Dhampur Sugar Mills Ltd

To the members

DHAMPUR SUGAR MILLS LIMITED

The Directors have pleasure in presenting the Eighty Ninth Annual Report of the Company together with the Audited Accounts for the financial year ended 31^st March 2024.

Summary and State of Company Affairs

(Rs in Crores)

Operational Performance

The key operational data of the Company is as under:

Sugar operations at a glance

(Lakh tonnes)

(Lakh units)

(Lakh bulk liters)

Chemical operations at a glance

(Lakh Kg)

Potable Spirits

(Lakh cases)

Company's Performance during the Financial Year 2023- 24

The Company's Performance during the Financial Year 2023-24 has been explained in detail in Management Discussion and Analysis Report which forms an integral part of this report.

Dividend and its Distribution Policy

Your Directors' have not recommended any payment of equity dividend for the Financial Year 2023-24.

Dividend Distribution Policy of the Company has been hosted on the website of the Company i.e., https://api. dhampursugar.com/uploads/Dividend_Distribution_ Policy_14022022_0d4417f2c9.pdf

Details of Unpaid and Unclaimed Dividend and Investor Education and Protection Fund (IEPF )

A detailed disclosure with regard to Unpaid and Unclaimed dividend and IEPF activities undertaken by the Company during the year under review forms part of Corporate Governance Report.

Reserves and Surplus

The Company has earned Net Profit after tax of H132.91 Crores for the year ended 31^st March, 2024, which has been added to Retained Earnings. During the year under review, the Company has transferred H0.46 Crores to Molasses Reserve Fund, which is also stated in the notes to Financial Statements.

During the year, the Company has funded the buy-back of Equity Shares (including transaction costs and tax on buyback of shares incurred in relation thereto) from its retained earnings. In accordance with Section 69 of the Companies Act, 2013, the Company has transferred an amount of H1.00 Crores to capital redemption reserve which is equal to the nominal value of the shares bought back from retained earnings.

Reclassification of Promoters

During the financial year under review, pursuant to Order of the Hon'ble National Company Law Tribunal (NCLT), Allahabad Bench dated April 27, 2022 approving the Scheme of Arrangement between Dhampur Sugar Mills Limited and Dhampur Bio Organics Limited and their respective shareholders and creditors (Scheme), the application for Reclassification of Promoters was filed on 9^th June, 2023 with both the Stock Exchanges i.e. BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) and the same is pending for approval.

Subsidiary; Associate & Joint Venture Companies

As on 31^st March 2024, the Company had two subsidiaries i.e. Ehaat Limited and DETS Limited.

Ehaat Limited ('Ehaat') continued its business of trading. During the year, the turnover of the Company stands at H125.18 crores as against previous year of H212.04 Crores.

DETS Limited continued its business of manufacturing, fabricating and consulting services while exploring various other opportunities to expand its operations. The turnover of the Company for the current year stands at H0.60 Crores as against H1.14 Crores turnover in previous year.

Audited Financial Statements for the subsidiaries for Financial Year 2023-24 have been placed on the website of the Company i.e., www.dhampursugar.com and are available for inspection at the Company's registered office and at the registered office of the subsidiary companies.

Consolidated Financial Statements

In compliance with the provisions of the Companies Act, 2013, (the "Act") and requirements of the Indian Accounting Standards Rules on accounting and disclosure requirements, as applicable, and as prescribed under Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, (the "Listing Regulations"), the Audited Consolidated Financial Statements form part of this Annual Report.

Pursuant to Section 129(3) of the Act, a statement in Form AOC-1 is annexed as Annexure 2 containing the salient features of the financial statements of the Company's Subsidiary Companies is also provided in this Annual Report.

The audited financial statements of the Company including the consolidated financial statements and related information of the Company are available on the website of the Company at www.dhampursugar.com

Alteration of Articles of Association

During the year the Articles of Association of the Company were altered by inserting a new clause regarding Buy Back of Equity Shares in the Board Meeting held on 31^st October, 2023 subject to the Shareholder's approval, which was duly obtained through postal ballot dated 13^th December, 2023.

Buy Back of Equity Shares

During the year under review, the Board of Directors of the Company at its meeting held on 3^rd January 2024, approved the buy-back of 10,00,000 Equity Shares of the face value of H10/- each at a price not exceeding H300/- per Equity Share ("Maximum Buyback Price") amounting to H30 crores ("Maximum Buyback size, excluding transaction costs and tax on Buyback"), through the "tender offer" route, using stock exchange mechanism as prescribed under Securities and Exchange Board of India (Buyback Securities) Regulations, 2018 (the "Buyback Regulations") and such other circulars or notifications issued by the Securities and Exchange Board of India and the Companies Act, 2013 and rules made thereunder, as amended from time to time.

The aforesaid buyback was offered to all the eligible shareholders of the Company. The offer period commenced from 23^rd January 2024 and concluded on 30^th January, 2024, and the payment was made on 6^th February, 2024.

Accordingly, as at 31^st March, 2024, the Company completed buy-back of 10,00,000 (31 March 2023: Nil) equity shares of H10/- each [representing 1.51% of total pre buy-back paid up equity share capital of the Company] from the shareholders of the Company at a price of H300 per equity share for an aggregate amount of H30 crores.

Consequent to buy back the Company extinguished 10,00,000 fully paid up equity shares of H10 each (in dematerialized form) on 14^th February, 2024 and the fully paid up equity share capital of the Company (post extinguishment) as at 31^st March, 2024 stood at 6,53,87,590 equity shares of H10/- each aggregating to H653,875,900 (Rupees Sixty Five Crores Thirty Eight Lakhs Seventy Five Thousand and Nine Hundred Only).

Share Capital

The paid-up Equity Share Capital of the Company as at 31^st March, 2024 stood at 6,53,87,590 Equity Shares of H10/- each aggregating to H653,875,900 (Rupees Sixty Five Crores Thirty Eight Lakhs Seventy Five Thousand and Nine Hundred Only).

ESOP/ESAR

During the year under review, the Company has not issued any shares or convertible securities or shares with differential voting rights, nor has granted any stock option, sweat equity or warrants.

Change in the Nature of Business

During the year there was no change in nature of the business of the Company.

Directors and Key Managerial Personnel

During the year under review, Mr. Anant Pande resigned from the position of Chief Executive Officer and Whole Time Director of the Company with effect from 21^st September, 2023 and 25^th September 2023 respectively.

Mr. Subhash Pandey was appointed as Additional Director (designated as Whole Time Director) of the Company with effect from 25^th September, 2023 till 24^th September, 2026. The appointment of Mr. Subhash Pandey as Whole Time Director was approved by the shareholders on 13^th December, 2023 by way of Postal Ballot.

Mr. Gaurav Goel, Managing Director of the Company was re-designated as Vice-Chairman and Managing Director of the Company by the Board of Directors in their meeting held on 31^st October, 2023.

The Directors express their profound grief over the sad demise of Mr. Mahesh Prasad Mehrotra, Non Executive Independent Director of the Company, who passed away on 5^th April, 2024. The Board places on record its heartfelt gratitude for his notable contributions to the Company.

As the constitution of Board of Directors of the Company is compliant with applicable laws and regulations, the Company does not propose to appoint Director in the vacancy caused by the demise of Mr. Mahesh Prasad Mehrotra.

Mr. Ashok Kumar Goel, will retire by rotation at the ensuing Annual General Meeting and, being eligible has offered himself for re-appointment.

Brief profile of Director being re-appointed is given in the Notice convening the ensuing Annual General Meeting of the Company.

Declaration by Independent Directors

The Company has received declaration from all Independent Directors stated below in accordance with the provisions of Section 149(6) of the Companies Act, 2013 and Regulation 16 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and amendments thereto:

Mr. Yashwardhan Poddar Mr. Anuj Khanna Mr. Satpal Kumar Arora Ms. Pallavi Khandelwal

The Company has also received confirmation from all the Independent Directors that they have not been disqualified under Section 164 (1) and 164(2) of the Companies Act, 2013 in any of the Companies, in the previous financial year, and that they are at present free from any disqualification from being a Director. The Independent Directors have also confirmed their compliance with the Code for Independent Directors, as prescribed in Schedule IV to the Companies Act, 2013, and the Code of Conduct and Business Ethics for Board Members and Senior Management of the Company.

Directors Responsibility Statement

In accordance with the provisions of Section 134(5) of the Companies Act, 2013 our Directors state that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any.

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates 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 and Loss ( including other comprehensive income) of the Company for that period.

c) the Directors have taken proper and sufficient care 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) the annual accounts have been prepared on a going concern basis.

e) the Directors have laid down Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Details of Board Meetings held during the Financial Year

The Board of Directors met seven times during the Financial Year 2023-24. Detail of the Board Meetings and attendance at the meetings held during the Financial Year 2023-24 are included in Corporate Governance Report, which forms part of this report.

Committees of the Board

The Board of Directors has following Committees:

Mandatory Committees

- Audit Committee

- Nomination and Remuneration Committee - Stakeholders' Relationship Committee - Corporate Social Responsibility Committee (CSR Committee)

- Risk Management Committee.

The detail of the Committees alongwith their composition, number of meetings and attendance at the meetings are provided in the Corporate Governance Report forming part of this report.

Corporate Social Responsibility

In terms of the provisions of Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 (as amended), the Company has a Corporate Social Responsibility ("CSR") Committee.

The committee was reconstituted w.e.f. 1^st May, 2024 consequent to demise of Mr. Mahesh Prasad Mehrotra. The composition of CSR committee is as under:

- Mr. Ashok Kumar Goel, Chairman

- Mr. Gaurav Goel, Member

- Mr. Yashwardhan Poddar, Member

The details of committee meetings held during the year are provided in the Corporate Governance Report.

The CSR Policy of the Company as approved by the Board can be accessed on the Company's website at the following web- link:https://api.dhampursugar.com/uploads/CSR_Policy_ updated_2022_e7aeb73f1c.pdf In terms of the provisions of Section 135 of Companies Act, 2013 read with amended Companies (Corporate Social Responsibility Policy) Rules, 2014, the Annual Report on CSR activities in the format prescribed is annexed as Annexure 3 to this report.

Non-Mandatory Committee Management Committee :

The Committee carries out management functions of the Company as decided by the Board. The Committee met eight times during the Financial Year. The details of the Committee along with its composition has been provided in the Corporate Governance Report forming part of this report.

Public Deposits

Pursuant to decision of the Board of Directors in the meeting held on 7^th May, 2023 , the Company has discontinued accepting Public Deposits with effect from 8^th May, 2023 .

Status of public deposits including deposits accepted before closure of the scheme and repayment of deposits due during the year is as below:

I. Accepted during the year: H71,42,000/-

II. Paid during the year: H16,63,58,000/-

III. Remained unpaid or unclaimed (excluding interest thereon) as at the end of the year: NIL

IV. If there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved:

Deposits not in compliance with Chapter V of the Act

The Company is in compliance with all the applicable provisions of the Companies Act, 2013.

Particulars of Loans, Guarantees or Investments

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to Financial Statements, wherever applicable.

Related Party Transactions

All the transactions carried out with related parties during the year under review were duly approved by the Audit Committee and are in compliance with the applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time.

There are no material significant related party transactions made by the Company with Promoters, Directors or Key Managerial Personnel etc. which may have potential conflict of interest with the Company.

The Related Party Transactions Policy as approved by the Board has been uploaded on the Company's website i.e. https://dhampursugar.com/investors/policies.

Your directors draw attention of the members to note no. 41 of the Standalone Financial Statements which sets out related party disclosures.

All transactions entered with Related Parties for the year under review were on arm's length basis and in the ordinary course of business and are not material in nature and thus disclosure in Form AOC-2 in terms of Section 134 of Companies Act, 2013 is not required.

Statutory Auditors and their Audit Report:

M/s Mittal Gupta & Co. Chartered Accountants, (ICAI Firm Registration Number: 001874C) and M/s. TR Chadha & Co. LLP, Chartered Accountants, (ICAI Firm Registration number 006711N/N500028) are Joint Statutory Auditors of the Company and shall continue to be Statutory Auditors till the conclusion of Ninety Second Annual General Meeting of the Company.

The reports given by the Auditors on the Standalone and Consolidated Financial Statements of the Company for the year ended 31^st March, 2024, form part of this Annual Report and there is no qualification, reservation, adverse remark or disclaimer given by the Auditors in their reports.

Cost Accounts and Cost Auditors

The Cost Records required under Section 148 of the Companies Act, 2013 and rules made thereunder are maintained in compliance with the provisions. Mr. S. R. Kapur, (Cost Accountant, Meerut), Cost Auditors of the Company have duly submitted the Cost Audit Report for the period under review.

As per the requirement of Central Government and pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, the Board of Directors has on the recommendation of Audit Committee re-appointed Mr. S.R. Kapur, Cost Accountant, Meerut as Cost Auditors to audit the Cost Accounts of the Company for the Financial Year 2024-25. As required under the Companies Act, 2013 and rules made thereunder, the remuneration payable for the Financial Year 2024-25 to Cost Auditors is required to be placed before the members in ensuing Annual General Meeting for its ratification. Accordingly, resolution seeking members approval for the remuneration payable to Mr. S. R. Kapur, is included in the Notice convening Annual General Meeting of the Company.

Internal Auditors

In accordance with the provisions of Section 138 of the Companies Act, 2013, the Company has appointed "Ernst and Young, LLP", Chartered Accountants as Internal Auditors for carrying out the internal audit of the Company for the Financial Year 2024-25.

Internal Financial Control

The Company's Internal Control system with reference to the financial statements is adequate and commensurate with the nature of its business and the size of its operations. Periodic audits and checks are conducted and the controls to prevent, detect and correct irregularities in the operations have been laid down by the Company.

Secretarial Auditors and Secretarial Audit Report

The Company has appointed M/s. GSK & Associates, Company Secretaries to undertake the Secretarial Audit of the Company, in terms of the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder. The Secretarial Audit Report is annexed as Annexure 5 and forms an integral part of this report. There is no qualification in the secretarial audit report for the financial year under review.

Annual Secretarial Compliance Report as required under Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended is also annexed as Annexure 5A and forms part of this report.

Details in respect of fraud reported by Auditors other than those which are reportable to the Central Government

The Auditors of the Company have not reported any fraud in terms of the second proviso to Section 143(12) of the Companies Act, 2013 and therefore no detail is required to be disclosed under Section 134 (3) (ca) of the Companies Act, 2013.

Credit Rating

The details of Credit Rating assigned to the Company during the year are given in the Corporate Governance Report.

Material Changes and Commitments affecting Financial Position of the Company

There were no material changes and commitments affecting financial position of the Company during the year.

Sustainable Growth

Your Company continues to operate in the area of renewable energy in the form of biomass based cogeneration of power and enhanced production of ethanol for ethanol blending programme.

The Company is committed to sustainable development of the areas where it operates and growth of local communities. Towards its journey of sustainable growth, the Company is focused on environment protection. Its initiatives towards Zero Liquid Discharge (ZLD) by installing various equipment have resulted in substantial reduction/elimination of air/water pollution near its plants.

The Company is an equal opportunity employer. The Company gives equal opportunity of employment to women and persons from socially backward classes, subject to availability of required skills.

By way of its CSR initiatives, the Company derives plan for farmer awareness to reduce water consumption for sugarcane irrigation through modern agricultural techniques. The Company has also joined hands with renowned organisations for rain water harvesting/water rejuvenation and health care programmes in rural areas. The Company continues to remain committed towards rural education.

Management Discussion and Analysis

The Management Discussion and Analysis Report on the operations of the Company, as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided in a separate section and forms an integral part of this report.

Corporate Governance

As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended a separate section on Corporate Governance practices followed by the Company, together with a certificate from M/s. GSK & Associates, a firm of Company Secretaries in Practice, confirming compliance forms an integral part of this report.

Compliance with Secretarial Standards

The Company has complied with all the applicable mandatory Secretarial Standards issued by The Institute of Company Secretaries of India.

Policy on Selection and Remuneration of Directors

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. Details of this policy are set out in the Corporate Governance Report which forms a part of this Report. The remuneration policy is in consonance with the existing policy of the Company.

The Nomination and Remuneration Policy as approved by the Board is placed on the Company's website i.e., https:// dhampursugar.com/investors/policies

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and applicable Regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out the evaluation of its own performance and that of the Board Committees and of Directors individually on the basis of structured questionnaire that was prepared after considering inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations, corporate governance practices and stakeholders' interests, etc.

A separate exercise was carried out to evaluate the performance of Individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, meeting risk management and competition challenges, compliance and due diligence, financial control, safeguarding the interest of the Company and its minority shareholders etc. The Nomination and Remuneration Committee also carried out an evaluation of every Director's performance. The Directors expressed satisfaction with the evaluation process and results thereof.

Risk Management Policy and Framework

The Risk Management Policy of the Company is in place for risk assessment and mitigation. The policy facilitates the identification of risks at an appropriate time and ensures necessary steps to be taken to mitigate the risks. Risk procedures are periodically reviewed to ensure control of risk through a properly defined framework. The Company's Risk Management strategy is integrated with its overall business strategies and is communicated throughout the organization. The Risk Management Policy as approved by the Board is uploaded on the Company's website at www.dhampursugar. com.

Vigil Mechanism/Whistle Blower Policy

The Company has formulated Vigil Mechanism /Whistle Blower Policy for Directors and Employees in order to keep high standards of ethical behavior and provide safeguards to whistle blower.

The Vigil Mechanism/Whistle Blower Policy as approved by the Board is uploaded on the Company's website at https:// api.dhampursugar.com/uploads/Whistle_Blower_Policy_ b011ab56a7.pdf.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed during the year 2023-24.

Conservation of energy, technology absorption, foreign exchange earnings and outgo

Details of conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134 (3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 is annexed as Annexure 4 and forms an integral part of this report.

Annual Return

According to the provisions of Section 92(3) of the Companies Act, 2013, read with Companies (Management and Administration) Rules, 2014, the Annual Return of the Company in Form MGT -7 has been placed on the website of the Company i.e., www.dhampursugar.com.

Significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company's operations in future

There was no such order passed by the Regulators or Courts or Tribunals impacting the going concern status and Company's operations in future.

Difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the banks or financial institutions

The requirement to disclose the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof is not applicable.

Details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016

There was no such application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year.

One Time Settlement with the Banks or Financial Institutions

No one time settlement with Banks or Financial Institutions were entered during the year.

Business Responsibility and Sustainability Report

The Business Responsibility and Sustainability Report for Financial Year 2023-24 is annexed as Annexure 6 as required under Regulation 34 of the Listing Regulations .

Human Resources and Industrial Relations

The Company takes pride in the commitment, competence and dedication of its employees in all areas of the business. The Company has structured induction process at all locations and management development programs to update skills of managers. Industrial relations remained cordial and harmonious during the year.

Particulars of Employees

The Disclosure required under Section 197(12) of the Companies Act, 2013 read with the Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure 1 and forms an integral part of this Report. A statement furnishing the names of Top Ten employees in terms of remuneration drawn and persons employed throughout the year, who were in receipt of remuneration in terms of Rule 5(2) of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014 and their shareholding, relation with any Director, wherever applicable, is annexed as Annexure 1A and forms an integral part of this Report. In line with the provisions of Section 136 of the Companies Act, 2013, the above annexure is not being sent along with this Annual Report to the Members of the Company. Members who are interested in obtaining these particulars may write to the Company Secretary at the registered office of the Company, twenty-one days before and up to the date of the ensuing Annual General Meeting during the business hours.

Suspense Escrow Demat Account

Escrow Demat Account had been opened by the Company with a Depository Participant for crediting unclaimed shares in dematerialised form lying for more than 120 days from the date of issue of Letter of Confirmation(s) to the shareholders in lieu of physical share certificates to enable them to make a request to DP for dematerialising their shares.

Acknowledgement

The Directors express their heartfelt gratitude to the members the Central Government, the State Government of Uttar Pradesh, Banks and Financial Institutions, cane growers, vendors, customers , and other stakeholders for their continued support to the Company and their confidence in its Management.

The Directors would also like to convey their appreciation to the employees at all levels for their significant contribution towards the Company's performance.