V-Guard Industries

What title-holderted in 1977 with devil employees and a burning passion is now a bear on to reckon with in the Indian electric and electronic comput competents panorama. Our untiring inscription for per relieve oneselfance, cutting edge engine room, innovative design and depend up to(p) service standards fork extinct lead to unriv aloneed crossroad quality and a trusted stigma emblem. At V-Guard the principles that motivated our success re principal(prenominal) unchanged The passion of our earlyish divisions and our quest for excellence.Through stringent quality measures, reli suit competent products, talented battalion and a responsible approach to business and global citizenship we continue to steadily capture the hearts of the people. In 1977, Koc sufferph Chittilappilly began a small manufacturing unit for voltage stabilizers with a vision and a capital of Rs 1,00,000 borrowed from his father. He soon completed V-Guard Industries as a household name. V-Guard beca me the synonym for voltage stabilizers across in the south India.The comp whatever soon extended their tramp of products to include Pumps & Motors, Electric pee fastballs, Solar Water Heaters, Cables, UPSs, and Ceiling Fans. V-Guard continues to remain at the helm finished sozzled reoceanrch and information. R&D labs at Cochin and Coimbatore search and reinvent breathing products and design. R&D for electronic products and electric geysers atomic snatch 18 carried out in Cochin while electro-mechanical products, electrical wires and solar weewee heaters ar the laborious V-Guard continues to remain at the helm by rigorous research and development.R&D labs at Cochin and Coimbatore explore and reinvent existing products and design. R&D for electronic products and electric geysers argon carried out in Cochin while electro-mechanical products, electrical wires and solar pissing heaters are the strong closure of the Coimbatore R&D lab. State of the art production centi meres visualize amity and quality throughout the product range. Workforce world the sum of money asset of any organisation, V-Guard has an employee strength of more(prenominal) than 1750 and everyplace 5500 in luff employees through its SHG initiatives.With over cc distributors and service centres and more than 10,000 retailers serving the motives of over 50 billion customers, V-Guard stands as a grocery store leader. News Investor traffic CSR Careers meeting Us Privacy policy Terms of use disavowal berth be given 2011 emf Stabilizers, Electrical Wires, Water Heaters, Water Pumps, Voltage Stabilizers V-Guard Industries Ltd. all in all Rights Reserved sack Design springed by DREEME point of the Coimbatore R&D lab. State of the art production centres see consistency and quality throughout the product range.Workforce being the core asset of any organisation, V-Guard has an employee strength of more than 1750 and over 5500 indirect employees through its SHG initiatives. With over 200 distributors and service centres and more than 10,000 retailers serving the needs of over 50 million customers, V-Guard stands as a securities industry leader. News Investor Relations CSR Careers Contact Us Privacy policy Terms of use Dis yeller Site Map 2011 Voltage Stabilizers, Electrical Wires, Water Heaters, Water Pumps, Voltage Stabilizers V-Guard Industries Ltd.All Rights Reserved Web Design world-beatered by DREEME About us CSR * Directors * V-Guard Story * note Control We believe in the amalgamation of corporate focal point, sustainable development and global responsibility in working toward a better parliamentary law and thereby a better world. We are committed to greening our environment, keep the less fortunate and nurturing the downtrodden. Extending a hand in support of culture Kerala industrialist donates kidney to save a vivification ROTARY-BINANI ZINC CSR pillageV Guard Industries was awarded the ROTARY-BINANI ZINC CSR AW ARD (Private Sector) by the Rotary Club of Cochin Metropolis, in association with NIPM Kerala Chapter and ICAI, Ernakulam ramification for Best Corporate Social Responsibility Initiative by a company in the State of Kerala. Our Joint Managing Director Dr. George Sleeba receiving the award. The Thomas Chittilapilly perpetrate The Thomas Chittilapilly Trust was founded by Kochouseph Chittilapilly, in memory of his late father, C. O. Thomas. It is an lengthiness of the philanthropic and responsible values espoused at V-Guard.It is dedicated to extending its r separately to areas of health, grooming and care. The trust provides health insurance cover for 1314 families from financially backward classes, 922 families at Tholur Panchayat, Kerala and 105 families in Ramanagaram Taluk in Bangalore, Karnataka. It in care manner conducts impoverished health camps at villages and backward areas where the reach of proper health care is absent. It sponsors the education of 1587 inculcate c hildren from economically backward sections in Thrissur and Ernakulam Districts in Kerala and Ramanagaram Taluk, Bangalore.The trust has as well as do substantial contributions to NGOs working for unhomogeneous social eudaimonia causes like Udhavumkarangal and the SOS village. It has overly donated generously to more national level causes and residual funds like the Prime diplomatic ministers Relief entrepot, Kargil war victims, relief for the earthquake victims of Latur and Gujarat, victims of the Orissa cyclone and the Tsunami Relief Fund of the Prime Minister as well as the Chief Minister. Shantimandiram An old age home for women, providing shelter and care for those who are unable to care of themselves in Parappur Village, Trissur, Kerala.It is managed by the Sisters of CMC Nirmala Province in whose able hand the inmates receive love and care irrespective of caste and community. The celerity accommodates 60 inmates at a time and is recognised by the bestride of Cont rol for Orphanages and another(prenominal) Charitable groundworks, Kerala. True to its name, all facilities are provided free of address and it is a haven of peace and tranquility where the inmates cut down the flush of their lives in dignity and comfort. Shanthimandiram celebrated its first anniversary on twenty-ninth May 2010 along with the Inmates. The function started with the blessings of Fr. Franko Kavalakkatt, Vicar, Parappur Forona Church.Various ethnic broadcasts have been performed by the inmates of Shanthimandiram. The function got enriched with the Folk dance by Managing Trustee and family. The sisters of Shanthimandiram withal involved with the cultural programmes. Social Welfare Fund- an employee CSR activity Social welfare consciousness being embedded in V-Guard work culture has motivated the employees to join hands in reaching out in charity. The Social Welfare Fund was created out of the cheeseparingwill of the employees who collate funds and donate towards terms of medicines for the paltry in the cancer ward at the Ernakulam General Hospital.Stabilizer SHG activity Since its fount V-Guard has been providing a mutually beneficial income generating option to women. Women who have grouped themselves to form SHGs (Self Help Groups) are distributed assembly kits for voltage stabilizers. An in force(p) dissemination and collection system give the axe profitworks the women with the company and has been a resounding success for decades. It provides a stable income for their households and in turn emancipation from poverty. News Investor Relations CSR Careers Contact Us Privacy policy Terms of use Disclaimer Site Map 2011 Voltage Stabilizers, Electrical Wires, Water Heaters, Water Pumps, Voltage Stabilizers V-Guard Industries Ltd. All Rights Reserved Web Design situationed by DREEME About us The V-Guard counseling * V-Guard Story * Quality Control * CSR He is a localize graduate in Science, majoring in Physics from Calicut Un iversity. He started his career as a supervisor in an electronics company, where he worked for three course of studys. In the course 1977, he started a SSI Unit engaged in the manufacturing and selling of electronic Voltage stabilizers. He is one of the fo chthonic Promoters and has motivated the guild to pull through in its business.He has been the Managing Director of the party since its inception and has detractn high society to its underway levels of stature and recognition with his experience and vision. In April, 2012 he passed the baton on to his son Mr. Mithun Chittilapilly as the Managing Director, assuming the pip of Executive Vice head of the company and on November 1, 2012, when Shri. P. G. R. Prasad stepped down, he took over as the Chairman of the hop on of Directors. He is the recipient of numerous awards, which were bestowed on him for his exemplary performance in business.Among them are stress of credit Man of the Millennium 2000 from Rashtra Deepika, Tourism Man of the course of instruction from Destination Kerala and Samman Pathra honour for top income tax payer from Honble Union Minister of State for finance. As the Managing Director, Mr. Kochouseph has been the main driving force behind the companys carry on harvest-time. more Shri. Cherian N. Punnoose, a Fellow piece of Institute of Chartered Accountants of India, coupled V-Guard as Vice Chairman of the Board of Directors. Formerly Director of finance at Kochi Refineries Ltd. (KRL), he was excessively on the Board of Pertonet CCK Ltd.He has 40 old age of experience in the field of Finance, Audit and judiciary. Served KRL for 25 familys in unhomogeneous capacities prior to be advance a member of the Board of Directors. prior to joining KRL he in any case served Bharat Heavy Electricals Limited and International Airports leave of India. He has undergone short term training in Advanced fiscal steering Techniques in Strathclyde Business School of the University o f Strathclyde, Glasgow, UK He is a grad student in commerce, Certified Financial Planner and a Research apprentice with School of Management Studies of Cochin University of Science and Technology.He joined the company as an Independent Director on 16th August 2007. He is a member of Executive Committee of discipline Stock Exchange of India Ltd. , subject field Securities Depository Ltd. , BNP Paribas Personal Investors, Paris and Cochin Chamber of Commerce and excessively a Managing Committee member of ASSOCHAM and KMA. He is also a member of Confederation of Indian Industry, Kerala State Council and Capital Market Committee of union of Indian Chambers of Commerce and Industry. Charter member of Tie, Kerala.He has also been awarded the Business Man of Kerala by Business Deepika, Excellence Award from Kerala Management tie beam and Dhanam Business Man of the Year, 2006. Presently, he is the Managing Director of Geojit BNP Paribas Financial Services Ltd Mr. Nair was institute a s the Non Executive Independent Director of the confederation on twenty-seventh May 2009. Mr. A K Nair holds a Bachelors tip in Mechanical Engineering with Masters in Business Administration and has over 45 courses of Industry experience specially in the filed of Engineering, Finance and General Administration.Mr. A K Nair has served Kerala State Industrial maturement Corporation and Nitta Gelatin India limited as Managing Director and is presently on the Director Board of many other companies. He is a post graduate in Finance from University of Melbourne, Australia. Mr. Mithun K Chittilappilly after completing his first in Commerce joined V-Guard to be trained in the various departments of the company, ranging from Finance to Marketing.In January 2005, he took a break from work for a division and a half to pursue his post graduation in Finance from University of Melbourne, Australia. After graduating in May 2006, he joined the alliance as Executive Director and in 2012 was a ppointed as the Managing Director of the guild. Dr. Sleeba has been inducted as an Additional Director of the Company with effect from 27th May, 2010. He has also been appointed as the Joint Managing Director of the Company with effect from beginning(a) June, 2010. Dr.George Sleeba is a Graduate in Mechanical Engineering with First family Honours from Kerala University and M Tech in Industrial Engineering from IIT, Madras, Dr. Sleeba has a Post Graduate Diploma in Management from All India Management Association (AIMA) and Doctorate in Social Sciences from the Cochin University of Science & engineering science (CUSAT). He has undergone a three month Senior Management programme as a Colombo Plan Scholar in UK organised by the British Council and holds a certificate in Training & organic evolution from the Institute of Training & Development, UK.Dr. George Sleeba was the Former Chairman and Managing Director of item Ltd, a multidivisional corporation with more than Rs. 2300 Cr ores dollar volume and 4000 employees the macrogest Central PSU in the State of Kerala. He has proven managerial competence and academic excellence. He has more than 38 divisions of outstanding contribution to the manufacturing in various useful areas of management, of which 30 divisions had been in FACT in senior management positions such as General Manager, Executive Director, Technical Director and as Chairman & Managing Director.He had been the Managing Director of two State Govt Undertakings Travancore Cements Ltd and Travancore Sugars & Chemicals Ltd. He has also served as a Consultant to the Govt of Kerala for revival of sick units in the Public Sector. He is a member of the Industrial Relations Board of the Govt of Kerala. He is recognise as a turnaround specialist, credited with transforming the ailing FACT into a egress oriented, diversified, profit making company.In recognition of his contribution to the industry, he has been awarded the Lal Bahadur Shastri Nati onal Award for professional excellence in public sector, Padmasree Paul Pothen Award for professional excellence, Merit Award from FACT for outstanding performance, Jaycees Award for prosodion Achievement, Rotary International Award for outstanding professional from industry, Life measure Achievement Award from NIPM from Palakkad Group, Outstanding Achievement Award for revival of FACT from Kerala Darshana Vedi an NGO.Management Discussions 1. ECONOMIC SCENARIO AND INDUSTRY OVERVIEWAfter the global economic recession, many of the world economies are growing in a belatedlypace even today however, the Indian sparing had showed faster recovery from the secondhalf of 2009-10 and has achieved robust and steady economic ingathering during the fiscal2010-11. With striking development in major sectors like agriculture, manufacturing,services, automobiles and realty, the countrys gross domestic product rate has grown by 8. 5% during thefiscal 2010-11.Indian consumer industry also witn essed true maturement during the year under re visit. Increasing urbanisation coupled with racy spendable income of individuals and a surge inadvertising has been instrumental in bringing approximately a sea change in the consumer behaviorpattern and has resulted in ontogenyd consumer spend towards branded products twain in campestral and urban markets of India. 2. OVERALL PERFORMANCEV-Guard continues to enjoy a booster cable position in the electrical and electronic consumermarket in the country.With a huge variety of products, strong brand equity and widelyspread distribution channel, the Company enjoys a unique position to cater to the consumerneeds of various portions. The Company achieved net barters of Rs. 726. 34 crores during theyear under canvass, charting a growth of 59. 96%, over the net gross revenue of Rs. 454. 09 croresfor the introductory year. Following the robust growth achieved in cut-rate sales, the Company recordeda Net Profit of Rs. 39. 70 crores , without considering exceptional profit of Rs. 3. 63crores during the year under review, which is 55. 84 % more compared to the previous year.The contribution from Non-South Indian markets in the disorder is more than Rs. 160. 00crores in the fiscal 2010-11. The products that accounted more to achieve the sales werewires, stabilizers and pumps. billet REVIEW3. 1 VOLTAGE STABILIZERSThe Companys flagship product Voltage Stabilizers has achieved a turnover of Rs. 166. 82 crores during the year under review, which is 23% of the total net sales. Pursuantto the surge in the consumer durable industry there was a world-shaking increase in the saleof white goods like refrigerators, air conditioners, washing machines and so forth which hasresulted in an increase in the sale of stabilizers for air conditioners, refrigerator and so forthDuring the year under review, the product has grown by 44. 73% in value, when compared withthe sale of previous year. New models of stabilizers meant for ai r conditioners were introduced considering thelocal requirements of non-south Indian markets with reduced cost. New models were alsointroduced for stride mill, washing machine and micro wave oven. The Companys unrelenting efforts o keep abreast the quality of the product, bringingout improvements on an on-going basis by introducing in the raw models that meets the localmarket conducts, focused R & D efforts and strong channel network across the country,have all contributed to maintain its dominant position in the sector. The main terror faced in the product line is the seasonal nature of many of the whitegoods and the aggressive campaign by the manufacturers of the white goods stating that theappliance contains in-built stabilizers. Besides these, the increase pompousness rate,competition from the unbranded fraction, improved power distribution etc.May hamper thefuture growth of the product. During the year under review, the Company came out with an ad campaign to overcome t heimpact of the claim of the manufacturers of the white goods that their appliance containsin-built stabilizers which has helped to create awareness on the retailers and customershow the stabilizers protects the appliance during the power cut and also from the voltagefluctuation when the power comes back. Through this awareness creation ad, it was able tocreate a positive impact on the mindset of the consumers on the need for a stabilizer.Your Company is expecting the consumer industry to grow in a good pace in the currentfiscal and this will create an increased ask for appliances like LCD TV, refrigerators,air conditioners and consequently an baronial growth in the stabilizers suitable forthese appliances. counseling is being given to expand the market network to rural marketsand other untapped markets as well as to increase the sale in the forward-looking segments ofstabilizers for LCD TVs, tread mill, washing machine etc. 3. 2 WIRING CABLESYour Company is one of the leading manufacturers of wires in the branded segment in thecountry.Total sales achieved in the wire segment for the year under review was Rs. 206. 05crores and it accounted for 28. 40% of the total net sales of the Company. Growth during the year under review was driven by the increased demand from sectorslike structure and construction, automobile, aviation, heartiness, engineering andtelecommunications. Construction industry has revived considerably, after the economicslowdown and as a result, there is an overall improvement in the demand for wires. Thegrowth in the sales in terms of quantity and value was 35% and 68% respectively, whencompared with the sales of previous fiscal.Capacity utilisation of the factories werealso considerably improved during the year under review. step-up in the volume andefficient purchase of raw-materials resulted in better sales growth and profitability. The major strength of this product segment is good network for distribution, increasedbrand image in south and non-south Indian markets and better quality of products. However,brand awareness is to be further increased in the non-south Indian market and efforts areto be make to procure more orders from Govt. departments, various public and mysticsector organizations etc.Moreover, high volatility in the equipment casualty of the majorraw-materials is one of the major reasons for low margin. riskiness associated with theincrease in bull price can be mitigated by efficiently grooming the procurement ofcopper and also keeping the inventory of wires at low levels. As major growth sectors in the country is expected to come out with impressive growthduring the fiscal 2011-12, the way ahead for the product seems to be good and focus willbe given to tap the latent in the rural part of the country and also increase themarket share of the non-south Indian market.As the construction industry is expected togrow further, efforts shall be made to procure more project / institutional orders . 3. 3 PUMPS AND MOTORSDuring the year under review, the Company was able to achieve check into growth in thepump segment consisting of single and three phase pumps. brilliant sales was achieved inthe first half of the fiscal, however due to the extended monsoon, growth was sluggishduring the second half. Total sale achieved was Rs. 121. 00 crores, showing a growth of 42%over the sales achieved during the financial year 2009-10.The product line was able tocontribute 16. 65% of the total net sales of the Company. New models were introduced as per the geographical requirements and efforts were madeto increase the brand visibility especially in the non-south Indian markets and also inthe rural and semi urban areas. With the support of more below the line activities,increased penetration was achieved in respect of three phase pumps in point II & tierIII cities. More number of Dealers were appointed in unrepresented areas of non-SouthIndian markets with a view to expand our marketing network.The Company was also able tointroduce 5 star rated models suited for different segments of customers. Sale of the product may pick out change due to climatic conditions and also there is stiffcompetition from the players both in the organize and unorganised sectors. Non- accessibility of skilled man power from the industry may also hamper the growth of theproduct. Your Company is planning to give more preoccupancy in new market segments withproducts like agricultural pumps, motors & industrial pumps and also three phase pumpsin a big way. 3. ELECTRIC WATER HEATERS ( GEYSERS)Electrical products segment has shown a good growth in the country during the yearunder review add to an impressive growth in the product line. Seasonal factorslike good monsoon rains, early winters in the northern parts of the country have alsofavoured the growth of the product. During the year under review, the total sale achievedwas Rs. 60. 00 crores which is 62% over the previous years sale of R s. 37. 00 crores. Sale of Gas water heaters introduced in the previous year was extremely good.Dealer network for the product was considerably increased both in the urban as well asrural markets. During the year under review, more number of economy models was introducedbesides 5 star rated models that ensures reduction in the drill of energy. Your Companywas able to introduce vitreous enamel tank to increase the life of the tanks and thischange has been well accepted in the market. The product has got good market potential in non-south India due to the climaticcondition and the same can be capitalized by increasing the brand awareness and also theconfidence level of the Dealers.In case, the sale price of solar water heaters gets reduced considerably in future dueto alternate technology in manufacture or by grant of high pension by the Government,there is a likelihood of certain segment of customers shifting to solar water heatersthereby affecting the sale of electric water heaters to some extent. Moreover, powershortfall plethoric in many parts of the country and increasing cost of power may alsoaffect the future growth potential of electric water heaters.Your Company is planning tointroduce new models and more star rated models to reduce energy exercise and forreduction in operational costs as a strategy to maintain the growth pulse. 3. 5 SOLAR WATER HEATERSWith a view to follow electrical energy by curtailing power consumption in house holdappliances and industrial equipment, the Government is encouraging the use of alternate orrenewable energy in place of electrical energy in a massive way. Further, to throw out theuse of solar thermal devices for heating water, the Government has introduced subsidy tothe end consumer.Many nationalized banks are also providing loans at cheaper interestrates for purchase of solar water heaters. Many of the acres governments in the countryhave mandated the use of solar water heaters in moneymaking(prenominal) segments facilitating increasedsale of higher(prenominal) capacity industrial and commercial models. These steps are expected toaccelerate the growth of the solar water heater industry in the approach years. To take advantage of the emerging scenario, your Company has introduced solar waterheaters with improved and innovative designs for vary applications with a view toexpand its market share in domestic and commercial segments.During the year under review,the marketing network for sales of solar water heaters was reorganized with introductionof direct sales to customers in major cities, to facilitate getting more project orders. Your Company is also enjoying superior technology in the manufacture of solar waterheaters that give longer life of inside(a) firebrand tanks, thus providing an edge over thecompetitors in the segment. All these efforts have resulted in increasing the turnover of solar water heaters toRs. 22. 00 crores during the year under review registering a growth of 34% o ver theprevious years turnover of Rs. 6. 40 crores. Considering the future growth potential, your Company is on the threshold of set upa major manufacturing facility for solar water heater with improved technology atPerundurai, near Erode, Tamil Nadu, in the land taken on direct from SIPCOT and the newmanufacturing unit is expected to be commissioned by the third prat of the fiscal2011-12. This improved technology is intended to mitigate the present problem of corrosionof inner tank of solar water heaters in hard water areas. An investing funds of Rs. 8. 00 croresis envisaged for the project.Your Company has also initiated the process for obtainingCRISIL rating for Solar Water Heater Division, that will help the consumers toavail the subsidy announced by the Ministry of New and renewable Energy (MNRE)while making purchases of solar water heaters. However, possibility of further increase inlending rates may have a negative impact on the purchase of solar water heaters utilizingt he loans from commercial banks. 3. 6 FANSGrowth in the electrical products segment in the country has supported the fan industryalso to achieve an impressive growth in the year under review.In 2010-11, your Companyachieved a net sale of Rs. 53. 00 crores, which shows 107% growth over the net sale of Rs. 25. 60 crores, recorded in the previous year. in effect(p) range of products in the ceiling fansand new models of table, radical and wall mounting fans through imports and decorativemodels in ceiling fans have enabled the Company to achieve higher sales and improve theprofitability in the product line. The Company was also able to improve the sale in thenon-south Indian market by appointing more number of channel partners and alsoconcentrating in the rural markets of various parts of the country.As the booming construction industry is expected to give a fillip to the electricalsegment industry, Your Company is confident of increasing its market share in the comingyears in the produ ct line. It is also planned to appoint more number of dealers in theunrepresented areas to expand our marketing network. Your Company is also carrying outcontinuous R & D activities in its pilot production unit located at Kala Amb, toreduce the cost of production, improve the quality and reliability and to introduce lessenergy consuming models.More thrust is also given to capture more projects orders both from the Public andPrivate sector organizations. It is also proposed to introduce industrial exhaust fans tomeet the requirement of industry in the coming years. Sale of the product is exceedingly dependent on the seasonality and also the growth in therealty sector. If the climatic conditions are not favourable, the sale may get affected. Moreover, competition from the unorganised sector is also a threat. To overcome thecompetition from the unorganized sector, your Company is involved in increasing its brandawareness by doing Below The linage activities.With continuous R&D and at bottomtroduction of more models of energy efficient fans, your Company is confident ofincreasing its market share and profitability in the coming year. 3. 7 POWER & CONTROL CABLESYour Company embarked into manufacture and marketing of LT Cables in 2009 by setting upa manufacturing facility at Coimbatore. LT Power and Control cables are mainly used inpower generation and distribution plants and also in electrical systems within thepremises. As the power sector and construction industry are growing at a faster rate, goodgrowth potential is expected for the product. The Company achieved a net sales of Rs. 2. 00 crores, during the year under review and registered a growth of 165% over theprevious year. Order book consists of clients from major organizations from public andprivate sectors. Good brand image, consistency in quality of products and network withstrong dealers are the main growth drivers in the product line.The Company plans to grow further in the coming fiscal and increa se its capacityutilization by getting more orders from Govt. and private institutions. 3. 8 UNINTERRUPTED POWER SUPPLY (UPS) SYSTEMSDuring the year under review, Indias personal computer (PC) market registered agrowth f 30% which is the highest since the year 2007. closely 25,00,000 PCs were shippedto Indian consumers, raising the overall sales by 26 per cent in the period. The demandfor UPS in India is expected to be robust, especially from rural and semi-urban areas,where the speedy development in the IT infrastructure and elongated power cuts and loadshedding is more, compared to what urban areas experience. During the year under review,the product line UPS has made an incremental growth in sales both in terms of value andvolume.Your Company was able to achieve net sales of Rs. 7. 00 crores, therebyregistering a growth of 56% over the previous years sale of Rs. 17. 36 crores. The factors that drive sustainable growth in this segment are the quality andreliability of products, co mpetitive prices, availability of the product through a widedistribution network and prompt after sales service support. Your Company is adoptingstrategies for penetrating the B and C class cities to ensure growth in this product line. Growth is also expected from hospitality industry as well as educational institutions,where the usage of UPS is more.However, UPS is as an ancillary product of desktop computers and the demand of UPSdepends directly on the demand of desktop computers. The sales growth of Laptops isindirectly affecting the sales of UPS in the ground level I and Tier II Cities. Your Company istaking steps to increase the range of models in the category of Line Interactive UPS andonline UPS for wide range of applications as a strategy for increasing sales. 3. 9 DIGITAL HOME UPSDigital Home UPS industry is poised to grow aggressively in the coming years.The acutepower shortage and load shedding stipulated by various State Governments and frequent longhour power failures h ave contributed to the growth of the product line in a big way. During the year under review, net sale achieved was Rs. 22. 00 crores, registering a growthof 150% over the previous years sale of Rs. 8. 77 crores. In the year under review,the product reach was increased by making it lendable throughout the country byappointing number of Direct Marketing Associates and strengthening the marketing network.Your Company has also introduced battery for the Digital UPS during the fiscal 2010-11. Considering the huge market potential, the Company is confident of increasing the salesmany fold in the coming years. 4. OPPORTUNITIES & THREATSYour Company is engaged in the manufacturing and marketing of various products whichforms part of the segments like electronic and electrical, consumer durable, agriculture,construction and power. Sales growth of the each product vertical is having a direct nexuswith development of the core sectors of the economy.As the Indian economy is on a fastgrowing p ace, all the key sectors are also showing excellent growth. The Indian consumerdurable industry witnessed a tremendous growth during the year under review. Changinglifestyle, higher disposable income coupled with greater affordability, boom in the realestate and housing industry and a surge in advertising has been instrumental in bringingabout a sea change in the consumer behavior pattern. Rural markets and small towns haveshown promising demand for durables and prosperity in rural India has been one of themajor driving forces for rural growth.Though the economy is growing in a fast manner, the high puffiness prevalent in thecountry may affect the growth of the sectors like construction, consumer durables,agriculture etc. It may also affect the purchasing power of the people and slow down themovement of white goods. Besides, consumers are more aware of energy efficient appliancesas they are proactively asking for star-rated refrigerators, air conditioners, waterheaters, pumps etc. I f the Company fails to introduce energy saving models, it will befacing difficult situation to market the products.Moreover, in the highly inflationaryregime, price of the raw-materials may increase considerably leading to increased cost ofproduction. Attempts to pass on the price escalation to the consumer, may lead to, peopleopting for unbranded products, considering the price variation. 5. FUTURE OUTLOOKThe Indian economy is expected to maintain the growth momentum in the coming years. With the existing product range and by introducing new models which suits with the localrequirements of various markets and by providing good after sales service, your Directorsare confident of achieving want growth levels and improve the profitability further.Possibility of adding one or two products coming in the home appliance segment is alsounder consideration. Thrust will be given to strengthen the existing manufacturingfacilities by making additional investment wherever required. Efforts wil l be taken toimprove the brand awareness in the new markets and more penetration will be made in thesemi-urban and rural areas. 6. RISKS AND RISK MITIGATIONThe Company has an Enterprise Wide Risk Management System in place and has laid downprocedures for risk assessment and its mitigation.A two level committee monitors therisks and its mitigation measures on a regular basis. The pooh-pooh level consists of 4Product Risk groups each headed by a VP and comprising of concerned product heads andrepresentatives from other functions like Finance, Systems, Customer Service, HumanResource, Legal etc. The apex body, cognise as Risk Management Team is headed by theExecutive Director and lie in of Sr. Vice Presidents, Vice Presidents, Chief Risk officer, Assistant Risk Officer and heads of various Product Risk Groups as members.The Product Risk Groups holds periodical meetings and review the risks and mitigationmeasures in the respective product groups and submit their reports along with th e minutesof the meetings to the Risk Management Team, which review and consolidate the Risk reportand submit quarterly reports before the Audit Committee for its review and recommendationto the Board. The Company is also maintaining Risk Registers for each product and the sameare updated on regular basis.