Dalmia Bharat Sugar & Industries Ltd.
|BSE: 500097||Sector: Agri and agri inputs|
|NSE: DALMIASUG||ISIN Code: INE495A01022|
|BSE 15:44 | 22 Jan||107.60||
|NSE 15:59 | 22 Jan||107.45||
|Mkt Cap.(Rs cr)||871|
|Mkt Cap.(Rs cr)||871.02|
Dalmia Bharat Sugar & Industries Ltd. (DALMIASUG) - Director Report
Company director report
Your Directors have pleasure in submitting their sixty fifth report on the auditedfinancial statements of the Company for the year ended March 312017.
Operations and Business Performance
The Company has achieved the highest ever profits during the financial year 2016-17largely on account of buoyancy of Sugar segment due to firming up of the sugar prices.
During the year under review the gross revenue of the Company for the financial year2016-17 has increased by 45.86% which is C1764.10 Crore as compared to C1209.42 Crore inthe previous financial year and the profit before tax for the financial year 2016-17 hasincreased by 401.79% which is C238.15 Crore as compared to C47.46 Crore in the previousfinancial year.
Please refer to the chapter on Management Discussion and Analysis for a detailedanalysis of the performance of the Company during the financial year 2016-17. In additionworking results for key businesses have been provided as an annexure to this report videAnnexure - 1.
The Company continues to be engaged in the same business during the financial year2016-17. There have been no material changes and commitments affecting the financialposition of the Company which have occurred between the end of the financial year and thedate of this report.
Transfer to Reserves
The Company proposes to retain its entire earnings in the profit and loss account andproposes not to transfer any amount to the General Reserve.
Your Directors have recommended a dividend of C2/- (100%) per equity share of C2/- eachfor the current financial year ended on March 312017 as against dividend of C0.60/- (30%)per equity share of C2/- each paid during the immediately preceding financial year.
During the financial year 2016-17 ICRA has upgraded the rating for long termfacilities of the Company to A+ which signifies the adequate degree of safety regardingtimely servicing of financial obligations. ICRA has also upgraded the rating for shortterm facilities of the Company to A1+ which is the highest rating in the rating scale ofICRA signifying very strong degree of safety regarding timely payment of financialobligations.
Board of Directors its Committees and their Meetings
During the financial year 2016-17 five (5) Board meetings were held. Reference isinvited to the Corporate Governance Report which forms part of this Report for thedetails of Board of Directors its committees and their meetings.
Directors and Key Managerial Personnel
Shri T. Venkatesan Director of the Company retires by rotation at the ensuing AnnualGeneral Meeting and being eligible offers himself for reappointment. He has furnishedrequisite declaration to the effect that he is not disqualified from being re-appointed asa Director of the Company.
The Key Managerial Personnel namely Shri Gautam Dalmia Managing Director and ShriAnil Kataria Chief Financial Officer continue to hold their respective offices during thecurrent financial year. Due to the sad demise of Shri K.V. Mohan the position of theCompany Secretary in the Company got vacant. Smt. Isha Kalra was appointed as the CompanySecretary of the Company in his place with effect from October 27 2016 and continue tohold her office.
The independent Directors namely Shri J.S. Baijal Shri M. Raghupathy and Shri P.Kannan have given their respective declaration of independence under Section 149 of theCompanies Act 2013. A meeting of the Independent Directors excluding all Non-IndependentDirectors and Members of the management of the Company was held as mandated by provisionsof Rule VIII of Schedule IV of the Companies Act 2013 wherein they inter-alia reviewedthe performance of the Chairman Non-Independent Directors and the Board as a whole.
The details of familiarisation programs for Independent Directors of the Company can beaccessed at https://www.dalmiasugar .com/upload/policies/Familarisation-Programme-for-Independent- Directors_2016-17.pdf.
The Nomination and Remuneration Policy of the Company on Director's appointment andremuneration is attached as Annexure- 2 and forms part of this Report.
Your Board of Directors have conducted a formal evaluation of its own performance andthe performance of its Committees and that of individual Directors in accordance withnorms laid down in the Nomination and Remuneration Policy of the Company and SEBI GuidanceNote on Board Evaluation.
Directors' Responsibility Statement
In terms of the provisions of Section 134(3)(6) of the Companies Act 2013 yourDirectors state that:
(a) in the preparation of the annual accounts for the year ended March 31 2017 theapplicable accounting standards have been followed and there are no material departuresfrom the same;
(b) the Directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit of the Company for that period;
(c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting frauds and other irregularities;
(d) the Directors have prepared the annual accounts on a going concern basis;
(e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) the Directors have devised proper system to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Particulars of Remuneration of Directors' Key Managerial Personnel and Employees'
The particulars of remuneration to Directors and Key Managerial Personnel and otherparticulars in terms of Section 197(12) read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 are given in Annexure-3 of thisReport.
A statement sharing the names and other particulars of the employee drawingremuneration in excess of the limits set out in Rule 5(2) and 5(3) of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are provided inAnnexure-3A of this Report.
Employees' Stock Option Scheme
The Company has not granted any employee stock options.
The report on the financial position of the Company's Subsidiaries HimshikharInvestment Limited Dalmia Solar Power Limited and Dalmia Sugar Ventures Limited for theyear ended March 31 2017 is attached in Form AOC -1 and forms part of this report asAnnexure-4.
The detailed Annual Reports of these subsidiaries are not being enclosed with thisAnnual Report. Any Member desiring to inspect the detailed Annual Reports of any of theaforementioned subsidiaries may inspect the same at the Registered Office of the Companyand that of the subsidiaries concerned. In event a member desires to obtain a copy of theAnnual Report of any of the aforementioned subsidiaries he may write to the RegisteredOffice of the Company specifying the name of the subsidiary whose Annual Report isrequired. The Company shall supply a copy of such Annual Report to such Member. The AnnualReport of the aforementioned subsidiaries are available at the Company's website
During the said financial year no company ceased to be a subsidiary of the Company orits subsidiary. The Company has no Associates and Joint Ventures.
The policy for determining material subsidiaries may be accessed on the Company'swebsite at http://www.dalmiasugar.com/upload/policies/DBSIL-Material-Subisdiary-Policy.pdf.
Consolidated Financial Statements
As required under section 129(3) of the Companies Act 2013 read with Regulation 33 ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 andAccounting Standard - 21 this Annual Report also includes Consolidated FinancialStatements for the financial year ended March 312017.
Corporate Governance Report
Your Directors believe that corporate governance is an ethically driven businessprocess that is committed to values aimed at enhancing the growth for the Company. YourCompany's corporate governance practices are driven by effective and strong Boardoversight timely disclosures transparent accounting policies and high levels ofintegrity in decision making. The Company's corporate governance practices have beendetailed in the Corporate Governance Report and same is attached together with theAuditors' certificate thereon and forms part of this Report.
Extract of Annual Return
The extract of the annual return is attached in Form MGT-9 giving inter- alia detailsof shareholding pattern indebtedness and managerial remuneration and forms part of thisReport as Annexure-5.
Corporate Social Responsibility
Your Directors have constituted a Corporate Social Responsibility Committee responsibleto identify monitor and review corporate social responsibility activities of the Companyand provide strategic direction for implementation of the corporate social responsibilitypolicy of the Company. The corporate social responsibility policy may be accessed at
Annual report on corporate social responsibility activities is attached as Annexure-6and forms part of this Report.
Pursuant to the said policy the Company has made expenses aggregating to C0.45 Croretowards Corporate Social Responsibility during the financial year 2016-17 coveringeducation health & sanitation skill development rural infrastructure developmentrural sports environment conservation etc. which is more than 2% of average net profitsof the Company made during three immediately preceding financial years.
Related Party Policy and Transactions
The Company has formulated a related party transactions policy and the same may beaccessed on the Company's website at http://
During the year under review there was no material contracts or arrangements enteredinto by the Company with the related parties referred to in section 188(1) of theCompanies Act 2013. Hence Form AOC-2 is not being attached to this Report.
Risk Management Policy
Your Board of Directors has formed a Risk Management Committee to frame and monitor theRisk Management Plan of the Company. The Committee is responsible for identifying criticalrisks framing Risk Management plan and reviewing effectiveness of implementation of thesame on ongoing basis.
Whistle Blower Policy and Vigil Mechanism
The Company has in place the whistle blower mechanism for directors employees andother stakeholders with a view to provide for adequate safeguards against victimisation ofstakeholders and provide for direct access to the Chairperson of the Audit Committee inappropriate cases.
The policy can be accessed at the website of the Company at http://
Disclosure under the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment.
No such complaints have been received by the said Committee during the financial year2016-17.
Investment Loans and Guarantees
The particulars of investments made by the Company and details of loans given andguarantees given by the Company are furnished in Note Nos. 13 16 20 and 45 of theStandalone Financial Statements of the Company.
Adequacy of internal financial controls
The Company has in place adequate internal financial controls with reference to thefinancial statements. The said financial controls have been tested and no reportablematerial weakness in the design and operations were observed.
Conservation of energy technology absorption and foreign exchange earnings and outgo
A statement giving details of conservation of energy technology absorption and foreignexchange earnings and outgo is given in Annexure - 7 and the same forms part of thisReport.
S.S. Kothari Mehta & Co. Chartered Accountants the Statutory Auditors of theCompany retires at the conclusion of the ensuing Annual General Meeting. In view of thecompletion of two terms of
5 consecutive years each the Board has recommended the name of NSBP & Co.Chartered Accountants for appointment as a Statutory Auditors for the period of 5 yearsfrom the conclusion of ensuing Annual General Meeting till the conclusion of next sixthAnnual General Meeting.
The Company has obtained from them a certificate to the effect that theirre-appointment if made would be in conformity with the limits prescribed in the section141 of the Companies Act 2013.
HMVN & Associates Cost Accountants were appointed as the Cost Auditors of theCompany to conduct Cost Audit for the year ended March 31 2016 and they have submittedthe Cost Audit Report for the said year on August 23 2016.
HMVN & Associates Cost Accountants New Delhi was re-appointed as the CostAuditors to conduct cost audit for the year ended March 312017 and they will besubmitting their report in due course of time.
Your Directors had decided to reappoint HMVN & Associates Cost Accountants NewDelhi as the Cost Auditors to conduct cost audit for the year ended March 31 2018 andthe remuneration payable to them for conduct of Cost Audit will be coming up for approvalbefore the Shareholders at the ensuing Annual General Meeting.
Secretarial Auditor and Report Thereon
The Board of Directors of the Company appointed Harish Khurana
6 Associates Practising Company Secretaries as the Secretarial Auditor to conduct theSecretarial Audit in terms of section 204 of the Companies Act 2013. The Report of theSecretarial Audit is attached in Form MR - 3 and forms part of this report as Annexure-8.
Comments on Auditors' Observations
The Reports submitted by the Secretarial Auditor and Statutory Auditor of the Companyare self explanatory and do not contain any qualification reservation or adverse remarkor disclaimer.
During the year under review the Auditors have not reported any matter under Section143 (12) of the Act.
The Company has not accepted any deposits from public during the year under review.
Orders Passed By Regulators
No significant and material orders have been passed by the regulators or courts ortribunals impacting the status of the Company.
Health Safety and Environment
Health and Safety of employees and clean environment receive utmost priority at alllocations of your Company. It has already implemented EHS System and provided safe workingenvironment at its plants and mines. Use of personal protective equipment by employeeshave become compulsory and training programs on Health Safety and Occupational Health arebeing conducted on a continuous basis. Our endeavour is to make all our plants safe andkeep all its employees healthy. Your Company has a philosophy that 'Clean & Green' ismore profitable.
The industrial relations during the year under review remained harmonious and cordial.
Your Directors wish to place on record their appreciation for the assistance andcooperation received from the financial institutions banks government authoritiescustomers vendors and stakeholders during the year under review. The Directors also wishto place their deep appreciation for the committed services by all the employees of theCompany.