To the Members
Your Directors have pleasure in submitting their 24 Annual Report of the Companytogether with the Audited Statements of Accounts for the year ended March 31 2016.
1. FINANCIAL RESULTS
The Company's financial performance for the year under review alongwith previous yearsfigures are given hereunder:
(Rs. In lacs)
| ||Current ||Previous |
|Particulars ||Year ended 31.03.2016 ||Year ended 31.03.2015 |
|Net Sales /Income from business operations ||85579.84 ||69790.27 |
|Other Income ||98.14 ||840.81 |
|Total Income ||85677.98 ||70631.08 |
|Less Interest ||9517.40 ||8658.40 |
|Profit before Depreciation ||4451.13 ||(5504.18) |
|Less Depreciation & Amortization Exp. ||2781.52 ||2652.77 |
|Profit after depreciation and Interest ||1669.61 ||(8156.95) |
|Less Current Income Tax ||- ||- |
|Less Previous year adjustment of Income Tax ||- ||- |
|Less Deferred Tax ||(3.23) ||(2659.19) |
|Net Profit after Tax ||1672.84 ||(5497.76) |
|Dividend (including Interim if any and final) ||- ||- |
|Net Profit after dividend and Tax ||1672.84 ||(5497.76) |
|Earning per share (Basic) ||1.09 ||(3.58) |
|Earning per Share (Diluted) ||1.09 ||(3.58) |
In view of inadequate profits during the current financial year your Directors areunable to recommend any dividend for the year under review.
3. REVIEW OF BUSINESS OPERATIONS AND FUTURE PROSPECTS
Your Directors wish to present the details of Business operations done during the yearunder review:
a. Production and Profitability
The sugar production of the country during 2015-16 (upto 30 April 2016) has gone to246.03 lakhs tones as compared to 276.04 lakhs tones of the year 2014-15.
The Company has crushed 16550666 qtls. of sugarcane and 2321280 qtls. of sugarbeets and has produced 1758135 qtls. of sugar during the year under review. The Companyhas also produced 855380 qtls. of molasses and 202928400 units of electricity20972254 BL of spirit and 2572375 cases of liquor.
The turnover of the Company has gone to Rs. 85677.98 Lacs as against Rs. 70631.08Lacs in the last year and the Company has earned net profit of Rs. 1672.84 lacs ascompared to loss of Rs. 5497.77 lacs during the last year.
c. Marketing and Market environment
Sugar industries is a seasonal industry. The production of sugar depends uponavailability of sugarcane which is affected by weather of the particular place. Thequality of soil deteriorates due to overuse of fertilizers and pesticides to increasesugarcane yield. The sugar sector in India goes through a phase of cyclicality mainly onaccount of situations of high cane pricing which is under Govt. control. The Company hasencourged sowing of sugar beet in its area and has crushed 2321280 qtls. of sugar beetin addition to sugarcane.
d. Future Prospects including constraints affecting due to Government policies.
The sugar production of the country has gone to 246.03 lacs tons during current season.Due to improvement of market sentiments there are better lifting of sugar during currentseason. Government of India announced certain incentives for export of sugar upto 31March 2016 resulting into export of about 13.5 lacs tons of sugar by Sugar Mills. Withthe improvement of domestic market it is expected that cane price payments to the canegrowers will improve and cane arrear will come down substantially in future.
4. MATERIAL CHANGES AND COMMITMENTS
No material changes or commitments have occurred between the end of the financial yearto which the financial statements relate and on the date of this report affecting thefinancial position of the company.
There was no change in the Directorship of the Company during the year.
Rana Ranjit Singh and Rana Veer Pratap Singh Directors are liable to retire byrotation and being eligible offers themselves for re-appointment.
Particulars of Directors seeking appointment/re-appointment have been given in theCorporate Governance annexed to the Directors Report.
6. DIRECTORS' RESPONSIBILITY STATEMENT
In Accordance with the provisions of Section 134(3)(c) of the Companies Act 2013 theBoard hereby submit its responsibility Statement:
a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b) the directors had 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 had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the directors had prepared the annual accounts 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 were operatingeffectively; and
f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
7. KEY MANAGERIAL PERSONNEL (KMP)
During the financial period ended 31.3.2016 following persons are Whole Time KeyManagerial Personnel (KMP) of the Company in terms of provisions of Section 203 of theCompanies Act 2013:
|Sl. No. ||Name ||Designation |
|1. ||Rana Inder Pratap Singh ||Managing Director |
|2. ||Mr. Manmohan K Raina ||Company Secretary |
|3. ||Mr. Manoj Gupta ||Chief Financial Officer |
8. MEETINGS OFTHE BOARD
During the financial year ended 31.3.2016 eight Board Meetings were held. The detailsof the Board Meetings are given in the Corporate Governance Report. The intervening gapbetween the Meetings was within the period prescribed under the Companies Act 2013 andthe SEBI (LODR) Regulations 2015.
9. DECLARATION FROM INDEPENDENT DIRECTORS
All Independent Directors of the Company have given declarations that they meet thecriteria of independence as laid down under Section 149(6) of the Companies Act 2013 andSEBI (LODR) Regulations 2015.
10. INTERNAL FINANCIAL CONTROLS
The Company has over the years evolved effective systems and procedures to ensureinternal financial controls in all its establishments. An internal audit process is inplace under the overall supervision of the Audit Committee of the Board. Qualified andexperienced professionals are engaged to ensure effective and independent evaluation ofinter alia the internal financial controls. The appointment of internal auditors isapproved by the Board on recommendations of the Audit Committee. The Audit Committee alsolays down the schedule for internal audit.
Internal audit reports are placed before the Committee with management comments.Suggestions are implemented and reported to the Audit Committee. An effectivecommunication/ reporting system operates between the Units and Corporate Office to keepvarious establishments abreast of regulatory changes and ensure compliances.
11. STATUTORY AUDITORS ANDTHEIR REPORT
M/s. Kansal Singla & Associates Chartered Accountants Chandigarh were appointedas Statutory Auditors from the conclusion of the last Annual General Meeting to thisAnnual General Meeting of the Company. Their continuance of appointment and payment ofremuneration are to be confirmed and approved in the ensuing Annual General Meeting. TheCompany has received a certificate from the above Auditors to the effect that if they arereappointed it would be in accordance with the provisions of Section 141 of the CompaniesAct 2013.
12. COST AUDITORS
M/s Khushwinder Kumar & Co. Cost Accountants (Firm Registration No 100123) werere-appointed as Cost Auditors of the Company for conducting the audit of the cost recordsmaintained by the Company for the financial year 2016-17 subject to the approval of theMembers on the remuneration to be paid to the Cost Auditors. A certificate from them hasbeen received to the effect that their appointment as Cost Auditors of the Company ifmade would be in accordance with the limits specified under Section 141 of the CompaniesAct 2013 and rules framed there under.
13. 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. A. Arora & Co. a firm of CompanySecretaries (C.P.No.993) to undertake the Secretarial Audit of the Company. TheSecretarial Audit Report in prescribed format MR-3 given by aforesaid Secretarial Auditorsis annexed to this Board Report as Annexure 'F' and forms an integral part.
The Secretarial Auditor has neither qualified the Secretarial Audit Report nor givenany adverse remark for which explanation may be required to be given in the Directors'Report.
14. FIXED DEPOSITS
The Company does not have any deposits and has neither accepted any deposits during thefinancial period ended 31 March 2016.
15. RISK MANAGEMENT
Risks are an integral part of any business and the risk profile to a great extentdepends on the climatic conditions economic and business conditions and the markets andcustomers we serve.
The Company has adopted a 'Risk Management Policy' which is reviewed on a periodicbasis in order to recognize and reduce exposure to risks wherever possible. The Company'srisk management policies are based on the philosophy of achieving substantial growth whilemitigating and managing risks involved.
Few of the risks associated with our businesses are enumerated below:
Fluctuations in demand and price for finished products viz. sugar molasses etc.
Fluctuations in the price and availability of key raw materials includingsugarcane raw sugar and sugar beet.
Increase in interest rates.
Changes in government policies affecting the sugar industry in India.
Accidents natural disasters or outbreaks of disease in sugarcane.
16. AUDIT COMMITTEE
The Audit Committee comprises of three Directors all directors are independentDirector. The details of terms of reference of the Audit Committee number and dates ofmeeting held attendance among others are given separately in the attached CorporateGovernance Report.
17. NOMINATION AND REMUNERATION COMMITTEE
Pursuant to the provisions of Section 178 of the Companies Act 2013 read with Rulesmade there under the Board has constituted a Nomination & Remuneration Committee andthe details of terms of reference number & dates of meeting held attendance andother details are given separately in the attached Corporate Governance Report. The Boardon the recommendation of Nomination & Remuneration Committee framed a policy i.e.Nomination and Remuneration Policy for selection and appointment of Directors seniormanagerial personnel and their remuneration. The aforesaid policy can be accessed on theCompany's website www.ranasugars.com
18. COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT PAYMENT OF REMUNERATION AND
DISCHARGE OFTHEIR DUTIES
The Company's Policy relating to appointment of Directors payment of Managerialremuneration Directors' qualifications positive attributes independence of Directorsand other related matters as provided under Section 178(3) of the Companies Act 2013 isfurnished in Report on Corporate Governance.
19. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL
The Company has not developed and implemented any Corporate Social Responsibilityinitiatives as the said provisions are not applicable.
20. CONSERVATION OF ENERGYTECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS
The information relating to conservation of energy technology absorption and foreignexchange earnings and outgo as required under Section 134(3) (m) of the Companies(Accounts) Rules 2014 is enclosed as Annexure - A and forms part of this Report.
21. PARTICULARS OF EMPLOYEES
During the financial period ended 31.3.2016 there is no employee in the Company who isreceiving remuneration more than Rs. 5 lacs per month or Rs. 60 lacs per annum.
22. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loan or investments made under Section 186 of theCompanies Act 2013 during the year. However the Company has given guarantee to the Banksfor crop loans to the cane growers of the area of Rs. 6159.98 lacs against Rs. 5858.34lacs of the last year.
23. RELATED PARTYTRANSACTIONS
There was no contract or arrangements made with related parties as defined underSection 188 of the Companies Act 2013 during the year under review.
24. VIGIL MECHANISM
The Company has formulated and implemented the Whistle Blower Policy / Vigil Mechanism.This has provided a mechanism for directors and employees of the Company and other personsdealing with the Company to report to the Chairman of the Audit Committee; any instance ofunethical behavior actual or suspected fraud or violation of the Company's code ofconduct. The aforesaid policy has also been uploaded on the Company's website.
25. EXTRACT OF ANNUAL RETURN
The extracts of the Annual Return (MGT-9) as per the provisions of Section 92 of theCompanies Act 2013 read with Rule 12 of Companies (Management and Administration) Rules2014 is annexed herewith and marked as Annexure E to this Report.
26. CORPORATE GOVERNANCE
In accordance with SEBI (LODR) Regulations 2015 Corporate Governance Report alongwith Auditors' certificate thereon and Management Discussion and Analysis Report form partof this report are enclosed as Annexure- B.
27. SHARE CAPITAL
During the financial period ended 31.3.2016 the Company has not issued any sharecapital with different voting rights sweat equity or ESOP nor provided any money to theemployees or trusts for purchase of its own shares.
The Directors wish to thank and deeply acknowledge the cooperation assistance andsupport extended by Central Government State Governments Banks Financial InstitutionsDealers and Vendors of the Company. The Directors also wish to place on record theirappreciation for the all-round co-operation and contribution made by the employees at alllevels.
| ||For & on behalf of the Board of Directors || |
| ||Rana Inder Pratap Singh ||RanaVeer Pratap Singh |
|Place: Chandigarh ||Managing Director ||Director |
|Dated: 12.08.2016 ||DIN: 00075107 ||DIN: 00076808 |