AFFLUENCE

Dear Shareholders,

YourDirectorshavepleasureinpresentingtheSixtySecondAnnualReportonthebusinessandoperationsofthe

Company and the audited financial accounts for the year ended 31stMarch, 2017.  

FINANCIALPERFORMANCE

(`in Lakhs)

Division wise SalesTurnover

(`in Lakhs)

OPERATING HIGHLIGHTS

OnaStandalonebasis,yourCompanyhaveachievedSalesTurnoverof` 98,515 Lac for the financial year 2016-17ascomparedtotheSalesTurnoverof`136,478Lacsinthepreviousyear.ThedropintheSalesturnoverismajorly on account of reduction in sugarcane crushing and recovery which resulted into low sugar and ethanol sales and lower power exports and prices. This was further accentuated due to Government of India's measures like sugar stock limits ontradersandsugarmills,demonetizationanddumpingofsurplussugarproducedbyUP millsinthemarketwhich affected our Sugar sales volume during FY2016-17.

Duringtheyearunderreview,yourcompanyreportedLossof`4,495Lacsasagainstlossof`1,129LacsinFY2015-16. On a consolidated basis, the turnover is`1,00,634 Lacs and the loss after tax is`4,824 Lacs.

DIVIDEND

In view of loss incurred during the year, your Directors regret their inability to recommend any dividend for FY2016-17.

DIRECTORS'RESPONSIBILITYSTATEMENT

Your Directors'state that:

a)   In the preparation of the annual financial statement for the year ended 31st March, 2017 the applicationaccounting standards have been followed with no material departures;

b)   Haveselectedsuchaccountingpoliciesandappliedthemconsistentlyandmadejudgmentsandestimatesthat arereasonableandprudentsoastogiveatrueandfairviewofthestateofaffairsoftheCompanyasat31stMarch, 2017 and of the profit and loss of the company for that period;

c)   Proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisionsoftheCompanies Act,2013forsafeguardingtheassetsoftheCompanyandforpreventingand detecting fraud and other irregularities;

d)   The annual financial statements have been prepared on a going concern basis;

e)   Proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

INDUSTRYOUTLOOK - SUGAR: (A)  Sugar Production In India:

SugarproductioninIndiaduringseason2016-17isestimatedtobe203LacMTi.e.,19%lowercomparedwithprevious year(251LacMT)duetodroughtsituationinthestatesofMaharashtra,Karnataka,Tamilnadu, AndhraPradesh (Seemandhra)andTelangana. Thisproductionisthelowestinthelast7years. Thesugarcaneproductioninthedrought affected states was substantially lower by about 40-50% than the last year.

State

PRODUCTION

(In Lac tons)

2015-16 2016-17

Maharashtra  84.10 42.01

Karnataka  40.29 20.51

Uttar Pradesh  68.40 87.73

All India basis  248.23 203.00

Source: Indian Sugar MillsAssociation (ISMA)

StateofUPwhichnormallyproducesabout65LacMTsofSugarhasproducedabout87.73LacMTsofsugarin the Current season. Sugar production in Karnataka State, (wherein our Sameerwadi sugar factory is located) and MaharashtraStatehasrecordedalmost50%reductioninsugarproductioncomparedtolastyear. Inviewofthefall inallIndiasugarproduction,thesugarbalancesheetfortheseasonwouldshowstockofabout43LacMTsason

30th September, 2017 as against 77 Lac MTs as on 30th September, 2016.

Indian Sugar Production, Supply and Distribution (Figure in Lac MT)

(in Lac tons)

Source: Indian Sugar MillsAssociation (ISMA)   (P) - Provisional and (E) - Estimated

(B)  Sugarcane production in Karnataka

Thetotalsugarcaneacreageinthecountryin2016-17camedowntolessthan50lachectares-reductionof5.5%over the previous season.

State of Karnataka is facing double-like situation due to the deficiency in monsoon rains reason from 2015 onwards. This has severely affected the plantation of the sugarcane, yield of sugarcane per hectare and the sugar content in sugarcane. TheareaundersugarcaneplantationinKarnatakadeclinedfrom5.10lachectaresin2015-16to4.15lac hectares during 2016-17.

ThesugarproductioninKarnatakahas,duetothereasonsmentionedabove,comedownto20.51LacMTsagainst

40.29LacMTsoflastyear.Duetothelowercaneavailability,mostofthesugarmillsintheStateofKarnatakaoperated forlessthan90days.Duetothis,thecapacityutilisationofmostofthemillsintheStatewasbelow50%whichresulted in the steep increase in the cost of production of sugar.

Sugarcane Pricing:

Sugarcane price for the season 2013-14, 2014-15 and 2015-16:

South Indian Sugar Mills association, Karnataka, on behalf of its Members, including our Compnay, had filed an appeal before the Supreme Court against the coercive steps taken by the Karnataka State Government for recovery of the disputed sugarcane price, fixed by the Karnataka Sugarcane Control Board, for the season 2013-14. Hon'ble Supreme Courtgrantedstayinthematteragainsttherecoveryofthepaymentofthebalancecanebill(whichwas`100/MToutof the cane price of`2,500/MT) and coercive action by the Government till the matter is decided by the Court.

Meanwhile,KarnatakaGovernmentofferedtowaiveoffsugarcanepurchasetaxfortheseasons2016-17and2017-18to thosemillswhocompletethefollowingcanepayments,includingthedisputedpaymentagainstseason2013-14,before

31st July, 2016:

1.  Balance of`100/MTfor the Season 2013-14.

2.  FRPfor the season 2014-15.

3.  FRPfor the season 2015-16.

InviewoftheaboveofferbytheStateGovernment,privatesugarmillsinthestate,includingyourcompany,decidedto avail this benefit and pay the disputed under protest while keeping the appeal before Supreme Court alive.

Our Company decided to accept the offer of the State Government; we have therefore cleared the liabilities against sugarcane payments for the seasons 2013-14, 2014-15 and 2015-16. Government of Karnataka has issued certificate regarding clearance of dues for the above 3 seasons.

Sugarcane price for the season 2016-17:

Government of India has accepted recommendation of Commission forAgricultural Costs and Prices (CACP) regarding sugarcanepriceof`2,300/MTasFRPlinkedto9.5%recovery.FRPapplicabletoSameerwadisugarfactoryforseason

2016-17worksoutto`2,782/-ex-factoryincludingHandTchargesbasedontheactualsugarrecoveryof11.49%for

season 2015-16.

GOVERNMENT POLICYFOR CONTROLLING INFLATORYSUGAR PRICE:

GovernmentofIndiacameupwithvariousstrategiestocurtailtheshortagesituationinIndia.Thesepoliciesweremajorly focused towards mechanism of adequate sugar availability and controlling Sugar price in the market.

1.  Imposed sugar stock holding limits on sugar traders and sugar mills.

2.  Government levied export duty 20% on exports or raw, white and refined sugar which have now made the sugar exports unattractive as compared to domestic market.

3. Duty on import of sugar under the Open General License (OGL) is 40 percent.

4. Government allowed duty free imports of raw sugar for 5 Lac MTunderTariff Rate Quota (TRQ).

SAMEERWADI SUGARFACTORY:

Sameerwadisugarfactorycrushed11.85LacMTofsugarcaneinFY2016-

17withsugarproductionof12.12LacQtlsasagainstcrushingof23.29

Lac MTcrushing with Sugar production of 27.03 Lac Qtls in previous year.

Duetocontinuousdroughtduringlast3years,theavailabilityofcane hascomedownbyalmost50%ofthenormalsupply. Thishadadverse effect on quality and quantity of cane availability for the season 2016-17. The average recovery of Sugar from sugarcane dropped to 10.23% in the current year from11.29% in the previous year.

Sugar season 2017-18.

SameerwadisugarfactoryhasachievedhighestsugarcanecrushingandproductioninSouthIndiaasasingleunitfor season 2016-17.The factory has consistently maintained its premium position in terms of Sugar production.

Sugarsaleshavebeenadverselyaffectedduringtheyear2016-17.Oursalesdroppedbyabout50%comparedtothe previous year especially in Wholesale and Retail segments due to following economic factors:

a. Demonetization of Currency.

b. Dumping of excess sugar produced by Uttar Pradesh mills in the market.

Trend in Domestic Sugar prices:

Sugar prices started to rise due to lower production forecasts because of drought conditions that affected cane planting in Maharashtra and Karnataka. Decline in production for Sugar Season 2016-17 has stimulatedthedomesticsugarprices. AllIndiaaverageex-millsugar priceshaveincreasedbyabout35%againstthepreviousyear.Average AllIndiasugarpricessurgedfrom`2,570/quintalinthepreviousyearto

`3,495/quintal in the current year.

Exports:

We have exported sugar during the year as per the quota allocated on the basis of Minimum Indicative Export Quota (MIEQ) announced by the Government. With Government's imposition of 20% Export duty on sugar exports, Sugar exports from India have become unavailable.

"Jivana":

Jivana Classic Sugar comes from our sugar refinery in Karnataka Superior quality sugarcane, eco-friendly farming practices, innovative and certified production processes, and stringent quality controlensurepurity,hygieneandconsistencyinoursugar.Jivana sugar sales have increased by over 65% in the current year as compared to the previous year.

JivanaSaltismarketedinthesameregionslikeJivanaSugar.SaleofJivanaSalthasincreasedbyover25%as compared to the previous year.

DISTILLERYDIVISION:

SameerwadiDistilleryunitcaterstothedemandofbeverageindustry,fuelindustryandchemicalindustrywithvarious grades ofAlcohol.

GapbetweenOilMarketingCompanies(OMCs)Requirementand

Final orders is high in 2016-17 (Dec-Nov) due to:

a.  DownwardrevisionofEthanolpricei.e.` 39 per litre as  

fixedby the Government and

b. Withdrawalofthewaiverofcentralexcisedutyfromethanol i.e. by about`5 per litre.

2016-17:

The Company has contracts with OMCs for 7 Million litres against previous year's 17.91 Million litres.

WehadtoreducethequantityofferedtoOMCsduetoshortage of Molasses during the Sugar Season 2016-17, as well as downward revision in Ethanol price and Removal of Exemption on Excise duty.

Sameerwadidistillery,tobemoreenvironmentalfriendlyhassuccessfullyinstalledIncinerationBoilerinApril2017.ThiswouldenableustoachieveZeroLiquidDischarge(ZLD)for distillery. With this, we expect to improve the capacity utilization of the distillery.

COGENERATION DIVISION:

Cogenerationdivisionhasgenerated121,710MWHrinthecurrentyearascomparedtothepowergenerationof193,365

MWHrinthepreviousyear. ThisreductionisduetolowersugarcanecrushingandresultantlowerBagasseavailability. Initially, Company sold its power on IEX, where the power rate was low about`2.5-2.8/Kwh.

PPA hasbeensignedinJanuary2017fortheperiodof5years. AccordinglyKPTCL gavetheclearancetostarttheexportofpower underTemporaryTariff`3.47/Kwhr.KarnatakaElectricityRegulatory Commission (KERC) has by its order revised the price based of commissioning dates of Cogeneration plants.

CogenerationplantshaveundertakencapacityenhancementofUnit-1boilerfrom130 TPHto140 TPHandcapacity enhancement of Unit-2 boiler from 120 TPH to 132 TPH. This will improve the operating efficiencies during the next season and will result in lower Bagasse consumption.

SAKARWADI CHEMICALDIVISION:

SakarwadiChemicalDivisionhasrecordedasalesturnoverof`34,788LacsfortheFY2016-17againsttheprevious yearsalesturnoverof`37,817Lacsi.e.dropinsalesturnoverbyabout8%.DespiteofdecreaseinSalesturnover of Chemical division, the Operating performance of Sakarwadi chemical division has been improved compared to the previous year.

Low availability of cane and resultant low availability of Molasses in the domesticmarketcoupledwithdomesticproductionbeingdivertedtothe petrolblendingprogramresultedintosupplycrunchofEthanolinthedomestic market. We, being Ethanol based chemical manufacturer, had to fill the gapbetween demand and supply through import of Ethanol for manufacturing Chemicals.

EthylAcetatepricesinEuropeanmarketwereabout7%lowerthanthepreviousyear.Thiscoupledwithincreasein ocean freight has affected sales realization from exports in the current year.

Factors that helped to improve the chemical business performance are:

�  ContinuousassessmentofchemicalmarketandscrupulouslymonitoringoftheprocurementofRawmaterials and selling of EthylAcetate on "spot basis" depending upon the market price.

�  Changeinourchannelofsalesinthedomesticmarketi.e.shiftfromtraditionaldealerchanneltodirectsaleto the customer.

AWARDS and RECOGNITION:

The Company has received the followingAwards during the FY2016-17:

�  Indian Chemical CouncilAward - 2016 forWater Resource Management.

�  FICCI Chemicals and Petrochemicals Awards - 2016 for Efficiency in Water Usage for Chemicals.

NEW PROJECTS:

New chemicals and Bagasse based Bio -refinery in Sameerwadi

We had applied for permission to Karnataka Government under the Karnataka Udyog Mitra (KUM) program for setting up of ethanol based specialty chemicals plant and Bagasse based bio-refiney at Sameerwadi. We are happy to inform that we have received approval from State High Level Clearance Committee for these projects.

REVIEW THE STATUS OF IMPLEMENTATION OF SEBI ORDER:

UndertheSEBIOrderdated1stJanuary,2016yourCompanyandtheSameerwadiSugarcaneFarmers'WelfareTrust were directed to comply with the direction of the Hon'ble SEBI and file a Compliance Report within 12 months from the date of the aforementioned order. Pursuant to the order issued by SEBI, your Company has filed Compliance Report with the Hon'ble SEBI on 22nd December, 2016.

TheCompanyandTrustreceivedlettersdated7thMarch,2017fromSEBIwheretheHon'bleSEBIaccededtothe

Company's prayers and issued further directions to your Company.

In view of the same your Company completed all the formalities that were required to be done to comply with the directions issued by SEBI and on 10thApril, 2017 through its advocates, filed a report with SEBI together with the documents evidencing compliance with the directions issued on 7th March, 2017.

SUBSIDIARIES andASSOCIATES COMPANIES

Ason31stMarch,2017,yourCompanyhadfour(directandindirect)subsidiaries(OneinIndiaandthreeoverseas),the

Company does not have any joint venture companies and associate company.

SolarMagicPrivateLimited, India

Cayuga Investments B.V., Amsterdam

Godavari

Biorefineries

B.V., Amsterdam

Godavari

Biorefineries 

Inc.,USA

i.  Solar Magic Private Limited (CIN: U01100MH1998PTC113856)

Thesubsidiaryisengagedinmanufacturingoffarmproductsandprovidesservicestothefarmersbywayofsaleand supply of fertilizers, irrigation facilities and other agriculture inputs.

ii. Cayuga Investments B.V. (KVK NO: 34319213)

TheSubsidiaryisengagedininvestmentactivities.CayugahasfollowingtwosubsidiarieswhicharetheStepDown Subsidiaries of Godavari Biorefineries Limited.

    a. Godavari Biorefineries B.V. Amesterdam (KVK NO : 34325188)

TheStepDownSubsidiaryofthecompanyactsasintermediaries,consultantstoprovidesupportservices, penetrate European markets.

    b. Godavari Biorefineries Inc., USA (EIN : 30-0546856)

TheCompanycarriedonthebusinessasintermediaries,consultantstoprovidesupportservices,penetrates

USAmarkets during the year.

CONSOLIDATED FINANCIALSTATEMENTS

The consolidated financial statement of the Company and its subsidiaries , prepared in accordance with Accounting Standard21issuedbytheInstituteofCharteredAccountantsofIndia(ICAI),formspartoftheAnnualReportandare reflected in the consolidated financial statement of the Company. In compliance with section 129 of the Companies Act, 2013 a statement containing requisite details including financial highlights of the operation of all the subsidiaries in

FormAOC-1is annexed to this report.

MATERIALCHANGES and COMMITMENTS

There have been no material change and commitments that have occurred after close of the financial year till the date of this report, which effect the financial position of the Company. Based on internal financial control framework andcompliancesystemsestablishedintheCompany,theworkperformedbyStatutory,Internal,SecretarialAuditors andreviewsperformedbythemanagementand/orrelevantAuditandotherCommitteesoftheBoard,yourBoardis of the opinion that the Company's internal financial controls were adequate and working effectively during financial year 2016-17.

DETAILS OF BOARD MEETINGS

During the financial year under review, four meetings if the Board of Directors were held on 24thMay, 2016 1stSeptember, 2016, 5th November, 2016 and 21st February, 2017. Particulars of Directors, their attendance at the Board Meetings held during the FinancialYear 2016-17 are as under:

DIRETORSAND KEYMANAGERIALPERSONNEL

During the year Dr. B. R. Barwale, Director of the Company had tendered his resignation from the Board of Directors of your Companyw.e.f. 1st September, 2016 due to advanced age.

Currently your Board comprises of eleven (11) Directors including three (3) Independent Directors, four (4) Executive Directorsandfour(4)Non-ExecutiveDirectors.IndependentDirectorsprovidetheirdeclarationsbothatthetimeof appointment and annual confirming that they meet the criteria of independence as prescribed under Companied Act,2013 and Listing Regulations.

Mr.MohanSomanathanwasappointedasDirector(Works)ofSakarwadiunitwitheffectfrom1stSeptember,2016,and the same was approved by the members at theAnnual General Meeting (AGM) held on 30th September, 2016.

Mr.Bableshwarwasre-appointedasDirector(Works)ofSameerwadiunitwitheffectfrom1stApril,2017,andthesame will be placed for approval at the ensuingAGM.

InaccordancewiththeprovisionsoftheActandtheArticlesofAssociationoftheCompany,Dr.PreetiSinghRawat,Non- ExecutiveDirectorandMr.MohanSomanathan,Director-Works(Sakarwadiunit)oftheCompany,retiresbyrotationat the ensuingAGM, and being eligible, have offered themselves for re-appointment.

IncompliancewiththerequirementsofSection203oftheCompaniesAct,2013,Mr.SamirSomaiya,Chairmanand Managing Director Mr. Naresh Khetan, Chief Financial officer Ms Nishi VijayVargiya, Company Secretary and Compliance Officer of the Company continue as Key Managerial Personnel of the Company.

DECLARATION FROM INDEPENDENT DIRECTORS

TheIndependentDirectors,havesubmittedadeclarationthateachofthemmeetthecriteriaofindependenceasprovided insubsection(6)ofSection149oftheCompaniesAct,2013andtherehasbeennochangeinthecircumstanceswhich may affect their status as Independent Director during the year. In the opinion of the Board, the Independent Directors possess appropriate balance of skills, experience and knowledge, as required.

BOARD EVALUATION

The Independent Directors of your Company, in a separate meeting held without presence of other Directors and management evaluated performance of the Chairman, Managing Director and other Non-Independent Directors along with performance of the Board and its Committees based on various criteria recommended by Nomination and RemunerationCommittee. A reportonsuchevaluationdonebyIndependentDirectorswastakenonrecordbythe BoardandfurtheryourBoard,incompliancewithrequirementsofCompaniesAct,2013,evaluatedperformanceofall Independent Directors based on various parameters including attendance, contribution etc.

BOARD COMMITTEES

IncompliancewiththerequirementsofCompaniesAct,2013and  ListingRegulations,yourBoardhadconstituted variousBoardCommitteesincluding AuditCommittee,NominationandRemunerationCommittee,ShareTransferand Allotment Committee.

AUDIT COMMITTEE:

Currently the Audit Committee of the Board comprises of five (5) Diretors including Mr. Kailash Pershad, as chairman, Mr Samir Somaiya, Dr. K.V. Raghavan, Mr. Jayendra Shah and Mr. Uday Garg as its Members

Duringtheyearunderreview,four(4) meetingsoftheAuditCommitteewereheldon24thMay,2016,1stSeptember,2016, 5th November, 2016 and 21st February, 2017

NOMINATION and REMUNERATION COMMITTEE

TheNominationandRemunerationCommitteecomprisesofMr.KailashPershad asChairman,Mr.UdayGarg,Mr

Jayendra Shah and Mr. Samir Somaiya as its Members.

DuringtheyearunderreviewtheCommitteemetthriceon24thMay,2016,1stSeptember,2016and21stFebruary,

2017.

SHARE TRANSFER andALLOTMENT COMMITTEE (STAC)

STAC Committee was constituted by the Board in its meeting held on 9th February, 2016.

CurrentlytheSTACcomprisesofMrSamirSomaiyaasChairman,Mr.VinayV.Joshi,Mr.S.N.BableshwarandMr

Mohan Somanathan, as its Members

Duringtheyearunderreview,STAC meteleven(11)timeson9thApril,2015,12thJuly,2016,1stAugust,2016,24th

August,2016,5thOctober,2016,14thOctober,2016,25thNovember,2016,12thDecember,2016,29thDecember,

2016, 17th March, 2017 and 30th March, 2017.

WHISTLE BLOWER and VIGILMECHANISM

AsperSection177,Rule7oftheCompanies Act,2013acomprehensiveWhistleBlowerandVigilMechanismPolicy hasbeenapprovedandimplementedwithintheorganization.Thepolicyenablestheemployeesanddirectorstoreport instances of any unethical act or suspected incidents of fraud or violation of Companies Code of Conduct or ethics policy.This Policy (copy of which is uploaded on the website of the Company) safeguards whistleblowers from reprisals or victimization.

SHARE CAPITAL

The AuthorisedCapitalofyourCompanyis`60Crores dividedinto4,20,00,000(FourCroresTwentyLakhs) Equity Sharesof10/-eachand18,00,000(Eighteen Lakh)PreferenceSharesof `100/-each.On31stMarch,2017,the issued,subscribedandpaidupsharecapitalofyourCompanystoodat`36,95,23,470/-(ThirtySixCroresNinetyFive LakhsTwentyThreeThousandFourHundredandSeventy)comprising3,69,52,347(ThreeCroresSixtyNineLakhsFiftyTwoThousandThree Hundred and Forty Seven) Equity shares of`10/- each.

Duringtheyearunderreview,yourCompanyhadissued12,14,600(TwelveLakhsFourteenThousandSixHundred) Equity Shares of`10/- each on a preferential basis at a price of`190/- each.

DEPOSITS

Pursuant to Section 73 of the CompaniesAct, 2013 read with Rule 2 (e) of Companies (Acceptance of Deposits) Rules,

2014yourCompanyhasobtainedconsentofthememberstoacceptPublicDepositsatitsAnnualGeneralMeetingheld on30thSeptember,2016andstartedacceptingthedepositsafterduecomplianceoftheprovisionslaiddownintheAct.

CORPORATE SOCIALREPONSIBILITY

YourCompanyiscommittedtoconductitsbusinessinasociallyresponsible,ethicalandenvironmentalfriendlymanner and to continuously work towards improving quality of life of the communities in its operational areas.

Incompliancewiththerequirementsofsection135readwithScheduleVIIoftheCompaniesAct2013,theBoardhad constituted CSR Committee, which is responsible for fulfilling the CSR objectives of your company comprising of Mr. K.V. Raghavan as Chairman, Mr. Samir Somaiya and Mr. Paul Zorner as its members.

AdetailedreportonCorporateSocialResponsibilityactivitiesinitiatedbytheCompanyduringtheyearunderreview,in compliance with the requirements of CompaniesAct, 2013, is annexed to this report asAnnexure I.

RELATEDPARTYTRANSACTIONS

The Details of transactions entered into with the Related Parties is annexed to this report asAnnexure II.

CONSERVATION OF ENERGY, TECHNOLOGYABSORPTIONAND FOREIGN EXCHANGE EARNINGSAND OUTGO

Informationinaccordancewiththeprovisionsofsection134(3)(m)oftheCompaniesAct,2013,readwiththeCompanies (Accounts) Rules, 2014 regarding Conservation of Energy,TechnologyAbsorption and Foreign Exchange Earnings and Outgo is attached asAnnexure IIIto this report.

RESEARCHAND DEVELOPMENT

ResearchandDevelopmentcontinuestobeastrongbackboneforthecontinuousinnovationandbusinessplansofyour

Company. It focuses on the key areas of:

i) new process development exploring new value added products out of sugarcane biomass

ii)  continuous improvement in the existing processes for value creation and to achieve sustainable growth and iii) continuous improvement in the products quality as perceived by the customer

The detailed disclosure is annexed to this report asAnnexure III.

AUDITORS'REPORT

ThenotestoaccountsreferredtointheAuditors' Reportareselfexplanatoryand,therefore,donotcallforanyfurther comments.TheobservationsandcommentsgiveninthereportoftheAuditorsreadtogetherwithnotestoaccountsare self explanatory and hence do not call for any further information and explanation under Section 134 of the Companies Act, 2013.

AUDITORS

StatutoryAuditor:TheStatutory AuditorsM/sDesaiSaksenaand Associates,Chartered Accountants,Mumbai,having Firm Registration No 102358W, Holds office until the conclusion of the ensuing Annual General Meeting and are being eligible for appointment. Your company has received confirmation from the Auditors to the effect that their reappointment, if made, will be in accordance with the limits specified under Companies Act, 2013 and the firm satisfies the criteria specified in section 141 of the Companies Act, 2013 read with Rule 4 of Companies (Audit and Auditors) Rule 2014. The re-appointment proposed is within the time frame for transition as provided under the third proviso to sub-section (2) of section 139 of CompaniesAct 2013.

SecretarialAuditor:Duringtheyear,SecretarialAuditwascarriedoutbyMr.TusharShridharani,PractisingCompany

SecretaryhavingMembershipNo.FCS2690andCOPNo.2190incompliancewithsection204oftheCompaniesAct,

2013.

The report of the SecretarialAudit is annexed to this report asAnnexure IV.

CostAuditors:In terms of the section 148 of the CompaniesAct, 2013 read with Companies (Cost Records andAudit) Rules,2014,theCompanyhasappointedM/s.B.J.DNanabhoyandCo.,CostAccountantsastheCostAuditorsofthe Company having firm registration No. 000011 to conduct the Cost Audit for the financial year 2017-18. The Cost auditors has given a certificate to the effect that the appointment, if made, will be within the prescribed limits specified under Section141oftheCompaniesAct,2013.Furthertheremunerationpayabletothecostauditorisplacedbeforethe Members for their ratification.

RISK MANAGEMENT

The Board of Directors is overall responsible for identifying, evaluating and managing all significant risks faced by yourCompany.TheBoardhasapprovedRiskManagementPolicy,whichactsasanoverarchingstatementofintent andestablishestheguidingprinciplesbywhichkeyrisksaremanagedacrosstheorganization.TheBoardmonitors and reviews the implementation of various aspects of the Risk Management Policy through a duly constituted Risk Management Committee (RMC)

YourCompany'sriskmanagementpoliciesarebasedonthephilosophyofachievingsubstantialgrowthwhilemitigating and managing risks involved.

PREVENTION OF SEXUALHARASSMENTAT WORKPLACE

Your Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment ofWomenatWorkplace(Prevention,ProhibitionandRedressal)Act,2013andtheRulesthereunder.Duringtheyearunder review no complaint on sexual harassment was received.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of loans, guarantees and investments by your Company to other bodies corporate or persons are given in notes to the financial statements.

PARTICULARS OF EMPLOYEES

Thedisclosuresintermsoftheprovisionsofsection197ofthe ActreadwithRule5oftheCompanies(Appointment and Remuneration of Managerial Personnel) Rules, 2014 along with statement showing names and other particulars of the employees drawing remuneration in excess of the limits prescribed under the said rules is annexed to this report asAnnexureV.

EXTRACT OFANNUALRETURN

TheextractofAnnualReturninFormMGT-9asrequiredundersection92(3)oftheActreadwithCompanies(Management

andAdministration) Rules, 2014 is annexed to this report asAnnexure VI.

INTERNALFINANCIALCONTROLS and ITSADEQUACY

Your Company has put in place an adequate system of internal financial controls commensurate with its size and nature of the business which helps in ensuring he orderly and efficient conduct of its business. These systems provide a reasonable assurance in respect of providing financial and operation information, complying with applicable statutes, safeguarding ofassetsoftheCompany,preventionanddetectionoffrauds,accuracyandcompletenessofaccountingrecordsand ensuringcompliancewithcorporatepolicies.Asameanstofurtherstrengthenthecontrolenvironment,duringtheyear, theprocesseswerebenchmarkedwithindustrypracticestoidentifythegaps,ifany,andremedialmeasuresweretaken.

TheAudit Committee reviews adherence to internal control systems and internal audit reports.

ACKNOWLEDGEMENTS

The Directors wish to place on record their appreciation for the continued support and co-operation by the Government Authorities,Banks,FinancialInstitutions,MinistryofCorporateAffairs,ReserveBankofIndia,SecuritiesandExchange BoardofIndia,theStockExchangesandDepositories,SugarcaneGrowersAssociation,Suppliers,Customers,Investors and finally to all its members for the trust and confidence reposed on the Company. 

The Board further wishes to record its sincere appreciation for the significant contributions made by employees at all levels for their competence, dedication and contribution towards the operations of the Company.

Your Directors also acknowledge the support extended by the employees with their dedicated service and contribution to the Company.

For and on behalf of the Board of Directors sd/-

Samir S. Somaiya

Date : 30th May, 2017   Chairman and Managing Director

Place : Mumbai  DIN -00295458

ANNEXURE I

Annual Report on Corporate Social Responsibility

(Pursuant to section 135 of theAct and Rules made thereunder)

A brief outline of your Company's CSR Policy including overview of projects or programs proposed to be undertaken and a reference to the weblink to the CSR policy and projects or programs:

Pursuanttosection135oftheCompaniesAct,2013,theCorporateSocialResponsibilityCommitteeoftheBoardhad approved a CSR Policy with primary focus on Education, Healthcare, Gender Equality andWomen Empowerment.

�  Composition of the CSR Committee:

1.  Mr. K.V. Raghavan, Chairman

2.  Mr. Paul Zorner, Member

3.  Mr. Samir Somaiya, Member

�  Salient features of Corporate Social Responsibility (CSR) Policy:

YourCompanyundertakesCSRactivitiesonfounder'sphilosophy"Whatwereceivegivesbackmultifold"initsarea ofCompany'soperationsinKarnatakaandMaharashtra.TheprominentfocusisonpromotionofEducation,Healthcare, Gender equality and empowering women, providing safe drinking water and environmental sustainability.

�  Average Net Profit / (Loss) before Tax for your Company for last three financial years : NA

�  Prescribed CSR Expenditure (two per cent of the amount as mentioned above): NA

�  Details of CSR spent for the financial year :

1.  Total amount spent for the financial year -`1,62,53,253

2.  Amount unspent, if any. - NIL

3.  Areas where spent -The manner in which the amount is spent is detailed in partAto the annexure.

A. CSR Expenditure for 2016-17:

ANNEXURE II

Details of contracts or arrangements or transactions atArm's Length Basis

(`in Lakhs)

(`in Lakhs)

(`in Lakhs)