To

The Shareholders of the Company,

The Directors take pleasure in presenting this Twenty First Annual Report together with the Audited Accounts for the year ended 31^st March, 2016.

FINANCIAL RESULTS

The financial results of the Company for the period/year ended on 31^st March, 2016 are as under:-

PERFORMANCE OF THE COMPANY

During the year under review, your Company’s Revenue from Operations was Rs. 81,024.95 Lacs as compared to Rs. 75,961.24 Lacs in the previous financial year. Company’s Profit after tax (PAT) was Rs. 1,546.57 Lacs as compared to Rs. (8,819.49) Lacs in the previous financial year.

REVIEW OF OPERATIONS

The Financial Results for the year 2015-16 are for a period of 9 months and are not comparable with the results of 2014-15 which were for a period of 12 months.

Sugar Division

Operational data of the Company for the financial year 2015-2016 and 2014-2015 are as under:

Following are the season wise data of Cane crushed and Sugar produced:

The Company registered a gross turnover of Sugar of Rs.73,679 lacs for the 9 months ended 31^st March, 2016 against Rs. 65,090 lacs for the 12 months ended 30^th June, 2015 (Gross turnover of Sugar of Rs 49,351 lacs for the 9 months ended 31^st March, 2015) - an increase of gross turnover of 49.30 % on Pro rata Basis. The sales realization at Rs.2,882 per qtls was higher as compared to Rs.2,854 per qtls for the previous year 12 months ended 30^th June, 2015.

During the current season, company commenced its crushing season in last week of November 2015. The results were better as compared to previous season in terms of recovery mainly due to optimum mix of better cane varieties. However, the crushing was lower as compared to last season mainly due to reduced area of sugar cane crop as compared to last season.

Sugar: The Company’s aggregate sugar cane crushing was lower at 201.12 lakhs qtls during the season 2015-16 as against 234.33 lakhs qtls in 2014-15 season due to lower cane availability. The Company had a higher recovery of 10.76% as against 9.73% in previous season. The increased recovery was mainly due to optimum mix of better cane varieties and varietal replacement. The Company continued to focus on cane development activities, comprising of varietal replacement with proven high sugared varieties, change in pattern of sowing, ratoon management, encouraging use of Bio - fertilizers and Bio-pesticides etc. and modern agricultural practices due to which the recovery and crushing is expected to improve in the coming season. The Uttar Pradesh and Uttarakhand Government have announced State Advised Price (SAP) for sugarcane at Rs.280 per quintal for season 2015-16. The State Governments retained the same State Advised Price (SAP) for the current sugar season 2015-16 also. Some subsidies/ reliefs have also been announced by both the governments, details of which are given below :-

i. The cane price of Rs.280 per quintal would be paid to farmers in two installments. In case of Uttar Pradesh the first installment of Rs.230 per quintal (Rs.240 per quintal in Uttarakhand) would be paid as per normal practice and the remaining Rs.50 per quintal (Rs.40 per quintal in Uttarakhand) would be paid within three months after the end of the crushing season.

ii. State Govt. of U.P. / Uttarakhand had announced financial assistance of Rs. 23.30/- per quintal of cane for the sugar season 2015-16 linked to average selling price of sugar and it’s by-products and the average overall net revenue which is to be recommended by the Committee constituted by the Government of Uttar Pradesh / Uttarakhand.

In case of Uttarakhand the same has already been approved by the Committee and first installment @ Rs. 13.30/- qtl has already been released by the Government.

iii. U.P. and Uttarakhand Government also granted additional concessions/ reliefs of Rs.11.70 per quintal of cane to the millers for the season 2015-16 covering the following heads:

Rs. (Per Qtls)

Waiver of Entry Tax on sugar - Rs. 2.80

Waiver of cane purchase tax - Rs. 2.00

Waiver/ reimbursement of Society Commission - Rs. 6.90

Total Rs. 11.70

iv. Central government has notified a production subsidy @ Rs 4.50/-qtl on cane based on completion of Export Quota and production of Ethanol of 80% of target. However this subsidy was later on discontinued in the month of June 2016.

Apart from the Cane Development Activities like varietal replacement, change in pattern of sowing, ratoon management etc. company is further strengthening the cane development activities by way of development of in house agri research centre, integrated pest management programme, Soil testing facilities, encouraging use of Bio fertilizers and Bio pesticides and training facilities for the farmers and the cane development staff. These efforts will produce the desired result in the form of improved recovery and higher crush during the coming Sugar season 2016-17.

From the month of March 2016 onwards, the price of Sugar has stabilized as compared to previous season.

Co-generation Division

During the period under review, your company produced 1,460.60 lakhs KWH units of power as compared to 1,842.64 lakhs units of power in the year 2014-2015 (12 M). Out of total production, your company exported 742.82 lakhs KWH units to UPPCL/UPCL for a total amount of Rs. 3,676.96 lakhs against 992.49 lakhs KWH for an amount of Rs. 4,532.27 lakhs in the previous year.

The company has been awarded 32,009 units of REC for all its four units and these REC units are tradeable and an additional source of revenue to your company. During the F.Y.15-16 Company traded 29,805 units of REC for Rs. 447.07 lacs.

Company has installed Bagasse Dryer at Barkatpur unit and successful trial has been completed by the company. With the installation of Bagasse Dryer, Power Export and Bagasse saving will increase and hence, higher revenue is expected.

Distillery Division

Your company has a Distillery with an installed capacity of 75 KLPD at Barkatpur (Distt. Bijnor) in the State of Uttar Pradesh. During the year under review 135.76 lakhs bulk litres (BL) of industrial alcohol produced as compared to 120.42 lakhs bulk litres in the year 2014-15 (12 M) and your company sold 137.59 lakhs bulk litres industrial alcohol (including Ethanol) as compared to 90.87 lakhs bulk litres in the previous year.

During the year CO2 extraction plant was installed at Distillery with the collaboration of third party. CO2 gas produced and sold of 20.79 lakh kg amounting to Rs 52 lakh during the year.

Future Outlook

Sugar industry association has requested the State Government for fixing of cane price based on the revenue sharing of realization from sugar and by-products. For the last few months the price of Sugar has stabilized both at International and Domestic level.

The Central Government is considering to increase the blending % of Ethanol in Petrol from 5% to 10%. This will improve the demand of Ethanol. Excise exemption on Ethanol will further increase the realization of Ethanol.

DIVIDEND

In view of the losses incurred during the previous financial years and carried forward losses, your Directors are unable to recommend any dividend.

The Dividend on Cumulative Redeemable Preference Shares (Series I - 6.5% and Series II - 10%) are being accumulated and will be paid when adequate profits will be generated to wipe off the carried forward losses.

FIXED DEPOSITS

Your Company has neither accepted nor renewed any deposit within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. There were no unclaimed deposits at the end of Financial Year i.e. 31st March, 2016.

DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Kumar Neel Lohit, Nominee Director (DIN: 06504417) of the Company retire by rotation and being eligible, offers himself for reappointment. The Board recommends the re-appointment of Mr. Kumar Neel Lohit as Director in the ensuing AGM of the Company. Brief profile of Mr. Kumar Neel Lohit and his Qualification, Experience along with the name of Companies in which he hold the Directorship and Public Companies in which he hold Chairmanship/membership of the Committees of the Board, as stipulated under Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is given as Annexure to the Notice convening the Annual General Meeting.

During the year under review, Mr. Binod Kumar has been appointed as Nominee Director of Punjab National Bank w.e.f 13^th February, 2016 in place of Mr. Bikash Narayan Mishra.

All the Directors have made necessary disclosures as required under various provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

DIRECTORS’ RESPONSIBILITY STATEMENT

The Board of Directors acknowledges the responsibility for ensuring compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013 and state that:

i. in the preparation of Annual Accounts for the year ended 31^st March, 2016, the applicable accounting standards had been followed with proper explanation relating to material departures;

ii. we have selected appropriate accounting policies and have 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 as at 31^st March, 2016 and of the profits of the Company for the year ended on that date;

iii. we have 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. we have prepared the annual accounts on a ‘going concern’ basis;

v. we have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

AUDITORS

M/s B. K. Kapur & Co., Chartered Accountants, Ghaziabad, Statutory Auditors of the Company will retire at the forthcoming Annual General Meeting and are eligible for re-appointment. M/s B. K. Kapur & Co., was appointed as Statutory Auditors for a tenure of three years, i.e. till the conclusion of 22^nd Annual General Meeting to be held in the year 2017. In view of due compliance of the provisions of Section 139(1), their continuance of appointment is required to be ratified by the members of the Company in the ensuing Annual General Meeting. Therefore, your Directors recommend ratification of appointment of M/s B. K. Kapur & Co., Chartered Accountants as Statutory Auditors in the ensuing Annual General Meeting.

The Company has received consent letters and certificate from the Auditors to the effect that their appointment, if made, shall be in accordance with the conditions as prescribed in the Companies (Audit and Auditors) Rules, 2014, as amended and that they are not disqualified for appointment within the meaning of Section 139 and 141 of the Companies Act, 2013.

Auditors’ Observations

Your Directors wish to clarify the certain observations reported by the Statutory Auditors, as under: -

1. Emphasis of Matter

- In respect of observation under Emphasis of Matter in the Auditors Report your Directors wish to state that the company has continued recognition of Deferred Tax Assets of Rs. 14,104 Lacs on unabsorbed business losses and unabsorbed depreciation. Significant losses in last few years indicate uncertainty as regards realization of such Deferred Tax Assets. The Company’s Management is of the view that due to improved sugar recovery supported by cane development activities, increase in sugar prices and initiatives taken by the government, it has become reasonable that sufficient taxable income will be available against which such deferred tax assets can be realized.

- In respect of observation under Emphasis of Matter in the Auditors Report, regarding preparation of account ongoing concern basis despite substantial erosion of net worth of the company, your Directors wish to state that the company has generated profits during the third quarter and for year ended on 31^st March, 2016.

2. Observation in Para 1 of Annexure to the Report relating to the title deeds of the immovable property not in the name of the Company in few cases, your Directors wish to state that the necessary action is being taken by the Company.

3. Observation in Para 8 of Annexure to the Report relating to delays in the repayment of installment/ interest to the Banks, there has been liquidity problems due to losses incurred by the company during the previous financial years.

4. Observation in Para 11 of Annexure to the Report relating to approval of managerial remuneration amounting to Rs.1.50 lacs to Executive director of the Company, your Directors wish to state that the Company has applied for the approval of Central Government and the same has already been obtained vide Central Government’s approval letter no. SRN C76928472/3/2016-CL.VII dated 24^th May, 2016.

COST AUDITORS

The Board on the recommendation of the Audit Committee has re-appointed M/s M. K. Singhal & Company (Firm Regn. No. 00074), Cost Accountants, to audit the Cost Accounting records relating to Sugar, Cogeneration and Industrial Alcohol for Financial Year 2016-17.

In accordance with the provisions of Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors has to be ratified by the members of the Company. The Board recommends the same for approval of members in the ensuing Annual General Meeting.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, amended up to date and other applicable provisions, if any, the Company has appointed M/s N K Rastogi & Associates (Firm Regn. No. 3785), Practicing Company Secretaries, to do Secretarial Audit of the Company for the Financial Year 2015-16. The Secretarial Audit Report for the financial year ended 31^st March, 2016 is attached and marked as “Annexure-I” and forms part of the Board’s Reports. The observation made by the Secretarial Auditors in their report are self explanatory and therefore do not call for any further explanations/comments. The Secretarial Auditors’ Report does not contain any qualification, reservation or adverse remark.

MEETINGS

The details of Board Meetings and Audit Committee Meetings held during the period under review are given in Corporate Governance Report.

AUDIT COMMITTEE

The Company has constituted Audit Committee as per the provisions of Companies Act, 2013. The details of terms of reference of the Audit Committee, number and dates of meeting held, attendance, among others are given separately in the attached Corporate Governance Report. The Audit Committee satisfies the requirements of Section 177 of the Companies Act, 2013 read with Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the year under review, there were no instances, where Board had not accepted the recommendations of the Audit Committee.

EXTRACT OF ANNUAL RETURN

The extracts of the Annual Return as required under the provisions of Section 92 of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014, amended up to date, is annexed herewith and marked as “Annexure-II” to this Report.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

Pursuant to Section 177 of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has in place a whistleblower policy to deal with unethical behavior, victimization, fraud and other grievances or concerns, if any. The Policy allows the whistle-blowers to have direct access to the Chairman of the Audit Committee and also protects them from any kind of discrimination or harassment. The aforesaid policy can be accessed on the Company’s website www.uttamsugar.in and weblink of the same is http://uttamsugar.in/pdf/whistle-blower-&-vigil-mechanism.pdf.

NOMINATION & REMUNERATION COMMITTEE

Pursuant to the provisions of Section 178 of the Companies Act, 2013 read with Rules made there under and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has a Nomination & Remuneration Committee and the details of terms of reference, number & dates of meeting held, attendance and other details are given separately in the attached Corporate Governance Report. The Board on the recommendation of Nomination & Remuneration Committee framed a policy i.e. Nomination and Remuneration Policy for selection and appointment of Directors, senior managerial personnel and their remuneration. The aforesaid policy can be accessed on the Company’s website www.uttamsugar.in and weblink of the same is http://uttamsugar.in/pdf/nrc-policy.pdf.

BOARD EVALUATION

As per the provisions of the Companies Act, 2013 a formal annual evaluation needs to be made by the Board of its own performance and of its committees and other individual directors. Performance evaluation of independent directors shall be done by the entire Board of Directors and criteria for performance evaluation is required to be framed by Nomination and Remuneration Committee. Accordingly, the Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of its committees comprising of audit, nomination & remuneration and other committees. The detailed analysis of performance evaluation is incorporated under Nomination and Remuneration head in Corporate Governance Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT UNDER SECTION 186 OF THE COMPANIES ACT, 2013

The Company has not given any loan or made any investment during the period under review in terms of section 186 of the Companies Act, 2013. However, the Company has provided guarantee in favour of IDBI Bank Ltd. for the Crop Loan given to cane growers under Corporate Tie-up Scheme, the details whereof are given in the accompanying Financial Statement under Note. No. 29.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1) OF THE COMPANIES ACT, 2013

All related party transactions entered during the year are negotiated on an arms-length basis and are in ordinary course of business. There have been no materially significant related party transactions made by the Company with the promoters, directors and key managerial personnel of the Company, which may be in conflict with the interest of the Company at large. Further, the suitable disclosure as required in AS-18 regarding Related Party transactions has been made in the notes to financial statements. The Company’s policy for Related Party Transaction is available on Company’s website i.e. www.uttamsugar.in and weblink of the same is http://uttamsugar.in/pdf/PolicyonRelatedPartyTransaction.pdf.

PARTICULARS OF EMPLOYEES

The particulars of employees, as required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are attached with this Report and marked as “Annexure-III”.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars in respect of Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo as required under Section 134(3)(m) of the Companies Act, 2013, are given in a separate annexure attached hereto and forms part of this Report and marked as “Annexure-IV”.

INTERNAL FINANCIAL CONTROLS

The Company has an adequate system of internal control relating to the nature of the business of the Company. A detailed note has been provided under Management Discussion and Analysis Report. The Company has an Audit Committee which ensures proper compliance with the provisions of the Companies Act, 2013 and Listing Regulations and also reviews the adequacy and effectiveness of the internal control.

EROSION OF NETWORTH OF THE COMPANY

As per the Audited Accounts of the Company for the financial year ended 30th June, 2015 the accumulated losses of your Company amounting to Rs 282.90 crores has resulted in erosion of more than 50% of its peak net worth during the four financial years immediately preceding the previous financial year. Hence, the Company has become a ‘Potential Sick Company’ as per the provisions of Sick Industrial Companies (Special Provisions) Act, 1985. Accordingly, such erosion and its causes were submitted before the shareholders of the Company in the Extra Ordinary General Meeting held on 26th February 2016. The same fact of erosion was also reported to Board for Industrial and Financial Reconstruction (BIFR).

We wish to inform you that we have taken various measures/steps for the improvement of Net Worth of the Company and impact of the same is also reflecting in the Audited accounts of the Company for the current financial year. These measures are expected to go a long way in improving the performance of the Company and we are committed to create long term value for the Shareholders.

LISTING AGREEMENT

The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 was issued by Securities and Exchange Board of India (SEBI), on 02^nd September, 2015 and the same was applicable from 01^st December, 2015. With the commencement of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 all the provisions of earlier Listing agreement was rescinded. Accordingly, all listed entities were required to enter into the new Listing Agreement within six months from the effective date. Accordingly, the Company entered into Listing Agreement with BSE Limited and the National Stock Exchange of India Limited.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There were no significant or material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status and Company’s operations in future.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Directors confirm that during the year under review, there were no complaints received pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

With the enactment of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014 read with various clarifications issued by the Ministry of Corporate Affairs, every Company having the net worth of Rs. 500 Crores or more or turnover of Rs. 1000 Crores or more or net profit of Rs. 5 Crores or more during any financial year have to spend at least 2% of the average net profit of the Company made during the three immediately preceding financial years.

The Company has constituted a Corporate Social Responsibility Committee (CSR ) as per the provisions of Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014, amended time to time and details of the same are given separately in the attached Corporate Governance Report. The CSR Committee had framed and finalized the CSR policy of the Company which was duly approved by the Board. The CSR policy of the Company can be accessed on the Company’s website: www.uttamsugar.in and weblink of the same is http://uttamsugar.in/pdf/CorporateSocialResponsibiltyPolicy.pdf.

Your Company has incurred losses for the financial year 2013-14, 2014-15 and meagre profit of Rs. 5.46 Crores for the financial year 2012-13. Since the aggregate of profit of previous three financial years is negative, your company was not required to spend any amount on Corporate Social Responsibility Activities during the financial year 2015-16.

RISK MANAGEMENT POLICY

The Company has a Risk Management policy to identify and evaluate Business Risk and opportunity of Risk Management to minimize the adverse impact on Business Objectives and enhancement the company’s competitive advantage. The policy facilitates to identify the risk at appropriate time and necessary steps to be taken to mitigate the risk. The detailed risk analysis and their mitigation have already been incorporated in the Management discussions and analysis report.

SUBSIDIARY COMPANIES

The Company does not have any Subsidiary, Associate and/or any Joint Venture Company.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There were no material changes and commitments affecting the financial position of the Company occurred during the financial year of the Company to which this financial statement relate and on the date of this report. CORPORATE GOVERNANCE

The report on Corporate Governance as stipulated under regulation 34 (3) read with Schedule V(C) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms an integral part of this Report. As per regulation 34 (3) read with Schedule V(E) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Certificate from a Practicing Company Secretary forms part of the Annual report are attached hereto and forms part of this Report and marked as “Annexure-V”.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

A separate Report on Management Discussion and Analysis for the year under review, as stipulated under regulation 34 (2) (e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is presented in a separate section and forms part of this Report and marked as “Annexure-VI”.

INDUSTRIAL RELATIONS

Industrial relations continued to remain cordial throughout the period under review.

ACKNOWLEDGEMENT

Your Directors thank the customers, suppliers, farmers, financial institutions, banks and shareholders for their continued support and co-operation. Finally, your Directors acknowledge the dedicated services rendered by all the employees of the Company.

For and on behalf of the Board of Directors

FOR UTTAM SUGAR MILLS LTD.

(ASHOK KUMAR AGARWAL) (RAJ KUMAR ADLAKHA)

Place : Noida EXECUTIVE DIRECTOR MANAGING DIRECTOR

Date : 11^th August, 2016 (DIN : 05199585) (DIN : 00133256)