MANAGEMENT DISCUSSION AND ANALYSIS REPORT Statement in this Management's Discussion and Analysis detailing the Company's objectives, projections, estimates, estimates, expectations or brdictions are "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those exbrssed or implied. Important factors that could make a difference to the Company's operations include global and Indian demand-supply conditions, finished goods prices, feedstock availability and prices, cyclical demand and pricing in the Company's principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the Company conducts business. INDUSTRY STRUCTURE & DEVELOPMENT • The year 2014-2015 witnessed smartphones be launched and exclusively sold on online market places and e-commerce sites in India was significant., 2016 will be crucial in defining the Indian telecom market.. Wide availability of 4G will lead to its wider adoption thereby increasing the 4G subscriber base. There will an influx of 4G handsets at entry and mid-segments levels due to increased demand for 4G devices. Increase in 2G data tariffs to bridge the gap between prices thereby prompting subscribers to adopt 3G and 4G. Indian telecom market is competitive with 12 players and there is a need for consolidation in the industry so that the players can operate more efficiently and hence industry is already moving towards consolidation. Value added services have gone down considerably. Operators are not looking at VAS as source of additional revenue. Rather they have shifted focus on content like music and videos which will rather push their voice revenues. The key reason for this shift is due to the way the customers have started consuming data. CDMA voice subscribers have continued to decline over the year with a negative growth rate while they make a switch to GSM services. OPPORTUNITIES AND THREATS • Corroded cable lines, slow service and lackluster sales are three weaknesses that can hurt a telecommunications company. Company weaknesses are competitive deficiencies that place the company at a disadvantage in the marketplace. If corroded cable lines aren't replaced and slow service continues, for example, angry customers will switch to a rival telecommunications company that offers better services. • New technologies, increasing consumer interest and a decrease in competition are just a few external opportunities that can really help a telecommunications company in the long run. Opportunities are beneficial, outside events that a company can use to boost its existing strengths. A telecommunication company keen on rapidly adopting new technologies, for example, would highly benefit from immediately investing in new fiber optics the moment they're introduced in the marketplace, especially if they speed up service. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE • Shyam being a local Company lends strength to the growing motto in the Country with 'Make in India' concept. There has been a paradigm shipt in the conceptualization of manufacturing products. OUTLOOK • Most of the new operators have issues with the Capex and they are looking for products which can meet their coverage requirements and satisfy customers. RISKS AND CONCERNS • Shyam Telecom actively stimulates entrebrneurship throughout the organisation and encourages its people to identify and seize opportunities. The current economic environment, in combination with significant growth ambitions, carries with it an evolving set of risks. We recognize that these risks need to be managed to protect customers, employees, shareholders and other stakeholders, to achieve business objectives and enable sustainable growth. Risk and opportunity management is therefore a key element of the overall strategy. This section provides an overview of the key strategic risks, risk and control framework, and its approach to risk management. For expansion and modernization, the company has so far managed to optimize its internal resources to maximum extent. However to cater needs of new buyers the company would be needing investment and various fund and non fund based facilities from banks and financial institutions which are generally hesitant to support trading activities. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY The Company has in place adequate internal financial controls with reference to financial statements. The Company has an Internal Audit team besides external firms acting as independent internal auditors that reviews internal controls and operating systems and procedures. A dedicated Secretarial & Legal team ensures that the Company conducts its businesses with high standards of legal and regulatory compliances. The Company also has an Audit Committee, whose members interact with the Statutory Auditors, Internal Auditors and Management in dealing with matters within its terms of reference. This Committee mainly deals with accounting matters, financial reporting and internal controls. During the year, the Company continued to implement suggestions and recommendations of auditors to improve the control environment. Financial performance of the Company is in line with the operational performance. The note on industrial relations has already been provided in the Director's Report. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively. The Board takes note of this periodically in their meeting On Behalf of the Board of Directors of SHYAM TELECOM LIMITED Sd/- AJAY KHANNA Managing Director Sd/- N KUMBHAT Director |
