Sensitivity Analysis Summary

Investor Relations

 

Sri Trang Agro-Industry Public Company Limited has monitored fluctuated situations that have a significant impact on business performance and provided the business sensitivity analysis by considering external factors, both financial and non-financial, through a model to assess the negative result from the variable factors to analyze and establish a strategic plan to cope with regular monitoring and review of the situation and related factors.

Sensitivity Analysis from Financial Factors

Financial factors that are important to the Company's business operations and impact on the Company’s performance include the volatility of raw material prices in the production process. The sensitivity analysis with the model, it was found that if the rate of increase in the price of rubber raw materials was significantly greater than the increase of the selling price, it will have a negative impact on the Company’s performance exceed the level of risk appetite, leading to the need increase amount of borrowing from external fund but it do not significantly affect the Company's debt-to-equity ratio (D/E Ratio).

In this regard, the Company has closely monitored the situation of fluctuations in raw material prices to establish a strategy to deal with in a timely manner through joint planning, adjust the quantity of raw material purchases, production, and sales to be at the appropriate point and achieve the goal of generating good performance of the company.

Sensitivity Analysis from Non-Financial Factors

Epidemic situations or various irregular incidents that may occur and affect to labor shortages, especially in the production line, the Company has managed and planned the workforce by using a sensitivity analysis with the model, it was found that low decreasing of labor rate from normal situation does not significantly affect the production process and performance but a decline in the high labor rate will have a significant impact on the operating results and exceed the level of risk appetite, leading to need to increase amount of borrowing from external fund but it do not significantly affect the Company's debt-to-equity ratio (D/E Ratio).

The Company has a manpower management, increasing the potential of labor and efficiency of the production process to replace manpower rates that may be lost from the crisis along with preparing a recovery plan to quickly restore the situation to normalcy.