As per records of the Company, including its register of shareholders/members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownerships of shares.
D. Rights & restrictions attached to equity shares:
The Company has one class of equity shares having a face value of H1 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors, If any is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.
E. Ag gregate number of bonus shares issued, shares issued for consideration other than cash during the period of five years immediately preceding the reporting date.-Nil
F. During the F.Y. 2024-25, the Company bought back 30,00,000 equity shares at a price of H105 per equity share and extinguished it on April 24, 2024.
G. The Board of Directors of the Company in its meeting held on Thursday, May 14, 2026 recommended final dividend of 10% (i.e. H0.10 per share on face value of H1/- per equity share for the F.Y. 2025-26,subject to approval of members in ensuing Annual General meeting .The Company has paid final dividend of 50% i.e. H0.50/- per share on face value of H1/- per equity share for the F.Y. 2024-25.
The amount shown above represents the best possible estimates arrived on the basis of available information. The uncertainties and timing of the cash flows are dependent on the outcome of the different legal process which have been invoked by the company or the claimants as the case may be and therefore it cannot be estimated accurately. The Company does not expect any reimbursement in respect of above contingent liabilities.
43 . Allahabad High Court in the case of PIL Rashtriya Kisan Mazdoor Sangathan VS State of U.P. passed a final order on March 09, 2017 directing the Cane Commissioner to decide afresh the issue as to whether the Sugar Mills are entitled for waiver of interest on the delayed payment of the price of sugarcane for the seasons 2012-13, 2013-14 and 2014-15 under the provisions of Section 17(3) of the U.P. Sugarcane (Regulations of Supply and Purchase) Act, 1953 (in short ‘the Act’). Thereafter in an CAPL (contempt application) No. 2815/2018 titled ‘V.M. Singh versus Shri Sanjay Bhoosereddy’ in the Hon’ble Allahabad High Court and its follow-on proceedings, the Cane Commissioner is understood to have filed an affidavit specifying interest rates on delayed cane price payments but no such order of the Cane Commissioner has been served on the Company or industry association. Subsequently, the State Government filed a modification application and Mr. V. M. Singh filed an SLP in the Supreme Court. Pending the outcome of these matters, the High Court has deferred the contempt petition hearing. The matter is still pending before the Supreme Court for adjudication. Based on the legal review of the facts of this case, possibility of liability crystalizing is remote and hence has not been considered as contingent liability.
44 . Cane societies were in dispute with the State Government of Uttar Pradesh with regard to retrospective partial waiver
of society commission payable by the sugar mills for the crushing seasons 2012-13,2014-15 and 2015-16 as a part of its relief package to sugar industry. Hon’ble Allahabad High Court held that concessional rate of society commission fixed by the U.P. Government cannot have retrospective operations and shall be applicable prospectively from the date of the notification. Against the said judgment, the U.P. Sugar Mill Association filed SLP ( C ) No 032225-032227/2018. Hon’ble Supreme Court, vide order dated 03.12.2018, issued notice and directed that no coercive steps shall be taken against the petitioners. The matter is pending for further adjudication. Based on the legal advice, possibility of liability crystalizing is remote and hence has not been considered as contingent liability.
45 . The Collector and Tax Assessing authorities has raised demands for the arrears of purchase tax for the sugar season
2016-17 aggregating to H88.06 Lakhs along with penalty of H1.05 lakhs in respect of purchase tax due on sugar stock held by mill as on 30.06.2017, the date at which the purchase tax has been subsumed in the Goods and Service Tax. The levy of purchase tax on sugar stock held by the mills as on 30.06.2017 has been challenged by U.P sugar Association before Lucknow Bench of Hon’ble Allahabad High Court in writ petition No 27169 of 2018 and the same is still pending for adjudication. However, the Hon’ble High Court has advised the authorities to desist from adopting any coercive measure till the final decision of the case. Based on the legal review of the facts of the case, the management estimates that the probabilities of crystallization of aforesaid demand is remote and the aforesaid amount has not been considered as contingent liability.
46.Leases
Following are the changes in the carrying value of other right of use assets for the year ended March 31, 2026:
The aggregate depreciation expense on ROU (Right-of-use) assets is included under depreciation and amortization expense in the statement of Profit and Loss.
Difference between the value as per books of accounts and as per quarterly statement submitted to lenders:
The company has availed working capital finance of more than five crores during the year from the aforesaid mentioned lenders against primary security of current assets. As per terms and conditions, the drawing power for utilization of the sanctioned working capital facilities is determined based on the value of stock reported to the banks on weekly basis as well as at the end of the each quarter. The following differences with regards to the adoption of valuation rates exist between the quarter end stock statements and books of accounts: -
a) Stock of sugar is valued at the minimum support price announced by Central Government in the stock statement but is valued at lower of cost of production or net realizable value in the books of account at the time of preparation of quarterly financial statements.
b) Stock of ethanol is valued at the price as fixed by Central Government in the stock statement but is valued at lower of cost of production or net realizable value in the books of account at the time of preparation of quarterly financial statements.
c) Stock of “B” Heavy Molasses is valued at the price agreed with the lenders in the stock statement but is valued at derived net realizable value in the books of account at the time of preparation of quarterly financial statements.
Due to aforesaid reasons, there will be always be mismatch in the value of stock as reported in the stock statements and in the value as disclosed in the books of account which are tabulated as under: -
(i) The Board and CSR Committee approved the project to contribute funds up to 60% cost of setting up a inter college by the UP State Government under Matrabhumi Yojana under its CSR activities during the F.Y. 2024-25. The estimated share of the Company in the cost of the project is presently estimated at H415.80 Lakhs. The Company incurred expenditure of H1 Lakh on payment of fee for the project and contributed H250 Lakh in the Escrow account during the F.Y. 2024-25. Since the amount contributed in Escrow account remained unspent as at 31.03.2026, the same has not been considered as CSR expenditure spent but shown as advances for CSR Expenditure. The Company is continuously following up with the concerned authorities for the initiating progress in the matter .
(ii) Unspent CSR obligation as at the end of current year amounting to H210.79 Lakhs has been provided for and deposited in a separate bank A/c on April 29, 2026 in compliance with Provision of sub section 6 of Section 135 of Companies Act ,2013.
c) Donation and Contribution:
Nil
d) Particulars of revenue from operations & inventory
Revenue
The details of performance obligations in terms of Ind AS 115 - “Revenue from Contracts with Customers” are as follows:
(i) Sugar
The Sugar segment of the Company principally generates revenue from the sale of sugar, its by-products, and co-generated power to distribution companies.
Domestic sales of sugar are made on ex-factory terms or agreed terms to wholesale, institutional buyers, or merchant exporters within the country and revenue is recognised when the goods have been delivered to the buyer’s specific location(as per agreed terms). Domestic sugar sales are mainly done on advance payment terms.
Export sales of sugar to merchant exporters are done on ex-factory or delivered basis in terms of the agreement, and revenue is recognised when the goods have been delivered to the buyer’s specific location (as per agreed terms). The sale price are fixed as per contracted terms.
Revenue from co-generated power is recognised on power supplies to distribution companies from the Company’s facilities in accordance with the terms of the Power Purchase Agreements (“PPA”). Revenue is also generated from co-generated power supplied from the Company’s facilities under open access arrangements, as authorised by regulatory authorities. Revenue is recognised when control of the power is transferred to the customer, which occurs at the point of delivery through the transmission or distribution system, in accordance with the terms of the agreement.
Bagasse and Pressmud are generally sold on advance payment terms to customers on an ex-factory basis or agreed terms as per the agreement, and revenue is recognised when the goods have been delivered to the buyer.
Pressmud and other residue products to certain private entities is supplied from the Company’s facilities as per the conditions stated in the long-term supply contract. Revenue is recognised when the goods have been delivered to the buyer.
(ii) Distillery
The distillery segment of the Company principally generates revenue from the sale of industrial alcohol, which mainly constitutes ethanol sold under contracts with Public Marketing Companies (“OMCs”). Ethanol is sold on a delivered basis as per the agreement, and revenue is recognised when the goods have been delivered to the Public OMC’s locations (as per agreed terms). The sale price is determined based on the Expression of Interest (“EOI”) or Tender floated in case of Public OMCs.The payment terms in the case of Public OMCs are within 21 days after the delivery of the material and submission of original invoices.
Other products like Liquid CO2, etc., are sold in bulk to private entities on an ex-factory basis as per agreed terms. Revenue is recognised when goods have been delivered to the buyer’s specific location as per agreed terms. The payment terms is up to 30 days.
(iii) Others
The Others traded goods principally generates revenue from the sale of agricultural fertilizers and pesticides and the same is done on cash basis directly to growers.
51. Segment information for the year ended March 31, 2026 prepared under Ind AS 108
(i) Shri Vijay S Banka ,Managing Director has been identified as the Company’s Chief Operating Decision Maker (CODM) in terms of Ind AS 108 - “Operating Segments”. The CODM evaluates the Company’s performance and allocates resources based on an analysis of various performance indicators by business segments. The CODM of the Company evaluatesthe segments based on growth, operating income and return on capital employed.
In addition, revenue and expenses have been allocated to a segment based on the segment’s operating activities. Revenue andexpenses which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed as “Unallocable”. Segment assets and segment liabilities represent assets and liabilities of respective segment. Investments, tax related assets/ liabilities and other assets and liabilities that cannot be allocated to a segment on reasonable basis have been disclosed as “Unallocable”
(a) Inter-segment revenues are eliminated upon consolidation and reflected in the “adjustments/eliminations” column. Finance income and costs, and fair value gains and losses on financial assets are not allocated to individual segments as the underlying instruments are managed at Company level. Current taxes, deferred taxes and certainfinancial assets and liabilities are not allocated to the segments as they are also managed at Company level.
(b) Transactions between segments are primarily transferred at cost/ transaction price based on current estimated market prices. Common costs are apportioned on reasonable basis.
(c) Figures in bracket pertains to previous year.
These sensitivities have been calculated to show the movement in defined benefit obligation in isolation and assuming there are no other changes in market conditions at the accounting date. There have been no changes from the previous periods in the methods and assumptions used in preparing the sensitivity analyses.
Special events:
There are no special events such as benefit improvements or curtailments or settlements during the intervaluation period.
The Company is exposed to various risks in providing the above gratuity benefit which are as follows:
Interest Rate risk : The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability (as shown in financial statements).
Salary escalation risk : The present value of the defined benefit plan is calculated assuming a future salary increase of 6% per annum for plan participants. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan’s liability.
Actual mortality & disability : deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities.
(d) The company’s liability on account of Compensated Absences are determined at end of each Financial Year on the basis of Actuarial Valuation certificates obtained from registered actuary and company’s policy of compensated absence. The company’s Compensated Absence Policy is as follows:
General Policy: The Leave Cycle is Considered from January 1 to December 31
Accrual of Leave: The number of Leaves that accrue during the year for Permanent Officers is 15 days, Permanent Technical is 18.25 days and for Management and others is 30 days
Accumulation Limits: Maximum Leave allowed to be accumulated for encashment as well as for availment in case of Management is 90 days, Permanent Officer is 45 days, Permanent Technical is 30 days and for others, actual leave balance without any ceiling. Leaves in excess of maximum can be enchased.
(e) Social responsibility is a company’s commitment to manage the social, environmental and economic effects of its operations responsibly and in line with public expectations. Dwarikesh Sugar Industries Limited emphasises utmost importance on its social responsibilities towards its stakeholders and makes continuous efforts to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large.
The Company has adopted various policies such as Corporate Social Responsibility policy, Environment policy, Code of Conduct & Ethics and makes sure that strict adherence is followed for the same.
Various committees have been constituted by the Company for periodical reviews & checks of the line of actions under these policies.
52 (B) With effect from November 21, 2025, the Government of India has consolidated existing labour legislations into a unified framework comprising four Labour Codes collectively referred to as the ‘New Labour Codes’. However, the corresponding Rules under these New Labour Codes are yet to be notified. The Company has estimated and recorded defined benefit obligation based on the best available information and review of the existing wage structure. The Company continues to monitor the finalisation of Central/State Rules and clarifications from the Government of India on several aspects of the New Labour Codes and would provide appropriate accounting effects based on such developments and consequent management decisions in this regard.
III Fair Value Hierarchy
The fair value of the financial assets and financial liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. All the assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised with in the fair value hierarchy described as follows, based on lowest level input i.e. significant to the fair value measurement as a whole.
The following table provides the fair value measurement hierarchy of Company’s asset and liabilities, grouped into Level 1 to Level 3 as described below :-
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily indicative of the amounts that the Company could have realized or paid in sale transactions as of respective dates. As such, the fair value of financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.
55. Financial risk management objectives and policies Financial risk factors
The Company’s principal financial liabilities includes borrowings, trade payable and other financial liabilities. The main purpose of these financial liabilities is to finance the Company’s assets and operations. The Company’s principal financial assets include trade receivables, cash and cash equivalents and other financial assets that are derived directly from its operations. The Company is exposed to credit risk, liquidity risk and market risk. The Company’s senior management oversees the management of these risks and the appropriate financial risk governance framework for the Company is in place. The senior management provides assurance that the Company’s financial risk activities are
governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. It is the Company’s policy that derivatives whenever used are used exclusively for hedging purposes and not for trading or speculative purposes. The Audit Committee and the Board are regularly apprised of these risks every quarter and each such risk and mitigation measures are extensively discussed and the same are summarized below:
The Company’s activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company’s primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. One of the market risk to the Company is foreign exchange risk. The Company uses derivative financial instruments to mitigate foreign exchange related risk exposures. The Company’s exposure to credit risk is influenced mainly by the individual characteristic of each customer.
A. Credit risk :
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, thereby leading to a financial loss. The Company’s major exposure of credit risk is from bank deposit and trade receivables. The Company’s sugar sales are totally on cash. Power and ethanol are sold to state government entities, thereby the credit default risk is significantly mitigated.
The impairment of trade receivables are based on assumption about risk of default and expected loss rates. The company uses judgements in making these assumption and selecting the inputs for the impairment calculation based on past history, existing market condition as well as forward looking estimates at the end of each balance sheet date. Financial assets are written off when there is no reasonable expectation of recovery. However the Company continues to attempt to recover the receivables. The Company follows simplified approach for measuring expected credit loss for trade receivables, except for credit impaired trade receivables which are fully provided for. The aging analysis of trade receivable is as under:-
B. Liquidity risk :
The liquidity risk is defined as the risk that company will not be able to settle or meet its obligation on time or at a reasonable price. The Company’s objective is to maintain optimum level of liquidity to meet its cash and collateral requirement. The Company’s management is responsible for liquidity , funding as well as settlement management. In addition process and policies related to such risks are overseen by senior management. Management monitors the company’s net liquidity position through rolling forecast on the basis of expected cash flow.
C. Market risk :
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate consequent up on changes in market prices. It mainly comprises of regulatory risk, commodity price risk & interest rate risk, which are discussed herein below:
Foreign Currency Risk
Foreign Currency Risk is the risk that the fair value or future value or future cash flow of an exposure will fluctuate due to changes in foreign exchange rate. To mitigate foreign exchange risk, the Company covers its position through permitted hedging methods. There is no foreign currency exposure as at 31st March, 2026 and 31st March, 2025.
i. Interest rate risk :
Interest rate risk is a risk that the fair value of future cash flows will be impacted because of the changes in the market interest rates. Such risks mainly related to borrowings of the company with floating interest rates.
ii. Regulatory risk :
The sugar industry is regulated both by the Central Government as well as the State Government. Central and State government policies and regulations affect the sugar industry and the Company’s operations and profitability. The distillery business is also dependent on government policy.
iii. Commodity price risk:
The major segment in which the Company operates is Sugar, which accounts for around 76% of the Company’s total revenue; as such, the Company is exposed to commodity price risk.
The Government announces domestic sales quotas on a monthly basis. There are not many active platforms in India that allow hedging of domestic sugar sales. The Central Government had announced a Minimum Sale Price (MSP) for the sale of sugar in the open market by every sugar mill. Currently set at H31/- per kilogram, this MSP acts as a minimum floor price for the sale of sugar by the sugar mills in India.
The pricing methodology for ethanol remained unchanged. Ethanol prices are announced by the Central Government which are based on Fair and Remunerative Price (FRP) of sugarcane, cost of production of sugar and realisation of by-products.
56.Capital management
The Company’s policy is to maintain a strong capital base so as to sustain investor, creditor and market confidence and to support future development of the business. The primary objective of the Company’s Capital Management is to maximise the shareholder value. Management also monitors the return on capital. The Board of Directors seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowing and the advantages and security afforded by a sound capital position. Sugar being a seasonal industry, it is highly capital and working capital intensive, therefore required to raise need based short-term, and long-term debt for smooth running of the operations.
57. Impairment review:
Assets are tested for impairment whenever there are any internal or external indicators of impairment. Impairment test is performed at the level of each Cash Generating Unit (‘CGU’) or groups of CGUs within the Company at which the assets are monitored for internal management purposes, within an operating segment. The impairment assessment is based on higher of value in use and value from sale calculations. During the year, the testing did not result in any impairment in the carrying amount of other assets. The measurement of the cash generating units’ value in use is determined based on financial plans that have been used by management for internal purposes. The planning horizon reflects the assumptions for short to- mid-term market conditions.
Key assumptions used in value-in-use calculations are:-
(i) Operating margins (Earnings before interest and taxes), (ii) Discount Rate, (iii) Growth Rates and (iv) Capital Expenditure
58 . Based on the incentive policy announced by the State Government of Uttar Pradesh vide order no. -1631 (1) S.C./ 18-02-2004-57/ 2004 dated 24.08.2004 to encourage investment in the State, the company proceeded to invest amount in excess of threshold limit as set out in the policy for availing various benefits over ten years period. On 04.06.2017 the policy was unilaterally withdrawn vide G.O. No. 1216 S.C/18.02.2007-185/2006.
Aggrieved by the said order of withdrawal, the Company and other aggrieved sugar companies challenged the order by filing appropriate writ petitions. Hon’ble High Court on 12.02.2019 passed an order quashing & setting aside the order withdrawing the incentive scheme and held the same to be in violation of principle of estopple & natural justice. Company has since then written to competent authorities and submitted the requisite information/documents in support of its claims, the matter is yet to be concluded by the authorities.
59. The Central Government, vide its Notification No. 1(10)/2018-SP-I dated July 19, 2018, notified a Scheme for extending financial assistance to sugar mills for enhancement and augmentation of ethanol production capacity. Every Sugar Mill which fulfils the conditions stipulated in the scheme will be eligible for interest subvention @ 50% of the rate of interest charged by bank, which shall be borne by central Government for a period of five years on diminishing balance of the loan availed for the said purpose. For the financial year ended March 31, 2026, the Company has complied with all the conditions as stated in the scheme and submitted the requisite claim for interest subvention. The interest subvention, so accrued under the Scheme for the year ended 31st March 2026 is H514.57 Lakhs of which an amount of H144.84 Lakhs has been received.
60. Events occurring after the balance sheet date:
No adjusting or significant non adjusting events have occurred between the reporting date and date of authorization of financial statements.
63.Other Statutory information
i) The Company does not have any benami property, and no proceeding has been initiated against the Company for holding any benami property.
ii) The Company does not have any transactions with struck off companies during the year.
iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
iv) The Company has not traded or invested in crypto currency or virtual currency during the financial year.
v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or
b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Group shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or
b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.
vii) The Company has not entered in any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).
viii) The Company has not been declared wilful defaulter by any banks or any other financial institution at any time during the financial year.
65 . In the opinion of Board of Directors, trade receivable, other current financial assets and other current assets have a
value on realisation in the ordinary course of the company’s business which is at least equal to the amount at which they are stated in the balance sheet.
66 . The Board of Directors at its meeting held on Thrusday, May 14, 2026 has approved the financial statements for the
year ended March 31,2026.
|