Industry Structure and Development:

Real Estate
Driven by positive growth in the economy, real estate industry in India is booming. The Company is in continuous process of making a vivacious presence for itself in real estate Industry and has undertaken Projects.

Opportunities and Threats:
The organized retail sector is expected to grow stronger than GDP growth in the next five years driven by changing life styles, strong income growth and favorable demographic pattern. The annual growth of departmental stores has been estimated at faster pace, which is faster than overall retail; and super markets have taken an increased share of general food and grocery trade over the last two decades.

However, the players in the organized sector have to face big challenges as they have huge expenses to meet, and yet have to keep prices low enough to be able to compete with the traditional sector. High costs for the organized sector arises from: higher labor costs, social security to employees, high quality real estate, much bigger premises, comfort facilities such as air-conditioning, back-up power supply, taxes etc. Organized retailing also has to cope with the middle class psychology that the bigger and brighter sales outlet is, the more expensive it will be.

Segment wise Performance:
A detailed segment report is prepared and presented at Sr. No. 22 (b) in Notes to Accounts appearing under  “Notes to Accounts” (Significant Accounting Policies and Notes to Accounts) forming part of Balance Sheet.

The Company has projected a sizeable growth in the organized retail sector, which seems to be achievable in view of the better growth prospects for the retail industry. The primary focus will be centered on consolidating capabilities and building market standing. Over the time, it is the objective to gain a leadership in the organized retail industry.

Risks and Concerns:
Today retailing is not officially recognized as an ‘Industry’. This may affect financing prospects and hence a negative impact on the growth of the industry. Proposals are underway to open the sector for International Companies also. This will see a further segregation of the international retailing brands and the domestic retailers, thereby injecting much greater dynamism in the market. The big established enterprises in the organized retail sector having their business operations in metros are expanding their roots in the State of Uttar Pradesh as competitors.  

Internal Control System and their Adequacy:
The Company has in place adequate internal control system covering all its operations in order to provide reasonable assurance with regard to information and maintenance of proper accounting records, the economy and efficiency of operations, safeguarding of assets against unauthorized use or losses, and the reliability of financial and operational information.

The Internal Control mechanism comprises a well-defined organization structure, pre-determined authority levels and clearly defined policy guidelines for appropriate delegation of authority.

Financial Performance with respect to Operational Performance:
The Financial performance of the Company has been given separately in the Directors’ Report.

Material Developments in Human Resources / Industrial Relations:
The Company firmly believes that “People” and “People driven Strategies” are the pivotal force behind success of its growth. The HR philosophy is communicated to the employees through various group interactions with the Top Management. In order to ensure that its HR philosophy is translated into demonstrated action, the Company has sound, pro-active and progressive HR strategy and practices.

Cautionary Statement:
Statements in the Management Discussion and Analysis describing the Company’s objectives, projections, estimates, expectations may be “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include, among others, economic conditions affecting demand/supply and price conditions in the domestic market in which the Company operates, changes in the Government regulations, tax laws and other statutes and incidental factors.