Some of the information contained in the following discussion, including information with respect to our plans and strategies, contain forward-looking statements that involve risks and uncertainties. You should read the section “Forward-Looking Statements” for a discussion of the risks and uncertainties related to those statements and the section “Risk Factors” for a discussion of certain factors that may affect our business, financial condition or results of operations. Our actual results may differ materially from those expressed in or implied by these forward-looking statements. Our fiscal year ends on March 31 of each year, so all references to a particular fiscal are to the Twelve-month period ended March 31 of that year. In this section, a reference to the “Company” or “we”, “us” or “our” means AVAX APPARELS AND ORNAMENTS LIMITED.
All financial information stated in this section is extracted and therefore should be read together with, the more detailed financial and other information included in this Draft Prospectus, including the information contained in the sections titled “Risk Factors” and “Financial Information” beginning on pages16 and 144 respectively.
BUSINESS OVERVIEW
The Company engages in two distinct lines of business:
- Wholesale trading
- Online retail of silver ornaments
Wholesale trading:
The Company operates in the wholesale trading of knitted cloth. They directly buy from manufacturers and supply wholesale to companies and readymade garment manufacturers in Punjab. The company specializes in knitted cloth, which are used for manufacturing of ladies and gents’ jackets.
The company’s key advantages in wholesale trading include a geographical advantage, being located in the hub of cloth manufacturing. Additionally, the growing demand for these products and the strong business relationships of the management also contribute to the company’s success in this segment.
Online retail silver ornaments business:
The Company operates in the business of online retail of silver ornaments. They offer a wide range of designs and articles with a choice of weight of products, such as silver rings, silver ladies pajeb, silver gents kada, silver plate set, silver glass, silver bangles, silver bowls, silver chains, and other silver jewellery. They are capable of supplying in all major cities across the country.
The company’s key advantages in this business include operating in the affordable silver ornaments sector, an increase in demand for silver ornaments in Indian markets, the ability to replicate gold jewellery designs in silver, and access to exclusive Punjabi ethnic designs.
Our company is led by two promoters namely, Mr. Harinderpal Singh Sodhi as Managing Director and Mr. Harish Kumar as Executive (Whole Time) Director of the Company. Mr. Harinderpal Singh Sodhi worked as a Business Manager at Guru Nanak Kissan Sewa Kender from March 2014 to March 2022 and Mr. Harish Kumar worked as a business proprietor at Kunika Traders- Muktsar from May 2013 to March 2022.
SWOT ANALYSIS
| Strength | Weakness |
| ● Locational advantage
● Good network and connections with the players in the Sector ● Excellent Customer Relations ● Experienced and professional Team ● Good Track record of the management
|
● Limited financial resources
● Limited pricing power due to emerging competition ● Limited experience specifically in silver ornament sales. |
| Opportunity | Threats |
| ● Government thrust under Make in India Policy
● Good demand knitted cloth and silver ornaments, the demand is expected to grow further ● Positive Government Initiatives ● Increasing share of the market
|
● Changes in government policy
● Exposure to sharp changes in raw material prices.
|
DETAILS OF THE MARKET
Knitted Cloth:
The knitted cloth market in India is a significant contributor to the country’s textile industry, with a wide range of products being produced and exported to various countries around the world.
The Indian knitted cloth market is known for its high-quality products and competitive pricing, which has helped it to establish a strong presence in the global market. The major products being produced include t-shirts, sweaters, jerseys, and other knitwear garments, which are exported to countries such as the United States, Europe, and the Middle East.
The Indian government has implemented several measures to support and promote the growth of the knitted cloth market, including providing subsidies and incentives to textile manufacturers and exporters. Additionally, the government has set up special economic zones and textile parks to attract investments and encourage the growth of the textile industry.
The knitted cloth industry in India is also known for its large number of small and medium-sized enterprises (SMEs) which play a vital role in the production and manufacturing of knitted cloth. These SMEs are known for their flexibility and adaptability, which allows them to quickly respond to the changing market conditions and customer demands.
However, the knitted cloth market in India also faces some challenges such as the competition from cheaper imports, lack of modern technology and the high cost of raw materials. Despite these challenges, the market is expected to continue growing in the coming years, driven by increasing demand for high-quality knitted cloth products in the global market.
Overall, the knitted cloth market in India is a vital contributor to the country’s textile industry, with a wide range of high-quality products being produced and exported to various countries around the world. Government support, a large number of SMEs and adaptability to changing market conditions have helped the market to establish a strong presence in the global market.
Online retail of silver ornaments:
The online market for silver ornaments in India is a rapidly growing industry, with a large number of websites and e-commerce platforms offering a wide range of silver jewellery products. Some of the key players in the Indian online silver jewellery market include Bluestone, CaratLane, and Tanishq, which offer a wide range of silver jewellery products such as silver earrings, silver bangles, silver chains, silver pendants, and silver rings.
The silver ornaments market in India has grown significantly in recent years, driven by factors such as increasing disposable incomes, changing consumer preferences, and the growing popularity of online shopping. The market is also driven by the increasing use of social media platforms and digital marketing, which have made it easier for consumers to discover and purchase silver jewellery products online.
In terms of product offerings, the Indian online silver jewellery market is highly diversified, with a wide range of products available to cater to different tastes and preferences. From traditional designs to modern and contemporary styles, the market offers a variety of silver jewellery products to suit different occasions and budgets. Many of the online marketplaces also offer customization options, allowing customers to design their own silver jewellery products.
In terms of pricing, the Indian online silver jewellery market is competitive, with a wide range of products available at different price points. Prices of silver ornaments depend on the weight, design and craftsmanship. The online retailers also offer discounts and deals throughout the year, making it more affordable for consumers to purchase silver jewellery products.
Overall, the online market for silver ornaments in India is a rapidly growing industry, with a wide range of products, competitive pricing and a lot of options to choose from. Due to the COVID-19 pandemic, the online market has seen a surge in the demand for silver ornaments as people were hesitant to visit physical stores.
BUSINESS PROCESS
Process of wholesale trading business is described below: –
Our Company acts as a trader, purchasing finished goods from manufacturers of knitted cloth and storing them in their warehouse. We then sell these goods to manufacturers of readymade garments.
Process of silver ornaments business is described below: –
Our Company purchases silver ornaments from jewellers and sells them online to the end consumers.