Veerhealth Care Ltd Management Discussions

Industry Structure and Outlook

Ayurveda has a long tradition behind it, having originated in India perhaps as much as 3,000 years ago. In India, it is extremely popular and even considered mythical with origins going as far as the prehistoric ages. There is even a National Ayurveda Day in India. This industry has become globally competitive as it exports a significant amount of its products.

Ayurveda developed ignificantly during the Vedic period and later some of the non- edic systems such as Buddhism and Jainism also developed medical concepts and practices that appear in the classical Ayurveda texts. Developments in Ayurveda during the past two centuries through organised production of medicine, institutionalisation of education and professionalization of clinical practice have often been parallel t developments in biomedicine in India.

Strengths

Ayurvedic treatments, products and medicines are known to have no side-effects.

The Company carries out research extensively to introduce research based products in the market. The Company produces 100% natural products which are not tested on animals, making the r nge of prod cts 100% cruelty free. Over the world, natural and traditional approaches are being welcomed. The Company has an extensive range of Ayurvedic medicines. The Company has a strong manufacturing base having an able infrastructure.

Weaknesses

Building a brand image involves high cost and considerable amount of time. Irregular supply of raw material. The Company does not have any direct outlets. Cut throat competition fro existing and new entrants in the market.

Opportu ities

Expansion in terms of introduction of new product line.

The global health care products industry is growing at a very rapid pace which allows company to pursue aggressive expansion plans. The growth o consumer demand for ayurvedic products is increasing due to the increasing awareness of ayurvedic products. Natural and traditional approaches are being accepted worldwide. Lifestyle changes & unheal hy food habits has led to transformation of the medical preferences. Tapping opportunities in the export market.

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Threats

Constant increase in costs in terms of raw material and packaging costs. Non-availability of certain herbs on a regular basis.

Lack of measures to standardize medici es and herbs used in Ayurvedic treatment.

Since the cultural mind set is such that Ayurvedic treatment takes more time to heal, people are afraid to start t.

Risks

Company classifies the risks broadly into two categories, viz., External Risks and Internal Risks. The external risks mainly comprises of business risks on various fronts. The identified business risks and opportunities are deliberated in detail and thereafter considered in the business plan of the Company along with the mitigation plan. The internal risks identified by the Board are systematically addressed on a continuous basis across the locati ns.

Internal ontrol systems and their adequacy

Our governance and compliance processes, which include the review of internal control over financial reporting ensure that all the assets of the Company are safeguarded and protected against any loss and that all the transactions are properly authorized, recorded and reported. It also conducts regular internal audits to test compliance with the statutory req irements. Audits are led by professio al audit managers and supported by experienced personnel drawn from across the organization. Audit esults are used by management to create detailed action plans where the businesses have not yet achieved full compliance with the requirements. Key findings are reported to senior management and summary reports are considered by the Audit Committee of the Board. The nature of the industries in which the company operates means that many of its activities are highly regulated by health, safety and environmental norms while maintaining operational integrity.

Financial Performance

Veerhealth Care has been a consistent value creator for all its stakeholders. Detail regarding financial performance is published in the Annual Report.

Human Resources

The positive and motivating work environment of the company advances innovation ncourages gr rowth and inculcates a positive spirit among the workforce. Employees are nurtured within the company, which increases their potential and growth in various matters. Working in the company has always made it an enriching experience for the multi-generational, diversified and mobile workforce.

Cautionary Statement

The statements made above may be construed s forward looking statements within the meaning of the applicable laws and regulations. Actual performance of the Company may vary substantially depending upon the business structure and model from time to time.