• Managing director’s message

Managing director’s message

Dwarikesh sugar industries limited reported a 51% increase in revenues and a 307% growth in profit after tax in 2016-17. This sharply divergent profitable growth validates what we always believed: that our company would be the last man standing during a sectoral trough and the first to rebound following industry recovery. EPS for FY 17 was ₹ 88.36 vis-à-vis ₹ 22.02 in FY 16. CEPS for FY 17 was 135.08 compared to ₹ 41.08 during FY 16.

Dear Shareholders,

There have been a number of reasons why our company never reported cash losses even during the most challenging sectoral tenures of the last few years.

Passion at work

Primarily, we worked with a deeper passion than most; this made it possible to generate an incremental gain over the sectoral average; when you aggregate the improvements (whether in-plant availability or the speed with which we brought in the cane for onward crushing, or the way we maintained the road network within our command area to smoothen logistics), the result was that we generated a recovery that was usually among the highest in Uttar Pradesh.

Precious learnings

In addition to these standing rules, we added some precious learnings derived from the last sectoral slowdown.

One, we will never leverage our balance sheet in the agri-commodity business where price swings can occasionally be so severe that only companies that have less debt on their books would be able to survive.

Taking our business ahead

At Dwarikesh, we are at an attractive point in our existence.

We made a qualified institutional placement of 2,515,471 equity shares at ₹ 236.11 each, mobilising an aggregate ₹ 59.39 crores. We used this mobilisation in accelerated repayment of our debt. Following this net worth infusion and accruals generated from 2016-17, the company’s debt-equity ratio has strengthened from 2.58 as at 31.03.2016 to 0.46 as at 31.03.2017.

Thank You
Gautam R. Morarka
Managing Director