Vishnu Sugar Mills Ltd Directors Report

TO THE SHAREHOLDERS

The Board of Directors have pleasure in presenting the eighty-first Annual Report together with Audited Accounts of the company for the year ended on 31st March, 2013.

	Rs.
FINANCIAL RESULTS :
Profit before interest, depreciation & taxation	8,97,33,313
Less : Interest	5,04,80,066
Depreciation	2,21,26,087
Taxation
Deferred Tax	36,70,626
	7,62,76,779
Profit for the year	1,34,56,534
To which is added
Balance brought forward from previous year	1,07,68,955
	2,42,25,489
Appropriation :
Molasses Storage Reserve	1,16,85,342
Balance to be carried forward to next year	1,25,40,147

DIVIDEND :

In view of meager profit and to conserve the resources, Directors do not recommend payment of Dividend on Equity Shares for the year under review.

OPERATIONAL RESULTS :

The operation of the crushing season 2012-13 commenced on 29th November, 2012 and concluded on 16th March, 2013 after crushing 44.76 lac quintals of cane against 39.19 lac quintals in the last season. Inspite of improvement in cane availability, there has been sharp decline in sugar recovery which dropped to 8.97 percent against 9.50 percent last year due to unprecedented adverse weather conditions consequent to which sugar content in sugar cane was drastically reduced. This was general phenomenon throughout the State of Bihar where entire sugar mills suffered immensely due to abrupt fall in sugar recovery. The cost of production went haywire mainly due to low recovery, sharp increase in sugar cane cost and manufacturing expenses.

INDUSTRY SCENARIO & POLICIES :

Sugar production in the country for the season 2012-13 is likely to be around at 230 lac tons against 234 lac tons last year & closing stock 180 lac tons against 173 lac tons. In spite of sugar surplus Import continue unabated and sugar prices ruled much below cost of production.

The imposition of supply of levy sugar was dispensed with on 4th April, 2013 on the production of sugar for the season 2012-13 along with monthly release system.

The Fair & Remunerative Price (FRP) of sugar cane for the season 2012-13 was fixed at Rs.170/- per qtl. as against Rs.145/- per qtl. in the last season, linked to a basic recovery of 9.5%. The FRP for the season 2013-14 has been increased to Rs.210/- per qtl. However, these prices remained a notional price as every State Govt. announced a very high cane price to gain political mileage, ignoring the economics and paying capacity of Sugar Mills.

The completion of expansion of capacity to 7500 TCD in phases has been delayed due to unfavorable Govt. policies & market condition.

As per Notification issued by the Govt. of India dated 04-06-2010 & 09-08-2010 all the listed companies are required to achieve the norms of listing in regard to public share holdings. In view of the above the Company is in the process of voluntary delisting of its Equity Shares from Bombay Stock Exchange Ltd. in accordance with SEBI (Delisting of Equity Shares) Regulation, 2009.

DIRECTORS :

Mr. P. K. Dalmia retires from the board by rotation and being eligible offers himself for reappointment.

AUDITORS :

Messrs. L.B. Jha & Co., Chartered Accountants, auditor of the company, retire and have expressed their willingness to continue in office, if re-appointed.

The note to the accounts referred to in the Auditors’ Report are self-explanatory and therefore do not call for any further explanation under section 217(3) of the Companies Act, 1956.

PARTICULRS OF EMPLOYEES :

None of the employees of the company were in receipt of remuneration, which in the aggregate exceeded the limits fixed under sub-section (2A) of the Section 217 of the Companies Act, 1956.

CONSERVATION OF ENERGY :

Information as per Section 217(1) (a) of the Companies Act, 1956 to the extent applicable are set out in annexure hereto.

DIRECTORS RESPONSIBILITY STATEMENT :

Your Directors state that in the preparation of the annual accounts, the applicable standards have been followed. They have selected such accounting policies and applied them 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 that period. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities and that the annual accounts have been prepared on a going concern basis.

COMPLIANCE CERTIFICATE :

The company has obtained secretarial Compliance Certificate as required under Companies (Compliance Certificate) Rules, 2001. Members can inspect the same at the registered office of the Company.

CORPORATE GOVERNANCE :

The Management discussion and analysis and the compliance of recommendations on corporate governance are annexed to this report.

APPRECIATION :

Your Directors wish to place on record the sincere and dedicated services of workers, staff and officers of the company. Your Directors also take this opportunity to express their appreciation for the instinctive support and assistance received from your banker, State Bank of India.

	For and on behalf of the Board
Place : Kolkata	K. K. BAJORIA
Dated : 20th July, 2013	Managing Director

Information pursuant to the Companies (Disclosure of Particulars in the report of Board of Directors) Rules, 1988 and forming part of the Directors Report for the year ended 31st March, 2013.

CONSERVATION OF ENERGY :

a) Energy Conservation Measures taken :

Your Company continues to give priority to conservation of energy on an ongoing basis by installing latest equipment and automation of control devices and instruments.

b) The required data with regard to conservation of energy is furnished below :

A. Power and Fuel Consumption : (in process of manufacture)	Current Year 2012-2013	Previous Year 2011-2012
1. Electricity
a) Units purchased (Units)	–	–
Total amount (Rs.)	–	–
Rate per unit (Rs.)	–	–
b) Own generation through
Diesel Generators (Units)	5,10,518	5,15,707
Units per ltr. of diesel oil	3.23	3.21
Cost per unit (Rs.)	14.26	13.30
c) Through Steam Turbine/Generator
Units	96,45,700	95,30,514
Units per qtl. of Bagasse	Steam produced by use of own bagasse	Steam produced by use of own bagasse
2. Coal, Furnace oil & others	Nil	Nil
B. CONSUMPTION PER UNIT OF PRODUCTION :
Sugar (In lac qtls.)	4.12	3.84
Electricity per qtl. of sugar	24.66	26.17

C. RESEARCH & DEVELOPMENT & TECHNOLOGY ABSORPTION :

Your company has been carrying out research & development in the following specific areas :

(i) Heat Treatment Therapy to eradicate seed borne diseases.

(ii) Pest control measures to protect cane from diseases.

(iii) Rearing of seed nurseries for new improved varieties.

(iv) Ratoon and Water Management of sugarcane crop.

(v) Soil Test and Biological Control Laboratory.

(vi) Tissue Culture Laboratory.

(vii) Production of Vermi Compost using press mud and other sugar mill waste.

Future Plans are :

(i) Production of De-composer.

(ii) Continue research for better yielding and disease free cane varieties.

(iii) Installation of machineries with latest technology along with expansion of crushing capacity to 7500 TCD.

(iv) Expansion of capacity Bio Compost & Vermi Compost project.

(v) Setting up Cogeneration Plant for generation of electricity.

(vi) Expansion of Tissue Culture Lab.

(vii) Setting up a Distillery.

(viii) Water & Steam management.

(ix) Power saving devices.

The company has not imported any technology.

D. FOREIGN EXCHANGE EARNINGS AND OUTGO :

During the period, there has been outgo in foreign exchange equivalent to Rs.NIL.

	For and on behalf of the Board
Kolkata	K. K. BAJORIA
Dated : 20th July, 2013	Managing Director