Annual Report 2019 2020
Annual Report 2019 2020
Annual Report 2019 2020
25
CELEBRATING
YEARS
OF OPERATIONS
Forward-looking statement We cannot guarantee that these
In this Annual Report we have disclosed forward looking statements will be
forward-looking information to enable realised, although we believe we
investors to comprehend our prospects have been prudent in assumptions.
and take informed investment decisions. The achievement of results is subject
This report and other statements - to risks, uncertainties and even
written and oral - that we periodically inaccurate assumptions. Should known
make contain forward-looking or unknown risks or uncertainties
statements that set out anticipated materialise or should underlying
results based on the management’s assumptions prove inaccurate, actual
plans and assumptions. We have tried results could vary materially from those
wherever possible to identify such anticipated, estimated or projected.
statements by using words such as Readers should bear this in mind. We
‘anticipates’, ‘estimates’, ‘expects’, ‘projects’, undertake no obligation to publicly
‘intends’, ‘plans’, ‘believes’, and words of update any forward-looking statements,
similar substance in connection with whether as a result of new information.
any discussion of future performance.
Contents 02 Corporate
snapshot
14 Performance review,
2019-20 18 Dwarikesh and the
Covid-19 impact
22 How we enhanced
shareholder value in
2019-20 28 The Dwarikesh
business model
30 Management discussion
and analysis 46 Corporate social
responsibility
48 Environment
responsibility at
Dwarikesh 50 Notice
60 Directors’
Report 74 Corporate
Governance
Report
114 Auditors’
Report 122 Financial
Statements
At Dwarikesh Sugar Industries Limited,
we believe in the 2P’s leading to
successful and sustainable performance.
Our mission
Background
The Company was founded in 1993 by Shri Gautam Morarka with the aim to create one of the most
respected sugar companies in India. Over the years, Dwarikesh Sugar has emerged as one of the
most sustainable multi-product sugar companies in India.
The Company has three manufacturing units spread across two regions in Uttar Pradesh. The
Dwarikesh Nagar and Dwarikesh Puram plants are located 52 kilometers apart in Bijnor district; the
Dwarikesh Dham plant is located in Bareilly district.
Capacities
The Company’s first sugar manufacturing capacity was established in 1995 in Bijnor, Uttar Pradesh,
with a cane crushing capacity of 2,500 tonnes per day. The Company’s aggregate crushing capacity
was 21,500 tonnes of cane per day at the close of 2019-20. Besides, the Company possessed an
installed capacity of 100 kilolitres of ethanol per day and co-generated 91 MW of renewable power.
People
The Company was an employer of 711 permanent non-seasonal talents as on 31 March, 2020
across its manufacturing facilities and offices. A significant per cent of the employees were based at
the rural manufacturing plants, strengthening the local fabric.
Products
The Company is engaged in the manufacture of sugar, ethanol (and related products) and power.
The Company is likely to embark on the manufacture of value-added chemical products to address
a growing social need following the outbreak of the Novel Coronavirus.
Resource availability
The Company works with an aggregate 1,32,205 farmers across 1,17,103 hectares of its command
areas of three locations. The Company increased cane procurement from 193.90 lakh quintals in
sugar season (SS) 2007-08 to 374.17 lakh quintals in SS 2019-20, strengthening the local economy.
Listing
The Company is listed on the National Stock Exchange and Bombay Stock Exchange. As on 31st
March, 2020, it enjoyed a market capitalisation of R312 crore.
operations
Established the initiatives undertaken
Company
1993 1994
performed 1,190
1,084
141.47
few years
2016-17 2017-18 2018-19 2019-20 2016-17 2017-18 2018-19 2019-20
Revenues EBITDA
Definition Definition
Growth in sales net of taxes and excise Earning before the deduction of fixed
duties. expenses (interest, depreciation,
extraordinary items and tax).
Why is this measured?
It is an index that showcases the Why is this measured?
Company’s ability to enhance revenues, It is an index that showcases the
an index that can be compared with Company’s ability to generate a surplus
sectoral peers. following operating costs.
What does it mean? What does it mean?
Aggregate sales increased by 23.25% Helps create a robust growth engine and
to C1,336 crore in FY2019-20 due to sustain profits.
increased crushing and increased
Value impact
exports.
The Company reported a decline
Value impact in EBITDA on account of lower
The Company performed better than the cogeneration realisations. However,
sectoral average in revenue growth. the surplus was reasonable in view of
sectoral challenges.
101.45 0.33
15.23
95.11
73.45 11.19
10.59
0.15
2016-17 2017-18 2018-19 2019-20 2016-17 2017-18 2018-19 2019-20 2016-17 2017-18 2018-19 2019-20
Net profit EBITDA margin Gearing
5.04 365.82
4.98
4.24 286.01
3.32 3.17
2.94
2016-17 2017-18 2018-19 2019-20 2016-17 2017-18 2018-19 2019-20 2016-17 2017-18 2018-19 2019-20
Average debt cost Interest cover Net worth
Definition Definition
Definition
This is derived through the division of This is derived through the accretion of
This is derived through the calculation
EBITDA by interest outflow. shareholder-owned funds.
of the average cost of the consolidated
debt on the Company’s books. Why is this measured? Why is this measured?
Interest cover indicates the Company’s Net worth indicates the financial
Why is this measured?
comfort in servicing interest – the higher soundness of the Company – the higher
This indicates our ability in convincing
the better. the better.
bankers and other debt providers of
the robustness of our business model, What does it mean? What does it mean?
translating into a progressively lower A company’s ability to meet its interest This indicates the borrowing capacity of
debt cost (potentially leading to higher obligations, an aspect of its solvency, the Company and influences the gearing
margins). is one of the most important drivers of (which influenced the cost at which the
shareholder value. Company could mobilise debt).
What does it mean?
Lower cost of debt indicated increased Value impact Value impact
profitability and a room to strengthen The Company’s interest cover, though The Company’s net worth strengthened
the credit rating. weakened during the year, was adequate 4.34% during the year in spite of a higher
given the sectoral sluggishness. dividend pay-out.
Value impact
The debt cost was marginally higher than
in the previous year, but considerably
lower than the Company’s long-term
average. Debt cost for the year was also
impacted by the availing of loan for new
distillery plant.
2,510 2,492
26.07
3.034 2,205
22.46
2.628
2015-16 2016-17 2017-18 2018-19 2019-20 2015-16 2016-17 2017-18 2018-19 2019-20 2015-16 2016-17 2017-18 2018-19 2019-20
Passion and
perseverance
at work
Priorities
One has often been asked: What is the reason that At Dwarikesh, we resolved to never over-leverage
Dwarikesh Sugar has endured across a quarter of a our Balance Sheet in an agri-commodity business
century? where price swings could be extensive. We focused
on expansion only to the extent that our Balance
There are two answers: at our company, we have
Sheet and desired risk appetite could sustain. We
worked with a deeper passion than most and we
sought to maximise revenues from our non-sugar
have persevered by just hanging in there.
business as a hedge against sugar price declines.
When we entered the sugar industry, we sought to We increased technology investments (both on the
be the best, but never the biggest. This influenced cane side and plant side) that strengthened our
everything that we stood for: we invested more in operating efficiencies.
enhancing operating efficiency than taking sizable
The outcome of our passionate approach was
loans to substantially increase our crushing capacity
evident from the time we commissioned our first
that could have compromised our managerial
plant around 25 years ago. There was no cane field
and financial bandwidth. We created an optimal
for miles; the only road to the land that we had
package of core and byproduct businesses, making
purchased was kutcha; there was no semi-urban
it possible to progressively maximise resource
support system in the vicinity (telephones, potable
consumption, insourcing and value-addition.
Strategic outlook
At the end of our first 25 years, we are in our older plants, expansion in our distillery
what we always wanted to be: one of the capacity, extension into refined sugar and
most respected Indian sugar companies. graduation into retail consumer packaging.
We believe we possess a rightly-sized
As the quantum of capital expenditure
company: 21,500 TCD of sugar capacity, 100
declines, we expect to strengthen our
KLPD distillery and 56 MW of exportable
working capital management, increase
co-generation. We may not be the largest
margins and gradually turn cash-flow positive
in our business; we are more of a boutique
around a right-sized sugar inventory.
company that combines art with science
to run some of the most efficient plants in The best is yet to be.
India’s sugar sector.
Gautam R. Morarka, Executive Chairman
Going ahead, we see growth being derived
from investments in improved technologies
The combination of
platform, production
and recoveries made it
possible for the Company
to strengthen its prospects
Overview
The big message that we wish to send out to The third message is that in addition to
our shareholders is that despite a number of record volumes, the Company delivered
challenges that the Company encountered record recoveries as well. Each of the
during the year under review, it strengthened Company’s manufacturing facilities delivered
the operating platform that could strengthen a recovery in excess of 12%; three of the
revenues and profits across the foreseeable Company’s plants figured in the five highest
future. recoveries in Uttar Pradesh; from a group wise
perspective, the Company held the leading
The other message that we wish to
position on the basis of recoveries in Uttar
communicate is that the Company reconciled
Pradesh.
volume and value during the sugar season
2019-20. The Company generated near- The combination of platform, production and
record crushing: in a season when the Indian recoveries made it possible for the Company
cane output declined by almost 19%, the to address business realities for the moment
Company’s crushing increased by 22%. We and strengthen its prospects.
did better than was expected due to the
persevering cane development activities
across the last number of years, timely
remuneration and high cane prices.
Cane development
The Company continued to deepen its cane for farmers on the one hand and superior
development during the year under review. recoveries for mills on the other.
This development comprised the advocacy of
The result of this sustained evangelism is that
the early maturing variety for the uninitiated,
the Company increased crushing throughput
trench farming, use of advanced pesticide
for the season 2019-20. The increase in
and fertiliser varieties as well as proactive
the Company’s crushed throughput was
responsiveness in arresting disease incidence
nearly 3x the increase in Uttar Pradesh and
(red rot in 2019-20).
represented a substantial improvement
The result is that the Company encouraged over the national decline in cane output by
and assisted farmers to extend the non-cane 19%. Increased crushing broad-based the
portion of their farms to cane, increasing the Company’s resource foundation to sustain
aggregate cane coverage across its command the production of sugar, distillery products
areas to around 95%. Besides, this increase and power (co-generation).
comprised the early maturing CO 0238
cane variety, which continued to generate
a win-win proposition: high sustained yields
Outlook
The principal objective for the Company is The Company intends to increase liquidity
to liquidate its sugar inventory with speed, and moderate debt with the objective
maximise liquidity and right-size the revenue to build a progressively margins-driven
mix. We believe that a prudent imbalance of company across the foreseeable future.
revenues derived sugar, ethanol (also through
Vijay S. Banka, Managing Director
B-Heavy molasses route) and co-generation
should enhance revenue maximisation and
superior margins.
Sugar
1 � Temporary decline in demand
� Future relevance intact
� 92.21% of Dwarikesh external revenues
Ethanol
� Temporary decline
The impact of in offtake
the pandemic on 2 � Future relevance intact
our verticals
� 4.19% of Dwarikesh revenues (likely
to be scaled up in coming years on
account capacity expansion)
Co-generation
3 � Continued relevance
� Future relevance intact
� 3.6% of Dwarikesh external revenues
2.94 3.32
% average cost % average cost
(long-term + short- (long-term + short-
term), 2018-19 term), 2019-20
*Without considering sugar sacrificed on account of use of B Heavy molasses for making ethanol)
We remunerated We established
farmers in time for weighment
cane purchased (electronic) integrity
Our vision
Build the Enter into Remunerate Transform Strengthen Strengthen Focus on
business around partnerships and fairly, promptly and stakeholders into the Company’s governance emerging as a
fairness for all relationships with commensurately long-term partners brand around standards around rightly-sized model
stakeholders stakeholders passion and the highest sugar company
outperformance standards
Drivers of Dwarikesh value Our bankers continue to provide growth focus is sell to a large number of stable
At Dwarikesh, we believe that the debt and working capital finance; we seek customers across our different products.
interplay of value for our various to provide timely repayment of their dues.
Our communities provide the social
stakeholders has translated into our Our vendors provide credible and a capital (education, culture etc.). Our focus
business profitability and sustainability. continuously supply of resources (cane, is to support and grow communities
Our employees represent the aggregate chemicals, equipment and services). Our through consistent engagement.
knowledge of how to grow the business focus is to maximise quality procurement
Our governments in the areas of
across a range of functions (strategy, at stable or declining average costs,
our presence provide us with a stable
cane development, manufacturing, remunerate them quicker than the
structural framework that ensures law,
marketing, finance etc.). Our focus is to market average and tie in their long-term
order, policies etc. Our focus is to play the
provide a stable and inspired workplace loyalty, emerging as a stable users of their
role of a responsible citizen, serving as a
that enhances employee self-esteem and products.
role model.
emotional ownership. Our customers keep us in business
At Dwarikesh, we believe that the prudent
Our shareholders provided capital when through a consistent purchase of our
interplay of the value generated by each
we went into business. Our focus is to products, generating the financial
and our consistent payback ensures
generate free cash, growing ROCE and in resources to sustain our operations. Our
business sustainability and the ability to
doing so enhance value of their holdings. enhance organisational value.
794.34 602.78
45.30
Dwarikesh is a stable employer of more Dwarikesh is a responsible corporate Dwarikesh pays taxes in the geographies
than 711 permanent no-seasonal people citizen. of its presence, generates local
across locations (offices and factories). employment, complies with laws and
The Company is engaged in working
statutes and enriches the communities
The Company professes emotional at the grassroots through interventions
where it is present.
ownership among employees coupled in education, women’s empowerment,
with delegation, empowerment, trust agriculture, skill development, The Company generated C134.06 crore in
and accountability. environment, social awareness and foreign exchange earnings in 2019-20.
health.
The Company enjoys the respect of a
humane employer.
Substantial % of the Company’s
employees are rural, strengthening the
Company’s recall as a rural economy
driver.
123.50 1.26
50.52
Non-listed
1995-96 2005-06 2015-16 2019-20 1995-96 2005-06 2015-16 2019-20 2016-17 2017-18 2018-19 2019-20
Shareholder value Banker value Community
The Company strengthened shareholder The Company evoked trust among debt The Company enriched communities in
value through a complement of prudent providers to provide funds for asset the geographies of its presence through
business strategy, accrual reinvestment, creation and working capital. a complement of various programmes.
leveraging of its value chain, cost
management and share buyback.
The Company was quoted at a price-
earnings ratio of 3.90 based on a market
capitalisation of C312 crore as on 31st
March 2020 and a profit after tax of
C73.45 crore.
Annual Report 2019-20 27
The Dwarikesh business model
makes it a respected player in
the sugar industry
Business presence Quality revenues Cane management
The Company selected to The Company selected to focus on The Company conducts extensive
commission operations in the building a quality business, marked research in to cane varieties
sugarcane rich belt of Western by revenue visibility from large and new farming techniques
Uttar Pradesh through three and growing customers and no to enhance quality and yield.
factories. Uttar Pradesh is the payment defaults. Dwarikesh was the first company
largest sugarcane producing state to successfully introduce CO 0238
in India; its climatic condition is variety in its command areas. The
ideal for sugar cane cultivation. result: the Company crushed 22%
more cane than in the previous
season; 25% of the crushing
transpired in April and May 2020,
not necessarily the most recovery-
friendly months.
A sharp slowdown in economic growth performers among Asian peers, marked by During the last week of the financial year
and a surge in inflation weighed on a depreciation of nearly 2% since January under review, the national lockdown
the country’s currency rate; the Indian 2019. Retail inflation climbed to a six-year affected freight traffic, consumer offtake
rupee emerged as one of the worst high of 7.35% in December 2019. and a range of economic activities.
To factory
Press mud Juice defacation and clarification
Syrup boiling
Spent wash
Stream Molasses
Alcohol Fermentation Centrifuging
(Source: ISMA)
Government initiatives
yy The minimum selling price of sugar was yy Announcement of Maximum million tonnes – valid till July 2020
retained at C3,100 per quintal. However, Admissible Export Quota (MAEQ) of 6 yy Ethanol procurement prices remained
a higher MSP is warranted to prop the million tonnes and subsidy of C10,448 at C43.75 per litre in case of ethanol
flapping fortunes of the sugar industry per metric tonnes mills exporting made from C-Heavy molasses, C54.27
and increase their ability to clear sugar under the allotted quota. Quota per litre in case of ethanol made from
sugarcane dues of non-performing sugar mills was B-Heavy molasses and C59.48 in case of
yy Continuation of monthly release redistributed twice among sugar mills ethanol made directly from sugarcane
mechanism so as to regulate and who had conveyed their expression of juice
moderate the availability of sugar in the interest to export more
market yy Buffer stock subsidy on stock of 4
SWOT analysis
Molasses
Fuel Ethanol
99.5% pure
Alcohol vapour @
Water 50% concentration
Molasses
dilution
Alcohol Molecular
@ 95% sieve
beds
Fermenter
Analyzer Rectifier Polishing
Fermented Column Column Column
wash
Yeast 95% pure
cream Alcohol
Vapour Stream Vapour
Spent wash
Sugar
yy Marginal reduction in sugarcane crushed 0.93%
yy Small reduction in sugar production by 0.81%
yy Adjusted recovery higher than in FY2018-19
Cogeneration
yy Sold 1,632.79 lakh units worth C4,808 lakh vis-à-vis 2,020.28 lakh units worth C10,129 lakh in FY2018-19
Distillery
yy Sold 115.62 lakh litres of industrial alcohol worth C5,600 lakh vis-à-vis 90.17 lakh litres worth C3,632 lakh in FY2018-19
Accounting policies
The financial statements of the Company have been created in compliance with the requirements of the Companies Act, 2013 and
IND AS. The accounting policies followed by the Company form an integral part of the annual report.
business
40.68 40.35 12.29 12.28
Total production Total production Recovery rate Recovery rate
during 2018-19 during 2019-20 during 2018-19 (%) during 2019-20 (%)
(lakh quintals) (lakh quintals)
79 82
Contribution to Contribution to
total revenues total revenues
during 2018-19 (%) during 2019-20 (%)
Highlights, 2019-20
Crushed 328.07 lakh quintals Recovery was marginally lower at Enhanced adjusted recovery across
of cane, down from 331.16 lakh 12.28% compared to 12.29% in FY all plant thanks to an increasing
quintals in the previous year. 2018-19 (on account of the use of B acreage of early maturing cane,
Heavy molasses at one of its plants better logistics management and
resulting in lower sugar output but stringent quality control.
higher ethanol production). The
adjusted recovery is higher than in
the previous FY across all units.
Way ahead
The promise of normal monsoons and Company expects to engage deeper performance and accelerate the
government interventions in normalising with farmers, operate plants at optimal development of better cane varieties.
the sugar sector augur favourably. The capacity, strengthen its manufacturing
Our 36 56 27 24
distillery
Revenues earned Revenues earned EBITDA earned EBITDA earned
during 2018-19 (C during 2019-20 (C during 2018-19 (C during 2019-20 (C
crore) crore) crore) crore)
operations 90 116 40 48
Industrial alcohol Industrial alcohol Rate per litre Rate per litre
sold during 2018- sold during 2019- during 2018-19 (C) during 2019-20 (C)
19 (lakh litres) 20 (lakh litres)
Overview
Dwarikesh commissioned an ethanol During the year under review, Dwarikesh and effluent treatment equipment to take
blending facility at Dwarikesh Nagar enhanced its distillery capacity by 100 this business ahead.
in Bijnor (capacity 30 kilolitres per day) kilolitres per day (~3.75 crore litres
The expansion commenced production
in 2005 with the objective to provide of ethanol per year). Following the
in December 2019. The new plant will
ethanol to proximate oil manufacturing expansion, Dwarikesh is now empowered
focus on incinerating effluents generated,
companies. The Central Government’s to captively utilise all the molasses
extending operations to more than 315
ethanol blending programme is part of generated within after the mandatory
days a year, strengthening revenues.
a long-term direction to moderate the 18% has been sold, ensuring a compliance
cyclical impact of the sugar industry and with government guidelines. The
reduce the country’s dependence on Company installed best-in-class boilers
imported fuel.
65 58 18 15
Contribution Contribution Contribution to Contribution to
to total EBITDA to total EBITDA total revenues total revenues
during 2018-19 (%) during 2019-20 (%) during 2018-19 (%) during 2019-20 (%)
Overview
The Company extended into the business capacity of 6 megawatts (increased to stands at 91 megawatts, among the
of cogeneration when it commissioned 9 megawatts in 2002). The Company’s largest in Uttar Pradesh’s sugar industry.
its first power plant in 1996 with an initial cumulative cogeneration capacity now
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.
The Company prioritises women’s Sewa Jyoti organised awareness Sewa Jyoti introduced E-Shakti digitisation,
empowerment. SHG members were programmes for SHG members on micro bringing all SHGs onto a digital platform,
linked with micro-enterprise programmes insurance schemes run by the Government facilitating financial inclusion in Jhunjhunu
and banks. More than 170 SHG members of India, addressed by NABARD and bankers. district. NABARD sanctioned 200 SHG
commenced enterprises in dairying, Nearly 390 members benefitted digitisation projects to Sewa Jyoti
tailoring, petty shops, making pickled and
handicrafts, among others
Awards, 2019-20
Bhamashah Award in 2019 as District level Bhamashah award as Saraswati Ratna Award in 2019
Shiksha Vibhusan from the Shiksha Prerak in 2019 from Alliance Club International
Rajasthan Government
A number of manufacturers have started Dwarikesh’s environment focus environment issues and activities. The
recognising that financial upsides can only At Dwarikesh, we are not focused on Company organises training programmes
be achieved through sustainable practices matching government regulations; the to enhance employee awareness.The
that moderate resource depletion, water Company endeavours to stay ahead Company made proactive investments
scarcity, pollution, harmful impacts and through strategic investments, plantation to moderate its carbon footprint,
carbon footprint in addition to enhancing campaigns, cleanliness drives, effluents strengthening its long-term sustainability.
the safety of employees, community management and investments in cutting- During the year under review, the
and products. The manufacture of edge technologies. Company invested C21.56 crores in ‘green’
products through environment-friendly initiatives.
and economically-sound processes Environment
has become the primary goal in line The Company places an emphasis Sustainability initiatives,
with the United Nations’ sustainability on strengthening its commitment 2019-20
principles. The United Nations has to the environment. The Company During the commissioning of its 100 KLPD
outlined 10 principles for manufacturing developed environment cells in all three distillery plant, the Company moderated
with responsibility and environmental manufacturing units manned by the Unit environment impact. The Company
sustainability. Head, Group Compliance Officer and invested in the best technology for the
Manager (Environment). This cell monitors treatment of effluent and preservation
Benchmarks Achievements
Benchmark BOD of Treated Water ≤ 30 PPM BOD achieved < 20
Benchmark COD of Treated Water ≤ 250 PPM COD Achieved < 100
Benchmark Suspended Solids of Treated Water ≤ 30 PPM Suspended Solids Achieved < 30
5. The Members can join the AGM in the VC/OAVM mode 10. To support the ‘Green Initiative’, Members who have not yet
15 minutes before and after the scheduled time of the registered their email addresses are requested to register the
commencement of the Meeting by following the procedure same with their DPs in case the shares are held by them in
mentioned in the Notice. The facility of participation at the electronic form and with RTA in case the shares are held by
AGM through VC/OAVM will be made available to atleast them in physical form.
1000 members on first come first served basis. This will not 11. Members are requested to intimate changes, if any, pertaining
include large Shareholders (Shareholders holding 2% or more to their name, postal address, email address, telephone/mobile
shareholding), Promoters, Institutional Investors, Directors, numbers, Permanent Account Number (PAN), mandates,
Key Managerial Personnel, the Chairpersons of the Audit nominations, power of attorney, bank details such as, name
Committee, Nomination and Remuneration Committee and of the bank and branch details, bank account number, MICR
Stakeholders Relationship Committee, Auditors etc. who are code, IFSC code, etc., to their DPs in case the shares are held by
allowed to attend the AGM without restriction on account of them in electronic form and to RTA in case the shares are held
first come first served basis. by them in physical form.
(vii) If you are holding shares in demat form and had logged (xi) For shareholders holding shares in physical form,
on to www.evotingindia.com and voted on an earlier the details can be used only for e-voting on the
e-voting of any company, then your existing password resolutions contained in this Notice.
is to be used. (xii) Click on the EVSN for the relevant <Dwarikesh Sugar
(viii) If you are a first time user follow the steps given below: Industries Limited> on which you choose to vote.
(xiii) On the voting page, you will see “RESOLUTION
For Shareholders holding shares in
DESCRIPTION” and against the same the option
Demat Form and Physical Form
“YES/NO” for voting. Select the option YES or NO
PAN Enter your 10 digit alpha-numeric as desired. The option YES implies that you assent
*PAN issued by Income Tax to the Resolution and option NO implies that you
Department (Applicable for both dissent to the Resolution.
demat shareholders as well as physical
shareholders) (xiv) Click on the “RESOLUTIONS FILE LINK” if you wish to
view the entire Resolution details.
yy Shareholders who have not updated
their PAN with the Company/ (xv) After selecting the resolution you have decided to
Depository Participant are requested vote on, click on “SUBMIT”. A confirmation box will be
to use the sequence number which is displayed. If you wish to confirm your vote, click on
printed on Postal Ballot/Attendance “OK”, else to change your vote, click on “CANCEL” and
Slip indicated in the PAN Field. accordingly modify your vote.
(xvi) Once you “CONFIRM” your vote on the resolution,
you will not be allowed to modify your vote.
ANNEXURE TO NOTICE
EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013.
ITEM NO. 5 the Act, rules made thereunder and the Listing Regulations. The
Shri K. N. Prithviraj (DIN: 00115317) was appointed as an Company has received declarations from Shri K. N. Prithviraj that
Independent Director on the Board of the Company pursuant to he meets with the criteria of independence as prescribed both
the provisions of Section 149 of the Companies Act, 2013 read under sub-section (6) of Section 149 of the Act and under the
with the Companies (Appointment and Qualification of Directors) Listing Regulations.
Rules, 2014. He holds the office as an Independent Director of the As per the relevant provisions of the Companies Act, 2013. Shri K.
Company upto 18th September, 2020 (“first term” in line with the N. Prithviraj, Independent Director will attain the age of 75 years
explanation to Sections 149(10) and 149(11) of the Act). during March, 2022. In view of the acceptance by SEBI of Kotak
The Board, based on the performance evaluation of Independent Committee Recommendation in their Board Meeting held on 28th
Directors and as per the recommendation of the Nomination March, 2018 and also for an abundant precaution, the Company
& Remuneration Committee and considering his background, seeks consent of the members by way of special resolution for
experience and contributions made by him during his tenure, the continuation of his holding of existing office after the age of 75
continued association of Shri K. N. Prithviraj would be beneficial years during the pendency of his Second term of appointment till
to the Company and it is desirable to continue to avail his 17th September, 2025 under the provisions of Section 149 of the
services as an Independent Director. Accordingly, it is proposed Companies Act, 2013.
to re-appoint Shri K. N. Prithviraj as an Independent Director of The other details in terms of Regulation 26(4) and Regulation
the Company, not liable to retire by rotation and to hold office for 36 of SEBI (Listing Obligation and Disclosure Requirements)
a second term of five consecutive years. Regulations, 2015 and pursuant to Clause 1.2.5 of the Secretarial
In the opinion of the Board, Shri K. N. Prithviraj fulfil the conditions Standard on General Meetings (SS-2) of Directors seeking
for re-appointment as an Independent Director as specified in appointment/re-appointment, Shri K. N. Prithviraj, whose
Your Directors take pleasure in presenting their 26th (Twenty Sixth) Annual Report together with the Audited Accounts for the year
ended 31st March, 2020.
FINANCIAL RESULTS
(B in Lakhs)
Particulars Year Ended 31.03.2020 Year Ended 31.03.2019
Gross profit before depreciation, interest & tax 14,146.73 16,515.27
Less: Depreciation 3,686.56 3,294.99
Finance Costs 3,302.77 2,126.01
Profit/(Loss) before tax and exceptional items 7,157.40 11,094.27
Profit/(Loss) before tax 7,157.40 11,094.27
Tax expenses (188.01) 1,583.65
Profit/(Loss) after tax 7,345.41 9,510.62
Total comprehensive income/(loss) 6,550.93 9,778.35
DIVIDEND lock-downs of all economic activity. For the Company, the focus
Your Directors recommend payment of Preference dividend on 8% immediately shifted to ensuring the health and well-being of all
Cumulative Preference Shares (Series II) (falling due for repayment employees, and on minimizing disruption to services for all our
on 06th August, 2020) & payment of Interim equity dividend of customers. From a highly centralized model consisting of work
100% i.e B1/- per Equity Share of Face value of B1/- each. The spaces set in different locations capable of accommodating
outgo on account of Interim Equity dividend & Preference many employees, the switch to work from home for employees
Dividend (series II) upto the date of redemption including was carried out seamlessly to work remotely and securely. This
Dividend distribution tax (DDT) amounts to B24,31,82,733/-. response has reinforced customer and employee confidence
in DSIL and many of them have expressed their appreciation
In August 2020, at the time of redemption, an amount of
and gratitude for keeping their businesses running under most
B16,61,75,342/- along with dividend till redemption is payable
challenging conditions.
to preference shareholders of 8% Cumulative Preference Shares
(Series II). Although there are uncertainties, DSIL as always involved in public
service, started mass production of Sanitizers at a reasonable rate
TRANSFER TO RESERVES to serve the nation in these trying times. With it’s positive outlook,
During the year, there was no redemption of Preference Shares, innovative business model and work commitment even in these
hence no transfer to reserves is required on this account. uncertain time due to the pandemic, the Company is anticipating
to navigate the challenges ahead and gain better momentum in
YEAR IN RETROSPECT the near future.
Impact of Covid-19:
Operations:
In the last month of FY 2020, the COVID-19 pandemic developed
Distinguishing features of the crushing operations in your
rapidly into a global crisis, forcing governments to enforce
company are given in the succeeding paragraphs:
FY2019-20 (1.4.2019 to 31.3.2020), includes a minor part of SS 2018-19 and a major part of SS 2019-20 vis-à-vis
SS 2018-19 across three units
Particulars 2018-19 2019-20
Crushing (lakh Quintal) 306.84 336.66
Recovery % (combined) 12.31 12.30
Production (lakh Quintal) 37.77 41.11
For ongoing crushing season 2019-20 (up to 30th April 2020) vis-à-vis completed SS 2018-19
Highlights FY 2019-20
yy Sugarcane crushing marginally lower by 0.93%.
yy Recovery @ 12.28% as compared to recovery of 12.29% last FY. This recovery is after considering diversion of B heavy molasses at DN
plant. Adjusted recovery better than last FY.
yy Sugar production marginal down by 0.81%.
yy Impressive recovery on account better varietal mix, better logistics management & stringent quality control.
yy All units have clocked impressive recoveries.
yy Coveted position of highest group recovery in North India for SS 2019-20 is maintained by your company.
Performance of cogeneration division: Metrics of power sold:
Unit 2018-19 (01.04.2018 to 31.03.2019) 2 019-20 (01.04.2019 to 31.03.2020)
Power sold in lakhs units Amount in K/Lakhs Power sold in lakhs units Amount in K/Lakhs
DN 301.38 1,500 290.16 847
DP 675.73 3,392 651.57 1 ,922
DD 1,043.16 5,237 691.06 2 ,039
Total 2,020.27 10,129 1,632.79 4 ,808
Performance of Distillery: India. With consumption estimated at 176 million tons the deficit
During the year 130.10 lakh litres of industrial alcohol (previous FY is nearly 9 million tons. (Source: International Sugar organization).
66.67 lakh litres) was produced and 115.62 lakh litres of Industrial Brazil went on a overdrive in its ambitious ethanol blending
alcohol worth B5,600 lakh vis-à-vis 90.17 lakh litres worth B3,632 program and only 35% of the cane juice was used for making
lakh in FY 2018-19 was sold at the Dwarikesh Nagar unit. sugar while the rest was used for making ethanol.
The estimated deficit is also on account of estimated lower
A SUGAR INDUSTRY OVERVIEW
sugar production in all key geographies including Brazil, India
Global sugar industry scenario and Thailand. High price of crude during the major part of
Ongoing season of 2019-20 is expected to be yet another deficit season resulted in more sugarcane being diverted for ethanol
year with some estimates pegging the production number at manufacture in Brazil (65% for ethanol and the rest used for
167 million tons lower by almost 8 million tons as compared to making sugar). Beet sugar production in European Union is also
production during the previous season 2018-19. Production was lower than usual.
lower in all key sugar geographies including Brazil, Thailand &
Your Company has built strengths to manage the adversities. Your Company has been recording impressive recovery; its consistent
efficiency enhancement and cane development efforts have made it one of the most efficient & lowest cost sugar producers in
India. The company’s quest to integrate operations is now complete with the addition of a 100 KLPD distillery plant, thus maximizing
byproduct optimization and facilitating substantial value-addition. While the expenditure has been incurred, benefits will accrue in the
foreseeable future.
Your Company is also judiciously managing its debt profile. All term debts are at subsidized rate of interest. Your Company endeavors to
minimize interest outflow. Increase in working capital loans is inevitable as the company is under compulsion to carry larger inventory.
yy There is significant improvement in the revenue from operations have been much lesser but for the fact that the Company was
during the year under review. The same is attributable to the compelled to carry higher inventory under monthly release
increased releases under the monthly release mechanism mechanism and therefore its working capital requirement was
administered by the Central Government. higher. The company has also had the benefit of lower rate of
yy EBIDTA, during FY 2019-20 is B14,147 lakhs as compared to interest on account of its improved credit rating. The long term
B16,515 lakhs earned during previous FY. Lower EBIDT both loans of the company are rated ‘A+’ with stable outlook and
in absolute terms as well as % terms is mainly attributable to Commercial paper program (short term) has been accorded
the reduction in power tariff with effective from 1st April, 2019. the highest rating of ‘A1+’ by ICRA.
Reduction in power tariff was steep and more than 40%.
CANE & SUGAR POLICY
yy During the year under review your company earned EBDTA The main policies of the government in relation to the sugar
of B10,844 lakhs as compared to B14,389 lakhs earned in the industry during the year were:
previous FY.
a. Hitherto applicable levy and free sale sugar ratio of 10:90 for
yy Earning before tax is at B7,157 lakhs when viewed in
the period up to 31st March, 2013 has since been abolished
conjunction with that of the previous FY (B11094 lakhs).
pursuant to adoption of recommendations contained in the
yy Earnings after tax at B7,345 lakhs is as compared to the report of Dr. Rangarajan. The sugar mills are now eligible to sell
earnings after tax of previous FY of B9,511 lakhs. their entire production as free sale sugar.
Salient features: b. The Fair & Remunerative Price (FRP) for the crushing season
yy Sugar prices were range bound throughout the year. 2017-18 was B255 per quintal which has been increased to
yy During the year under review your company exported a part B275 per quintal for 2018-19, where the season 2017-18 was
of its balance contracted export obligation under the MIEQ of linked to recovery @ 9.50% and the season 2018-19 is linked to
2018-19 and a part of the quantity contracted under MAEQ recovery rate @ 10%.
2019-20. All sugar exported thus far has been raw sugar.
c. Chronology of SMP/FRP announced by the Central
yy Your company has embarked upon project of distillery Government on the basis of recovery is given hereinunder:
expansion, the benefits of which will start accruing on full year
basis during FY 2020-21. Season SMP/F&RP H/
yy Your company strives to raise the bar of efficiency continuously. Quintal
The benchmark numbers of recoveries/process losses 2000-01(SMP) 59.50*
challenged season after season with a view to better the 2001-02 62.05*
previous benchmarks and set the new ones. In an industry 2002-03 64.50*
where most factors are beyond the realm of company’s control,
2002-03 (Revised) 69.50*
your company strives to ruthlessly attack costs and keep the
same under control. 2003-04 73.00*
yy Another area of focus for your Company has been to rein in 2004-05 74.50*
the interest costs. Its aggressive policy of accelerated debt 2005-06 79.50&
repayment has paid dividends and the company squared up 2006-07 80.25&
all its earlier debts. The long term debts presently carried in the
2007-08 81.18&
Company’s books are at subsidized rates. Interest outgo would
Details of the CSR policy are available on our 2. Stakeholders’ Relationship Committee
website at http://www.dwarikesh.com/pdf/2018/ 3. Nomination and Remuneration Committee
Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties
referred to in sub-section (1) of Section 188 of the Companies Act, 2013 including certain arms-length transactions
under third proviso thereto
(a) Name(s) of the related party and nature of Morarka Finance Limited
relationship
(b) Nature of contracts/arrangements/transactions Lease of office premises
(c) Duration of the contracts arrangements/transactions Five years
(d) Salient terms of the contracts or arrangements or For company’s Mumbai based corporate office, the premises
transactions including the value, if any: of related party – Morarka Finance is taken on Leave & License
for five years, rent of B18,28,764/- paid for the year ended 31st
March, 2020 with clause of increasing the same at an interval
of 1 year.
(e) Date(s) of approval by the Board, if any:
(f ) Amount paid as advances, if any: Nil
(a) Name(s) of the related party and nature of relationship Morarka Finance Limited
(b) Nature of contracts/arrangements/ transactions Management consultancy services
(c) Duration of the contracts arrangements/transactions --
(d) Salient terms of the contracts or arrangements or To assist the company in corporate advisory services,
transactions including the value, if any: arrangement of finance from other banks, NBFCs, financial
institutes, NBFIs etc at the fees of B46,02,000/- paid for the year
ended 31st March, 2020.
(e) Date(s) of approval by the Board, if any:
(f ) Amount paid as advances, if any: Nil
(a) Name(s) of the related party and nature of Dwarikesh Trading Company Limited
relationship
(b) Nature of contracts/arrangements/transactions Lease of premises
(c) Duration of the contracts arrangements/transactions
(d) Salient terms of the contracts or arrangements or For company’s Mumbai based operations, the premises of related
transactions including the value, if any: party – Dwarikesh Trading Co Ltd is taken on Leave & License,
rent of B80,28,720/- paid for the year ended 31st March, 2020 with
clause of increasing the same at an interval of 1 year.
(e) Date(s) of approval by the Board, if any:
(f ) Amount paid as advances, if any: Nil
(a) Name(s) of the related party and nature of Dwarikesh Trading Company Limited
relationship
(b) Nature of contracts/arrangements/transactions Lease of premises
(c) Duration of the contracts arrangements/transactions
(a) Name(s) of the related party and nature of Dwarikesh Informatics Limited
relationship
(b) Nature of contracts/arrangements/transactions Website updates and maintenance
(c) Duration of the contracts arrangements/transactions
(d) Salient terms of the contracts or arrangements or Company’s website www.dwarikesh.com being maintained
transactions including the value, if any: and updated with regular updates pertaining to company’s
operations and other shareholders information and regulatory
updates at B40,71,000/- for the year ended 31st March, 2020.
(e) Date(s) of approval by the Board, if any:
(f ) Amount paid as advances, if any: Nil
(a) Name(s) of the related party and nature of relationship Priyanka G. Morarka
(b) Nature of Contracts/arrangements/transactions Appointment and remuneration as Vice President - Corporate
Affairs
(c) Duration of the contracts arrangements/transactions -
(d) Salient terms of the contracts or arrangements or She has been appointed as Vice President - Corporate Affairs
transactions including the value, if any: at the remuneration of B35,71,947/- (excluding Company’s
contribution to PF B1,85,328) paid for the year ended 31st March,
2020.
(e) Date(s) of approval by the Board, if any:
(f ) Amount paid as advances, if any: Nil
(f ) Amount paid as advances, if any: Nil
(a) Name(s) of the related party and nature of R R Morarka Charitable Trust
relationship
(b)Nature of contracts/arrangements/transactions Construction/Acquisition of Assets
(c) Duration of the contracts arrangements/transactions --
(d) Salient terms of the contracts or arrangements or For construction/acquisition of assets or for any other activity
transactions including the value, if any: company has paid B2,44,99,822/- for the year ended 31st March,
2020.
(e) Date(s) of approval by the Board, if any:
(f ) Amount paid as advances, if any: Nil
(f ) Amount paid as advances, if any: Nil
A) Details of the ratio of the remuneration of each director to the median employee’s remuneration and
other details as required pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 is given below:
Name of Director Designation Ratio to median employees remuneration
Shri G. R. Morarka Executive Chairman 95:67:1
Shri Vijay S. Banka Managing Director 29.96:1
Shri B. J. Maheshwari Managing Director & CS cum CCO 29.86:1
Shri B. K. Agarwal Independent Director 1.21:1
Shri K. N. Prithviraj Independent Director 0.68:1
Ms. Nina Chatrath Independent Director 0.82:1
Remuneration includes all remuneration excluding exempt allowances under Income Tax Act & Company’s Contribution to PF & PF
administration & EDLI charges.
a) Percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer and Company Secretary in the
financial year 2019-20:
b) Percentage increase in median remuneration of employee in remuneration for that year which, in the aggregate, was not
the financial year 2019-20: less than One crore & twenty lakh rupees; 3 (Shri Gautam
R. Morarka, Executive Chairman, Shri Vijay S. Banka,
There is increase of 4.84% in median remuneration of employee
Managing Director & Shri B. J. Maheshwari, Managing
during the current accounting year of 12 months over the
Director & CS cum CCO).
previous accounting period consisting of 12 months. The
increase looks marginal on account of various reasons such as yy If employed for a part of the financial year, was in receipt of
induction of new employees, confirmation of employees from remuneration for any part of that year, at a rate which, in the
wage board to management grade etc. aggregate, was not less than Eight lakh fifty thousand rupees
per month: Not Applicable.
c) Permanent employees:
yy If employed throughout the financial year or part thereof, was
As on 31st March, 2020, the Company has on its payroll 711 in receipt of remuneration in that year which, in the aggregate,
permanent employees excluding seasonal employees. or as the case may be, at a rate which, in the aggregate, is in
excess of that drawn by the managing director or whole-time
d) Affirmation that the remuneration is as per the remuneration
director or manager and holds by himself or along with his
policy of the Company:
spouse and dependent children, not less than two percent of
Remuneration paid to Managing Director & Whole Time Director the equity shares of the company: NIL
is as per approved policy of the Company. B. Average percentile increase already made in the salaries of
A. Statement showing the name of every employee of the employees other than the managerial personnel in the last
company, who- financial year and its comparison with the percentile increase in
Notes:
1. The programs and projects identified are restricted not only to manufacturing state of the company but also to other state.
2. The Company spends the amounts allocated for CSR activities either by itself or through its implementing agency R R Morarka Charitable Trust or
Manotsav Foundation.
3. In case the Company has failed to spend the two per cent of the average net profit of the last three financial years or any part thereof, the Company
shall provide the reasons for not spending the amount in its Board report: Not Applicable.
A responsibility statement of the CSR Committee: The Committee confirms that the implementation and monitoring of CSR Policy, is in compliance with
CSR objectives and Policy of the Company.
On behalf of the Board of Director
B. J. Maheshwari Vijay S. Banka
Place : Mumbai Managing Director & CS cum CCO Managing Director
Date : 10th June, 2020 (DIN-00002075) (DIN -00963355)
CORPORATE GOVERNANCE
REPORT
Introduction: Corporate Governance is the mechanism by which justice to vendors, employees and the society at large are the
the values, principles, management policies and procedures of a cardinal principles of Corporate Governance for your Company”
corporation are made manifest in the real world. It contemplates
A Report on compliance with the principles of Corporate
fairness, transparency, accountability and responsibility in the
Governance as prescribed by The Securities and Exchange Board
functioning of the Management and the Board of Companies.
of India (SEBI) in Chapter IV read with Schedule V of SEBI (Listing
Corporate Governance is based on preserving core beliefs and
Obligations and Disclosure Requirements) Regulations, 2015, as
ethical business conduct while maintaining a strong commitment
amended from time to time (hereinafter referred to as “Listing
to maximize long-term stakeholder value.
Regulations”) is given below:
1. COMPANY’S PHILOSOPHY ON CORPORATE
2. BOARD OF DIRECTORS
GOVERNANCE
Your Company has implemented and continuously tries to Composition of Board of Directors and Category:
improve the Corporate Governance Practices with an attempt In compliance with provision of Companies Act, 2013, as
to meet stakeholders’ expectations’ and Company’s societal amended from time to time (hereinafter referred to as “the
commitments through high standards of ethics, sound Act”) and Regulation 17 of Listing Regulations, the Board has an
business decisions, prudent financial management practices, optimum combination of Executive and Non-Executive Directors
professionalism in decision making and conducting the business with an Executive Chairman and not less than half of the Board
and finally with strict compliance of regulatory guidelines on comprising of Non-Executive Independent Director including
Corporate Governance. woman Independent Director to maintain the independence of
the Board.
“Transparency, honesty, efficiency, complete and timely
disclosure and sustained enhancement of shareholders value,
Name of the Director Category No. of other No of No of Board No. of Equity shares
Directorship @ membership Committee for held
of other Board which Chairman@
committee@
Shri G. R. Morarka Executive Chairman 4 1 – 2,85,66,590
(Whole Time Director)
Shri B. K. Agarwal Non-Executive – – – –
Independent Director
Shri K. N. Prithviraj Non-Executive 3 - – –
Independent Director
Ms. Nina Chatrath Non-Executive 2 – – –
Independent Director
Shri B. J. Maheshwari Managing Director 3 - 2 –
Shri Vijay S. Banka Managing Director 2 2 – –
@In accordance with Listing Regulations, directorships of only public limited companies have been considered. The directorships in Section 8 companies and
private companies have been excluded. Further, memberships & chairmanships of only Audit committee and Stakeholders Relationship Committee of all Public
Limited Companies (excluding Dwarikesh Sugar Industries Limited) have been considered.
d) to review and monitor the Auditor’s independence and B. NOMINATION AND REMUNERATION COMMITTEE
performance, effectiveness of the audit process; In terms of Section 178 of the Act and Regulation 19 of the Listing
Regulations, the Nomination & Remuneration Committee was
e) approval or any subsequent modification of the transactions
formed on 22nd October, 2001 comprising of three members as
of the company with related parties;
Independent Directors, including its Chairman, namely Shri K. N.
f ) to scrutinize inter corporate loans and investments; Prithviraj (Chairman of the Committee).
g) valuation of undertakings or assets of the company, wherever Shri B. J. Maheshwari, the Company Secretary of the Company
it is necessary; acts as the Secretary to the Committee.
h) to evaluate the Internal Financial Controls and Risk Terms of Reference:
Management System; The terms of reference of the Nomination and Remuneration
i) to monitor the end use of funds raised through public offers Committee are in line with the regulatory requirements mandated
and related matters. in the Act and Part D of Schedule II of the Listing Regulations,
which are as follows:
The Committee also reviews the observations of the Internal and
Statutory Auditors, along with the comments and action taken yy to formulate criteria for determining qualifications, positive
thereon by the Management and invites senior executives to its attributes and independence of a director;
Meetings as necessary. yy to recommend the Board a policy, relating to the remuneration
of the Directors, Key Managerial personnel and other
employees;
yy to formulate the criteria for evaluation of Independent
Directors and the Board;
yy to devise a policy on Board diversity;
yy to identify persons who are qualified to become directors and
who may be appointed in senior management in accordance
with the criteria laid down, and recommend to the Board their
appointment and removal, etc.
The manner in which the annual performance evaluation is done 6. To approve share transfers and/or delegation thereof.
by the Board including the criteria for the same is discussed in The Stakeholders Relationship Committee are also required to
detail in Directors Report. submit their reports/suggestions to the Board of Directors of the
Company from time to time.
C. STAKEHOLDERS RELATIONSHIP COMMITTEE
In terms of Section 178 of the Act and Regulation 20 of the Meeting and Attendance
Listing Regulations, Stakeholders’ Relationship Committee was During the year ended 31st March, 2019, Four (4) Stakeholder and
constituted on 17th March, 2001 to oversee the matters relating Relationship committee meetings was held on 23rd May, 2019,
to redressal of Stakeholder complaints pertaining to issue of 05th August, 2019, 07th November, 2019 & 10th February,
duplicate shares, transfer of shares, non-receipt of Annual Report, 2020.
non- receipt of declared dividends etc.
Name of the Directors No. of meeting attended
It consists of five members, out of which three are Independent
Director, including the Chairman of the Committee, namely Shri Shri B. K. Agarwal 4
B. K. Agarwal and two Executive Director of the Company. Shri Vijay S. Banka 4
Name of the Directors No. of meeting attended 1. In the Board Meeting held on 07th May, 2018 Shri B. J.
Maheshwari & Shri Vijay S. Banka had been re-designated from
Shri B. K. Agarwal 4
Whole Time Directors to Managing Directors of the Company
Shri Vijay S. Banka 4 for residual period of 3 years, i.e, till 30th April, 2021.
Shri B. J. Maheshwari 4
2. Shri Gautam R. Morarka is appointed for a period of 3 years
Shri G. R. Morarka 4 from the date of his appointment, subject to members’
Shri K. N. Prithviraj 3 approval.
The details of CSR initiatives undertaken by the Company are
provided in the CSR Report annexed to the Directors Report.
B. NON-EXECUTIVE DIRECTORS:
(Bin lakhs)
Name of the Director Sitting fees Commission Payable Total Payments paid/Payable in 2019-20
Shri B. K. Agarwal 4.60 --- 4.60
Shri K. N. Prithviraj 2.60 --- 2.60
Ms. Nina Chatrath 3.10 --- 3.10
1. Shri B. K Agarwal, Shri K. N Prithviraj & Ms. Nina Chatrath, Independent Non-Executive Directors of the Company, have a term of
appointment of five years.
2. They were paid sitting fees of B50,000 for attending every meeting of Board of Directors of the Company and B10,000 for attending
every Committee Meeting of the Company.
3. None of the Non-Executive Directors of the Company had any pecuniary relationship or transactions vis- à-vis the Company.
Notes:
1. There is no notice period for Directors of the Company.
2. No stock options have been granted to any directors of the Company.
3. Severance fees is Nil.
4. For Executive Directors of the Company,Performance Pay is the only component of remuneration that is performance-linked. All other
components are fixed.
6. MEANS OF COMMUNICATION
Quarterly Results: The Company’s quarterly results as prescribed by the Stock Exchanges pursuant to Regulation 33, 47 of the Listing
Regulations are approved and taken on record by the Board within the prescribed time frame, and sent forthwith to all Stock Exchanges
on which the Company’s shares are listed. These results are being published in leading newspapers i.e. Business Standard for English
and Shah times for Hindi.
Website: As per the requirements of Regulation 47 of the Listing Regulations, all the data related to quarterly financial results,
shareholding pattern, presentation made to institutional investors or to the analysts etc. is filed with stock exchanges and also displayed
on the Company’s website: (www.dwarikesh.com) within the time prescribed in this regard. The Company’s website also displays the
official news releases.
Annual Report: Annual Report containing, inter alia, Audited Annual Accounts, Financial Statements, Directors’ Report, Auditors’ Report
and other important information is circulated to members and others entitled thereto. The Management Discussion and Analysis
(MD&A) Report forms part of the Annual Report.
Payment of Listing Fees: Annual listing fee for the year 2020-21 (as applicable) has been paid by the Company to BSE & NSE.
NSE BSE
Month High Low Total Volume High Low Total Volume
B B Quantity No B B Quantity No
Apr-19 31.55 27.10 1,26,24,277 31.50 27.15 15,24,409
May-19 30.95 24.65 1,40,31,584 31.00 24.00 19,43,110
Jun-19 29.40 24.25 68,57,039 29.40 23.90 9,11,154
Jul-19 27.70 21.00 66,01,626 27.20 21.15 8,23,400
Aug-19 24.50 19.25 87,35,536 25.40 19.50 10,96,989
Sep-19 27.35 21.40 1,30,81,396 27.30 21.40 15,32,413
Oct-19 27.25 23.35 72,18,461 27.10 23.45 7,35,871
Nov-19 28.50 23.90 82,07,666 28.45 23.85 6,67,881
Dec-19 34.00 23.15 2,44,96,236 33.95 23.50 17,97,505
Jan-20 42.00 33.20 6,91,01,632 42.05 33.15 53,72,157
Feb-20 39.35 27.80 2,99,55,073 39.35 28.00 30,18,234
Mar-20 29.85 13.35 2,39,86,263 29.90 13.30 1,03,59,085
STOCK PERFORMANCE:
DSIL SHARE PRICES NSE & CNX NIFTY DSIL SHARE PRICES NSE & CNX NIFTY
50 42500 50 13000
42273.87 12430.50
41809.96
41709.3
41163.79 12158.80 12293.90 12246.70
12041.15 12103.0511981.75 11945.00
12000
42.05 11856.15 42.05
DSIL share price in C
40392.22 11694.85
40312.07
40 40124.96 39.46 40000 40 39.46 11433.00
BSE SENSEX
11180.45
39487.45 11000
38441.12
CNX Nifty
39083.17
33.95 33.95
31.50 31.50
10000
31.00 37807.55 31.00
30 29.90 37500 30 29.90
29.40 29.40
28.45 28.45
27.20 27.30 27.10 27.20 27.30 27.10
9000
25.40 25.40
20 35000 20 8000
Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20
We have examined and verified the records of the Board of Number L15421UP1993PLC018642 on 01st November, 1993
Directors available and maintained on the online portal of under the jurisdiction of Registrar of Companies, Kanpur.
Ministry of Corporate Affairs of DWARIKESH SUGAR INDUSTRIES
On the basis of examination and verification, we hereby state
LIMITED (hereinafter will be known as “the Company”),
that none of the directors on the board of the company have been
having its Registered Office at Dwarikesh Nagar, Bijnore, Uttar
debarred or disqualified from being appointed or continuing as the
Pradesh-246762 India incorporated vide its Company Registration
directors of companies by the Securities Exchange Board of India/
MCA or any such statutory authority.
The Board of Directors of the Company comprises of 6 (Six) Directors and the Board is composed as follows:
Sr. Name of the Director DIN Type of the Director Date of Status of the
No Appointment Director
1 Shri Balkumar Agarwal 00001085 Independent Director 19/09/2015 Active
2 Shri Balkishan J. 00002075 Managing Director (Executive Director) 07/05/2018 Active
Maheshwari
3 Shri Gautam R. Morarka 00002078 Executive Director 01/01/2019 Active
4 Shri Prithviraj Kokkarne 00115317 Independent Director 19/09/2015 Active
5 Shri Vijay S. Banka 00963355 Managing Director (Executive Director) 07/05/2018 Active
6 Ms. Nina Chatrath 07700943 Independent Director 04/02/2017 Active
This Certificate is being issued at the request of the Company for the rightful compliance with Para 3(x)(c)(iii) of SEBI (Listing Obligations
and Disclosure Requirements) (Amendment) Regulations, 2018
1. Conservation of Energy
Energy conservation is an on-going activity in the Company and the efforts to conserve energy through improved operational methods
and other means are continuing. Details of total energy consumption and energy consumption per unit of production are furnished in
the prescribed Form ‘A’ below.
FORM ‘A’
Form for Disclosure of Particulars with Respect to Conservation of Energy
A. POWER AND FUEL CONSUMPTION
Particulars Standards (if any) Current Year 2019-20 Previous Year 2018-19
Electricity (KWH)® N.A. – –
Furnace Oil ®N.A. – –
Coal (Specify Qua) N.A. – –
Others (Specify) N.A. – –
Firewood (MT) N.A. – –
G.N. Husk (MT) N.A. – –
Bagasse (MT) 0.23 MT/Qtl of Sugar 0.24 MT/Qtl of Sugar
2. Steps taken by the Company for utilizing alternate sources of energy: The Company is producing renewable energy from
Bagasse, which is eco-friendly & meets it’s captive requirement of power from such energy & sells surplus power to state Grid.
3. Capital Investment on energy conservation equipment: NIL
TECHNOLOGY ABSORPTION
FORM ‘B’
Form for Disclosure of Particulars in Respect of Technology Absorption
I Research and Development: information on website of the company as well as through SIS,
A. FOCUS AREA SMS and mobile app on mobiles of the cane suppliers.
4. Focus on construction of link roads for easy and smooth 8. Online weighment of cane at out cane purchasing centres
transportation of sugar cane at mills gate as well as at out through HHC, Challan Generation to the trucks from outcentres
centres, to facilitate sugarcane suppliers as well as cane through HHC has helped in smooth and transparent working.
transporters with a view to reduce cane transportation cost.
3. The Depositories Act, 1996 and the Regulations and Bye-laws 6. Other Laws applicable to the Company;
framed hereunder;
i. The Factories Act,1948.
4. Foreign Exchange Management Act, 1999 and the rules and
ii. The Payment of Wages Act,1936.
regulations made there under to the extent of Foreign Direct
Investment and Overseas Direct Investment; iii. The Minimum Wages Act,1948.
5. The following Regulations and Guidelines prescribed under iv. The Employee Provident Fund and Miscellaneous
the Securities and Exchange Board of India, 1992 (SEBI Act); Provisions Act,1952.
v. The Payment of Gratuity Act,1972.
We further report that: - We further report that there are adequate systems and
processes in the Company, commensurate with the size and
yy The Board of Directors of the Company is duly constituted with operations of the Company to monitor and ensure compliance
proper balance of Executive Directors, Non-Executive Directors with applicable laws, rules, regulations and guidelines.
and Independent Directors. During the year under review
Note: This report is to be read with our letter of even date which is annexed as “ANNEXURE A” and forms an integral part if this report.
S. Questions P1 P2 P3 P4 P6 P7 P8 P9
No
1 Do you have a policy/policies for.... Y Y Y Y N Y Y Y
2 Has the policy being formulated in consultation with the relevant Y Y Y Y N Y Y Y
stakeholders?
3 Does the policy conform to any national/international standards? Y Y Y Y N Y Y Y
4 Has the policy being approved by the Board? If yes, has it been signed by Y Y Y Y N Y Y Y
MD/owner/CEO/appropriate Board Director?
2a. If answer to S. No. 1 against any principle, is ‘No’, please explain why: (Tick up to 2 options)
S. Questions P1 P2 P3 P4 P6 P7 P8 P9
No
1 The company has not understood the Principles
2 The company is not at a stage where it finds itself in a position to
formulate and implement the policies on specified principles
3 The company does not have financial or manpower resources available
for the task
4 It is planned to be done within next 6 months √
5 It is planned to be done within the next 1 year
6 Any other reason (please specify)
3 Governance related to BR
a) Indicate the frequency with which the Board of Directors, Committee of the Board or CEO to assess the BR performance of the
Company. Within 3 months, 3-6 months, Annually, More than 1 year?
Four Board Meetings were held during the year.
b) Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How frequently it is
published?
Yes, the company publishes its Sustainability Report annually. In FY 2020, the Sustainability Report is part of this Annual Report.
PRINCIPLE 1
1. Does the policy relating to ethics, bribery and corruption cover only the company?
No
PRINCIPLE 2
1 List up to 3 of your products or services whose design has incorporated social or environmental concerns, risks and/or
opportunities.
i. Sugar - Our sugar grades are L-31, M-31, S-31, L-30, M-30 and S-30, of which maximum production is of 31 colour sugar. (31 is the
best colour standard fixed by the Government of India). Sugar grading is done for colour and grain size and the sugar produced
at our units is regularly matched with N.S.I. standards. We maintain the percentage retention of our sugar at 85%+ as against
minimum requirement of 70%.
ii Ethanol and Industrial Alcohol -Molasses is a bye product generated in manufacture of sugar .Molasses becomes raw material
for manufacture of Industrial alcohol & ethanol. Ethanol is procured by Oil Marketing Companies (OMC) for blending with petrol.
It’s Central Government’s policy to permit blending of ethanol with Petrol upto 10% . Ethanol is eco-friendly fuel & use of ethanol
saves precious foreign exchange of the nation by reducing import of crude oil.
iii Power-Company generates power from the sugar cane residue viz Bagasse. The power is used for captive consumption as well as
surplus power is sold to Uttar Pradesh Power Corporation (UPPCL), Company has entered into agreement with UPPCL for export
of 56MW.
2 For each such product, provide the following details in respect of resource use (energy, water, raw material etc.) per unit of
product(optional):
i. Reduction during sourcing/production/distribution achieved since the previous year throughout the value chain?
ii. Reduction during usage by consumers (energy, water) has been achieved since the previous year?
3. Does the company have procedures in place for sustainable sourcing (including transportation)?
i. If yes, what percentage of your inputs was sourced sustainably? Also, provide details thereof, in about 50 words or so.
We are procuring sugar cane from farmers around 50 to 70 % of sugarcane is delivered at mill gate & brought by farmers by their
own transportation viz tractor trolleys. The Company arranges for pickup of the balance sugar cane at centres close the farmers
villages to facilitate them to offload their sugarcane & the company arranges for transportation of sugar cane from these centres
to mills by it’s own transportation.
4 Has the company taken any steps to procure goods and services from local & small producers, including communities
surrounding their place of work? If yes, what steps have been taken to improve their capacity and capability of local and small
vendors?
The Company procures sugarcane from thousands of farmers from the neighbouring area of the sugar mills . We are interacting with
them through SMS & other communications for updating them with various information for updating their knowledge. We make
model fields & educate the farmers to learn the best farming practices. We provide seeds to farmers for planting sugar cane, We
provide pesticides to farmers at competitive rates to fight against diseases.
5. Does the company have a mechanism to recycle products and waste? If yes what is the percentage of recycling of products and
waste (separately as 10%). Also, provide details thereof, in about 50 words or so.
Yes. For more details refer Operations and Performances which forms part of this Annual Report and also on the weblink: https://
www.dwarikesh.com/captive.html
PRINCIPLE 4
1 Has the company mapped its internal and external stakeholders? Yes
2 Out of the above, has the company identified the disadvantaged, vulnerable & marginalized stakeholders. Yes
3 Are there any special initiatives taken by the company to engage with the disadvantaged, vulnerable and marginalized
stakeholders. If so, provide details thereof, in about 50 words or so.
Yes. Please refer the CSR policy of the Company attached in this Annual Report and also more details are provided at: https://www.
dwarikesh.com/farmers.html
4 Does the company have any project related to Clean 4 What is your company’s direct contribution to community
Development Mechanism? If so, provide details thereof, in development projects Amount in INR and the details of the
about 50 words or so. Also, if Yes, whether any environmental projects undertaken.
compliance report is filed? Dwarikesh Group strongly believes that “Businesses cannot be
Not Applicable successful when the society around them fails.”
DSIL has always tried to contribute to the development of our
5 Has the company undertaken any other initiatives on – society employing all the resources we can. The DSIL Group‘s
clean technology, energy efficiency, renewable energy, etc. definition of Corporate Social Responsibility. “CSR is integral
Y/N. If yes, please give hyperlink for web page etc. to the business model of Dwarikesh Sugar Industries Ltd.
Yes. Kindly refer our products page at weblink: https://www. through R R Morarka Charitable Trust, Narbada Devi Charitable
dwarikesh.com/captive.html Trust, Sewa Jyoti and its business unit CSR programs, ‘DSIL’
serves as a catalyst for development in the communities it
6 Are the Emissions/Waste generated by the company within
operates in. DSIL serves as catalyst because it’s like a substance
the permissible limits given by CPCB/SPCB for the financial
that causes quick change or development in the community
year being reported?
where they operate. The development explains not just about
Yes
economic or financial development but also the development
DSIL and supporting NGO SEWAJYOTI is working exactly as a Yes. Initiatives conducted under CSR are tracked to determine
flame of service spreading light of hope and happiness among the outcomes achieved and the benefits to the community.
those who are not in a position to meet their basic needs such Internal tracking mechanisms, monthly reports and follow-up
as food, education, self-employment, shelter and medical aid field visits, telephonic and email communications are regularly
etc. The Rajasthan Government has FIVE times recognized our carried out. The company has engaged highly trained
services to the society and has generously bestowed upon employees to drive and monitor the CSR activities.
our chief trustee the highly prestigious BHAMASHAH AWARD
in 2006, 2011, 2016, 2018 and 2019 and SHIKSHA BHUSHAN PRINCIPLE 9
AWARDS – 2018 and SHIKSHA VIBHUSHAN AWARD - 2019 for 1 What percentage of customer complaints/consumer cases
a keen contribution to the cause of social development and are pending as on the end of financial year.
expressed our commitment to work in the fields of education, Nil
Infrastructure development, health, women empowerment 2 Does the company display product information on the
through employment generation, agriculture and industrial product label, over and above what is mandated as per
development. local laws? Yes/No/N.A./Remarks(additional information)
(A) DSIL Activities No
I To combat COVID-19 - As a part of its Corporate Social 3 Is there any case filed by any stakeholder against the
Responsibility initiatives, DSIL has incurred following amounts: company regarding unfair trade practices, irresponsible
i One day salary of employees deducted from March 2020 advertising and/or anti-competitive behaviour during the
salary and deposited to PM for PM Cares in April 2020 last five years and pending as on end of financial year. If so,
– B10,70,383 provide details thereof, in about 50 words or so?
No
ii Donation given to:
4 Did your company carry out any consumer survey/
a PM Cares – B51,00,000 on 06.04.2020 consumer satisfaction trends?
• UP COVID Care – B30,00,000 on 13.04.2020 (10 lakhs No
each from all three units)
S. Name and Description of main products/ NIC Code of the Product/service % to total turnover of the company
No. services
1 Manufacture and refining of Sugar from 10721 86.15
sugarcane
C. Shares held by
Custodian
for GDRs & ADRs
Grand Total 18,80,30,590 2,70,880 18,83,01,470 100 18,80,43,020 2,58,450 18,83,01,470 100 –
(A+B+C)
B) Shareholding of Promoter-
SN Shareholder’s Name Shareholding at the beginning of the Shareholding at the end of the year % change in
year shareholding
during the
No. of Shares % of total %of Shares No. of Shares % of total %of Shares year
Shares Pledged/ Shares Pledged/
of the encumbered of the encumbered
company to total company to total
shares shares
1 Shri Gautam R. Morarka 2,82,66,590 15.01 – 2,85,66,590 15.17 – 0.16
2 Shri Pranay Gautam Morarka 12,49,710 0.66 – 12,49,710 0.66 – –
3 Ms. Priyanka G. Morarka 5,12,360 0.27 – 5,12,360 0.27 – –
4 Smt. S. G. Morarka 9,01,780 0.48 – 10,01,780 0.53 – 0.05
5 Dwarikesh Trading Co. Ltd 2,62,48,890 13.94 – 2,62,48,890 13.94 – –
6 Morarka Finance Limited 2,15,91,180 11.47 – 2,15,91,180 11.47 – –
7 Gautam Morarka- Karta – 63,000 0.03 – 63,000 0.03 – –
C/o Gautam R. Morarka HUF
SN For Each of the Top 10 Shareholders Shareholding at the beginning of the Shareholding at the end of the year
year (31.03.2019) (31.03.2020)
No. of shares % of total shares No. of shares % of total shares
of the company of the company
1. ANIL KUMAR GOEL 78,20,000 4.15 82,00,000 4.35
2. DSP SMALL CAP FUND 49,78,525 2.64 62,61,017 3.32
3. SEEMA GOEL 37,20,000 1.98 38,30,000 2.03
4. RAJESH NUWAL - - 30,00,000 1.59
5. PREMIER CREDIT CAPITAL LIMITED 17,53,890 0.93 21,67,394 1.15
6. VISHANJI SHAMJI DEDHIA 7,75,000 0.41 11,50,000 0.61
7. SANJAY DATTA - - 10,50,000 0.56
8. VLS FINANCE LIMITED 1,50,000 0.08 10,20,000 0.54
9. UNIVERSAL CINE TRADES - - 9,40,000 0.50
10. PRAMOD KUMAR SARAF 6,00,000 0.32 8,81,000 0.47
* Overall ceiling is within the ceiling of remuneration as defined u/s 198 of the Companies Act, 2013
1 Gross salary
(a) Salary as per provisions contained in section 17(1) of the Income-tax 42.53 42.53
Act,1961
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 -
(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961 -
2 Stock Option -
3 Sweat Equity
4 Commission
- as % of profit
others, specify…
5 Others, please specify 2.95 2.95
Total 45.48 45.48
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the
information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the
Indian Accounting Standards prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as
amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2020,
the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.
We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the financial
statements.
Information Other than the Financial Statements and Auditor’s Report Thereon
The Company’s Board of Directors is responsible for the other information. The other information comprises the information included in
the Management Discussion and Analysis, Board’s Report including Annexures to Board’s Report, Business Responsibility Report, Corporate
Governance and Shareholder’s Information, but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion
thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether
the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or
otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact. We have nothing to report in this regard.
In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either
intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are responsible for overseeing the Company’s financial reporting process.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit.
We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The
risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in
the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has
adequate internal financial controls system in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made
by the management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to
cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial
statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the
economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality
and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of
any identified misstatements in the financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the
audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s
report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that
a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
2. As required by Section 143(3) of the Act, based on our audit we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary
for the purposes of our audit of the aforesaid financial statements;
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination
of those books;
c) The balance sheet, the statement of profit and loss including other comprehensive income, statement of changes in equity and the
statement of cash flow dealt with by this Report are in agreement with the relevant books of account;
d) In our opinion, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act, read with relevant
Rules issued thereunder;
e) On the basis of the written representations received from the directors as on March 31, 2020 taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2020 from being appointed as a director in terms of Section 164 (2)
of the Act;
f ) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating
effectiveness of such controls, refer to our separate Report in “Annexure B”. Our report expresses an unmodified opinion on the
adequacy and operating effectiveness of the Company’s internal financial controls over financial reporting;
g) With respect to the other matters to be included in the Auditor’s Report in accordance with the requirements of Section 197(16) of
the Act, as amended:
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the
Company to its directors during the year is in accordance with the provisions of Section 197 of the Act; and
h) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and
Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations as at March 31, 2020 on its financial position in its financial
statements – Refer Note 40, 41 and 42 to the financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable
losses; and
iii. There has been no delay in transferring amounts required to be transferred to the Investor Education and Protection Fund by
the Company during the year ended March 31, 2020.
Deepak K. Aggarwal
Place: New Delhi Partner
Date: June 10, 2020 Membership No. 095541
UDIN : 20095541AAAADD3088
(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.
(b) The fixed assets are physically verified by the management according to a phased program designed to cover all the items over
a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets.
Pursuant to the program, the fixed assets have been physically verified by the management during the year and no material
discrepancies were noticed on such verification, discrepancies have duly been adjusted in the financials.
(c) According to the information and explanation given to us and on the basis of our examination of the records of the Company, the
title deed of immovable properties is held in the name of the company.
(ii) In our opinion and according to the information and ex planations given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business. The
discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt
with in the books of account. In view of the lockdown restriction imposed by the Government, our attendance at the physical inventory
verification done by the management was impracticable. Related alternate audit procedures were therefore relied up on to obtain
assurance over the existence and condition of inventory at the year end.
(iii) The Company has not granted any loans, secured or unsecured, to companies, firms and limited liability partnership or other parties
covered in the registered maintained under section 189 of the Act. Accordingly, clauses 3 (iii) (a) to (c) of the Order are not applicable.
(iv) As per the information and explanation given to us and on the basis of our examination of the records, the company has complied with
provision of section 185 and 186 of the Act, with respect to the loans and investment made.
(v) In our opinion and according to explanation given to us, As the company has not accepted deposits as per directives issued by the
Reserve Bank of India and provisions of sections 73 to 76 or any other provisions of the Companies Act and rules framed there under.
(vi) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company as
specified by the Central Government of India under section 148(1) of the Act and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view
to determine whether they are accurate and complete.
(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the
Company is generally regular in depositing undisputed statutory dues in respect of provident fund, income tax, sales tax, service
tax, customs duty, goods and service tax, excise duty, value added tax, cess and other material statutory dues as applicable with the
appropriate authorities. Employees’ state insurance is not applicable on the company. Further, there were no undisputed amounts
outstanding at the year-end for a period of more than six months from the date they became payable.
b) According to the information and explanations given to us and as per the books and records examined by us, there are no dues of
Custom Duty, Income Tax, and Cess which have not been deposited on account of any dispute, except the following in respect of
disputed Excise Duty, Service Tax and Sales Tax along with the forum where dispute is pending:
Name of the statue Nature of dues Amount Period to which the amount pertains Forum where
(H in Lakhs) * dispute is pending
Central Excise Act, Excise duty and 12.16 June 07 to August 08 CESTAT, Mumbai
1944 penalty
Central Excise Act, Excise duty and 14.25 Apr-11 to Sep-11, Apr-10 to Sep-10, Apr-09 to Sep-09, Jan- AC/DC
1944 penalty 07 to Feb-07, Apr-06 to Dec-06, Apr-11 to Sep-11, Apr-10
to Sep-10, Apr-09 to Sep-09.
(viii) According to the information and explanations given to us and as per the books and records examined by us, the Company has not
defaulted in repayments of its dues to Governments, banks and financial institution. The Company does not have any debenture.
(ix) According to the information and explanations given by the management, the Company has not raised any monies by way of initial
public offer or further public offer during the financial year, and the terms loans raised by the Company have been applied for the
purpose for which they are were obtained. Where such end use has been stipulated by the lender(s).
(x) In our opinion and on the basis of information and explanations given to us, no cases of fraud by the Company or fraud on the Company
by its officers or employees has been noticed or reported during the year.
(xi) According to the information and explanations given to us, the managerial remuneration has been paid and provided in accordance
with the requisite approvals as mandated by the provisions of section 197 read with Schedule V to the Act.
(xii) As the Company is not a Nidhi Company, hence clause (xii) of the Order is not applicable to the Company.
(xiii) According to the information and explanations given to us, all transactions with the related parties are in compliance with sections 177
and 188 of Act, as applicable and the details have been disclosed in these financial statements as required by the applicable accounting
standards.
(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the company has not
made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review
and hence, reporting requirements under clause 3(xiv) are not applicable to the company and, not commented upon.
(xv) In our opinion and on the basis of information and explanations given to us, the Company has not entered into non-cash transactions
with directors and persons connected with him. Hence, the provisions of section 192 of Act are not applicable.
(xvi) In our opinion and on the basis of information and explanations given to us, the Company is not required to be registered under section
45-IA of the Reserve Bank of India Act, 1934.
Deepak K. Aggarwal
Place: New Delhi Partner
Date: June 10, 2020 Membership No. 095541
UDIN : 20095541AAAADD3088
Auditor’s Responsibility
Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting of the Company based on
our audit.
We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance
Note”) and the Standards on Auditing, as specified under section 143(10) of the Act, to the extent applicable to an audit of internal financial
controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those
Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls
operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial
reporting and their operating effectiveness.
Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over
financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of
internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the
risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s
internal financial controls system over financial reporting.
a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the
assets of the company;
c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s
assets that could have a material effect on the financial statements.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects,
an adequate internal financial controls system over financial reporting and such internal controls over financial reporting were operating
effectively as at March 31, 2020, based on “the internal control over financial reporting criteria established by the Company considering the
essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued
by the Institute of Chartered Accountants of India”
Deepak K. Aggarwal
Place: New Delhi Partner
Date: June 10, 2020 Membership No. 095541
UDIN : 20095541AAAADD3088
DSIL is integrated conglomerate, primarily engaged in manufacture of sugar and allied products. From a humble beginning
in 1993, DSIL today is a multi-faceted, fast growing industrial group with the strong presence in diversified fields such as sugar
manufacturing, power and Ethanol/Industrial Alcohol production.
The Company has three sugar manufacturing units, out of which 2 units namely Dwarikesh Nagar and Dwarikesh Puram are located
in Bijnor District of Uttar Pradesh (U.P.) and one unit namely Dwarikesh Dham in Bareilly District (U.P.).
The company is listed on the National Stock Exchange of India and Bombay Stock Exchange of India. These financial statements are
presented in Indian Rupees (`).
Registration details:
Registration No. CIN : L15421 UP1993 PLC 018642
State code 20
B. i) Statement of compliance:
The Financial Statements have been prepared in accordance with Indian Accounting Standards (IND AS) as prescribed under
Section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards) Rules, 2015 and Companies
(Indian Accounting Standards) (Amendment) Rules, 2016 and relevant provisions of the Companies Act, 2013. The Financial
Statements comply with IND AS notified by Ministry of Company Affairs (“MCA”). The Company has consistently applied the
accounting policies used in the preparation for all periods presented.
These financial statements are approved and adopted by board of directors of the Company in their meeting held on
Wednesday, June 10, 2020.
Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a
revision to an existing accounting standard requires a change in the accounting policy hitherto in use.
C. Operating cycle
All assets and liabilities have been classified as current and non-current as per the Company’s normal operating cycle and other
criteria set out above which are in accordance with the Schedule III to the Act. Based on the nature of services and time between
the acquisition of assets for providing of services and their realisation in cash and cash equivalents, the Company has ascertained
its operating cycle as 12 months for the purpose of current / non-current classification of assets and liabilities.
E. Use of estimates
The preparation of financial statements in conformity with Ind AS requires the management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities and contingent assets at the date of
the financial statements and the results of operations during the reporting period. Although these estimates are based upon the
management’s best knowledge of current events and actions, actual results could differ from these estimates. Difference between
the actual results and estimates are recognized in the period in which the results are known / materialized.
(iv) Intangibles
Intangible assets are amortized over their estimated useful life as estimated by management on straight line basis, commencing
from the date, the asset is available to the Company for its use. Computers software are depreciated fully in the year of addition.
If the effect of the time value of money is material, provisions are discounted to reflect its present value using a current pre-tax
rate that reflects the current market assessments of the time value of money and the risks specific to the obligation. When
discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset
or transfer the liability takes place either:
• In the principal market for the asset or liability, or
• In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset
or liability, assuming that market participants act in their economic best interest.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value
hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities
Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or
indirectly observable
Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether
transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is
significant to the fair value measurement as a whole) at the end of each reporting period.
For the purpose of fair value disclosures, the Company has determined classes of assets & liabilities on the basis of the nature,
characteristics and the risks of the asset or liability and the level of the fair value hierarchy as explained above.
Pre-operative expenditure incurred up to the date of commencement of commercial production is capitalized as part of property,
plant and equipment.
Emergency machinery spares of irregular use and critical insurance machinery spares are capitalized as part of relevant plant &
machinery.
Capital work in progress includes property plant & equipment under installation/under development as at the balance sheet date.
Capital expenditure on tangible assets for research and development is classified under property and equipment and is depreciated
on the same basis as other property, plant and equipment.
Property, plant and equipment are derecognised from the financial statement, either on disposal or when no economic benefits
are expected from its use or disposal. Losses arising in the case of retirement of property, plant and equipment and gain or losses
arising from disposal of property, plant and equipment are recognized in the statement of profit and loss in the year of occurrence.
B. Investment properties
Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment
properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any. The cost includes the cost of
replacing parts and borrowing costs for long-term construction projects if the recognition criteria are met. When significant parts of
Though the Company measures investment property using cost based measurement, the fair value of investment property is
disclosed in the notes. Fair values are determined based on an annual evaluation performed by an accredited external independent
valuer.
Investment properties are derecognized either when they have been disposed of or when they are permanently withdrawn from
use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the
carrying amount of the asset is recognized in statement of profit & loss in the period of de-recognition.
C. Intangible assets
Intangible assets are amortized over their estimated useful life on straight line basis, commencing from the date, the asset is
available to the Company for its use.
Items of expenditure that meet the recognition criteria as mentioned in Accounting Standard are classified as intangible assets and
are amortized over the period of economic benefits not exceeding ten years, except Computers software which is depreciated fully
in the year of addition.
Depreciation on tangible assets is provided on straight line method over the useful life of assets estimated by the Management.
Property, Plant and Equipment which are added / disposed of during the year, deprecation is provided pro-rata basis with reference
to the month of addition / deletion.
The management estimates the useful life for fixed assets as follows:
(*) Based on technical evaluation, the management believes that useful life as given above represents the period over which
management expects to use these assets. Hence, the useful life for these assets is different from the useful life as prescribed under
Part C of Schedule II of the Companies Act, 2013.
Computers (including accessories and peripherals) and temporary structures are depreciated fully in the year of addition. All assets
costing H5,000 or below are depreciated in one-year period.
Depreciation and amortization methods, useful life and residual values are reviewed periodically, including at the end of each
financial year.
E. Capital work-in-progress
Capital work-in-progress/intangible assets under development are carried at cost, comprising direct cost, related incidental
expenses and attributable borrowing cost.
If the recoverable amount of an asset or CGU is estimated to be less than its carrying amount, the carrying amount of the asset (or
CGU) is reduced to its recoverable amount. An impairment loss is recognized in the statement of profit or loss.
An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates used to determine the
recoverable amount. The carrying amount of the asset is increased to its revised recoverable amount, provided that this amount
does not exceed the carrying amount that would have been determined (net of any accumulated amortization or depreciation) had
no impairment loss been recognized for the asset in prior years. Impairment losses on continuing operations, including impairment
on inventories are recognized in the statement of profit and loss, except for properties previously revalued with the revaluation
taken to other comprehensive income. For such properties, the impairment is recognized in OCI up to the amount of any previous
revaluation surplus.
G. Inventories
Inventories are valued at lower of cost or net realizable value except in case of scrap which is taken at net realizable value. Net
realizable value is the estimated selling price in the ordinary course of business, less estimated cost necessary to make the sale. Cost
for various items of inventory is determined as under:
Raw Materials & Components (including those in transit) Purchase cost including incidental expenses on FIFO basis
Chemicals, packing material and other store & spares Purchase cost including incidental expenses on weighted average basis.
(including those in transit)
Work in progress At raw material cost including proportionate production overheads.
Finished Goods :
1. Sugar 1. At raw material cost including proportionate production overheads.
2. Molasses 2. At average net realizable price.
3. Industrial Alcohol 3. At value of molasses as determined above plus proportionate
production overheads in distillery.
4. Traded Goods 4. Purchase cost including incidental expenses on FIFO basis.
For the purpose of the statement of cash flows, cash and cash equivalents consists of cash and short term deposits, as defined
above, net of outstanding bank overdraft as they being considered as integral part of the Company’s cash management.
I. Leases
Ind AS 116 requires lessees to determine the lease term as the non-cancellable period of a lease adjusted with any option to
extend or terminate the lease, if the use of such option is reasonably certain. The Company makes an assessment on the expected
lease term on a lease-by-lease basis and thereby assesses whether it is reasonably certain that any options to extend or terminate
the contract will be exercised. In evaluating the lease term, the Company considers factors such as any significant leasehold
improvements undertaken over the lease term, costs relating to the termination of the lease and the importance of the underlying
asset to Company’s operations taking into account the location of the underlying asset and the availability of suitable alternatives.
At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a corresponding lease liability
for all lease arrangements in which it is a lessee, except for leases with a term of twelve months or less (short-term leases) and low
value leases. For these short-term and low value leases, the Company recognizes the lease payments as an operating expense on a
straight-line basis over the term of the lease.
Certain lease arrangements include the options to extend or terminate the lease before the end of the lease term. ROU assets and
lease liabilities includes these options when it is reasonably certain that they will be exercised.
The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease
payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incentives. They are
subsequently measured at cost less accumulated depreciation and impairment losses.
Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter of the lease term and
useful life of the underlying asset. Right of use assets are evaluated for recoverability whenever events or changes in circumstances
indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e.
the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not
generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined
for the Cash Generating Unit (CGU) to which the asset belongs.
The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease payments are
discounted using the interest rate implicit in the lease or, if not readily determinable, using the incremental borrowing rates in the
country of domicile of these leases. Lease liabilities are re-measured with a corresponding adjustment to the related right- of- use
asset if the Company changes its assessment if whether it will exercise an extension or a termination option. Lease liability and ROU
asset have been separately presented in the Balance Sheet and lease payments have been classified as financing cash flows.
Transition
Effective April 1, 2019, the Company adopted Ind AS 116 “Leases” and applied the standard to all lease contracts existing on April
1, 2019 using the modified retrospective method and has taken the cumulative adjustment to retained earnings, on the date of
initial application. Consequently, the Company recorded the lease liability at the present value of the lease payments discounted
at the incremental borrowing rate and the right of use asset at its carrying amount as if the standard had been applied since the
commencement date of the lease, but discounted at the Company’s incremental borrowing rate at the date of initial application.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity
shares.
If the effect of the time value of money is material, provisions are disclosed using a current pre-tax rate that reflects, when appropriate,
the risk specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as
finance cost.
Commitments include the amount of purchase order (net of advances) issued to parties for completion of assets. Provisions,
contingent liabilities, contingent assets and commitments are reviewed at each balance sheet date.
Onerous contracts
A provision for onerous contracts is measured at the present value of the lower expected costs of terminating the contract and the
expected cost of continuing with the contract. Before a provision is established, the Company recognizes impairment on the assets
with the contract.
M. Taxes
Tax expense comprises current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax
authorities in accordance with the Income-Tax Act, 1961 enacted in India. The tax rates and tax laws used to compute the amount
are those that are enacted or substantively enacted, at the reporting date.
Deferred tax
Deferred tax is provided using the balance sheet approach on temporary differences at the reporting date between the tax bases
of assets and liabilities and their carrying amounts for financial reporting purpose at reporting date. Deferred income tax assets and
liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date
and are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or
settled. The effect of changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the
period that includes the enactment or the substantive enactment date. A deferred income tax asset is recognized to the extent that
it is probable that future taxable profit will be available against which the deductible temporary differences and tax losses can be
utilized.
The carrying amount of deferred tax assets are reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilised. Unrecognised
deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future
taxable profits will allow deferred tax assets to be recovered.
The company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the recognized
amounts and where it intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.
N. Revenue recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can
be reliably measured.
Ind AS 115 provides for a five step model for the analysis of Revenue transactions. The model specifies that revenue should be
recognised when (or as) an entity transfer control of goods or services to a customer at the amount to which the entity expects to
be entitled. Further the new standard requires enhanced disclosures about the nature, amount, timing, and uncertainty of revenue
and cash flows arising from the entity’s contracts with customers.
Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the
consideration we expect to receive in exchange for those products or services.
Interest
Interest is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
Dividends
Revenue in respect of dividends is recognised when the shareholders rights to receive payment is established by the balance sheet
date.
Insurance claim
Insurance and other claims are accounted for as and when admitted by the appropriate authorities in view of uncertainty involved
in ascertainment of final claim.
• Initial recognition
Foreign currency transactions are recorded on initial recognition in the functional currency, using the exchange rate at the date
of the transaction.
• Conversion
Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Non-monetary items,
which are measured in terms of historical cost denominated in a foreign currency, are reported using the exchange rate at the
date of the transaction. Non-monetary items, which are measured at fair value or other similar valuation denominated in a foreign
currency, are translated using the exchange rate at the date when such value was determined.
• Exchange differences
The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the
gain or loss on the change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognized
in OCI or profit or loss are also recognized in OCI or profit or loss, respectively).
P. Borrowings
Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at
amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit
or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are
recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In
Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired.
The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and
the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in the statement of profit or
loss as other gains/(losses).
Q. Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial
period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are
expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection
with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the
borrowing costs.
R. Employee benefits
Expenses and liabilities in respect of employee benefits are recorded in accordance with Indian Accounting Standard (Ind AS)-19 -
‘Employee Benefits’.
Accumulated leaves, which is expected to be utilized within the next 12 months, is treated as short-term employee benefit. The
Company measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused
entitlement that has accumulated at the reporting date. The Company treats accumulated leave expected to be carried forward
beyond twelve months, as long-term employee benefit for measurement purposes. Such long term compensated absences are
provided for based on actuarial valuation. The actuarial valuation is done as per projected unit credit method at the year-end.
S. Financial Instruments
(a) Financial Assets
i. Classification
The company classified financial assets as subsequently measured at amortized cost, fair value though other
comprehensive income or fair value through profit or loss on the basis of its business model for managing the financial
assets and contractual cash flow characteristics of the financial asset.
After initial measurement, such financial assets are subsequently measurement at amortized cost using the effective
interest rate (EIR) method. Amortized cost is calculated by taking into account any discount and premium and fee or costs
that are an integral part of an EIR. The EIR amortization is included in finance income in the statement of profit and loss.
The losses arising from impairment are recognized in the statement of profit and loss.
If the company decides to classify an equity instrument as at FVTOCI, then fair value changes on the instrument, excluding
dividends, are recognized in other compressive income (OCI). There is no recycling of the amounts from OCI to statement
of profit or loss, even on sale of such investments.
Equity instrument includes within the FVTPL category are measured at fair value with all changes recognized in the
Statement of profit or loss.
vii. Derecognition
A financial assets (or, where applicable, a part of a financial asset) is primarily derecognized when:
• The right to receive cash flows from the assets have expired or
• The company has transferred substantially all the risks and rewards of the assets, or
• The company has neither transferred nor retained substantially all the risks and rewards of the assets, but has transferred
control of the assets.
The application of simplified approach does not require the company to track changes in credit risk. Rather, it recognized
impairment loss allowance based on lifetime expected credit loss at each reporting date, right from its initial recognition.
Amortized cost is calculated by taking into account any discount or premium on acquisition and transaction cost. The EIR
amortization is included as finance cost in the statement of profit and loss.
iv. Derecognition
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an
existing financial liability is replaced by another from the same lander on substantially different terms, or the terms of
an existing liability are, substantially modified, such an exchange or modification is treated as the derecognition of the
original liability and the recognition of a new liability. The difference in the respective carrying amount recognized in the
Statement of Profit and loss.
All derivative financial instruments are recognised as assets or liabilities on the balance sheet and measured at fair value,
generally based on quotation obtained from banks/financial institutions. The accounting for changes in the fair value of a
derivative instruments depends on the intended use of the derivatives and the resulting designation.
The fair values of all derivatives are separately recorded in the balance sheet within current and non current assets and
liabilities. Derivatives that are designated as hedges are classified as current and non current depending upon the maturity of
the derivatives.
The use of derivative can give rise to credit and market risk. The Company tries to control credit risk as far as possible by only
entering into the contract with reputable banks/ financial institution. The use of derivative instrument is subject to limits,
authorities and regular monitoring by appropriate levels of management. The limits, authorities and monitoring systems are
periodically reviewed by the management and board. The market risk on derivatives are mitigated by changes in the valuation
of the underlying assets, liabilities or transactions, as derivatives are used only for risk management purposes.
The Operating Segments have been identified on the basis of the nature of products/ services.
i. Segment Revenue includes sales and other income directly identifiable with/ allocable to the segment including inter-
segment revenue.
ii. Expenses that are directly identifiable with/ allocable to the segments are considered for determining the segment result.
Expenses not allocable to segments are included under unallocable expenditure.
iv. Segment results includes margin on inter segment and sales which are reduced in arriving at the profit before tax of the
company.
v. Segment assets and Liabilities include those directly identifiable with the respective segments. Assets and liabilities not
allocable to any segment are classified under unallocable category.
U. Government grants
Government grants are recognized at fair value when there is reasonable assurance that the grant would be received and the
Company would comply with all the conditions attached with them.
Government grants related to PPE are treated as deferred income (included under non-current liabilities with current portion
considered under current liabilities) and are recognized and credited in the Statement of Profit and Loss on a systematic and rational
basis over the estimated useful life of the related asset and included under “Other Income”.
Government grants related to revenue nature are recognized on a systematic basis in the Statement of Profit and Loss over the
periods necessary to match them with the related costs which they are intended to compensate and are adjusted with the related
expenditure.
If not related to a specific expenditure, it is taken as income and presented under “Other Income”.
|
3 Property, plant and equipment (H In Lakhs)
A. Tangible Assets B. Intangible Assets
Computer
Furniture Total
Freehold Plant and Office softwares
Buildings and Vehicles Computers Total (A) Total (B) (A+B)
Land equipment equipment (Bought
fixtures
out)
Gross Block (at cost)
As at 01.04.2018 818.70 11,634.53 61,112.03 394.18 505.58 155.35 405.45 75,025.82 197.09 197.09 75,222.91
Additions - 719.45 352.27 17.47 0.40 11.11 44.39 1,145.09 15.48 15.48 1,160.57
Disposals (1.10) - (21.02) (2.44) (0.08) (11.35) (22.51) (58.50) (7.30) (7.30) (65.80)
Additions - 1,316.36 12,770.06 51.93 170.36 4.32 32.55 14,345.58 9.53 9.53 14,355.11
Disposals - (26.01) (274.74) (5.48) (52.70) (0.09) (17.05) (376.07) - - (376.07)
As at 31.03.2020 817.60 13,644.33 73,938.60 455.66 623.56 159.34 442.83 90,081.92 214.80 214.80 90,296.72
Depreciation/Amortisation
As at 01.04.2018 - 4,844.01 35,119.77 274.13 209.16 91.60 405.45 40,944.12 197.09 197.09 41,141.21
Charge for the year - 249.32 2,917.83 21.85 35.41 8.55 44.39 3,277.35 15.48 15.48 3,292.83
Disposals - - (19.26) (1.70) (0.06) (7.38) (22.51) (50.91) (7.30) (7.30) (58.21)
As at 31.03.2019 - 5,093.33 38,018.34 294.28 244.51 92.77 427.33 44,170.56 205.27 205.27 44,375.83
Charge for the year - 271.04 3,044.33 27.75 39.69 7.99 32.55 3,423.35 9.53 9.53 3,432.88
Disposals - (9.75) (179.11) (4.80) (21.75) (0.03) (17.05) (232.49) - - (232.49)
As at 31.03.2020 - 5,354.62 40,883.56 317.23 262.45 100.73 442.83 47,361.42 214.80 214.80 47,576.22
Net Block as at 31.03.2020 817.60 8,289.71 33,055.04 138.43 361.11 58.61 - 42,720.50 - - 42,720.50
Net Block as at 31.03.2019 817.60 7,260.65 23,424.94 114.93 261.39 62.34 - 31,941.85 - - 31,941.85
Note: Refer note no 44 for charges.
Note: Out of H3,432.88 Lakhs depreciation and amortisation for the period, H0.84 Lakhs transferred to preoperative expenses.
Notes to Financial Statement as at March 31, 2020
(H In Lakhs)
Amount
3a Right- of- use assets:
Gross Block (at cost)
As at 01.04.2019 -
Additions 472.28
Disposals -
As at 31.03.2020 472.28
Amortisation
As at 01.04.2019 -
Charge for the year 158.63
Disposals -
As at 31.03.2020 158.63
(H In Lakhs)
Amount Amount
4 Capital work in progress:
Opening As at 01.04.2018 19.47
Additions
Expenditure made during the year 2,391.29
Pre-operative expenses
(i) Interest and other processing fees 10.10
(ii) Employee benefit expenses 1.95 12.05
Capitalised during the year (807.97)
As at 31.03.2019 1,614.84
6 Non-current loans
Unsecured, considered good:
Security deposits 46.88 37.81
Total non current loans 46.88 37.81
Net deferred tax assets/(liabilities) 4,014.82 1,447.41 427.17 5,889.42 3,330.86 829.34 (145.38) 4,014.82
* Includes items routed through other equity
Note:
1) Deferred tax calculated on land @ 23.296%.
2) Deferred tax on investment fair value is calculated @ 10.40%.
(H In Lakhs)
As at As at
March 31, 2020 March 31, 2019
9 Income tax assets (net)
Prepaid Taxes 10,689.23 8,324.89
Provision for taxes (9,088.42) (6,724.10)
Net income tax assets 1,600.81 1,600.79
12 Trade receivables
Unsecured, considered good: 9,800.49 6,013.31
Includes unbilled revenue of H798.77 Lakhs (previous year - H1,639.52 Lakhs)
Less: Impairment allowance - -
Total trade receivable 9,800.49 6,013.31
15 Current - loans
unsecured, considered good:
Advances other than capital advances:
Security deposit - 6.49
Advance Lease Rent 2.41 2.51
Other loans (advances to employees) 10.44 11.55
Total current loans 12.85 20.55
A. Reconciliation of shares outstanding at the beginning and at the end of the reporting year is set out below: (H In Lakhs)
As at March 31, 2020 As at March 31, 2019
No of shares Amount No of shares Amount
Authorised:
Equity shares:-
At the beginning of the year 22,50,00,000 2,250.00 22,50,00,000 2,250.00
Change during the year - - - -
Outstanding at the end of the year 22,50,00,000 2,250.00 22,50,00,000 2,250.00
Issued, Subscribed and Fully paid up:
Equity shares:-
At the beginning of the year face value H1 (previous year H1) 18,83,01,470 1,883.01 18,83,01,470 1,883.01
Change during the year - - - -
Outstanding at the end of the year face value H1 18,83,01,470 1,883.01 18,83,01,470 1,883.01
D Aggregate number of bonus shares issued, shares issued for consideration other than cash and shares bought back during the period of
five years immediately preceding the reporting date.-Nil
(H In Lakhs)
As at As at
March 31, 2020 March 31, 2019
19 Other equity
a) Capital reserve
Opening balance 59.87 59.87
Changes during the year - -
Closing balance 59.87 59.87
b) Securities premium
Opening balance 14,688.11 14,688.11
Changes during the year - -
Closing balance 14,688.11 14,688.11
d) Other reserves
(i) Capital redemption reserve
Opening balance 2,362.00 2,252.00
Changes during the year - 110.00
Closing balance 2,362.00 2,362.00
(ii) General reserve -
Opening balance 127.57 127.57
Changes during the year - -
Closing balance 127.57 127.57
22 Provisions (non-current)
Provision for employee benefits
Gratuity 1,628.95 1,395.57
Leave encashment 269.79 356.23
Total provisions (non-current) 1,898.74 1,751.80
25 Trade payables
a) Micro and small enterprises* (note 47) 95.35 44.77
b) Others 20,890.84 18,206.54
Total trade payables 20,986.19 18,251.31
*There are no outstanding amounts payable beyond the agreed period to Micro and Small enterprises as required by MSMED Act, 2006 as
on the Balance Sheet date to the extent such enterprises have been identified based on information available with the company. In view of
this there is no overdue interest payable.
31 Other income
a) Interest income
on deposits with banks 16.70 395.44
b) Assistance received from Governments - 2,790.18
c) Profit on sale of property, plant and equipment (net) - 20.41
d) Gain on foreign exchange fluctuations (net) 2.07 95.96
e) Rent (including lease rent) 2.18 -
f ) Other non operating income 519.05 308.05
Total other income 540.00 3,610.04
35 Finance costs
a) Interest expense
i) Interest on fixed loans :
Term loans* 1,064.06 424.16
Others - 0.12
1,064.06 424.28
ii) Interest on cash credit and others (Net of H1,012.92 lakhs towards interest reimbursed/ to be 1,393.89 1,008.19
reimbursed on buffer stock by the Central Government, previous year H623.77 lakhs)
iii) Interest on delayed payment of direct taxes 38.82 94.58
iv) Unwinding of discount (Increase in financial liabilities) 443.82 248.44
v) Net interest on defined benefit liability 110.30 102.18
b) Dividend on redeemable preference share (including dividend distribution tax) 120.00 149.99
c) Other borrowing costs** 131.88 98.35
Total finance costs 3,302.77 2,126.01
* Interest expenses are net off interest capitalized of H248.04 Lakhs (previous year H8.42 Lakhs)
**Mainly consist of loan processing facilities from banks.
37 Other expenses
Power and fuel
Power 77.48 89.77
(Net of H68.19 Lakhs power banked previous year H38.26 Lakhs)
Fuel 47.63 40.51
Other manufacturing expenses 1,127.86 965.81
Repairs to buildings 214.86 236.31
Repairs to machinery 2,778.87 2,332.28
Repairs & maintenance - others 107.28 99.66
Rent (including lease rent) - 166.17
Insurance 142.22 88.99
Rates and taxes 55.95 42.08
Travelling & conveyance 197.55 162.03
Sugar sales promotion expenses 315.95 323.13
Freight and forwarding (net of recovery from customers/Govt. assistance) (note no 56) 2,711.04 586.36
Donations & charity* 150.84 211.74
Loss on sale of property, plant and equipment (net) 7.52 -
Payment to the auditors [note 45 (a)] 26.24 23.15
Export Facilitation Charges 127.39 1,885.75
CSR expenses [note 45 (b)] 172.33 423.92
Doubtful Advance - 2.16
Miscellaneous expenses (Net of H173.64 lakhs towards insurance & storage expense reimbursed/ to be 940.25 846.10
reimbursed on buffer stock by the Central Government, previous year H108.18 Lakhs)
Total other expenses 9,201.26 8,525.92
* Includes CSR expenses of H150 Lakhs ( previous year nil)
38 Tax expenses
Current year 1,265.72 2,426.04
Total tax expenses 1,265.72 2,426.04
40 Contingent liabilities & commitments (to the extent not provided for)
i) Contingent Liabilities: *
a) Claim against the company not acknowledged as debts.
In respect of show cause notices from Central Excise department in various cases against which 38.93 220.24
the company has preferred appeals [net of amount reversed and payments of H53.49 Lakhs
(previous period H214.40 Lakhs)].
In respect of Trade Tax and Entry Tax demand received from Uttar Pradesh Trade Tax authorities - 14.57
in various cases, in respect of which the company has preferred appeals [net of amount
deposited under appeal of H Nil (previous period H7.44 Lakhs)].
b) Guarantees issued by bankers on behalf of the Company 600.25 570.48
c) Other money for which the company may contingently liable 15.74 15.74
ii) Commitments:
a) Estimated amount of contracts remaining to be executed on capital account and not provided 357.42 8,227.67
for net of advance of H Nil (previous year H2,048.89)
b) Balance of Investment committed - -
c) Other commitments - -
* In respect of certain disallowances and additions made by the Income Tax Authorities, Appeals are pending before the Appellate Authorities
and adjustment, if any, will be made after the same are finally settled.
41 Allahabad High Court in the case of PIL Rashtriya Kisan Mazdoor Sangathan VS State of U.P. passed a final order on March 09, 2017
directing the Cane Commissioner to decide afresh the issue as to whether the Sugar Mills are entitled for waiver of interest on the
delayed payment of the price of sugarcane for the seasons 2012-13, 2013-14 and 2014-15 under the provisions of Section 17(3) of the
U.P. Sugarcane (Regulations of Supply and Purchase) Act, 1953 (in short ‘the Act’). Thereafter in an CAPL (contempt application) No.
2815/2018 titled ‘V.M. Singh versus Shri Sanjay Bhoosereddy’ in the Hon’ble Allahabad High Court and its follow-on proceedings, the
Cane Commissioner is understood to have filed an affidavit specifying interest rates on delayed cane price payments but no such order
of the Cane Commissioner has been served on the Company or industry association. Based on the legal review of the facts of this case,
possibility of liability crystalizing is remote and hence no provision is considered necessary.
42 Cane societies were in dispute with the State Government of Uttar Pradesh with regard to retrospective partial waiver of society
commission payable by the sugar mills for the crushing seasons 2012-13,2014-15 and 2015-16 as a part of its relief package to sugar
industry . Hon’ble Allahabad High Court held that concessional rate of society commission fixed by the U.P. Government cannot have
retrospective operations and shall be applicable prospectively from the date of the notification. Against the said judgment, the U.P.
Sugar Mill Association filed SLP ( C ) No 032225-032227/2018 . Hon’ble Supreme Court, vide order dated 03.12.2018, issued notice and
directed that no coercive steps shall be taken against the petitioners. The matter is pending for further adjudication. Based on the legal
advice no liability is likely to crystalize on the Company on this matter.
(H In Lakhs)
Bank/FI, amount sanctioned and Current Repayment Schedule of
Non-Current
outstanding as on reporting Date ( H in Security amount outstanding and ROI
( H in Lakhs)
Lakhs) on the reporting date
i) Long Term Borrowings - Secured
PNB 2,689.60 8,741.20 Pari-passu charge ROI - 5%
Sanctioned - H13,448 Lakhs (2,017.20) (11,430.80) on fixed assets: - 51 monthly installments of
O/S - H11,430.80 Lakhs Ist on DN,DP & DD H224.13 lakhs each payable in
(H13,448 Lakhs) April,20 and onward.
PNB 584.40 11,103.60 Pari-passu charge ROI - 8.95%
Sanctioned - H11,688 Lakhs (-) (1,886.84) on fixed assets: - 20 qtly installments of H584.40
O/S - H11,688 Lakhs Ist on DN lakhs each payable from March,
(H1,886.84 Lakhs) (under disbursal) 21 and onwards.
PNB 14,098.00 - -1st pari-passu charge by way ROI - 8.75%
Sanctioned - H14,098 Lakhs (-) (-) of pledge of stock of sugar - Soft Loan sanctioned under
O/S - H14,098 Lakhs and by way of hypothecation subvention scheme of the
(H Nil) of stock of molasses, GOI by carving out equivalent
industrial alcohol, chemicals, amount from Fund Based
stores & spares. Working Capital limit.
‘- 2nd Pari-passu charge on ‘-Bullet payment to be made in
fixed assets of all three units April 2020 and to be restored as
of the Company Fund Based Working Capital.
Total term loans from Banks
O/S - H37,216.80 Lakhs 17,372.00 19,844.80
(H15,334.84 Lakhs) (2,017.20) (13,317.64)
45 Other disclosures :
a) Auditors remuneration (H In Lakhs)
Year ended Year ended
March 31, 2020 March 31, 2019
Statutory auditors
i) Audit fee (including limited review fee) 21.25 18.75
ii) Tax audit fee 2.75 2.25
iii) Certification/other services 1.90 1.65
iv) Out of pocket Expenses 0.34 0.50
Total 26.24 23.15
Inventory:
Finished goods
Opening stock (H In Lakhs)
Year ended Year ended
March 31, 2020 March 31, 2019
i) Sugar 78,680.19 49,710.54
ii) Molasses 407.11 29.76
iii) Industrial alcohol
-Spirit 14.72 111.45
-Ethanol 13.47 233.79
Total 79,115.49 50,085.54
47 THE MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT (MSMED) ACT, 2006
Based on the information so far obtained by the company, payment to enterprises covered under the Micro, Small and Medium
Enterprises Development Act, 2006 (MSMED Act) has been made within 45 days or contract terms whichever is lower and disclosure in
accordance with Section 22 of the MSMED Act is as under: (H In Lakhs)
Year ended Year ended
March 31, 2020 March 31, 2019
a) Principal amount and Interest due thereon remaining unpaid to any supplier at the end of 95.35 44.77
accounting year.
b) Interest paid by the Company in terms of Section 16 of the MSMED Act along with the amounts - -
of the payment made to the supplier beyond the appointed day during the accounting year.
c) The amount of interest due and payable for the year of delay in making payment (which have - -
been paid but beyond the appointed day during the year) but without adding the interest
specified under this Act.
d) The amount of interest accrued and remaining unpaid. - -
e) The amount of further interest remaining due and payable even in the succeeding years, - -
until such date when the interest dues above are actually paid to the small enterprise for the
purpose of disallowance as a deductible expenditure under Section 23 of this Act.
49 Employee benefits:
(a) The company has made provision for gratuity and leave encashment in the nature of defined benefit obligation on the basis of actuarial
valuation as per Ind AS 19. Since the liability has not been funded through a trust or insurer, there are no plan assets.
Special events:
There are no special events such as benefit improvements or curtailments or settlements during the inter-valuation period.
50 Related party disclosures as required by Ind AS 24 for the year ended March 31, 2020
a) Names of the related parties and description of relationship:
i) Enterprises over which key -Morarka Finance Limited
management personnel are able -Dwarikesh Trading Company Limited
to exercise significant influence
-Dwarikesh Informatics Limited
-Dwarikesh Agriculture Research Institute
-Faridpur Sugars Limited
-R R Morarka Charitable Trust
-Manotsav Foundation
ii) Key management personnel -Shri G.R.Morarka Executive Chairman
-Shri B.J.Maheshwari Managing Director & Company Secretary
Cum Chief Compliance Officer
-Shri Vijay S. Banka Managing Director
-Shri Alok Lohia Chief Financial Officer
-Shri B. K. Agarwal Independent Directors
-Shri. K. N. Prithviraj Independent Directors
-Smt. Nina Chatrath Independent Directors
iii) Relatives of Key Managerial Personnel -Ms. Priyanka G. Morarka (Daughter)
Shri G.R. Morarka
The following methods and assumptions were used to estimate the fair values.
a) Company has adopted effective rate of interest for calculating Interest. This has been calculated as the weighted average of
effective interest rates calculated for each loan. In addition processing fees and transaction cost relating to each loan has also been
considered for calculating effective interest rate.
b) Due to short term nature, the carrying amount of current financial assets (excluding investments) and current financial liabilities
(excluding current maturities of long term debt) are considered to be the same as of their fair values . Hence, the figures are not
shown in the above note. .
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices).
Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).
Valuation of investment has been done on the basis of latest available financials with the Company.
The Company’s activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company’s primary focus is to
foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. One of the
market risk to the Company is foreign exchange risk. The Company uses derivative financial instruments to mitigate foreign exchange
related risk exposures. The Company’s exposure to credit risk is influenced mainly by the individual characteristic of each customer.
A. Credit risk :
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, thereby
leading to a financial loss. The Company’s sugar sales are totally on cash. Power and ethanol are sold to state government entities,
thereby the credit default risk is significantly mitigated.
The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of cash credit
facilities, short term loans and commercial papers.
(H In Lakhs)
Upto 1 year More than 1 Total
year
As at March 31, 2020 18,661.39 310.59 18,971.98
As at March 31, 2019 12,563.97 2,374.20 14,938.17
B. Liquidity risk :
The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of term loan,
liability component of compound financial instruments (preference share) ,cash credit facilities, short term loans and others.
(H In Lakhs)
Payable on Less than 1 year More than 1 Total
demand year
As at March 31, 2020
Borrowings 46,116.64 18,862.76 19,324.77 84,304.17
Other financial Liabilities - 3,187.77 143.25 3,331.02
Trade and other payables 22,021.84 - 481.58 22,503.42
Total 68,138.48 22,050.53 19,949.60 1,10,138.61
As at March 31, 2019
Borrowings 49,595.33 2,007.96 13,960.55 65,563.84
Other financial Liabilities - 1,928.27 - 1,928.27
Trade and other payables 19,399.84 - 809.40 20,209.24
Total 68,995.17 3,936.23 14,769.95 87,701.35
The Company operates internationally and is transacted in foreign currencies and consequently the Company is exposed to foreign
exchange risk through its sales in overseas. The Company holds derivative financial instruments such as foreign exchange forward to
mitigate the risk of changes in exchange rates on foreign currency exposures.
The following table analyses the foreign currency risk from monetary assets and liabilities as at: (USD in Lakhs)
Particulars As at As at
March 31, 2020 March 31, 2019
Trade receivables 0.12 0.09
The details in respect of outstanding foreign currency forward contracts are as follows :
Particulars As at March 31, 2020 As at March 31, 2019
Amount (H In Lakhs) Amount (H In Lakhs)
(USD in Lakhs) (USD in Lakhs)
Forward Contracts 208.77 15,153.22 100.58 7,000.60
The foreign exchange forward contracts mature within twelve months. The table below analyzes the derivative financial instruments
into relevant maturity groupings based on the remaining period as at the balance sheet date:
Particulars As at March 31, 2020 As at March 31, 2019
Amount (H In Lakhs) Amount (H In Lakhs)
(USD in Lakhs) (USD in Lakhs)
Not Later than one months - - 49.40 3,432.07
Later than one month and not later than three months 208.77 15,153.22 51.18 3,568.53
Later than three months and not later than One year - - - -
During the year ended March 31, 2020, the Company has designated certain foreign exchange forward contracts as cash flow hedges to
mitigate the risk of foreign exchange exposure on highly probable forecast cash transactions. The related hedge transactions for balance
in cash flow hedge reserve as at March 31, 2020 are expected to occur and reclassified to statement of profit and loss within 3 months.
Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness
assessments to ensure that an economic relationship exists between the hedged item and hedging instrument, including whether the
hedging instrument is expected to offset changes in cash flows of hedged items.
If the hedge ratio for risk management purposes is no longer optimal but the risk management objective remains unchanged and
the hedge continues to qualify for hedge accounting, the hedge relationship will be rebalanced by adjusting either the volume of the
hedging instrument or the volume of the hedged item so that the hedge ratio aligns with the ratio used for risk management purposes.
Any hedge ineffectiveness is calculated and accounted for in the Statement of Profit or Loss at the time of the hedge relationship
rebalancing.
The following table provides the reconciliation of cash flow hedge reserve for the year ended:
(H In Lakhs)
Particulars As at As at
March 31, 2020 March 31, 2019
Gain / (Loss)
Balance at the beginning of the year 363.16 -
Gain / (Loss) recognized in other comprehensive income during the period (1,138.08) 558.23
Tax impact on above 397.69 (195.07)
Balance at the end of the year (377.23) 363.16
The Company offsets a financial asset and a financial liability when it currently has a legally enforceable right to set off the recognized
amounts and the Company intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.
(H In Lakhs)
Impact on statement of
Sensitivity on variable rate borrowings profit & loss account
March 31, 2020 March 31, 2019
Interest rate increase by 0.25% (179.76) (128.71)
Interest rate decrease by 0.25% 179.76 128.71
53 Impairment review:
Assets are tested for impairment whenever there are any internal or external indicators of impairment. Impairment test is performed
at the level of each Cash Generating Unit (‘CGU’) or groups of CGUs within the Company at which the assets are monitored for internal
management purposes, within an operating segment. The impairment assessment is based on higher of value in use and value from
sale calculations. During the year, the testing did not result in any impairment in the carrying amount of other assets. The measurement
(i) Operating margins (Earnings before interest and taxes), (ii) Discount Rate, (iii) Growth Rates and (iv) Capital Expenditure
54 During financial year ended March 31, 2020, as per GOI ‘s notification no 1/(14)/2018 – S P 1 , the Company has accounted assistance @
H13.88 per quintal of cane crushed during sugar season 2018-19 amounting to H664.03 lakhs ( previous year H3,594.89 Lakhs ) and
deducted the same from cost of material consumed.
55 The Company, as per GOI’s notification no 1(6)/2018-SP-I dated 15th June 2018 of GOI, created Buffer stock of 3,29,010 quintal sugar on
1st July , 2018 for a period of one year for which inventory carrying cost (including interest & storage cost) is to be reimbursed by the
Government as specified in the notification.
On expiry of the said period GOI issued another notification no 1(8)/2019-SP-I dated 31st July 2019 and accordingly company created
fresh buffer stock of 4,47,930 quintal sugar on 1st August 2019 for a period of another one year.
Total claim during the FY 2019-20 under both the notifications works out to H1,186.56 lakhs (previous year H731.95 Lakhs), of which
H1,012.92 lakhs (previous year H623.77 Lakhs) towards interest reimbursement is deducted from Finance cost and H173.64 lakhs (previous
year H108.18 Lakhs) related to reimbursement of storage expenses is deducted from Other expenses.
56 Under GOI’s notification no 1(14)/2018 notified the Scheme for defraying expenditure towards internal transport, freight, handling and
other charges on export under MIEQ Scheme for sugar season 2018-19 notified by the Government. Under the said Scheme, the
Company has accounted for an amount of H1,531.16 lakhs ( previous year H1,383.67 Lakhs). The said amount is netted off from the actual
expenditure incurred by the Company.
Further , GOI vide notification no 1(14)/2019 –S.P.-1 dated 12.09.2019 , notified a Scheme for providing assistance @ H10,448/- per MT
to sugar mills for expenses on marketing cost including handling, upgrading and other processing costs and costs of international and
internal transport and freight charges on export of sugar under MAEQ Scheme for sugar season 2019-20. Under the said Scheme, the
Company’s entitlement till March, 2020 works out to H6,221.78 lakhs. The said amount is shown as Other operating revenues.
57 Based on the incentive policy announced by the State Government of Uttar Pradesh vide order no. -1631 (1) S.C./ 18-02-2004-57/ 2004
dated 24.08.2004 to encourage investment in the State, the company proceeded to invest amount in excess of threshold limit as set out
in the policy for availing various benefits over ten years period. On 04.06.2017 the policy was unilaterally withdrawn vide G.O. No. 1216
S.C/18.02.2007-185/2006.
Aggrieved by the said order of withdrawal, the Company and other aggrieved sugar companies challenged the order by filing appropriate
writ petitions. Hon’ble High Court on 12.02.2019 passed an order quashing & setting aside the order withdrawing the incentive scheme
and held the same to be in violation of principle of estopple & natural justice.
Company has since then written to competent authorities and submitted the requisite information/documents in support of its claims,
the matter is yet to be conculded by the authorities.
Adjustments for:
Income exempt for tax purpose 2.63 0.65
Expenses not allowed for tax purpose 86.59 150.44
Additional income for tax purposes - -
Brought forward unabsorbed depreciation setoff - -
Changes in recognized deductible temporary differences (297.70) 662.33
Prior year MAT entitlement (23.01) 25.95
Effect of deferred tax adjustment (excluding MAT credit entitlement) (652.72) (228.87)
Net adjustments (884.21) 610.50
Tax expense (181.69) 1,596.70
*Pursuant to introduction of section 115BAA of the Income Tax Act, 1961 through Taxation Law (Amendment) Ordinance, 2019
(Ordinance), the domestic companies have with effect from financial year commencing from April 1, 2019 and thereafter, option to pay
corporate income tax at reduced rate plus applicable surcharge and cess (New Tax Rate) by foregoing certain exemptions / deduction.
Based on the assessment made by the company, exemptions / deductions as available to the company will get exhausted in future
financial years after which the company will opt for lower tax rate as stated above. Accordingly Company has re-measured its deferred
tax assets and liabilities using the dual income tax rates, resulting in reversal of deferred tax liability of H1,315.25 lakhs.
The Company has assessed the impact of this pandemic on its business operations The Company has assessed the recoverability and
carrying values of its assets comprising property, plant and equipment; intangible assets; trade receivables, inventories and other assets
as at the balance sheet date using various internal and external information up to the date of approval of these financial statements.
The Company has performed sensitivity analysis on the assumptions used and based on current estimates expects the carrying amount
of these assets will be recovered and no material adjustment required in the financial statements. Also, basis the future cash flow
projections and availability of working capital limits, the Company is expected to have sufficient cash flows to meet its obligations for
next twelve months and does not anticipate that it will not be able to realize its assets and discharge its liabilities in the normal course
of business. The impact of COVID-19 on the Company’s financial statements may differ from that estimated as at the date of approval
of these financial statements due to uncertainties associated with its nature and duration and is highly dependent on future economic
developments.
The situation is changing rapidly giving rise to inherent uncertainty around the extent and timing of the potential future spread of the
COVID-19 and its impact on the Company’s business operations. The Company will continue to closely monitor any material changes to
future economic conditions.
61 Details of loans given, investments made and guarantee given under Section 186(4) of the Companies Act, 2013
(H In Lakhs)
Particulars Year ended Year ended
March 31, 2020 March 31, 2019
Loan given - -
Guarantee given - -
Investment made 32.92 31.77
62 The previous year’s including figures as on the date of transition have been reworked, regrouped, rearranged and reclassified wherever
necessary. Amounts and other disclosures for the preceding year including figures as at the date of transition are included as an integral
part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current
year.
As per our report of even date For and on behalf of Board of Directors of Dwarikesh Sugar Industries Limited
For NSBP & Co. G. R. Morarka Vijay S. Banka
Chartered Accountants Executive Chairman Managing Director
Firm Regn. No. 001075N DIN: 00002078 DIN: 00963355
Allocation of the value added to the State Exchequer does not include GST payment of H5,989 lakhs, H5,053 lakhs and H4,727 lakhs for
F.Y 2019-20, F.Y 2018-2019 and F.Y 2017-2018 respectively.
Recovery % - DN 10.31 10.31 10.30 10.16 10.32 10.47 11.11 12.12 12.34 12.24 12.44 12.00
Recovery % - DP 9.93 9.77 9.47 9.73 10.00 10.52 10.98 11.77 12.11 12.24 12.24 12.42
Recovery % - DD 8.61 8.77 8.55 9.09 9.15 9.65 10.14 11.16 10.89 11.24 12.24 12.39
Total losses % -DN 1.84 1.89 1.85 1.82 1.83 1.79 1.70 1.82 1.75 1.76 1.77 2.17
Total losses % -DP 1.97 1.96 1.93 1.76 1.81 1.66 1.61 1.62 1.61 1.66 1.74 1.60
Total losses % -DD 2.14 2.04 2.07 1.90 1.92 1.68 1.72 1.74 1.75 1.86 1.70 1.72
Sugar Cane Bagged in 5,22,037 6,83,165 7,10,349 7,78,198 7,97,890 7,07,397 9,20,511 9,48,800 11,27,722 14,41,423 12,96,625 15,36,915
Qtls. - DN
Sugar Cane Bagged in 4,54,380 6,34,460 5,57,845 7,67,410 8,38,650 7,64,090 8,95,261 8,56,652 11,85,936 13,79,135 12,40,605 14,84,250
Qtls. - DP
Sugar Cane Bagged in 2,58,461 5,14,082 5,22,085 7,41,195 7,44,505 6,61,266 6,95,766 6,65,433 10,24,515 14,95,298 12,39,857 15,67,955
Qtls. - DD
A PRODUCT
[email protected]