Urja Global Ltd Management Discussions.

1. International Market Overview

Energy can be harnessed directly from the sun, even in cloudy weather. Solar energy is used worldwide and is increasingly popular for generating electricity or heating and desalinating water.

The global solar market grew by 26 percent last year, with 99 gigawatts of grid-connected PV capacity installed. According to GTM Researchs new Global Solar Data Hub, 2018 will be the first-ever triple-digit year for the global solar market, with an anticipated 106 gigawatts of PV coming online.

GTM Research counts 53 national markets where a tendering or auction scheme is currently in place, up from 32 in the second half of 2016. Furthermore, there are an additional 29 national markets where a tendering or auction scheme has been discussed or planned.

2. Indian Solar Market

Renewable energy is fast emerging as a major source of power in India. India is one of the countries with the largest production of energy from renewable sources. In the electricity sector, renewable energy (excluding large hydro) accounted for 20% of the total installed power capacity (69.02 GW) as of 31 March 2018.Indias current model of energy use relies primarily on non-renewable sources of energy, which have limited reserves. Also the country is, to a large extent, dependent on imports to meet these energy requirements, which has been sticky at nearly 35% of its annual primary commercial energy demand over the last several decades. India attains global 4th and 6th position in global Wind and Solar Power installed capacity.

Investment Scenario

Solar sector in India received investments of over US$ 10 billion in CY 2017.

The Asian Development Bank and the Punjab National Bank have signed a financing loan worth US$ 100 million, which will be used to support solar rooftop projects on commercial and industrial buildings across India.

Government Initiatives

The Government of India has identified power sector as a key sector of focus so as to promote sustained industrial growth. Some initiatives by the Government of India to boost the Indian power sector:

In December 2017, a new policy was released for testing, standardization and certification of products used in the renewable energy sector to address quality issues and develop standards as per international practices.

The Government of India has announced plans to implement a US$ 238 million National Mission on advanced ultra-supercritical technologies for cleaner coal utilization.

The Ministry of New and Renewable Energy has decided to provide custom and excise duty benefits to the solar rooftop sector, which in turn will lower the cost of setting up as well as generate power, thus boosting growth.

The Union Cabinet has approved construction of 10 units of indigenous Pressurized Heavy Water Reactors (PHWR), with a nuclear capacity of 700 MW each, which is expected to bring substantial economies of scale and maximise cost and time efficiencies, and thereby boost Indias nuclear industry.

The Indian Railways is taking increased efforts through sustained energy efficient measures and maximum use of clean fuel to cut down emission level by 33 per cent by 2030.

3. Opportunities and Threats Opportunities:

(a) The Department of Economic Affairs, Government of India, signed a guarantee agreement for IBRD/CTF loan worth US$ 98 million and grant agreement for US$ 2 million with the World Bank for shared infrastructure for solar parks project;

(b) In order to lower Indias crude oil imports, the Government of India is going to promote coal gasification to convert high ash coal into methanol that can be used as cooking gas and transportation fuels.

(c) SaubhagyaYojana" programme was launched by Mr.Raghubar Das, Chief Minister, Jharkhand to provide electricity to all 29,376 villages.

Threats:

a) Delay in tendering process of the Government. b) Non-utilization of our available manufacturing capacity. c) The solar market is growing and competition is resulting decline in market share and margins. d) About 70% of Indias electricity generation capacity is from fossil fuels. India is largely dependent on fossil fuel imports to meet its energy demands. e) The shortage of Wafer is artificially escalating their price. f) Fear of poor quality equipment being dumped in India.

4. Future Outlook

India has also raised the solar power generation capacity addition target by five times to 100 GW by 2022. All the states and union territories of India are on board to fulfill the Government of Indias vision of ensuring 24x7 affordable and quality power for all by March 2019. Over 280 million LED bulbs were distributed to consumers in India by Energy Efficiency Services Limited (EESL) under Unnati Jyoti by Affordable LEDs for All (UJALA). The Government of India has been supportive to growth in the power sector.

Solar power in India at current level is already cheaper than electricity generated through diesel. Support from various Central and States Government for solar power industry is continuously increasing.

5. Risks and Concerns

By 2030, Indias dependence on energy imports is expected to exceed 53% of the countrys total energy consumption. Greater import dependence is a threat to Indias energy security as it introduces global market volatility into the mix.About 70% of Indias electricity generation capacity is from fossil fuels. India is largely dependent on fossil fuel imports to meet its energy demands.

The Board of Directors of the Company has formed a Risk Management Committee to frame, implement and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls.

The Company has implemented a Risk Management Policy to have a systematic process to assist in the identification , assessment , treatment and monitoring of risks which provides effective tools to manage the identified risks.

6. Internal control systems and its adequacy

Your Company has an effective internal control and risk mitigation system, which are constantly assessed and strengthened with new/revised standard operating procedures. The Companys internal control system is commensurate with its size, scale and complexities of its operations. The internal audit is entrusted to M/s NVA & Co. a firm of Chartered Accountants. The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry.

7. Financial Performance

During the year under review, the Companys Net Sales were Rs. 1,262,989,142 as against Rs. 1,170,632,505l ast year. Net Profit was Rs. 11,368,067 as against Rs. 10,315,400 last year.

[In 000]
Particulars For the year ended For the year ended
31.03.2018 31.03.2017
Total Revenue 1,279,799.367 1,181,490.180
Total Expenses 1,262,758.365 1,166,022.771
Net Income (I-II) 17,041.002 15,467.409
[In 000]
Particulars For the year ended For the year ended
31.03.2018 31.03.2017
Current 1,531,445.705 585,284.639
Assets
Current 1,291,665.395 356,973.357
Liabilities

8. Human Resource

The overall employee relations were peaceful and harmonious throughout the year. Your Company continued to create a productive, learning and caring environment by implementing robust and comprehensive HR processes.

9. Cautionary Statement

Statements in the Management Discussion and Analysis describing the Companys Objectives and Expectations may be "Forward-Looking Statements" within the meaning of applicable Securities Laws and Regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys Operations include economic conditions affecting demand/supply and price conditions in the markets in which the Company operates, technological obsolescence, changes in the Government Regulations and Policies, Tax Laws and other Statutes and other incidental factors.