Neueon Towers Ltd Management Discussions

Pursuant to Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 your directors wish to report as follows: FY 2020-21 began on a very weak note for India, as the onset of the pandemic triggered panic and brought most economic activities to a near halt in the first quarter. While annual estimates of contraction varied (and kept improving), the first saw a 23.4% decline in GDP. With the second quarter also being one of decline, albeit at a slower pace than that in the first, the economy entered a technical recession with two successive quarters of contraction. This happened only the second time since Independence and for the first time since economic liberalisation in 1991.

Indias resilience and ability to bounce back was evident, and this continues to provide confidence to the industry to stay invested in its future. Almost all core sector industries seemed confident of reaching pre-COVID levels of output and revenue. Consequently, the full-year GDP saw a net decline of just about 7.3% far lesser the initials fears (Source: National Statistical Office{NSO}).

Opportunities and Threats:

Continued densification opportunity driven by 4G: Since its launch in 2014-15, 4G data volumes have continued to rise year after year driven by a combination of more users and higher average consumption per user. The year 2020, witnessed 4G payload increase by another 40% YoY (Source: Nokia MBiT 2021). We believe this growth will lead to continued densification of networks in the country, especially as consumption moves more to video content including live video streaming which requires more capacity and lower latency. Also, with introduction of low cost 4G smart phones, migration from 2G/3G is likely to further intensify 4G traffic growth which could add a further boost to the overall demand in the coming years.

Risk and Concerns:

Your Company has put in place, a comprehensive risk management policy for identification and assessment of risks which is monitored by the risk management committee of the Company. The Committee closely monitors the process and suggests suitable measures to mitigate the risks. While the risks caused or likely to be caused by the internal happenings are promptly identified and dealt with by the Company. While the external factors still remain imponderable and are still not yet under the control of the Company.

Outlook and Opportunities:

Company is modest in assessing its outlook in view of the aforementioned factors. We are looking for an early resolution of the debt-restructuring issues to gain from tremendous opportunities in future for the products of the Company.

Internal Control Systems and their Adequacy:

The internal control systems as prevailing in the Company are commensurate with the size and nature of business of the Company. The Company has the system of Internal Audit. Internal Auditors do regularly make assessment of internal control in various areas of operation and report to the Audit Committee with their suggestions for the improvement of the same.

Accordingly, the suggestions for improvement wherever deemed necessary are implemented immediately. As usual,, the management keeps a continuous watch on internal control systems of the company.

Human Resource and Industrial Relations:

The relations between the Company and the employees are cordial. Company recognizes that the key to achieving its plans and sustaining them is none other than having best human resources pool.

Your Company endeavors in recruiting the best of talent, motivating and retaining them and considers development of this biggest asset as its primary responsibility.

Highlights of the Financial Results:

During the financial year, Your Company has achieved a turnover of Rs. Nil for the year ended 31 March, 2021, as against the turnover of Rs. 293.81 lakhs for the previous year ended 31st March, 2020.

Segment Wise Performance & Geographical Information:

The Company primarily engaged in the business of Iron & Steel products, more specifically Transmission/ Telecom Towers and TSF products, which constitute a single segment in the context of Accounting Standard-17 on "Segment Reporting". Geographically, all the manufacturing facilities of the Company are situated within India, while its marketing operations spread over many countries.

Statutory Compliance:

Your Company gives priority to comply all of the statutory requirements in time and the management regularly discusses the same with all the departmental heads. The Company Secretary, as the compliance officer, ensures timely compliance with the SEBIs Regulations and provisions of listing agreements.

Corporate Social Responsibility (CSR):

While your Company, through Sujana Foundation, the CSR arm of the Sujana Group, strives to do what best it can do in this direction. However, it is regretted to report that in view of the losses during the year under review, no major CSR activities were taken up. The Company has in place, a Corporate Social Responsibility (CSR) Committee in compliance with the provisions of the Companies Act, 2013.

Cautionary Statement:

Statements in the Management Discussion and Analysis describing the Companys objectives, expectations or predictions may be forward looking within the meaning of applicable securities, law and regulations. The Company assumes no responsibility to publicly amend, modify or revise forward looking statements, on the basis of subsequent event or development. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operations, to mention some, are the selling price of finished goods, input availability and price, changes in government regulations, tax laws, economic development within and outside the country and other factors such as litigation and industrial relations.