AKG Exim Ltd Management Discussions

REPORT

ANNEXURE “V”

This Management Discussion and Analysis report has been prepared in compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and contains expectations and projections about the strategy for growth, product development, market position, expenditures and financial results. Certain Statements in the Management Discussion and analysis report are forward looking statements which involve, a number of risks and uncertainties that could differ actual results, performance or achievements with such forward looking statements on the basis of any subsequent development, information or events for which the Company do not bear any responsibility.

GLOBAL ECONOMY:

Global GDP growth

Global growth is projected to be in line with the April 2024 World Economic Outlook (WEO) forecast, at 3.2 percent in 2024 and 3.3 percent in 2025..

(Source: https://www.imf.org/en/Publications/WEO/Issues/2024/07/16/world-economic-outlook-update-july-2024)

Labour market

The global labour market displays divergent trends between developed and developing countries postpandemic. Developed countries experienced a robust recovery with low unemployment rates, notably 3.7% in the US and 6.0% in the EU in 2023, coupled with rising nominal wages and narrowing wage inequality. However, real income losses and labour shortages pose challenges.

In contrast, developing countries show mixed progress; while nations like China, Brazil, Turkiye, and Russia report declining unemployment, issues like informal employment, gender gaps, and high youth unemployment persist. Globally, the decline in female labor force participation to 47.2% in 2023 (compared to 48.1% in 2013) and the high NEET rate (not in employment, education or training) of 23.5% among youth highlight enduring challenges in gender equality and youth employment.

Since the introduction of ChatGPT in November 2022 there has been significant advancement in artificial intelligence. Within six months ChatGPTs introduction, one-third of firms worldwide were using generative AI for at least one function, and about 40% planned to expand AI investment. The rapid adoption of AI is feared to exacerbate income inequalities. AI could reduce demand for low- skilled jobs, disproportionately impacting women and lower-income countries. In the US, women, who dominate clerical work, are at higher risk of job displacement by AI. Also, theres a significant gender gap in AI professions.

Inflation

Global inflation, a key concern over the past two years, is showing signs of easing. Global headline inflation fell from 8.1% in 2022 to an estimated 5.7% in 2023 and is projected to decline to 3.9% in 2024.

However, food price inflation remains a critical issue, exacerbating food insecurity and poverty, particularly in developing countries. An estimated 238 million people experienced acute food insecurity in 2023, an increase of 21.6 million from the previous year.

Investment

The report also highlights the challenges in global investment trends, with a noted slowdown in investment growth across both developed and developing economies. However, while developed countries have continued to channel investments into sustainable and technology-driven sectors like green energy and digital infrastructure, developing countries face challenges such as capital flight and reduced foreign direct investment. Geopolitical tensions further influence these trends, affecting investment flows regionally.

Global investment growth is expected to remain low due to economic uncertainties, high debt burdens, and rising interest rates. Investment in the energy sector, especially in clean energy, is growing but not at a pace sufficient to meet the net-zero-emissions goal by 2050.

Trade

International trade is losing steam as a growth driver, with global trade growth weakening to 0.6% in 2023 and expected to recover to 2.4% in 2024. The report points to a shift in consumer spending from goods to services, rising geopolitical tensions, supply chain disruptions, and the lingering effects of the pandemic as factors impeding global trade.

Furthermore, the shift towards protectionist policies in some countries has also influenced trade dynamics, leading to a reevaluation of global supply chains and trade agreements. The repercussions of these changes are particularly pronounced in developing economies, which often rely heavily on exports for economic growth. In response, there has been a growing emphasis on diversifying trade partners and strengthening regional trade agreements to mitigate the risks associated with overreliance on a limited number of markets.

International Finance and Debt

Developing countries face high levels of external debt and rising interest rates, making access to international capital markets difficult. Theres a decline in official development assistance and foreign direct investment for low-income countries.

Debt sustainability has emerged as a critical challenge, especially for developing countries, in the wake of rising debt levels and changing global financial conditions. The increase in global interest rates, a consequence of monetary policy tightening by central banks like the Federal Reserve and the European Central Bank, has escalated debt servicing costs, particularly for countries with foreign currency- denominated debts. As a result, many countries are grappling with the need for debt restructuring, including renegotiating terms or seeking debt relief, to manage their escalating debt burdens more effectively.

Climate Change

2023 experienced extreme weather conditions, including the hottest summer on record since 1880 leading to devastating wildfires, floods, and droughts worldwide. These events have direct economic impacts, such as damage to infrastructure, agriculture, and livelihoods.

Studies have predicted substantial losses to the global economy due to climate change. For instance, some estimates suggest a potential reduction of about 10% in global GDP by 2100, considering events like the collapse of the Greenland ice shelf. Other models indicate that without mitigation of global warming, average global incomes could be 23% lower by 2100. The IPCC estimates that global GDP losses could range between 10 and 23 percent by 2100 due to temperature impacts alone.

Multilateralism and Sustainable Development

The 2024 WESP report calls for urgent action to address these diverse challenges. It emphasizes the need for strengthened global cooperation, particularly in areas like climate action, sustainable development financing, and addressing the debt sustainability challenges of low- and middle-income countries. The report underscores the critical role of multilateralism in navigating the complex global economic landscape and achieving the SDGs.

https://www.un.org/sustainabledevelopment/blog/2024/01/overview-world-economic-situation-and- prospects-2024/#:~:text=The%20report%20forecasts%20a%20deceleration.high%20debt%20and%20investment %20shortfalls

Indias Economic Performance:

India will remain the fastest-growing of the worlds largest economies, although its pace of expansion is expected to moderate. After a high growth rate in FY2023/24, steady growth of 6.7 percent per year, on average, is projected for the three fiscal years beginning in FY2024/25. This moderation is mainly due to a slowdown in investment from a high base.

However, investment growth is still expected to be stronger than previously envisaged and remain robust over the forecast period, with strong public investment accompanied by private investment. Private consumption growth is expected to benefit from a recovery of agricultural production and declining inflation. Government consumption is projected to grow only slowly, in line with the governments aim of reducing current expenditure relative to GDP.

https://openknowledge.worldbank.org/server/api/core/bitstreams/6feb9566-e973-4706-a4el- b3b82a1a758d/content

INDIAN AGRICULTURE INDUSTRY ANALYSIS

According to Inc42, the Indian agricultural sector is predicted to increase to US$ 24 billion by 2025. Indian food and grocery market is the worlds sixth largest, with retail contributing 70% of the sales.

As per the First Advance Estimates for 2023-24 (Kharif only), total foodgrain production in the country is estimated at 148.5 million tonnes.

Rabi crop area has increased by 3.25%, from 697.98 lakh hectares in 2021-22 to 720.68 lakh hectares in 2022-23. This is a 22.71 lakh hectare, a 13.71% increase over the average sown area in 2021 -22. As per the First Advance Estimates for 2023-24, rice is estimated at 1,063.13 lakh tonnes during the kharif season.

In 2022-23 (as per the second advance estimate), Indias horticulture output is expected to have hit a record 351.92 million tonnes (MT), an increase of about 4.74 million tonnes (1.37%) as compared to the year 2021 -22.

The Agriculture and Allied industry sector witnessed some major developments, investments, and support from the Government in the recent past. Between April 2000-December 2023, FDI in agriculture services stood at US$ 4.78 billion.

According to the Department for Promotion of Industry and Internal Trade (DPIIT), the Indian food processing industry has cumulatively attracted a Foreign Direct Investment (FDI) equity inflow of about US$ 12.35 billion between April 2000-September 2023. This accounts for 1.89% of total FDI inflows received across industries.

During 2023-24 (April-December), processed vegetables accounted for US$ 454 million, miscellaneous processed items accounted for US$ 1216 million and processed fruits & juices accounted for US$ 696 million.

Rapid population expansion in India is the main factor driving the industry. The rising income levels in rural and urban areas, which have contributed to an increase in the demand for agricultural products across the nation, provide additional support for this. In accordance with this, the market is being stimulated by the growing adoption of cutting-edge techniques including blockchain, artificial intelligence (AI), geographic information systems (GIS), drones, and remote sensing technologies, as well as the release of various e-farming applications.

In terms of exports, the sector has seen good growth in the past year. Indias agricultural and processed food products exports stood at US$ 35.18 billion in 2023-24 (April-December).

The exports for principal commodities in 2023-24 (April-December) were the following:

• Marine Product: US$ 5.85 billion

• Basmati and non-Basmati Rice: US$ 7.32 billion

• Spices: US$ 2.91 billion

• Buffalo Meat: US$ 2.76 billion

• Sugar: US$ 1.99 billion

• Miscellaneous processed items: US$ 1.22 billion

• Oil Meal: US$ 1.23 billion

(Source: https://www.ibef.org/industry/agriculture-india )

METALS AND STEELS:

India holds a fair advantage in production and conversion costs in steel and alumina. Its strategic location enables export opportunities to develop as well as fast-developing Asian markets. As of FY22, the number of reporting mines in India were estimated at 1,319, of which reporting mines for metallic minerals were estimated at 545 and non-metallic minerals at 774.

Minerals are precious natural resources that serve as essential raw materials for fundamental industries, so the growth of the mining industry is essential for the overall industrial development of a nation. The vast resources of numerous metallic and non-metallic minerals that India is endowed with serve as a foundation for the expansion and advancement of the nations mining industry. India is largely self-sufficient in metallic minerals including bauxite, chromite, iron ore, and lignite as well as mineral fuels like coal and lignite. The industry has the potential to significantly impact GDP growth, foreign exchange earnings, and give end-use industries like building, infrastructure, automotive, and electricity, among others, a competitive edge by obtaining essential raw materials at reasonable rates.

Rise in infrastructure development and automotive production are driving growth. Power and cement industries are also aiding growth for the sector. Demand for iron and steel is set to continue given the strong growth expectations for the residential and commercial building industry.

MARKET SIZE

Production level of important minerals in December 2023 were: Coal 929 lakh tonnes, Lignite 40 lakh tonnes, Petroleum (crude) 25 lakh tonnes, Iron ore 255 lakh tonnes, Limestone 372 lakh tonnes, Natural gas (utilized) 3078 million cu. m., Bauxite 2,429 thousand tonnes, Chromite 235 thousand tonnes, Copper conc. 11 thousand tonnes, Lead conc. 35 thousand tonnes, Manganese ore 319 thousand tonnes, Zinc conc. 148 thousand tonnes, Phosphorite 1 17 thousand tonnes, Magnesite 16 thousand tonnes and Gold 122 kg.

Important minerals showing positive growth during December 2023 over December 2022 include Magnesite (83.7%), Lead Conc. (16.5%), Lignite (14.6%), Copper Conc. (13.7%), Limestone (12.5%), Coal (10.8%), Zinc Conc. (7.8%), Bauxite (6.6%), Natural gas (U) (6.6%), Manganese Ore (4.0%) and Iron Ore (1.3%).

The index of mineral production of the mining and quarrying sector for the month of December 2023 at 139.4, was 5.1 % higher compared to the level in the month of December 2022.

Indias overall coal production has seen a quantum jump to 893.08 MT in FY23 as compared to 728.72 MT in FY19 with a growth of about 22.6%.

In April-January FY24, coal production stood at 784.1 1 MT, registering a growth of 12.18% from the same period last year. India is the worlds second-largest coal producer as of 2023.

In April-January FY24, the production of crude steel stood at 1 18.37 MT and that of finished steel was 1 13.85 MT.

In FY23, production of crude steel stood at 125.32 million tonnes (MT), finished steel at 121.29 MT and consumption of finished steel at 119.17 MT has exceeded their respective levels achieved over the corresponding period of not only COVID affected last two years but also pre COVID years as well. Indias iron ore production is estimated to stand at 257.85 MT in FY23, while it stood at 253.97 MT in FY22 - a sharp increase of 23% compared with 205.04 MT in FY21. Indias iron ore production stood at 202.64 MT during April-December 2023.

In 2022-23, exports of iron ore stood at US$ 1.75 billion as compared to US$ 3.18 billion in 2021-22. The production of aluminium was 4.07 MT in FY23.

The index of mineral production of mining and quarrying sector for the month of December 2023 (Base: 201 1-12=100) stood at 139.4, 5.1 % higher compared to the level in the month of December 2022. According to provisional data from the Indian Bureau of Mines (IBM), the cumulative growth for the period April- December, 2023-24 over the corresponding period of previous year is 8.5 % percent.

In FY23, mineral production is estimated at Rs. 1,18,246 crore (US$ 14.37 billion). In FY22, mineral production was estimated at Rs. 1,32,747 crore (US$ 16.04 billion). India ranks fourth globally in terms of iron ore production. Indias iron ore production is estimated to stand at 257.85 MT in FY23, while it stood at 253.97 MT in FY22, up 23% from FY21. In FY22, India had a total number of 901 steel plants producing crude steel. In April-January FY24, the production of crude steel stood at 1 18.372 MT and that of finished steel was 1 13.848 MT. Indias steel production is estimated to grow 4-7% to 123-127 MT in FY24. In April-January FY24, production of hot metal, crude steel and saleable steel by SAIL stood at 16.97 MT, 15.94 MT and 15.30 MT, respectively. Aluminium production in India stood at 3.47 MT between April-January FY24. The world production of primary Aluminium during the same period was about 59.562 MT. The share of India in the world primary Aluminium production was around 5.8% during this period.

INVESTMENTS/ DEVELOPMENTS

Some of the investments/ developments in the Metals & Mining sector in the recent past are as follows:

As per data from the Ministry of Statistics and Programme Implementation (MOSPI), Indias mining GDP increased from Rs. 76,877 crore (US$ 9.25 billion) in the third quarter of FY23 to Rs. 82,680 crore (US$ 9.95 billion) in the third quarter of FY24.

The index of mineral production of mining and quarrying sector for the month of December 2023 stood at 139.4, 5.1% higher as compared to the level in the month of December 2022.

In FY24 (until January 2024), the combined index of eight core industries stood at 156.0 driven by the production of coal, refinery products, fertilizers, steel, electricity, and cement industries.

Between April 2000-December 2023, FDI inflows in the metallurgical industry stood at US$ 17.46 billion, followed by the mining (US$ 3.50 billion), diamond & gold ornaments (US$ 1.27 billion), and coal production (US$ 27.73 million) industries.

In March 2024, Karnataka and Rajasthan initiated the auction of Exploration Licences (EL) for critical and deep-seated minerals, marking the first such auction in India. Under the amended Mines and Minerals (Development and Regulation) Act, 1957, introduced by the MMDR Amendment Act, 2023, 29 critical minerals are eligible for exploration and mining concessions.

In January 2024, India and Argentina signed an agreement to undertake the exploration and development of five lithium blocks, enhancing Indias efforts in sourcing lithium. Khanij Bidesh India Limited (KABIL) has obtained exploration and exclusivity right for these five blocks.

On August 3, 2023, the Rajya Sabha passed the Offshore Areas Mineral (Development and Regulation) Amendment Bill, 2023 which seeks to make amendments to the Offshore Areas Mineral (Development and Regulation) Act, 2002 (‘OAMDR Act). The Bill was passed by Lok Sabha on August 1,2023.

In July 2023, the Union Cabinet approved amendments to the Mines and Minerals (Development and Regulation) Act-1957 to allow the mining of lithium and other minerals.

Coal production from captive mines increased by 18.67% y-o-y in FY24 (April- September 2023) and contributed 14.96% to the total coal production.

In February 2023, Tata Steel and Central Building Research Institute (CBRI), a constituent of the Council of Scientific and Industrial Research (CSIR), signed an MoU to collaborate on research, academic growth, and sustainable solutions in mining.

In February 2023, ArcelorMittal - Nippon Steel is investing Rs. 60,000 crore (US$ 7.3 billion) to expand its steelmaking capacity in Hazira to I5MT a year from 9MT.

In February 2023, NMDC signed an agreement for collaborative research with CSIR-IMMT, Bhubaneswar on “Feasibility Studies for Preparation of Fused Magnesia from Kimberlite Tailings” at its Head Office in Hyderabad.

In November 2022, IIT Bombay and JSW Group entered into an exclusive strategic agreement to establish first-of-its-kind, state-of-the-art JSW Technology Hub in India for steel manufacturing in India.

In August 2022, Tata Steel signed a MoU with the Government of Punjab for setting up a 0.75 MnTPA long products steel plant with a scrap-based electric arc furnace.

In July 2022, Hindalco Industries Limited has signed an MoU with Phinergy and IOC Phinergy Private Limited (IOP) on R&D and pilot production of aluminium plates for Aluminium-Air batteries, and recycling of aluminium, after usage in these batteries.

In October 2022, Coal India Limited (CIL) signed a MoU with Rajasthan Rajya Vidyut Utpadan Nigam Limited (RVUNL), for setting up 1,190 MW solar power project.

In January 2023, Vedanta announced that its board had approved the sale of its international zinc assets in South Africa and Namibia to subsidiary Hindustan Zinc (HZL) for US$ 2.98 billion.

In March 2022, MOU with detailed collaborative framework was between KABIL, India, and Critical Mineral Office (CMO), Department of Industry, Science and Resources (DISER), Govt. of Australia for carrying out joint due diligence and further joint investment in Li & Co mineral assets of Australia.

In February 2023, JSW Group announced to build a steel plant in Andhra Pradeshs YSR Kadapa district with an investment of Rs. 8,800 crore (US$ 1 billion).

In 2021, an Indian state committee recommended the expansion of Vedanta Ltd.s Lanjigarh Alumina refinery from 1 million tonnes to 6 million tonnes, an investment that would cost the company Rs. 6,483 crore (US$ 993 million).

In February 2023, Essar Capital Limited, investment manager of Essar Global Fund Limited, announced to set up steel plants in Odisha and a facility to import liquefied natural gas (LNG) at Hazira in Gujarat.

On 2nd September 2022, Steel Authority of India Ltd. (SAIL) has supplied about 30000 tonnes of the specialty steel for nations first indigenously built Aircraft Carrier INS Vikrant for Indian Navy which commissioned at Cochin Shipyard Ltd.

Innovative mineral exploration activities using state-of-the-art technology by Geological Survey of India (GSI), stepped up efforts by Khanij Bidesh India Limited (KABIL) to source strategic minerals from countries like Australia, Argentina, and Chile.

Three Indian state-run companies, National Aluminium Co Ltd, Hindustan Copper Ltd and Mineral Exploration Corp formed a joint venture to buy mining assets overseas that have minerals such as lithium and cobalt, which are used in the manufacture of batteries for electric vehicles.

• Production of metallic minerals in the country increased from US$ 6.96 billion in FYI8 to US$ 12.88 billion in FY23P. In the same period, production of non-metallic minerals increased from US$ 1.16 billion in FYI8 to US$ 1.48 billion in FY23P.

• Indias iron ore production stood at 257.85 MT in FY23, an increase of 1.52% compared with 253.97 MT in FY22.

• ICRA has estimated the domestic aluminium demand growth to remain healthy at around 9% in the next two fiscal years, given the Governments thrust on infrastructure development.

• The index of mineral production of mining and quarrying sector for the month of December 2023 stood at 139.4, 5. I % higher as compared to the level in the month of December 2022.

• Between April 2000-December 2023, FDI inflows in the metallurgical industry stood at US$ 17.46 billion, followed by the mining (US$ 3.50 billion), diamond & gold ornaments (US$ 1.27 billion), and coal production (US$ 27.73 million) industries.

• As per data from the Ministry of Statistics and Programme Implementation (MOSPI), Indias mining GDP increased from Rs. 76,877 crore (US$ 9.25 billion) in the third quarter of FY23 to Rs. 82,680 crore (US$ 9.95 billion) in the third quarter of FY24.

• In FY23, Vedantas aluminium division will focus on backward integration and will put two of its mines in Odisha into production.

• Iron and steel imports stood at US$ 14.17 billion during April-December 2023.

• In FY24 (until January 2024), the combined index of eight core industries stood at 156.0 driven by the production of coal, refinery products, fertilizers, steel, electricity, and cement industries.

• NMDCs cumulative iron ore production (April-January FY24) stood at 36.32 MT as compared to 31.14 MT (April-January FY23).

• As of January 2024, Indias total installed electricity generation capacity stood at 429.96 GW.

• In 2021-22, Indias iron and steel export was valued at US$ 17.62 billion. During FYI6-22, Indias export of iron and steel grew at a CAGR of 17.15%.

• In November 2021, JSW Steel announced that the company registered a 6% YoY surge in crude steel production at 1.42 million tonnes in October 2021.

• In November 2021, AMNS India announced that it is planning to manufacture specialty steel under the production-linked incentive (PLI) scheme.

• Vedanta Limited is planning a US$ 20 billion investment across its operations, including increase silver production and steel capacity.

• In June 2021, Mr. T.V. Narendran, the CII President, and Managing Director of Tata Steel, stated that steel firms have firmed up plans to invest ~Rs. 60,000 crore (US$ 8 billion) over the next three years in this sector.

• In May 2021, Vedanta Ltd. announced its plan to invest Rs. 10,000 crore (US$ 1.34 billion) in setting up an aluminium park in Odisha to facilitate companies that use metal to set up their manufacturing units in the facility.

• In May 2021, ArcelorMittal Nippon Steel (AMNS) signed a contract with Total (a France-based energy company) for supply of up to 500,000 tons of liquefied natural gas (LNG) per year until 2026.

• In February 2021, ArcelorMittal-Nippon Steel India, in agreement with the Odisha government, has planned to set up an integrated steel plant (with I2 MT capacity) in the states Kendrapada district for Rs. 50,000 crore (US$ 6.89 billion)

• In February 2021, two new iron ore mines were inaugurated in Odisha, with a production capacity of I5 lakh tonnes per month and ~275 million tonnes of consolidated iron ore reserves. These mines will bring in ~Rs. 5,000 crore (US$ 679.28 million) in annual revenue for the state and employment opportunities for locals.

GOVERNMENT INITIATIVES

The Government of India has adopted few initiatives in the recent past, some of these are as follows:

• In February 2024, the Union Cabinet approved the amendment to the Mines and Minerals (Development and Regulation) Act,1957 specifying royalty rates for 12 critical minerals, thus completing the rationalization process for all 24 strategic minerals. This move aims to streamline the mining sector and auction processes, aligning with recent amendments to the MMDR Amendment Act, 2023.

• In December 2023, the Ministry of Mines proposed capping performance security and upfront amounts for mining critical minerals to attract more bidders. Currently based on a percentage of the Value of Estimated Resources (VER), the move aims to reduce barriers to participation in auctions and expedite the process for mining leases.

• In October 2023, the Union Cabinet approved the amendment of the Second Schedule of the Mines and Minerals (Development and Regulation) Act, 1957, specifying royalty rates for three critical minerals: Lithium, Niobium, and Rare Earth Elements (REEs) paving the way for the auctioning of blocks for these minerals, as outlined in the MMDR Amendment Act, 2023.

• The government plans to monetize assets worth Rs. 28,727 crore (US$ 3.68 billion) in the mining sector over 2022-25.

• In 2022, PLI Scheme for domestic production of specialty steel has been approved with an outlay of Rs. 6,322 crore (US$ 762.4 million) by the Cabinet.

• Mines and Minerals (Development and Regulation) Amendment Act, 2021, notified on 28.03.2021, for giving boost to mineral production, improving ease of doing business in the country and increasing contribution of mineral production to GDP.

• Enactment of Mines and Minerals (Development and Regulation) Amendment Act, 2021 enabled captive mines owners (other than atomic minerals) to sell up to 50% of their annual mineral (including coal) production in the open market.

• Import duty on Anthracite/Pulverized Coal Injection (PCI) coal, Coke, and Semi-coke and Ferro-Nickel were reduced to zero.

• Export duty on Iron ores/ concentrates and iron ore pellets was raised to 50% and 45%, respectively.

• In addition, 15% export duty was imposed on pig iron and several steel products.

• District Mineral Foundation (DMF) has been established in 622 districts of 23 States and a total of Rs. 71,128.71 crore (US$ 8.5 billion) has been collected till October 2022 under DMF.

• In November 2022, the government removed export duties on steel and stainless steel to strengthen the nations steel sector and allow it to firmly establish its position in the global market.

• The government plans to monetise assets worth Rs. 28,727 crore (US$ 3.68 billion) in the mining sector over 2022-25.

• The Ministry of Mines of the Government of India has signed MoUs with different nations.

• The Ministry of Mines notified the Mineral Conservation and Development (Amendment) Rules in November 2021 to provide rules regarding conservation of minerals, systematic and scientific mining, and development of minerals in the country for environment protection.

• Steel Authority of India Ltd. (SAIL) and Central Public Sector Enterprises (CPSEs), under the Ministry of Steel, supplied 48,200 tonnes of steel for the Purvanchal Expressway, which was inaugurated by Prime Minister Narendra Modi on November 16, 2021.

• As part of unlocking Indias vast mineral potential by exploration this year, the Ministry of Mines has handed over 152 mineral block reports to different state governments until November 2021. Also, 52 potential G-4 mineral blocks approved by the Geological Survey of India (GSI) have been handed over to 15 state governments.

• In July 2021, the Odisha government approved five key industrial projects worth Rs. 1.46 lakh crore (US$ 19.60 billion) that are expected to boost capacity of steel production by 27.5 million tonnes.

• In June 2021, the Union Cabinet, chaired by the Prime Minister Mr. Narendra Modi approved the memorandum of understanding (MoU) to be signed between the Ministry of Mines and the Secretariat of Mining Policy of the Ministry of Productive Development of the Argentine Republic. The MoU will provide an institutional mechanism for cooperation in the field of mineral resources.

• In Union Budget 2021, the government reduced customs duty to 7.5% on semis, flat and long products of non-alloy, alloy, and stainless steels to provide relief to MSMEs.

• To boost recycling of copper in India, the government announced reduction of import duty on copper scrap from 5% to 2.5% in the Union Budget 2021.

• The National Steel Policy aims to boost per capita steel consumption to 160 kgs by 2030-3 1. The government has a fixed objective of increasing rural consumption of steel from the current 19.6 kgs per capita to 38 kgs per capita by 2030-3 1.

https://www.ibef.org/industry/metals-and-mining

OUTLOOK

Our Company is in the Line of Business of Import/ Export or Trading of following products and also deals in Engineering / Technical Consultancy or Indenting / Commission or Business Consulting Services of:

1. Metal Scrap - The Company offers a wide range of scrap metals viz. HMS (Heavy Melting Scrap), aluminum scrap, stainless steel scrap, copper scrap, brass scrap, etc. The company also deals in ferrous Scrap, non-ferrous Scrap and reusable items. It procures metal scrap originating from USA, West African and European countries, and sells these products in the domestic market all over India.

2. Petrochemicals - The Company also operates in the trading, wholesaling, distribution and indenting business of base oil variants to refineries along with supply of petrochemicals to industries. The petroleum products traded / distributed by the Company are Group I, II and III variants for automobiles lubricants and different industrial purposes, Granular & Formed Sulphur used in phosphate based industrial and consumer industry sectors and Aromatics - Benzene, Toluene.

We have developed a sustainability mission for our company which can be briefed in three words (reduce-reuse-recycle).

BUSINESS OVERVIEW

The total standalone turnover including other income for the year 2023-24 stood at Rs. 10,430.75 Lacs as compared to Rs. 8,633.49 Lacs for the year 2022-23. Total consolidated turnover of Rs. 18,440.76 lacs during the year under review as against the consolidated turnover of Rs. 22,225.1 1 Lacs in the last year 2022-23.

MARKETING

The Company has set up a good marketing team.

INTERNAL CONTROL

The Company has an internal control system, commensurate with the size of its operations. Adequate records and documents were maintained as required by laws. The Companys audit Committee reviewed the internal control system. All efforts are being made to make the internal control systems more effective.

CONSOLIDATED SEGMENT WISE REPORTING

During the year under review, Company has achieved all sales under Segment B i.e., Trading only. Name of the segments dealed by the Company during the year 2023-24:

1. Segment A: Manufacturing (Closed Operations)

2. Segment B: Trading

RISKS AND CONCERNS

In any business, risks and prospects are inseparable. As a responsible management, the Companys principal endeavor is to maximize returns. The Company continues to take all steps necessary to minimize losses through detailed studies and interaction with experts.

CAUTIONARY STATEMENT

Statement in this Managements Discussion and Analysis detailing the Companys objectives, projections, estimates, expectations or predictions are “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and Indian demand-supply conditions, feedstock availability and prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the Company conducts business and other factors such as litigation and labour negotiations.

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has followed all the treatments in the Financial Statements as per the prescribed Accounting Standards.

By Order of the Board of Directors

For AKG Exim Limited

Sd/-

MAHIMA GOEL

MANAGING DIRECTOR

DIN:02205003

Place: Gurugram

Date: 22.08.2024