Vivanza Biosciences Ltd Management Discussions.

> INDUSTRIAL STRUCTURE:

The Company is in business of trading of Pharmacy products. However Competition in the industry is continuously increasing. Further, the Company has also set its vision in global market to supply and execute turnkey pharmaceutical units.

> OPPORTUNITIES, THREATS AND OUTLOOK

The Company will be able to place itself in a strong position by expanding strategicallyand enhancing capacities across the organization. The Company is looking at different opportunities in untapped markets and also across a value chain. It plans for alliances with business associates in the global market, giving a huge boost to the selective products that it already deals in.

We are fully conscious of our responsibility toward our customers. Our efforts are directed toward the fulfillment of customer satisfaction through the quality of products. As the consolidation of this industry gains momentum, the need to develop a dedicated team of skilled manpower assumes urgency and importance.

We will continue to focus on training and motivation of manpower so as to develop teams of qualified and skilled personnel to effectively discharge their responsibilities in a number of projects and activities. It is, in this context, which we have been working towards promoting the skills and professionalism of our employees to cope with and focus on the challenges of change and growth.

> OVERVIEW:

The Companys financial statements have been prepared in accordance with Indian Accounting Standards (INDAS), complying with the requirements of the Companies Act 2013 and the guidelines issued by Securities and Exchange Board of India (SEBI).The management of the company accepts responsibility for the integrity and objectivity of these financial statements, as well as for various estimates and judgments used therein. The estimates and judgments relating to the financial statements have been made on a prudent and reasonable basis, in order that the financial statements reflect in a true and fair manner the form and substance of transactions, and reasonably present the companys state of affairs and profit for the year.

COMPETITION:

Competition in the domestic market has intensified and forced the players to adopt aggressive marketing strategy and promotional campaigns to capture and protect their market shares. The Company has the plans to penetrate better in to world market, especially through the customer retention and business development in the regions which have not been tapped.

> SEGMENT WISE AND PRODUCT WISE PERFORMANCE:

The Company operates within a solitary business segment i.e. Trading of Pharmaceutical product. Hence, Segment/Product wise report is not given separately.

> RISK AND CONCERN:

The risk management function is integral to the company and its objectives includes ensuring that critical risk are identified continuously, monitored and managed effectively in order to protect the companys business.

However, the changes in the tax laws, Government policies and regulatory requirement might affect the companys business. Uncontrolled variation in price of input materials could impact the companys profitability to the extent that the same are not absorbed by the market through price increase and/or could have a negative impact on the demand in the market.

The management has already taken initiatives in advance for mitigating the above mentioned risk and concerns/challenges. The company has taken major initiatives like strong marketing efforts, focus on cost reduction through inventory management techniques, introduction of new products and manufacturing process without compromising quality of products and retain talented employees etc.

> INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has strong and adequate internal control system suitable to its size and nature of business. We constantly upgrade our systems for incremental improvements. The Audit Committee of the Board regularly reviews our system. The systems ensure protection of assets and proper recording of transactions. Internal audit is carried out by an independent chartered accountants firm on quarterly basis. The internal auditors reports are regularly received by the Audit Committee. It is a regular practice to review the issues raised by Internal Auditors and statutory auditors by the Audit Committee.

> DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

In terms of performance, FY 2019-20 has been a reasonable year. Company is focussed on the task on hand in terms of better reliability of operations and more focussed market efforts. Our revenue from operations is Rs. 942.90 Lakhs. However, our company has incurred Loss of Rs. 20.38 lakhs. Cash and cash equivalents at the end of year stood at Rs. (281.25) Lakhs.

The details of changes in key financial ratios are explained in the table below:

Ratios FY 2018-19 FY 2019-2020
Debtors Turnover Ratio 0.40129 0.82
Inventory Turnover Ratio 1.059 6. 820
Interest Coverage Ratio (0.07291) 0.4682
Debt Equity Ratio 2.5884 2.2406
Operating Margin Ratio (%) (1.373) (2.045)
Net Profit Margin (%) (20.207) (2.045)

> COVID-19 UPDATE

Currently, the global economic environment is highly unpredictable as the duration and the impact of unprecedented COVID-19 pandemic is difficult to ascertain. we have always put our customers at the heart of everything we do. Amidst one of the most uncertain environment faced today, our employees across locations are relentlessly working towards providing uninterrupted supply of our products. Your Company is ensuring utmost safety of its employees by following measures such as usage of masks/gloves, regular temperature screening, setting up of disinfectant tunnels, maintaining social distancing, allowing limited workforce and conducting comprehensive factory sanitization.

Post the COVID-19 outbreak in mid-March 2020, our operations were disrupted as volumes and sales declined across businesses after the nationwide lockdown announced on March 24, 2020. However, Pharmaceuticals activities were allowed during lockdown and our work became operational in April 2020, after obtaining necessary approvals from local authorities. The demand for our products, remain firm and your Company is taking all necessary steps to ensure smooth supply of products along with maintaining safety of employees and business partners.

> MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT INCLUDING NUMBER OF PEOPLE EMPLOYED

Human Resources of the Company has always acknowledged importance of its human capital and fundamental source of its success. Consequently, the Companys HR department has enabled it to acquire, develop, motivate and maintain its skilled human resource.

The Company worked on its recruitment process at bringing about improvement in: 1. Speed at which talent is brought in.

2. Quality of talent with respect to competence and compatibility.

3. Cost of recruitment

> CAUTIONARY STATEMENT

Certain statement in the management discussion and analysis may be forward looking within the meaning of applicable securities law and regulations and actual results may differ materially from those expressed or implied. Factors that would make differences to Companys operations include competition, price realisation, forex market, changes in government policies and regulations, tax regimes, economic development within India and the countries in which the Company conducts business and other incidental factors.

Place: Ahmedabad

For and on behalf of the Board

Date: July 30, 2020
Bhaskar Bhattacharya Hemant Parikh
Managing Director Director
DIN:07487250 DIN: 00027820