COMPANY OVERVIEW
Dalmia Bharat Limited is a leading cement player in India with a significant presence in the highly attractive East, North-East, and South regions. With 15 integrated facilities and grinding units spread across 10 states, we serve across 23 states through an extensive network of dealers and sub-dealers. Acquisitions, greenfield and brownfield expansions have been instrumental in outgrowth strategy, enabling us to scale our business and expand into new markets. As part of our expansion plans, we aim to reach 49.5 MTPA by FY25 through organic expansion.
We also plan to acquire cement assets of the Jaypee Group with cement capacity of 9.4 MnT, clinker capacity of 5.7 MnT and thermal power generation capacity of 280 MW in the States of UP, MP and Chhattisgarh subject to certain conditions precedent. The Company has already commenced cement sales in Central region with two of the Jaypee plants providing cement on contract manufacturing basis.
Our wide range of value-added products and dependable postsale services contributes significantly to Indias infrastructural development. We offer a diverse range of cement variants through our brand portfolio, including Dalmia Cement, Dalmia DSP and Konark Cement. As a prominent Indian cement manufacturer, we aspire to enhance value sustainably for all stakeholders. Our commitment to environmental protection is evident through our achievements, including performance on water positivity and global leadership status in low carbon economy transition, recognised by the Carbon Disclosure Project (CDP).
GLOBAL ECONOMIC OVERVIEW
During 2023, the global economy witnessed several challenges, yet demonstrated resilience with a GDP growth of 3.1% over the past year. The growth was supported by several factors including improvements in labour market conditions, resilient trade activities, stable commodity markets, and declining inflation rates. Both advanced economies and developing economies outperformed expectations, contributing significantly to the overall economic performance.
Among advanced economies, the United States stood out with a growth rate of 2.5%. This performance can be attributed to robust labour market conditions, strong consumer spending and supportive fiscal policies. However, the Eurozone experienced subdued growth due to weak consumer sentiment, high energy prices, and sluggish business investment. In contrast, emerging and developing economies, including China and India, showcased remarkable performance. Chinas economy growth was driven by government spending on capacity building and private consumption supported by wage growth. Meanwhile, India maintained a robust growth rate, driven by resilient domestic demand, government stimulus measures and structural reforms aimed at enhancing productivity.
Key Factors Contributing to the Economic Performance
• Labour Market Improvements: Globally, unemployment rates declined, reflecting increased labour force participation and improved job opportunities.
• Trade Resilience: Trade remained a vital driver of global growth, with world trade growth projected at 3.3% for 2024 and 3.6% for 2025. However, challenges persisted due to rising trade restrictions and geoeconomic fragmentation, evidenced by approximately 3,200 new trade restrictions imposed in 2022 and a further 3,000 in 2023.
• Declining Inflation Trends: Inflation rates experienced a downward trajectory, falling faster than anticipated across most regions attributed to stable commodity prices and effective monetary policies.
• Monetary Policy Responses: Central banks responded to inflationary pressures by raising policy interest rates, aiming to stabilise prices and maintain economic balance.
Global GDP Growth (%)
Particulars |
2023 (e) | 2024 (p) | 2025 (p) |
World output |
3.1 | 3.1 | 3.2 |
Advanced economies |
1.6 | 1.5 | 1.8 |
- US |
2.5 | 2.1 | 1.7 |
- Eurozone |
0.5 | 0.9 | 1.7 |
Engineering market and developing economies |
4.1 | 4.1 | 4.2 |
China |
5.2 | 4.6 | 4.1 |
India |
6.7 | 6.5 | 6.5 |
(e) - estimate, (p) - projections
Source: IMF, World Economic Outlook Update, January 2024
Outlook
Looking ahead, the global economic outlook for 2024 remains cautiously optimistic, with signs of resilience amidst ongoing challenges. According to the IMF World Economic Outlook, the global economy will likely expand by 3.1% until 2025. Advanced economies are likely to register a slight decline in growth in 2024, followed by a recovery in 2025, with the eurozone expected to rebound from sluggish performance. Emerging markets and developing economies are forecasted to experience steady growth, although regional disparities may persist. However, risks to growth remain, including geopolitical tensions, supply disruptions and persistent inflationary pressures. Inflation will likely continue downward trend, with global headline inflation expected to decrease to 5.8% in 2024 and 4.4% in 2025. While uncertainties persist, concerted efforts to manage inflation and fiscal policies are crucial for sustaining economic stability and fostering long-term growth.
INDIAN ECONOMIC OVERVIEW
The Indian economy demonstrated resilience, recording a robust growth of 7.6% in FY24, surpassing the previous fiscal year. Strong domestic demand, favourable government policies and growth trends across critical sectors drove this increase. Notably, the construction sector experienced a growth of 9.6% in FY24 compared to previous year, contributing significantly to the overall GDP expansion. Additionally, the manufacturing sector, a vital component of the industrial index, registered a growth of 5.5% in FY24 compared to previous year. The index of industrial production exhibited a positive trend, reaching 159.2 in March 2024. The construction sector, manufacturing and other industries, played a pivotal role in driving industrial growth and contributing to the economys upward trajectory.
Regarding tax revenues, the gross goods and services tax (GST) revenues for March 2024 witnessed the second-highest collection ever at ^1.78 lakh crore, with an 11.5% YoY growth.
For FY24, the total gross GST collection exceeded ^20 lakh crore, marking an increase of 11.7% compared to the previous year.
In terms of inflation, retail inflation eased to 4.85% in March 2024, according to the consumer price index (CPI) data, reflecting stable price levels and conducive conditions for sustained economic growth. This moderation aligns with the Reserve Bank of Indias (RBI) stance of curbing inflation by maintaining status quo on key policy rates, emphasising the importance of achieving the target of 4% inflation on a longterm basis.
Budget Highlights FY25
The government has allocated ^11,11,111 crore for capital expenditure in the upcoming year, representing an increase of 11.1% over the previous year. This significant allocation, amounting to 3.4% of the GDP, underscores the commitment to infrastructure development and economic growth.
The governments emphasis on the Viksit Bharat initiative showcases its commitment to holistic and inclusive development. This vision, aimed at transforming India into a developed nation by 2047, encompasses multifaceted strategies to address various socioeconomic challenges and unlock the nations full potential.
The continuation of the scheme with a total outlay of RS.1.3 lakh crore reflects the governments emphasis on supporting state-level infrastructure projects. This longterm financing initiative aims to catalyse investment in various sectors, including transportation, energy and urban development.
The implementation of three major economic railway corridor programs, including energy, mineral and cement corridors, port connectivity corridors, and high traffic density corridors, signifies a concerted effort to enhance transportation infrastructure. These corridors are expected
i to facilitate the efficient movement of goods and materials, potentially benefiting industries reliant on rail transport, such as manufacturing and construction.
; The PM Awas Yojana (Grameen), which aims to achieve the target of three crore houses, coupled with plans for additional housing units in the next five years, underscores the governments focus on addressing housing shortages and promoting urban development. These initiatives not only provide affordable housing options but also stimulate demand for construction materials, including cement.
Enabling one crore households to obtain up to 300 units of free electricity every month through rooftop solarisation reflects the governments commitment to promoting renewable energy adoption. By incentivising solar power generation at the household level, these initiatives contribute to reducing reliance on fossil fuels and mitigating environmental impact while potentially creating demand for solar-related infrastructure and materials.
: These schemes, aimed at benefiting farmers and promoting
I food processing, have the potential to drive rural development and create employment opportunities in the agricultural value chain. Increased investment in food processing infrastructure not only enhances value addition to agricultural produce but also stimulates demand for construction materials for infrastructure development in rural areas.
Source: https://pib.gov.in/PressReleasePage.aspxRS.PRID=2001136
Outlook
Indias economic outlook remains promising, with the nation poised to maintain its position as one of the strongest economies in Asia and fastest growing largest economy globally. Supported by robust domestic demand, increased public spending, conducive business environment and favourable investment inflows, GDP growth is expected to reach 7% in FY25, as per RBI MPCs GDP forecast. Sustained efforts towards infrastructure development and economic reforms are crucial for maintaining long-term growth momentum. While geopolitical tensions persist, India aims to leverage its strategic partnerships to enhance its position among emerging economies and influence global policies.
INDUSTRY OVERVIEW
The Indian cement industry stands at the forefront of the nations economic growth, driven by various factors contributing
to its robust demand and expansion. One of the primary driving forces behind this growth is the steady progression of the Indian economy, characterised by robust fundamentals and a conducive environment for investment and development. Indias economic landscape presents a picture of resilience and stability, providing a fertile ground for various industries, including cement manufacturing, to thrive. With a growing population and increasing urbanisation, the demand for infrastructure and housing continues to soar, bolstering the demand for cement across the nation.
Robust Cement Demand Growth
The cement industry in India is experiencing robust demand growth, fuelled by several key factors that collectively contribute to its upward trajectory.
Major Demand Drivers
Rural Housing
• The Governments announcement of an additional two crore houses under the Pradhan Mantri Awas Yojana (Rural) over the next five years signifies a monumental step towards addressing housing needs in rural areas
• Allocation to Pradhan Mantri Awas Yojana (Rural) has witnessed a substantial increase of 70% from the FY24 revised estimate (RE) to ^54,500 crore for FY25, reflecting the governments commitment to bolster rural housing infrastructure
• Completion of 2.5 crore of houses over the past eight years, achieving 87% of the total target. The recent announcement of additional houses will likely stimulate growth in the Indian infrastructure and cement sectors
Infrastructure Development
• The governments substantial allocation of ^2.5 lakh crore to the Indian Railways for FY25 showcases its focus on bolstering infrastructure development
• The Ministry of Road Transport and Highways (MoRTH) has received a significant allocation of ^2.78 lakh crore for FY25, highlighting the governments commitment to enhancing road infrastructure nationwide
• With plans to invest ^143 lakh crore on infrastructure between 2024 and 2030, Indias infrastructure sector emerges as a potent driver of economic growth, presenting substantial opportunities for cement industry stakeholders
Urban Housing
• The government plans to introduce a scheme incentivising individuals residing in rented houses and unauthorised colonies to purchase or construct their own homes, thereby fostering urban housing demand
• Allocation to Pradhan Mantri Awas Yojana (Urban) has been augmented by 18% from the FY24 revised estimate (RE) to ^26,170 crore for FY25, providing a significant impetus to urban housing initiatives
• Robust residential demand in the top eight cities during the latter half of CY23, exhibiting a 12% YoY growth, underscores the buoyant demand in urban areas, further bolstering the need for cement
Private Capex
• Governments efforts to kick start an investment cycle led by robust public capex, coupled with strong corporate and bank balance sheets, is likely to provide impetus to private investments and consumption
Capex Push by the Government
The Union Budget FY25 reflects a concerted effort by the government to propel economic growth through substantial capital expenditure, with a significant focus on infrastructure development. The allocation of funds for critical sectors such as railways, roads, and housing underscores the governments commitment to driving demand for cement and fostering sustainable economic growth. Additionally, the projected increase in capital expenditure over the coming years will likely further stimulate cement demand, presenting opportunities for industry stakeholders to capitalise on emerging trends and expand their market presence.
Indicator |
FY25 Projection |
GDP growth rate |
~7-8% |
Housing demand growth* |
8-10% |
Capital expenditure*1 |
^11.11 lakh crore |
*httDs://www.indiaratines.co.in |
i/Dressrelease/69579 |
#httDs://nib.Kov.in/PressReleasePaee.asDXRS.PRID=2001136 |
|
Outlook
The Indian cement industry is poised for continued growth, buoyed by favourable economic conditions, government initiatives, and robust demand from various sectors. As the nation embarks on economic resurgence and infrastructure development, the cement industry stands as a stalwart contributor, driving progress and prosperity across the country. With strategic investments, innovative solutions, and a commitment to sustainable development, industry players can capitalise on emerging opportunities and chart a path toward long-term success in this dynamic and evolving landscape.
BUSINESS REVIEW
As a leading player in the cement industry, we operate in a dynamic market environment shaped by evolving industry trends and macroeconomic factors. As India progresses towards becoming the worlds third-largest economy by FY28, we are poised to capitalise on emerging opportunities and contribute to the nations growth story. With a robust business model, a focus on sustainability and a commitment to excellence, we are well-positioned to navigate the challenges and seize the opportunities presented by the evolving market landscape.
Our integrated model encompasses state-of-the-art production facilities strategically located across vital regions, ensuring operational efficiency and cost competitiveness. With an average life of mine exceeding 20 years across most plants, our captive mines provide a reliable and sustainable source of raw materials. In FY24, our ability to add capacity at the lowest cost further strengthened our market position, with an annual capacity of 44.6 million metric tonnes.
Our diverse product portfolio, including Portland Slag Cement (PSC), Portland Pozzolana Cement (PPC), Portland Composite Cement (PCC), and Ordinary Portland Cement (OPC), caters to varied customer needs and applications. In FY24, our product
mix comprised 13% OPC, 14% PSC, 19% PPC and 54% PCC. Notably, we are the largest producer of PSC in India with 87% blending ratio in FY24.
Our disciplined capital allocation framework prioritises shareholder returns, innovation, and sustainable growth. Up to 10% of operating cash flow is allocated towards shareholders return, comprising a mix of dividends and share buybacks. Additionally, investments in innovation and green energy initiatives support our long-term objectives, focusing on reducing carbon footprint and enhancing operational efficiency.
Performance Review
• Financial Performance: In FY24, Dalmia Bharat Limited achieved robust financial performance, with revenue growth of 8% compared to FY23. Despite market volatility, our EBITDA margin improved from 17% in FY23 to 18% in FY24, reflecting effective cost management. EBITDA per metric tonne increased from RS.904 in FY23 to RS.917 in FY24, driven by operational efficiency.
• Operational Performance: Operationally, we delivered impressive volume growth of 12% in FY24, reaching a total of 28.8 million metric tonnes. By optimising production efficiency and leveraging our integrated model, we enhanced market responsiveness and customer satisfaction. Notably, our average fuel purchase price dropped from $179/T in FY23 to $118/T during FY24, contributing to margin improvement.
Strategic Priorities
Refer to page 34 for the identified objectives under each strategic priority, focus areas, progress and way forward.
COMMITTED TO SUSTAINABILITY
At Dalmia Bharat Limited, sustainability is at the heart of everything we do. We understand the pressing need to address climate change and are dedicated to building a more sustainable future. We have rolled out a wide range of sustainability initiatives that touch every aspect of our operations, advocacy work, policy engagements and climate strategies.
Advocacy and Collaboration
Driving real change requires active advocacy and collaboration. Thus, we have put in place a robust management system to ensure our advocacy efforts and memberships in trade associations align with our sustainability goals. By pushing for renewable energy policies and stronger emission standards, we are pushing for a shift towards a low-carbon economy, in line with global climate goals.
To maintain consistency with our sustainability objectives, we have established a strong governance framework for our public policy work. This ensures that our policy actions are in sync with our commitment to the Paris Agreement, allowing us to make informed decisions that support our stance on climate change.
Sustainability Goals, Initiatives and Progress
Diversifying Energy Sources
Our strategic focus on green energy sources sets us apart in the industry. With a commitment to renewable energy and waste heat recovery, we are laying the groundwork for a sustainable future. By aiming further increase in our renewable energy mix, we are taking bold steps to reduce carbon emissions and promote clean energy.
Decarbonising the Cement Industry
We are leading the change in industrial decarbonisation. We are founding member of leadership group for heavy industry transition (LEADIT) chaired by Govt, of India and Govt, of Sweden. Being one of the earliest to announce ambitious decarbonisation targets, we continue to remain below the most aspiring transition pathways and one of the lowest carbon footprint cement producers globally on account of renewable capacity augmentation, fossil fuel reduction and energy efficient operations.
Innovation & Green Energy Fund
Within our capital allocation framework, we allocate up to 10% of our operating cash flow to an Innovation & Green Energy Fund. This fund drives focused research and development in climate change and technological advancements, ensuring we stay at the forefront of sustainable practices.
Transforming Waste into Resources
We are committed to transforming waste into valuable resources, making us a global leader in sustainable practices within the cement industry. By utilising alternative raw materials and fuels such as fly ash, slag, red mud, synthetic gypsum, lime sludge, and blue metal, we are minimising environmental impact, conserving natural resources, and promoting sustainable manufacturing.
Harnessing Innovation & Technology
Innovation is at the heart of our sustainability journey.
By leveraging cutting-edge technology solutions in our operations, such as Transportation Management Systems, SAP Ariba, and Robotic Process Automation, we are optimising processes, driving efficiency, and reducing our environmental footprint.
Commitment to a Greener Future
As we continue to push boundaries and redefine industry norms, our commitment to sustainability remains unwavering. From diversifying energy sources to harnessing innovation and technology, every step we take is towards building a cleaner, greener future for generations to come.
Recognition
At the 3rd National Cement Conclave on "Net Zero Vision" organised by the Quality Circle Forum of India (QCFI) in January 2024, the Dalmiapuram unit was recognised for its excellence in AFR, energy, environmental, renewable power, health and safety, climate change, and biodiversity, while units in Meghalaya and Ariyalur also received multiple excellence awards in categories including energy, environment, and water excellence, further emphasising our commitment to sustainability.
At The Sustainable World Conclave 2023 organised by Business World in June 2023, Dalmia Bharat was honored as one of the Top 3 Most Sustainable Companies in the Infrastructure and Engineering Sector and achieved the 23rd rank among the Top 50 Most Sustainable Companies overall, highlighting our significant commitment to sustainability.
Dalmia Bharat Limited
SCOT ANALYSIS
A comprehensive SCOT (strengths, challenges, opportunities, threats) analysis lets us assess our competitive position and navigate market uncertainties effectively. By leveraging strengths such as our integrated model, diverse product portfolio, and disciplined capital allocation, we can capitalise on emerging opportunities while mitigating potential threats to our business.
• A diverse and value-added portfolio of premium products, resulting in enhanced customer satisfaction and loyalty
• Ability to increase production capacity at a lower capital outlay due to economies of scale
• A robust and integrated technology system that strengthens the entire supply chain management, resulting in economical purchases
• Market leadership in Eastern India, primarily due to our mammoth network of channel partners
• Proven track record of financial performance, with a lower cost of production and higher sales and profits
• Pioneer in the area of sustainability
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• There are possible business opportunities with government initiatives such as Gati Shakti, the National Infrastructure Plan, the Pradhan Mantri Awas Yojana, and Smart Cities
• Leverages the countrys increasing demand for housing and infrastructure, especially due to urbanisation and an increased population
• Increased business possibilities due to the governments increasing focus on the improvement of rural and primary sector infrastructure
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• Unforeseen events like the COVID-19- induced pandemic can hamper the operations of our Company
• Potential geopolitical tensions across the world can adversely affect the costs, overall demand, and functioning of our Company
• Rising competition can hinder growth and reduce profit potential
• Increased input costs, such as the cost of freight, power, and fuel may increase the overall cost of production and result in lower gross margins and profitability
• Improvement in Cement prices lower than the rate of inflation
RISK MANAGEMENT
Effective risk management is critical to safeguarding our capital and earnings against potential risks. Our Company has implemented robust risk management practices integrated with our strategic and operational decision-making processes.
At the Group-level, we have operationalised a risk function to incorporate risk and compliance management for sustainable business performance. Our Risk Management Committee, comprising independent directors, is the highest governing body for addressing risk challenges and reviewing mitigation plans. Additionally, we have a resource allocation policy that considers enterprising risk. The following are some of the key risks faced by our Company:
• Input Cost Risk: Our Company is exposed to the risk of inflation and market-driven fluctuations in the cost of coal, pet coke, power, and other fuels. Given the energy-intensive nature of the cement industry, fluctuations in fuel prices significantly impact production costs. We have established well-designed plans to address input cost risks effectively.
• Compliance Risk (Legal Risk): With the constantly evolving regulatory framework, there is a risk of non-compliance with legal requirements, which can lead to fines and charges. We have established committees to create employee awareness and mitigate compliance risks effectively.
• Climate Change Risk: We are committed to adopting sustainable practices as a socially and environmentally responsible company. Our philosophy of Clean and Green is Profitable and Sustainable guides our operations, making us a powerful and distinctive brand. We have subscribed
to stringent voluntary emissions reduction programmes to address climate change risks proactively.
• Financial Risk: Our Company is exposed to risks associated with interest rates, foreign exchange rates, and commodity price fluctuations. We have adopted an appropriate financial risk management policy to minimise these risks and regularly monitor and report on them.
• Information Technology Risk: Risks arising from IT systems, data integrity, and physical assets are addressed through backup procedures, storing information at different locations, and ensuring regular updates of systems with the latest security standards. Given the computerised nature of our business data, we take measures to prevent data manipulation or loss.
• Logistics Risk: Managing infrastructure to meet growing needs, increasing logistics costs, evolving regulatory mandates for zero carbon targets, limited government support for rail freight requirements, and restrictions on heavy vehicle movement pose logistics risks. We mitigate these risks through rate contracts with transporters, implementation of supply chain optimisers, and conversion of vehicles to alternative fuels.
• Sales and Marketing Risk: Fragmented markets, rapid capacity additions by competitors, limited distribution networks, and changing industry preferences pose sales
and marketing risks. We address these risks through benchmarking analysis, proactive market positioning, and developing innovative products for niche markets.
• Human Resource Risk (Talent Management Risk): Our critical challenges include retaining talent and ensuring the right people are in the right roles. We mitigate talent management risks by providing specialised training courses to enhance and reskill employees, thus creating a talent pipeline for future roles.
OUR TECHNOLOGICAL EXCELLENCE
At Dalmia Bharat Limited, we leverage technology to empower our stakeholders and drive sustainable growth. Our strategic investments in technology aim to enhance operational efficiency, improve customer satisfaction, and create long-term value for all stakeholders involved in our ecosystem.
Enhancing Efficiency for Suppliers and Customers
Through our partnership to implement a transportation management system (TMS) solution, we are revolutionising how we manage transportation operations. This comprehensive platform optimises route planning and load optimisation and ensures the timely delivery of products to our customers.
By streamlining transportation processes, we enhance efficiency for our suppliers and ensure on-time deliveries, thereby improving customer satisfaction. Our commitment to automation, mobility, and cloud solutions extends to our entire supply chain ecosystem. We enable seamless collaboration and communication among suppliers, distributors, and internal teams by leveraging these technologies. This approach facilitates real-time information sharing, enhances visibility into supply chain operations, and enables proactive decision-making. Ultimately, these solutions empower all stakeholders to work together towards common goals, driving efficiency and agility across the supply chain.
• Empowering Sales Teams to Drive Growth: As a pioneering initiative in the cement industry, we provide gamification tools to our area sales officers (ASOs). These tools empower our sales teams to maximise scheme incentives and drive sales growth. By gamifying sales activities, we foster greater engagement and motivation among our salesforce, increasing productivity and stronger customer relationships.
• Strengthening Supplier Relationships and Accountability:
Through our partnership with SAP Ariba, we strengthen our relationships with suppliers and ensure compliance with regulatory requirements. This platform provides our suppliers a user-friendly interface for managing orders, invoices, and payments, streamlining the procurement process, and reducing administrative burdens. Promoting transparency and accountability fosters trust and collaboration with our suppliers, driving mutual growth and success.
• Improving Operational Efficiency and Compliance: With robotic process automation (RPA), we automate critical processes within our organisation, improving operational
efficiency and compliance. Automating repetitive tasks frees up valuable time for our employees to focus on higher- value activities. Additionally, RPA enhances accuracy and consistency in our operations, reducing the risk of errors and non-compliance. Ultimately, RPA enables us to deliver superior value to our customers and stakeholders while driving cost savings and productivity gains.
• Driving Informed Decision-making and Continuous Improvement: Through advanced analytics, we harness the power of data to drive informed decision-making and continuous improvement. By analysing data from multiple sources, we gain valuable insights into market trends, customer preferences, and operational performance. These insights enable us to identify opportunities for optimisation, mitigate risks, and drive innovation across our business.
Our advanced analytics empower us to make data-driven decisions that deliver tangible value to our customers, employees, and shareholders.
• Building a Foundation for Digital Transformation: Our
robust technology stack forms the foundation for our digital transformation journey. By centralising and analysing vast amounts of data, we unlock new opportunities for innovation and growth. This technology stack enables us to adapt to evolving market dynamics, anticipate customer needs, and respond rapidly to changing business conditions. This strategy allows us to stay ahead of the curve and drive sustainable value creation for all our stakeholders.
Our People, Our Strength
At Dalmia Bharat Limited, we treat all individuals with dignity and respect. Our people are our greatest asset, and we strive to provide them with the best working environment with modern technologies. Our human resources, legal, and secretarial departments work in tandem with other functions to protect all employees against sexual harassment in the workplace. We have robust policies and procedures in place to prevent and redress any complaints in this regard. We aim to cultivate a sense of belongingness and ensure we hear every voice within our organisation. To this end, we provide various
learning opportunities to enhance the skills and knowledge of our workforce. Through continuous learning and development initiatives, we empower our employees to reach their full potential and contribute effectively to our shared success.
Prioritising Health and Safety
The health and safety of our employees are paramount, and we continuously strive to improve our practices to ensure zero harm across our manufacturing units. We have developed a multi-year roadmap of guidelines to activate safety measures and achieve our safety goals. By implementing rigorous safety protocols and fostering a culture of accountability, we are committed to creating a safe and secure working environment for all. A fit and healthy workforce is essential for a prosperous future. We have launched the FIT Dalmia Wellness Programme to promote physical and mental well-being. Through this initiative, we offer a comprehensive wellness module called WIN, which focuses on nurturing the body, mind, and soul of our employees and their families. By prioritising holistic wellness, we strive to ensure our workforces overall well-being and happiness.
Outlook
Looking ahead, we are optimistic about the future. Despite prevailing challenges, we intend to capitalise on emerging opportunities, drive sustainable growth, and create long-term value for all stakeholders. With a clear strategic vision, resilient business model and commitment to excellence, we are poised for continued success in the years to come.
Internal Control Systems and their Adequacy
DBL has a well-placed internal control system commensurate with our operations size, scale, and complexity. We have a well- defined organisational structure and management procedures to ensure all internal financial controls are adequate and operating effectively. We have built-in policies and procedures to safeguard our assets, maintain proper accounting records, and provide financial information. The internal control and risk management systems are systematically structured and applied per the corporate governance code of our organisation.
Strong Board oversight, timely disclosures, transparent accounting policies, and high levels of integrity in decisionmaking drive the corporate governance practices at DBL. Our internal audit function is entrusted to Ernst & Young (EY). EY performs thorough audits of our Group operations in accordance
with Board-approved plans and presents their findings to the Audit Committee. Our management has evaluated the effectiveness of these controls and noted no significant deficiencies or material weaknesses that might impact the financial statements as of March 31, 2024.
FINANCIAL OVERVIEW
Consolidated Results
RS. in crore
Description |
FY 2023-24 | FY 2022-23 | Change (%) |
Revenue from operations |
14,691 | 13,552 | 8% |
Expenses |
|||
Cost of raw materials consumed |
2,120 | 1,906 | 11% |
Purchases of stock in trade |
567 | 52 | 990% |
Changes in inventories of finished goods, stock in trade and work-in-progress |
16 | 23 | (31%) |
Power and fuel |
3,116 | 3,679 | (15%) |
Total cost of goods sold |
5,819 | 5,660 | 3% |
Employee benefits expense |
871 | 771 | 13% |
Freight charges |
|||
- on finished goods |
2,759 | 2,498 | 10% |
- on internal clinker transfer |
444 | 304 | 46% |
Other expenses |
2,159 | 1,991 | 8% |
Total expenses |
12,052 | 11,224 | 7% |
Operating EBITDA |
2,639 | 2,328 | 13% |
Operating EBITDA Margin (%) |
18% | 17% | |
Other income |
315 | 126 | 150% |
Finance costs |
386 | 234 | 65% |
Depreciation and amortisation expense |
1,498 | 1,305 | 15% |
Profit before share of profit in associate and joint venture and exceptional items |
1070 | 915 | 17% |
Share of profit in associate and joint venture accounted for using equity method (net) |
0 | 554 | (100%) |
Exceptional items (net) |
- | (144) | (100%) |
Profit before tax from continuing operations |
1,070 | 1,325 | (19%) |
Total tax expense |
216 | 242 | (11%) |
Profit after tax from continuing operations |
854 | 1083 | (21%) |
Profit/(loss) from discontinued operations |
(1) | (4) | (73%) |
Profit After Tax (PAT) |
853 | 1079 | (21%) |
PAT % |
6% | 8% |
During FY24, the Group recorded an EBITDA of 72,639 crore (previous year 72,328 crore) registering improvement of 13% over FY23, This is primarily on account of reduction in fuel prices and increase in sales volume which are partially set off due to lower net sales realisation and increase in fixed costs and logistics costs.
In spite of marginal increase in EBIDTA, profit for the year was reduced from 71,079 crore in FY23 to *853 crore in FY24, This is mainly due to share of profit in associate in FY23, which is not in the current year as the Group had sold associate business in
0. 1 FY24,
The basic and diluted earnings from continuing operations for the FY 2023-24 were at 744,11 per share and 744.10 per share, respectively (previous year: basic and diluted: 755.44 per share and 755.41 per share, respectively),
1. Revenue from operations
The Groups total revenue has grown by 8% to 714,691 crore in FY24 from 713,552 crore in FY23.
RS. in crore
Particulars |
FY24 | Change (%) |
|
Cement and its related products |
14,313 | 13,212 | 8% |
Power |
9 | 11 | (14%) |
Management service charges |
12 | 14 | (12%) |
Total sale of products and services |
14,334 | 13,237 | 8% |
Other operative revenue |
357 | 315 | 14% |
Total revenue from operations |
14,691 | 13,552 | 8% |
The sales volume of the Group were 28.8 MnT in FY24 registering a growth of 11.8% as compared to 25.7 MnT in FY23. The average selling price (net of discount and taxes) decreased by 2.9% in FY24 over FY23.
The Group continued to retain a strong presence in the Southern, Eastern and North-Eastern markets while increasing sales volume in the region of West and Central India.
Other operating revenue mainly includes subsidies on sale of finished goods and scrap sale.
2. Other income
Other income primarily comprises of interest income, dividend income, gain on sale and fair valuation of financial instruments and others.
Other income increased by 7189 crore to 7315 crore mainly attributed due to increase in (a) treasury interest income on investments in bonds, (b) Increase in return on Investments in mutual funds from 4.9% to 7.2%, (c) increase in return on FD from 6.4% to 7.4% (d) Interest
subsidy scheme by Govt, accrued in collected in FY24 and (e) increase in interest on NCD.
3. Cost of goods sold
Cost of good sold accounted for 39.6% of revenue in FY24 as against 41.8% in FY23.
The cost of goods sold increased by 3% in FY24 when clinker and cement production increased by 8% and 7.2%, respectively. The expense has been increased due to increase in business volume and increase in prices of raw material which is partially set off by decrease in fuel prices.
Power and fuel costs of the Group have decreased by 15% from 71,429/T in FY23 to RS.1,083/T in FY24.
4. Employee benefits expenses
The employee cost increased by 13% in FY24 mainly due to a) increment in the annual salaries which was in line with the industry, b) increase in average headcount. This is partially offset by ESOP options vested during the year resulting into lower ESOP expenses.
Employee benefits expense accounted for 5.9% of revenue in FY24 as against 5.7% in FY23.
5. Freight charges on finished goods
Cost increased on account of increased sales volume by 11.6% as compared to previous year. Further, freight on cement increased from 71,088/T to 71,113/T of cement sold in 2024 (up by 2.4%) due to increased movement of clinker.
Freight charges on finished goods accounted for 18.8% of revenue in FY24 as against 18.4% in FY23.
6. Finance costs
Finance cost increased by 7152 crore to 7386 crore mainly due to increase in gross debt during the year, and further higher weighted average cost of total borrowings from 6.9% p.a. in FY23 to 8.3% p.a. in FY24 on account of increase in bank interest rates.
7. Depreciation and amortisation expense
Depreciation and amortisation expense increased by 7193 crore to 71,498 crore in FY24, mainly a) due to additions in PPE during FY24, b) accumulated depreciation on equipment replaced in debottlenecking projects of 7108 crore, which is partially set off due to change in the policy of method of depreciation on PPE situated at North east units from written down value to straight line method and salvage value of the building and plant & equipment from 1% to 5% by 746 crore and 714 crore respectively.
8. Exceptional items
Exceptional loss for the year ended March 31, 2024 and March 31, 2023 is Nil and RS.144 crore respectively.
Due to reclassification of investment in associate carried at RS.944 crore to Assets classified as held for sale, consequent to binding agreement entered into by DCBL during the previous year for sale of its entire investment at a consideration of RS.800 crore to a promoter group company, and the difference between the consideration and carrying value amounting to RS.144 crore was recognised as exceptional loss during the previous year.
9. Tax expense
Tax expense for FY24 as a percentage to profit before share of profit in associate and joint venture and exceptional items is lower than previous year, mainly on account of reversal of tax provision related to earlier years.
During the current quarter, DCBL has reassessed its tax provisions made in earlier years based on interpretation of the prevailing income tax laws and rules and has written back the same to the tune of RS.60.7 crore under the head Tax related to earlier years.
Consolidated Balance Sheet
1. Property, plant and equipment (PPE) including Intangibles and Right-of-use assets
(i) Total additions to PPE and Intangible assets were RS.2,328 crore (net block increase by ^1,067 crore), mainly on account of:
(a) Capacity expansion of cement and clinker by 6 MnTPA and 0.9 MnTPA respectively of RS.1,445 crore
(b) Solar power, recycle waste, WHRS projects at various locations (RS.200 crore)
(c) Acquisition of land, mines and mining rights for setting up of projects/expansions at various locations (RS.142 crore)
(d) Other regular additions in PPE mainly consisting of routine maintenance and efficiency/ productivity improvement capital expenditure.
(ii) Capital work in progress (CWIP) stood at RS.2,284 crore as at March 31, 2024 and is largely attributed to (a) capacity enhancement/upgradation of cement mills (b) installation of pyro upgradation at various plants across the Group.
(iii) Goodwill: There was no addition in the value of goodwill during the year. The Group continued to amortise goodwill acquired pursuant to Scheme of Arrangement and Amalgamation sanctioned by
Honble National Company Law Tribunal and amount of amortisation during the year was RS.203 crore.
(iv) Right-of-use assets: Additions during the year was RS.172 crore on account of lease contracts of land, buildings, railway wagons (godowns, office and residential premises) and vehicles used in its operations.
(v) Intangible assets under development stood at RS.111 crore as at March 31, 2024 and largely attributed to (a) mining rights and (b) IM Systems.
(vi) The Group has provided adequate depreciation and amortisation in accordance with the useful lives
of the assets determined in compliance with the requirements of the Companies Act, 2013. In certain class of assets, the Group uses different useful life than those prescribed in Schedule II of Companies Act, 2013.
2. Non-current investments
(i) Investments accounted using equity method of
RS.2 crore as at March 31, 2024 consists of investment in a joint venture.
(ii) Other non-current investments of RS.588 crore as at March 31, 2024 mainly consists of investment in equity shares of a listed entity, optionally redeemable convertible debentures and compulsorily convertible preference shares.
3. Current investments
Current investments of RS.3,872 crore as at March 31, 2024 mainly consists of investment in Equity shares of a listed entity, mutual funds, corporate bonds, and redeemable NCDs. Increase in investments were predominantly on account of (a) increase of investment in various debt based mutual funds (b) increase in investment in corporate bonds and commercial papers (c) Investment in redeemable non- convertible debentures and (d) MTM gain on investment held in IEX of RS.85 crore.
4. Inventories
Inventory as at March 31, 2024 was RS.1,218 crore compared to RS.1,316 crore as at March 31, 2023. Decrease was primarily due to decrease of fuel inventory by RS.170 crore on account of decrease in pet coke and coal prices which is primary set off due to increase in Raw materials, WIP, FG, stock in trade and stores, spares by 81 crore. Our inventory days was 32 days in FY24 against 31 days in FY23.
5. Trade receivables
Trade receivables as at March 31, 2024 stood at RS.836 crore against RS.700 crore as at March 31, 2023, reflecting an
increase of RS.136 crore. Our current receivable days (before provision for rebate to customers) has remained broadly stable at 20 days.
6. Other financial assets
Total other financial assets (non-current and current) of RS.957 crore as at March 31, 2024 primarily consists of subsidies/incentive receivable of RS.701 crore, security deposits of RS.143 crore and other receivables.
Increase in other financial assets by RS.81 crore mainly on increase in security deposit by RS.26 crore and Interest receivable by RS.32 crore.
7. Other non-current and current assets
Other assets (non-current and current) of RS.1,379 crore as at March 31, 2024 mainly consists of capital advances, deposits and balances with government departments and other authorities and advance to suppliers. Increase in other assets were predominantly on account of increase in capital advances by RS.80 crore, deposit and balances with government departments by RS.104 crore and supplier advances by RS.72 crore during the year.
8. Assets or disposal group classified as held for sale
Consequent to the approval granted by the Board of Directors of DCBL on March 25, 2023, DCBL had, during the quarter ended June 30, 2023, completed the sale of its entire investment in the equity shares of Dalmia Bharat Refractories Limited, an associate company, to Sarvapriya Healthcare Solutions Private Limited, a promoter group company for a consideration of RS.800 crore. The aforesaid investment was reclassified to Assets held for sale pursuant to the binding agreement executed during the year ended March 31, 2023 and the difference between the carrying amount of investment and the consideration at the time of reclassification, resulted in recognition of loss ofRS.144 crore under the head exceptional item for the year ended March 31, 2023.
9. Share capital
The paid-up share capital of the Company as at March 31, 2024 was RS.38 crore comprising 18,75,47,629 equity shares of face value RS.2 each. During the year, Company has further issued 67,268 shares to eligible employees under ESOP during the year.
10. Gross debt and Net debt
Gross debt was higher by RS.888 crore and stood at RS.4,651 crore as at March 31, 2024, due to availment of long-term Rupee Term loans during the year to fund the capital expenditure for ongoing capacity expansion projects.
Net debt was lower by RS.177 crore and stood at RS.484 crore as at March 31, 2024. Decrease was mainly attributable to strong operating cash-flows and realisation of part sales proceeds for divestment of our non-core businesses (Refractory/Hippostores).
11. Trade payables
Total balance as at March 31, 2024 at RS.1,316 crore, increased by RS.181 crore due to increase in business volume in Q4 FY24.
12. Other financial liabilities
Other financial liabilities (current and non-current) increased by RS.101 crore to RS.1,635 crore as on March 31, 2024, mainly on account of increase in a) liability for capital expenditures by RS.54 crore, b) increase in security deposit received due to increase in business volume by RS.35 crore and c) rebate to customer by RS.10 crore.
13. Provisions
Total balance (non-current and current) as at March 31, 2024 was RS.345 crore as compared to balance of RS.320 crore as at March 31, 2023. The increase was primarily due to increase in mines reclamation liability by RS.11 crore on account of revising the estimates and further capitalisation in PPE, and further increase due to employees defined benefits which is based on the valuation from the independent actuary, which is partially set off due to decrease in enterprise social commitment.
14. Other liabilities
Other liabilities primarily consist of liability towards dealer incentives, advance from customers and statutory dues.
Total other liabilities (non-current and current) increased by RS.63 crore mainly on account of increase in liability towards dealer incentives due in increase in business volume and advance received from customers which is partially set off due to reduction in statutory dues.
Consolidated Cash Flows
RS. in crore
Particulars |
FY 2023-24 | FY 2022-23 | Change |
Net cash flow from operating activities |
2,635 | 2,252 | 383 |
Net cash flow (used) in investing activities |
(2,750) | (2,326) | (424) |
Net cash flow from/ (used in) financing activities |
222 | 168 | 54 |
Net increase/ (decrease) in cash and cash equivalents |
107 | 94 | 13 |
Net cash flow from operating activities:
During the year under review, the net cash generated from operating activities was RS.2,635 crore as compared to RS.2,252 crore during the previous year. The cash inflow from operating profit before working capital changes during the current year was RS.2,643 crore as compared to inflow of RS.2,343 crore during the previous year due to marginal increase in operating profits.
Cash inflow from working capital changes in FY24 is mainly due to decrease in inventories by RS.98 crore and increase in trade and other payables/provisions by RS.305 crore, partly offset by increase in trade receivables and other financial assets by RS.357 crore.
The income tax paid during the current year was RS.54 crore (net of refund) as compared to RS.14 crore during previous year. This increase in income tax paid predominantly is on account of tax on sale of investment in equity shares of Dalmia Bharat Refractories Limited.
Net cash flow (used in) investing activities:
During the year under review, the net cash outflow from investing activities amounted to RS.2,750 crore as compared to RS.2,326 crore during the previous year. The outflow during the current year broadly represents capital expenditure of RS.2,723 crore (net off sale proceeds), investment in fixed deposits and
current investments (net of proceed from sale) of RS.761 crore, partly offset by part sales proceeds from sale of non-core businesses (Refractory/Hippostores) amounting to T600 crore and receipt of interest and dividend income amounting to RS.134 crore.
Net cash flow from/(used in) financing activities: Inflow of <222 crore during the previous year. The inflow during the current year broadly represents availment of borrowings of RS.889 (net of payments), which is partly offset by payment of interest of RS.452 crore, principal portion of lease liabilities of RS.49 and dividends of RS.169 crore.
Key Financial Ratios are as under:
Particulars |
FY 2023-24 | FY 2022-23 | {%}Change |
Debtors Turnover (in times) * |
44.11 | 48.39 | (9%) |
Inventory Turnover (in times) |
11.31 | 11.70 | (3%) |
Interest Coverage Ratio (times) |
6.31 | 8.16 | (23%) |
Current Ratio (times) |
1.75 | 1.45 | 21% |
Debt Equity Ratio (times) |
0.28 | 0.24 | 18% |
Operating Profit Margin (%) |
7.8% | 7.5% | 3% |
Net Profit Margin (%) |
5.8% | 8.0% | (27%) |
Return on Net Worth (%) |
5.3% | 6.8% | (22%) |
* debtors turnover is computed net of provision for rebate to customers and on average of opening and closing debtors.
Explanations for variation of 25% or more in Key Financial Ratios:
1. Net Profit Margin: The net profit margin decreased due to lower profits on account of sale of business resulting to non-recognition of share of profit from JV/Associates, which is partly offset by increased in sales volume and decline in costs, saving in exceptional items as compared to last year.
Boards Report
Dear Members,
Your directors have pleasure in presenting their 11th Report along with the audited financial statements including the consolidated financial statements for the financial year ("FY") 2023-24.
The state of affairs of the Company comprising the performance of its business relating to providing management services and cement business of its subsidiaries are detailed out in the Management Discussion and Analysis Report, which forms part of the Annual Report.
FINANCIAL HIGHLIGHTS
| Standalone | (RS. in crore) Consolidated | |||
| 2023-24 | 2022-23 | 2023-24 | 2022-23 | |
Revenue from operations |
130 | 132 | 14,691 | 13,552 |
Profit before finance costs, depreciation and tax |
132 | 214 | 2,954 | 2,454 |
Less: Finance costs |
4 | 3 | 386 | 234 |
Profit before depreciation and tax |
128 | 211 | 2,568 | 2,220 |
Less: Depreciation and amortisation |
5 | 6 | 1,498 | 1,305 |
Profit before share of profit/(loss) in associate and joint venture and exceptional items |
123 | 205 | 1,070 | 915 |
Add: Share of profit in associate and joint ventures |
- | - | 0 | 554 |
Less: Exceptional items (net) |
- | - | - | 144 |
Profit before tax from continuing operations |
123 | 205 | 1,070 | 1,325 |
Tax expense: |
||||
Current tax |
12 | 11 | 141 | 32 |
Deferred tax charge/(credit) |
(1) | (1) | 131 | 239 |
Tax adjustments for earlier years |
0 | (0) | (56) | (29) |
Total tax expense of continuing operations |
11 | 10 | 216 | 242 |
Profit after tax for the year from continuing operations |
112 | 195 | 854 | 1,083 |
Net profit/(loss) for the year from discontinued operations |
- | - | (1) | (4) |
Profit for the year |
112 | 195 | 853 | 1,079 |
Profit attributable to non controlling interest |
- | - | 27 | 44 |
Profit attributable to owners of the Parent |
112 | 195 | 826 | 1,035 |
Other comprehensive income/(loss) |
5 | (185) | 72 | (1,313) |
Total comprehensive income |
117 | 10 | 925 | (234) |
Basic EPS - Continuing operations |
5.99 | 10.41 | 44.11 | 55.44 |
Basic EPS - Discontinued operations |
- | - | (0.06) | (0.22) |
Basic EPS |
5.99 | 10.41 | 44.05 | 55.22 |
Retained earnings: Balance of profit for earlier years |
371 | 344 | 5,693 | 4,825 |
Add: Profit for the year (attributable to owners of the Parent) |
112 | 195 | 826 | 1,035 |
Add: Other comprehensive income/(loss) recognised in retained earnings |
2 | 1 | - | 2 |
Add: Capital contribution transferred from non-controlling interest |
- | - | 33 | - |
Add: Adjustment due to change in shareholding in subsidiary |
- | - | 3 | - |
Less: Dividends paid on equity shares |
169 | 169 | 169 | 169 |
Retained earnings: Balance to be carried forward |
316 | 371 | 6,386 | 5,693 |
OVERVIEW OF OPERATIONAL AND FINANCIAL PERFORMANCE
On a standalone basis, your company recorded net revenue of RS.130 crore for the FY 2023-24 registering a marginal decline of 1.5% as compared to the net revenue of RS.132 crore in the FY 2022- 23; Earnings before Finance Cost, Depreciation and Taxes stood at RS.132 crore in FY 2023-24 as compared to RS.214 crore in FY 2022-23 and earned profit before tax of RS.123 crore during the FY 2023-24 as compared to RS.205 crore profit earned in the FY 2022-23.
The consolidated performance of the Company, its subsidiaries, associates and joint venture companies (collectively referred to as "the Group") has been detailed at appropriate places in this report.
Your company maintained growth momentum in the financial year 2023-24. On a consolidated basis, the net revenue reached RS.14,691 crore, marking a notable growth of 8.4% compared to the previous financial years net revenue ofRS.13,552 crore. There was an increase of 20.4% in the earnings before finance cost, depreciation, and taxes, which stood atRS.2,954 crore in FY 2023- 24, compared to RS.2,454 crore in FY 2022-23.
The profit before tax (continuing operations) in FY 2023-24 amounted to RS.1,070 crore, indicating a decline of 19.2% when compared to the RS.1,325 crore earned in the financial year 2022-23. Moreover, the profit after tax for FY 2023-24 reached RS.853 crore, showing a decline rate of 20.9% compared to the RS.1,079 crore earned in FY 2022-23
UPDATES ABOUT THE SUBSIDIARIES
(i) Dalmia Cement (Bharat) Limited
As at the close of the year, Dalmia Cement (Bharat) Limited (DCBL), wholly owned subsidiary of the Company, has enhanced its Cement capacity to 44.6 MnT; Clinker Capacity to 22.6 MnT; Solar Power capacity to 113 MW and West Heat Recovery System Power to 72 MW. During the year under review, DCBL has commenced commercial production of its cement griding capacity of 0.9 MTPA at BGM unit, 0.6 MTPA at BCW unit and 2.5 MTPA at JCW unit. Further, the clinkerisation capacity of 0.5 MTPA was increased at Ariyalur unit,
0.2 MTPA was increased at Dalmiapuram unit and 0.2 MTPA at Belgaum unit.
In a bid to exit from the non-core business areas, on April 25, 2023, DCBL has sold its entire investment of 1,87,23,743 equity Shares of RS.10 each (42.36% of share capital) of Dalmia Bharat Refractories Limited (DBRL), an associate company, at a consideration of RS.800 crore to M/s Sarvapriya Healthcare Solutions Private Limited (Sarvapriya), a promoter group Company. Sarvapriya had paid RS.160 crore (20%) immediately on signing the contract and one tranche of NCD of RS.320 crore (40%) plus due interest of redemption was received during the year. The 2nd tranche of RS.320 crore (40%) are due for redemption in September 2024.
DCBL, has entered into Share Purchase Agreement (SPA), Deed of Accession (DOA) and Power Purchase Agreement (PPA) on April 5, 2024, to acquire 18.13% of equity share capital of 02 Renewable Energy V Private Limited, consisting of 68,99,293 equity shares aggregating to RS.7,80,99,997/- (RupeesSeven crore Eighty Lakh Ninety-Nine Thousand Nine Hundred and Ninety-Seven only), in one or more tranches to source wind power as a captive consumer for a capacity upto 11 MW located in the State of Karnataka.
(ii) Dalmia Cement (North-East) Limited (‘Formerly known as Calcom Cement India Limited):
Dalmia Cement (North-East) Limited (formerly, Calcom Cement India Limited) (DCNEL) has approved capital expenditure to the tune of RS.3,858 crore for setting up of (a) new clinkerisation unit of 3.6 MTPA at its Umrangso unit (b) new cement grinding unit of 2.4 MTPA at its Lanka unit, and (c) capacity expansion at existing clinkerisation unit at Lanka. DCNEL is a stepdown subsidiary of the Company and subsidiary of DCBL.
DCBL has made further investment by subscribing to 153 crore equity shares of RS.10 each offered by DCNEL on a rights basis at an investment value of RS.1,530 crore. With the said allotment, the shareholding of DCBL in DCNEL has increased from 66.70% to 92.83%, and the shareholding of DCBL (with its subsidiaries) in DCNEL has increased from 78.93% to
95.40%. Further, the voting rights of DCBL in DCNEL have increased from 76.00% to 95.28%.
(iii) Dalmia Bharat Green Vision Limited:
Dalmia Bharat Green Vision Limited (DBGVL), a wholly owned subsidiary of DCBL was incorporated to set up three green field cement projects in Tuticorin, South Chennai and North Bihar. Initially proposed to add 5.5 MnTPA cement capacity. The North Bihar project with capacity of 2.5 MnTPA is deferred for the time-being. DBGVL has commenced commercial production at the new greenfield cement grinding unit at Sattur, Tamil Nadu. The said grinding unit is called as Meenakshi Cement Works (MCW) having capacity of 2.00 MTPA.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis of financial performance and results of operations of the Company, as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) is provided in a separate section and forms an integral part of this report. It inter-alia gives details of the overall industry structure, economic developments, performance and state of affairs of your Companys business, risks and concerns and material developments during the financial year under review.
DIVIDEND
The Board of Directors at their meeting held on April 24, 2024, has recommended payment of RS.5/- (@ 250%) per equity share of the face value of RS.2/- each as final dividend for the financial year ended March 31, 2024. The payment of final dividend is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company. The recommended final dividend shall be paid to those shareholders whose names appear in the Register of Members as on the Record Date, on approval by the members at the Annual General Meeting.
During the year under review, the Board of Directors of the Company at their meeting held on October 14, 2023, also declared an Interim dividend of RS.4/- (@200%) per equity share of the face value of RS.2/- each. The interim dividend was paid to the shareholders on October 31, 2023.
The total dividend for the financial year 2023-24, including the proposed final dividend, amounts to RS.9/- (@ 450%) per equity share of the face value of RS.2 each in consistency with the dividend ofRS.9/- (@450%) per equity share of the face value of RS.2 each paid for the previous financial year 2022-23.
In view of the provisions of the Income-tax Act, 1961, dividends paid or distributed by the Company shall be taxable in the hands of the Shareholders. The Company shall, accordingly, make the payment of the final dividend after deduction of tax at source.
The Board of Directors recommends the dividend after considering the financial and non-financial factors prevailing during the financial year under review and in terms of the Dividend Distribution Policy of the Company. The said policy is available at the website of the Company at:
https://www.dalmiacement.com/wp-content/themes/DalmiaCement/
assets/pdf/dbl-industries/Dividend-Distribution-Policv.pdf
TRANSFER TO GENERAL RESERVES
Your Directors have not proposed to transfer any amount to the General Reserve.
CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements of your Company for the Financial Year 2023-24 are prepared in compliance with applicable provisions of the Companies Act, 2013, Accounting Standards and Listing Regulations. The consolidated financial statements have been prepared on the basis of audited financial statements of the Company and its Subsidiary Companies, as approved by their respective Board of Directors and form an integral part of this Annual Report.
SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES
A report containing the salient features of the financial statements of the Companys subsidiaries, joint ventures and associate companies for the financial year ended March 31, 2024 in the prescribed form AOC-1 as per the Companies Act, 2013 is set out in Annexure 1 and forms an integral part of this Annual Report.
During the year under review, Dalmia Cement (Bharat) Limited (DCBL) is the material unlisted subsidiaries of the Company in terms of the Listing Regulations as amended from time to time and the Companys Policy for determining material subsidiary. In terms of the provisions of the Listing Regulations, DCBL continues to be material unlisted subsidiary of the Company during the year under review. Further, from FY 2024-25 , Dalmia Cement (North-East) Limited also became material unlisted subsidiary.
The said policy may be accessed at the Companys website at https://www.dalmiacement.com/wp-content/themes/ DalmiaCement/assets/pdf/dbl-industries/Policv-on-Material- Subsidiaries.pdf
As on March 31, 2024, the Company has 30 subsidiaries (including 1 LLP), and 2 joint ventures. During the financial year 2023-24, there has been no addition or deletion of number of subsidiaries of the Company. However, 5 Companies ceased to be associate of the Company on April 25, 2023.
The Financial Statements of the Company/its subsidiaries and the Consolidated Financial Statements of the Company including all other documents required to be attached thereto, are placed on the Companys website www.dalmiabharat.com. These documents will also be available for inspection on all working days, during business hours, at the registered office of the Company and any member desirous of obtaining a copy of the same may write to the Company Secretary.
NUMBER OF BOARD MEETINGS
During the year under review, the Board of Directors of the Company met Seven (7) times, i.e., on April 25,2023, May 26,2023, July 20, 2023, August 29, 2023, October 14, 2023, December 05, 2023, and January 24, 2024. The Board meetings are conducted in due compliance with; and following the procedures prescribed in the Companies Act, 2013 and the rules framed thereunder including secretarial standards and the Listing Regulations. Detailed information on the meetings of the Board is included in the report on Corporate Governance which forms part of the Annual Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
I. Change in Board composition:
During the year under review, the tenure of 3 Independent Directors viz. Mr. Pradip Kumar Khaitan, Mrs. Sudha Pillai and Mr. Virendra Singh Jain ended on October 14, 2023.
In orderto maintain the composition of the Board, based on the recommendation of Nomination and Remuneration Committee, the Board of Directors of the Company has appointed -
1. Mr. Paul Heinz Hugentobler and Mrs. Anuradha Mookerjee as Independent Directors effective from July 1, 2023. The shareholders at their Annual General Meeting of the Company held on June 30, 2023 approved their appointments.
2. Mr. Anuj Gulati as Independent Director of the Company effective from October 14, 2023. The shareholders through Postal Ballot resolution, passed on January 12, 2024, approved his appointment.
3. Mr. Haigreve Khaitan as Independent Director of the Company effective from April 1, 2024. The agenda for obtaining the approval of shareholders has been included in the Notice of ensuing Annual General Meeting.
II. Retirement by rotation and subsequent re-appointment:
Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Noddodi Subrao Rajan, Non-Executive Director of the Company, being longest in the office, is liable to retire by rotation at the ensuing Annual General Meeting (AGM) and being eligible offers himself for reappointment. Appropriate resolution for his reappointment is being placed for the approval of the shareholders of the Company at the ensuing AGM.
A brief profile of Dr. Rajan and other related information as stipulated under Regulation 36 (3) of the Listing Regulations, is appended in the Notice of AGM.
III. Appointment/Resignation/Cessation:
In accordance with the provisions of Sections 2(51) and section 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended from time to time, the following were the Key Managerial Personnel of the Company as on March 31,2024
1. Mr. Gautam Dalmia - Managing Director
2. Mr. Puneet Yadu Dalmia, Managing Director & CEO*
3. Mr. Dharmender Tuteja, Chief Financial Officer
4. Mr. Rajeev Kumar, Company Secretary
*Mr. Puneet Yadu Dalmia, has also been appointed as the Managing Director and CEO of Dalmia Cement (Bharat) Limited {DCBL), wholly owned subsidiary of the Company with effect from December 8, 2023. The Board of Directors of the Company had accorded their approval for the holding such office in DCBL under Section 203 of the Companies Act, 2013, in addition to his position as Managing Director & CEO in the Company.
IV. Declaration of Independence from Independent Directors:
YourCompany has received declarationsfrom all the Independent Directors namely, Mr. Paul Heinz Hugentobler, Mrs. Anuradha Mukerjee, Mr. Anuj Gulati, and Mr. Haigreve Khaitan confirming that they meet with the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and under Regulation 16 (1) (b) of the Listing Regulations and they have registered their names in the Independent Directors Databank. Further, pursuantto Section 164(2) of the Companies Act, 2013, all the Directors have provided declarations in Form DIR- 8 that they have not been disqualified to act as a Director.
In the opinion of the Board, Independent Directors fulfil the conditions specified in the Companies Act, 2013 read with the Schedules and Rules issued thereunder as well as under Listing Regulations and are independentfrom Management.
COMMITTEES OF THE BOARD
In order to adhere to the best corporate governance practices, to effectively discharge its functions and responsibilities and in compliance with the requirements of applicable laws, your Board has constituted several Committees, namely (a) Audit Committee
(b) Stakeholders Relationship Committee (c) Nomination and Remuneration Committee (d) Corporate Social Responsibility Committee and (e) Risk Management Committee.
The details with respect to the compositions, number of meetings held during the financial year 2023-24 and attendance of the members, powers, terms of reference and other related matters of the Committees are given in detail in the Corporate Governance Report which forms part of the Annual Report.
Apart from above, the Board constitutes several operational committees from time to time.
NOMINATION AND REMUNERATION POLICY
The Nomination and Remuneration Policy of the Company lays down the constitution and role of the Nomination and Remuneration Committee. The policy has been framed with the objective-
(a) To formulate the criteria for determining qualifications, competencies, positive attributes and independence for appointment of Directors of the Company;
(b) to ensure that appointment of directors, key managerial personnel and senior managerial personnel and their removals are in compliance with the applicable provisions of the Act and the Listing Regulations;
(c) to set out criteria for the evaluation of performance and remuneration of directors, key managerial personnel and senior managerial personnel;
(d) to recommend policy relating to the remuneration of Directors, KMPs and Senior Management Personnel to the Board of Directors to ensure:
(i) The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors and employees to effectively and qualitatively discharge their responsibilities;
(ii) Relationship of remuneration to performance is clear and meets appropriate performance benchmarks;
(iii) Align the growth of the Company and development of employees and accelerate the performance;
(iv) to adopt best practices to attract and retain talent by the Company; and
(e) to ensure diversity of the Board of the Company.
The policy specifies the manner of effective evaluation of performance of Board, its Committees and individual Directors to be carried out either by the Board, by the Nomination and Remuneration Committee or by an independent external agency and review its implementation and compliance. The Nomination and Remuneration policy of the Company can be accessed at https:// www.dalmiacement.com/wp-content/uploads/2023/06/2.-DBL- Nomination-and-Remuneration-Policv.pdf
ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OF DIRECTORS
Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations, the Board has carried out annual evaluation of (i) its own performance; (ii) Individual Directors Performance; (iii) performance of Chairman of the Board; and (iv) Performance of all Committees of Board for the Financial Year 2023-24.
The Boards functioning was evaluated on various aspects, including inter-alia the structure of the Board, meetings of the Board, functions of the Board, effectiveness of Board processes, information and functioning.
The Committees of the Board were assessed on inter-alia the degree of fulfilment of key responsibilities, adequacy of Committee composition and effectiveness of meetings.
The Directors were evaluated on various aspects such as attendance and contribution at Board/Committee meetings and guidance/ support to the Management outside Board/Committee meetings.
The performance of Non-Independent Directors, Board as a whole and the Chairman was evaluated in a separate meeting of Independent Directors. Similar evaluation was also carried out by the Nomination and Remuneration Committee and the Board. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent Director being evaluated.
Based on the feedback of the Directors and after due deliberations and taking into account the views and counter views, the evaluation was carried out in terms of the Nomination and Remuneration Policy. The Directors expressed their satisfaction with the evaluation process.
Further, the evaluation process confirms that the Board and its Committees continue to operate effectively and the performance of the Directors is satisfactory.
DIRECTORS RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:
(a) In preparation of the annual accounts for the year ended March 31, 2024, the applicable accounting standards have been followed and there are no material departures from the same;
(b) The Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
(c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;
(d) The Directors have prepared the annual accounts on a going concern basis;
(e) The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and
(f) The Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and the relevant board committees, including the Audit Committee, the board is of the opinion that the Companys internal financial controls were adequate and effective during FY 2023-24.
The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and that such systems are adequate and operating effectively.
PARTICULARS OF REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND EMPLOYEES
Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time are provided in the prescribed format and is attached and marked as Annexure - 2 and forms part of this report.
A statement showing the names of the top ten employees in terms of remuneration drawn and other employees drawing
remuneration in excess of the limits set out in Rules 5(2) and other particulars in terms of Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached and marked as Annexure-2A and forms part of this report.
None of the Directors or Managing Director or Whole Time Director and CEO of the Company, received any remuneration or commission, except sitting fees for attending meetings and Mr. Yadu Hari Dalmia as Advisor, from the Subsidiary Company of your Company.
CORPORATE GOVERNANCE REPORT
I n compliance with the provisions of Listing Regulations a separate report on the Corporate Governance for the financial year 2023- 24 forms an integral part of this Annual Report. The requisite certificate from Mr. R Venkatasubramanian , Secretarial Auditor of the Company confirming compliance with the conditions of Corporate Governance and from Secretarial Auditor that none of the Directors of the Company has been debarred or disqualified from being appointed or continuing as Director of the Company by Securities and Exchange Board of India/Ministry of Corporate Affairs or any such authority is also attached to the Corporate Governance Report.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
The Business Responsibility and Sustainability Report (BRSR), as stipulated under Regulation 34 (2) (f) of the Listing Regulations, describing the initiatives taken by the Company from environment, social and governance perspective forms part of the Annual Report prepared as per Integrated Reporting framework.
CHANGES IN SHARE CAPITAL
During the year under review, the Company has allotted 67,268 equity shares of RS.2/- each as ESOP to the eligible employees in accordance with DBL ESOP Scheme 2018. Post such allotment of shares, the Issued, Subscribed and Paid up equity share capital of the Company is RS.37.51 crore constituting of 18,75,47,629 equity shares of RS.2/- each.
EMPLOYEES STOCK OPTION SCHEME
I n terms of the Scheme of arrangement and amalgamation amongst Odisha Cement Limited ("ODCL" or "Company"), Dalmia Bharat Limited ("DBL") and Dalmia Cement (Bharat) Limited ("DCBL") and their respective shareholders and creditors, the Company has adopted the DBEL ESOP Scheme 2011 with a new name i e "DBL ESOP Scheme 2018” with the same terms and conditions. During the year under review, there has been no material change in the "DBL ESOP Scheme 2018" of the Company and the Scheme continue to be in compliance with relevant/applicable ESOP Regulations.
Further the details required to be provided under the SEBI (Share Based Employee Benefits) Regulations, 2014 are disclosed on the website of the Company and can be accessed on the Companys website at https://www.dalmiacement.com/wp-content/ uploads/2024/05/DBL-ESQP-Disclosure-as-on-March-31-2024.pdf
A certificate from the Secretarial Auditor of the Company certifying that the DBL ESOP Scheme 2018 has been implemented in accordance with the SEBI (Share Based Employee Benefits) Regulations, 2014 and in accordance with the Shareholders resolution will be made available electronically for inspection by the members during the AGM.
ANNUAL RETURN
As required under Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014 as amended from time to time, the Annual Return of the Company as on March 31, 2024 is available on the Companys website at https://www.dalmiacement.com/wp-content/uploads/2024/06/ DBL-Annual-Return-2023-2024.pdf
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Group has been following the concept of giving back and sharing with the under privileged sections of the society for more than eight decades. The CSR of the Group is based on the principal of Gandhian Trusteeship. For over eight decades, the Group has addressed the issues of health care and sanitation, education, rural development, women empowerment and other social development issues. The prime objective of our CSR policy is to hasten social, economic and environmental progress. We remain focused on generating systematic and sustainable improvement for local communities surrounding our plants and project sites.
The Board of Directors of your Company has formulated and adopted a policy on CSR. The said policy can be accessed at: https://www. dalmiacement.com/wp-content/uploads/2022/Q9/Corporate- Social-Responsibilitv-Policv.pdf
The Company has excess amount spent of RS.1.70 crore carried forward from the last year and during the year under review, the Company has spent an aggregate amount of RS.2.54 crore towards CSR activities as against the spending requirement of RS.83.37 lakh, being 2% of average net profit. As a result, the excess amount spent would be carried forward for set off in next financial year(s).
The annual report on CSR activities containing composition of CSR Committee and disclosure as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached and marked as Annexure - 3 and forms part of this report.
On consolidated basis the Group has spent RS.22 crore in FY 2023-24 towards CSR.
RELATED PARTY TRANSACTION POLICY AND TRANSACTIONS
All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in its ordinary course of business and on an arms length basis.
During the year, the Company had not entered into any contract/ arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions or which is required to be reported in Form No. AOC-2 in terms of Section 134(3){h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.
Related Party Transactions are placed before the Audit Committee for prior approval. Prior omnibus approval of the Audit Committee is obtained for the transactions exceeding the prescribed threshold limit which are repetitive in nature including the transactions where the subsidiary(ies) of the Company is a party, but the Company is not a party, except transaction with or amongst wholly owned subsidiaries.
There are no materially significant Related Party Transactions entered into by the Company during the year that required shareholders approval under Regulation 23 of the Listing Regulations, Dalmia Cement (North-East) Limited ("DCNEL"), a step down subsidiary of the Company has requested Dalmia Cement (Bharat) Limited (DCBL), a subsidiary to provide Corporate Guarantee for their Bank borrowings for an amount upto RS.1700 crore, which is a material related party transaction and hence the same has been put up before the shareholders for their prior approval.
I n compliance with the requirements of the Companies Act, 2013 and Listing Regulations, your Company has formulated a Policy on Related Party Transactions. The said policy was revised during the year to align it with the amendments in the Listing Regulations. The said policy is available on Companys website at https://www. dalmiacement.com/wp-content/uploads/2022/Q9/Policv-on- Related-Partv-Transactions.pdf
RISK MANAGEMENT
Yourcompany has meticulously designed a robust Risk Management Framework to proactively identify, assess, and mitigate risks. This framework serves as a strategic shield, enabling the Company to navigate uncertainties effectively. Key features include:
• Risk Identification: Rigorous processes allow us to identify potential risks across various dimensions.
• Risk Assessment: We evaluate risks based on their impact and likelihood, ensuring a comprehensive understanding.
• Risk Mitigation: Adequate measures are implemented to minimise adverse effects.
• Monitoring and Reporting: Regular monitoring ensures timely intervention, and transparent reporting keeps stakeholders informed.
The Risk Management Committee (RMC) plays a pivotal role in overseeing risk-related activities. Key responsibilities of RMC include:
• Monitoring and Review: The Committee continuously monitors and reviews our risk management plan and processes.
• Holistic Approach: It addresses a wide spectrum of risks, including strategic, financial, liquidity, security (including cyber security), regulatory, legal, and reputational risks.
• Policy Formulation: The Committee ensures the existence of a robust Risk Management Policy that guides our risk mitigation efforts.
Your Company has appointed a Chief Risk Officer (CRO) who spearheads risk management initiatives. The CRO collaborates with business units, assesses risk exposure, and recommends appropriate actions.
Our approach to risk assessment follows a systematic procedure:
1. Identification: We proactively identify major risks across the organisation.
2. Classification: Risks are categorised based on their significance and likelihood.
3. Prioritisation: We prioritise risks to allocate resources effectively.
We assure our stakeholders that there are no elements of risk that, in the opinion of the Board, threaten the existence of the company. Our commitment to sound risk management practices ensures continuity and resilience.
For detailed insights into our risk management practices, please refer to the Corporate Governance Report, which is an integral part of this Annual Report.
This comprehensive overview underscores our commitment to prudent risk management and strategic resilience. We appreciate the collective efforts of our teams and stakeholders in safeguarding our organizations future.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
Your Company has in place adequate internal financial control systems commensurate with the size of operations. The policies and procedures adopted by your Company ensures the orderly and efficient conduct of business, safeguarding of assets, prevention and detection of frauds and errors, adequacy and completeness of the accounting records, and timely preparation of reliable financial information. The entire system is complemented by Internal audit conducted by reputed external firm of Chartered Accountants on selected functions such as Human Resource, Logistics, material movement, legal Compliances, SAP - IT ERP system and IT general controls.
The internal auditors of the Company conduct regular internal audits as per approved plan and the Audit Committee reviews periodically the adequacy and effectiveness of internal control systems and takes steps for corrective measures whenever required. There are established Cause-Effect-Action (CEA) systems and escalation matrices to ensure that all critical aspects are addressed well in time.
WHISTLE BLOWER POLICY AND VIGIL MECHANISM
In Compliance with the provisions of Section 177 of the Companies Act, 2013 and Regulation 22 of the Listing Regulations as amended from time to time, the Company has in place the Whistle Blower Policy and Vigil Mechanism for Directors, employees and other stakeholders which provides a platform to them for raising their voice about any breach of code of conduct, financial irregularities, illegal or unethical practices, unethical behaviour, actual or suspected fraud. Adequate safeguards are provided against
victimisation to those who use such mechanism and direct access to the Chairman of the Audit Committee in appropriate cases is provided. The policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination is made against any person. The Whistle Blower Policy and Vigil Mechanism may be accessed on the Companys website at https://www.dalmiacement.com/wp-content/themes/ DalmiaCement/assets/pdf/dbl-industries/Whistleblower-Policv- and-Vigil-Mechanism.pdf
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Your Company is committed to ensure that all are treated with dignity and respect. Company has zero tolerance towards any action of any executive which may fall under the ambit of Sexual Harassment at workplace and is fully committed to uphold and maintain the dignity of every women working in your Company. The Human Resource and the Legal department in collaboration with other functions, ensure protection against sexual harassment of women at workplace and for the prevention and redressal of complaint in this regard.
In line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, an Anti-Sexual Harassment Policy has been put in place and Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. During the financial year 2023-24. One Complaint was received during the year which stands disposed off as on date of this report.
LOANS, GUARANTEES, SECURITY AND INVESTMENTS
Your Company has given loans and guarantees, provided security and made investments in other Companies with the requisite approval and in compliance with the provisions of Section 186 of the Companies Act, 2013. The particulars of such loans and guarantees given, securities provided and investments made are provided in the Standalone Financial Statements at note no 35.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE TRANSACTIONS
The particulars of energy conservation and technology absorption are not applicable to the Company as it is not engaged in any manufacturing activity.
The disclosure of foreign exchange earnings and outgo, in terms of provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, as amended from time to time, is given hereunder:
Foreign Exchange earnings and outgo
(7 in crore)
Foreign Exchange |
2023-2024 | 2022-2023 |
Earnings |
Nil | Nil |
Outgo |
0.03 | 2.67 |
AUDITORS AND AUDITORS REPORT
A. Statutory Auditors and their report
M/s Walker Chandiok & Co LLP, Chartered Accountants (Firm Registration No. 001076N/N500013) were appointed as the Statutory Auditors of the Company at the 8th Annual General Meeting held on September 29, 2021 for a period of 5 years to hold office till the conclusion of 13th Annual General Meeting of the Company to be held in the year 2026.
The Company has received written consent and certificate of eligibility in accordance with Sections 139,141 and other applicable provisions of the Act and Rules issued thereunder, from M/s Walker Chandiok & Co LLP. They have confirmed to hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI) as required under the Listing Regulations.
There is no qualification, reservation or adverse remark in their report on Standalone Financial Statements. The notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any comments and explanation. The Auditors have not reported any matter under Section 143 (12) of the Act during the year under review.
The Report submitted by the Statutory Auditors on the consolidated financial statements of the Company do not contain any qualification, reservation or adverse remark or disclaimer. However, the Statutory Auditors in their report on the consolidated financial statements included matters of emphasis regarding (a) Profit before tax from continuing operations for the financial year ended March 31, 2024 was lower by RS.203 crore, in view of amortisation of goodwill pursuant to the National Company Law Tribunal approved Scheme of Arrangement and Amalgamation; (b) in respect of dispute between one of the Companys subsidiary namely Dalmia Cement (Bharat) Limited (DCBL) and Bawri Group (BG) shareholder of a step down subsidiary. During the year, Arbitral Tribunal has passed the Award according to which DCBL has to pay RS.30 crore along with interest and cost of arbitration amounting to RS.16 crore to BG. The Award has further rejected DCBLs claim of refund of RS.59 crore in respect of investment in optionally redeemable convertible debentures and awarded to transfer 0.01% equity in Saroj Sunrise Private Limited (a BG Group company) against it. Based on the legal opinion, DCBL has challenged the above arbitral award before the Honble Delhi High Court. The Court has stayed the operation and execution of the Award qua the amounts awarded against DCBL subject to deposit of certain amounts with the Court, which deposit has been made. Management is of the view that no adjustments are required towards the interest, charges and impairment of investment in these consolidated financial Statements; (c) Release of mutual fund units to DCBL pursuant to Honble Supreme Court order, upon furnishing of Bank Guarantee of RS.344 crore in Trial Court; and (d) accounting of the scheme(s) from the appointed dates being April 1, 2019 and April 1, 2020, respectively as approved by the National Company Law Tribunal, though the schemes has become
effective on March 1, 2022 and restatement of comparative for the previous year by the management of DCBL.
The said Emphasis of Matters have been explained and clarified in note no. 4(b)(ii), note no. 37(B); note no. 9(i)(2) and note no 54 of the notes to accounts to the Consolidated Financial Statements of the Company for the year ended March 31, 2022, which are self-explanatory and do not call for any further comments and explanation.
With respect to the report of the Statutory Auditors on the consolidated financial statements, regarding disclosure made under the heading other matters, with respect to consolidation of management certified financial statements of a joint venture company; it may be noted that since the audit of the said joint venture company is yet to be completed, the consolidation is made based on the unaudited financial statements furnished by its management. This has no material impact on the financial statement.
B. Secretarial Auditor and their Report
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed Mr. R. Venkatasubramanian, Practicing Company Secretary, as the Secretarial Auditor the Financial Year 2023-24.
As required under Section 204 of the Companies Act, 2013 and the Listing Regulations, the Secretarial Audit Report(s) in Form MR-3 of the Company for the FY 2023-24 is attached and marked as Annexure - 4 and form part of this report. There is no qualification, reservation or adverse remark in the said Secretarial Audit Report(s), however they have highlighted in their report that National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) as perSEBI Circular no SEBI/HO/ CFD/POD2/CIR/P/2023/120 dated July 11, 2023 read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations), issued notice to the alleged violation of Regulation 17(1) of the SEBI Listing Regulations pertaining to composition of Board of Directors and imposing fine aggregating to RS.7.80 lakh. The Company had paid the fines of RS. 10.10 lakh calculated upto 23rd January, 2024, under protest and submitted application for waiver to NSE and BSE, which has since been rejected. The Company is exploring further course of action.
Additionally, as required under the Listing Regulations, the secretarial audit of Dalmia Cement (Bharat) Limited and Dalmia Cement (North East) Limited, material subsidiaries, has also been carried out. Copy of Secretarial Audit Report(s) of said material subsidiaries is available at Companys website at www.dalmiabharat.com.
COST RECORDS AND COST AUDIT
Maintenance of cost records and requirement of cost audit as
prescribed under the provisions of Section 148(1) of the Companies
Act, 2013 are not applicable for the business activities carried out
by the Company.
DEPOSITS
During the year under review, the Company has not accepted any deposits under Sections 73 and 74 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has complied with all the applicable Secretarial Standards (SS) issued by the Institute of Company Secretaries of India from time to time and approved by the Central Government.
SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS
There are no significant or material orders which were passed by the Regulators or Courts or Tribunals which impact the going concern status and the Companys Operations in future.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
No material changes and commitments, other than disclosed as part of this report, affecting the financial position of the Company have occurred between March 31, 2024 and the date of the report.
NO APPLICATION HAS BEEN MADE UNDER THE INSOLVENCY AND BANKRUPTCY CODE
No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the year along with their status as at the end of the financial year is not applicable.
NO DIFFERENCE IN VALUATION
The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banksor Financial Institutions along with the reasons thereof, is not applicable.
ACKNOWLEDGEMENT & APPRECIATION
The Board of Directors wishes to extend heartfelt gratitude to various stakeholders who have contributed significantly during the past year. We deeply appreciate the unwavering support and cooperation received from Government Authorities for their guidance and regulatory framework have been instrumental in our operations; Financial Institutions and Banks for their financial backing and strategic partnerships have strengthened our position; Customers for their trust and loyalty drive our commitment to excellence; Vendors for their reliability and quality services have been invaluable and Members for their active participation and engagement enrich our corporate community. Additionally, we acknowledge the dedicated efforts of our executives, staff, and workers. Their tireless commitment ensures our continued success. Thank you for being an integral part of our journey.
For and on behalf of the Board of Directors
| Yadu Harl Dalmla | |
Place: New Delhi |
Chairman |
Dated: May 28, 2024 |
DIN- 00009800 |
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