Vinny Overseas Ltd Management Discussions

INDUSTRY OVERVIEW:

The Domestic Home Textile industry in India continues to build momentum, driven by sustained growth in organized retail, rising urbanization, and favorable economic conditions. In FY 2023-24, demand for home textiles has surged, further supported by a strong post-pandemic recovery in consumer spending. The continued success of GST in streamlining tax structures has further minimized the influx of cheap imports, benefiting organized players. E-commerce and Modern Trade remain pivotal, offering competitively priced private labels that attract value-conscious consumers. However, premium consumers are showing an increasing preference for eco-friendly, sustainable, and innovative high-end fabrics, reflecting global trends towards sustainability. The market continues to distinctly cater to both value-led consumers and fashion-conscious buyers, with the latters demand shifting towards ethically sourced, luxury products. Additionally, geopolitical shifts and supply chain adjustments have influenced domestic manufacturing, bolstering the "Make in India" initiative and promoting local brands.

COMPANY AND ITS BUSINESS STRUCTURE:

During the financial year 2023-24, your company continued to focus on its core competency of fabric processing, catering to both domestic and international markets. We have strengthened our position by leveraging advanced technology and optimizing our processes to meet evolving customer demands. Our business model, primarily based on job processing of fabrics, remains agile, enabling us to efficiently manage fluctuations in demand and supply within the textile commodities market. With an increased emphasis on sustainability and innovation, we have enhanced the properties and quality of fabrics to meet global standards. Each operational stage remains self-sufficient, with a strong managerial framework and timely corporate support to ensure seamless functioning. Total customer satisfaction continues to be at the heart of our operations. Through a customer-centric approach, we focus on delivering value by offering high- quality, customized fabric solutions. Our skilled workforce adheres to stringent quality standards, and continuous product innovation has allowed us to develop technical solutions tailored to specific customer needs, contributing to long-term success and mutual growth.

Cost-Effective and Skilled Manpower: India continues to benefit from a vast pool of skilled and cost-effective labor, providing a significant competitive edge in the global textile market.

Integrated Textile Value Chain: The industry boasts a vertically and horizontally integrated value chain, encompassing everything from raw material sourcing to the production of finished goods. This integration enhances efficiency and quality control.

Nationwide Competitive Textile Processing: With textile processing units spread across the country, India offers a diverse and competitive design base that caters to a wide range of consumer preferences in both domestic and international markets.

Modern and Efficient Manufacturing Facilities: Investments in advanced technology and modernization of manufacturing facilities have led to increased efficiency and reduced processing costs, particularly in grey fabric processing, solidifying Indias position as a cost leader.

Growing Domestic and International Markets: The robust growth of the Indian economy, coupled with rising consumer spending, has expanded the domestic market. Additionally, strong demand in international markets offers significant opportunities for export growth.

Adoption of Sustainable Practices: The industry is increasingly embracing sustainable and eco-friendly manufacturing practices, aligning with global trends and enhancing its appeal in markets that prioritize environmental responsibility.

Government Support and Initiatives: Continued government support through policies like the Production Linked Incentive (PLI) scheme and the "Make in India" initiative has created a favorable environment for investment and growth in the textile sector.

BUSINESS OVERVIEW (2023-24)

Vinny Overseas Limited, established in 1992, continues to be a recognized name in the manufacture and processing of textile fabrics. Over the years, the company has strengthened its position in the Textile Processing Industry by maintaining a loyal clientele, including multinational corporations. In FY 2023-24, we have further solidified our presence in the domestic market, ensuring Pan-India distribution of our products. Our ongoing focus on quality, innovation, and customer satisfaction has enabled us to sustain growth and meet the evolving needs of our clients across the country.

OPERATIONAL PERFORMANCE:

Your Directors have been making efforts on all fronts viz. production, marketing, finance and cost control, etc. and these efforts have been yielding good results. The outlook for the Companys products appears to be good and the Company is confident of achieving improved operational performance.

The company has recorded total revenue from operations during the financial year Rs. 11,271.35 Lakhs as against 10641.51 Lakhs in the previous year.

• The company has recorded total revenue from operations during the financial year Rs. 11,271.35 Lakhs as against 10641.51 Lakhs in the previous year.

• the company has made profit of Rs. 354.45 Lakhs while in previous year the company had made profit of Rs. 240.73 Lakhs.

• The total expense of the company during the year is Rs. 10,907.87 Lakhs against the expense of Rs. 10321.97 Lakhs in the previous financial year.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has implemented a comprehensive system of internal financial controls with reference to financial statements, ensuring adherence to regulatory and compliance standards. The accounting policies adopted by the Company are consistent with the Accounting Standards outlined in the Companies (Accounting Standards) Rules, 2006, and as applicable under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014. These policies are aligned with generally accepted accounting principles in India. Any changes in accounting policies are reviewed and approved by the Audit Committee, in consultation with the Auditors.

The Company has established a sound system of internal audit and controls to safeguard assets from unauthorized use or disposition, while ensuring that all transactions are duly authorized, properly recorded, and accurately reported. To enhance the effectiveness of these controls, the Company continuously reviews and improves its practices across all major functional areas.

The internal audit function is outsourced to an independent firm of Chartered Accountants, ensuring objectivity and rigor in the audit process. Regular audits are conducted, and all significant findings and recommendations are presented to the Audit Committee for review. The management ensures that the recommendations made by the internal auditors are implemented in a timely manner and periodically reviews the effectiveness of these internal controls, further strengthening the governance framework.

FINANCIAL PERFORMANCE AND ANALYSIS

During the year under review, the net revenue from operations increased by 5.92% from 10641.51 Lakhs to 11271.35 Lakhs. The Company has made profit before tax of Rs. 434.68 Lakhs as compared to profit of Rs. 340.25 Lakhs in previous year. Consequently, net profit after tax for the year has stood at Rs. 354.45 Lakhs as against profit of Rs. 240.73 Lakhs in the previous year.

HUMAN RESOURCE DEVELOPMENT/ INDUSTRIAL RELATIONS

Your Company continues to have cordial and harmonious relations with its employees at all levels during the period under review. The Company also puts emphasis on formal training and development programmes to operators and workers, as a core activity and provides continuous training, both internally and externally, for the upgradation of employee skills. The operations of the Company across functions have been strengthened through the induction of appropriately qualified and experienced manpower.

Management identifies the potential of each employee and endeavors by providing them right opportunity to grow. Management of your Company strongly focuses on the performance of the managers. The Board acknowledges its thanks to all the works floor personnel and other employees for making significant contribution to your Company.

The Company considers its employees as the most important asset and integral to its competitive position. It has a well designed HR policy that promotes a conducive work environment, inclusive growth, equal opportunities and competitiveness and aligns employees goals with the organisations growth vision. Its human resource division plays a crucial role to build a strong and talented workforce. It provides opportunities for professional and personal development and implements comprehensive employee engagement and development programmes to enhance the productivity and skills of its employees.

Our positive approach to competency, development and retention allows attracting, retaining and built the best team. The Company attaches priority to human resource development, with focus on regular up-gradation of the knowledge and skills of our employees and equipping them with the necessary expertise to meet the challenges of change and growth successfully. Industrial Relations were cordial and satisfactory.

KEY FINANCIAL RATIOS

In accordance with the amended SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Company is required to give 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 thereof:

The Company has identified following ratios as key financial ratios

CAUTIONARY STATEMENT

Statements in this report on Management Discussion and Analysis relating to the Companys objectives, projections, estimates, expectations or prediction may be forward looking within the meaning of applicable securities laws and regulations. These statements are based on certain assumptions and expectations of future events. Actual results might differ materially from those expressed or implied depending upon factors such as climatic conditions, global and domestic demand- supply conditions, raw materials cost, availability and prices of finished goods, foreign exchange market movements, changes in Government regulations, tax structure, economic and political developments within India and the countries where the Company conducts its business and other factors such as litigation and industrial relations. The Company assumes no responsibility in respect of forward-looking statements herein which may undergo changes in future on the basis of subsequent developments, information or events.