To the Members
Your Directors have pleasure in submitting their 26th Annual Report of theCompany together with the Audited Statements of Accounts for the year ended March 312018.
1. FINANCIAL RESULTS
The Company3s financial performance for the year under review along with previous yearsfigures are given hereunder :
| || ||(Rs. In lakhs) |
|Particulars ||Current Year ended 31.03.2018 ||Previous Year ended 31.03.2017 |
|Revenue from Business Operations ||98767.04 ||114670.11 |
|Other Income ||704.46 ||154.05 |
|Total Income ||99471.51 ||114824.16 |
|Less Interest ||9893.83 ||9013.83 |
|Profit /(Loss) before Depreciation & Amortization Exp. ||(5574.66) ||(964.64) |
|Less Depreciation & Amortization Exp. ||3139.42 ||2841.85 |
|Profit/ (Loss) after depreciation and interest ||(8714.08) ||(3806.49) |
|Less Current Income Tax ||-- ||-- |
|Less Previous year adjustment of Income Tax ||-- ||-- |
|Less Deferred Tax ||(64.45) ||705.81 |
|Profit/(Loss) after Tax ||(8649.62) ||(4512.30) |
|Dividend (including interim if any and final) ||-- ||-- |
|Other Comprehensive income not to be reclassified to profit or loss in subsequent periods : || || |
|- Re-measurement gains/ (losses) on defined benefit plans ||(9.90) ||18.60 |
|- Income tax effect ||3.06 ||(5.75) |
|Other comprehensive income/(loss) for the year net of tax ||(6.84) ||12.85 |
|Total comprehensive income for the year net of tax attributable to : ||(8656.46) ||(4499.45) |
|- Earning per share (Basic) ||(5.63) ||(2.94) |
|- Earning per Share (Diluted) ||(5.63) ||(2.94) |
The financial statements of the Company have been prepared in accordance with IndianAccounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards)Rules 2015 (as amended from time to time). For all periods up to and including the yearended 31 March 2017 the Company prepared its financial statements in accordance withaccounting standards notified under the section 133 of the Companies Act 2013 readtogether with paragraph 7 of the Companies (Accounts) Rules 2014 (Indian GAAP). Thesefinancial statements for the year ended 31 March 2018 are the first financial statementswhich have been prepared in accordance with the Ind AS notified under the Companies IndianAccounting Standards Rules 2015 as amended from time to time. The Company is in Phase IIof Ind AS adoption and accordingly the date of transition is 1st April 2016. Inrespect of financial information for the year ended 31st March 2018 theCompany followed the same accounting policies and accounting policy choices (bothmandatory exceptions and optional exceptions availed as per Ind AS 101) as initiallyadopted on transition date i.e. 1st April 2016. The Company has preparedfinancial statements which comply with Ind AS applicable for periods ending on 31 March2018 together with the comparative period data as at and for the year ended 31 March2017.
In view of losses suffered during the current financial year your Directors are unableto 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 2017-18 is expected to reach 315 lakhs tonesas against last year production of 203 lakhs tones. Your Company has crushed 25188797qtls. of sugarcane and 3187930 qtls. of sugar beets and has produced 2775145 qtls. ofsugar during the year under review. The Company has also produced 1290702 qtls. ofmolasses and 263969514 units of electricity 4472026 BL of spirit 19711959 BL ofethanol and 1016080 cases of liquor.
The turnover of the Company has come down to Rs. 98767 Lakhs as against Rs.114670Lakhs in the last year and the Company has suffered loss of Rs. 8656.46 lakhs during theyear. This is due to steep fall in sugar price & molasses rate during the year.
c. Marketing and Market environment
The Government of India has continued with the decontrol mechanism. Due to steep fallin sugar prices there is huge loss of Rs. 8656.46 Lakhs during the year. The Government ofIndia is taking various steps to stabilize sugar price. It has allowed export of sugarproviding 20 lakhs MT minimum indicate export quota (MIEQ). It has fixed minimum sugarprice and increased the price of ethanol.
d. Future Prospects including constraints affecting due to Government policies.
The sugar price has gone down by 25% in the season and is presently below the averagecost of production.
The Company is now trying to find new varieties of cane which give high recoverybesides encouraging sowing of sugar beet in its area.
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.
Rana Ranjit Singh and Rana Veer Pratap Singh Directors are liable to retire byrotation and being eligible offers themselves for reappointment.
Particulars of Directors seeking appointment/re-appointment have been given in theCorporate Governance annexed to the Directors3 Report.
6. DIRECTORS3 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 annualaccounts the applicable accounting standards had been followed along with properexplanation relating to material departures; b) the directors had selected such accountingpolicies and applied them consistently and made judgements and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany at the end of the financial year and of the profit/Loss of the Company for thatperiod; c) the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets 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) thedirectors had laid down internal financial controls to be followed by the company and thatsuch internal financial controls are adequate and were operating effectively; and f) thedirectors had devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
7. KEY MANAGERIAL PERSONNEL (KMP)
During the financial period ended 31.03.2018 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 OF THE BOARD
During the financial year ended 31.03.2018 four 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 internal control systems which is commensurate with its size natureand volume of operations.
11. STATUTORY AUDITORS AND THEIR REPORT
M/s. N J & Associates Chartered Accountants (Firm Registration No. 023083N) hassubmitted their resignation from the auditorship of the Company and shown theirunwillingness to continue as auditor of the Company. As per the Companies Act 2013 a newfirm M/s. Ankush Arora & Associates Chartered Accountants (Firm Registration No.30578N) has been recommended for appointment as Statutory Auditors of the Company for aterm of 5 years from the conclusion of the forthcoming Annual General Meeting of theCompany. They have confirmed their eligibility under Section 141 of the Act and the Rulesframed thereunder for their appointment as Auditors of the Company.
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 2018-19 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. TheSecretarial Auditor has neither qualified the Secretarial Audit Report nor given anyadverse 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 March 31 2018.
15. RISK MANAGEMENT POLICY
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. Your Company continues to review and manage therisks emanating from such a dynamic environment at periodic intervals. The major risksfaced by the industry include sugarcane availability price realization and regulatorycontrol by Government and financial liquidity amongst others.
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 ANDDISCHARGE OF THEIR 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 SOCIALRESPONSIBILITY INITIATIVES
The Company's policy relating to Corporate Social Responsibility is furnished in theCorporate Governance Report.
20. CONSERVATION OF ENERGY TECHNOLOGY 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 31.03.2018 there is no employee in the Company whois receiving remuneration more than Rs.5 lakhs per month or Rs.60 lakhs 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.
23. RELATED PARTY TRANSACTIONS
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. WHISTLE BLOWER POLICY/ 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 C&D respectively.
27. SHARE CAPITAL
During the financial period ended 31.03.2018 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 ||Rana Veer Pratap Singh |
|Place: Chandigarh ||Managing Director ||Director |
|Dated: 13.08.2018 ||DIN: 00075107 ||DIN: 00076808 |
ANNEXURE - A
ANNEXURE TO THE DIRECTORS REPORT
FOR THE YEAR ENDED 31ST MARCH 2018
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGOPURSUANT TO THE PRIVISONS OF SECTION 134(3) (M) OF THE COMPANIES ACT 2013 READ WITH THECOMPANIES (ACCOUNTS) RULES 2014.
1. CONSERVATION OF ENERGY
The Company has installed most modern equipment to save and minimise energyconsumption. The Company has installed three Turbo Alternators sets with power generationcapacity of 87500 KW. The entire requirement of power is met through captive generation.The Company has also made stand by arrangement of Diesel Generating Sets.
To achieve maximum conservation of energy the Company has put up high pressure boilersand matching Turbo alternators and prime movers. The Company has also installed electricalmotors of appropriate size and continuous centrifugals in place of batch typecentrifugals.
|A. Electricity || || |
| ||Year ended 31.03.2018 ||Year ended 31.03.2017 |
|Purchased || || |
|- Sugar || || |
|- Unit Purchased ||2134595 ||3176029 |
|- Total Amount (Rs.) ||17779130 ||25476019 |
|- Rate Per Unit (Rs.) ||8.33 ||8.02 |
|Own Generation || || |
|- Sugar || || |
|- Through D.G. Set (Sugar Division) Units Generated ||164039 ||96595 |
|- Units Generated per litre of Diesel Oil ||5.66 ||3.71 |
|- Cost Per Unit (Rs.) ||10.38 ||15.04 |
|- Through Steam Turbine (Sugar Division) Units Generated ||263969514 ||245157800 |
|- Unit Generated per Qtl. of Fuel ||36.68 ||49.75 |
|- Cost Per Unit Electricity (Rs.) ||2.26 ||1.97 |
|- Distillery || || |
|- Through D.G. Set || || |
|- Units Generated ||184690 ||276026 |
|- Units Generated per litre of Diesel Oil ||3.44 ||3.48 |
|- Cost Per Unit (Rs.) ||16.33 ||9.65 |
|- Through Steam Turbine Units Generated ||12728340 ||10929208 |
|- Unit Generated per Qtl. of Fuel ||34.52 ||25.91 |
|- Cost Per Unit Electricity (Rs.) ||2.71 ||2.81 |
|B. Consumption Per Unit of Product || || |
|- Sugar || || |
|- Electricity (KW/MT) ||288.29 ||340.35 |
|- Fuel (MT/MT) ||1.99 ||2.32 |
|- Steam (MT/MT) ||4.30 ||5.96 |
|- Distillery || || |
|- Electricity (KW/KL) ||544.08 ||488.63 |
|- Fuel (MT/KL) ||1.52 ||1.84 |
|- Steam (MT/KL) ||5.95 ||7.17 |
|C. Technology Absorption || || |
|i) Research & Development || || |
|a) Research & Development has continuously been carried out for improvement in quality of sugarcane and to increase the area under the sugarcane crop which will ensure its greater availability resulting into more production & better quality of cane and higher yield there by directly reducing the cost of production. || || |
|b) The Company is trying to improve quality of Cane & ensure development of Cane by providing various facilities to the Cane growers. || || |
|c) Amount incurred on Research & Development (Rs. in lakhs) ||2.13 ||1.64 |
|ii) Technology Absorption Adoption and innovation. || || |
|a) Latest technology has been adopted in the plant to maximise production yield and better quality along with minimum consumption of energy. || || |
|b) Technology Imported ||Nil ||Nil |
|D. FOREIGN EXCHANGE EARNING & OUTGO || || |
|a) Foreign Exchange Earning ||13.18 ||17.24 |
|b) Foreign Exchange Outgo (Rs. in lakhs) ||541.60 ||573.07 |
| ||For & on behalf of the Board |
|Place : Chandigarh ||Rana Inder Pratap Singh ||Rana Veer Pratap Singh |
|Date : 13-08-2018 ||Managing Director ||Director |