MANAGEMENT DISCUSSION & ANALYSIS REPORT The Management of Tavernier Resources Limited brsents its Analysis Report covering performance and outlook of the Company. The Report has been brpared in compliance with the requirement of Corporate Governance as laid down in Listing Agreement. The Management accepts responsibility for the integrity and objectivity of the Financial Statements. However investors and readers are cautioned that this discussion contains certain forward looking Statements that involve risk and uncertainties. INDUSTRY STRUCTURE AND DEVELOPMENT The general consensus on global economic growth in the year 2015 remains moderate, with varying prospects across the main markets for gems and jewellery. Overall global economic growth is estimated to be around 3.5 percent in 2015, which is in line with the brvious forecasts. Relative to last year, the outlook for advanced economies is improving, while growth in emerging markets and developing economies is projected to be lower, primarily reflecting weaker prospects for some large emerging market economies and OPEC region. The consumption of gold and jewellery products grew 10-15% per annum over the years, the Indian market is estimated at US$ 30 billion. India boasts of a very competitive gems and jewellery market because of its own production cost, skilled artisans, government incentives and establishment of special economic zones (SEZ). The overall gross exports of gems & Jewellery at US$ 39898.81 million (Rs. 243885.81 crores) is showing a decline of 0.62% in dollar terms and growth of 0.43% in Rs. term as compared to US$ 40147.50 million (Rs. 242837.07 crores) for the period April 2013-March 2014 The overall gross imports of Gems & Jewellery at US$ 31470.78 million (Rs. 192074.99 crores) is showing a growth of 1.29% (2.65% in Rs. term) as compared to US$ 31071.18 million (Rs. 187109.89 crores) for the same period brvious year. This import is reflected through a positive impact on the exports of both plain and studded Gold and silver jewellery, propelling growth for Indian design and manufacturing sector. Discussion on Financial Performance With Respect to Operational Performance During the financial year 2014-15 under review, the turnover of brcious stone increased from Rs. 83.60 Lacs to Rs. 178.52 Lacs whereas the Company has earned Profit of Rs. 312.18 Lacs through dealing in Shares and Derivatives as against loss of Rs. 189.08 Lacs in the brvious financial year. The Profit derived during the year from both the segments was Rs. 254.00 Lacs as against Loss of Rs. 243.69 Lacs. Segment -Wise /Product Wise Performance During the year the Company has two segments i.e Precious Stones and Jewellery and trading in Shares and Derivatives. Outlook The outlook for the diamond industry is expected to brighten in the second half of FY 2015-16. While the demand for bridal jewellery and lower price diamonds remains strong, the volume growth in fashion segment is expected to benefit from the surge in demand in US, India and Middle East. China is also expected to sustain a good rate of demand growth during the year. The management is optimistic of substantial growth in its business operations. Risk and Concerns Your Company has put into place a detailed Risk Management Policy as well as Forex Risk Management Policy. It has tried to identify the various types of risks and integrate risk management activities at all levels in the Company. This includes monitoring all areas of operations including financial transactions continuously. The Company is dealing with high value items and hence has put in place strong systems & procedures to brvent pilferage & theft. It also ensures that its entire inventory, including goods under transit is fully insured at all times. The Company has a strong system of internal audit which not only inspects & audits all its showrooms at regular intervals but also reviews the processes, operational procedures as well as financial disclosures & statements. Foreign Exchange Risk Your company had foreign exchange exposures during the year ended 31st March, 2015. The policy of company is to hedge its long-term foreign exchange risk as well as short-term exposures within the defined parameters. Interest Risk Your company has no loan fund in the year ended 31st March, 2015. The policy of company is to use a judicial mix of fixed and floating rate debts within the stipulated parameters, wherever required. Internal Control System and Adequacy The company has set up an internal control system that functions at various levels of the organization. The system ensures compliance with the respective laws & regulations, efficiency of operations, minimization of wastage, disclosure and adequate reporting of financial transactions, proper administration at all levels of the organization. The Audit Committee of the company periodically reviews and ensures adequacy of the internal control system brvalent at each level of the organization and passes on its recommendation to the management. Human Resources The Company apbrciates that performance level cannot be reached and sustained without the right quality of people. With this belief, the Company has laid significant emphasis on its HR practices. These are concerted efforts to ensure that the most appropriate people are recruited into the organization. Cautionary Statement Statements in the Management Discussion and Analysis Report and in the Directors' Report, describing the company's objectives, projections and estimates, contain words or phrases such as "will", "plan" and similar exbrssions or variations of such exbrssions that are forward looking and progressive within the meaning of applicable laws and regulations. Actual results may vary materially from those exbrssed or implied by the forward looking statements due to risks or uncertainties associated therewith depending upon economic conditions, government policies and other incidental factors. Readers are cautioned not to place undue reliance on these forward-looking statements. On behalf of the Board Sudhir Milapchand Naheta Chairman and Managing Director Place: Mumbai Date : 27th August, 2015 |