Simbhaoli Sugars Ltd

Dear Members,

The Board of Directors is delighted to present the 13th Annual Report on the business and operations of Simbhaoli Sugars Limited ("the Company") along with the summary of standalone and consolidated financial statements for the year ended March 31,2024.

In compliance with the applicable provisions of the Companies Act, 2013, ("the Act"), the Securities and Exchange Board of India ("SEBI") (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), this Board's Report is prepared based on the standalone financial statements of the Company for the year under review and also present the key highlights of performance of subsidiaries and joint ventures companies and their contribution to the overall performance of the Company during the year under review.

OVERVIEW OF FINANCIAL PERFORMANCE

Key highlights of consolidated and standalone financial performance for the year ended March 31,2024, are summarised as under:

(Rs.in Lakhs except EPS figure)

*In the consolidated financial results of the Company for the year ended 31st March 2023 and Year ended 31st March, 2024, the financial results of SPPL, a material subsidiary has not been consolidated, as the financial results of SPPL have not been yet finalized and approved till date.

STATE OF COMPANY'S AFFAIRS

Consolidated revenue from operations for the year at Rs. 1,33,107.22 Lakhs declined by 4.87%. Losses before exceptional items and taxes at Rs. (1201.18) Lakh declined by 60.84%.

Your Company recorded a Consolidated turnover of Rs. 1,35,098.37 Lakhs in the current year against Rs. 1,41,743.15 Lakh in the previous year. The Company registered a consolidated Loss before tax and exceptional income (including Other Comprehensive Income) of Rs. (1,201.18) Lakh for the year ended March 31,2024, against a Loss before tax (including the Comprehensive Income) of Rs. (3,067.46) Lakh in the previous year.

Further, Your Company recorded a Standalone turnover of Rs. 1,34,262.64 Lakhs in the current year against Rs. 1,39,592.11 Lakh in the previous year. The Company registered a Loss before tax and exceptional income (including Other Comprehensive Income) of Rs. (1,207.28) Lakh for the year ended March 31,2024, against a Loss before tax (including the Comprehensive Income) of Rs. (3138.36) Lakh in the previous year.

DIVIDEND

During the year under review, the Company has reported a net loss of Rs. (1,263.03) Lakh. Hence, the Board of Directors of the Company have not recommended Dividend for Financial Year ended on March 31,2024.

Unclaimed Dividend

Since the Company has not declared any dividend in past, no amount of unclaimed dividends and shares thereof are liable to be transferred to Investors Education and Protection Fund.

BOOK CLOSURE & RECORD DATE

The Register of Members and Share Transfer Books of the Company will remain closed from September 22, 2024 to September 28, 2024 (both days inclusive).

TRANSFER TO RESERVES

The Company has not transferred any amount to the General Reserve for the financial year ended March 31,2024.

CHANGE IN SHARE CAPITAL

The paid-up share capital of the Company as on March 31,2024, was Rs. 4,127.90 Lakh and there has been no change in the capital structure of the Company

CHANGES IN THE NATURE OF BUSINESS

There has been no fundamental change in the nature of business of the Company during the financial year ended March 31,2024.

Corporate Insolvency Resolution Process

Simbhaoli Sugars Limited is under Corporate Insolvency Resolution Process (CIRP) of the Insolvency and Bankruptcy Code 2016 (IBC) in terms of Order passed by the Hon'ble National Company Law Tribunal (NCLT), Allahabad Bench with effect from July 11,2024. Mr. Anurag Goel an insolvency professional having IBBI registration no. IBBI/IPA-001/IP-P00876/2017-2018/11460 was appointed as Interim Resolution Professional by NCLT vide its Order dated July 11,2024.

One of the Promoters of the Company, Ms. Gursimran Kaur Mann, have filed an appeal before the Hon'ble National Company Law Appellate Tribunal, New Delhi ("NCLAT") against the NCLT order. The NCLAT vide its interim order dated July 24, 2024 has given directions that no further steps shall be taken in pursuant of the impugned order passed by NCLT and allowed IRP of the Company to continue to manage the operations of the Company. The matter is sub-judice

Credit Rating

The credit facilities availed by the Company have been classified as non-performing assets (NPA) by all the lenders and interest thereon is not being charged to the loan accounts by commercial lenders as per RBI's circular. Accordingly, Company's credit rating has continued to remain below investment grade.

SUBSIDIARY, JOINT VENTURE, AND ASSOCIATE COMPANIES

The Company has three subsidiary companies, viz. Simbhaoli Power Private Limited (SPPL), Integrated Casetech Consultants Private Limited (ICCPL), Simbhaoli Speciality Sugars Private Limited (SSSPL).

The consolidated financial statements presented by the Company include financial information of its subsidiary companies prepared in compliance with applicable accounting standards, except as mentioned otherwise in the accompanying notes.

A Statement containing salient features of Financial Statements of Subsidiaries/ JV/ Associates Companies and their contribution to the overall performance of the company in Form AOC-1 is annexed as Annexure- A.

1. Simbhaoli Power Private Limited

Simbhaoli Power Private Limited (SPPL) is a 51% subsidiary, with a joint venture (JV) with Sindicatum Baggase India Private Limited, (SBIPL), Singapore. The capacities enhancement in SPPL is complete up to 100 mW as per the agreed understanding between the Joint Venture Partners. The financial results for the year ended on March 31,2024, have not yet been finalized and approved to date by SPPL, hence not available for consolidation. The financial results for the year ended on March 31,2023 is provided below:

(Rs.in Lakhs)

2. Integrated Casetech Consultants Private Limited

Integrated Casetech Consultants Private Limited (ICCPL), is an 85% subsidiary company and the technology vertical of SSL. It has been providing operations and maintenance services to various sugar companies in India and abroad. The financial results for the year ended on March 31,2024, is as follows:

(Rs.in Lakhs)

3. Simbhaoli Speciality Sugars Private Limited

No major activities have been carried out in this Company during the year. Simbhaoli Speciality Sugars Private Limited (SSSPL) is a wholly- owned subsidiary of Simbhaoli Sugars Limited. The brief of the financial results for the quarter ended on March 31,2024, is as follows:

(Rs.in Lakhs)

BOARD OF DIRECTORS

Mr. Har Prasad Kain (DIN: 008277248) was appointed as an Independent Director of the Company by the Members on September 25, 2019. The Board of Directors of the Company, in its meeting held on November 7, 2023, subject to approval of the members, has re-appointed Mr. Kain as Independent Director of the Company for a period of five years w.e.f. from November 14, 2023 upto November 13, 2028. Further his reappointment has been approved by the members of the Company by passing resolution through Postal ballot on February 01,2024.

Mr. Aseem Sehgal (DIN: 08202621), has resigned as Independent Director from the Company w.e.f. January 01, 2024 citing his personal commitments. Further, Mr. Aseem Sehgal has confirmed that there is no other reason apart from the mentioned above for his resignation.

The Board of Directors of the Company, in its meeting held on April 15, 2024, subject to approval of the members, has appointed Mr. Raghav Sharma (DIN: 10591405) as Independent Director of the Company for a term of Five Years with effect from April 15, 2024 till April 14, 2029 (both day inclusive).

Further his appointment has been approved by the members of the Company by passing resolution through Postal ballot on July 09, 2024.

Further, in terms of Applicable provisions of the Act and the Articles of Association of the Company, Mr. Gurpal Singh (DIN:00064807), Director of the Company retires at the ensuing AGM and being eligible, seeks re-appointment.

In accordance with Section 17, of the IBC, 2016, the Powers of the Board of Directors has been suspended and such powers stand vested with Mr. Anurag Goel, IRP, with respect to the Company with effect from July 11,2024.

Key Managerial Personnel

In terms of Section 203 of the Act, the Key Managerial Personnel of the Company are:

1. Ms. Gursimran Kaur Mann* - Managing Director

2. Mr. Sachchida Nand Misra* - Whole Time Director designated as Chief Operating Officer

3. Mr. Dayal Chand Popli - Chief Financial Officer

4. Mr. Shubham Kandhway- Company Secretary

*the Powers of the Board of Directors has been suspended and such powers stand vested with Mr. Anurag Goel, IRP, with respect to the Company with effect from July 11, 2024.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Act, the Board of Directors to the best of their knowledge and ability confirms that:

i. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;

ii. The Directors had 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 of the company for that period;

iii. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. The Directors had prepared the annual accounts on a going concern basis; and

v. The Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

vi. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received the necessary declaration from each Independent Director in accordance with Section 149(7) of the Act and Regulations 16(1)(b) and 25(8) of the SEBI Listing Regulations, that he/she meets the criteria of independence as laid out in Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations.

In the opinion of the Board, there has been no change in the circumstances which may affect their status as independent directors of the Company and the Board is satisfied of the integrity, expertise, and experience (including proficiency in terms of Section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board.

EVALUATION OF BOARD'S PERFORMANCE

The board evaluation is an essential part of the Company's commitment to good corporate governance. By conducting an annual evaluation of its Board, Committees, and individual members, the Company demonstrates its commitment to transparency, accountability, and effective governance. It enables the Board to identify areas where it can improve its performance and ensures that the Company's governance practices remain in line with best practices. Details pertaining to the Process of Evaluation of Board, Committees and the Directors has been detailed in the Corporate Governance Report which forms part of the Boards' Report.

FAMILIARISATION PROGRAMME FOR DIRECTORS

The Company has an orientation process/familiarization program for its directors (including Independent Directors), which includes sessions on various business and functional matters, and strategy sessions. The Company ensures induction and training programs are conducted for newly appointed Directors. New Independent Directors are taken through a detailed induction and familiarization program, including briefing on their role, responsibilities, duties, and obligations, the nature of the business and business model, matters relating to Corporate Governance, Code of Business Conduct and Ethics, Risk Management, Compliance Programs, Internal Audit, etc.

PECUNIARY RELATIONSHIP OR TRANSACTIONS WITH THE COMPANY

During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees (only to Independent Directors), and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/ Committee(s) of the Company.

COMPANY'S POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION

The Company's policy relating to appointment of directors, payment of managerial remuneration, directors' qualifications, positive attributes, independence of directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 has been disseminated at the Company's website at https://www.simbhaolisugars.com/company-policies.php.

MEETINGS OF THE BOARD AND COMMITTEES OF THE BOARD

The Board met five times during the year under review. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 (the 'Act') and the SEBI Listing Regulations. The Committees of the Board usually meet the day before or on the day of the Board meeting, or whenever the need arises for transacting business. Details of composition of the Board and its Committees as well as details of Board and Committee meetings held during the year under review are given in the Corporate Governance Report.

AUDIT COMMITTEE

The composition and terms of reference of the Audit Committee has been furnished under Clause 6 in the Corporate Governance Report forming a part of this Report. There had been no instances where the Board has not accepted the recommendations of the Audit Committee.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The Company has a well-defined process of identification of related parties and transactions with related parties, its approval and review process. The Policy on Related Party Transactions as formulated by the Audit Committee and the Board is hosted on the Company's website at https://www.simbhaolisugars.com/company-policies.php. As required under Regulation 23 of the Listing Regulations, the Audit Committee has defined the material modification and has been included in the said Policy.

All contracts, arrangements and transactions entered by the Company with related parties during FY 2023-24 (including any material modification thereof), were in the ordinary course of business and on an arm's length basis and were carried out with prior approval of the Audit Committee. All related party transactions that were approved by the Audit Committee were periodically reported to the Audit Committee. Prior approval of the Audit Committee was obtained periodically for the transactions which were planned and/or repetitive in nature and omnibus approvals were also taken as per the policy laid down for unforeseen transactions.

None of the contracts, arrangements and transactions with related parties, required approval of the Board/Shareholders under Section 188(1) of the Act and Regulation 23(4) of the Listing Regulations.

Further, during the year there were no material related party contracts entered into by the Company and all contracts were at arm's length and in ordinary course of business.

The particulars of contracts or arrangements made with related parties made pursuant to Section 188 of the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015 and Indian Accounting Standards 24 issued by the Institute of Chartered Accountants of India are furnished in Note 10 in the Notes to accounts forming part of the Standalone financial statements.

VIGIL AND WHISTLE BLOWER MECHANISM

The Company has established a vigil mechanism, which overseas through the Audit Committee, the genuine concerns expressed by the employees and other directors. The Company has also provided direct access to the Chairman of the Audit Committee on reporting issues concerning the interests of co-employees and the Company in order to provide adequate safeguards against victimization of all persons.

The policy on the vigil mechanism comprising of the whistle blower policy, has been disseminated at the Company's website at link- https://www.simbhaolisugars.com/company-policies.php. During the year, no such complaint has been received by the Company.

INTERNAL CONTROL SYSTEMS

The Company has an adequate system of internal control procedures which is commensurate with the size and nature of its business. Detailed procedural manuals are in place to ensure that all the assets are protected against loss and all transactions are authorized, recorded and reported correctly. The internal control systems of the Company are monitored and evaluated by internal auditors and their audit reports are reviewed by the Audit Committee of the Board of Directors. The observations and comments of the Audit Committee are placed before the Board.

RISKS & MITIGATION STEPS

The Company has an elaborate Enterprise Risk Management Policy and Risk Charter defining the risk management governance model, risk assessment, and prioritization process. Risk Management Framework of the Company integrates leading risk management standards and practices. In developing the Risk Management Framework, the focus has been to design a process that addresses the Company's business needs while remaining simple and pragmatic. Risk Management Framework of the Company outlines the series of activities that the Company would use in identifying, assessing, and managing its risks.

The Risk Management Framework of the Company consists of two key components

• Risk management process: the steps and activities that Company would employ to identify, prioritize, and manage risks; and

• Risk management structure: the enablers that facilitate the implementation of the process.

The Audit Committee reviews and monitors the key risks and their mitigation measures periodically and provides an update to the Board on the Company's risks outlined in the risk registers. The Audit Committee has additional oversight in the area of financial risks and controls.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis as required in terms of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations) is annexed to the report as Annexure- B.

CORPORATE GOVERNANCE

Your Company attaches considerable significance to good Corporate Governance as an important step towards building investor confidence, improving investors' protection and maximizing long-term shareholders' value.

Pursuant to the SEBI Listing Regulations, the Corporate Governance Report is annexed to this report as Annexure- C. Further, the certificate of the Practicing Company Secretary, M/s Amit Gupta & Associates, Company Secretaries, Practicing Company Secretary, confirming compliance of conditions of Corporate Governance as stipulated under Schedule v(e) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed to the Corporate Governance report.

HUMAN RESOURCES

The Company believes that the Competence and Commitment of our employees are the key differentiating factors which enable our organization to create value by offering quality products & services to our customers. We strive to create a harmonious work environment & strengthen our work culture to drive high level of performance orientation. As a part of the culture, we are committed towards scaling up competence level of employees & offering them a long term career to attract & retain talent. As on March 31,2023, the Company had 1450 employees (previous year 1485) on its direct pay roll.

Information in accordance with the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, forms part of this Report as Annexure- D. As per the provisions of Section 136(1) of the Companies Act, 2013, the Annual Report excluding the information on employee's particulars under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is being sent to the members which is, however, available for inspection in electronic mode. Members can inspect the same by writing to shubham.kandhway@simbhaolisugars.com. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished without any fee.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder, your Company has in place a Policy for Prevention of Sexual Harassment of Women at Work Place and constituted an Internal Complaints Committees (ICC). No complaint has been received during the year ended March 31,2024.

STATUTORYAUDITORS AND AUDITOR'S REPORT

As per the provisions of the Act, the Company appointed M/s Mittal Gupta & Co, Chartered Accountants as the Statutory Auditors of the Company for a period of five years commencing from the conclusion of the 10th Annual General Meeting held on December 21,2020 till the conclusion of 14th Annual General Meeting.

Explanation or comments on qualifications, reservations or adverse remarks or disclaimers made by the Statutory Auditors in their reports

Explanation or comments on qualifications, reservations or adverse remarks or disclaimers made by the Statutory Auditors in their reports are selfexplanatory and explained in details in notes to the accounts and at other appropriate sections in the Annual Report. The qualifications along with management comments are annexed as Annexure- E. The detailed statement of Impact of Audit Qualifications was submitted to the stock exchange along with the Financial Results for the year ended March 31,2024 and available at the website of the Company

SECRETARIAL AUDITOR AND AUDITOR'S REPORT

The provisions of Section 204 of the Companies Act, 2013 mandates Secretarial Audit of the Company by a Company Secretary in Practice. The Board appointed M/s Amit Gupta & Associates, Company Secretaries, Practicing Company Secretary as the Secretarial Auditor for the financial year ending March 31,2024. The Secretarial Auditors' Report for the financial year ended March 31,2024 is annexed to this Report as Annexure- F. There is no qualification, reservation, adverse remark or disclaimer in the said report and do not call for any further comments.

Secretarial Audit report of Simbhaoli Power Private Limited, a material subsidiary, has also been attached as Annexure- G.

COST RECORDS AND COST AUDITORS

During the year under review, in accordance with Section 148(1) of the Act, the Company has maintained the accounts and cost records, as specified by the Central Government. Such cost accounts and records are subject to audit by M/s Satnam Singh Saggu, Cost Auditors of the Company for FY 2023-24.

The Board has re-appointed M/s Satnam Singh Saggu, Cost Accountants (Firm Registration Number: 102209) as Cost Auditors of the Company for conducting cost audit for the FY 2024-25. A resolution seeking approval of the Shareholders for ratifying the remuneration payable to the Cost Auditors for FY 2024-25 is provided in the Notice of the ensuing Annual General Meeting.

The Cost accounts and records as required to be maintained under section 148 (1) of the Act are duly made and maintained by the Company. DEPOSITS

In terms of the provisions of Section 73 to 76 of the Act read with the relevant rules made thereunder, your Company has not accepted any deposit from the public.

ANNUALRETURN

The Annual Return for financial year 2023-24 as per provisions of the Act and Rules thereto, is available on the Company's website at https://www.simbhaolisugars.com/annual-report.php. In terms of Rules 11 and 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return shall be filed with the Registrar of Companies, with prescribed timelines.

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

As required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the information relating to Conservation of Energy, Technology Absorption and Foreign Exchange earnings & outgo is annexed and forms a part of this Report as Annexure- H.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees or investments made under Section 186 of the Companies Act, 2013 and rules made there under are disclosed in respective heads and on Note 3.04 in the Notes to accounts forming part of the Standalone financial statements.

The Company has the following investments as on March 31,2024:

(Rs.in Lakhs)

SECRETARIAL STANDARDS

The Company has in place proper systems to ensure compliance with the provisions of the applicable secretarial standards issued by The Institute of Company Secretaries of India and such systems are adequate and operating effectively.

TRANSFER TO INVESTOR EDUCATION & PROTECTION FUND

During the financial year ended March 31,2024, no unpaid or unclaimed dividend or shares were liable to be transferred to Investor Education and Protection Fund.

SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Company's operations in future.

ACKNOWLEDGEMENT

Your directors take this opportunity to thank the employees, customers, shareholders, suppliers, bankers, business partners/associates, financial institutions, Securities and Exchange Board of India and Central and State Governments for their consistent support and encouragement to the Company.