financial asset of the Company is mainly investment in listed security and accordingly, any material volatility in the capital market may impact the market value of the investment.

RISKS AND CONCERNS:

Key business risks perceived by the Company and mitigating initiatives are as under:

Funding risk:- As there are no much activities in the Company, the Company may not be able to mobilize adequate funds, if any, in time. The mitigating factors are that the Company has good investment in the quoted shares, so raising additional funds, if any, will not be difficult for the Company.

Regulatory risk:- Any change in Government / Regulators Policy / Rules / Regulations will require fresh compliances. The mitigating factors are that the group has very strong and dedicated team consisting of professionals to study regulatory changes and fresh requirement.

Foreign currency fluctuation risk: – The Company is engaged in the trading activities, which may subject to risk of less profit / loss on account of volatility in foreign currency exchange. The mitigating factors are that the management ensures to enter in trading transactions in such a way that there are minimal risks of volatility in foreign currency exchange or the Company may take adequate forward cover for foreign exchange fluctuations.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The Company has an internal control system, commensurate with the size, scale and complexity of its operation. The Group has an inhouse internal audit team headed by a qualified professional, which undertakes internal audit and ensures that all transactions are authorized and recorded in the books of the Company. The internal audit department monitors the efficacy and adequacy of internal control. Significant audit observations, if any, are presented to the Audit Committee and action taken to correct any deficiency is informed to them. The report prepared by internal audit team forms the basis of utilization by the Managing Director and Chief Financial Officer for financial reporting as required under Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Company has adequate internal financial controls in place, commensurate with the size, scale and complexity of its operations. The Company is complying with all the applicable Accounting Standards. The accounting records are maintained in accordance with generally accepted accounting principles in India. This ensures that the financial statements reflect true and fair financial position of the Company.

FINANCIAL AND OPERATIONAL PERFORMANCE:

During the year, the Company traded in chemical of Ethylenediamine totaling to 147.19 lakhs. Other income was 4308.64 lakhs as compared to 5709.73 lakhs in the previous year. The Company has earned profit of 3922.54 lakhs after tax as compared to profit of 5460.37 lakhs in the previous year.

HUMAN RESOURCES DEVELOPMENT:

The relationship with the employees continued to be cordial throughout the year.

DISCLOSURE OF ACCOUNTING TREATMENT:

This has been dealt with in the Directors Report.

CAUTIONARY STATEMENT:

Certain statements in this section relating to estimates, projections and expectations may be forward looking within the meaning of applicable laws and regulations. The actual results could differ materially from what the directors envisage in terms of the future performance and outlook. The factors that may affect the performance of the Company will be drought or shortfall in rains, change in