vikram thermo india ltd Management discussions

1. OVERALL REVIEW ON INDUSTRY STRUCTURE & DEVELOPMENTS:

The Company is in Pharmaceutical industry. The Company is leading in manufacturing and selling of basic Pharma CoPolymer Drug Coat, Diphenyl Oxide, etc.

The Company is a dynamic futuristic public limited company involved in manufacturing, marketing and export of pharmaceutical excipients and chemicals since 1985. The Company owns three well established brands DRUGCOAT, DRCOAT, APION, AQUAPOL and DPO-Diphenyl oxide. The overall performance during the financial year 2022-23 has been progressive.

• CREDENTIALS:

The Company is having EXCIPACT, Good Manufacturing Practice, ISO 9001:2008 and Halal certificate and many multinational company audit approval enabling pharmacopeial GMP quality product manufacturing in India. Vikram Thermo (India) Limited also filed US-DMF for its products.

• RESEARCH & DEVELOPMENTS:

The Company have strong R&D and Application F&D team, with vast experienced and qualified pharmacists, research scientist, chemist & chemical engineers to develop various polymers in pharmaceutical & cosmetic applications.

" INFRASTRUCTURE:

Vikram Thermo (India) Limited have dedicated plant at two different locations for manufacturing Aromatic Chemical and EXCIPACT GMP standard pharma polymers.

2. OPPORTUNITIES AND THREATS: Opportunities

• India has a long tradition of chemical activities and a very strong Pharmaceutical Industry which is growing at rapid pace which shall directly help the Companys revenue to grow in foreseeable future.

• India has abundant supply of highly skilled manpower, scientists and technical personnel for which the salaries are considerably lower than the same in developed nations.

• The capital cost for setting up a decent world class facility is fraction of what it would cost in Western Countries. This makes the Indian Companies at the competitive position in the international markets.

Threats

• Import of goods from some of the large global sized plants may add to the competition for the Companys Products.

3. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE:

On the basis of the principles for determination of segments given in Indian Accounting Standard 108 "Operating Segments" and in the opinion of management, the Company is primarily engaged in the business of manufacturing of "Chemicals". All other activities of the Company revolve around the main business and as such there is no separate reportable business segment. However, the company has identified geographical segment as its secondary business segment, the details are as follows:

Particulars	India (Rs. In lakhs)		Rest of the world (Rs. In lakhs)		Total (Rs. In lakhs)
	2022-23	2021-22	2022-23	2021-22	2022-23	2021-22
Segment Revenue	8511.24	7660.50	2642.83	1596.97	11,154.07	9,257.47
Segment Assets	6676.92	5529.61	Nil	Nil	6676.92	5529.61
Additions to Property, Plant	1038.41	2391.79	Nil	Nil	1038.41	2391.79
&Equipments including
intangible Assets

There is no transaction with single customer which amounts to 10% or more of the Companys revenue.

4. BUSINESS OUTLOOK:

The Company has achieved polymer excellence by Discovery, Development, Manufacturing and Marketing of research based products since last three decades this POLYMER EXCELLENCE Led Ready -To-Use Coating System - DRCOAT. The Company provides complete solution for various applications in solid oral dosage coating segment with complimentary technical support.

The Company have both range of products basic pharma polymers as well as ready-mix coating products.

5. RISK AND CONCERN:

The companys raw materials are based on petrochemicals. Major fluctuations in the petroleum products can affect the companys performance.

6. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

Considering the size of the company, your company has adequate system of internal control to provide reasonable assurance that assets are safeguarded and protected from unauthorized use or deposition. The management continuously reviews the internal control systems and procedure for efficient conduct of business. A strong system of internal audit committee of the Board has strengthened the internal control within the organization.

7. FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE.

Total turnover for the year ended on 31st March, 2023 was Rs. 11,154.07 lacs. It was mainly on account of improvement in manufacturing techniques and sales promotion drive. Better working capital management was also one of the emphasis on which proper weight age was laid upon.

8. HUMAN RESOURCE DEVELOPMENT:

Your Company treats its "Human Resources" as one of its most significant assets. The Company continues its focus on retention through employee engagement initiatives and provides a holistic environment where employees get opportunities to realize their potential. A number of programs that provide focused people attention are currently underway. Your Companys thrust is on the promotion of talent internally through job rotation and job enlargement. The Companys Health and Safety Policy commits to provide a healthy and safe work environment to all employees.

9. DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED EXPLANATIONS THEREFOR, INCLUDING:

Ratio	2022-23	2021-22
Debtors Turnover	30.93	26.41
Inventory Turnover	10.34	9.73
Interest Coverage Ratio	14.46	9.84
Current Ratio	2.22	2.53
Debt Equity Ratio	0.21	0.20
Debt Service Coverage Ratio	7.34	2.93
Return on Equity Ratio	0.21	0.14
Return on Capital Employed (%)	26.89%	17.05%
Operating Profit Margin (%)	23.53%	15.72%
Net Profit Margin (%)	15.16%	9.39%

The debt service coverage ratio has increased due to increase in the profit after tax as well as decrease in the debts as the company has not borrowed any debts during the year.

The inventory turnover ratio is decreased due to increase in sales.

The interest coverage has increased as the finance cost has been increased and Net profit of the company has been increased as compared to the last year.

Due to Repayment of Term loan which results into lower debt equity Ratio. Due to increase in sales operation, the operational profit margin has increased.

As Sales of product are at an efficient margin which leads to higher net profit margin as compared to last year. During the year raw material prices are reduced and revenue from operation is increased, so it results into increased in the Return on Capital Employed.

10. DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR

ALONG WITH A DETAILED EXPLANATION THEREOF

The return on net worth during the current financial year was 18.86% compared to 11.83% achieved during the previous financial year. There was increase in profitability of the company in comparison to the previous year.

11. BUSINESS ENVIRONMENT:

The Performance of the company for the year under review was satisfactory.

12. CAUTIONARY STATEMENT:

Statements in this report on Management Discussion and analysis may be forward looking statements within the meaning of applicable security laws or regulations. These statements are based on certain assumptions and expectations of future events. Actual results could however, differ materially from those expressed or implied. Important factors that could make a different to the Companys operations include global and domestic demand supply conditions, finished goods prices, raw material cost and availability and changes in government regulation and tax structure, economic development within India and the countries with which the company has business contacts and other factors such as litigation and industrial relations. The Company assumes no responsibilities in respect of forward looking statements which may be amended or modified in future on the basis of subsequent developments, information of event.

PLACE: AHMEDABAD	BY THE ORDER OF THE BOARD OF DIRECTORS,
DATE: 11/08/2023	FOR, VIKRAM THERMO (INDIA) LIMITED
	Sd/-
	MR. DHIRAJLAL K PATEL
	CHAIRMAN & MD
	(DIN: 00044350)