MANAGEMENT DISCUSSION & ANALYSIS REPORT 1. INDUSTRY STRUCTURE & DEVELOPMENTS It is a recognized fact that the knitwear sector in the textile industry plays an important role in the Indian Economy. This industry, however, is highly competitive and fragmented. During the year 2013-14 the exports of readymade garments have been reduced substantially and the export growth was severely affected due to several internal and external developments. Stiff Global Competition, Changing Technology & Fashion industry and above all the overall recession continue to have an adverse impact on business prospects and profitability. 2. OPPORTUNITIES & THREATS The opportunities in the Textile Industry and the increasing growth in export of knitted garments augur well for this vital segment. There is a perceptible change in the outlook and shift for diversified and high value added products. Textile Companies are always experiencing pricing brssures, lately due to stiff international competition. Besides, lack of modern technology and archaic personnel laws are some of the other areas of significant threats. Addi Industries is seized of all such factors having adverse effect on its exports. It is always eager and endeavouring to constantly update its plant & equipment for producing the best quality products. A capital expenditure of Nil was incurred during the year on technology upgradation and modernization of machinery & equipment, wherever considered necessary. Sales in Company's domestic retail outlets are gradually improving. Keeping in view the market requirements, new and diversified product lines are continuously being added in the domestic market. 3. SEGMENT-WISE PERFORMANCE The Company operates in one segment only i.e. manufacturing of garments. Hence, no segment-wise performance reporting is available. 4. OUTLOOK Exports in the current year 2013-14 have gone down drastically. The Company has achieved neglible Income from operation of Rs.0.02Lacs (upto 20.05.2014) in the first quarter of the Current Financial Year as compared to the turnover of Rs.11.37 Lacs in the corresponding first quarter of the brvious year. International competition has and is exerting high brssure on selling prices of the export products. Exports also depend a lot on Govt. policies and developments in the international market. 5. RISKS & CONCERNS The Company places its thrust on product excellence. Judicious risk management policies, strong systems, constant monitoring of various risk factors and a focus on greater market penetration continue to guide the business strategy of the Company. Strict monitoring is done to cut-down costs and overheads, whatever feasible, to make the product more prices competitive. Strict monitoring is done to cut-down costs and overheads, whatever feasible, to make the product more prices competitive. 6. INTERNAL CONTROL SYSTEMS The Company has instituted a system of internal control and checks, which are supplemented by an on-going programme of internal audits and Management Information System (MIS). An annual planning and budgeting system has been put into practice. The Audit Committee of the Board actively reviews internal control systems as well as financial disclosures normally on every quarterly period. 7. MATERIAL DEVELOPMENTS IN HR Personal relations during the year under report have been cordial. To conform to international standards, the Company conducts different training programmes in-house. The Company has also identified and included specific programmes on Health, Safety & Environment in every employee/s performance targets. A self assessment system is in vogue amongst the staff, and a code of conduct amongst the senior management personnel, which is reviewed by the top management from time to time. CAUTIONARY STATEMENT The Statements in the Report of the Board of Directors and the Management Discussion & Analysis Report describing the Company's projections, estimates, expectations or brdictions may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those exbrssed or implied since the company's operations are influenced by many external and internal factors beyond the control of the company. For and on behalf of the Board of Directors C.L. JAIN Managing Director (DIN00022903) Place : New Delhi Dated: May 26, 2014 |