Sukhjit Starch Director Discussions

Dear Share Holders :

Your Directors are pleased to present before you the 79th Annual Report and the Audited Statement of Accounts for the year ended 31st March, 2023 :-


( lacs)

F.Y. 2022-23 F.Y. 2021-22
Sales & Other income 1436.97 1158.40
Earning before Interest, Tax and Depreciation 144.70 153.03
-- Interest 25.33 20.88
-- Depreciation 26.63 24.74
Profit before tax 92.74 107.41
-- Current Tax 18.30 25.00
-- Deferred Tax 4.30 2.60
-- Taxes related to previous years -- 2.52
Profit After Tax 70.14 77.29
Surplus brought forward from previous year 16.88 28.78
Transfer to General Reserves 50.00 70.00
Final Dividend -- 4.43
Interim Dividend 12.50 14.76
Surplus carried forward 24.52 16.88


-- The Company has achieved highest ever sales of Rs435.25 crores (PY Rs 1157.19 crores) registering a growth of 24% during FY 2022-23.

-- The EBITA (Earnings before Interest, Tax and Depreciation) stood at Rs 145 Crores v/s Rs 151 crores during the previous year.

-- After a charge of interest of Rs 25.33 crores (Rs 20.88 crores), depreciation of Rs 26.63 crores (Rs 24.74 crores) and tax of Rs 22.60 crores (Rs 30.12 crores), the Net Profit after tax came at Rs 70.14 crores (Rs 77.29 crores) for the year.

The EBITA and profit margins were adversely affected, across the Industry, due to higher raw material prices & increased energy cost, mainly owing to the geo political situation / global disturbance during the year ended 31st March, 2023.


The Company had declared and paid an interim dividend of H 8/- per Equity Share of face value Rs 10/- each (i.e. 80%) in the month of December, 2022. The Board has considered the said interim dividend of

Rs 8 per equity share as the final dividend for the financial year 2022-23 (against Rs 10/- per equity share during FY 2021-22) in order to conserve resouces for future expansions in the operations of the Company. The Dividend Distribution Policy, in terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations) is available on the Companys website on https://www.


After payment of the interim dividend of Rs 12.50 crores in December, 2022, the Company was left with Rs 74.52 crores surplus out of which Rs 50 crores have been transferred to the general reserves (PY Rs 70 crores) and Rs 24.52 crores have been carried forward in the retained earnings account.


The paid up share capital of the Company stood at Rs 15.62 crores as on 31.03.2023. There was no issue of fresh shares by way of public issue, bonus issue, right or preferential issue during the financial year 2022-23.


The total Non Current Assets (including capital work-in progress) of the Company appeared at Rs 512.53 crores as on 31.03.2023 against Rs 507.31 crores as on 31.03.2022 after providing depreciation of Rs 26.63 crores during the year (Rs 24.74 crores).

The Company has made a Capital expenditure (on addition of fixed assets) of Rs 34.77 crores during the year on account of balancing / upgrading of its manufacturing facilities. The Board of Directors has approved Capital expenditure of Rs 37 crores for the financial year 2023-24, which will be used for upgrading / modernizing some key equipments of the units to ramp up the capacities at the existing locations. The proposed Cap-ex will be met out of the internal accruals of the company.

The Current Assets of the Company appeared at Rs 392.30 crores on 31.03.2023 as compared to Rs 275.38 crores on 31.03.2022 including Inventories at Rs 167.67 crores against Rs 96.05 crores in the previous year due to higher holding of the basic raw material, which is seasonally available.

The company has long term Bank Borrowings of about 30 crores (payable in a period of two years after the end of the running financial year), net of the current maturity of the term loans of Rs 20.09 crores payable till 31.03.2024. The internal accruals of the company will be enough to take care of this repayment & strengthen the working capital of the company. However, company has liquid investments of Rs 77.52 crores against Rs 65.90 crores last year as an additional cushion to the liquidity of the company.

The management believes that the Company has sufficient liquid resources at hand to meet up any additional working capital requirements / other business exigencies.


As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Management Discussion and Analysis report is annexed herewith marked as Annexure A and forms a part of this report.


Your company is fully committed to the philosophy of transparency and believes in conducting its business scrupulously with due compliance of all the applicable laws, rules and regulations. In pursuance to the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended to date, the report on the Corporate Governance is annexed to this report marked as Annexure B.


Pursuant to Section 134 (3c) of the Companies Act, 2013, the Directors state that: (a) in the preparation of the Annual Accounts for the financial year ended 31st March, 2023, the applicable Indian Accounting Standards have been followed and there are no material departures; (b) appropriate accounting policies have been selected and applied consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the company for the year so ended; (c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) the Annual Accounts for the year ended 31.03.2023, have been prepared on a going concern basis; (e) the internal financial controls have been laid down to be followed by the company and that such internal financial controls are adequate and are operating effectively; and (f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.


The Vijoy Steel & General Mills Company Ltd., Phagwara: The Company held 96.17% of shares in the capital of The Vijoy Steel & the General Mills Co. Ltd. The Company continued providing necessary engineering support to the manufacturing operations of the Company.

Scott Industries Ltd., Phagwara: The Company held 99.97% of shares in the capital of the Scott Industries Ltd. The Company has shut down its operations. Most of its assets have already been disposed of and efforts are on to realize the old dues from its customers and wind up the Company.

Sukhjit Mega Food Park & Infra Ltd., Phagwara:

The Company held 100% of shares in the capital of its material subsidiary Sukhjit Mega Food Park & Infra Ltd. The Company had operationalised its project of the Mega Food Park in the state of Punjab in FY2020-21 creating a State of Art Technology Infrastructure for setting up food processing units in the Mega Food Park. A good part of its assets have been leased out and operationalised. However, the expected Investments in the Mega Food Park got delayed owing to the outbreak of Covid as the prospective investors, instead of investing in new projects, remained occupied for a long time, in protecting their existing businesses. The Company is however, cash positive during the year and expects to improve its revenues in the coming years.

There has been no material change in the nature of business of the Subsidiaries. As required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended to date, the Consolidated Financial Statements of the Company and its subsidiaries are attached, which have been prepared in accordance with the relevant Indian Accounting Standard(s) as prescribed under the Companies Act, 2013.

In pursuance to the general circular issued by the Ministry of Corporate Affairs, the Balance Sheet, Profit & Loss Account and other documents of the subsidiary companies are not being annexed to the Balance Sheet of the Company. A statement containing the requisite financial details of the companys subsidiaries for the financial year ended 31st March, 2023 is annexed to the consolidated results forming part of the Annual Report.

InaccordancewithSection136(1)oftheAct,theaudited financial statements including the consolidated financial statements and related information of the Company and the separate financial statements of each of the subsidiary companies, are available on the Companys website at The annual accounts of these subsidiaries and the related detailed information will be made available on demand, to any shareholder of the Company who may be interested in seeking such information. Copies of the above documents are also available for inspection by any shareholder of the Company at the registered office of the Company during business hours.


In terms of the provisions of section 197 (12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the names and other particulars of Directors/ KMPs/ Employees are set out in the Annexure C to the Directors Report.


(a) Smt. Manjoo Sardana (DIN: 08533106), Non Executive Chairperson of the Company, is retiring by rotation and being eligible, offers herself for reappointment. Board recommends her reappointment as the Non Executive Chairperson of the Company.

(b) The existing tenure of Sh. Tarsem Singh Lally, a Non Executive Independent Director of the Company (DIN : 00381009) is expiring on 12/08/2023. Sh. Tarsem Singh Lally is an Engineering Graduate and an experienced entrepreneur with sound business background. He has lifelong commercial/ technical experience of over 48 years in various fields to his credit. His continuance as a member of the Board will enrich the board deliberations and strengthen its composition. The Board of Directors has recommended his re-appointment for a further period of 3 years i.e. w.e.f 13/08/2023 upto 12/08/2026, subject to the approval of shareholders in the ensuing Annual General Meeting.

(c) The Board has re-appointed Sh. M.G. Sharma (DIN: 00398326) as Executive Director (Fin.) & CFO of the Company in its meeting held on 27.05.2023 (subject to approval of the members in the ensuing General Meeting) as his existing term expired on 31.05.2023. Sh. M.G. Sharma has been associated with the company for over four decades and has been involved in policy formulation and various other activities like project / product planning & development. He is also actively involved in key areas like procurement of raw materials, marketing of finished products and other commercial activities besides heading the finance functions of the Company. The Board, therefore, in the overall interest of the company, recommended his re-appointment as Executive Director (Fin) & CFO for a further period of 3 years i.e. with effect from 1st June, 2023 to 31st May, 2026.

(d) The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence and comply with all the requirements in pursuance to subsection (6) of Section 149 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, so as to qualify themselves to be appointed / continue as Independent Directors under the provisions of the Act and rules thereunder.

(e) Based on evaluation criteria laid down under the Nomination and Remuneration Policy of the Company, framed in accordance with the provisions of section 178 of the Companies Act,

2013, the Nomination & Remuneration Committee rates the performance of the individual directors and also the Board as a whole, which, inter-alia, include : - evaluation of leadership abilities - contribution to corporate objectives & plans - regular monitoring of performance - effective decision making ability - attendance / contribution at Board and Committee meetings etc.

The Company has in place a suitable Policy for the Appointment & Remuneration of the Directors/ KMPs. The Company has devised the Boards Performance Evaluation criteria for evaluation of Boards / Committees / Directors performance. The performance of the Committees was evaluated by the Board on the basis of the criteria such as the composition of committees and effectiveness of committee meetings etc.

The Independent Directors in their Separate Meeting reviewed the performance of Non- Independent Directors, the composition & performance of the Board of Directors as a whole, frequency of Board meetings etc. The Independent Directors also reviewed the performance & participation of the Chairperson of the Company. Such proceedings were placed on record and discussed in the Board Meeting following the meeting of the Independent Directors. The Board of Directors expressed their satisfaction over the evaluation process.


Eight (8) meetings of the Board of Directors were convened and held during the financial year 2022-23. The maximum intervening gap between the meetings was within the period prescribed under the provisions of Section 173 of the Act and Listing Regulations. The further details of Board/Committee Meetings including composition and attendance are set out in the Annexure B the Corporate Governance Report, forming part of this Report.


The powers, role and terms of reference of the Audit Committee cover the areas as contemplated under Section 177 of the Companies Act, 2013 (the Act) and Regulation 18 of the SEBI (LODR) Regulations, 2015, as applicable, besides other matters as referred by the Board of Directors from time to time.

The primary objectives of the audit committee inter alia include : - to monitor and provide an effective supervision of the Managements financial reporting process, - to ensure accurate and timely disclosures with highest levels of transparency, integrity and quality of financial reporting, - to oversee the financial reporting process by the Management, the internal auditors and the independent auditors, - to take all possible measures to ensure the objectivity and independence of the independent auditors.

The Committee mandatorily reviews information such as internal audit reports related to internal control weakness, management discussion & analysis and operational results, statement of significant related party transactions and such other matters as prescribed.

During the year under reference, the Audit Committee of the Company consisted of Sh. Ranbir Singh Seehra as the Chairman, Sh. Vikas Uppal, Sh. Saravjit Singh Hothi and Sh. M.G. Sharma as its members. All recommendations made by the Audit Committee during the year were accepted by the Board.


Internal financial control systems of your company provide for proper authorisation of the transactions, timely recording & reporting in the desired manner to ensure the reliability of financial reporting, timely feedback on the achievement of operational or strategic goals and compliance with all the applicable laws & regulations. The Internal & External Auditors of the Company also measure the effectiveness of internal controls through periodical checks and ensure that company has an effective internal control system duly commensurate with its size and nature of business. The management reviews the systems periodically to systematically improve business processes in regard to their effectiveness and efficiency.


Pursuant to Section 177 of the Companies Act, 2013 & rules made thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a vigil mechanism, which also incorporates a Whistle

Blower Policy, for Directors and employees of the Company to report genuine concerns of unethical behavior or violation of code of conduct by way of direct access to the Chairman of the Audit Committee. There are adequate safeguards against victimization of employees/ directors who express their concerns. The Whistle Blower Policy of the Company stands placed on the Companys website at the link: https://www.


The company recognizes that the risk management and internal control are the key elements for sustainable working of an organization and good corporate governance. It has formulated the Risk Management Policy which describes the manner in which the company identifies, assesses, monitors and manages risks. The details of the policy are available at companys website at risk-management-policy


(i) All the deposits have been accepted / renewed / repaid as per the provisions of the Companies Act. The company had no unclaimed / unpaid deposits on 31/03/2023.

(ii) Unsecured Loans as on 31/03/2023 include H 0.55 crores (P.Y. H 0.52 crores) received from directors, which have been made out of their own funds and not from the funds acquired by them by borrowing or accepting loans or deposits from others, as per the declarations received from the concerned directors.

(iii) The Company has duly complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors, Committee Meetings and the General Meetings.

(iv) No shares have been issued during the year under reference with differential rights as to dividend, voting or otherwise.

(v) There is no significant and material order passed by any Regulator, Court, Tribunal which may impact the going concern status of the Company and Companys operations in future.

(vi) There are no material changes or commitments affecting the financial position of the Company which occurred between the end of the financial year to the date of this report.

(vii) There is no Corporate Insolvency Resolution Process initiated under the Insolvency and Bankruptcy Code, 2016 against the Company or any of its subsidiaries.

(viii) There is no change in the nature of companys business during the year under review.

(ix) There was no instance of fraud during the year under reference which required the Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12) of Act and Rules made there under.

(x) The Board has constituted an Internal Committee for redressal of grievance(s) / complaint(s) (if any) under the provisions of the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The committee has not received any complaint during the year under reference.

(xi) In view of the relaxation granted by MCA /SEBI amid Covid-19 pandemic and as per the Green Initiative taken by MCA, the Company is serving its shareholders all communications / documents including Annual Reports, Notices, Circulars etc. through electronic mode. The shareholders who have not registered / updated their Email IDs with the Company / RTA are, once again, requested to kindly register /update the same with the Company / RTA in case of physical shares and with their Depository Participants in respect of shares held in Demat form.

(xii) There has been no default in repayment of deposits or payment of interest thereon during the year.

(xiii) There was no instance during the year where the recommendations of any committee were not accepted by the Board.

(xiv) The requirement to disclose the details of difference between the amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.


The report on Corporate Social Responsibility activities carried out during the financial year 2022-23 is annexed herewith marked as Annexure D to this report.


Pursuant to the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 and amendments thereto, the Company has adopted an Internal Code of Conduct for Regulating, Monitoring and Reporting of Trades by the Designated Persons. The Code is to prevent Insider

Trading by the Directors and other Designated Persons who are considered to have access to the Unpublished Price Sensitive Information relating to the Company.


The Company has not entered into any material transaction with its Directors, Key Managerial Personnel or their Relatives which could have potential conflict with the interest of the Company. The salaries/ remuneration of the directors and KMPs have been fixed after due consideration and approval by the Nomination and Remuneration Committee / Board / Shareholders as per applicable provisions of the Act. The transactions with the subsidiary companies mainly include the supply of some key infrastructural facilities and utilities by Sukhjit Mega Food Park and Infra Ltd., which is a wholly owned subsidiary of the Company. However, the transactions with subsidiary Companies are incurred after due appraisal, approval(s) at appropriate levels and omnibus approval by the Audit Committee / Board, which are in the ordinary course of business and are at an arms length price. In terms of IND AS-24, the details of such transactions are duly presented in the Notes to Accounts forming part of the Annual Report. Policy on related party transactions of the company appears on the Companys website at the link:


Particulars of loans given and Investments made by the Company are provided in the standalone financial statements. The Company has given/provided some Guarantees / Securities to the Govt. / other Departments in the ordinary course of business. The company has also provided Corporate guarantee(s) for H 40 crores to the Yes Bank Ltd. against the Term Loan for setting up the Mega Food Park by its wholly owned subsidiary M/s Sukhjit Mega Food Park & Infra Ltd. The outstanding balance of term loan appeared at H 18 crores due to the Yes Bank Ltd. as on 31.03.2023. There is no any other Guarantee / third party Guarantee / security given / provided by the Company.


Extract of the Annual Return of the Company is annexed herewith as Annexure E to this report. A copy of the same has also been placed on Companys website at the link : annual-return


The necessary details are annexed herewith as Annexure F to this report.


Pursuant to the applicable provisions of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF Rules), the company has transferred during FY 2022-23 : (a) Rs 10,68,045/- as unpaid / unclaimed dividend for FY2014-15 to the Investor Education and Protection Fund (IEPF).

(b) Rs 10,92,495/- as unpaid / unclaimed interim dividend for FY 2015-16 to the Investor Education and Protection Fund (IEPF).

(c) 8592 shares to the demat account of the IEPF Authority on which dividend has not been paid / claimed by the shareholders for 7 (seven) consecutive years or more.


Statutory Auditors :

M/s Y K Sud & Co., Chartered Accountants (FRN 000047N), the retiring Auditors of the Company have confirmed their eligibility to be re-appointed as Statutory Auditors of the Company at the ensuing Annual General Meeting. The Board of Directors recommend the re-appointment of M/s Y K Sud & Co., Chartered Accountants as auditors of the Company to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting. The Company has paid a sum of •7.08 lacs (incl. GST) to M/s Y K Sud & Co., Chartered Accountants as audit fees during the Financial Year ended 31st March, 2023.

The Auditors report for the financial year ended 31/03/2023 does not have any qualification, reservation, adverse remark or disclaimer by the statutory auditors.

Cost Auditors :

The Board of Directors recommends the re-appointment of M/s Khushwinder Kumar & Associates, Cost Accountants, as Cost Auditors of the Company for the financial year 2023-24, subject to the approval of the Central Government. The Cost Audit Report for the financial year ended 31st March, 2023 is due to be filed with the Ministry of Corporate affairs on or before the 30th September, 2023 and the cost audit report for the financial year ended 31/03/2022 was duly filed within the due dates.

Secretarial Auditors :

The Board has re-appointed M/s Dinesh Gupta & Co., Practicing Company Secretaries, as Secretarial Auditors for the financial year 2023-24.

The Secretarial Audit Report for the financial year ended 31st March, 2023, in relation to compliance of all applicable SEBI Regulations/circulars/ guidelines issued thereunder, pursuant to requirement of Regulation 24A of Listing Regulations along with the Secretarial Audit Report of the material subsidiary company is set out in Annexure H to this report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.


Your Directors hereby acknowledge the dedication, loyalty, hard work, solidarity and committed services of the executives, staff & workers of the Company. They would also like to place on record their appreciation for the continued co-operation and support received by the Company during the year from bankers, financial institutions, government authorities, business associates, shareholders, vendors, customers and other stakeholders and for the confidence reposed in the Company and its management and look forward to their continued support.