The Directors have pleasure in presenting the 24th Annual Report of the Company along
with Audited Accounts for the year ended 31st March, 2013.
The results for the year ended 31.3.2013 and 31.3.2012 are as under:
(Rs. in crores)
|Profit before depreciation, finance cost, tax and exceptional item
|Profit before exceptional item and tax
|Profit/(Loss) before Tax
|Provision for Taxation
|Profit/(Loss) after tax
|Balance brought forward from previous year
|Net Profit available for appropriation
|- Proposed Dividends on Equity Shares (Incl. Interim dividend)
|- Corporate Dividend Tax
|- Storage fund for Molasses Account
|- General Reserve
|- Balance Carried Forward
The Company has delivered a healthy performance during the year. The Net Revenues were
up by 10% at Rs. 5539 Crores as against Net Revenue of Rs. 5039 Crores in the previous
year. The growth in revenues were driven by growth in Sugar (up by 48%), Shriram Farm
Solutions (up by 20%) and Chloro-Vinyl (up by 15%) businesses.
On the earnings, EBITDA of the company recorded a growth of 57% at Rs.574 Crores. PBIT
(before exceptional items) grew by 106% at Rs.427 Crores. The key drivers of the growth
for PBIT (before exceptional items) during the year were higher earnings in the
Chloro-Vinyl business, driven by cost savings and better product prices, higher earnings
in the Sugar business along with lower losses from the Hariyali business. Lower losses in
the Hariyali business was result of the implementation of restructuring and
rationalization plan which involved restricting activities to profitable ones only.
The Company, however, also faced challenges in businesses like Shriram Farm Solutions
and Bioseed due to adverse weather conditions in some regions of operations. The Company
also faced challenges in the Government controlled businesses like Sugar and Fertilizers.
The Company, during the year had to account for an exceptional item of Rs.53.6 Crores
which is a charge on account of losses on sale of surplus assets and expenses, consequent
to company`s decision to restructure and rationalize Hariyali Kisaan Bazaar`s operations
to restrict its activities to profitable lines only.
The Company`s finance costs were lower by 3% at Rs.155 Crores due to lower Net Debt.
Net Debt stood at Rs.1386 Crores as compared to Rs.1521 Crores. The debt could have been
lower, however, higher subsidy outstanding from the Government on account of Fertilizer
subsidy and higher Sugar stocks led to higher requirement of working capital.
Profit before tax (before exceptional item) was higher at Rs.272 Crores in FY13 as
compared to Rs.48 Crores in the previous year.
Net Profit for FY 13 was higher at Rs.203 Crores as compared to Net profit of Rs.12
Crores in the previous period.
The improved financial performance of the company has led to Short term debt rating
being upgraded from A2+ to A1 and Long term rating being upgraded from A- to A. Both these
ratings are from ICRA.
Your Directors are pleased to recommend final dividend @ 40% i.e. Re.0.80 per Equity
Share of Rs.2/- each for the year ended 31.3.2013. The total dividend for the financial
year 2012-2013 results to 80% i.e. Rs.1.60 per equity share of Rs.2/- each (including
interim dividend paid @ 40% in February, 2013).
In terms of Circular dated 8.2.2011, issued by the Ministry of Corporate Affairs,
general exemption has been granted from the provisions of Section 212 of the Companies
Act, 1956 to Companies in relation to attaching accounts of its subsidiaries, subject to
fulfillment of the conditions mentioned in the circular and necessary conditions as
stipulated have been complied with by the Company. The Company will make available these
documents upon request by any Member of the Company, interested in obtaining the same and
shall also be kept for inspection at the Registered Office of the Company. However, as
directed by the Central Government, the financial data of the subsidiaries have been
furnished under `subsidiary companies particulars` forming part of the Annual Report.
Further, pursuant to Accounting Standard AS-21 issued by The Institute of Chartered
Accountants of India, Consolidated Financial Statements presented by the Company in this
Annual Report includes the financial information of its subsidiaries.
Merger of Bioseed Research India Limited into the Company
The Directors in their meeting held on 17.12.2012, had approved in principle, the
proposal of merger of Bioseed Research India Ltd. (100% subsidiary) into the Company to be
effective from the appointed date i.e.1st April, 2013.
Subsequently, the said Scheme of Arrangement has been approved by the Hon`ble High
Court of Delhi on 22.3.2013.
This Merger will enable the Company to strengthen its balance sheet and leverage the
cash flows of the Transferor Company for financing the growth of bioseed business of the
As on 31st March, 2013, 30 deposits aggregating to Rs.6.83 lacs were unclaimed. Since
then, 30 deposits amounting to Rs.6.83 lacs have been claimed/renewed.
Unclaimed Shares Suspense Account
Pursuant to complying with the requirement of Clause 5A of Listing Agreement, the
Company had transferred unclaimed shares into Unclaimed Shares Suspense Account after
sending three reminders to those shareholders whose shares are lying as unclaimed.
As on 1st April, 2012, 4568 folios aggregating to 679510 shares of Rs.2/- each were
unclaimed. As on 31st March, 2013, 4563 folios aggregating to 678210 shares of Rs.2/- each
were unclaimed. Since then, 5 Shareholders holding 3850 shares of Rs.2/- each has
approached and out of which 2650 shares of Rs.2/-each have been transferred. The voting
rights on the shares lying in Unclaimed Shares Suspense Account shall remain frozen till
the rightful owner of such shares claims the shares.
The Company is conscious of its responsibility as a good corporate citizen and is
committed to adherence to best corporate governance practices. A separate section on
Management Discussion and Analysis, Corporate Governance and a Certificate from the
Auditors of the Company regarding compliance of conditions of Corporate Governance as
stipulated under Clause 49 of the Listing Agreement(s) with the Stock Exchange(s) form
part of the Annual Report.
Shri Ajit S. Shriram, Shri Pradeep Dinodia and Dr. N.J.Singh, Directors, retire by
rotation and are eligible for re-appointment.
Re-appointment of Shri Ajay S. Shriram as Chairman & Sr. Managing Director and Shri
Vikram S.Shriram as Vice Chairman & Managing Director, is being sought in the ensuing
Annual General Meeting (AGM) of the Company for a period of five years w.e.f. 1.11.2013.
The requisite details of the re-appointments are mentioned in the said AGM Notice.
M/s. Deloitte Haskins and Sells, Chartered Accountants, retire at the forthcoming
Annual General Meeting and are eligible for re-appointment.
The Company has appointed M/s. Bahadur Murao & Co., Cost Accountants, New Delhi as
Cost Auditors for the financial year 2013-14, to audit the cost accounting records for its
products namely, Fertilisers, Chemicals, Cement, PVC, UPVC Articles, Textiles and Seeds.
The Company has appointed M/s. J.P. Sarda & Associates, Cost Accountants, Kota as
Cost Auditors for the financial year 2013-14 for Sugar and Power selling plants.
The Company has filed Cost Audit Reports for the financial year 2011-12 on 31.1.2013,
for its various products, which were due to be filed by 28.2.2013. The due date of filing
Cost Audit Reports for the financial year 2012-13 is 27th September, 2013.
In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the
Companies (Particulars of Employees) Rules, 1975 and amendments thereto, the names and
other particulars of the employees are required to be set out in the Annexure to the
Directors` Report. However, as per the provisions of Section 219(1)(b)(iv) of the Act, the
report and accounts are being sent to all the Members excluding the aforesaid particulars.
The complete Annual Report including this statement shall be made available for inspection
by any Member during the working hours from 11.00 A.M. to 1.00 P.M. on all the working
days for a period of 21 days before the date of the Annual General Meeting. Any Member
interested in obtaining a copy of the said statement may write to the Company Secretary at
the Registered Office of the Company.
Directors` Responsibility Statement
It is hereby affirmed that
1. in preparation of annual accounts, all applicable accounting standards have been
2. the accounting policies of the Company have been consistently followed. Wherever
circumstances demanded, estimates have been made that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company at the end of the
financial year and of the profit or loss of the Company for that period,
3. proper and sufficient care has been taken for maintenance of accounting records in
accordance with the provisions of the Companies Act, 1956 for safeguarding assets of the
Company and proper internal controls are in place for preventing and detecting frauds and
other irregularities, and
4. annual accounts have been prepared on a going concern basis.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings/Outgo
The information required under Section 217(1)(e) of the Companies Act, 1956 read with
the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules,
1988 with respect to these matters is appended hereto and forms part of this report.
The Company continued to maintain harmonious and cordial relations with its workers in
all its Divisions, which enabled it to achieve this performance level on all fronts.
The Directors wish to thank customers, the Government authorities, financial
institutions, bankers, other business associates and shareholders for the co-operation and
encouragement extended to the Company. The Directors also place on record their deep
appreciation for the contribution made by the employees at all levels.
||On behalf of the Board
||(AJAY S. SHRIRAM)
|2nd May, 2013
||Chairman & Sr. Managing Director
Annexure to the Directors Report
Information as required under Section 217(1)(e) read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988.
A. CONSERVATION OF ENERGY
(a) Energy Conservation Measures Taken:
Energy conservation has been an important thrust area of the management and is being
continuously monitored. Important specific actions taken during this year are:
Periodical energy audits, pressure drop reduction measures and optimization of
operating parameters in the Fertiliser Plant.
Optimizing the carbon recipe, using sized/ briquetted material, reducing fines.
VFD has been provided for motor of Acetylene Blower to regulate flow matching
VFDs have been provided on reciprocating feeders (4 Nos) of Acetylene Generators
to regulate carbide feed rate.
Replacement of KF cooling tower ID Fan aluminum blades with energy efficient FRP
Change in operating practice of drum filter operations there by stoppage of
agitator of sludge tank.
Reduction in operation time of nitrogen compressors by replacement of CMS.
Implementation of power saving schemes like modifications in discharge
arrangement of drum filter filtrate water for gravity discharge rather than through
pumping, modification of slurry tank drive supports arrangement and usage of waste Carbide
Plant bag house dust in recipe.
Implementing thermal energy saving schemes like increasing sludge consumption in
Sulphur melting using waste heat of SO2 gas.
Raw juice heating by using hot condensate.
Installation of steam saving device named as "LTEM" to tap waste heat
from Pan and planetary drive at C TVC shell.
Replacing auto recirculation valve and bypass assembly of boiler feed water pump
A & C.
Reducing energy consumption by providing VFD in Dechlorination pump - A and seal
air fan frequency.
Energy saving by replacing existing aluminium flexible with fusion welded copper
flexible for E-Electrolyser.
Modification in balancing of PA fan discharge flow.
Applying anti friction coating in process plant cooling tower pump-C.
(b) Additional investments and proposals being
implemented for reduction in consumption of energy:
Installation of Advance Process Control System for Ammonia Plant and DCS for
Revamp of Benfield Co2 Removal System.
Installation of a top-up turbine and replacement of 4 K heater tube bundle in
Zero gape conversion of Electrolyser # B.
Replacement of Anode and Membrane of Electrolyser # B.
Modification in Limestone Crushing System reducing number of crushers for size
reduction and easy processing of Crushed limestone during monsoon.
New Condenser Bank for improving power factor of 3.3 KV system and to provide
Condenser Bank in 8 transformer of 3.3 KV supply system.
Investment for modifications in C-Continuous Pan and in Sulphur Melting System.
Trimming of FD fan impeller.
Coating in power plant cooling water pump; providing VFD in Filtered brine pump
- A, Dying tower, clarified brine pump and Effluent transfer pump; and reducing voltage in
(c) Impact of the measures at (a) & (b) above for reduction of energy consumption
and consequent impact on the cost of production of goods:
The above mentioned energy consumption measures which have already been undertaken and
the measures under implementation will yield savings in energy consumption compared to the
past years and will continue to reduce the cost of production. The summarized position of
energy reduction achieved is as under:
Reduction in carbon consumption by 31 Kg/MT and power consumption by 19 Kwh/MT
carbide, resulting in saving of Rs.5 crore/year.
Reduction of Auxiliary Power consumption by 200 Kwh/day, resulting in saving of
Rs.3 Lacs per year.
Energy saving arising out of reduction in carbon consumption & power
Reduction in power consumption.
Saving of Rs.42 lacs/year in Chemicals, Rs.3 lacs/ year in PVC and of Rs.37.4
lacs in cement.
(d) Total energy consumption and energy consumption per unit of production:
Form A is annexed.
B. TECHNOLOGY ABSORPTION
(a) Efforts made in technology absorption
Form B is annexed.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
(a) Activities relating to exports; initiatives taken to increase exports; development
of new export markets for products and services; and export plans:
(b) Total foreign exchange used and earned:
|- Total foreign exchange used
|- Total foreign exchange earned
(See Rule 2)
Form for disclosure of particulars with respect to conservation of energy
|A. POWER AND FUEL CONSUMPTION
| Kwh (in lacs)
| Total Cost (Rs./lacs)
| Rate (Rs./Kwh)
|(b) Own Generation
|(i) Through Diesel Generator
| Kwh (in lacs)
| Kwh generated per ltr. of Diesel/Furnace Oil
| Cost (Rs./Kwh)
|(ii) Through Steam Turbine Generator
| Kwh (in lacs)
| Kwh (in lacs) generated per Kg. of Coal
| Cost (Rs./Kwh)
|(iii)Through Steam Turbine Generator (Bagasse)
| Kwh (in lacs)
| Units generated per M.T. of Bagasse
| Bagasse Consumed (in MT/Lacs)
|Total Cost (Rs./lacs)
|Average Rate (M.T.)
|3. Furnace Oil
|Total Cost (Rs./lacs)
|Average Cost (M.T.)
|B. CONSUMPTION PER UNIT OF PRODUCTION
| Urea (Kwh/M.T.)
| PVC Resin/Compounds (Kwh/M.T.)
| Carbide Packed (T/Ton)
| C. Soda, SFC, Kota (Kwh/M.T.)
| C. Soda, SAC, Bharuch (Kwh/M.T.) - Internal Generation
| Liquid Chlorine (Kwh/M.T.)
| HCL (Kwh/M.T.)
| Textiles - Yarn (Kwh/Kg.)
| Sugar - Ajbapur (Kwh)
| Sugar - Rupapur (Kwh)
| Sugar - Loni (Kwh)
| Sugar - Hariawan (Kwh)
| Profile - Fenesta Building Systems (Kwh/M.T.)
| Urea (M.T./M.T.)
| PVC Resin (M.T./M.T.)
| Carbide Packed (T/Ton)
| C. Soda (M.T./M.T.)
| Cement (M.T./M.T.)
| SBP (M.T./M.T.)
|3. Furnace Oil
| Urea (Kg./Ton)
| C. Soda, SFC, Kota (Kg./Ton)
| C. Soda, SAC, Bharuch (Kg./Ton)
| Cement (Kg./Ton)
| LDO/HSD - Urea (Ltr./Ton)
| Steam - C. Soda (M.T./M.T.) - SAC, Bharuch
| Steam - PVC Compound (M.T./M.T.)
| Bagasse (M.T.) - Ajbapur
| Bagasse (M.T.) - Rupapur
| Bagasse (M.T.) - Loni
| Bagasse (M.T.) - Hariawan
1. Different sources of energy are inter changeable.
2. Wherever required, figures relating to previous year have been re-arranged.
(See Rule 2)
Form for disclosure of particulars with respect to technology absorption
Research and Development (R & D)
1. Specific areas in which R & D carried out by the Company
Loss of Gas yield of Calcium Carbide during cooling and handling is a concern
area. New palette system is designed for cooling of carbide in cooling hall.
Simplification/modification of carbide handling/ conveying system.
Filtration and ion Exchange trials for clear juice.
Metallic conveyor drier belt for sugar drying and conveying.
Sugar cane breeding and Bio control lab.
Automotive parking brakes, gear knot, rigid profile, handle and straps.
UV light color fastness master batch.
2. Benefits derived as a result of the above R & D
Reduction in dust losses. Estimated savings are Rs.100 lacs during the year.
Optimisation of water quantity application in milling.
Reduction in sulphur consumption.
Improvement in sugar quality.
New product development.
3. Future plan of action
Several energy saving schemes have been identified for reduction in energy
consumption. However, these will be implemented depending on viability under the present
Implementation of Palette system in new cooling hall is planned in current
financial year. This will result in estimated saving of Rs.1 crore.
Optimum application of water and improving boiler operations.
Use of ion exchange resin for syrup filteration.
Rigid injection molding and extrusion grades development.
Low smoke and low HCL compound.
4. Expenditure on R & D
|d) Total R & D expenditure as percentage of total turnover
Technology absorption, adaptation and innovation
1. Efforts, in brief, made towards technology absorption, adaptation and innovation
Use of waste heat of sulphur burner during Pan boiling.
To get high gloss in rigid grades, improvement in impact and transparency.
2. Benefits derived as a result of the above efforts, e.g. product improvement, cost
reduction, product development, import substitution, etc.
Conservation of Steam
Reduction in power consumption
New product development
3. Details of imported technology (imported during the last 5 years reckoned from the
beginning of the financial year) are furnished as under: Sugar Plant
|a) Technology Imported
||Multi Bed Filtration System and De- sweetening System.
|b) Year of Import
|c) Has the technology been fully absorbed?
|d) If not fully absorbed, reasons therefor and future plans of action