rana sugars ltd Management discussions

GLOBAL ECONOMIC OVERVIEW

The baseline forecast for the World Economy is that the growth to fall from 3.4 percent in 2022 to 2.8 percent in 2023, before settling at 3.0 percent in 2024. Advanced economies are expected to see an especially pronounced growth slowdown, from 2.7 percent in 2022 to 1.3 percent in 2023. In a plausible alternative scenario with further financial sector stress, global growth declines to about 2.5 percent in 2023 with advanced economy growth falling below 1 percent. Global headline inflation in the baseline is set to fall from 8.7 percent in 2022 to 7.0 percent in 2023 on the back of lower commodity prices but underlying (core) inflation is likely to decline more slowly. Inflations return to target is unlikely before 2025 in most cases. The natural rate of interest is important for both monetary and fiscal policy as it is a reference level to gauge the stance of monetary policy and a key determinant of the sustainability of public debt. Regarding Global Prospects and Policies, the tentative signs in early 2023 that the world economy could achieve a soft landing with inflation coming down and growth steady have receded amid stubbornly high inflation and recent financial sector turmoil. Although inflation has declined as central banks have raised interest rates and food and energy prices have come down, underlying price pressures are proving sticky, with labor markets tight in a number of economies. Side effects from the fast rise in policy rates are becoming apparent, as banking sector vulnerabilities have come into focus and fears of contagion have risen across the broader financial sector, including nonbank financial institutions. Risks to the outlook are heavily skewed to the downside, with the chances of a hard landing having risen sharply.

On Natural Rate of Interest front: The natural rate of interest the real interest rate that neither stimulates nor contracts the economy is important for both monetary and fiscal policy; it is a reference level to gauge the stance of monetary policy and a key determinant of the sustainability of public debt. To mitigate the uncertainty that typically surrounds estimates of the natural rate, the study relies on complementary approaches to analyze its drivers and project its future path. Overall, the analysis suggests that once the current inflationary episode has passed, interest rates are likely to revert toward pre-pandemic levels in advanced economies. How close interest rates get to those levels will depend on whether alternative scenarios involving persistently higher government debt and deficit or financial fragmentation materialize. Coming Down to Earth: How to Tackle Soaring Public Debt: Public debt as a ratio to GDP soared across the world during COVID-19 and is expected to remain elevated, posing a growing challenge for policymakers, particularly as real interest rates are rising across the world. Based on econometric analyses and complemented with a review of historical experiences, the study reaches three main conclusions. First, adequately timed and appropriately designed fiscal consolidations have a high probability of durably reducing debt ratios. Second, when a country is in debt distress, a comprehensive approach that combines significant debt restructuring renegotiation of terms of servicing of existing debt fiscal consolidation, and policies to support economic growth can have a significant and long-lasting impact on reducing debt ratios. Coordination among creditors is essential. Finally, economic growth and inflation have historically contributed to reducing debt ratios. Geoeconomic Fragmentation and Foreign Direct Investment: Supply-chain disruptions and rising geopolitical tensions have brought the risks and potential benefits and costs of geoeconomic fragmentation to the center of the policy debate. Several emerging market and developing economies are highly vulnerable to FDI relocation, given their reliance on FDI from geopolitically distant countries. In the long term, FDI fragmentation arising from the emergence of geopolitical blocs can generate large output losses, especially for emerging market and developing economies. Multilateral efforts to preserve global integration are the best way to reduce the large and widespread economic costs of FDI fragmentation. (Source: IMF, World Economic Outlook April 2023)

INDIAN ECONOMIC REVIEW

As per the report of S&P Global Ratings, India will remain the fastest growing economy among Asia Pacific nations. It has pegged a growth of 6 per cent previously in March and retained the same. India is likely to grow at 6.7 per cent for the next three years, retaining its tag as the fastest-growing major economy. The report stated that Asias emerging economies will remain the fastest-growing ones and India, along with Vietnam and Philippines will lead in growth outlook through 2026. India, Vietnam, and the Philippines continue to lead, with average growth of 6.7%, 6.6%, and 6.1%, respectively, in 2023 -2026. In India, they forecast growth of 6% in fiscal 2024 as reopening momentum gradually fades and tighter monetary policy restrains activity. Private consumer demand is slowing against this backdrop, with urban consumers faring better than rural. Agriculture and construction activity has shown resilient growth, though agriculture performance in the coming fiscal year will be affected by El Nino conditions. Beyond this fiscal year, we expect growth close to 7% on strong investmen t and domestic consumer demand. Retail inflation is expected to soften to 5 per cent this fiscal from 6.7 per cent.

Under the assumption of normal monsoons, we expect headline consumer inflation to soften to 5% in fiscal 2024 (ending March 31, 2024) from 6.7% the prior fiscal year. Softer crude prices and tempering of demand will bring down fuel and core inflation. The inflation and rate hike cycles have peaked, in our opinion. We dont expect the Reserve Bank of India to cut rates until early 2024 since it first wants to see consumer inflation moving to 4%, the center of its target range.

Indias economic growth in FY23 has been principally led by private consumption and capital formation. It has helped generate employment as seen in the declining urban unemployment rate and in the faster net registration in Employee Provident Fund. Recovery of MSMEs is proceeding apace, as is evident in the amounts of Goods and Services Tax (GST) they pay, while the Emergency Credit Linked Guarantee Scheme (ECGLS) is easing their debt servicing concerns. Total FDI inflows in the country in the FY 22-23 is $ 70.97 Bn and total FDI equity inflows stands at $ 46.03 Bn. The Foreign direct equity investments were down 21.67% from the previous year, according to the Department for Promotion of Industry and Internal Trade. In the January-March quarter, inflows were $9.28 billion, or 41% lower than the corresponding period previously. Total FDI inflows, including additional equity investments, reinvested earnings and other capital, contracted 29.6% to $15.49 billion in the fiscal fourth quarter. The year 2022-23 witnessed high volatility in major currencies due to geopolitical factors such as the Russia-Ukraine conflict and the sharp increase in interest rates by the US Federal Reserve. The Indian rupee was not immune to this and experienced a 7.8% depreciation against the US dollar in the outgoing financial year, the most significant fall since 2019-20. Although the rupee has fallen by about 8% against the US dollar for the second time since the 2013-14 currency crisis, it has still performed better than many other currencies, including the Chinese yuan, South Korean won, Malaysian ringgit, and Philippine peso. The rupee completed FY23 at 82.18 to the dollar, up from 75.79 the previous year. The weakening of the rupee could impact consumers as it may increase the price of imported goods and make studying abroad more expensive due to currency conversion fees. However, experts predict a more stable FY24 for the rupee as the market anticipates the Federal Reserve to reach the peak of its rate hike cycle, and Indias current account dynamics are also expected to change. The Reserve Bank of India (RBI) intervened in the foreign exchange market to curb volatility, and foreign exchange reserves, which stood at $606 billion on April 1, 2022, fell to $525 billion in the week ending October 21. Reserves have since increased, hitting $579 billion on March 24, 2023. Despite these measures, Ritesh Bhansali, vice-president of Mecklai Financial Services, says that the rupee remained bearish for 2022-23 due to stretched twin deficits, sticky inflation, and inflated oil prices, among other factors. The exodus of funds by foreign institutional investors (FIIs) also added to the woes of the rupee. Overall, the year 2022-23 was marked by high volatility in major currencies, including the Indian rupee, due to geopolitical factors and global economic developments. However, experts remain cautiously optimistic about the rupees prospects for FY24.

Indian economic reforms and Budget 2022-23 provisions

The Budget 2023-24 inter-alia speak about Indias vision for the Amrit Kaal includes technology-driven and knowledge-based economy with strong public finances, and a robust financial sector and to achieve this, Jan Bhagidari through Sabka Saath Sabka Prayas is essential. The economic agenda for achieving this vision focuses on three things and those are facilitating ample opportunities for citizens, especially the youth, to fulfill their aspirations, secondly, providing strong impetus to growth and job creation and finally to strengthen macro-economic stability. To service these focus areas in our journey to India@100, the four opportunities that can be transformative during Amrit Kaal are Economic Empowerment of Women, PM VIshwakarma KAushal Samman (PM VIKAS), Tourism and Green Growth The seven priorities listed in the Union Budget which complement each other and act as the ‘Saptarishi guiding us through the Amrit Kaal are 1) Inclusive Development 2) Reaching the Last Mile 3) Infrastructure and Investment 4) Unleashing the Potential 5) Green Growth 6) Youth Power 7) Financial Sector.

Outlook

The Indian Sugar Mills Association (ISMA) has released its second advanced estimate of sugar production for SS 2022-23 based on the images of harvested and balance area, field visits, the current trend of yields and sugar recoveries achieved till now. For the SS 2022-23, the total sugar production (after diversion towards ethanol) is estimated to moderate by 5% to 340 lakh tonnes as compared to the record high production of about 358 lakh tonnes in the last SS 2021-22. The total sugar production in Maharashtra is estimated to decline to 121 lakh tonnes in SS 2022-23 from 137 lakh tonnes in the previous season. Karnataka is likely to witness a decline to 56 lakh tonnes, whereas Uttar Pradesh may observe a minor decline to 101 lakh tonnes from 102 lakh tonnes in the previous season.

Trade body Indian Sugar Mills Association (ISMA) has lowered its sugar production estimate by 3.5%, while the estimated diversion of sugar to ethanol has also been cut by 11% in its latest estimate issued today over the earlier estimate issued in January. The All India sugar production after diversion for ethanol is projected to fall to 328 lakh tonnes from 340 lakh tonnes projected earlier, while the sugar production before diversion will slide to 368 lakh tonnes, down by 4.6% from 385 lakh tonnes of production. As per Indian Sugar Mills Association, an apex trade body, Indian sugar production is projected to increase by 4 million tonnes (MT) to 36 MT in the 2023-24 season (October 2023-September 2024), the US Department of Agriculture has said. But, India is likely to produce 32.8 MT of sugar in the 2022-23 marketing year, down 3.5 per cent from the previous forecast, as sugarcane yields in major producing States fell due to erratic weather conditions. Going forward, ethanol is set to become the money spinner for most of the sugar mills. Ethanol is a biofuel produced naturally through the fermentation of sugars by yeast. It is used in the production of drugs, plastics, polishes and cosmetics and also as an alternative fuel source. It is the latter that is going to bring a windfall for the sugar makers. S Ranganathan, Head of Research at LKP Securities has projected that the biggest tailwind for the large integrated sugar mills is that they have huge capacity to "supply ethanol to the three oil marketing companies at very profitable prices. These integrated sugar mills have de-risked their business model and today, the profitability from the ethanol business which constitutes 25-30 per cent of revenues is much higher than the sugar business." Additionally, the government will likely come out with a policy on flex-fuel cars. Although widespread use of such vehicles will take longer, a moderate adoption is enough to drive up ethanol consumption even after 2025. (Source ISMA, Economic Times, Hindu Business line)

GLOBAL SUGAR SECTOR OVERVIEW

As per the March, 2023 study of S & D Sucden, the world production-consumption oscillates between small deficits and surpluses over the recent years. This fragile equilibrium is reached with a sugar mix already maximized in Brazil Center South (CS) and this leaves no supply buffer to the market in case of a weather event. In addition, India will withdraw from the market for several months from now on, with no clear view as to when it will be back. This is symptomatic of the current tight trade flows environment. Three points of tension are particularly remarkable in the raw trade flows outlook. First, the ability to pass a historically tight intercrop that requires an early start of the CS crop, itself dependent on the end of the rains. Second, further into the CS harvest, the capacity of the logistic to match 90% of the large Q3 raws demand, when almost no alternative origin is available and while record grains crop leads to more competition for in-land and ports capacities. Ultimately, India raw exports will be again required to bridge the 24/25 CS crop. Next year Indian export policy presents again wild uncertainties as regards to the quota size and timeline: a deficient Indian monsoon remains a major risk. The white market is progressively exiting its current surplus situation. The concentration of the large Indian quota supplies in a short period of time pushed flows to destinations beyond regular demand. From May onward, when the Indian domestic sugar is not available anymore, Eastern Hemisphere markets will have to source from regional refiners, leaving a tighter balance sheet, although less than last year, given the higher CS crystal and Thai refined availability. Northern Hemisphere production will finally post an overall reduction of around 3Mt in 22/23. While Thailand and Russia did better, other major producers will post a drop as India, EU and Mexico. 23/24 may only see a limited increase, considering an expected normal weather pattern, as no growth is expected in sugar crops acreage. In the Southern Hemisphere, after a disastrous 21/22 crop and a modest 22/23 harvest, CS Brazil should be back to a much larger sugar production in 23/24, thanks to a good cane yield and low ethanol prices. For past and next years, the world Production Consumption oscillates from small deficit to surplus giving an overall balanced picture. However, this scenario is reached by a maximized sugar mix in Brazil, leaving no buffer in case of weather event: the prospect of El Nino could induce a weaker Asian monsoon. This should lead to tight trade flows over next 12 months, along with specific hurdles: the capacity to bridge with the coming 23/24 CS crop, the CS sugar logistics capacity to match demand while few other origins are available, and ultimately, the Indian political decision to release export quotas to pass next CS intersafra. (Source: S & D Scuden)

GLOBAL SUGAR PRICE TRENDS

The FAO Sugar Price Index fell for the first time in five months to 152.2 index points in June of 2023 from 157.2 in May which was the highest level since September of 2011. The decline in international sugar prices was mainly triggered by the good progress of the 2023/24 sugarcane harvest in Brazil and a sluggish global import demand, particularly from China. Raw sugar futures in the US fell to below 24 cents per pound from the one-month high of 25 cents touched on July 21st amid signs of ample supply from the worlds top producer and exporter, Brazil. Industry group Unica released data showing that

Brazils sugar output in the 2023/24 mid-year crop rose by 21.9% year-on-year halfway through July, supported by favorable weather conditions in the countrys center-south region. Still, poorer output prospects in Asia limited the decline. Persistent concerns about El Nino weather hampered production prospects from India, exacerbating troubles from recent dry weather that drove government officials to restrict export licenses. Additionally, higher fuel prices raised the demand for sugarcane as feedstock for ethanol, limiting the supply of raw sugar and also supporting prices. (Source: tradingeconimincs.com)

INDIAN SUGAR INDUSTRY OVERVIEW

Sugar Industry is an important Agro-based industry that impacts rural livelihood of about 5 crore sugarcane farmers & their families & around 5 lakh workers directly employed in sugar mills & other ancillary activities. Sugar production in India had been cyclic in nature. Every 2-3 years of high sugar production were followed by low sugar production. However, from the sugar season 2017-18 and onwards, the country has produced surplus sugar than the domestic requirement of about 250-265 Lakh Metric Tonnes.

Season wise production of sugar from 2011-12 and onwards- Sugar Season (October-September)	Production of Sugar (Qty. in lakh tonne)
2011-12	263
2012-13	252
2013-14	245
2014-15	284
2015-16	251
2016-17	202
2017-18	322
2018-19	332
2019-20	274
2020-21	310
2021-22	359
2022-23 (As on 21.03.2023)	288

With a view to enhance ethanol production capacity in the country, Government in July, 2018 & March, 2019 and subsequently in September, 2020 and in January, 2021 notified interest subvention schemes for setting up of new distilleries (molasses & grain based as well as using dual feed stock)/ expansion of existing distilleries/ installation of Zero Liquid Discharge (ZLD) System/installation of MSDH column etc. Under the scheme, the interest subvention is given @ 6% p.a. or 50% of the interest charged by banks, whichever is lower, shall be borne by the Government for five years including one-year moratorium. However, the production of ethanol through sugar based feedstocks will not be sufficient to meet the blending targets set under EBP Programme, therefore, Government allowed the production of ethanol from the grain based feed stocks also such as damaged food grains (DFGs), maize, surplus FCI rice, etc. In order to find a permanent solution to address the problem of excess sugar, Government is encouraging sugar mills to divert excess sugarcane to ethanol. Government has fixed target of 10% blending of fuel grade ethanol with petrol by 2022 & 20% blending by 2025. The target of 10% has been achieved successfully during Ethanol supply year (ESY) 2021-22.

Till year 2013, ethanol distillation capacity of molasses based distilleries was only 215 Cr litres. However, in past 10 years due to the policy changes made by the Government, the capacity of molasses based distilleries have been increased by more than three times and are currently at 723 Cr litres. Capacity of grain based distilleries are presently about 347 Cr litres. Thus, the overall capacity of ethanol production has reached to 1070 Cr litres. Till year 2013, supply of ethanol to OMCs was only 38 crore litres with blending levels of only 1.53 % in ethanol supply year (ESY) 2013-14. Production of fuel grade ethanol and its supply to OMCs has increased by more than 11 times from 2013-14 to 2021-22 and historically high figure of 408 crore liters of ethanol was supplied in ESY 2021-22. In ESY 2021-22, a historically high figure of about 433.6 crore litres of ethanol was blended thereby achieving 10.02% blending which was higher than the set target of 10% for ESY 2021-22.

Sugar Balance Sheet since 2018-19 sugar season and onwards

Particulars	2018-19	2019-20	2020-21	2021-22
Carry- over stocks with sugar mills from Previous season	106	145	110	85
Production of Sugar (after discounting diversion of 3 LMT)	332	274	310	359
Total	438	419	420	444
Domestic Consumption	255	249	265	273
Exports	38	60	70	110
Estimated Closing stocks at the end of season	145	110	85	61

With a view to support sugar sector and in the interest of sugarcane farmers, the Government has also allowed production of ethanol from B-Heavy Molasses, sugarcane juice, sugar syrup and sugar. Government is also encouraging distilleries to produce ethanol from food grains such as Damaged Food Grains(DFG), maize & rice available with FCI. Government has been fixing remunerative ex-mill price of ethanol derived from C-heavy & B-heavy molasses, ethanol derived from sugarcane juice/ sugar/ sugar syrup, ethanol produced from food grains such as Damaged Food Grains (DFG), maize & FCI rice.

DRIVERS OF SUGAR DEMAND IN INDIA

Population Growth: Indias population is growing at a rate of 0.81% and has reached 1.43 billion in 2023, the highest global population increment. The country is the most populous country in the world in terms of population and has surpassed China in Mid-June, 2023 to become the most populous country, catalyzing sugar demand. (Source: macrotrends.net) Growing confectionery sales: By 2025, the sugar confectionery market in India is estimated to reach 4.06 billion US$ (in retail prices), growing at a CAGR of 7.45% per annum for the period 2020-2024, driving sugar demand. (Source: market research.com)

Robust soft drinks consumption: Soft drinks industry in India is expected to grow annually by 9% between 2021 and 2025, strengthening the offtake of sugar. (Source: Economic Times)

Punjab Sugar Industry Overview

Punjab has increased the per hectare yield from 340 quintals per hectares in 1960-61 to 838.41 quintals per hectares last year. This year, the total area under the crop was 88,000 hectares (2,17,360 acres) and the average yield per hectare was 835.92 quintals (338.42 quintals per acre), which is second highest in the history of the state. Till 27^th March, 16 sugar mills of the state, including nine in cooperative sector and seven in private, have crushed 596.7 lakh quintals of cane and produced 54.5 lakh quintals of sugar by getting 9.31% sugar per quintal against 9.02% last year. Punjab Sugar Industry is currently going through difficult times just like the sugar industries of several other states in India. Financial and infrastructural problems are believed to be the main reasons behind the problems plaguing Punjabs sugar industry.

The cost of production of sugar is very high in Punjab, which is the main cause of the financial crunch. Because of this, the units engaged in sugar production are making huge losses. The Punjab sugar industry is facing tremendous odds and it has become extremely difficult to continue running the industry. The cost of sugar production is way beyond the present market price of the sugar, so it is not viable pertaining to the economic condition to continue with the production of sugar. The situation is very delicate and at the same time very strange because the farmers are demanding a price hike for their sugarcane whereas the mills are not able to pay the present rate at which sugar is sold. The situation is going to improve with the new methods of production. In order to make the sugar industry have sustainable growth, it is important to have an easy access to adequate amounts of basic ingredients at a competitive price structure in order to compete along with the other low cost sugar manufacturing countries such as Australia, Thailand, and Brazil. The cost of the sugarcane has to be economical to lower the production cost of sugar. Mechanized Pit Planning is a new kind of agricultural method which uses the latest techniques to boost the yield or the harvest by the means of organic techniques of agriculture. (Source: www.business.mapsofindia.com)

Uttar Pradesh Sugar Industry Overview

Uttar Pradesh Sugar Industry is one of the largest sugar industries in the Indian economy. The lavish measures in form of new promotional policies for the Uttar Pradesh sugar industry by the state government of Uttar Pradesh was introduced at a time when it was much needed to further boost the growth of the Uttar Pradesh sugar industry. The improvements in the plant capacity and the introduction of new techniques which enables the optimization of the existing plant capacities has the further made the growth definite. With the new promotional policies of the Uttar Pradesh sugar industry, the investors have already starting eying the future prospects. There are 20 more sugar processing units are coming up as a part of Uttar Pradesh sugar industry. The existing companies under the Uttar Pradesh sugar industry are planning an investment pertaining to expansion of about Rs 4,000 crore. At present the major companies in the Uttar Pradesh sugar industry are Balrampur Chini, Bajaj Hindusthan Ltd., etc. A batch of Brownfield and Greenfield expansion projects has already started their activities of crushing cane. The increase in the capacity would help the Uttar Pradesh sugar industry to churn out an extra 140,000 tons of crushed cane every day to the existing 2.5 million tons of sugar produced within a few years time. The total sugar production under the Uttar

Pradesh sugar industry would lead to 7.5 million tons, making Uttar Pradesh the biggest manufacturer of sugar in India.

The Uttar Pradesh sugar industry has a bright future as one of the prospective players in the global sugar market. The demand for sugar across the world has been growing exponentially. The Uttar Pradesh sugar industry with its capacity can cater to this international demand. The advantages of the Uttar Pradesh sugar industry are that the cost of production is quite low and the climatic conditions and the conditions of the soil are favorable to the sugarcane production. The region of India where the state of Uttar Pradesh lies is one of the most fertile lands in India called the doab. This is an extremely fertile belt of lands between the rivers Ganges and Jamuna. To boost the production of the Uttar Pradesh sugar industry, the government of Uttar Pradesh is likely to set up a research and development unit which would develop better quality sugarcane plants to have better yield and diseases-resistant crops to ensure that the industry has a sustainable growth. The geographical position of the state of Uttar Pradesh is one of the key advantages as it is very easy to access. With all these developments the Uttar Pradesh sugar industry can meet the increasing domestic demands in India, which due to the improvements in the economic conditions and the rise in the general income level. The present consumption of sugar is nearly 19 MT annually and it may go up to 24 MT on a yearly basis. At present, the situation of the Indian sugar production can improve with all these measures. In the financial year of 2004 -2005, India had to import 8.89 lakh tons of sugar from different countries due to the huge decline in the national sugar production. These measures would have a long term effect on the sugar production of the state and therefore of the entire country. (Source: www.business.mapsofindia.com)

India ethanol market size was estimated at USD 2.27 billion in 2022. During the forecast period between 2023 and 2029, India ethanol market size is projected to grow at a CAGR of 9.16% reaching a value of USD 4.15 billion by 2029. The rising demand for biofuels is expected to lead to growth in the India ethanol market. The country is gradually embracing the usage of ethanol-based fuels and electric cars, which will fuel market expansion in India. A major trend in the nation is the expansion of the agricultural sector and the use of feedstock for the production of ethanol. To increase output and support the schemes and plans that will lead to the expansion of the India ethanol market During the forecast period, the government is actively investing in the sector.

The automobile industry worldwide is swiftly moving towards an all-electric future, and just a few years ago, India proposed a 100% EV objective by 2030. Nevertheless, that has now been revised to a more realistic 2040. Surprisingly, despite the EV aim, ethanol flex-fuel cars are being seriously considered, and Indias minister for road transport and highways is actively lobbying for the cause. Ethanol -blended gasoline is not new to India; for over a decade, Petrol has been combined with ethanol, albeit at trace amounts of 2 3%. As modest quantities of ethanol - approximately 10% - have no negative impact on modern internal combustion engines (ICEs), ethanol blending was used to reduce Indias heavy burden due to humongous crude oil import bill. The doping threshold has risen to about 10% recently, with the government aiming to raise it to 20% by 2025.

According to projections of petrol use and a 20% ethanol mix, India will require 1,016 crore liters of ethanol by 2025, much less than Indias expected supply of 1,500 crore liters. The public sector oil marketing corporations under the administrative jurisdiction of the Ministry of Gas are also investing Rs. construction of 12 second refineries. Besides bagasse, left behind after juice made from agricultural wheat straw, maize cobs, and branches. As a result, the facilities are expected to using agricultural waste. Based on source, India ethanol Sugar & Molasses-based, Grain-Generation segments. In terms based segment dominates availability of corn and maize efficient technologies across encouraged the category ethanol is predominantly milling technique and 1 bushel

Petroleum and Natural 14,000 core in the generation (2G) bio-which is sugarcane waste extraction, 2G ethanol is leftovers, such as rice and even empty fruit proposed 2G ethanol enhance ethanol output

market is divided into based, and Second of volume, the grain-market. Ample and development of the nation have growth. Grain-based created via the dry of corn may produce 2.86 gallons of denatured ethanol. As producers address issues related to yields and demand saturation, corn production is expected to slow down globally. One of the main methods for producing ethanol nationwide is presently sugar mills. National acceptance of molasses-derived ethanol is growing, and developing nations are setting the pace. Based on purity, India ethanol market is split into Denatured and Un-denatured segments. The denatured ethanol segment is expected to be a faster-growing segment in terms of volume, owing to rising demand from the fuel and household chemicals industries. To achieve the desired properties, it can be combined with other chemicals. It is primarily used in cleaning and sanitizing formulations for indoor and outdoor environments. Denatured alcohol is derived primarily from natural sources such as corn starch and grains, making it suitable for household use. Other major growth drivers include increased awareness of indoor hygiene and the harmful effects of synthetic ingredients. Based on purity, India ethanol market is divided into Industrial Solvents, Fuel & Fuel Additives, Beverages, Disinfectant, Personal Care, and other segments. The fuel and fuel additives segment leads the India ethanol market by application. Rising demand for automotive fuel and changing regulations aimed at reducing air pollution is driving up demand for the product, which is used in the production of gasoline additives to improve fuel efficiency. As it is widely used in major end-use industries, industrial solvent is one of the steadily growing applications. Rising demand from the pharmaceutical and paints and coatings industries is expected to boost overall demand. The application segments future growth is heavily reliant on macroeconomic factors such as government policies and federal bank provisions. The National Policy on Biofuel (NPB) 2018 provides an indicative target of 20% ethanol blending in petrol by 2030.As a step in this direction, OMCs are to procure ethanol derived from C heavy molasses, B heavy molasses, sugarcane Juice, sugar, sugar syrup, damaged food grains unfit for human consumption, surplus food grains as decided by National Biofuel Coordination Committee (NBCC) under the ambit of NPB-2018, including fruit and vegetable wastes. Under the EBP Programme, OMCs procure and blend up to 10% ethanol in petrol. To summarize, annual ethanol procurement quantity (i.e. off take assurance) is worked out by the OMCs along with ethanol procurement price derived from damaged and surplus food grains (if applicable), whereas, ethanol procurement price derived from sugarcane based raw materials is fixed by the Government taking into account sugar sector scenario. Government directs OMCs to accord prioritization of raw material for ethanol procurement, guidance on transportation rate (which is fixed by OMCs), payment of GST and other administrative requirements to take forward the EBP Programme.

Ethanol is an agro-based product, mainly produced from a by-product of the sugar industry, namely molasses. In years of surplus production of sugarcane, when prices are depressed, the sugar industry is unable to make timely payment of cane price to farmers. The Ethanol Blending Programme (EBP) seeks to achieve blending of Ethanol with motor sprit with a view to reducing pollution, conserve foreign exchange and increase value addition in the sugar industry enabling them to clear cane price arrears of farmers. The Central Government has scaled up blending targets from 5% to 10% under the Ethanol Blending Programme (EBP). The procedure of procurement of ethanol under the EBP has been simplified to streamline the entire ethanol supply chain and remunerative ex-depot price of ethanol has been fixed.

To facilitate achieving of new blending targets, a "grid" which networks distilleries to OMC depots and details quantities to be supplied has been worked out. State-wise demand profile has also been projected, keeping in view distances, capacities and other sectoral demands. Excise duty has also been waived on ethanol supplies to OMCs for EBP by sugar mills during 2015-16 (up to 10 August, 2016). blending was only 38 crore litres, whereas in 2014-15, under the modified EBP supplies increased to 67 crore litres. In the ethanol season 2015-16, the ethanol supply has been historically high and has reached 111 crore litres achieving 4.2% of blending. In the ethanol season 2016-17, out of 80 Cr litre contracted about 66.51 Cr litre has been supplied. Further, in the ethanol season 2017-18, LOI has been issued for supply of 139.51 Cr litres of ethanol, out of which agreement have been signed for 136 Cr litres and about 46.25 Cr litre has been supplied so far. In addition, second round of tender has been opened by OMCs for bidding for procurement of 117 Cr litre of ethanol under EBP. The Central Government proposed a gradual rollout of ethanol-blended fuel to achieve E10 fuel supply by April 2022 and a phased rollout of E20 from April 2023 to April 2025. The government intends to achieve an ethanol blending target of 10% in the current ethanol supply year of 2021-22. In the ethanol supply year of 2020-21 (December-November), a record 3.03 billion litres of ethanol was supplied by distilleries to OMCs compared to 0.38 billion litres with blending levels of only 1.53% in 2013-14.

Roadmap for Ethanol Blending in India 2020-25

The NITI Aayog released a report on ‘Roadmap for Ethanol Blending in India 2020-25 in June 2021. The report suggests: (i) an annual roadmap for production and supply of ethanol till 2025-26, and (ii) systems for country wide marketing of ethanol. Note that the National Policy on Biofuels, 2018 was notified in June 2018, which aimed at achieving 20% blending of ethanol in petrol by 2030. In December 2020, the deadline to achieve the ethanol blending target was revised to 2025. Key observations and recommendations include:

Fuel ethanol demand projection: The report estimates that Indias requirement of ethanol for petrol blending will increase from 173 crore litres in 2019-20 to 1,016 crore litres in 2025-26. To meet this demand, the ethanol production capacity will have to be increased from 684 crore litres in 2019-20 to 1,500 crore litres in 2025-26. This includes production capacity of: (i) 740 crore litres of grain-based ethanol, and (ii) 760 crore sugar based ethanol. The report recommended that to enable roll out across India, ethanol may be supplied from surplus to deficit states based on the requirements. This will ensure uniform availability of ethanol blends in the country.

Ethanol blending roadmap: The report recommends that the Ministry of Petroleum and Natural Gas should notify a plan for availability of E10 fuel (blend of 10% ethanol and 90% petrol) by April 2022. Further, the Ministry should notify a plan for continued availability of the fuel for older vehicles. Fuel blended with 20% ethanol (E20) should be launched in phased manner from April 2023 to ensure availability of E20 by 2025. The roll out of higher ethanol blends may be done in phased manner, starting with the states with surplus production of ethanol.

Expediting regulatory clearances: Ethanol production plants need environmental clearances for new projects and expansion of existing projects. The report recommends certain measures to expedite regulatory clearances for ethanol production such as expediting the issuing of consent to establish distilleries by state governments. Further, a single window system may be formulated by the Department for Promotion of Industry and Internal Trade to accord speedy clearances. This would facilitate speedy clearances for new projects and expansion of current projects for ethanol production.

Ethanol pricing and environmental impact: In 2018-19, the government introduced a differential pricing policy wherein higher rates were offered to sugar mills for ethanol production from B-heavy molasses (an intermediate product) and sugarcane juice. This incentivizes sugarcane-based ethanol production. One litre of ethanol from sugar requires about 2,860 litres of water. In view of the need for water conservation, the report recommended that suitable incentives should be used to (i) source ethanol from less water intensive crops, and (ii) promote production from maize and second-generation sources.

Ethanol compatible vehicles: The Committee highlights that in order to use higher ethanol blends, vehicles need to be designed holistically to prevent engine failure and low fuel economy. Flex Fuel vehicles, though proven, would cost more than normal petrol vehicles. To ensure production of ethanol blended petrol compatible vehicles in the future, the Committee recommended that: (i) E20 material compliant and E10 engine tuned vehicles may be rolled out across the country from April 2023, and (ii) vehicles with E20 tuned engines can be rolled out from April 2025.

Unrestricted movement of denatured ethanol: The report noted that ethanol used for blending purpose is denatured ethanol (unfit for human consumption). It further noted that state governments are empowered to legislate, control, and levy taxes and duties on liquor meant for human consumption. The report recommended that movement of denatured ethanol across India should not be under control of states. It may be controlled only by the central government to ensure unrestricted movement across India. (Source: PRS legislative research report of NITI Aayog)

INDIAN CO-GENERATION SECTOR OVERVIEW

Biomass-based power generation emerged as a stable anchor as India surpassed 100 GW installed capacity and almost reached its NDC goal of 40% non-fossil installed capacity. The country achieved its 10 GW energy generation target from biomass, mainly on account of a substantial agro-waste availability round the year useful scalable technologies and easy integration into the mainstream. Over the last 10 years, biomass power generation achieved its annual target of new capacity addition on a number of occasions. The Central Government invested more than Rs. 4.6 billion in setting up biomass power and waste to energy systems in the previous decade. According to Ministry of New & Renewable Energy, non-signing of the power purchase agreements by DISCOMs (power distribution companies), lack of working capital and biomass non-availability remain key issues faced by the sector. A MNRE study indicated that biomass availability in India could reach a potential 28 GW and 14 GW power could be produced from bagasse-based cogeneration across the countrys 550 sugar mills. The biomass contribution could remain at 10 GW by 2030 on account of seasonal fuel availability. Central financial initiatives could encourage plants using biomass like bagasse, agro-based industrial residue, crop residue, wood produced through energy plantations, weeds, wood waste produced in industrial operations etc. (Source: Mongabay)

FINANCIAL ANALYSIS AND OPERATIONAL SNAPSHOT

FINANCIAL PERFORMANCE

(Rs. in Lakhs)

PARTICULARS	2022-23	2021-22
Revenue from Operations	1,62,748.23	1,40,029.15
Other Income	2340.29	406.20
Total Revenue	165088.52	140435.35
EBITDA	13672.65	18175.48
EBITDA/ Sales (%)	8.40%	12.98%
Profit before tax	8247.66	10901.92
Tax Expenses	1908.03	2380.42
Profit after tax	6339.63	8521.50

OPERATIONAL PERFORMANCE

Sugarcane and Sugar Beet crushed and sugar produced across all units (Financial Year 2022-23)

	Sugarcane		Sugar Beet
Particulars
	2022-23	2021-22	2022-23	2021-22
Crushing (lakh quintal)	227.51	226.61	37.12	35.04
Recovery % (Net)	9.30	8.39	8.34	8.70
Production (lakh quintal)	21.16	19.02	3.10	3.05

conditions were more or less similar to the previous year weather conditions. However, crushing of sugar beet increased by 6.79% over the previous year due to increase in area under cultivation of the crop. Net Recovery of sugar from sugarcane in case of UP units remained at same level as that of previous year. However, for Punjab Unit, the recovery of sugar from sugarcane is showing upward trend because the Company resorted to extraction of C Heavy Mollases (CHM) instead of B Heavy Mollasses (BHM) in the previous year. For Beetroot, the recovery of sugar from sugarcane, remain low due to climatic changes. Sugar production increased due to shifting of manufacturing of BHM to CHM in Punjab Units. In case of UP units, the production remained stable.

Performance of cogeneration division- Metrics of power sold:

	2022-23		2021-22
Unit
	Power sold (Lakh units)	Amount (Rs. /Lakh)	Power sold (Lakh units)	Amount (Rs. /Lakh)
Punjab	325.38	2325.11	522.88	3552.90
Uttar Pradesh	551.15	1926.36	451.73	1537.68
Total	974.61	4251.47	974.61	5090.58

The Power export in U.P. increased by 22% on account of better efficiency in sugar unit which consumed less power resulting into less requirement of power for captive use and leaving surplus for export to UPPCL. On the other hand, power export in Punjab reduced by 37.78% as the company decided to keep the surplus bagasse for its Beet manufacturing process for which the company earlier used to buy fuel from outside and decided not to buy this year on account of high prices.

Performance of Distillery:

Area of	Production* (Lakh BL)			Sales*(Lakh BL)	Revenue** (Rs. In Lakh)
Operation	2023	2022	2023	2022	2023	2022
Punjab	708.79	766.08	650.74	766.87	48111.88	45520.92
Uttar Pradesh	330.51	279.82	325.80	301.22	20994.57	16928.11
Total	1039.30	1045.90	976.57	1001.93	69106.48	64469.03

* Does not include products other than spirit/ Ethanol. ** Including Sale of all products

The production of Ethanol in Punjab reduced by 7.47%. Against this the production of Ethanol in U.P. increased by 18.12%. The production decreased due to scheduled maintenance of the plant while in U. P. the plant operated for more days than in previous year at optimum capacity leading to rise in production. Overall performance further improved due to better price realization in the segment.

Accounting policies

The financial statements of the Company have been prepared in compliance with the requirements Section 129 of the Companies Act, 2013 read with the Indian Accounting Standards (IND-AS) issued by the Ministry of Corporate Affairs. The accounting policies followed by the Company form an integral part of the annual report.

Business Segment Review

SUGAR OVERVIEW

Rana Sugars Limited has 3 manufacturing facilities with an aggregate cane crushing capacity of 20,500 tonnes per day. The group has geographically diverse sugar manufacturing facilities with one unit each in Moradabad & Rampur districts of Uttar Pradesh and one unit in Amritsar district of Punjab. The sugar units of the Company are FSSAI certified and supplies good quality crystal sugar to a diverse customer base.

Over the years, Rana Sugars Limited has invested in various initiatives to improve cane yield, enhance recovery and optimise costs. These initiatives comprise of tight cane inventory management, engagement with farmers through seminars and the increased use of technology in cane supply chain. The initiatives have played a large role in improving process transparency.

The Company pioneered manufacturing of sugar from sugar beet in India. It has set up Indias first sugar beet processing facility at the Amritsar facility. Over the years, the Company has been making efforts to increase area under sugar beet by educating farmers and assuring them of offtake of the crop with enhanced revenue over other crops.

1107.16	1189.54
Revenues earned during	Revenues earned during
2021-22 (Rs. crore)	2022-23 (Rs. crore)
70.42	32.58
EBITDA earned during	EBITDA earned during
2021-22 (Rs. crore)	2022-23 (Rs. crore)
22.12	21.16
Total production during	Total production during
2021-22 (lakh quintals)	2022-23 (lakh quintals)
8.39	9.30
Recovery rate during	Recovery rate during
2021-22 (%)	2022-23 (%)
56.89	56.10
Contribution to total revenues	Contribution to total
during 2021-22 (%)	revenues during
	2022-23 (%)
20500 (Sugar)	20500 (Sugar)
5000 (Sugar Beet)	5000 (Sugar Beet)
Crushing Capacity during	Crushing Capacity during
2021-22 (TCD)	2022-23 (TCD)

The recovery during the year was ratheerish as compared to PY though. Across U.P., there has been a decrease in sugarcane yields and sugar recovery, largely attributable to climatic factors/ unseasonal high rains, flooding in certain areas, and high ambient temperatures & heat wave, which impacted the recoveries. In some regions, the crop has been infested with red rot (in some units), top and root borers. This resulted in lower sugarcane yields and availability. Despite such challenges, the Company managed to perform well in SS 2022-23, with its reduction in crush and recovery lower than the average for the State. The Company strives to achieve its manufacturing facilities optimally to achieve tandem in Cost & economy which paves the way for better margins. Over the years, Companys focused sugarcane development programme, with almost 100% high-yielding and high-sugared variety sugarcane, has helped the farmers achieve higher returns as a result of enhanced farm productivity. Due to this the Company yet again achieved highest ever Sugar Beet crushing of 37.12 Lakh Qtls (PY 35.04 Lakh Qtls) with total Sugar Beet and cane crushing of 227.51 Lakhs Qtls in the FY 2022-23.

Challenges and responses

Excessive dependence on single variety. The company and the industry needs to reduce its dependence on CO 0238 variety. In case of failure of the variety for any reason, large scale substitution with another variety will be a challenge. Your company is trying to propagate other early varieties to mitigate this challenge. Above variety is also prone to attack of red-rot pest. Your company is taking all precautionary measures and educating farmers on dealing with this disease. Your company is also introducing CO 118 variety as a substitute to CO 0238 variety. Recovery of the company is closer to the saturation level. Company is not only enhancing plant efficiencies but also working on incubation & development of other high recovery yielding varieties.

Future Roadmap

Governments positive interventions in propelling the sugar sector bode well for the Company. The company will engage deeper with farmers, operate plants at optimal capacity and strengthen its financial performance. The company will also introduce high sugar yielding varieties released by various sugarcane breeding institutes in the country. With increased focus on ethanol, contribution from sugar segment will moderate in the times to come. This will help the company beat the cyclical nature of business that the sugar industry has traditionally been associated with.

DISTILLERY OVERVIEW

Rana Sugars Limited has total distillation capacity of 325 KLPD as at end of FY 22-23 against the capacity of 305 KLPD last year. During the year, your company modified the plant to achieve better efficiency and balanced the same at 100 KLPD. The company uses B heavy molasses to produce ethanol that allows the company to further reduce its dependence on crystal sugar. The Company has installed best-in-class equipments to take this business ahead. Our pullulating growth in the Alcohol business is powered by our focus on being an active partner in Indias self-reliance journey, and is driven by our passion for premium quality production at all our manufacturing facilities. The distillery plant at Punjab also has the flexibility to also produce Extra Neutral Alcohol (ENA). The distillery at Punjab is capable of being operated on molasses/ sugarcane juice/ syrup and grains.

628.24	700.87
Revenues earned during	Revenues earned during
2021-22 (Rs. crore)	2022-23 (Rs. crore)
81.95	79.27
EBITDA earned during	EBITDA earned during 2022-23
2021-22 (Rs. crore)	(Rs. crore)
1,068.09	1019.42
Industrial alcohol sold during	Industrial alcohol sold during
2021- 22 (lakh Bulk litres)	2022-23 (lakh Bulk litres)
32.28	33.05
Contribution to total revenues	Contribution to total revenues
during 2021-22 (%)	during 2022-23 (%)

As an environmentally conscious and responsible corporate, we follow the highest standards in Environment, Health and Safety (EHS), with stringent compliance to environmental and pollution norms. We have set up concentrated spent wash

(termed as SLOP) fired incineration boilers at both the distilleries, as per the Indian Governments directives and guidelines for effluent treatment.

POWER SEGMENT OVERVIEW

During the year for its Punjab Unit, Company decided to operate moderately to save on the fuel for crushing beet root on account of rising fuel prices of the category. In case of U.P. units the Company decided to sell the bagasse rather than using the same for power generation as the prices of the bagasse firmed up and there was no feasibility in exporting power at the prevailing prices, though during the crushing season the Company exported the surplus power after meeting captive requirement. However, the capacity utilization was less than the earlier years.

210.88	230.02
Revenues earned during	Revenues earned during
2021-22 (Rs. crore)	2022-23 (Rs. crore)
27.81	24.86
EBITDA earned during	EBITDA earned during
2021-22 (Rs. crore)	2022-23 (Rs. crore)
2,153.30	2,062.00
Total production during	Total production during
2021-22 (lakh units)	2022-23 (lakh units)
10.83	10.85
Contribution to total revenues	Contribution to total revenues during
during 2021-22 (%)	2022-23 (%)

OUR BUSINESS DIVISIONS AND RISK PROBABILITY

DIVISIONS	RISK PROBABILITIES	REASONS
Sugar	High-moderate	Competitive and Regulated market
Distillery	Moderate-low	Government Support and Subsidies
Power	High-moderate	Regulated market & Sole buyer addressed

Our Enterprise Risk Management (ERM) function enables the achievement of the Companys strategic objectives by identifying, analyzing, assessing, mitigating, monitoring and governing any risk or potential threat to these objectives. While this is the key driver, our values, culture and commitment to stakeholders employees, customers, investors, regulatory bodies, partners and the community around us are the foundation for our ERM framework. The Company is engaged in multiple businesses and there are unique risks associated with each business. The Company follows a well-structured Enterprise Risk Management (ERM) Policy, which requires the organization to identify the risks associated with each business and to categorize them based on their impact and probability of occurrence at the business level and at the entity level. Mitigation plans are laid out for each risk along with designation of an owner thereof. It is the endeavour of the Company to continually improve its systems, processes and controls to improve the overall risk profile of the Company. The systematic and proactive identification of risks, and mitigation thereof, enables our organization to boost performance with effective and timely decision-making. Strategic decisions are taken after careful consideration of primary risks, secondary risks, consequential risks and residual risks. The ERM function also enables effective resource allocation through structured qualitative and quantitative risk impact assessment and prioritization based on our risk appetite. Our ERM framework also enables the identification of underlying opportunities during risk assessment, which are then further evaluated and actionized by the business. Our ERM framework encompasses all of the Companys risks, such as strategic, operational, and legal & compliance risks. Any of these categories can have internal or external dimensions. Hence, appropriate risk indicators are used to identify these risks proactively. We take cognizance of risks faced by our key stakeholders Since the Company is engaged in diversified businesses having completely different risk profiles, Risk Management Framework for each business has been devised considering its complexity and uniqueness. Sugar business (including distillery) of the Company is agro-based and largely dependent on uncontrollable climatic factors and Government regulations and policies, whereas the Power Segment is dependent on the economic growth of the country. The Distillery business is comparatively less regulated as compared to the other two business segments of the Company however, it faces other challenges.

Risk of Business Disruption due to COVID-19

It remained by and large controlled despite some disruption to the business activities of Water and Power Transmission businesses for a brief period. Presently, the normalcy has been largely restored, including floating of tenders for new projects and finalization of the earlier tenders.

TYPE OF RISKS INVOLVED

Regulated Market: Sugarcane pricing, export policy, monthly sales quota, Ethanol Pricing, State Liquor Prices are all regulated by the Government and are outside the control of the Company which makes the Sugar Business vulnerable to external factors.

Mitigation: These risks are external to the Company and uncontrollable, hence may impact the profitability. The Government has been taking rational policy decisions balancing the interests of all the stakeholders, which has substantially helped the sugar industry. The government is expected to increase MSP of Sugar as well as prices of Ethanol due to corresponding rise in the prices of the cane to mitigate the impact of increase in Sugarcane prices on Sugar Industry. Further, the Company always stresses on improvement of recoveries as these lead to low cost of production of sugar and enables the sugar mills to beat market variation in sugar prices and make the sugar operation viable. The recoveries of our Company have consistently been improving over the last few years.

Climate/ Crop Disease: Monsoon, flood, drought and crop diseases impact the yield and sugar recovery from cane.

Mitigation: The impact of climatic factors is moderate in Uttar Pradesh, though during last year due to disease the yield was affected. However, the cane staff of the Company pro-actively monitors the growth of sugarcane and disease infestation, so that timely action could be taken to avoid or minimize the damage. Further, the Company is focusing on better yield variety to overcome this risk.

Farmer relationships risk: Disturbed relationships with farmers could affect procurement quantum and quality. Mitigation: The Company remunerates farmers fairly and timely. The Company undertakes proactive measures to educate farmers and provides seeds and insecticides at subsidized rates, laying the foundation for enduring farmer relationships.

Demand-supply risk: Rising sugar inventories could threaten sugar prices and affect realizations.

Mitigation: Rana sugars focus lies in servicing customers with superior quality lab-tested sugar. Owing to a consistent product quality and superior inventory management, the Company reported consistent demand through the year. Further GOI policy initiative to allow usage of syrup & B-HM for manufacturing of Ethanol and export policy of the Government has helped in stabilizing the surplus inventory levels.

Working capital risk: In an industry marked by high inventory, optimal capital availability is necessary.

Mitigation: Rana sugar operates in a volatile sugar segment, complemented by ethanol and cogeneration divisions. Quota regulated sales and rising cane prices leads to enhanced WC requirements. Adequate working capital is required to make timely cane price payment and to maintain inventories. Further, it is imperative to keep cost of funds in check to rationalise finance costs. The ethanol and co-generation segments help the Company manage liquidity to certain extent.

Internal control systems and their adequacy

The Company is responsible for the identification of material sustainability topics, establishing and maintaining appropriate performance management and internal control systems, and derivation of performance data reported. The Company possesses a robust internal control system to review performance, track operations and gauge liquidity.

Human Resource Management

The Rana Sugars Limited comprises 1,139 full-time permanent employees and their dependents besides seasonal employees. Our professionals are our most important assets. We are committed to hiring and retaining the best talent. For this, we focus on promoting a collaborative, transparent and participative organization culture, and rewarding merit and sustained high performance. Our human resource management focuses on allowing our employees to develop their skills, grow in their career and navigate their next. The Human resource department of the Company focuses on establishing healthy linkages to continuous improvement in productivity, quality, cost competitiveness and efficiency. They also carry out continuous improvements in all areas of work to increase competitiveness and retain customer focus. Empowering and motivating the employees to do their best through decentralised operations, providing opportunities of employment for all irrespective of caste, religion, region or any other criteria, Rewards and recognition based on meritocracy and achievement of pre-stated targets are a continuous process in the Organization.

DETAILS OF CHANGES IN KEY FINANCIAL RATIOS

PARTICULARS	2023	2022	CHANGE
Debtors turnover ratio	13.83	11.29	22.57%
Inventory turnover ratio	2.96	3.16	-6.20%
Interest coverage ratio	5.97	6.30	-5.23%
Current ratio	1.11	1.10	0.23%
Debt equity ratio	0.24	0.26	-7.82%
Operating Profit Margin (%)*	8.40	12.98	-35.28%
Net profit margin (%)*	3.90	6.09	-35.96%
Return on Net worth (%)*	13.19	20.99	-37.16%

* The profit margin/ returns has declined during the previous year on account of rising input cost throughout the segment.

CAUTIONARY STATEMENT

The statements in the management discussion and analysis section with regard to projections, estimates and expectations have been made in good faith. The achievement of results is subject to risks, uncertainties and even less than accurate assumptions. Market data and information are gathered from various published and unpublished reports. Their accuracy, reliability and completeness cannot be assured.

			On behalf of the Board of Directors
			For RANA SUGARS LIMITED
Date	: 11th August, 2023	RANA INDER PRATAP SINGH	RANA VEER PRATAP SINGH
Place	: Chandigarh	Managing Director	Director
		DIN: 00075107	DIN: 00076808