Your Board of Directors have pleasure in presenting the 10th Annual Report on the business & operations of the Company along with the Audited Financial Statements for the financial year ended 31st March, 2024.
1. FINANCIAL RESULTS
(Rsin lakhs)
2. OPERATING PERFORMANCE
A detailed analysis of the Company's operations, future expectations and business environment has been given in the Management Discussion & Analysis Report and forms an integral part of this report marked as "Annexure A".
3. FINANCIAL PERFORMANCE 2023-24
During the year, the Company recorded Total Revenue of Rs.2,69,697.70 Lakhs (including other income aggregating to Rs 346.26 Lakhs. The Gross Revenue from Operations for the year 2023-24 stood at Rs 2,69,351.44 Lakhs. The Profit before Finance Costs, Tax, Depreciation and Amortisation during the period under review stood at Rs 33,351.62 lakhs representing 12.37% of the total revenue.
There is no change in the nature of business of the Company during the year under review. There were no significant or material orders passed during the year by regulators, courts or tribunals impacting the Company's operation in future.
There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year and date of this report.
4. DIVIDEND
Your Board of Directors has recommended a dividend Rs / - per equity share of Rs 10/- each (100 %) for the financial year 2023-24 to the Members of your Company. The proposal is subject to the approval of the Members at the 10th Annual General Meeting (AGM) of your Company scheduled to be held on July 31, 2024. The dividend will entail a cash outflow of Rs 2001.84 lakhs (previous year Rs 2001.84 lakhs).
The Dividend Distribution Policy of the Company is available on the website of the Company and can be accessed at the web link: https://www.birla- sugar.com/Assets/Avadh/Avadh%20Sugar%20-%20 Dividen%20Distribution%20Policy.pdf There has been no change in this policy during the year under review
The Company proposes to retain its earnings and does not propose to transfer any amount to General Reserve.
5. PUBLIC DEPOSITS
During the year, the Company has not accepted any deposits from the public under Chapter V of the Companies Act, 2013 ("the Act"). There was no public deposit outstanding as at the beginning and end of the financial year 2023-24.
6. SHARE CAPITAL
During the year under review, the Authorized Share Capital of the Company stood at Rs 170,05,00,000/- (Rupees One hundred seventy crore and five lakhs) divided into 5,60,50,000 (Five crore sixty lacs fifty thousand) Equity Shares of Rs 10/- (Rupees ten) each; 8,00,00,000 (Eight crore) Preference Shares of Rs 10/- and 34,00,000 (Thirty-four lacs) Preference Shares of Rs 100/- each and there is no change in the authorised capital.
The Issued and Subscribed Share Capital of your Company, as on 31st March, 2024, stood at Rs 20,01,84,200/- divided into 2,00,18,420 Equity Shares of Rs 10/- each.
7. SUBSIDIARY, ASSOCIATE AND JOINT VENTURE
The Company does not have any subsidiary company or any associate company or any joint venture with any person. However, the Company has in place a policy for determining material subsidiaries in line with the requirement of "Listing Regulations" as amended from time to time. The said Policy is being disclosed on the Company's website at the weblink http://biria-sugar.com/Assets/Avadh/Avadh-Sugar- Po1icy-for-Determining-Materia1-Subsidiaries.pdf
8. CREDIT RATING
India Ratings and Research - a Credit Rating Agency, has assigned the Company Credit Rating IND A+ Stable with respect to long-term bank facilities whereas short-term bank facilities rating has been assigned rating of IND A1.
9. HUMAN RESOURCES
The Company continues to create a productive, learning and caring environment by implementing robust and comprehensive HR processes, fair and transparent performance evaluation and taking new initiatives to further align its Human Resource policies to meet the growing needs of its business.
10. DIRECTORS
The Board of Directors comprises of seven Nonexclusive Directors having experience in varied fields and a Whole time Director. Out of seven Nonexclusive Directors, five are Independent Directors and two are Promoter Directors. Mrs Nandini Nopany is the Chairperson of the Company and Mr Chandra Shekhar Nopany is Co-Chairperson of the Company. The Board is duly constituted with proper balance on Executive and Non-executive , Independent and Woman Directors.
Aii the Independent Directors have submitted declarations that they meet the criteria of independence as provided under Section 149(6) of the Companies Act, 2013, the rules framed thereunder and the Listing Regulations. In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, the names of all the Independent Directors of the Company have been included in the data bank maintained by the Indian Institute of Corporate Affairs.
The Board of Directors is of the opinion that the Independent Directors are persons of integrity with high ievei of ethical standards, they possess requisite expertise and experience for appointment as Independent Director of the Company.
Mr Chandra Shekhar Nopany, will retire by rotation at the ensuing Annual General Meeting and being eligible has offered himseif for re-appointment as Director of the Company.
Pursuant to Section 161 and other appiicabie provisions of the Act, read with Articles of Association of the Company, the Board of Directors at its meeting held on May 13, 2024, has appointed Mr. Amit Dalal (DIN: 00297603) as an Additional Director, to hold office till the ensuing Annual General Meeting. The same is being placed before the Members of the Company for approval.
Other information on the Directors including required particulars of Director retiring by rotation is provided in the Notice convening the Annual Genera Meeting.
A certificate obtained by the Company from a company secretary in practice, confirming that none of the Directors on the Board of Directors of the Company have been debarred or disqualified from being appointed or continuing as director of companies by the Securities and Exchange Board of India /Ministry of Corporate Affairs or any such statutory authority, is enclosed as Annexure “E" to this Report.
11. KEY MANAGERIAL PERSONNEL
The Key Manageriai Personnel of the Company as on 31st March, 2024 are as under:
Mr. Devinder Kumar Jain ceased to be the Company Secretary and Key Manageriai Personnel
of the Company from close of business hours on August 31, 2023. On the recommendation of the Nomination and Remuneration Committee, the Board of Directors has appointed Ms. Vijaya Agarwala as Company Secretary and Key Managerial Personnel of the Company with effect from November 9, 2023.
a) Mr. Devendra Kumar Sharma, Whole time Director
b) Mr. Dilip Patodia, Chief Financial Officer
c) Ms. Vijaya Agarwala, Company Secretary
All Directors, Key Managerial Personnel and Senior Management of the Company have confirmed compliance with the Code of Conduct of the Company There has been no change in this policy during the year under review. The Code is available on the Company's website at the weblink http:// birla-sugar.com/Assets/Avadh/Avadh-Sugar-Code- of-Conduct.pdf
12. FAMILIARISATION PROGRAMME
Periodic presentations are made at the Board Meetings, business, performance updates & business strategy of the Company. The details of the familiarisation programme (other than through meeting of Board and its Committees) imparted to Independent Director are uploaded on the website of the Company and available at the weblink- http://www.birla-sugar.com/Assets/Avadh/ Familiarisation%20Programme.pdf
13. REMUNERATION POLICY
In pursuance of the provisions of Section 178 of the Act and the Listing Regulations, the Company has formulated a Remuneration Policy which is available at the website of the Company at the weblink http://www.birla-sugar.com/Assets/Avadh/ASEL- Nomination-and-Remuneration-Policy.pdf
14. CORPORATE SOCIAL RESPONSIBILITY POLICY
Your Company believes in long term strategy to contribute to the well-being and development of the society especially the rural population around its plants at Hargaon, Hata, Rosa & Seohara . As part of its CSR initiatives, the Company is working mainly in the areas of imparting School Education, Technical & Vocational Education, Rural Development, Community Healthcare etc. This multi-pronged CSR approach is showing notable improvement in the quality of life of rural population. The Company
continues to support local initiatives to improve infrastructure as well as support in other corporate social responsibilities. The CSR Policy as approved by the Board is available on Company's weblink http://birla-sugar.com/Assets/Avadh/Avadh-Sugar- CSR-Policy.pdf
The composition and terms of reference of Corporate Social Responsibility Committee are given in the Corporate Governance Report. For the purpose of Section 135 of the Companies Act, 2013, the amount equivalent to 2% of the average net profits of the Company made during the immediately preceding three financial years works out to H274.96 lakhs. As against this, the Company had spent H278.96 lakhs on CSR projects / programs during the Financial Year 2023-24.
The Annual Report on CSR activities (including the details of the development and implementation of the Corporate Social Responsibility Policy) as prescribed under Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached as "Annexure I" to this Report.
15. BOARD MEETINGS
A calendar of Meeting is prepared and circulated in advance to the Directors. The Board evaluates all the decisions on a collective consensus basis amongst the Directors. During the financial year ended 31st March 2024, 5 (Five) Meetings of the Board of Directors of the Company were held. The details of the Board Meetings held during the year under review are given in the Corporate Governance Report forming a part of this Annual Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Listing Regulations.
Other information on the Directors and the Board Meetings is provided in the Corporate Governance Report attached as Annexure “B" to this Report.
The Company has complied with the applicable Secretarial Standards prescribed under Section 118(10) of the Companies Act, 2013.
18. INTERNAL COMPLAINTS COMMITTEE
The Company has complied with the provisions relating to the constitution of Internal Complaints Committees under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
19. LOANS, GUARANTEE AND INVESTMENTS
It is the Company's policy not to give any loans, directly or indirectly, to any person (other than to employees under contractual obligations) or to other body corporate or person. In compliance with Section 186 of the Companies Act, 2013, loans to employees bear applicable interest rates. During the year under review, the Company has not made any investment in securities of other body(ies) corporate. The details of Investments, Loans and Guarantees covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.
20. RELATED PARTY CONTRACTS /ARRANGEMENTS
All Related Party Transactions entered during the year were on arm's length basis and in the ordinary course of business. There have been no materially- significant related party transactions made by the Company with the Promoters, the Directors or the Key Managerial Personnel which may be in conflict with the interests of the Company at large. Accordingly, disclosure of contracts or arrangements with Related Parties as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC-2 is not applicable.
The Policy on Related Party Transactions as approved by the Board can be accessed on the Company's website at following web-link https://www.birla- sugar.com/Assets/Avadh/Avadh-Sugar-Related- Party-Transaction-Policy-.pdf
The details of related party transactions are set out in the notes to the financial statements.
21. RISK MANAGEMENT
In line with the regulatory requirements, the Company has formally framed Risk Management Policy to identify and assess the key risk areas, monitor and report the compliance and effectiveness of the same. A Risk Management Committee, is in place comprising of two Independent Directors, Whole time Director, Chief Financial Officer and the Advisor to oversee the risk management process in the Company with an objective to review the major risks which effect the Company from both the external and the internal environment perspective. Appropriate actions have been initiated to either mitigate, partially mitigate, transfer or accept the risk (if need be) and monitor the risks on a regular basis. The details of the terms of reference, number and date of meeting, attendance of director and remuneration paid to them are separately provided in the Corporate Governance Report.
22. INTERNAL FINANCIAL CONTROLS
The Company has laid down internal financial control's, through a combination of Entity level controls, Process level controls and IT General controls inter-alia to ensure orderly and efficient conduct of business, including adherence to the Company's policies and procedures, accuracy and completeness of accounting records and timely preparation and reporting of reliable financial statements/information, safeguarding of assets, prevention and detection of frauds and errors. There is a robust system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. The directors confirm that, for the preparation of financial statements for the financial year ended March 31, 2024, the applicable Accounting Standards have been followed and the internal financial controls are generally found to be adequate and were operating effectively & that no significant deficiencies were noticed.
23. WHISTLE BLOWER / VIGIL MECHANISM
The Company has and adopted whistle blower policy, pursuant to which whistle blowers can report concerns about unethical behaviour, actual or suspected fraud or violation of the Company's code of conduct policy.The mechanism provides adequate safeguards against victimisation of persons who use this mechanism. The brief detail about this mechanism may be accessed on the Company's website at the weblink http://www.birla-sugar.com/ Assets/Avadh/Avadh-Sugar-Whistle-Blower-Policy. pdf
During the year under review, no disclosure concerning any reportable matter in accordance with the Policy, was received by the Company.
24. CORPORATE GOVERNANCE & ANNUAL RETURN
Your Directors strive to maintain highest standards of Corporate Governance. The Corporate Governance Report for the Financial Year 2023-24 is attached as "Annexure B" to this Report. All the Directors of the Company and senior management personnel have confirmed the compliance of Code of Conduct of the Company. The declaration of the Wholetime Director confirming compliance with the 'Code of Conduct' of the Company is enclosed as "Annexure C" to this Report and Auditor's Certificate confirming compliance with the conditions of Corporate Governance is enclosed as "Annexure D" to this Report
A copy of annual return of the Company is available on the website of the Company at the webiink: https://www.biria-sugar.com/Avadh-Sharehoiders- Info/Annual-Returns-Avadh
25. RESEARCH & DEVELOPMENT
During the year under review the Company has undertaken Research & Development initiatives with an intention to improve the sugar recovery ratio and to educate the cane growers to cultivate improved variety of sugarcane and to otherwise increase the sucrose contents in their produce.
26. AUDITORS, AUDIT QUALIFICATIONS AND BOARD'S EXPLANATIONS
STATUTORY AUDITORS
The shareholders of the Company, at their AGM held on July 20, 2022, had appointed Messrs S R Batiiboi & Co LLP, Chartered Accountants, (Firm Registration No. 301003E/E300005), as Auditors of the Company to hold office for a term of 5 (five) consecutive years from the conciusion of the Eighth AGM of the Company held on July 20, 2022 tiii the conclusion of the Thirteenth AGM of the Company.
There has been no qualification, reservation, adverse remark or disclaimer in the Auditor's Reports.
The Notes to the Financiai Statements read with the Auditor's Reports are seif-expianatory and therefore, do not caii for further comments or expianations.
COST AUDITORS
Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its Sugar activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, appointed Mr Somnath Mukherjee, Cost Accountant, as the Cost Auditor to audit the cost accounts of the Company for the financial year 2024-25.
SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Act read with The Companies (Appointment and Remuneration of Manageriai Personnel) Rules, 2014, your Board of Directors had appointed Messrs Vinod Kothari & Co., Practising Company Secretaries to undertake the Secretariai Audit of the Company
for the financial year 2023-24. The Secretariai Audit Report is annexed herewith as "Annexure F" and which is seif-expianatory.
There has been no qualification, reservation, observation, disclaimer or adverse remark in the Secretariai Audit Report.
During the year, the auditors, the secretarial auditors and cost auditors have not reported any fraud under Section 143(12) of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014.
27. INVESTOR EDUCATION AND PROTECTION FUND
During the year under review, the Company was not required to transfer any unciaimed/unpaid dividend and shares to IEPF.
The details of unciaimed/unpaid dividends are available on the website of the Company at https:// www.biria-sugar.com/Avadh-Sharehoiders-Info/ Unciaimed-Dividend-Avadh
28. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO
The requisite information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Ruie, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure G".
29. PARTICULARS OF EMPLOYEES
The human resource is an important asset which has piayed pivotai role in the performance and growth of the Company over the years. Your Company maintains healthy work environment and the empioyees are motivated to contribute their best in the working of the Company. The information required to be disciosed in pursuance of Section 197 of the Companies Act, 2013, read with Rule 5 of the Companies (Appointment and Remuneration of Manageriai Personnel) Rules, 2014, is annexed as "Annexure H" to this Report.
30. DIRECTORS'RESPONSIBILITYSTATEMENT
To the best of their knowledge and belief and according to the information and expianations obtained by them, your Directors make the foiiowing statements in terms of Section 134(3)(c) of the Companies Act, 2013:
a. that in the preparation of the annual financial statements for the year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. that such accounting policies as mentioned in Note 3 of the Notes to the Financial Statements have been selected and applied consistently and judgement and 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 as at March 31, 2024 and of the profit or loss of the Company for the year ended on that date;
c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.
f. that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
31. BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT
In pursuance of the provisions of the Listing Regulations, the Business Responsibility & Sustainability Report for the financial year 2023-24 describing the initiatives taken by the Company from
environmental, social and governance perspective forms part of the Annual Report.
32. CEO/CFO CERTIFICATION
Mr. Devendra Kumar Sharma, the Whole time Director and Mr. Dilip Patodia, Chief Financial Officer have submitted certificates to the Board as contemplated under Regulation 17(8) of the SEBI (LODR) Regulations, 2015.
33. ACKNOWLEDGEMENT
Your Directors take this opportunity of recording their appreciation of the shareholders, financial institutions, bankers, suppliers and cane growers for extending their support to the Company. Your Directors are also grateful to various ministries in the Central Government and State Governments of Uttar Pradesh, the Sugar Directorate and the Sugar Development Fund for their continued support to the Company. The Board of Directors also convey its sincere appreciation of the commitment and dedication of the employees at all levels.
Kolkata
Dated 13th May, 2024