Dear Members,
Your Directors have pleasure in presenting their 71st report on the
operations and business performance of your Company along with the audited Financial
Statements for the financial year 2022-23.
Financial Highlights
(H Crore)
| Particulars |
FY (2022-23) |
FY (2021-22) |
| Net Sales Turnover |
3252.08 |
3006.86 |
| EBIDTA |
512.11 |
506.58 |
| Less: - Interest & Financial Charges |
37.68 |
34.82 |
| PBDT |
474.43 |
471.76 |
| Less: - Depreciation & Impairment review impact |
121.25 |
72.92 |
| PBT |
353.18 |
398.84 |
| Less: - Tax |
|
|
| Current Tax |
94.12 |
104.47 |
| Deferred Tax |
10.74 |
(13.49) |
| Profits after tax from continuing operations |
248.32 |
307.86 |
| Profit before tax from discontinued operations |
2.39 |
(19.21) |
| Less: - Tax |
0.64 |
(6.71) |
| Profits after tax from discontinued operations |
1.75 |
(12.50) |
| Profits after tax- (continuing and discontinued) |
250.07 |
295.36 |
| Add: - Surplus brought forward |
1,960.56 |
1,737.16 |
| Balance available for appropriation |
2,210.63 |
2,032.52 |
| Appropriations |
|
|
| Adjustment in pursuant to merger with subsidiary company |
- |
23.41 |
| Dividend |
32.38 |
48.55 |
| Balance carried Forward |
2,178.25 |
1,960.56 |
Operational and Business Performance
During the year under review, your Company has successfully commissioned Jawaharpur
grain-based distillery of 110 KL, Ninaidevi sugar expansion from 3000 to 4000 TCD and
Ramgarh steam saving devices project.
Your Company has been successful in generating sustained profitability and enhancing
stakeholders value. Your Company could withstand volatility because of its inherent
strengths developed in course of time with tremendous focus on cane development
activities, manufacturing processes and optimum integration.
3 out of 5 plants (Ramgarh, Ninaidevi and Nigohi) have crushed the highest ever cane
during the sugar season 2022-23.
Looking at the economics and as a prudent production planning considering ethanol
blending program the company has diverted highest ever sugar towards distillery. (around
1.8 LMT) Kolhapur and Ninaidevi plants stood at No. 1 & No. 2 in the state of
Maharashtra in terms of sugar recovery.
The Company achieved the highest ever distillery production and sales during the year.
To reduce dependence on outside fuel (coal) Kolhapur distillery boiler was enabled for
bagasse consumption during the year. Total annualised capacity of distilleries as at the
year-end is increased to around 20 crore litres.
Company is in the process of installing/expanding: -
300KLPD Grain based distillery at its Nigohi unit,
Expansion of the Jawaharpur grain-based distillery from 110KL to 250 KL,
Installing the steam saving devices at Nigohi plant,
Capacity expansion at Ramgarh sugar unit from 6600 TCD to 7000 TCD; and
Debottlenecking the Ninaidevi capacity to reduce breakdowns.
Financial milestones:
Turnover – stood at Rs 3328 Crore as against Rs 3071 Crore last year
PBT - Rs 355 Crore as against Rs 380 Crore last year.
PAT - Rs 250 Crore as against Rs 295 Crore last year
Further, the working results for key businesses are attached and marked as Annexure
- 1 and forms part of this report.
Management Discussion and Analysis Report
Management Discussion and Analysis of financial performance and results of operations
of the Company for the year under review, as stipulated in the Securities and Exchange
Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI
Listing Regulations"), giving detailed analysis of the overall industry
structure, economic developments, performance and state of affairs of your Companys
business and material developments during the financial year 2022-23 is provided in a
separate section and forms part of the Annual Report.
The Company continued to be engaged in the same business during the financial year
2022-23. There were no material changes and commitments affecting the financial position
of the Company, which occurred between the end of the financial year to which the
Financial Statements relate and the date of this Report.
Dividend
The Board of Directors has, at its meeting held on May 19, 2023, recommended a final
dividend of Rs.1/- (50%) per equity share of the face value of Rs 2/- for the FY 2022-23,
having considered various financial and non-financial factors prevailed during the year,
in terms of the Dividend Distribution Policy of the Company. The dividend shall be paid
upon approval by the members at the Annual General Meeting to all the shareholders (with
respect to shares held in physical form) / beneficial owners (with respect to shares held
in Demat form) whose names appear in the Register of Members / Beneficial Owners as on the
Record Date, i.e., August 04, 2023. In view of the changes made under the Income-tax Act,
1961, by the Finance Act, 2020, dividend shall be paid to the shareholders after deduction
of applicable tax at source. During the year under review, the Board of Directors of the
Company had, at its meeting held on February 03, 2023, declared an Interim dividend of Rs
3/- (150%) per equity share of the face value of Rs 2/- for the FY 2022-23. The interim
dividend was paid to the shareholders on February 24, 2023.
During the previous FY 2021-22, the Company had paid a dividend of Rs 4/- (200%) to its
shareholders which is similar to the year under review.
The Dividend Distribution Policy of the Company is available at the website of the
Company at https://www.dalmiasugar.
com/wp-content/uploads/2023/02/Dividend-Distribution-Policy-03.02.23.pdf.
Transfer to General Reserves
Your Directors have not proposed transfer of any amount to the General Reserve for the
year under review.
Financial Statements
In accordance with the provisions of the Companies Act, 2013 read with the Indian
Accounting Standards (Ind AS), the Financial
Statements of the Company for the financial year 2022-23 have been prepared and form
part of the Annual Report.
Scheme of Amalgamation
The Scheme of Amalgamation involving amalgamation of the wholly owned subsidiary namely
Himshikhar Investment Limited with the Company has been approved and sanctioned by the
Honble National Company Law Tribunal, Chennai Bench vide Order dated June 10, 2022
(‘NCLT Order).
Pursuant thereto, the Company has surrendered the NBFC registration of Himshikhar
Investment Limited to the Reserve Bank of India.
Subsidiaries, Associates and Joint Venture Companies
The Companys wholly owned subsidiary i.e., Himshikhar Investment Limited has got
amalgamated pursuant to the NCLT Order. Hence, the Company has no subsidiary as on March
31, 2023. In terms of the SEBI Listing Regulations, as amended from time to time, the
Companys Policy for determining Material Subsidiary may be accessed at
https://www.dalmiasugar.com/
wp-content/themes/Sugar/assets/policies/Policy-on-Material-Subsidiaries.pdf The Company
has no Associates or Joint Venture companies. The Financial Statements of the Company are
placed on the Companys website at www.dalmiasugar.com. Any member desirous of obtaining a
copy of the Financial Statements may write to the Company Secretary in terms of Section
136 of the Companies Act, 2013.
Directors and Key Managerial Personnel
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Shri T.
Venkatesan, Director (DIN: 00124050), is liable to retire by rotation at the forthcoming
Annual General Meeting of the Company who has offered himself for reappointment. The Board
of Directors recommends his reappointment.
All the Independent Directors of the Company, namely Shri Rajeev Bakshi, Smt. Amita
Misra and Shri P. Kannan have given declaration(s) that they meet the criteria of
independence. In terms of Section 203 of the Companies Act 2013, Shri Gautam Dalmia,
Managing Director, Shri Bharat Bhushan Mehta, Whole Time Director and Chief Executive
Officer, Shri Anil Kataria, Chief Financial Officer and Ms. Aashhima V Khanna continue to
hold their positions as Key Managerial Personnel of the Company.
Board meetings
During the year under review, the Board of Directors of the Company met four times,
i.e., on May 24, 2022, July 29, 2022, November 08, 2022 and February 03, 2023. The Board
meetings were conducted in due compliance with; and following the procedures prescribed in
the Companies Act, 2013, SEBI Listing Regulations and applicable Secretarial Standards.
Detailed information on the meetings of the Board is included in the report on Corporate
Governance which forms part of the Annual Report.
Committees of the Board
During the year under review, the Board of Directors was supported by six Board level
Committees viz, Audit Committee, Stakeholders Relationship Committee, Nomination and
Remuneration Committee, Corporate Social Responsibility Committee, Risk Management
Committee and Finance Committee.
The details with respect to the composition and number of meetings held during the
financial year 2022-23 and attendance of the members, terms of reference and other related
matters of the Committees are given in detail in the Corporate Governance Report, which
forms a part of the Annual Report. The recommendations made by the Committee(s) during the
year under review have been accepted by the Board of Directors.
Annual Evaluation of Board Performance and Performance of its Committees and of
Directors
During the year under review, the annual evaluation of performance of the Board,
Committees and individual Directors was carried out by the Independent Directors and the
Board of Directors in compliance with the Companies Act, 2013 and SEBI Listing
Regulations.
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 inter-alia on 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. Performance evaluation of
Independent Directors was done by the entire Board, excluding the Independent Director
being evaluated.
Based on the feedback of the Directors given by way of rating and analysis thereof and
on due deliberations of the views and counter views, the evaluation was carried out in
terms of the Nomination and Remuneration Policy.
The evaluation confirmed that the Board and its Committees continued to operate
effectively and the Directors had met the high standards professing and ensuring best
practices in relation to corporate governance of the Companys affairs.
Directors Responsibility Statement
Pursuant to Section 134(3)(c) of the Companies Act, 2013, your Directors, state that:
(a) in preparation of the annual accounts for the year ended March 31, 2023, 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.
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
following objectives: (a) 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 Companies Act, 2013 and the SEBI Listing Regulations; (b) To
set out criteria for the evaluation of performance and remuneration of directors, key
managerial personnel and senior managerial personnel; (c) To recommend to the Board, the
remuneration payable to senior management; (d) 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.dalmiasugar.com/wp-content/themes/Sugar/
assets/policies/Nomination-and-Remuneration-Policy.pdf.
Particulars of remuneration of Directors, Key Managerial Personnel and Employees
The details relating to the ratio of the remuneration of each Director to the median
employees remuneration and other prescribed details in terms of Section 197(12) of the
Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 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.
Share Capital
During the year under review, pursuant to the amalgamation of Himshikhar Investment
Limited with the Company, the Authorised Capital of Himshikhar Investment Limited got
combined with the Authorised Capital of the Company and the same got increased from Rs
40,00,00,000 to Rs 40,50,00,000. There was however no change in the Issued, Subscribed and
Paid up equity share capital of the Company and it remained Rs 16.18 Crore consisting of
8,09,39,303 equity shares of Rs 2/- each.
Investor Education and Protection Fund
During the year under review, no shares were due to be transferred to Investor
Education and Protection Fund nor was any amount transferred out of unclaimed dividend
account.
Annual Return
In terms of Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013
Companies (Management and Administration) Rules, 2014, the Annual Return of the Company
has been placed at https://www.dalmiasugar.com/wp-content/
uploads/2023/07/Annual-Return-2022-23.pdf
Corporate Governance Report
Your Directors are committed to achieve the highest standards of ethics, transparency,
corporate governance and continue to comply with the Code of Conduct. The endeavour is to
enhance the reputation as a responsible and sustainable Company to attract and retain
talents, customers, suppliers, investors and to maintain fulfilling relationships with the
communities.
The strong corporate governance and zeal to grow has helped us to deliver the best
value to the stakeholders. We have always been positively cautious about the near term and
optimistic about the medium and long term in view of the improved macro indicators for the
economy, significant growth in public spending and focused execution plans.
The Corporate Governance Report of the Company for the financial year 2022-23 as per
the SEBI Listing Regulations is attached hereto and forms part of the Annual Report.
Business Responsibility and Sustainability Report
Your Directors have provided Business Responsibility and Sustainability Report for the
FY 2022-23, which is mandatory for top 1000 companies by market capitalization with effect
from FY 2022-23 in terms of Regulation 34(2) of the Listing Regulations. Your Company is
at 625 number by market capitalization as of March 31, 2023. The Business Responsibility
and Sustainability Report on the following nine principles forms an integral part of the
Annual Report:
| P1 |
Businesses should conduct and govern themselves with integrity in a manner that is
ethical, transparent and accountable |
| P2 |
Businesses should provide goods and services in a manner that is sustainable and safe |
| P3 |
Businesses should respect and promote the well-being of all employees, including those
in their value chains |
| P4 |
Businesses should respect the interests of and be responsive towards all its
stakeholders |
| P5 |
Businesses should respect and promote human rights |
| P6 |
Businesses should respect, protect and make efforts to restore the environment |
| P7 |
Businesses when engaging in influencing public and regulatory policy, should do so in
a manner that is responsible and transparent |
| P8 |
Businesses should promote inclusive growth and equitable development |
| P9 |
Businesses should engage with and provide value to their consumers in a responsible
manner |
Corporate Social Responsibility (CSR)
The Company has been following the concept of giving back and sharing with under
privileged sections for more than eight decades. The Corporate Social Responsibility of
the Company is based on the principal of Gandhian Trusteeship. For over eight decades, the
Group addressed the issues of health care and sanitation, education, rural development,
women empowerment and other social development issues. The prime objective of our
Corporate Social Responsibility 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.
During the Financial Year 2022-23 in view of various amendments in the legal provisions
from time to time the Corporate Social Responsibility Policy was revised to incorporate
the amendments. The Corporate Social Responsibility Policy of the Company can be accessed
at https://www.dalmiasugar.com/wp-content/ uploads/2023/02/DBSIL-CSR-Policy-03.02.23.pdf.
Pursuant to the said Policy, the Company has spent Rs 6.97 Crore towards corporate
social responsibility activities including livelihood, climate action, social
infrastructure during the financial year 2022-23 and no amount has been transferred to
Unspent Corporate Social Responsibility Account. The annual report on corporate social
responsibility activities is attached and marked as Annexure – 3 and forms
part of this report.
Related Party Transaction Policy and Transactions
All related party transactions entered during the year under review were on an arms
length basis and in the ordinary course of business and were in compliance with the
applicable provisions of the Companies Act, 2013 and SEBI Listing Regulations.
All related party transactions were placed before the Audit Committee for prior
approval. Prior omnibus approval of the Audit Committee was obtained for the transactions
which were repetitive in nature except when the need for them could not be foreseen in
advance.
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.
The Company has formulated a policy on materiality and on dealing with Related Party
Transactions and during the financial year 2022-23 in view of the various amendments in
the legal provisions from time to time, the Policy on Related Party Transactions has been
revised. The same can be accessed at
https://www.dalmiasugar.com/wp-content/uploads/2023/02/
DBSIL-Policy-on-Related-Party-Transactions-03.02.23.pdf.
Risk management policy
Your Company has a risk management policy, the objective of which is to lay down a
structured framework for identifying potential threats to the Company on a regular basis,
assessing likelihood of their occurrence, designate risk owners to continually evaluate
the emergent risks and plan measures to mitigate their impact on the Company, to the
extent possible. The framework and the system are reviewed from time to time to enhance
their usefulness and effectiveness.
The major risks are assessed through a systematic procedure of risk identification and
classification. Risks are prioritized according to significance and likelihood. The
purpose of risk management is not to eliminate risks but to proactively address them. The
Audit Committee oversees the risk management plan and ensures its effectiveness. There are
no elements of risk which in the opinion of the Board may threaten the existence of the
Company.
Whistle Blower Policy and Vigil Mechanism
In Compliance with the provisions of section 177 of the Companies Act, 2013 and
Regulation 22 of SEBI Listing Regulations, 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, health, safety and environmental issues. Adequate safeguards are provided against
victimization 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 for a genuinely raised concern. During the financial year
2022-23 year the Whistle Blower Policy and Vigil Mechanism of the Company has been revised
with a view to align with the various changes in law including but not limited to SEBI
Listing Regulations from time to time, to smoothen implementation and to address various
requirements of the Committee.
The Whistle Blower Policy and Vigil Mechanism can be accessed at
https://www.dalmiasugar.com/wp-content/themes/Sugar/
assets/policies/Whistleblower-Policy-and-Vigil-Mechanism.pdf
Adequacy of Internal Financial Controls
Your Company has in place adequate internal financial control systems to 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 internal auditors of the Company conduct regular internal audits as per approved
plans; 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-E_ect-Action (CEA) systems and escalation matrices to ensure that all
critical aspects are addressed well in time.
Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013
Your Company is committed to ensuring that all are treated with dignity and respect.
The Human Resource and the Legal & Secretarial 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. No complaint was received by ICC during
the financial year 2022-23.
Loans, Guarantees, Security and Investments
Your Company has given loans and guarantees, provided security and made investments
within the limits with the necessary approvals and in terms and accordance 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 Financial
Statements at note no. 44.
Energy Conservation, Technology Absorption and Foreign Exchange Transactions
A statement giving details of Energy Conservation, Technology Absorption and Foreign
Exchange Transactions, is given in Annexure – 4 and forms part of this Report.
Statutory Auditor and their report
NSBP & Co, Chartered Accountants (Firm Registration No. 001075N), Statutory
Auditors of the Company hold office till the conclusion of Seventy Fifth Annual General
Meeting of the Company to be held in 2027.
There is no qualification, reservation or adverse remark in their report on 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.
Cost Records and Auditor
Your Company maintains the cost records with respect to its sugar and power business in
terms of section 148 of the Companies Act, 2013 read with the Companies (Cost Records and
Audit) Rules, 2014. M/s R. J. Goel & Co., Cost Accountants, were appointed as the Cost
Auditors of the Company to conduct Cost Audit for the financial year 2022-23. They had
submitted the Cost Audit Report for the financial year 2021-22 on July 29, 2022.
Your Directors have re-appointed M/s R. J. Goel & Co., Cost Accountants, New Delhi,
as the Cost Auditors to conduct a cost audit for the financial year ended 2023-24 at
remuneration to be rati_ed by the shareholders at the forthcoming Annual General Meeting.
Secretarial Auditor and their Report
The Board has, in its meeting held on May 24, 2022, appointed M/s Vikas Gera &
Associates, Practicing Company Secretary, as the Secretarial Auditor of the Company for
the financial year 2022-23. As required under the Section 204 of the Companies Act, 2013
and SEBI Listing Regulations, the Secretarial Audit Report in Form MR-3 of the Company for
the financial year 2022-23 is attached and marked as Annexure – 5 and forms
part of this report. There is no qualification, reservation or adverse remark in the
Secretarial Audit Report.
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.
Awards and Recognition
Your Company continued its quest for excellence in its chosen area of business to
emerge as a true global brand. Several awards and rankings continue to endorse as a
thought leader in the industry. The Awards / recognitions received during the financial
year 2022-23 include:
1. IAPSIT – Industry Excellence Award in 7th International Sugar
Conference & Sugarcon 2022
2. Excellence Award for E_orts to boost Ethanol production, undertake development of
value-added products and diversification in process to produce sugar quality
3. Best Co-gen Plant, SDSK, Kolhapur
4. Best DM Plant Manager, Mr. Purushottam Singh, Nigohi Unit
5. Best Instrument Manager, Mr. Manish Kumar Agrawal, Kolhapur Unit
Other Disclosures
1. The Company had not accepted any deposits as per Section 73 of the Companies Act,
2013 read with Companies (Acceptance of Deposits) Rules, 2014.
2. There were no significant or material orders passed by the Regulators or Courts or
Tribunals which impact the going concern status and the Companys operations in future.
3. There was no application made or proceeding pending under the Insolvency and
Bankruptcy Code, 2016.
4. There was no one time settlement entered into with the Banks or Financial
Institutions.
Acknowledgement & Appreciation
Your Directors express their sincere appreciation for the assistance and co-operation
received from the Government authorities, financial institutions, banks, customers,
vendors and members during the year under review. Your Directors also wish to place on
record their deep sense of appreciation for the committed services by the Companys
executives, staff and workers.
|
For and on behalf of the Board of Directors |
| Gautam Dalmia |
Bharat Bhushan Mehta |
| Managing Director |
Whole Time Director and CEO |
| Dated: May 19, 2023 |
|
| Place: New Delhi |
|
+91-9892691696
