Indo National Ltd Management Discussions

For this category, volume growths are still under stress as there are multiple user shifts happening towards rechargeable gadgets and decline in battery operated gadgets, especially toys and flashlights. D size is continuing its declining trend.

The raw material costs and ocean freight although the year was on the higher side which severely impacted your company margins.

Despite the above challenges, your company has grown 3% in value and has identified growing urban, launching alkaline and more as key drivers to grow in this category.

NON- BATTERY CATEGORY:

Your company witnessed a growth in terms of both value and volume in LED lighting, Electrical accessories, Mosquito bats and Rechargeable flashlights. 37% of revenue contribution is from non-battery categories. Your company has comprehensive plans to grow in each of these categories around products, go-to- market and brand building.

OUTLOOK ON OPPORTUNITIES:

Batteries:

It has been observed urban India will be driving consumption in this category. Your company has plans to strengthen urban distribution and make strong expansion into modern trade and e-commerce platforms. Alkaline as a segment has been fastest growing. Your company will be launching an alkaline range as part of the entire urban focus.

The major input costs are showing signs of softening, it will help your company improve margins and making investments in the brand.

Non-Batteries :

Last 4 years, your company made LED business as the second largest category by making good inroads in few pockets. Your company will continue to focus on LED across India through distribution expansion, channel management and new product introductions.

Rechargeable torches at economical price points is one way to accelerate growth and this is the opportunity is being addressed with the new RC launches.

With mosquito swatters, your company is making into a large "home-care" segment. Your company will invest into new product offerings and focused distribution to drive growth in this category.

THREATS RISK AND CONCERNS BATTERIES:

As the category has stabilized after multiple corrections in terms of usership over the past few years such as medical equipment usage, shifting of battery operated to rechargeable devices, etc. It is poised for fresh growths; hence your company does not foresee any threats. However, the focus should be on managing the raw material costs as a large chunk is being imported with many external factors.

NON-BATTERY CATEGORIES:

Unbranded players dominating in the growing Rechargeable flashlight segment is a threat. Your company will be focusing on launching value for money RC torches.

In mosquito swatters, you company has first movers advantage. However, multiple players both global and domestic players have entered the category which is poised for exponential growth.

LED is a fiercely competitive market with dynamic trade pricing and handling after sales market returns. Your company is focusing on distribution infrastructure and channel plans to handle both.

INTERNAL CONTROL SYSTEMS AND ADEQUACY:

The Company has adequate Internal Control procedures commensurate with its size and nature of the business. These business control procedures ensure efficient use and protection of the resources and compliance with the policies, procedures and statutes. The InPternal Control system provide for well- documented policies, guidelines, authorizations and approval procedures. The Internal Auditors RGN Price & Co., had carried out Internal Audit extensively throughout the year. The prime objective of such Audit is to test the adequacy and effectiveness of all Internal Controls laid down by the management and to suggest improvements, wherever necessary.

FINANCIAL PERFORMANCE:

The total turnover of the Company for the year under review was Rs.404.80 Crs. as compared to Rs.368.27 Crs. in the previous year. The profit after tax for the year under review is Rs.1.00 Crs. as against Rs.7.78 Crs. in the previous year.

HUMAN RESOURCES:

The Company regards its human resources amongst its most valuable assets and proactively reviews and evolves policies and processes to attract and retain requisite skill-sets covering technical and managerial functions through a work environment that encourages initiative, provides challenges and opportunities and recognizes the performance and potential of its people. As of March 31, 2023, the number of employees stood at 506 covering all locations compared to 509 as of March 31, 2022.

For and on behalf of the Board of Directors

For Indo National Ltd

	P Dwaraknath Reddy	PAditya Reddy
Place : Chennai	Managing Director	Joint Managing Director
Date : 11th August, 2023	(DIN:00277929)	(DIN:00482051)