DIRECTOR
To
The Members,
Your Directors are pleased to present the 39th Annual Report of the Company together
with the Audited Accounts for the year ended on 30th September 2011.
Performance of the Company
| Financial Results |
|
(Rupees in Lacs) |
| Particulars |
2010 - 2011 |
2009 - 2010 |
| Sales (Net of Returns) |
8724.17 |
4269.64 |
| Profit (Loss) before Depreciation |
|
|
| Interest and Tax |
380.76 |
(343.37) |
| Interest and Finance Charge |
235.13 |
224.24 |
| Less : Provision for Depreciation |
279.33 |
298.39 |
| Profit (Loss) Before Tax |
(133.70) |
(862.00) |
| Profit (Loss) After Tax |
(133.70) |
(862.00) |
| Profit/(Loss) B/F from earlier years |
(6292.62) |
(5430.62) |
| (Loss) carried to Balance Sheet |
(6426.32) |
(6292.62) |
Management Discussions & Analysis
Operations
The overall total sales turnover of your company for the period under review stood at
Rs 8724.17 Lacs as compared to previous year Rs 4269.64 Lacs recorded an increase in
turnover by more than 100 %. The production for the year was 2.15 Lac bags as against 1.78
Lac bags in earlier year. As shown in the chart given below the mill crushed 23.99 Lac
qntls. of sugar cane during the year as against 20.72 Lac qntls crushed in previous year
with a paltry increase in recovery by 0.36%. The performance was better as compared to
previous year due to lower cost of cane and slightly better realization than last year.
Operational Performance
| Particulars |
Sugar Season |
|
2010 – 2011 |
2009 – 2010 |
| Commencement of the crushing season |
03.12.2010 |
05.12.2009 |
| Closing of Crushing Season |
14.03.2011 |
10.03.2010 |
| Cane Crushed (Lac Qntls.) |
23.99 |
20.72 |
| Recovery (percent) |
8.98 |
8.54 |
| Sugar Production (Lac Qntsl.) |
2.15 |
1.78 |
Dividend
In view of the loss incurred during the current year and brought forward losses, your
directors do not recommend any dividend for the current year.
Rehabilitation Scheme
The Company is a sick industrial company within the meaning of section 3 (1) (o) of the
Sick Industrial Companies (Special Provisions) Act, 1985.
Hon’ble Board for Industrial and Financial Reconstruction (BIFR) had approved
Rehabilitation Scheme vide their order dated 1st February, 2008 effective from
08.01.2008.
The reliefs and concessions as envisaged under the scheme interalia pertaining to
availability of adequate cane have not been implemented by the state of U.P. The mater has
been under litigation since 2005 at various forums including BIFR State Govt., appellate
authority, High Court. Finally the dispute came before the Hon’ble Supreme Court in
SLP No. 13912 of 2005 and 27653 of 2009. However a divisional bench of two judges referred
the mater to a larger bench of three judges. The matter is still pending. At the same time
the Uttarakhand Govt. did not cancel the license granted to a RAB plant of India Glycols
Ltd. However India Glycols Limited have not run their RAB plant in the season 2010-11 and
have also not run in the season 2011–12. The other reliefs are partially implemented
but they are not significant so as to make the plant viable under the rehabilitation
scheme, State Govt. loan of Rs. 7.87 Crores was to be converted into subsidy. But the
State Govt. has not implemented the same.
Finance
Due to inadequate availability the cane the Sugar unit of the Company has been working
at a capacity utilization of around 30%. It is most unlikely that the Company shall get
adequate Sugar Cane. At the same time with excessive higher cane price being fixed by the
State Govt. and lower sugar realisation the Company’s financial condition is not
likely to improve.
The company has also taken a decision to deposit Central Excise duty on Sugar and
molasses under protest pending decision by the appropriate court.
The Company has not accepted any deposit from the public.
Industry Outlook
During the year, pricing of sugar cane continues to be vexatious issue. Despite the
moderate increase in the SAP for the year. 2010-11, cane cost per MT of sugar in the state
is higher than the current realization in the domestic market.
There had been uncertainity about availability of Sugar Cane from the
erstwhile-reserved area in Uttar Pradesh. Therefore bringing value additions through
co-generation of power and manufacturing of Ethanol was not possible.
Internal Control System and their Adequacy
The company has proper and effective internal control system commensurate with size and
scale of business to ensure that all controls, procedures and policies of are adhered to.
Risks and Concerns
1. The Sugar industry is cyclical industry and its’ performance is subject to
climatic conditions like timely rainfall. The industry has been affected by drought and
irregular rain on various occasions
2. The Central Government/State Government fixes the raw material cost of cane without
referring it to prevailing sugar prices.
3. The sugar industry has to supply 10% of its production to Central Government as levy
Quota at the predetermined prices.
4. Central Government may allow import of white/raw sugar of concessional rates of
import duties, which will affect the sugar realization in domestic market.
Directors
In accordance with the provisions of the Companies Act, 1956 and Articles and
Association of the Company Sri Om Narayan, Dr S.L. Keswani and Sri Sharad Sharma retires
by rotation at ensuing Annual General Meeting of the Company and being eligible offer
themselves for reappointment.
Brief resumes of the directors being reappointed at the ensuing AGM is given in terms
of clause 49 of the listing agreement.
| Name |
Sri Om Narayan |
| Date of Appointment |
22.09.1989 |
| Age |
67 yrs. |
| Nature of expertise in specific areas |
Extensive experience in managing Sugar Mills. |
| Qualification |
IIT Graduate, Chemical Engineer |
| List of other Directorships held excluding alternate |
1. Dhampur Sugar Distillery P. Ltd. |
|
2. Dhampur Engineering Limited |
| Directorship and Private Companies |
|
| Chairman/Member of the |
1. Audit Committee of the Board |
| Committee of the Board of |
2. Share Transfer / |
| Directors of the Company |
Investor Grievance Committee |
|
3. Remuneration Committee |
| Chairman/Member of the Committee of the Board of Directors of other companies in which
he is a director |
None |
| Name |
Sri S L Keswani |
| Date of Appointment |
10.01.1973 |
| Age |
79 yrs |
| Nature of expertise in specific areas |
Extensive experience in managing corporate bodies and Consultants of paper Mills and
other Mills |
| Qualification |
Phd in Paper Technology |
| List of other Directorships held excluding alternate Directorship and Private
Companies |
Chem-Projects Consultants (P) Ltd. |
|
Perfect Pac (P) Ltd. |
|
Prakash Industries Limited, Khatima |
|
Paper & Board Mills Ltd. Chemcon |
|
Fabricatos (Delhi) Pvt. Ltd. Cheema |
|
Papers Ltd. |
|
Fuel Corp (India) Ltd. |
|
Fuel co-corp (India) Ltd Fuelco |
|
Ispat (India) Ltd. Fuelco Washeries |
|
(India) Ltd. Fuelco Power & |
|
Mining Ltd. |
| Chairman/Member of the Committee of the Board of Directors of the Company |
Member Audit Committee of the Board |
| Chairman/Member of the Committee of the Board of Directors of other Companies in which
he is a director. |
None |
| Name |
Sri Sharad Sharma |
| Age |
59 yrs |
| Date of Appointment |
29.11.2010 |
| Nature of expertise in specific areas |
Extensive experience in Corporate affairs. |
| Qualification |
Graduate |
| List of other Directorships held excluding alternate Directorship and Private
Companies |
Ujjal Rural Services Limited |
| Chairman/Member of the Committee of the Board of Directors of the Company |
None |
| Chairman/Member of the Committee of the Board of Directors of other companies in which
he is a director |
None |
Statutory Information
The Particulars of Employees’ remuneration under section 217(2A) of the Companies
Act. 1956
The Company’s does not have any employee drawing remuneration warranting
disclosure under Companies (Particulars of Employees) Rules, 1975.
The information as required under section 217(1) (e) of the Companies Act. 1956 read
with the Companies (Disclosure of Particulars in the report of the Board of Directors)
Rules, 1988 is given in the annexure forming part of this report.
Listing of Equity Shares
The Company’s securities are listed at the Stock Exchange, Mumbai (BSE), The Delhi
Stock Exchange Association Ltd., Delhi and the U.P. Stock Exchange Association Ltd.
Kanpur.
Report on Corporate Governance
A separate report on corporate governance pursuant to clause 49 of listing agreement
with Stock Exchange is separately given as part of Board Report.
Directors Responsibility Statement
Pursuant to the Provisions of Section 217(2AA) of the Companies Act, 1956 (here in
after referred as Act) your directors based on the representation from the operating
management confirm that
(i) In preparation of the Annual Accounts the applicable Accounting Standards have been
followed along with proper explanation relating to material departure.
(ii) They have in selection of the accounting policies consulted the Statutory Auditors
and applied them consistently and made judgments and estimates that are reasonable and
prudent so far as to give true and fair view of the state of affairs of the Company at the
end of Financial Year and of the loss of the company for the period.
(iii) They have taken proper and sufficient care to the best of their knowledge and
ability 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 fraud and other irregularities.
(iv) They have prepared the Annual Accounts on a ‘going concern basis’.
The required information in accordance with section 217(1)(e) of the Companies Act,
1956 read with Companies (Disclosure of particulars in respect of Board of Directors)
Rules 1988 is given in the annexure.
Personnel
Your directors sincerely appreciates the cordial and harmonious relations with the
staff , workers and other employees through out the year.
Audit Committee
The Audit Committee of the Board of Directors as required U/S 292A of the Companies
Act, 1956 consisting of the following Non–Executive and Independent Directors
• Dr. S.L. Keswani
• Sri Om Narayan Chairman
• Sri Amit Khandelwal
Auditors
M/s Mittal Gupta & Company, Chartered Accountants, Statutory Auditors of the
company will retire at the forth coming Annual General Meeting and being eligible offers
themselves for reappointment & proposed to be re-appointed.
Appreciation
We take this opportunity to place on record our appreciation for the continued
co-operation and help extended to us by the various Financial Institutions and Banks. The
Board also appreciates the commitments and valuable contribution of all the employees in
ensuring the smooth operation of the company.
|
For and on behalf of the Board of Directors |
|
|
R.K. Agrawal |
Om Narayan |
|
Whole Time Director |
Director |
| Place : New Delhi |
|
|
| Dated : 29.11.2011 |
|
|
Addendum to the Director’s Report
Pursuant to Section 217(3) of the Companies Act, 1956 following explanations are given
on remarks contained in the Auditors Report :
Observations of Auditors in their report read with the relevant notes to account are
self-explanatory and therefore do not require further explanation.
ANNEXURE TO THE DIRECTORS REPORT ON PARTICULARS REQUIRED UNDER THE COMPANIES
(DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES 1988.
(A) Conservation of Energy
Energy conservation measures taken.
I. Instrumentation of Boilers and other machineries to save energy.
II. Steps are taken for further reduction of consumption of energy.
III. Total energy consumption per unit of Production is given as per FORM A enclosed.
(B) Technology Absorption
Efforts made in technology absorption are given as per FORM B enclosed.
(C) Foreign exchange earning and outgo.
The company has not earned any foreign exchange during the year under report.
The foreign exchange outgoings are outlined in note No.11 (b) in Schedule No.17.
FORM – A
Power and Fuel Consumption
|
Current Year |
Previous Year |
| 1. Electricity |
|
|
| (a) Purchased units |
251102 |
609602 |
| Total Amount (Rs.) |
966557.00 |
2462636 |
| Rate/Unit (Rs.) |
3.77 |
4.04 |
| (This is Factory Load only) |
|
|
| (b) Own Generators Through |
30680 |
49400 |
| Diesel Generators Units |
|
|
| Unit/Liter of HSD |
2.60 |
2.60 |
| Cost/Unit (Rs.) |
15.77 |
13.74 |
| Through Steam Turbine Units |
8556124 |
11277825 |
| 2. Coal (Used in Boiler) |
|
|
| Quantity (MT) |
NIL |
NIL |
| Total Cost (Rs.) |
NIL |
NIL |
| Average Rate Ton (Rs.) |
NIL |
NIL |
| 3. Other Internal Generation |
NIL |
NIL |
| 4. Consumption/MT of |
|
|
| Production |
|
|
| Production (Qtls.) |
216252 |
177700 |
| Electricity (Units/Qtls.) |
– |
– |
FORM–B
Disclosure of particulars with respect to Technology Absorption
Research & Development
1. Specific areas in which R & D carried by the Company.
M/s Dhampur Sugar Mills Ltd., Dhampur, the promoter Company has a separate Research
& Development department to develop new variety of seeds for higher sugar recovery.
2. Benefits derived as a result of above R & D :
Improvement in Product Quality, Higher yield of sugar cane and Better recovery have
been achieved.
3. Future Plan of Action
The Company proposes to introduce certain promising variety of cane suitable for its
area of operation.
The trial and experiment would be undertaken on continuous basis.
4. Expenditure in R & D
Expenditure made is non allocable.
Technology absorption, Adoption and innovation
(a) To Economise the operation and for energy conservation, technology available in
India like cooling towers and process control system have been installed.
(b) Improved juice clarification for manufacture of better quality sugar (Low ICUMSA)
5. Benefits derived as a results of the above efforts :
• Product quality has improved.
• Improved Technology :
| (a) Technology imported |
No technology was imported |
| (b) Year of import |
NIL |
| (c) Has technology been fully absorbed |
NA |
| Foreign Exchange Earnings and Outgo : |
|
| Earnings |
NIL |
| Outgo |
NIL |
|
For and on behalf of the Board of Directors |
|
|
R.K. Agrawal |
Om Narayan |
|
Whole Time Director |
Director |
| Place : New Delhi |
|
|
| Dated : 29.11.2011 |
|
|
+91-9892691696
