Your directors have pleasure in presenting the management discussion and analysis report for the year ended on March 31, 2025.
ECONOMIC OVERVIEW
Global Economy
The International Monetary Fund (IMF), in its April 2025 World Economic Outlook, predicted that the global growth is projected to decline after a period of steady but underwhelming performance, amid policy shifts and new uncertainties. Global headline inflation is expected to decline further, notwithstanding upward revisions in some countries. Risks to outlook are tilted to the downside. Escalating trade tensions and elevated policy-included uncertainty may further hinder world growth. Shifting policies could lead to abrupt tightening of global financial conditions and capital outflows, particularly impacting emerging markets. Demographic shifts threaten fiscal sustainability, while the recent cost of living crisis may reignite social unrest.
As per the prediction of IMF, in the near term, global growth is projected to fall from an estimated 3.3 percent in 2024 to 2.8 percent in 2025, before recovering to 3 percent in 2026. This is lower than the projections in the January 2025 WEO Update, by 0.5 percentage point for 2025 and 0.3 percentage point for 2026, with downward revisions for nearly all countries. The downgrades are broad-based across countries and reflect in large part the direct effects of the new trade measures and their indirect effects through trade linkage spill overs, heightened uncertainty, and deteriorating sentiment. IMF further indicated that the growth impact of tariffs in the short term varies across countries, depending on trade relationships, industry compositions, policy responses, and opportunities for trade diversification.
Real GDP, Y-O-Y% Change
| Particulars | Actual 2024 | Estimate 2025 | Projection 2026 |
| World Output | 3.3 | 2.8 | 3.0 |
| Advanced Economies | 1.8 | 1.1 | 1.5 |
| United States of America (US) | 2.8 | 1.8 | 1.7 |
| United Kingdom (UK) Emerging Market & | 1.1 | 1.1 | 1.4 |
| Developing Economies | 4.3 | 3.7 | 3.9 |
| Emerging and Developing Asia | 5.3 | 4.5 | 4.6 |
| India | 6.5 | 6.2 | 6.3 |
| China | 5.0 | 4.0 | 4.0 |
| Emerging and Developing Europe | 3.4 | 2.1 | 2.1 |
| Sub Saharan Africa | 4.0 | 3.8 | 4.2 |
| Middle East and Central Asia | 2.4 | 3.0 | 3.5 |
Source: IMF World Economic Outlook, April 2025. Year is a calendar year except for India, which is presented on fiscal year basis with FY 2023-24 shown in the 2024 column
Among the advanced economies, the US grew by 2.8% in 2024, and is projected to grow by 2.8% in 2025 and at a pace of 3.0% in 2026. Growth in the UK is estimated to remain largely flat in 2024 and 2025, and thereafter increase to 1.4% in 2026. The slower pace of growth in the UK is due to the impact of high energy prices and related inflation, which is expected to ease towards. Chinas growth is projected to slow from 5.0% in 2024 to 4.0% in 2025 and 2026, mainly due to rising trade tensions and new tariffs over the past year apart from prolonged weaknesses in real estate sector. Indias growth rate on the contrary is estimated at 6.2% in 2025 and estimated at 6.3% in 2026, supported by strong domestic demand and a rising working-age population.
Source: IMF - World Economic Outlook, April 2025.
Indian Economy
Growth
The provisional estimates released by the National Statistical Office (NSO) placed Indias real GDP growth in 2024-25 at 6.5 per cent.3 During 2025-26 so far, domestic economic activity has exhibited resilience. Agriculture sector remains strong. With a very good harvest in both the kharif as well as rabi cropping seasons, the supply of major food crops is comfortable. The reservoir levels remain healthy. The highest procurement of wheat in the last four years provides a comforting stock position. Industrial activity is gaining gradually, even though the pace of recovery is uneven. Services sector is expected to maintain momentum. PMI services stood strong at 58.8 in May 2025, indicating robust expansion in activity.
On the demand side, private consumption, the mainstay of aggregate demand, remains healthy, with a gradual rise in discretionary spending. Rural demand remains steady, while urban demand is improving. Investment activity is reviving as reflected by high-frequency indicators. Merchandise exports recorded a strong growth in April 2025 after a lacklustre performance in the recent past. Non-oil, non-gold imports posted a double-digit growth, reflecting buoyant domestic demand conditions. Services exports continue on a strong growth trajectory.
Going forward, the outlook for agriculture sector and rural demand is expected to receive further impetus by the expected above normal southwest monsoon rainfall. On the other hand, sustained buoyancy in services activity should nurture revival in urban consumption. The healthy balance sheets of banks and corporates; governments continued thrust on capex; elevated capacity utilisation, improving business optimism and easing of financial conditions should help further revive investment activity. Trade policy uncertainty however continues to weigh on merchandise exports prospects, while conclusion of free trade agreement (FTA) with the United Kingdom22 and progress with other countries should provide a fillip to trade in goods and services. Spill overs emanating from protracted geopolitical tensions, and global trade and weather-related uncertainties pose downside risks to growth. Taking all these factors into consideration, real GDP growth for 2025-26 is projected at 6.5 per cent with Q1 at 6.5, Q2 at 6.7, Q3 at 6.6 and Q4 at 6.3 per cent. The risks are evenly balanced.
Inflation
CPI headline inflation continued its declining trajectory in March-April, with headline CPI inflation moderating to a nearly six-year low of 3.2 per cent (y-o-y) in April 2025. This was led mainly by food inflation, which recorded the sixth consecutive monthly decline. Fuel group witnessed a reversal of deflationary conditions and recorded positive inflation prints during March and April, partly reflecting the hike in LPG prices. Core inflation remained largely steady and contained during March-April, despite increase in gold prices exerting upward pressure.
The outlook for inflation points towards benign prices across major constituents. The record wheat production and higher production of key pulses in the Rabi crop season should ensure adequate supply of key food items. Going forward, the likely above normal monsoon along with its early onset augurs well for Kharif crop prospects. Reflecting this, inflation expectations are showing a moderating trend, more so for the rural households. Most projections point towards continued moderation in the prices of key commodities, including crude oil. Notwithstanding these favourable prognoses, we need to remain watchful of weather-related uncertainties and still evolving tariff related concerns with their attendant impact on global commodity prices. Taking all these factors into consideration, and assuming a normal monsoon, CPI inflation for the financial year 2025-26 is now projected at 3.7 per cent, with Q1 at 2.9 per cent; Q2 at 3.4 per cent; Q3 at 3.9 per cent; and Q4 at 4.4 per cent. The risks are evenly balanced.
External Sector
With the moderation in trade deficit in Q4:2024-25, alongside strong services exports and remittance receipts, the current account deficit (CAD) for 2024-25 is expected to remain low. Furthermore, despite rising geopolitical uncertainties and trade tensions, Indias merchandise trade remained robust in April 2025. As imports grew faster than exports, trade deficit however widened during the month. Going forward, net services and remittance receipts are likely to remain in surplus, counterbalancing the rise in trade deficit. The CAD for 2025-26 is expected to remain well within the sustainable level.
On both inflation and growth fronts, the Indian economy is progressing well and broadly on expected lines. Strong macroeconomic fundamentals and benign inflation outlook provide space to monetary policy to support growth, while remaining consistent with the goal of price stability. As global environment remains uncertain, it has become even more important to focus on domestic growth amidst sustained price stability. Accordingly, todays monetary policy actions should be seen as a step towards propelling growth to a higher aspirational trajectory.
(Source: RBI Monetary policy statement, June 6, 2025).
INDUSTRY OVERVIEW
Corn Wet Milling Industry - Global
The global corn wet milling market is projected to grow to $117.17 billion by 2031, with a CAGR of 4.43%. Key players in the market include ADM, Cargill, and Tate & Lyle. The market is driven by increasing demand for starch and other corn based sweeteners in various industries such as food and beverages, pharmaceuticals, and textiles. In the Asia Pacific region, the starch market actively experiencing robust growth owing to the increasing population and rising disposable income. The region is witnessing a shift in consumer preferences towards natural and organic products, which is driving the demand for starch. Manufacturers in the region are focusing on expanding their production capacities to meet the growing demand. The starch market in Asia Pacific is also benefiting from the growing food and beverage industry in countries such as China and India.
Market Growth and Trends:
CAGR:
The market is expected to grow at a Compound Annual Growth Rate (CAGR) of 4.43% between 2024 and 2031. (According to Data Bridge Market Research)
Market Value:
The global corn wet milling market was valued at $82.83 billion in 2023 and is projected to reach $117.17 billion by 2031.
Key Drivers:
Increasing demand for starches and corn-based sweeteners:
The growing awareness of the health benefits associated with starch consumption is driving significant changes in the food industry. Starch, known for its versatile applications in food products, is increasingly recognized for its role in providing energy, promoting digestive health, and aiding in weight management. As consumers become more health-conscious, there is a rising demand for products with natural and functional ingredients like starch. This trend has led to a surge in sales volume for starch-based products, boosting the profit margins of companies operating in this sector. Food manufacturers are now focusing on developing innovative products that cater to this demand, further driving the growth of the starch market.
Growing consumption of gluten-based feed:
Corn gluten meal and gluten feed are important animal feed ingredients.
Technological Advancements:
R&D is leading to more efficient milling processes and increased use of corn-based ingredients in various applications.
Sustainability:
Theres a growing trend towards developing greener milling processes to reduce the environmental impact.
The starch industry faces challenges owing to limited raw material availability and environmental concerns. Variations in crop yields can impact the availability of raw materials, leading to supply chain disruptions and increased production costs.
The starch market is expected to be shaped by food brands and brands, with starch being used in various food products such as breads, soups, puddings, pies, meat products, and sauces. The demand for starch is increasing due to changing consumer preferences from fresh roots to processed, value-added food products. The bakery industry is emerging in the market, with developing African countries experiencing significant penetration for baked food products. Starch manufacturers are targeting bakery and convenience food manufacturers to gain market share. Non-food applications of starch include adhesive, paper, and pharmaceuticals.
Starch Industry - India
The Indian corn starch market has experienced significant growth, driven by its diverse applications across various industries. Corn starch, a versatile carbohydrate extracted from the endosperm of corn, is widely utilized in food and beverages, textiles, pharmaceuticals, and paper and packaging industries. In the food sector, it serves as a thickening agent, stabilizer, and ingredient in confectionery products. The growing demand for processed and convenience foods has further fuelled its consumption.
In the textile industry, corn starch is used in fabric finishing and as a sizing agent, enhancing fabric strength and quality. The pharmaceutical industry leverages corn starch as a disintegrant in tablet formulation, ensuring proper dissolution and bioavailability of medications. Additionally, its role in biodegradable packaging solutions aligns with the increasing emphasis on sustainable practices.
Native Corn Starch type accounted for the largest share in 2023 and is estimated to reach $1,741.2 million by 2030. In the Indian corn starch market, native corn starch holds a dominant position, commanding the largest market share. This prominence is attributed to its extensive utilization across various industries due to its natural properties and cost-effectiveness. Native corn starch is favoured in the food and beverage sector as a thickening and stabilizing agent, enhancing the texture and consistency of products. Its applications extend to the textile industry for fabric sizing and finishing, and to the paper industry as a surface coating and adhesive component. The pharmaceutical sector also relies on native corn starch as an excipient in tablet formulations. The versatility, affordability, and wide availability of native corn starch underpin its leading market share in Indias corn starch market.
Pharmaceuticals segment is analysed to grow with the highest CAGR 6.9% in the India Corn Starch Market during the forecast period 2024-2030. Corn starch is essential in pharmaceutical formulations, acting as a disintegrant, binder, and filler in tablet production. Its role in ensuring proper tablet dissolution and bioavailability is critical for effective medication delivery. The growth is propelled by rising healthcare awareness, expanding pharmaceutical manufacturing capabilities, and increased investment in research and development. Additionally, the trend towards more natural and cost-effective excipients further boosts the demand for corn starch in the pharmaceutical industry, solidifying its rapid market expansion.
One of the major drivers of the India corn starch market is the burgeoning food and beverage industry. With an increasing urban population, rising disposable incomes, and changing consumer lifestyles, there is a heightened demand for processed and convenience foods. According to India Brand Equity Foundation, Indias food processing business is one of the worlds largest, with revenues estimated to reach $535 billion by 2025-26. Corn starch, used extensively as a thickener, stabilizer, and emulsifier, is integral in the production of sauces, soups, bakery items, and confectionery products. Its ability to enhance texture, improve shelf life, and maintain consistency makes it indispensable for food manufacturers. Moreover, the trend towards ready-to-eat meals and the expansion of the fast-food sector further amplifies its demand, positioning the food and beverage industry as a key growth catalyst for the corn starch market in India.
A major challenge facing the India corn starch market is the fluctuation in raw material prices. Corn, the primary raw material for corn starch production, is subject to price volatility due to factors such as seasonal variations, weather conditions, and geopolitical events. For instance, adverse weather can significantly reduce crop yields, driving up prices. The Indian starch market is also impacted by geopolitical disruptions and global realignments. In starches India is impacted by overcapacities. Additionally pre-covid, China was impacted and it stopped exports. However, China has started exporting to the world and India is facing stiff competition to sell at a higher rate due to high prices of maize which is prevailing in India. This has forced the manufacturers to dump the goods in India at a lower price which has affected the margins of manufacturers of starches in India. Additionally, global market trends and demand-supply dynamics influence raw material prices. Maize, which has diverse applications beyond starch production, such as animal feed and biofuel, further intensifying competition and price instability. These fluctuations create challenges for starch manufacturers in forecasting costs, managing inventory, and setting competitive prices, ultimately impacting profitability and hindering market growth.
Growth Drivers
Outlook for Maize:
The situation in Ukraine had significantly impacted its export capabilities due to ongoing conflict, leading to a notable decrease in the volume of corn it exports. However, export from Ukraine to India is rising doe to production of Non-GM corn.
Recently, China has emerged as a major importer of corn, driven by a surge in its demand. This increased demand is partly a response to reduced domestic maize production within China. As a result, China is procuring large quantities of corn from Brazil, which has become a primary supplier due to the challenges faced by other exporting nations.
There has been a surge in demand for corn due to increased use in manufacture of ethanol. This has created challenges for corn wet milling industries as it has increased price of corn during the year under review. During the current year, more than normal rains are predicted as a result of which there would be increase in the maize output which may in turn reduce the price of maize and have a positive impact on the margins of starch manufacturers.
Increased demand for sweetener side:
The demand for sweeteners has seen a notable increase, driven by the growing need for alternatives in various products such as cold drinks, medicines, and other food items. Both sugarcane and corn are viable sources for these sweeteners and flavorings.
However, a significant shift is occurring in the sugarcane industry. Increasingly, sugarcane is being redirected towards the production of ethanol, a renewable fuel. This shift is due to the rising global emphasis on sustainable energy sources and the growing market for biofuels.
As a result of this diversion of sugarcane towards ethanol production, the availability of sugarcane for sweeteners is diminished. This reduction in supply is creating an opportunity for corn to step in as a key player in the sweetener market. With sugarcanes role in producing ethanol expanding, corn is becoming a more prominent and attractive option for meeting the rising demand for sweeteners in consumer industries.
High entry barriers for the new comers in the industry:
Additionally there are high entry barriers in corn processing industry due to quality standards for end-use industries such as pharma and FMCG which means trust factor and track record of a supplier is of utmost important and for the new players, given the critical end-use, the approval process of these products takes a substantially long period and established players in the industry has advantage and this also acts as entry barrier for the new comers.
Government Support:
The support of Government through fixing of MSP for maize continues and
Product Portfolio
increased use of maize to produce ethanol. In addition to above, with increased price of maize after Russia - Ukraine war many growers may opt for the crop this year.
COMPANY OVERVIEW
Sayaji Industries, the flagship company of the Sayaji Group is one of the leading manufacturers of maize starch and its derivatives. Established in 1941, the Company was initially set up as a corn wet milling unit with modest corn crushing capacity of one ton/ day in Ahmedabad, primarily to serve the citys textile units. Within a span of over eight decades, the Company is amongst the largest corn refiners in India. With an annual capacity of 1000 Metric Tonnes Per Day (MTPD), the Company among the foremost corn starch producers in the country. It is also proposed to gradually increase the maize grinding capacity in future with modernization of equipment which in turn is expected to improve the top and bottom lines of the company.
Supported by its state-of-the-art manufacturing facilities and cutting-edge R&D prowess, the Company delivers quality modified starches and other derivatives to a wide range of industries, including textiles, paper, pharmaceutical, food processing, consumer products, animal nutrition, among others. Globally, the Company has a market in more than 40 countries and is one of the big exporters in Indias starch industry. Its commendable export work has been credited with the Export House Status by the government of India. Besides, the Company has a strong distribution network in India, with branches and agents to fulfil the requirements of its extensive customer base.
| Products Covered | Industries Served |
| Starch | Paper, food products (soups, ketchup, jellies, custard powders, mayonnaises, salad dressing), gypsum board, pharmaceutical formulations |
| Liquid Glucose | Used in food products like jams, jellies, chewing gums, canned fruits to prevent spoilage |
| Fabrilose | Textile sizing - to provide elasticity to yarn, gypsum board |
| Dextrose Anhydrous | Used in special food preparations and is the best sweetener for water sensitive systems such as chocolate. Also used in medical critical conditions like comas and operations |
| Dextrose Monohydrate | Used in quality yeast for bakery, confectionary, dairy products, carbonated beverages, formulations with vitamins and minerals |
| Sorbitol | For use in mints, cough syrups, tooth paste, cigarettes and baked food items to maintain freshness, softness and flexibility |
| By Products | For use in food products, cattle feed and poultry farming |
REVIEW OF FINANCIAL & OPERATIONAL PERFORMANCE
The total income of the company is Rs 99,448.67 lakhs as against Rs 94,386.18 lakhs in the previous year which indicates an increase of 5.40%. The price of maize during the year under review remained high. There has also been an increase in the cost of some other inputs. Due to increased competition in the domestic and international markets, the company could pass on only some portion of such increased cost to its customers. As a result of this the bottom-line of the company remained impacted. The liquidity position remained adequate to service all interest and debt repayments.
The EBITDA of the company during the year under review 2320.71 to Rs 1057.03 lakhs as against
(1057.53) lakhs in the previous year. The gross profit of the company increased to Rs 506.38 lakhs as against
Rs 277.45 lakhs in the previous year. The profit before tax of the company stood at (1,383.16) lakhs as against (1863.03) lakhs in the previous year and profit after tax declined to (1146.52) lakhs as against
(1,131.89) lakhs in the previous year.
SEGMENT OVERVIEW
Maize Processing
Maize Processing segment is the main source of revenue and profitability of the company. The key numbers of the maize processing segments are as given below :
| Particulars | 2024-25 | 2023-24 |
| Maize Grinding | 2,74,740 MTs | 2,91,672 MTs |
| Revenue from operations | 92,802.40 | 91,965.11 |
| Export Turnover | 14,373.20 | 12,972.80 |
| EBITDA | 2,320.71 | (1,057.03) |
| Profit Before Tax | (1,383.16) | (1,863.03) |
| Profit After Tax | (1,145.52) | (1,131.89) |
There has been an increase in the maize grinding during the year under review. The bottom line remained affected due to very high maize and coal prices during the year under review as compared to last year which could not be passed on to the consumers fully.
Agri Seeds Segment
| Particulars | 2024-25 | 2023-24 |
| Revenue from operations | 4,638.41 | 3,888.12 |
| Profit Before Tax | 152.79 | 197.65 |
Spray Dried Food Products Segment
| Particulars | 2024-25 | 2023-24 |
| Revenue from operations | 3,103.44 | 1,799.19 |
| Profit Before Tax | 370.55 | (66.57) |
There has been a noticeable increase in overall turnover. However, its worth highlighting that within the Spray Dried Food Products segment, effective management strategies have significantly mitigated losses. Thanks to these targeted efforts, the reduction in losses has been substantial, reflecting a marked improvement in this particular segments performance.
Key Financial Ratios based on standalone financial statement
RISKS AND THREATS
Competition Risk
The corn starch industry has been witnessing increased capacity expansion by existing players, entry of new players and growing availability of substitute materials. Due to abrupt increase in maize prices in the domestic market, the company is facing pricing pressure in the international Market (where the prices of maize have remained steady). This, in turn, may impact export market share of the company.
Mitigation
Over the years, the company has cemented its reputation as a leading manufacturer and supplier of high-quality corn starch products at right prices to diverse industries. Further, its consistent focus on capacity expansion for production of high-margin products and cost optimization are likely to drive the overall profitability and sustain the market position.
Raw Material Risk
Maize, as an agricultural product, is highly vulnerable to the impacts of climate change. Extreme weather events such as droughts, floods, and heatwaves can disrupt corn production, leading to shortages in supply and increased production costs. Additionally, changing precipitation patterns and water stress can further exacerbate the challenges faced by the industry. The increased occurrence of pests and diseases associated with climate change also poses a threat to maize crops. Moreover, regulatory changes aimed at mitigating climate change effects can impact the production practices and costs within the industry. These climate-related factors may result in high production costs, under-utilization of capacities, and market volatility.
Furthermore, climate change influences the cost of power, a major input for starch manufacturing. Increased energy costs driven by renewable energy transitions or resource scarcity may further impact the margins and profitability of companies in the industry. To mitigate the impacts of climate change, implementing sustainable agricultural practices such as improving irrigation efficiency, developing drought-resistant maize varieties, and promoting integrated pest management becomes crucial.
The company is also importing maize from countries producing Non GM maize to ensure availability of maize at a reduced cost.
Mitigation
The Company has established an effective maize procurement policy to ensure a continuous supply of quality corn while reducing the risks associated with climate-related production shortages. The strategic location of its storing facilities near manufacturing plants minimizes transportation emissions. The companys power generation turbine and biogas engine utilize methane gas from effluent treatment for low-cost energy production. The company is installing solar power plant of the capacity of 6.6 MWs which in turn is expected to reduce the power costs of the company. These actions demonstrate the companys commitment to reducing its carbon footprint and promoting a sustainable future.
Environmental Risk
In addition to the risks associated with maize supply, the company also faces environmental risks such as increasing regulation and changing government policies related to sustainability and climate change. Indias Nationally Determined Contributions (NDCs) have set targets for reducing greenhouse gas emissions, increasing renewable energy use, and improving energy efficiency. Failure to comply with these regulations could result in fines, legal action, and damage to the companys reputation.
Mitigation
To mitigate these risks, Sayaji Industries Ltd. - Maize Products has implemented several initiatives aimed at reducing its environmental impact and promoting sustainability. The company has recently commissioned a new solar power plant that will generate clean energy and reduce its reliance on fossil fuels. Additionally, the company is utilizing waste heat to generate steam and utilizes the organic waste generated to convert into Bio CNG to power its manufacturing operations, further reducing its emissions and fossil fuel related energy demand.
CLIMATE RISK
As a company based in Ahmedabad, Gujarat, Sayaji Industries Ltd. is exposed to various acute physical risks that could impact its operations, including extreme weather events such as floods, droughts, storms, fires, and heavy rains. These risks could affect the companys manufacturing facilities, inventory, and supply chain, leading to disruptions in production and delivery, as well as potential damage to property and equipment.
Mitigation
To mitigate these risks, the company has implemented various measures, including regular monitoring of weather patterns and climate-related risks, as well as disaster preparedness plans. In addition, the company has invested in infrastructure and technology to enhance its resilience to extreme weather events, such as building flood protection measures and implementing fire safety protocols beyond the legal requirements.
PHYSICAL RISKS & MITIGATION OF SUCH RISKS
Sayaji Industries Ltd. also recognizes the potential impact of physical risks on its supply chain, particularly with regard to its reliance on agricultural products such as maize. The company works closely with its suppliers to encourages its suppliers to implement sustainable practices and where possible climate-resilient farming techniques to reduce the risk of crop failures and supply chain disruptions. Sayaji has further tied up with its major customers like Colgate and has initiated measures to reduce its footprint by supplying to the closest factories from supplying to several across the country.
Physical Risk Matrix and Scenario Analysis
To better understand the potential impact of physical risks on our operations, we have developed a Physical Risk Matrix, which assesses the likelihood and potential impact of various physical risks. Based on this assessment, we have identified several scenarios that could affect our operations and developed contingency plans to minimize potential disruptions. For example, in the event of a flood or heavy rainfall, we have established protocols for managing water infiltration and ensuring the safety of our employees and facilities and have emergency preparedness plans. Sayaji conducts mock drills periodically covering all possible scenarios and is well prepared to handle any such emergency
Conclusion
Sayaji Industries Ltd. recognizes the importance of addressing physical risks and is committed to implementing measures to enhance its resilience to extreme weather events and other acute physical risks. Through ongoing monitoring, contingency planning, and collaboration with suppliers, the company aims to minimize potential disruptions and ensure the continued delivery of high-quality products and services to its customers.
TRANSITION RISK
LEGAL RISKS AND MITIGATION OF SUCH RISKS
As a company operating in the corn wet milling industry in India, Sayaji Industries Ltd. - Maize Products is well aware of the importance of managing legal risks in our business operations. There are several legal risks that we face, including compliance with government regulations, intellectual property disputes, and contractual obligations.
To mitigate these risks, we have put in place comprehensive compliance programs that ensure our operations meet all relevant regulatory requirements. We have also taken steps to protect our intellectual property, such as trademarks and patents, to safeguard our products and processes. Additionally, we maintain strong relationships with our customers and suppliers, ensuring that all contractual obligations are clearly defined and met.
Despite our best efforts, however, legal risks can be unpredictable and difficult to control. We recognize that any failure to comply with legal requirements or contractual obligations can have a significant impact on our business, reputation, and financial performance. Therefore, we remain vigilant in our approach to legal risks, continuously monitoring changes in laws and regulations, and working with legal experts to mitigate any potential legal issues that may arise.
By prioritizing legal compliance and proactively managing legal risks, we are confident in our ability to operate effectively and responsibly.
TECHNOLOGY RISKS AND MITIGATION OF SUCH RISKS
As a leading player in the corn wet milling industry, Sayaji Industries Ltd. - Maize Products is well aware of the importance of keeping up with the latest technologies to stay competitive. We understand that the technological landscape is constantly evolving, and we recognize the risks associated with failing to adapt to changing trends.
To mitigate these risks, we have invested in state-of-the-art technologies that allow us to improve efficiency, reduce waste, and enhance the quality of our products. For example, we use advanced processing techniques to manufacture modified starches and other derivatives like liquid glucose, dextrose monohydrate, dextrose anhydrous, and sorbitol. We have also implemented innovative solutions to reduce our environmental footprint, such as utilizing renewable energy sources as well as energy from effluents in addition to implementing water conservation measures where we have achieved our target within a couple of years.
We understand that technology risks can have a significant impact on our business, and we are committed to staying up-to-date with the latest developments in the industry to ensure that we are well-positioned to meet the evolving needs of our customers. By investing in the right technology and continuously updating our processes, we are confident in our ability to remain a leader in the corn wet milling industry and deliver high-quality products to our customers.
MARKET RISKS AND MITIGATION OF SUCH RISKS
As a manufacturer and supplier of maize products, Sayaji Industries Ltd. is exposed to various market risks that can impact its financial performance. One of the key market risks is the growing demand from industries for sustainable sourcing and production processes. As industries are increasingly focused on environmental sustainability and social responsibility, they are seeking suppliers who can demonstrate their commitment to these values.
Sayaji Industries Ltd. recognizes this market risk and has implemented several measures to mitigate it. The company has adopted sustainable practices in its sourcing and production processes, reducing its environmental footprint and demonstrating social responsibility. The company besides evaluating suppliers on parameters like price and quality, also does an evaluation on sustainability and environment related parameters. Sayaji has also taken several initiatives within its production processes, like use of renewable power, energy from waste water and waste energy. In addition, the company has invested in advanced technology and innovative processes to reduce waste, conserve natural resources, and minimize its carbon footprint.
Overall, we believe that our commitment to sustainability is not only a responsible business practice but also a strategic advantage in todays market. We remain committed to continuously improving our sustainable practices, promoting social responsibility, and mitigating market risks associated with sustainability. By adopting sustainable practices, Sayaji Industries Ltd. is well-
AND ANALYSIS
positioned to meet the growing demand for environmentally responsible and socially conscious suppliers. The companys commitment to sustainability and social responsibility not only mitigates market risk but also strengthens its reputation and brand value, building trust and credibility with customers and stakeholders.
RISKS RELATING TO REPUTATION OF THE COMPANY
As a supplier of renowned organizations, Sayaji Industries Ltd. - Maize Products recognizes the importance of maintaining a positive reputation in the industry. We understand that our customers and stakeholders expect us to be responsible and sustainable in our operations, and we strive to meet those expectations. To this end, we have taken significant steps to reduce our environmental footprint, such as reducing water consumption and achieving our 10-year target in just a couple of years. We have also implemented many energy efficiency measures and made changes throughout our organization to prioritize sustainability. We recognize that climate change is an increasingly pressing issue, and we stay informed of developments in this landscape to ensure that we are doing our part. We evaluate stakeholder responses and perspectives on our climate change strategy to understand their potential reputational impacts on our company.
We understand that negative publicity from stakeholders about our products, supply chain, ingredients, packaging, or employees, whether or not deserved, could adversely affect our reputation. As such, we are committed to managing any potential reputational risks and to maintaining our sustainability practices to ensure a positive impact on the environment and society.
In all of our operations, we strive to meet the highest standards of social and environmental responsibility, and we are committed to maintaining our position as a trusted supplier of high-quality maize products.
RISKS RELATING TO EMERGING REGULATIONS
As part of Sayaji Industries - Maize Products commitment to monitor and comply with regulations, we continuously assess emerging regulations that may affect our operations. One such emerging regulation that we are monitoring closely is the development of a National Emissions Trading Scheme (ETS) in India. The Indian government has set ambitious targets to reduce greenhouse gas emissions as part of its Nationally Determined Contribution (NDC) under the Paris Agreement. The upcoming National ETS, which is currently under development, is expected to play a significant role in achieving these targets. As a company operating in the corn wet milling industry in India, we recognize that the implementation of this regulation may impact our operating costs over time. Our commitment to comply with all applicable laws and regulations remains steadfast. Non-compliance with applicable laws and regulations could result in civil remedies, fines, damages, injunctions, product recalls, or criminal sanctions, any of which could adversely affect our business, results of operations, cash flows, and financial condition. Therefore, emerging regulation risks related to climate change are always included in our climate-related risk assessments. We continue to stay informed about new regulations and work to mitigate any risks that may arise.
OUTLOOK
There has been a substantial increase in the price of maize due to geopolitical tensions which continued throughout the year under review. However, the threat of new covid-19 waves has reduced substantially due to large scale vaccination drive by the Government of India and the activities has returned to pre pandemic levels. Your company is also hopeful that the geopolitical situation due to Russia Ukraine war turns for better in the times to come. This coupled with more than normal rains forecast during the current financial year may ease the prices of maize and other inputs in the times to come. The company is also striving to pass on the increased input costs to its customers to the extent possible to ensure that its bottom line is not much adversely affected. The company is also concentrating more on the manufacture of value added products to improve its margins. The company has installed solar power plant of the capacity of 6.6 MW which would lead to savings in the power cost. The company has already sold its land in Kalol during the year under review and is looking to sell its idle land at Kathwada to improve liquidity.
Demand for corn starch products is set to grow with rising incomes, favourable demographics and swift industrial growth. The company offers quality products to consumers worldwide by combining customer insights with scientific and technical excellence. To remain competitive, the Company has invested in modernizing its plant and machinery and reducing the bottlenecks in the production process. The company has aggressively focused on strengthening its cost competitiveness and raising production of higher-margin value-added products to enhance profitability. The company is hopeful that with more than normal monsoon in the maize growing areas like Karnataka, Maharashtra, Telangana, MP, etc. in this monsoon season coupled with culmination of the aforesaid factors will offer sustainable growth opportunities to the company.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The company has an adequate internal control framework commensurate with the size, nature and complexity of its business operations. The internal control systems are formulated as part of the principles of good governance and ensure proper recording and reporting of transactions, safeguarding of assets and protection against losses from any unauthorized use or disposition and misappropriation of funds.
The internal auditors ensures, checks and reviews the internal controls and proactively recommends measures for strengthening them. The internal controls are supplemented by documented policies and procedures, which provide reasonable assurance about the reliability of financial and operational information, fraud control, compliance with applicable statutes and internal policies. The Audit Committee of the Board periodically reviews the internal audit reports to ensure the effectiveness of the internal controls. The management as well as the statutory auditors of the Company review the internal audit findings and undertake relevant action.
HUMAN RESOURCES
Sayaji Industries Ltd. - Maize Products believes in top- down approach when it comes to sustainability and environmental responsibility. The Chairman and Managing Director and Board of Directors are responsible for setting the tone and providing direction to ensure the companys commitment to sustainability is reflected in its policies and practices. The Company Secretary reports directly to the Managing Director and is responsible for ensuring compliance with all regulations including environmental regulations and implementing sustainability initiatives and monitoring the environmental impact of the companys operations. In addition, the company has an independent
Environmental Manager, who is exclusively responsible for managing the function and reports to the Directors.
The company has also established an Internal Environmental Health and Safety (EHS) Committee, comprising of senior management representatives, along with worker initiatives which oversees the implementation of the companys sustainability, environmental as well as energy policies and procedures. In addition, the company has an Energy Management Committee, which is responsible for monitoring the companys energy usage and identifying areas for improvement. The committee is headed by the Electrical and Mechanical Heads of
ESG at Our Company the plants in addition to representatives from various departments. Human resource function by creating adequate roles plays critical role in the company meeting its compliance regulations in addition to the emerging risks.
At Sayaji Industries Ltd. - Maize Products, sustainability and environmental responsibility are integral to the companys business operations and are deeply ingrained in its organizational structure. The company recognizes that it has a responsibility towards the environment and is committed to implementing best practices to minimize its environmental impact.
Environmental Impact
At SIL, we are dedicated to minimizing our environmental impact and promoting sustainable practices across our operations. Our commitment to environmental stewardship is evident through our continuous efforts to reduce greenhouse gas emissions, conserve water, and promote sustainable practices. Below, we outline our interactions with the environment.
Energy Efficiency
In alignment with our commitment to the Nationally Determined Contributions (NDC) targets for GHG emissions reduction, we are dedicated to enhancing the energy efficiency of our operations through the use of renewable energy. To address the environmental risks associated with our production processes, we have installed a solar power plant that generates clean energy. We are also installing a big solar power plant of the capacity of 6.6 MW which in turn would generate clean energy and reduce the power cost. Furthermore, we view waste as a valuable resource. By using biogas generated from ETP as fuel in gas turbine, we significantly reduce our reliance on fossil fuels, thereby promoting sustainable practices and contributing to our overall environmental stewardship.
Climate Change:
We adopt a structured approach to manage climate-related risks and advance our sustainability goals. We focus on immediate resilience and adaptation by monitoring weather patterns, tracking regulatory changes, and conducting continuous risk assessments. Our proactive planning includes implementing energy efficiency measures, optimizing resources, reducing emissions, and engaging in industry collaborations. We invest in research and development, consult with stakeholders, and align with evolving climate trends and best practices. Additionally, we take a comprehensive, long-term view, evaluating the impacts of climate change on our operations. We explore sustainable innovations and alternative technologies to anticipate and adapt to potential disruptions.
Water Stewardship
Our organization takes a proactive stance in identifying and assessing potential water-related risks, particularly those associated with water shortages and their impact on business operations. We use a comprehensive approach that includes monitoring water usage, forecasting future risks, and implementing effective conservation strategies. We adopted a water-related target in 2021 to enhance water use efficiency, aiming for a 10% reduction in water consumption per ton of product by 2032 which we have already achieved.
Our success is attributed to a series of targeted initiatives designed to optimize water usage across our operations. Key to this achievement is our focus on improving the steam-to-coal ratio and also implementing measures to combat steam theft, such as reducing excess air in coal and optimizing ID fan operations.
Waste Management
Effective waste management is a critical component of our companys operations. We are dedicated to reducing waste generation, maximizing recycling, and ensuring the responsible disposal of all waste materials. Our comprehensive approach to waste management minimizes our environmental impact, drives operational efficiency, and supports a circular economy.
Our commitment to Extended Producer Responsibility (EPR) underscores our dedication to sustainable practices and waste minimization. EPR is an integral part of our business strategy, ensuring that we take full responsibility for the products we manufacture, from production through to end-of-life management. By embracing EPR, we are committed to designing environmentally friendly products, implementing efficient take-back programs, and collaborating with recycling partners to foster a sustainable and circular economy.
Social Impact
We believe that our success is intrinsically linked to the well-being of our employees, communities, and stakeholders. Our commitment to social responsibility is at the core of our values and operations, driving us to create a positive and lasting impact on society. We are dedicated to fostering inclusive growth, promoting education and health, supporting local communities, and ensuring fair and ethical business practices.
Employee Health, Safety and Well-being
We prioritize the health and safety of our employees by maintaining rigorous safety standards and protocols across all our operations. Regular training programs and safety audits ensure a safe and secure workplace. We support our employees well-being by promoting work-life balance through flexible work arrangements.
Community Engagement
We actively engage with local communities by supporting educational initiatives that empower individuals and promote lifelong learning. We also support healthcare initiatives that improve access to medical services and promote public health in the communities we serve.
Diversity and Inclusion
We are committed to fostering a diverse and inclusive workplace where all employees feel valued and respected. Our company focuses on recruitment, retention, and development of talent from various backgrounds. We also uphold fair labor practices and ensure equal opportunity for all employees.
Ethical Business Practices
We adhere to the highest ethical standards in all our business practices. Our code of conduct outlines our commitment to integrity, transparency, and accountability.
Our Sustainable Governance
Our governance structure is designed to ensure effective oversight and integration of Environmental and Social impacts into our business practices. We are committed to upholding the highest standards of governance to support our ESG objectives and drive sustainable growth over the long term.
Our Board of Directors plays a critical role in overseeing our ESG journey and ensuring that all policies align with our commitment to environmental and social responsibility. The Board is well-versed in their roles and responsibilities, and we have established a robust system for reviewing and approving all company policies.
By maintaining strong oversight, promoting transparency, and engaging with stakeholders, we are dedicated to advancing positive environmental and social outcomes while adhering to the highest governance standards.
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