Galaxy Bearings Ltd Management Discussions

<dhhead>ANNEXURE- 6</dhhead>

MANAGEMENT DISCUSSION AND ANALYSIS

ECONOMIC OVERVIEW

The global bearings market size is expected to reach USD 271.99 billion in 2023, registering a CAGR of 14.01% over the forecast period, according to a new report by Grand View Research, Inc. Bearings are essential in almost every application that involves motion, and they help minimize friction between different mechanical components in several industrial machinery and equipment, resulting in reduced energy consumption. Hence, this machine element finds application in all industries, ranging from automobiles, household appliances, and aerospace to industrial machinery, using machinery or related motor-driven linkages. The market is estimated to witness considerable growth in the forthcoming years, ascribed to the aim to achieve energy efficiency. Energy-saving and bearings go hand-in-hand. The main objective of this element is saving energy by reducing friction, be it during the rotation of shafts of a transmission or the wheel of a vehicle.

India Bearings Market size is projected to grow at a CAGR of 13.5% during 2024-32. (Source: 6Wresearch) due to growing demand for specialized bearing solutions and improved designs to increase product performance and efficiency. However, the outbreak of corona virus pandemic would impact the automotive and other industries affecting the bearings market over the coming years, though the effects might be short lived.

 

INDUSTRY STRUCTURE AND DEVELOPMENT AND OUTLOOK

The growth of the bearing industry is correlated with the automotive and industrial sectors. The demand for the bearings is derived from two key user segments - the automotive and industrial sectors. A major portion of bearings market in India is unorganized that caters to the low-end replacement market. Several main industrial sectors and user segments are expected to push the production of industrial equipment and automotive, leading to an increase in demand for automotive component, equipment, and vehicles in the developing countries.

The Company is well-positioned to leverage opportunities. Firmly driven by its strategic focus on digitalization, world-class manufacturing, future workforce equipped to face the future with its strong resolute. This enables the Company to offer a comprehensive product portfolio to its customers, emphasizing high-quality standards and service aids, delivering value and sustainable growth.

 

RISK & CONCERN

The Company is exposed to external business risk, internal risk and financial risk. External business risks arise out of highly competitive industry, Variations in prices of raw-material etc. Internal risks basically cover operational efficiency and ability to withstand competition. Financial risks are basically in the nature of interest rate variations.

 

OPPORTUNITIES AND THREATS Opportunities:

Growth in the manufacturing sector due to strong demand from multiple industries such as machinery, construction, automotive, aerospace, defence, etc. is further spurring the growth of India’s bearing industry. Notably, with the increasing adoption of new technologies and digitalization, manufacturers are focusing on the utilization of customized bearings to meet their evolving needs. So much so that with rising in demand for specialized bearing solutions that meet different industry-specific requirements such as the growing EV sector

will further boost the market. With robust policies providing an impetus to the manufacturing sector, the bearing industry will develop too. Right from helping customers meet efficiency goals, increase productivity to reducing unplanned downtime and longer maintenance cycles, the bearings makers are witnessing high levels of innovation and technological advancements. For example, in industrial applications, Smart bearings, that measure and communicate their operating conditions continuously, are enabling customers to have even better control over the life cycle of their machinery, leading to lower costs and higher reliability and machinery uptime. These better designed and technologically efficient bearings across critical and hi-tech applications are expected to offer numerous market opportunities.

 

Threats:

The cost of raw materials remains the top concern for manufacturers. As high-grade steel is the primary raw material used for manufacturing bearings, bearings price is highly correlated with the global steel price movement. The fluctuation of raw material price creates challenges for the bearing manufacturers to produce bearings in comparative price and high quality. Additionally, fluctuating supply and demand scenario is hindering the growth of the bearing industry.

Counterfeit products and the other from cheap imports. Counterfeit products have a multifold impact on the industry; they not only are damaging the brands but also pose a safety and financial hazard for its victims. Cheap imports are a threat as they lead to inefficient utilization of Bearings are mainly manufactured using high grade steel or alloy steel, which exposes them to global steel price movement.

 

SEGMENT-WISE-PERFORMANCE

Galaxy Bearings is the most trusted supplier in the industry for bearings. It operates in a single segment, namely in "ball and roller bearings", which are used in widespread applications across industries. The Companys world-class manufacturing facilities.

 

INTERNAL CONTROL SYSTEMS

The Company has adequate systems of Internal Controls commensurate with its size and operations to ensure orderly and efficient conduct of business. These controls ensure safeguarding of assets, reduction and detection of fraud and error, adequacy and completeness of the accounting records and timely preparation of reliable financial information.

 

FINANCIAL PERFORMANCE

During the Financial year 2023-2024 the Company has earnings before interest, depreciation and tax amounting to Rs. 2773.08 Lakhs after providing for finance cost of Rs. 50.24 Lakhs and depreciation of Rs. 180.44 Lakhs, Profit before tax comes to Rs. 2542.40 Lakhs.

 

HUMAN RESOURCES

Employees are biggest source for any Companys success. Our Human Resource Team based on their strengths, potential land determination towards work evaluates the employees. It is very important to keep the employees encouraged to take decisions and initiatives towards the betterment of their work. The company encourages and provides them a safe and motivating work environment. The Company has always followed process of Appraisal from time on time, to recognize talents and ensure that employees remain devoted to the organization on a long-term.

 

CAUTIONARY STATEMENT

Statements in this report on Managements Discussion and Analysis describing the Companys objectives, projections, estimates, exceptions or predictions may be forward looking statements within the meaning of

applicable security laws or regulations. These statements are based on certain assumptions and exceptions of future events. Actual results could however differ materially from those expressed or implied. 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.

For and on behalf of the Board of Directors For Galaxy Bearings Limited

Date: August 09, 2024	Bharatkumar Ghodasara	Kartik Kumar Patel
Place: Ahmedabad	Whole-time Director	Independent Director
	DIN:00032054	DIN:10118898