Viviana Power Tech Ltd Management Discussions

Industry Structure and Development & Outlook:

Power is among the most critical components of infrastructure, crucial for the economic growth and welfare of nations. The existence and development of adequate power infrastructure are essential for the sustained growth of the Indian economy.India has set ambitious targets for renewable energy capacity and is on track to achieve these targets. Also,the government is striving towards strengthening an existing system through the RDSS scheme.

Indias power sector is one of the most diversified in the world. Sources of power generation range from conventional sources such as coal, lignite, natural gas, oil, hydro, and nuclear power to viable non-conventional sources such as wind, solar, and agricultural and domestic waste. Electricity demand in the country has increased rapidly and is expected to rise further in the years to come. In order to meet the increasing demand for electricity in the country, massive addition to the installed generating capacity is required.

India was ranked fourth in wind power, fifth in solar power, and fourth in capacity, as of 2020. India is the only country among the G20 nations that is on track to achieve the targets under the Paris Agreement.

The Government of India has released its roadmap to achieve 227 GW capacity in renewable energy (including 114 GW of solar power and 67 GW of wind power) by 2022. The Union Government of India is preparing a ‘rent a roof policy for supporting its target of generating 40 gigawatts (GW) of power through solar rooftop projects by 2022.

The Central Electricity Authority (CEA) estimates Indias power requirement to grow to reach 817 GW by 2030. The government plans to establish a renewable energy capacity of 500 GW by 2030.

India has one of the largest and most complex power sectors in the world. Over the past few decades, the country has witnessed a remarkable evolution. Today, almost every citizen has access to grid electricity, power deficiency has decreased sharply, and the installed renewable energy capacity has reached a fourth of the total capacity.

Crucial to this evolution has been the EA 2003 which enabled a primarily state-owned sector riddled with mounting losses and debt to move towards a more open and competitive system. EA introduced many new policy features such as the introduction of competition through open access, multi-year tariff frameworks, distribution franchisees, de-licensing generation, the establishment of renewable purchase obligations, and the creation of independent regulatory bodies.

However, the distribution sector is still mired in difficulties. Most discoms incur vast losses every year, and the situation is only getting worse with every passing day. Unable to pay generators on time, they have accumulated huge debts, and are not able to supply reliable and high-quality power to their customers.4 A financial and operational turnaround of the discoms is urgent.

Although discoms as a group are faring poorly, some individuals are performing better than others.

Over the past few decades, different states and discoms have chosen different reform paths which have resulted in these varied outcomes. This report presents these learnings and best practices to help policymakers and practitioners bring about a financial and operational turnaround in the discus performance.

Our company in the sector

Our Company is engaged in the business of Power transmission, Distribution, and Industrial EPC space projects (Engineering, Procurement, and construction). We provide a wide range of services such as Power Transmission lines, EHV substations, Testing and Commissioning of sub-station and Transmissionlines, Power Distribution Network Establishment, Underground Cable laying, and

Upgradation and modification of existing power systems. We undertake turnkey jobs for the Supply,

Civil, Erection, Testing & Commissioning of all types of Electrical systems.

Our Company deals with state government power utilities, private power entities, and Renewable energy developers. Preferentially, the company opts for EPC projects. Company bags project work from government utilities through the open bidding process and from private power entities and renewable energy developers by way of open bidding or preferential basis in accordance with the companys merit and performance.

The company has set business modules to suit operational needs. Business operations mainly comprise two main tasks: Supply and service. For performing these tasks, various sequential activities are performed. It has to deploy quality manpower and developed resources. Our Company owns adequate machinery but for specific requirements of machinery, we have to avail services on hire basis. At the site, the company sets up office and store facilities as per project requirement and deploy the project team and hire labors on daily basis as per the site requirement.

Risks and concerns:

The Risk factors have been determined and disclosed on the basis of their materiality. The following factors have been considered for determining the materiality:

1. Some events may have material impact quantitatively;

2. Some events may have material impact qualitatively instead of quantitatively;

3. Some events may not be material individually but may be found material collectively;

4. Some events may not be material at present but may be having material impact in future.

OUR STRENGTHS

Organizational stability along with management expertise

Our company has an established track record of over 8 years which indicates the companys ability to whether economic and business cycles and competent promoters have over a decade of relevant experience. This indicates our ability to maintain business viability and steer the business through operational hurdles. Our management and employee team combines expertise and experience to outline plans for the future development of the Company. Our Promoters and Managing Director have significant in the consistent growth of our company.

The promoters are supported by an experienced team who knows in and out of the Companys business. We believe that the knowledge and experience of our promoters and management enables us to identify new opportunities, rapidly respond to market conditions, adapt to changes in the business landscape and competitive environment, and enhance the growth of the business.

Existing client relationship

We have maintained a good relationship with our major customers. We are successful in building a strong client base for our business. Our existing relationships help us to get repeat business from our customers. This has helped us to maintain a long-term working relationship with our customers and improve our customer retention strategy. We believe that our existing relationship with our clients represents a competitive advantage in gaining new clients and increasing our business.

Well-trained employee base

We provide high-quality professional solutions, design, and engineering services to our customers. Our highly skilled professionals and dedicated team are ever ready to deliver their efficient services. Our Company provides technical expertise in the most efficient and cost-effective way, helping to ensure the highest degree of reliability and availability of the project. Having achieved a certain degree of expertise after successfully executing various projects, we have an extremely experienced and diverse set of professionally trained and qualified engineers with versed ability in tackling and providing solutions to our customers and the capability to handle all requirements and installations even at the highest scale and magnitude.

Quality Assurance

Our Company is an ISO 9001:2015 certified organization for Quality Management Systems, ISO

14001:2015 for Environmental Management Systems, and OHSAS 45001:2018 for Occupational Health and Safety Management Systems. We will continue to maintain the quality of our existing services to cater to various customers in the market. We endeavor to maintain the quality of our service and follow strict procedures to ensure timely delivery and competitive prices. The company intends to strengthen its development effort by leveraging the skills of its employees which will help to increase the sales of the Company and retain customers.

Expand our Current Business Relationships

Our goal is to build long-term sustainable business relationships with our customers to generate increasing revenues. We plan to continue to expand the scope and range of current services provided to our existing customers by continuing to build our expertise and extend our capabilities. Leveraging our market skills and relationships is a continuous process in our organization and the skills that we impart to our people give importance to customers. We aim to do this by leveraging our marketing skills and relationships and further enhancing our customer base. Our ability to maintain and improve the services we offerto customers enables us to generate stable revenue and minimize customer complaints. We now focus on guiding the overall experience of our customers which is intended to upgrade the experience of customers to one of much greater engagement and satisfaction.

Optimal Utilization of Resources

Our Company constantly endeavors to improve our service process and will increase service activities to optimize the utilizationof significantresources, and intend to further .Wehaveinvested invest in our activities to develop customized systems and processes to ensure effective management control. We regularly analyze our existing policies to be carried out for providing our products which enables us to identify the areas of bottlenecks and correct the same. This helps us in improving efficiency and putting resources to optimal use. We also intend to continue to build on our inclusive culture to ensure our employees remain engaged and committed to delivering exceptional service.

Enhance operational controls to ensure timely completion of Service

We continue to focus on enhancing operational controls and cost efficiencies through optimal service quality & cost management. Our ability to provide timely Completion of Service and quality service is key to our reputation and further expansion of our business. We also continue to implement various measures aimed at incremental improvement in operational efficiencies, such as deploying more professionals for providing services. We also continue to adopt industry best practices and training for our employees to provide the best services to our customers.

To Build-Up a Professional Organization

We believe in transparency, commitment, and coordination in our work, with our suppliers, customers, government authorities, banks, etc. We have a blend of experience and sufficient staff of our day-to-day operations. We also consult with external agencies on a case-to-case basis on the technical and financial aspects of our business. We wish to make it sounder and stronger in times to come.

	SWOT ANALYSIS
Strengths
Quality Assurance and Standards
Experienced Management Team
Satisfied customers with quality and service
Strong business model
Established operations and a proven track record
Weakness
Dependency uponsuppliers
Increasing working capital requirement
Insufficient market reach
Opportunities
Potential to provide other value-added services
Expanding geographically
Opportunities in the Indian Market
Government thrust for development will boost a rise in demand

Threats

Competition

Change in Government regulatory norms Rising labor wages Volatile Matel Market

Internal control system:

Your Companys internal controls systems are commensurate with the nature and size of its business operations. Adequate internal Audits and internal controls, systems and checks are in place and the management exercises financial controls on the operations through a well defined processes.

Segment wise performance/ Discussion on financial performance with respect to operational performance:

The Company has only one segment i.e. business of Power transmission, Distribution, and Industrial EPC space projects (Engineering, Procurement, and construction. The Company earned operational income of Rs. 3615.17 lakhs compared to Rs. 3261.26 lakhs for the previous year. The other income is Rs. 9.84 lakhs compared to Rs. 43.42 lacs in the previous year.

The total revenue for the year is Rs. 3625.00 lacs against Rs. 3304.67 lakhs in the previous year. Profit after tax is Rs. 300.88 lakhs as compared to previous year figure of Rs. 279.82 lakhs.

Material developments in Human resources / Industrial Relations front, including number of people Employed:

Our Company believe that our employees are key contributors to our business success and its ability to maintain growth depends to a large extent on our strength in attracting, training, motivating and retaining employees. We focus on attracting and retaining the best possible talent. Our Company looks for specific skill-sets, interests and background that would be an asset for its kind of business. As on

March 31, 2023 our Company has 35 employees on payroll.

Our manpower is a prudent mix of the experienced and youth which gives us the dual advantage of stability and growth. Our work processes and skilled resources together with our strong management team have enabled us to successfully implement our growth plans. Also we hire contract labour at our site as per the requirement. The Company has tie ups with skilled and semi-skilled manpower suppliers across the country. Majority of our labours are supplied from West Bengal, Rajasthan, Jharkhand and Gujarat. It also hire local labours as per requirement at our Projects.

Details of significant changes (i.e. Change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with details explanations as

Ratios	Current Financial Year 2022-2023	Previous Financial Year 2021- 2022	Details Explanations
Debtors	4.57	6.71	Decreased preliminary due to high conversion cycle of trade receivables
Turnover Ratio Inventory	15.72	17.85	pursuant to slower collection efforts. -
Turnover Ratio Interest Coverage Ratio	6.33	5.66	Increase in interest coverage ratio on account of lower interest cost & higher earnings available for coverage of same.
Current Ratio	1.85	0.94	Current Ratio has improved on account of significant increase in current assets and reduction in overall trade payable. Debt equity ratio has improved
Debt Equity Ratio	0.56	0.96	primarily due to increase in equity
Operating Profit Margin % Ratio Net Profit	25.53%	24.65%	share capital, pursuant to fresh issue. -
Marin % or sector-specific equivalent ratio (as Applicable )	8.32	8.58	-

Details of any change in return on Net worth as with immediately previous financial year:

Net worth increased from Rs.678.49 lakhs to Rs.1794.37 Lakhs due to increase capital base, share premium and reserves of the Company.