Professional Documents
Culture Documents
Simbhaoli Sugars LTD.: Stakeholders Empowerment Services
Simbhaoli Sugars LTD.: Stakeholders Empowerment Services
Simbhaoli Sugars LTD.: Stakeholders Empowerment Services
Surveillance Actions: There was no surveillance action on the Company as on date of this Report i.e. 23rd February, 2019.
400 Quarterly revenue and Profit (₹ CRORE) The revenue of the Company increased from ₹ 63.91 crores to ₹
297.46 160.69 crores from quarter ending Sep’17 to quarter ending
300 Sep’18. The Company made a loss of ₹ 0.21 crores in quarter
200 160.69 ending Sep’18 vis-a-vis making a loss of ₹ 34.10 crores in quarter
ending Sep’17.
100 63.91
-0.21
-33.21 -34.10
0
-100
Sep'18 Mar'18 Sep'17
Revenue Profit
Source: Moneycontrol
1.25
TABLE 2- Returns
1-m 3-m 6-m 12-m
1.00
Simbhaoli Sugars Ltd -14.78% -27.92% -8.95% -41.36%
0.75
Nifty -0.54% 0.99% -7.70% 3.19%
0.50 Nifty FMCG -2.65% -2.25% -10.31% 10.38%
0.25 Source - Capitaline/NSE
Feb 18 Apr 18 Jun 18 Aug 18 Oct 18 Dec 18 Feb 19
Simbhaoli Sugars Ltd NIFTY NIFTY FMCG
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 1|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
Discussion by the Company in quarterly results: In the notes of financial statement for the quarter and half year ended 30th
September, 2018 it is stated that “For the quarter and six months' period ended September 30, 2018 and previous periods, the
Company has incurred losses before interest. The losses were mainly attributable to high raw material cost being fixed by the
Government, and relatively market driven lower price of finished goods i.e. sugar and molasses both of which are external
factors. Due to losses, the company failed in meeting its payment obligations to lenders and also to the farmers towards the
timely payment of cane price, though the Company continues to operate its capacities at optimal levels. The debt restructuring
exercise of the loan liabilities of the Company has been discontinued by the lenders in view of the change in policy framework and
the lenders to the Company have taken recovery steps including loan recalls. However, Hon'ble supreme Court stayed the
implementation of such changed framework for certain sectors including Sugar. The application moved by a lender before the
Hon'ble NCLT Allahabad bench, has been stayed by the Hon'ble Supreme Court. The Company expects that considering the nature
of industry and ongoing discussions with the lenders, its loans liabilities would be realigned commensurate with its available cash
flow.
Meanwhile, the Government has implemented various measures to improve the financial health of the sugar industry. Further
pursuant to a favorable Order of Hon'ble High Court of Uttar Pradesh, the Company is also confident to receive substantial
amount on account of accrued benefits under the Sugar Promotion Policy 2004. In view of the above, these financial statements
are continued to be presented on going concern basis, which contemplates realisation of assets and settlement of liabilities in the
normal course of business.”
AUDIT QUALIFICATIONS
Audit Qualifications in last 3 years: The Statutory Auditors have made qualifications in their Report for FY 2017-18. No
qualifications were made for FY 2015-16 and FY 2016-17.
Qualifications in FY 2017-18: -
STANDALONE
Basis for Qualified Opinion: “1. As stated in Note No.10 to the standalone financial statement, no provision has been made in
respect of interest accrued and due but not paid by the company on certain loans aggregating to Rs. 11,971.59 Lacs for the
reasons stated in the said note. Consequently, loss for the year and ‘current-other financial liabilities’ has been understated and
‘other equity’ has been overstated by Rs. 11,971.59 Lacs. Our report is qualified for the above matters.”
Qualified Opinion: “In our opinion and to the best of our information and according to the explanations given to us, except for
the effects of the matter described in the Basis for Qualified Opinion paragraph above, the aforesaid standalone Ind AS financial
statements give the information required by the Act in the manner so required and give a true and fair view in conformity with
the accounting principles generally accepted in India including the Ind AS, of the state of affairs (financial position) of the
Company as at March 31, 2018, and its loss (financial performance including other comprehensive income), its cash flows and the
changes in equity for the year ended on that date.”
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 2|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
Basis for Adverse Opinion: “As explained in Note No. 1, these consolidated financial statements have been prepared without
consolidation of financials of one subsidiary viz Simbhaoli Power Private Limited (SPPL) because the Ind AS compliant financial
statements of the subsidiary company are under compilation. This acquisition is, therefore, accounted for as investment in the
consolidated financial statements. Under the accounting principles generally accepted in India, the subsidiary should have been
consolidated because it is controlled by the Company. Had the company been consolidated, many elements in the accompanying
financial statements would have been materially affected. The effects on the financial statements due to the failure to
consolidate have not been determined.”
Adverse Opinion: “In our opinion, because of the non-compilation of financial statement of one of its subsidiary in the
consolidated financial statements as mentioned in the Basis for Adverse Opinion paragraph, the consolidated financial
statements do not give the information required by the Companies Act, 2013 in the manner so required and also do not give a
true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the
consolidated state of affairs of the Group as at March 31, 2018, of their consolidated losses including other comprehensive
income and their consolidated cash flows and consolidated statement of changes in equity for the year ended on that date.”
Management Response: “The comments on the statement of accounts referred to in the report of the auditors are self-
explanatory, and explained in the appropriate notes to accounts, the details of which are mentioned elsewhere in this report.”
Response Comment
Frequency of Qualifications in last 3 years? No Qualification in FY 2017-18 only in last 3 FY’s
Have the auditors made any adverse remark in last 3 years? Yes In FY 2017-18 (As detailed above).
Composition of Board: The Board of the Company comprises of 9 Directors which includes 4 Independent Directors. As per
Regulation 17(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company should have
at least 50% Independent Directors as the Chairman of the Board is a Promoter Director. The Company has 44% of Independent
Directors and hence, it does not meet the regulatory requirements.
Board Diversity: The Company has 9 directors out of which 1 is Woman Director.
Attendance at Board Meetings: During the FY 2017-18, the average attendance of Directors in the Board meetings was 82.81%.
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 3|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
Total Liabilities to Totals Asset Ratio 0.95 0.96 0.89 -0.18% 7.25%
Retained Earnings to Totals Assets Ratio* N.A. -0.20 N.A. N.A. N.A.
Long Term Debt to Total Asset Ratio 0.00 0.17 0.12 -97.53% 43.78%
Interest Coverage Ratio 1.68 N.A. 0.21 N.A. N.A.
Market Cap / Sales 0.33 0.19 1.67 78.22% -88.88%
Trading
Ratios
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 4|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 5|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
Fixed Assets: assets which are purchased for long-term use and are not likely to be converted quickly into cash, such as land,
buildings, and equipment
Total Assets: Current Assets + Fixed Assets
Investments: An investment is an asset or item that is purchased with the hope that it will generate income or appreciate in
the future.
Finance Cost: The Financing Cost (FC), also known as the Cost of Finances (COF), is the cost and interest and other charges
incurred during the year in relation to borrowed money.
Long Term Liabilities: Long-term liabilities are liabilities with a maturity period of over one year.
Current Liabilities: A company's debts or obligations that are due within one year.
Inventory Turnover ratio: Inventory Turnover is a ratio showing how many times a company's inventory is sold and replaced
over a period.
Sales Turnover
𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =
Inventory
Debtors Turnover: Accounts receivable turnover is an efficiency ratio or activity ratio that measures how many times a business
can turn its accounts receivable into cash during a period
Sales Turnover
𝐷𝑒𝑏𝑡𝑜𝑟𝑠 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =
Accounts recievables
Fixed Asset Turnover: The fixed-asset turnover ratio is a financial ratio of net sales to fixed assets
Sales Turnover
𝐹𝑖𝑥𝑒𝑑 𝐴𝑠𝑠𝑒𝑡 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =
Fixed Assets
Current Asset Turnover: The current-asset turnover ratio is a financial ratio of net sales to fixed assets
Sales Turnover
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝐴𝑠𝑠𝑒𝑡 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 𝑟𝑎𝑡𝑖𝑜 =
Current Assets
Operating Profit Margin: Operating margin is a measurement of what proportion of a Company’s revenue is left over after
paying for variable costs of production such as wages, raw materials etc. It can be calculated by dividing a Company’s operating
income (also known as “operating profit”) during a given period by its sales during the same period.
Operating profit
𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑃𝑟𝑜𝑓𝑖𝑡 𝑀𝑎𝑟𝑔𝑖𝑛 =
Sales Turnover
Net Profit Margin: Net profit margin is the percentage of revenue left after all expenses have been deducted from sales
Net profit
𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡 𝑀𝑎𝑟𝑔𝑖𝑛 =
Sales Turnover
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 6|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 7|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝑆𝑎𝑙𝑒𝑠 𝑟𝑎𝑡𝑖𝑜 =
𝑆𝑎𝑙𝑒𝑠 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟
Market Cap/ Net Worth ratio: It is a valuation ratio calculated by dividing Company’s market cap to net worth.
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝑁𝑒𝑡𝑤𝑜𝑟𝑡ℎ 𝑟𝑎𝑡𝑖𝑜 =
𝑁𝑒𝑡𝑤𝑜𝑟𝑡ℎ
Market Cap/ PAT ratio: It is a valuation ratio calculated by dividing Company’s market cap to net profit.
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝑃𝐴𝑇 𝑟𝑎𝑡𝑖𝑜 =
𝑛𝑒𝑡 𝑝𝑟𝑜𝑓𝑖𝑡
Market Cap/ EBITDA ratio: It is a valuation ratio calculated by dividing Company’s market cap to EBITDA.
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝
𝑀𝑎𝑟𝑘𝑒𝑡 𝐶𝑎𝑝/𝐸𝐵𝐼𝑇𝐷𝐴 𝑟𝑎𝑡𝑖𝑜 =
𝐸𝐵𝐼𝑇𝐷𝐴
Trading Volume (shares) (avg. of 1 year): Average number of shares/day traded in 1 year
Trading volume (shares) (high in 1 year): Highest number of shares/day traded in 1 year
Trading volume (shares) (minimum in 1 year): Lowest number of shares traded on any one day in 1 year
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 8|P AGE
STAKEHOLDERS EMPOWERMENT SERVICES SIMBHAOLI SUGARS LTD.
Analyst Certification
The analysts involved in development of this factsheet certify that no part of SEBI Reg. No. INH000000016
any of the research analyst’s compensation was, is, or will be directly or
indirectly related to the contents of this factsheet. This factsheet or any portion hereof may not
be reprinted, sold, reproduced or
Disclaimer redistributed without the written consent of
Stakeholders Empowerment Services
This Report has been made by SES as a paid service for which consideration has
been paid by NSE.
Contact Information
While SES has made every effort and has exercised due skill, care and diligence
in compiling this factsheet based on publicly available information, it neither Stakeholders Empowerment Services
guarantees its accuracy, completeness or usefulness, nor assumes any liability A 202, Muktangan,
whatsoever for any consequence from its use. This factsheet does not have Upper Govind Nagar,
any approval, express or implied, from any authority, nor is it required to have Malad East,
such approval. The users are strongly advised to exercise due diligence while Mumbai – 400 097
Tel +91 22 4022 0322
using this factsheet.
Stakeholders’ Education | Corporate Governance Research | Corporate Governance Score | Proxy Advisory 9|P AGE