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Usher Agro Ltd.

BSE: 532765 Sector: Agri and agri inputs
NSE: USHERAGRO ISIN Code: INE235G01011
BSE 00:00 | 29 Mar Usher Agro Ltd
NSE 05:30 | 01 Jan Usher Agro Ltd
OPEN 1.27
PREVIOUS CLOSE 1.27
VOLUME 15140
52-Week high 1.27
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 10
Buy Price 1.27
Buy Qty 50.00
Sell Price 1.27
Sell Qty 50.00
OPEN 1.27
CLOSE 1.27
VOLUME 15140
52-Week high 1.27
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 10
Buy Price 1.27
Buy Qty 50.00
Sell Price 1.27
Sell Qty 50.00

Usher Agro Ltd. (USHERAGRO) - Chairman Speech

Company chairman speech

TO THE SHAREHOLDERS

It is my pleasure to welcome you to the 21st Annual General Meeting of your Company andpresent before you the Annual Report with audited accounts.

The year 2015-16 and 2016-17 were the most challenging that your Company has seen inyears. Despite being one of the market leaders in the food processing sector on accountof several factors beyond the control of the Company huge stress was created in theaccount of the Company. The reason inter alia include i) International markets hadremained subdued for a considerable period of time and therefore market conditions hadbeen unfavourable for Indian Rice Exporters in the financial year 2014-15 which severallyaffected the business of the Company. ii) A ban imposed by Iran (largest importer ofBasmati rice from India) in October 2014 to protect its domestic rice industry. Thisresulted in over-supply in the domestic market and consequential decline in the prices ofBasmati rice affecting sales and profitability (iii) Food Corporation of India over theyears procured 340-350 lakh MT of non-Basmati in a year. However since 2013 there was adrastic decline in the procurement by Food Corporation of India resulting in over supplyof non-Basmati rice affecting prices sales and profitability (iv) the Company was unableto avail sanction from banks in consortium after FY 2015-16 (iv) The Company has twosubsidiaries i.e. Usher Eco Power Limited and Usher World Wide FZE in which the Companyhas made substantial investments. Usher Eco Power Limited is expanding its powergeneration and setting up a silica plant. These investments have not yet startedgenerating returns. Despite the unfavourable conditions the Company was regular inrepayment of the dues upto FY 2015-16. In such unfavourable conditions the Company washaving multiple banking arrangements due to which the Company went into financial distressand started committing defaults in repayments of multiple loans. The Company states thatwith continuing adverse conditions for the business of the Company by the beginning ofthe year 2016 huge stress was created in the account of the company.

On account of the reasons mentioned above the Company's business operations have facedcertain difficulties temporarily affecting its performance. This downturn faced across bythe Company is being experienced across all industry players for multifold reasonsmentioned above. However the Company is taking all possible efforts to meet with thechallenges faced by the entire industry and is positively working towards its revival.

The above mentioned difficulties faced by the Company in its business operations havealso been promptly brought to the notice of all lenders/ financial institutions with whomthe Company has banking relationship. The Company has been transparent in keeping itslenders fully informed about the industry problems and has from time to time soughtcooperation and discussed modalities which would enable the Company to continue itsbusiness operations and at the same time honour its commitments made to its lenders/financial institutions.

Taking cognizance of the seriousness of difficulties faced by the industry and theCompany all lenders of the Company have assured full cooperation by providing variousalternatives to the Company. In this regards several joint meetings of all the lendershave been conducted with a consistent approach of formulating action plans for the benefitof the Company. In the circumstances pursuant to the extant directions framed by ReserveBank of India dated. February 26 2014 on ‘Revitalizing Distressed Assets in theEconomy – Guidelines on Joint lenders Forum (JLF) and Corrective Action Plan (CAP)'(the ‘JLF Guidelines') the lenders of the Company identified the stress in theaccount of the Company and reported the account of the Company to CRILC in the category ofSMA-2 and accordingly as mandatorily required under the the JLF Guidelines all the lendersof the Company formed a committee of Joint Lenders' Forum (JLF) on 16th March 2016.

The representatives of the lenders and the Company are privy to these JLF meetings anddiscussions as well as the positive position taken by the other lenders. Therepresentatives of Lenders have from time to time appeared in the meetings of the JLF andfully participated in the entire process. Since the time of constitution of JLF allparticipants of the JLF have regularly had meetings with the representatives of theCompany and monitored the financial progress of the Company closely.

In the above JLF meetings for the purpose of working towards revival of the Companythe Company as well as the lenders have amongst other aspects also proactively discussedand worked on aspects of exploring alternate business plans approaching potentialinvestors and other possibilities.

Accordingly in the meeting of the JLF members held on May 13 2016 the lenderscollectively agreed that the SDR Scheme of RBI is a viable option to proceed withrestructuring of the account and further agreed that under Strategic Debt restructuring(SDR) scheme was a viable option to preserve the value of the Company and adopted the"Reference Date" for the purpose as May 13 2016. In pursuance of the SDRScheme the Board of Directors of the Company in their meeting held on December 08 2016had allotted 39612472 equity shares @ Rs. 11.09 per share to the JLF lenders of theCompany and that the said shares have been dematerialised into the respective Demataccount of the lenders after following due procedures.

The Company has co-operated in all possible ways to ensure that corrective action planssuggested by all the lenders of the JLF to the Company are implemented smoothly as desiredby the lenders. The co-operation and bona fide of the Company is clearly established fromthe fact that the promoters of the Company has even agreed to being reduced to a minorityshareholder and the lenders becoming the majority shareholder. This is one of the caseswhere equity shares under SDR Scheme have been allotted to the lenders and are also listedon the Stock Exchanges namely BSE and NSE. This purports the intent of the promoters tocooperate and resolve the genuine problem faced by the company.

I would like to express my gratitude to all our stakeholders our customers vendorspartners bankers investors and our employees for their continued faith and support.

Yours faithfully

Vinod Kumar Chaturvedi

Managing Director & CFO