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Dhampur Sugar Mills Ltd.

BSE: 500119 Sector: Agri and agri inputs
NSE: DHAMPURSUG ISIN Code: INE041A01016
BSE 14:08 | 30 Jul 355.10 0.95
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OPEN 356.00
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VOLUME 35681
52-Week high 395.00
52-Week low 125.00
P/E 10.23
Mkt Cap.(Rs cr) 2,358
Buy Price 354.40
Buy Qty 4.00
Sell Price 355.10
Sell Qty 24.00
OPEN 356.00
CLOSE 354.15
VOLUME 35681
52-Week high 395.00
52-Week low 125.00
P/E 10.23
Mkt Cap.(Rs cr) 2,358
Buy Price 354.40
Buy Qty 4.00
Sell Price 355.10
Sell Qty 24.00

Dhampur Sugar Mills Ltd. (DHAMPURSUG) - Director Report

Company director report

DHAMPUR SUGAR MILLS LIMITED

The Directors have pleasure in presenting 85th Annual Report of the Company togetherwith the Audited Accounts for the year ended March 31 2020.

Financial Results

Particulars

Consolidated

Standalone

For the year ended March 31 2020 For the year ended March 31 2019 For the year ended March 31 2020 For the year ended March 31 2019
Revenue from operations 3556.21 2910.72 3423.91 2771.54
Profit before finance costs tax depreciation and amortization exceptional items and other comprehensive income 392.29 492.27 395.71 497.18
Less: Finance costs 100.59 90.05 100.07 90.50
Less: Depreciation and Amortization expense 76.04 70.42 75.39 69.68
Profit before Tax 215.66 331.80 202.99 320.96
Provision for Tax (8.37) 66.32 (8.38) 66.00
Profit for the year 224.03 265.48 211.37 254.96
Profit / (loss) for the period from discontinued operation before tax (8.40 ) (12.65) - -
Tax expense on discontinued operation - 1.91 - -
Profit / (loss) for the period from discontinued operation after tax (8.40) (14.56) - -
Net Profit for the year 215.63 250.92 - -
Other comprehensive income (net of tax) (7.74) (0.01) (7.82) (0.34)
Total comprehensive income for the year 207.89 250.91 203.55 254.62

Operational Performance

The key operational data of the Company is as under: Sugar operations at a glance

Particulars For the year ended March 31 2020 For the year ended March 31 2019
Cane crushed (in lakh ton) 69.16 69.42
Net Recovery (%) 11.08% 11.51%
Sugar Produced from Cane ( in lakh ton) 7.66 7.99

Co-generation operations at a glance

Particulars For the year ended March 31 2020 For the year ended March 31 2019
Power generated (In Cr. Units)(M.W.) 69.28 76.70
Sale to UPPCL (In Cr. Units) (M.W.) 35.24 42.94

Chemical operations at a glance

Particulars For the year ended March 31 2020 For the year ended March 31 2019
RS/ENA/Ethanol produced (in lakh bulk litres) 1050.77 840.94
Chemicals produced (in lakh kilograms)

176.39 ^^^^^^^145.47

Company's Performance during FY 2020

Company's Performance during the Financial Year 2019-20 has been explained inManagement Discussion and Analysis Report which forms an integral part of this Board'sReport.

Impact of Global Crisis - Covid -19

The COVID-19 pandemic is a defining global crisis that has transformed the way wethink live and work. The spread of the virus disrupted the global economy and consumersentiment starting December 2019. The virus was declared a global pandemic by the WorldHealth Organisation in March 2020. The Central Government of India implemented a nationallockdown in late March 2020 which covered the comprehensive closure of offices factoriesand public places.

The operations of the Company were not interrupted and were carried out in the normalcourse in accordance with the directives issued by the Ministry of Home Affairs. Since theCompany is engaged in manufacturing of Sugar Generation of Power and production ofIndustrial Alcohol (including Ethanol) falling under the category of essentialcommodities.

The Company also started production of Sanitizers in order to cope up with the demandoccurred due to crisis.

The Company ensured the safety of its employees and is complying with all the normsrelated to social distancing thermal scanning wearing of face mask proper sanitizationand hygiene at all its factories.

The Work from Home policy has also been arranged for the employees of Corporate Officeof the Company.

There has been no material impact on the business of the Company and it does notforesee any material impact on the operational results and the financial health as sugarand the allied products which the Company is manufacturing are all essential commodities.

Consolidated Financial Statements and Subsidiary/ Associate & Joint VentureCompanies

The Consolidated Financial Statements of the Company are prepared in accordance withthe relevant Indian Accounting Standards issued by the Institute of Chartered Accountantsof India and forms an integral part of this Report.

As at March 31 2020 the Company has three subsidiary companies in terms of theprovisions of the Companies Act 2013 namely Dhampur International Pte Limited a WhollyOwned Subsidiary Overseas Ehaat Limited Wholly Owned Subsidiary and DETS LimitedSubsidiary of the Company.

The management of M/s Ehaat Limited a wholly owned subsidiary have decided to closedown its operations.

Pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014 a report on the performance and financial position of theSubsidiary Companies as per Companies Act 2013 is given in the Form AOC 1 as Annexure 2and forms an integral part of this Report.

DIPL (Dhampur International Pte Ltd.) has achieved the turnover of H 152.80 crores forthe year ended March 31 2020 as compared to H 208.45 crores last year.

Ehaat Limited has achieved the turnover of H 13.21 crores for the year ended March 312020 as compared to H 61.77 crores last year.

DETS Limited has achieved the turnover of H 0.26 crores for the year ended March 312020 as compared to Nil last year.

Audited Financial Statement for the subsidiary companies for FY 2019-20 have beenplaced on the website of the Company i.e. www.dhampur.com and are available forinspection at the Company's registered office and at the registered office of thesubsidiary company.

Material Changes and Commitments during the Year

There are no material changes and commitments affecting the financial position of theCompany which have occurred between March 31 2020 and at the date of the Report asrequired under Section 134(3) (l) of the Companies Act 2013.

Change in the Nature of Business

During the year there was no material change in the nature of business of the Company.

Dividend

During the period under review the Company had declared and paid Interim Dividend @60%i.e. H6.00 Per Equity Share of H10 each.

The Interim Dividend declared by the Board of Directors is proposed to be confirmed asFinal by Shareholders in the ensuing Annual General Meeting.

Reserves

The Company has earned Net Profit after tax of H211.37 Crores for the year ended March31 2020 which has been adjusted in Retained Earnings. During the year under review theCompany has transferred H0.38 Crores to Molasses Reserve Fund which is also is given inthe notes to Financial Statements forming part of this Report.

Share Capital

The paid up Equity Share Capital of the Company as at March 31 2020 stood at H66.38Crores (66387590 Equity shares of H10 each). During the year under review the Company hasnot issued any shares or convertible securities or shares with differential voting rightsnor has granted any stock option sweat equity or warrants.

Directors and Key Managerial Personnel

During the year under review there has been no change in the directorship of theCompany.

Shri Vijay Kumar Goel Shri Sandeep Kumar Sharma and Shri Gautam Goel shall retire byrotation at the ensuing Annual General Meeting and being eligible have offered themselvesfor re-appointment. Brief profile of Directors being reappointed is given in the Noticeconvening the ensuing Annual General Meeting of the Company.

Shri Nalin Kumar Gupta is Chief Financial Officer and Ms. Aparna Goel act as CompanySecretary of the Company.

During the year there has been no change in Key Managerial Personnel's of the Company.

Deposits

I. Accepted during the year: H11 55 53000.

II. Remained unpaid or unclaimed (excluding interest thereon) as at the end of theyear: H9130000.

III. If there has been any default in repayment of deposits or payment of interestthereon during the year and if so number of such cases and the total amount involved:

At the beginning of the year NIL
Maximum during the year NIL
At the end of the year NIL

It has been proposed to accept deposits from members and public subject to theapproval of shareholders in the ensuing Annual General Meeting and in accordance with theprovisions of the Companies Act 2013 and other applicable provisions if any.

Deposits not in compliance with Chapter V of the Act

The Company is in compliance with all the applicable provisions of the Companies Act2013.

Particulars of Loans Guarantees or Investment

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to Financial Statements forming partof this annual report.

Related Party Transactions

All the transactions carried out with related parties for the year under review were onarm's length basis which were duly approved by the Audit Committee and are in compliancewith the applicable provisions of the Companies Act 2013 and SEBI Listing Regulations.

There are no material significant related party transactions made by the Company withPromoters Directors or Key Managerial Personnel etc. which may have potential conflictwith the interest of the Company at large.

The Related Party Transactions Policy as approved by the

Board is uploaded on the Company's website at www. dhampur.com.

Your Directors draw attention of the members to Note No. 46 of the Standalone FinancialStatement which sets out related party disclosures.

ALL transactions entered with Related Parties for the year under review were on arm'slength basis and in the ordinary course of business and the provisions of Section 188 ofthe Companies Act 2013 and Rules made there under are not attracted. Thus disclosure inForm AOC-2 in terms of Section 134 of Companies Act 2013 is not required.

Credit Rating

CARE Ratings a Credit Rating Agency has assigned the credit rating of "CARE A;Stable (Single A; Outlook: Stable”) for Long term and short term Credit Facilitiesfrom Banks and Fixed Deposits of the Company respectively.

Auditors

Statutory Auditors and their Audit Report:

M/s. TR Chadha & Co. LLP Chartered Accountants (ICAI Firm Registration number006711N/N500028) and M/s. AtuL Garg & Associates Chartered Accountants (ICAI FirmRegistration number 001544C) are Joint Statutory Auditors of the Company and shallcontinue to be Statutory Auditors till the conclusion of Eighty Seventh Annual GeneralMeeting to be held in the year 2022. The report given by the Auditors on the Standaloneand Consolidated Financial Statements of the Company for the year ended March 31 2020forms part of this Annual Report and there is no qualification reservation adverseremark or disclaimer given by the Auditors in their reports.

The Auditors of the Company have not reported any fraud in terms of the second provisoto Section 143(12) of the Companies Act 2013 and therefore no detail is required to bedisclosed under Section 134 (3)(ca) of the Companies Act 2013.

Cost Accounts and Cost Auditors

The Company is required to maintain cost records pursuant to Section 148 of theCompanies Act 2013 and rules made thereunder and the same have been maintained incompliance with the provisions. M/s S.R Kapur (Cost Accountant KhatauLi) Cost Auditorsof the Company have duly submitted the Cost Audit Report for the period under review.

As per the requirement of Central Government and pursuant to Section 148 of theCompanies Act 2013 read with the Companies (Cost Records and Audit) RuLes 2014 asamended from time to time The Board of Directors on

the recommendation of Audit Committee has re-appointed Shri S.R. Kapur CostAccountant KhatauLi as Cost Auditors to audit the Cost Accounts of the Company for theFinancial Year 2020-21. As required under the Companies Act 2013 the remuneration payableto Cost Auditors is required to be placed before the members in ensuing Annual GeneralMeeting for their ratification. Accordingly a resolution seeking member's ratificationfor the remuneration payable to Shri S. R. Kapur Cost Auditors is incLuded in the Noticeconvening Annual General Meeting of the Company.

Internal Auditors

Pursuant to the provisions of Section 138 of the Companies Act 2013 The Board ofDirectors on the recommendation of Audit Committee has appointed M/s S S Kothari Mehta& Co. Chartered Accountants as Internal Auditors of the Company for the FinancialYear 2020-21.

Internal Financial Control

The Company's Internal Control system with reference to the financial statements areadequate and commensurate with the nature of its business and the size and complexity ofits operations. Periodic Audits and checks are conducted and the controls to preventdetect and correct irregularities in the operations have been Laid down by the Company.

Secretarial Auditors and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethere under the Company has appointed M/s. GSK & Associates Company Secretaries toundertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed asAnnexure 3 and forms an integral part of this report. There is no secretarial auditqualification for the financial year under review.

Annual Secretarial Compliance Report as required under Regulation 24A of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 as amended is also annexed asAnnexure 3A and forms part of this report.

Management Discussion and Analysis

The Management Discussion and Analysis Report on the operations of the Company asrequired under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isprovided in a separate section and forms an integraL part of this report.

Corporate Governance

As per SEBI (Listing ObLigations and DiscLosure Requirements) ReguLations 2015 aseparate section on Corporate Governance practices foLLowed by the Company together witha certificate from M/s. GSK & Associates a firm of Company Secretaries in Practiceconfirming compliance forms an integral part of this report.

Compliance with Secretarial Standards

The Company complies with all the applicable mandatory Secretarial Standards issued byThe Institute of Company Secretaries of India.

Directors Responsibility Statement

In accordance with the provisions of Section 134(5) of the Companies Act 2013 yourDirectors state that:

a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;

b) the Directors had selected such accounting policies and applied them consistentlyand made judgments 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 and Loss (including other comprehensive income) of the Company for that period;

c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

d) the annual accounts have been prepared on a going concern basis;

e) the Directors had laid down Internal Financial controls to be followed by theCompany and that such Internal Financial Controls are adequate and operating effectively;and

f) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

Declaration by Independent Directors

The Company has received declaration from all Independent Directors as under inaccordance with the provisions of Section 149(6) of Companies Act 2013 and Regulation 16of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and amendmentsthereto:

Shri Mahesh Prasad Mehrotra

Shri Priya Brat

Shri Ashwani Kumar Gupta

Shri Harish Saluja

Shri Rahul Bedi

Smt Nandita Chaturvedi

The Company has also received confirmation from all

the Independent Directors that they have not incurred disqualification under section164(2) of the Companies Act 2013 in any of the Companies in the previous financial yearand that they are at present stand free from any disqualification from being a Director.The Independent Directors have also confirmed their compliance with the Code forIndependent Directors as prescribed in Schedule IV to the Companies Act 2013 and alsothe Code of Conduct and Business Ethics for Board Members and Senior Management of theCompany.

Details of Board Meetings held during the year

The Board of Directors met five times during the Financial Year 2019-20. Details of theBoard Meetings and attendance at the meetings held during the Financial Year 2019-20 formspart of the Corporate Governance Report which forms part of this report.

Committees of the Board

The Board of Directors have following Committees:

Mandatory Committees:

Audit Committee.

Nomination and Remuneration Committee.

Stakeholders' Relationship Committee.

Corporate Social Responsibility Committee (CSR Committee).

The details of the Committees along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report forming part ofthis report.

Non Mandatory Committees

The Company has also constituted a committee named Finance Sub Committee in order tocarry out routine functions of the Company. The Committee met 13 (thirteen) times duringthe Financial Year 2019-20 on the following dates:-

April 4 2019 April 11 2019 May 21 2019 June 17 2019 July 8 2019 September 92019 October 23 2019 November 13 2019 November 25 2019 December 4 2019 January 32020 January 28 2020 and February 24 2020.

The Company has voluntarily formed Risk Management Committee for the purpose of RiskManagement by the Company.

Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and applicable Regulations of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Board hascarried out the evaluation of its own performance and that of the Board Committees viz.Audit Committee Nomination and Remuneration Committee CSR Committee and

Stakeholders' Relationship Committee as well as evaluation of the performance ofDirectors individually. A structured questionnaire was prepared after taking intoconsideration inputs received from the Directors covering various aspects of the Board'sfunctioning such as adequacy of the composition of the Board and its Committees Boardculture execution and performance of specific duties obligations corporate governancepractices and stakeholders' interests etc. A separate exercise was carried out toevaluate the performance of Individual Directors including the Chairman of the Board whowere evaluated on parameters such as level of engagement and contribution independence ofjudgement meeting risk management and competition challenges compliance and duediligence financial control safeguarding the interest of the Company and its minorityshareholders etc.

The performance evaluation of all the Directors including Independent Directors wascarried out by the entire Board. The performance evaluation of the Chairman andNonIndependent Directors was carried out by the Independent Directors. The Nomination andRemuneration Committee also carried out evaluation of every Director's performance afterlaying down criteria for evaluation by way of the aforesaid structured questionnaire. TheDirectors expressed satisfaction with the evaluation process and results thereof.

Nomination and Remuneration Policy

The Board of Directors have framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.Details of this policy are set out in the Corporate Governance Report which forms a partof this Report. The remuneration policy is in consonance with the existing policy of theCompany. The Nomination and Remuneration Policy as approved by the Board is uploaded onthe Company's website at www.dhampur.com.

Risk Management Policy

Risk Management Policy of the Company is in place for Risk assessment and mitigation.Risk procedures are periodically reviewed to ensure control on Risk through properlydefined framework. The Company's Risk Management strategy is integrated with its overallbusiness strategies and is communicated throughout the organisation. The Policyfacilitates in identification of risks at appropriate time and ensures necessary steps tobe taken to mitigate the risks.

Corporate Social Responsibility (CSR)

The composition of CSR committee is as under:

Shri Vijay Kumar Goel Chairman

Shri Gaurav Goel Member

Shri Mahesh Prasad Mehrotra Member

The Annual Report on CSR activities is annexed as per Annexure - 4 and forms anintegral part of this report. The CSR Policy as approved by the Board is uploaded on theCompany's website at www.dhampur.com.

Vigil Mechanism/Whistle Blower Policy

The Company has formulated Vigil Mechanism /Whistle Blower Policy for Employees andDirectors in order to keep high standards of ethical behaviour and provide safeguards towhistle blower.

The Vigil Mechanism/Whistle Blower Policy as approved by the Board is uploaded on theCompany's website at www. dhampur.com.

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 Workplace (Prevention Prohibition and Redressal)Act 2013. Internal Complaints Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees (permanent contractual temporarytrainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed duringthe year 2019-20.

No. of complaints filed NIL
during the financial year
No. of complaints received NIL
No. of complaints disposed NIL

Conservation of energy technology absorption foreign exchange earnings and outgo.

Details of conservation of energy technology absorption foreign exchange earnings andoutgo pursuant to Section 134 (3)(m) of the Companies Act 2013 read with the Rule 8(3) ofthe Companies (Accounts) Rules 2014 is annexed as Annexure 5 and forms an integral partof this report.

Extract of Annual Return

According to the provisions of Section 92(3) of the Companies Act 2013 the prescribedForm MGT-9 (Extract of Annual Return) is annexed as Annexure-6 and forms part of thisreport and is also available on the Company's website viz. www.dhampur.com

Significant and material orders passed by the regulators or courts or tribunalsimpacting the going concern status and Company's operations in future

There was no such order passed by the regulators or courts or tribunals impacting thegoing concern status and Company's operations in future.

Business Responsibility Report

Regulation 34(2) of the Listing Regulations as amended requires that the AnnualReports of the top 1000 listed entities based on market capitalisation (calculated as onMarch 31st of every financial year) shall include a Business Responsibility Report (BRR).As our Company comes under the same Business Responsibility Report is annexed as Annexure7 and forms part of this Board's report.

Human Resources and Industrial Relations

The Company takes pride in the commitment competence and dedication of its employeesin all areas of the business. The Company has structured induction process at alllocations and management development programmes to update skills of managers. Industrialrelations remained cordial and harmonious during the year.

Statutory Information

The Disclosure required under Section 197(12) of the Companies Act 2013 read with theRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is annexed as Annexure 1 and forms an integral part of this Report. A statementfurnishing the names of Top Ten employees in terms of remuneration drawn and personsemployed throughout the year who were in receipt of remuneration in terms of Rule 5(2) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isannexed as Annexure 8 and forms an integral part of this Report.

The above annexure is not being sent along with this Annual Report to the Members ofthe Company in line with the provisions of Section 136 of the Companies Act 2013. Memberswho are interested in obtaining these particulars may write to the Company Secretary atthe registered office of the Company twenty one days before and up to the date of theensuing Annual General Meeting during the business hours on working days.

None of the employees listed in the said annexure is a relative of any Director of theCompany. None of the employees hold (by himself or along with his spouse and dependentchildren) more than two percent of the Equity Shares of the Company.

Acknowledgements:

Your Directors place on record their acknowledgement and sincere appreciation to theshareholders for their confidence in the management of the Company the centralgovernment the state government banks and financial institutions for their continuedsupport the cane growers for their efforts in ensuring timely cane supply the Company'semployees for their relentless and dedicated efforts resulting in the Company's growthand look forward to a bright future.

For and on behalf of the Board of Directors
Vijay Kumar Goel
Place: New Delhi Chairman
Dated: June 02 2020 (DIN: 00075317)

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