Notes to Accounts of Sakthi Sugars Ltd.

Mar 31, 2018

Rights, preferences and restrictions of each class of shares

The Company has only one class of equity shares having a face value of Rs.10 each. Each shareholder is eligible for one vote per share held. Dividend is payable when it is recommended by the Board of Directors and approved by the Members at the Annual General Meeting. In the event of liquidation, the equity shareholders will get the remaining assets of the Company after payment of all the preferential amounts.

A) unsecured loan from banks

Term Loans amounting to Rs. Nil (March 31, 2017 : Rs.Nil and April 1, 2016: Rs.625.10 lakhs)

B) secured loans from banks

1 Working capital loan amounting to Rs.297 lakhs (March 31,2017 : Rs. 297 lakhs and April 1,2016 : Rs.297 lakhs) is secured by the fixed deposit amounting to Rs.330 lakhs held with them.

2 Working capital loans amounting to Rs.Nil (March 31, 2017 : Nil and April 1, 2016: Rs.1675.08 lakhs) is secured by

a. Pari passu first charge by way of hypothecation of the current assets of the Company, except TANGEDCO receivables.

b. Pari passu second charge on the entire movable and immovable properties of the Company, except Sugar and Co-generation Units in Sivaganga and Modakuruchi and other exclusively charged assets.

3 Working capital loan (bills discounting facility) amounting to Rs.Nil (March 31, 2017 : Nil and April 1,2016 : Rs.3617.92 lakhs) is secured by

a. Exclusive charge on receivables from TANGEDCO against supply of power from cogeneration plants at Sakthinagar, Sivaganga and Modakurichi.

b. Pari passu first charge on the Company’s corporate office building at Coimbatore

4 Working capital loan amounting to Rs.Nil (March 31,2017 : Rs. Nil and April 1, 2016: Rs.185.97 lakhs) is secured by

a. Pari passu first charge on the current assets of sugar division (except Modakuruchi), distillery and soya units.

b. Pari passu second charge on the immovable & movable assets of the Company’s Sakthinagar distillery unit, Dhenkanal sugar and distillery units and soya units.

5 The loan under 2 above is further secured by pledge of shares held by promoters in the Company.

6 Guarantees given by Directors:

a. Working capital loans amounting to Rs.Nil (March 31, 2017 : Rs. Nil and April 1, 2016 : Rs.5293 lakhs) are guaranteed by Dr. M.Manickam, Sri. M. Balasubramaniam and Sri. M. Srinivaasan.

b. Working capital loan amounting to Rs.Nil (March 31,2017 : Nil and April 1,2016 : Rs.185.97 lakhs) is guaranteed by Dr. M.Manickam.

Asset Reconstruction Company (India) Limited (ARCIL), which had acquired the loan portfolios in respect of the Company from Canara Bank, State Bank of India, HDFC, IOB and IDBI, vide their letter dated 22nd April 2016 restructured the exposures granting remission of liability of Rs.101.74 crores. The same is disclosed under “Exceptional Items” in the Statement of Profit and Loss relating to the previous financial year.

Edelweiss Asset Reconstruction Company Limited (Edelweiss), which had acquired the loan portfolios from IDFC and OBC, vide their letter dated 11th February 2016 restructured the exposures granting remission of liability of Rs.22.49 crores. However, due to delay in servicing of the loans, they have revoked the remission granted earlier. The same is disclosed under “Exceptional Items” in the Statement of Profit and Loss for the financial year ended 31.3.2018.

1 ASSETS Classified AS Held For SALE

The Company intends to dispose off, certain non-core assets (Land and Building) it no longer requires, in the next 12 months. A search for buyers is underway and no impairment loss is recognised as the fair value (estimated based on market price) less costs to sell is higher than the carrying amount.

Investment amounting to Rs.15157.86 Lakhs in the associate company (SACL) has been reclassified under ‘held for sale’. On reclassification the related investment has been measured at lower of carrying amout and fair value less cost to sell.

2.1 The sugarcane price for crushing season 2013-14 notified by the State Government over and above FRP announced by the Central Government is disputed and the writ petition filed by the Association in High Court is pending for disposal. The differential price on this account is Rs.9851.62 lakhs for the seasons from 2013-14 to 2017-18 (Upto 31st March 2018).

3 GOING concern Assumptions

The financial statement of the Company has been prepared on going concern basis as in the opinion of the Board of Directors at the time of their approval, there is a reasonable expectation that the Company will continue its operations for a foreseeable future. The Directors have examined the following points in order to ascertain the validity of going concern assumption.

a) The Company has incurred a loss before tax of Rs. 25220.38 lakhs during the financial year ended March 31, 2018 against a profit before tax of Rs. 4315.15 lakhs for the previous year ended March 31, 2017 and as on 31st March 2018 the Company’s accumulated losses amounted to Rs. 16183.79 lakhs. Further as at the end of the financial year under review, Company’s current liabilities exceed the current assets by Rs. 62907.43 lakhs.

b) The Company has defaulted in repayment of its dues to financial institutions and banks of an amount of Rs. 17738.10 lakhs towards principal and Rs. 20632.51 lakhs towards interest.

The Company has initiated steps for disposal of certain Investments and non-core assets, restructuring of dues to lenders/ creditors, rationalization of operation, etc. Taking into consideration of the steps initiated, your directors have prepared the financial statements of the Company on going concern basis.

4 investment in associate

These Financial statements are separate financial statements prepared in accordance with Ind AS-27 Separate Financial Statement.

The Company’s investment in Associate is as under:

5 Disclosure under the Micro, Small and Medium Enterprises Development Act, 2006 are provided as under for the year 2017-18, to the extent the Company has received intimation from the “Suppliers” regarding their status under the Act.

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

6 A. DISCLOSuRE AS pER REGuLATION 34(3) OF SEBI (LISTING OBLIGATIONS AND DISCLOSuRE REQuiREMENTS)

regulations

Loans and advances in the nature of loans given to subsidiaries, associates and others and investment in shares of the Company by such parties:

The above loan was given to the associate for its business activities (Refer Note 50). Figures in bracket refer to amount as at 1st April, 2017.

B. disclosure AS per SECTION 186 OF THE COMpANIES ACT, 2013

The Company has not given any loan, guarantee or made any investment under Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 during the Financial year ended 31.03.2018.

7 EMpLOYEE BENEFITS

A. Defined contribution plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs.307.52 Lakhs (year ended March 31, 2017: Rs.327.52 lakhs) for Provident Fund contributions, Rs.46.85 Lakhs (year ended March 31, 2017: Rs.31.36 lakhs) for Superannuation Fund contributions and Rs.12.73 Lakhs (year ended March 31, 2017: Rs.8.94 lakhs) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss for the financial year ended 31st March 2018. The contributions payable to these plans by the Company are at rates specified in the rules of the Schemes.

B. Defined benefit plans : Gratuity

In respect of Gratuity plan, the most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out as at March 31, 2018 by Mr.Srinivasan Nagasubramanian, Fellow of the Institute of Actuaries of India. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit cost method. The following table sets forth the status of the Gratuity Plan of the Company and the amount recognised in the Balance Sheet and Statement of Profit and Loss. The Company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC).

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).

Investment risk : The probability or likelihood of occurrence of losses relate to the expected return on any particular investment.

salary escalation risk : The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. 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. Demographic risk : The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

The Company has invested the plan assets with the insurer managed funds. The insurance company has invested the plan assets in Government Securities, Debt Funds, Equity shares, Mutual Funds, Money Market Instruments and Time Deposits. The expected rate of return on plan asset is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation.

Significant actuarial assumptions for the determination of the defined benefit obligation are discount rate, expected salary increase and mortality. The sensitivity analysis below have been determined based on reasonably possible changes of the assumptions occurring at the end of the reporting period, while holding all other assumptions constant. The results of sensitivity analysis is given below:

Sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.

There was no change in the methods of assumptions used in preparing the sensitivity analysis from prior years.

The Company has purchased insurance policy, which is basically a year-on-year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The insurance Company, as part of the policy rules, makes payment of all gratuity outgoes happening during the year (subject to sufficiency of funds under the policy). The policy, thus, mitigates the liquidity risk. However, being a cash accumulation plan, the duration of assets is shorter compared to the duration of liabilities. Thus, the Company is exposed to movement in interest rate (in particular, the significant fall in interest rates, which should result in increase in liability without corresponding increase in the asset)

C. Note on provident Fund:

With respect to employees, who are covered under Provident Fund Trust administered by the Company, the Company shall make good deficiency, if any, in the interest rate declared by Trust over statutory limit. Having regard to the assets of the Fund and the return on the investments, the Company does not expect any deficiency in the foreseeable future.

D. Long Term Compensated Absence

The assumption used for computing the long term accumulated compensated absences on actuarial basis are as follows.

The weighted average number of equity shares for the purposes of diluted earnings per share reconciles to the weighted average number of equity shares used in the calculation of basic earnings per share as follows:

8 FINANCIAL INSTRUMENT

8.1 Capital Management

The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance.

The capital structure of the Company consists of net debt and total equity of the Company.

8.2 Gearing Ratio

The gearing ratio at the end of the reporting period was as follows.

8.3 Fair Value Measurements

The following table provides the fair value measurement hierarchy of the Company’s Financial Asstes and Liabilities:

8.4.1 Quoted prices in an active market (Level 1):

This level of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities. This category consists of investment in quoted equity shares, and mutual fund investments.

8.4.2 Valuation techniques with observable inputs (Level 2):

This level of hierarchy includes financial assets and liabilities, measured using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). This level of hierarchy includes Company’s over-the-counter (OTC) derivative contracts.

8.4.3 Valuation techniques with significant unobservable inputs (Level 3):

Valuation techniques with significant unobservable inputs (Level 3): This level of hierarchy includes financial assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.

8.4.7 Financial Instrument measured at Amortised Cost:

The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.

8.5 Financial Risk Management Objectives

The Company’s corporate finance department provides services to business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyse the exposures by degree and magnitude of risks. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Company seeks to minimize the effects of these risks by using derivative financial instruments to hedge risk exposures. The use of financial derivatives is governed by the Company’s policies approved by the Board of Directors, which provide written principles on foreign exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the Management and the internal auditors on a continuous basis. The Company does not enter into or trade financial instruments, including derivatives for speculative purposes.

The corporate treasury function reports quarterly to the Company’s risk management committee, an independent body that monitors risks and policies implemented to mitigate risk exposures.

8.5.1 Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risks: interest rate risk, currency risk and other price risk. Financial instruments affected by market risk includes borrowings, investments, trade payables, trade receivables, loans and derivative financial instruments.

8.5.2 Foreign Currency Exchange Rate Risk

The fluctuation in foreign currency exchange rates may have potential impact on the income statement and equity, where any transaction references more than one currency. The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks.

8.5.3 Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers and investment securities. Credit risk arises from cash held with banks and financial institutions, as well as credit exposure to clients, including outstanding accounts receivable. The maximum exposure to credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.

8.5.4 Credit Risk Management

The Company does not have significant credit risk exposure to any single counterparty. Concentration of credit risk related to the above mentioned company did not exceed 10% of gross monetary assets at any time during the year. Concentration of credit risk to any other counterparty did not exceed 10% of gross monetary assets at any time during the year.

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment.

8.5.5 Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk through credit limits with banks.

The Company’s corporate treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management.

8.5.6 Foreign Currency Sensitivity Analysis

The Company is mainly exposed to the currency USD on account of outstanding trade receivables, trade payables and FCCB in USD.

The following table details the Company’s sensitivity to a 5% increase and decrease in INR against the USD. 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an increase in profit or equity where the INR strengthens 5% against the relevant currency. For a 5% weakening of the INR against the relevant currency, there would be a comparable impact on the profit or equity, and the balances below would be negative.

8.5.7 Interest Rate Risk

Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rates. Any movement in the reference rates could have an impact on the Company’s cash flows as well as costs. The Company is subject to variable interest rates on some of its interest bearing liabilities. The Company’s interest rate exposure is mainly related to debt obligations.

8.5.8 Interest Rate Sensitivity Analysis

If interest rates had been 1% higher and all other variables were held constant, the company’s profit for the year ended would have impacted in the following manner:

9 information ON RELATED party TRANSACTIONS AS required BY Ind AS- 24 - ‘RELATED pARTY DISCLOSuRES’ FOR THE YEAR ENDED 31.03.2018.

9.1 Name of Related parties and nature of relationship:

Holding Company ABT Investments (India) Pvt Ltd

Associates Sakthi Auto Component Limited

Sakthi Finance Limited

Sri Chamundeswari Sugars Limited

Key Management Personnel (KMP) Executive Directors:-

Sri M Manickam, Executive Chairman Sri M Balasubramanian, Managing Director Sri M Srinivaasan, Joint Managing Director Sri V K Swaminathan, Executive Director

Non-Executive Directors:-

Sri N K Vijayan, Independent Director

Sri S S Muthuvelappan, Independent Director

Sri P K Chandran, Independent Director

Sri S Chandrasekar, Independent Director

Sri S Balasubramanian, Independent Director

Sri K V Ramachandran, Independent Director

Smt Priya Bhansali, Independent Director

Sri Jigar Dalal, Independent Director

Executive Officer:-

Sri S Baskar, Chief Financial Officer & Company Secretary

Relatives of KMP There have been no transactions with relatives of Key Management Personnel.

Other entities over which there is a significant influence ABT Limited

ABT (Madras) Pvt Ltd

ABT Industries Limited

ABT Info Systems Pvt.Limited

ABT Foods Limited

ABT (Madurai) Pvt Ltd

ABT Two Wheelers Pvt Ltd

Anamallais Bus Transport Pvt. Limited

The Anamallais Retreading Company Pvt Ltd

Chamundeswari Enterprises Pvt Ltd

Nachimuthu Industrial Association

Sakthi Coffee Estates (P) Ltd.

ABT Textiles (P) Ltd Anamallais Retreading Corporation N.Mahalingam & Company Sakthi Automobiles The Gounder & Co.

Note : Related party relations are as identified by the management and relied upon by the auditors

10 segment reporting Basis of segmentation:

Factors used to identify the reportable segments:

The Company has following business segments, which are its reportable segments. These segments offer different products and services, and are managed separately because they require different technology and production processes. Operating segment disclosures are consistent with the information provided to and reviewed by the chief operating decision maker.

Revenue and expenses directly attributable to segments are reported under each reportable segment. Other expenses and income which are not attributable or allocable to segments have been disclosed as net un-allocable expenses/income.

Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as un-allocable.

Inter segment Transfer pricing:

Inter segment prices are normally negotiated amongst the segments with reference to cost, market prices and business risks, within an overall optimisation objective for the enterprise.

10.1 Non-current assets of the Company except Rs.5302.26 Lakhs are located in India.

10.2 There is no transactions with single external customer which amounts to 10% or more of the Company’s revenue.

11 FIRsT TIME ADOpTION OF INDIAN ACCOuNTING sTANDARDs (Ind As)

For all periods up to and including the year ended 31st March, 2016, the Company had prepared its financial statements in accordance with the accounting standards notified under Section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 (‘Previous GAAP’). This note explains the principal adjustments made by the Company in restating its financial statements prepared under Previous GAAP for the following

a) Balance Sheet as at 1st April, 2016 (Transition date);

b) Balance Sheet as at 31st March, 2017;

c) Statement of Profit and Loss for the year ended 31st March, 2017; and

d) Statement of Cash flows for the year ended 31st March, 2017.

11.1 FOOT NOTE:-

a. property, plant and Equipment

The Company has elected to measure items of Property, Plant and Equipment (PPE) at fair value at the date of transition to Ind AS and considered it as deemed cost. Hence, at the date of transition to Ind AS, an increase of Rs.36642.32 Lakhs (Including Impairment of Capital WIP of Rs.10359.92 Lakhs) was recognised in Property, Plant and Equipment with corresponding increase in Retained Earnings. An increase of Rs.37290.50 Lakhs in PPE has been recognized as at 31.3.2017.

Since the Company has elected for fair valuation of PPE at the date of transition to Ind AS, the Revaluation Reserve existing on the date of transition under Previous GAAP amounting to Rs.37538.64 Lakhs has been transferred on the date of transition and Rs.35719.14 lakhs has been transferred, as at 31.03.2017, to the Retained Earnings.

b. Intangible Assets:

The carrying amount of intangible asset under previous GAAP of Rs.8400.46 Lakhs has been de-recognised on transition to Ind AS since no future economic benefits are expected from its use or disposal. The loss arising from such de-recognition has been transferred to the Retained Earnings on the date of transition.

The carrying amount of intangible asset under previous GAAP as at 31.03.2017 of Rs.5795.34 Lakhs (Rs.2605.13 Lakhs had been written off under previous GAAP and reduced from Depreciation and amortization expenses in statement of Profit and Loss) has been de-recognised under Ind AS.

c. Non-Current Investments:

In the financial statements prepared under Previous GAAP, Non-current Investments of the Company were measured at cost less provision for diminution (other than temporary). Under Ind AS, the Company has recognised such investments as follows:

- Government securities - At amortised cost

- Equity shares of associate company - At cost

- Quoted equity shares - At FVTPL by an irrevocable election

- Unquoted equity shares - At cost

On the date of transition to Ind AS, the difference between the fair value of Non-Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs.86.25 Lakhs which has been recognised directly in retained earnings.

As at 31st March, 2017, the difference between the fair value of Non-Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs.96.59 Lakhs. On such fair valuation, net gain amounting to Rs.10.32 Lakhs has been recognised in other income in the Statement of Profit and Loss.

d. Trade Receivable, Trade payables & Other Financial Liabilities:

In the financial statements prepared under Previous GAAP, the company had opted to recognize foreign exchange fluctuation based on settlement of obligations.

In terms of requirement of Ind AS- 21 the effects of changes in foreign exchange rates, foreign currency monetary items of the Company are translated at the closing exchange rates which has resulted in increase of Rs.3271.74 Lakhs in Trade receivable and increase of Rs.1537.43 Lakhs in Other financial liability respectively and net gain of Rs.1734.31 lakhs has been transferred to the Retained Earnings on the date of transition.

Foreign currency monetary items of the Company are translated at the closing exchange rates as at 31.03.2017 which has resulted in net increase of Rs.1245.15 Lakhs in Trade receivable, Rs.0.21 Lakhs in Trade payable and Rs.396.17 Lakhs in Other financial liabilities respectively and net gain of Rs.848.77 lakhs has been transferred to the Statement of Profit and loss.

e. Inventories:

Due to Change in Fair value of inventories as at 31.03.2017 the value has been increased by Rs.0.80 Lakhs with a corresponding transfer to Retained earnings as on that date.

f. Current Investments:

In the financial statements prepared under Previous GAAP, Current Investments of the Company were measured at lower of cost and market value. Under Ind AS, these investments have been classified as FVTPL on the date of transition. The fair value changes are recognized in the Statement of Profit and Loss.

On the date of transition to Ind AS, the difference between the fair value of Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs.1372.00 Lakhs, which has been recognized directly in retained earnings.

As at 31st March, 2017, the difference between the fair value of Current Investments as per Ind AS and their corresponding carrying amount as per financial statements prepared under Previous GAAP, has resulted in an increase in the carrying amount of these investments by Rs.2610.60 Lakhs.

Fair valuation gain for the year ended 31st March, 2017, amounted to Rs.1248.92 Lakhs and the same has been recognized in other income in Statement of Profit and Loss.

The above transition has impacted an increase in equity by Rs.1372.00 Lakhs as at transition date and by Rs.2610.60 Lakhs as at 31st March, 2017.

g. Other Equity:

Retained earnings as at April 01, 2016 has been adjusted consequent to the above Ind AS transition adjustments.

h. Revenue from sale of products

In the financial statements prepared under Previous GAAP, revenue from sale of products was presented net of excise duty. However, under Ind AS, revenue from sale of products includes excise duty. Excise duty expense amounting to Rs.1259.50 Lakhs is presented separately on the face of the Statement of Profit and Loss for the year ended 31st March, 2017.

In the financial statements prepared under Previous GAAP, cash discount and sales promotional expenses were shown as a part of other expenses. However, under Ind AS, such discounts and sales promotional expenses amounting to Rs.47.90 Lakhs for the year ended 31st March, 2017, are reduced from revenue from sale of products.

In light of the above, revenue from sale of products under Ind AS has increased by Rs.1211.60 Lakhs (Rs.1259.50 Lakhs less Rs.47.90 Lakhs) with an corresponding increase in excise duty by Rs.1259.50 Lakhs, decrease in other expenses by Rs.47.90 Lakhs in the Statement of Profit and Loss for the year ended 31st March, 2017.

The above changes do not affect equity as at date of transition to Ind AS, profit after tax for the year ended 31st March, 2017 and Equity as at 31st March, 2017.

i. Employee benefits

i) Remeasurement of defined benefit plans

In the financial statements prepared under Previous GAAP, remeasurement benefit of defined plans (gratuity), arising primarily due to change in actuarial assumptions was recognised as employee benefits expense in the Statement of Profit and Loss. Under Ind AS, such remeasurement benefits relating to defined benefit plans is recognised in OCI as per the requirements of Ind AS 19 Employee benefits. Consequently, the related tax effect of the same has also been recognised in OCI.

For the year ended 31st March, 2017, remeasurement of gratuity liability resulted in a net benefit of Rs.258.45 Lakhs which has now been removed from employee benefits expense in the Statement of Profit and Loss and recognised separately in OCI. This has resulted in decrease in employee benefits expense by Rs.258.45 Lakhs and expenses in OCI by Rs.258.45 Lakhs for the year ended 31st March, 2017.

ii) Other Employee benefits:

Loans to employees are financial assets and should be recorded at fair value on initial recognition. Fair value can be estimated as the present value of the future cash flows, discounted at a market rate for a similar loan. The loan asset is subsequently accounted for in accordance with Ind AS 109. After initial recognition, loans are accounted for at amortised cost with interest income determined using the effective interest method. The difference between the amount of loan given on favourable terms and its fair value is an employee benefit. On the date of Transition an amount of Rs.1.52 Lakhs have been reduced from Loans and Advances to Employees \ with a corresponding adjustment to Retained earnings. As on 31.03.2017, this resulted in a decrease of Rs.7.99 Lakhs reduced from Loans and advance to Employees, increase of Rs.14.55 Lakhs in employee cost and increase of Rs.8.08 Lakhs in Other Income. j. Deferred tax:

In the financial statements prepared under Previous GAAP, deferred tax was accounted as per the income statement approach which required creation of deferred tax asset/liability on temporary differences between taxable profit and accounting profit. Under Ind AS, deferred tax is accounted as per the Balance Sheet approach which requires creation of deferred tax asset/liability on temporary differences between the carrying amount of an asset/liability in the Balance Sheet and its corresponding tax base.

The application of Ind AS has resulted in recognition of deferred tax on new temporary differences which were not required to be recognised under Previous GAAP. In addition, the above mentioned transitional adjustments relating to current/non-current investments and goodwill have also led to temporary differences and creation of deferred tax thereon.

The above changes have resulted in creation of deferred tax liabilities (net) amounting to Rs.27310.73 Lakhs as at date of transition to Ind AS and Rs. 27901.29 Lakhs as at 31st March, 2017. For the year ended 31st March, 2017, it has resulted in an increase in deferred tax expense by Rs.680.00 Lakhs in the Statement of Profit and Loss and recognition of deferred tax benefit by Rs.89.44 Lakhs in OCI. k. Effect of Ind As adoption on statement of Cash Flow for the year ended 31.03.2017 :

In the financial statements prepared under Previous GAAP, cash and cash equivalents represented by short term highly liquid funds were recognised at cost. However, under Ind AS, such cash and cash equivalents being financial instruments, are required to be recognised at fair value. The reconciliation items are furnished in Note 52.6.

l. Borrowings

As required under the Ind AS 109 transactions costs incurred towards origination of borrowings have been deducted from the carrying amount of borrowings on initial recognition. These costs are recognised in the Statement of Profit and Loss over the tenure of the borrowing as interest expense, computed using the effective interest rate method corresponding effect being given in borrowings.

Under the previous GAAP, these transaction costs were charged to the Statement of Profit and Loss as and when incurred. Consequently, borrowings as on the date of transition have been reduced by Rs.430.71 Lakhs with a corresponding adjustment to retained earnings. As at 31st March, 2017 borrowings have been reduced by Rs.346.42 Lakhs with a corresponding increase of Rs.84.29 Lakhs in Finance Cost.

After initial recognition, interest-bearing loans and borrowing are subsequently measured at amortised cost using the effective interest rate (“EIR”) method. Gains and losses are recognized in Statement of Profit and Loss when the liabilities are de-recognised as well as through EIR amortisation process. The EIR amortization is included in finance cost in the Statement of Profit and loss. Consequently, borrowings as on the date of transition have been increased by Rs. 6579.01 lakhs with a corresponding adjustment in retained in earnings. As at 31.3.2017 the borrowings have been increased by Rs.1097.26 lakhs with corresponding increase in Finance cost. m. Depreciation and amortization expenses

The Company has elected to measure items of Property, Plant and Equipment at Fair value at the date of transition to Ind AS.

It resulted in an increase of Rs.1051.81 Lakhs in Depreciation in statement of Profit and Loss account for the year ended 31.03.2017. The Company has de-recognised intangible assets on the date of transition to Ind AS. Hence for the year ended 31.3.2017, it resulted in a decrease of Rs.2605.13 Lakhs in amortization expenses in Statement of Profit and Loss account. Further impairment loss of Rs. 1700.00 Lakhs recognized under previous GAAP has been reversed on de-recognition of Capital work in progress on the date of transition to Ind AS. n. Other Comprehensive income

Under previous GAAP, there was no concept of Comprehensive Income. Under Ind AS, specified items of income, expense, gains or losses are required to be presented in other comprehensive income. Hence, the company has reconciled previous GAAP profits to Profit as per Ind AS.

Further, previous GAAP profit is reconciled to total comprehensive income as per Ind AS. o. Re-grouping/Re-classification

Figures relating to April 01, 2016 (date of transition) have been regrouped or reclassified to make them comparable with the Ind AS presentation.

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Mar 31, 2016

1. Basis of Preparation:

The accompanying Financial Statements have been prepared on a going concern basis under the historical cost convention on the accrual basis of accounting in conformity with Generally Accepted Accounting Principles in India ("India GAAP").

2. Change in Accounting Policy:-

Till the financial year ended 31.3.2015, the company had charged the total depreciation to the Statement of Profit and Loss and made transfer of an amount equivalent to additional depreciation on account of upward revaluation of fixed assets from revaluation reserve. In the current year the company has revised the accounting policy prospectively whereby no transfer from revaluation reserve is made through Statement of Profit and Loss.

Had the company continued to follow the earlier accounting policy, the loss for the period would have been lower by Rs.1719.28 lakhs.

3. Valuation of Inventories:

Inventories of raw materials, work-in-progress, stores, finished products and stock-in-trade are valued at the lower of cost or net realizable value. Cost is ascertained on seasonal weighted average for sugar and yearly average for stores and soya products. Soya Bean, Stock-in-trade of fertilizer and newsprint cost ascertained on FIFO basis. By-products are valued at Net realizable value. Standing crops are valued at net realizable value.

4. Fixed Assets:

a) Fixed Assets are shown at cost/re-valued figures, less accumulated depreciation. Fixed assets added during the year are valued at cost net of CENVAT but includes all direct expenses like freight, erection charges, pre operative expenses and borrowing costs.

b) Expenditure including borrowing cost incurred on projects under implementation is shown under "Work-in-Progress" pending allocation to the assets.

5. Intangible Assets:

The payment made towards goodwill to cane ryots and to employees as per wage board settlement during the year 2004-05, is amortized over a period of 10 years in accordance with AS-26.

6. Borrowing Costs:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets.

7. Depreciation:

Depreciation on tangible assets is provided on the straight line method over the useful life in the manner prescribed in the Schedule II of the Companies Act 2013 effective from 1st April 2014, as against the earlier practice of depreciating at the rates prescribed in Schedule XIV of the Companies Act, 1956.

Depreciation on addition to assets or on sale/discernment of assets, is calculated on pro-rata from the month of such addition or up to the month of such sale/discernment, as the case may be.

8. Investment:

Long term Investments are accounted at Cost. The diminution, if any, in value of long term investments is provided if such decline is other than temporary.

9. a) Revenue Recognition:

Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue from sale of goods is recognized when the significant risks and rewards of ownership of the goods are transferred to the customer and is stated net of trade discounts, excise duty and sales return.

i. Gross turnover includes excise duty but exclude sales tax.

ii. Dividend income is accounted for in the year it is declared.

iii. All other incomes are accounted for on accrual basis.

iv. The Excise duty on sale of finished goods is deducted from the turnover to arrive at the net sales as shown in the statement of profit and loss account.

v. Inter segmental transfer price is not recognized.

b) Expenditure Recognition:

i. The Cane price is written off on the basis of determination of statutory price.

ii. The Excise duty appearing in the statement of profit and loss account as an expenditure represents excise duty provision for difference between opening and closing stock of finished goods.

10. Foreign currency transactions:

Recognition of foreign exchange fluctuation is based on the Settlement of obligations.

11. Retirement Benefits:

Contribution payable by the Company under defined contribution schemes towards Provident fund, Gratuity, Employees State Insurance and Superannuation fund for the year are charged to Statement of profit and loss account.

The Company has opted for Life Insurance Corporation of India Group Gratuity Scheme. For calculating gratuity liability, the premium ascertained by LIC has been taken into account.

Provision for liability in respect of Leave encashment benefits are made based on actuarial valuation made by an independent actuary as at 31.03.2016.

12. Segment Reporting:

The segment reporting is in line with the accounting policies of the company. Inter segment transactions have been accounted for based on the price which has been arrived at considering cost for utilities and net realizable value for by-products. Revenue and expenses that are directly identifiable with or allocable to segments are considered for determining the segment results. Segment assets and liabilities include those directly identifiable with the respective segments. Business segments are identified on the basis of the nature of products, the risk/return profile of the individual business, the organizational structure and the internal reporting system of the company.

13. Deferred Tax:

Deferred tax is recognized on timing difference between accounting income and the taxable income for the period and reversal of timing differences of earlier periods and quantified using the tax rates and laws that have been enacted / substantively enacted as at the balance sheet date. The deferred tax assets are recognized and carried forward to the extent that there is reasonable certainty that these would be realized in future.

14. Earning per share:

Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

15. Impairment of Assets:

Impairment, if any, is recognized in accordance with the Accounting Standard 28.

16. Provisions, Contingent Liabilities and Contingent Assets:

Provision is recognized only when there is a present obligation as a result of past event and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

17. Leases:

The company''s significant leasing arrangements are operating leases and are cancelable in nature. The lease rentals paid or received under such arrangements are accounted in the statement of profit and loss.

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Mar 31, 2014

1. The loans under 1 & 4 above are further secured by pledge of shares held by promoters in the Company.

2. Guarantees given by Directors:

a) Working capital loans amounting to Rs.5752.84 lakhs (Rs.5597.19 lakhs) are guaranteed by Dr. N.Mahalingam, Dr. M.Manickam, Sri.M.Balasubramaniam and Sri. M.Srinivaasan.

b) Working capital loan amounting to Rs.889.25 lakhs (Rs.801.21 lakhs) is guaranteed by Dr. N.Mahalingam, and Dr. M.Manickam.

c) Working capital loan amounting to Rs.1495.65 lakhs (Nil) is guaranteed by Dr. M.Manickam.

d) Working capital loans amounting to Rs.752.08 lakhs (Nil) are guaranteed by Sri.M.Balasubramaniam and Sri. M.Srinivaasan.

NATURE OF SECURITYFOR SHORT TERM BORROWINGS

A) SECURED LOANS FROM BANKS

1 Working capital loans amounting to Rs.5144.31 lakhs (Rs.4415.10 lakhs) are secured by

a) Pari passu first charge by way of hypothecation of the current assets of the Company, except TNEB receivables.

b) Pari passu second charge on the entire movable and immovable properties of the Company, except Sugar and Co generation Units in Sivaganga and Modakuruchi and other exclusively charged assets.

2 Working capital loan amounting to Rs.1495.65 lakhs (Nil) is secured by

a) Pari passu first charge by way of hypothecation of the current assets of the Company, except TNEB receivables.

b) Pari passu second charge on the entire movable and immovable properties of the Company, except Sugar and Co-generation Units in Sivaganga and Modakuruchi and other exclusively charged assets.

c) Additionally secured by exclusive first charge on the Coke Bottling Plant at Sivaganga Unit.

3 Term Loan amounting to Rs.400 lakhs (Nil) is secured by receivables from TNEB against supply of power from co-generation plant at Sakthinagar.

4 Working capital loan (Bills Discounting facility) amounting to Rs.608.53 lakhs (Rs.1182.09 lakhs) is secured by

a) Pari passu first charge by way of hypothecation of the current assets of the Company, except TNEB receivables.

b) First charge on the TNEB receivables of Cogen Unit at Sivaganga.

c) Pari passu second charge on the entire movable and immovable properties of the Company, except Sugar and Co-generation Units in Sivaganga and Modakuruchi and other exclusively charged assets.

5 Working capital loan (Bills Discounting facility) amounting to Rs.352.07 lakhs (Nil) is secured by receivables from TNEB against supply of power from co-generation plant at Sakthinagar. 6 Working capital loan amounting to Rs.889.25 lakhs (Rs. 801.21 lakhs) is secured by

a) Pari passu first charge on the current assets of sugar division (except Modakuruchi), distillery and soya units.

b) Pari passu second charge on immovable and movable assets of the Company''s Sakthinagar Distillery Unit, Dhenkanal Sugar and Distillery Units and Soya Unit.

7 The loans under 1 & 4 above are further secured by pledge of shares held by promoters in the Company.

8 Guarantees given by Directors:

a) Working capital loans amounting to Rs.5752.84 lakhs (Rs.5597.19 lakhs) are guaranteed by Dr. N.Mahalingam, Dr. M.Manickam, Sri.M.Balasubramaniam and Sri. M.Srinivaasan.

b) Working capital loan amounting to Rs.889.25 lakhs (Rs.801.21 lakhs) is guaranteed by Dr. N.Mahalingam, and Dr. M.Manickam.

c) Working capital loan amounting to Rs.1495.65 lakhs (Nil) is guaranteed by Dr. M.Manickam.

d) Working capital loans amounting to Rs.752.08 lakhs (Nil) are guaranteed by Sri.M.Balasubramaniam and Sri. M.Srinivaasan.

B) SECURED LOANS FROM OTHER PARTIES

1 Bills Finance facilities amounting to Nil (Rs.1856.46 lakhs) are secured by

a) Receivables from TNEB against supply of power from co-generation plants at Sakthinagar and Modakuruchi.

b) Exclusive first charge on the fixed assets pertaining to Co-generation Plant at Sakthinagar.

2 Guarantees given by Directors:

Short term borrowing amounting to Nil (Rs.1856.46 lakhs) is guaranteed by Dr. M.Manickam, Sri.M.Balasubramaniam and Sri.M.Srinivaasan

3. Contingent liabilities: (Rs. in lakhs)

Particulars 31.03.2014 31.03.2013

A) Claims against the Company not acknowledged as debts:

(i) Income tax matters 6349.34 6590.29

(ii) Purchase tax/sales tax matters 2484.29 2296.58

(iii) Corporate Guarantee given to foreign subsidiaries

(a) Guarantee amount 33030.60 27817.52

(b) Outstanding amount 35031.34 28838.95

(iv) Others 7823.04 7659.51

B) Guarantees issued by bankers 239.01 83.00

C) Corporate guarantee given for loans to Indian subsidiaries

(i) Guarantee amount 12603.49 18522.42

(ii) Outstanding amount 7297.84 8666.00

4. Micro, Small and Medium Enterprises Development Act, 2006 The Company has not received information from vendors regarding their status under The Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures relating to their outstanding amount and interest have not been made.

5. Disclosure pursuant to AS-28 on Impairment of Assets: During the year, a review has been done for carrying value of the assets for finding out the impairment, if any. The review has not revealed any impairment of assets in terms of AS-28, except to the extent of Rs.3.82 lakhs (11.02 lakhs) in the Beverage Division, which has been provided for.

6. Funded Interest under CDR Scheme for Rs.4040.43 lakhs (Rs.5050.54 lakhs) included in Other Non Current Asset in Note No.13 is to be written off over a period of time as and when it becomes payable and it is not realizable in value.

7 . The Company has opted to recognize foreign exchange fluctuation based on maturity of obligations in conformity with the option given by notification No.GSR 913(E) Dated 29th December 2011 issued by the Ministry of Corporate Affairs.

8. Previous year''s figures have been regrouped / restated wherever necessary to correspond with the current year''s classification/ disclosure.

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Mar 31, 2013

1 Related Parties Disclosure:

I. Related Parties:

a. Subsidiary Companies

Sakthi Auto Component Limited Sakthi Auto Ancillary Private Limited

b. Associates

ABT Limited

ABT Industries Limited

ABT Info Systems Pvt. Limited

ABT Foods Limited

Anamallais Bus Transport Pvt. Limited

Sakthi Finance Limited

Sri Chamundeswari Sugars Limited (SCSL)

Nachimuthu Industrial Association

The Gounder & Co

c. Key Managerial Personnel (KMP)

Dr. N Mahalingam, Chairman

Dr. M Manickam, Vice Chairman and Managing Director Sri M Balasubramaniam, Joint Managing Director - Finance Sri M Srinivaasan, Joint Managing Director - Technical Sri V K Swaminathan, Executive Director

d. Relatives of Key Managerial Personnel

There has been no transaction with the relatives of key managerial personnel

e. Enterprises in which KMP/Relatives of KMP can exercise significant influence

Anamallais Retreading Corporation

N.Mahalingam & Company

Sakthi Automobiles

Sakthi Coffee Estates (P) Limited

ABT Textiles (P) Limited

Sri Bhagavathi Textiles Limited

Sri Sakthi Textiles Limited

Note : Information has been furnished with respect to individuals/entities with whom/which related party transactions had taken place during the year

2 Micro, Small and Medium Enterprises Development Act, 2006

The Company has not received information from vendors regarding their status under The Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures relating to their outstanding amount and interest have not been made.

3 Disclosure as required under clause 32 of the listing agreement:

Amount of loans and advances in the nature of loans to subsidiaries and associates and the maximum amount outstanding during 2012-13:

4 Disclosure pursuant to AS-28 on Impairment of Assets:

During the year, a review has been done for carrying value of the assets for finding out the impairment, if any. The review has not revealed any impairment of assets in terms of AS-28, except to the extent of Rs.11.02 lakhs (Rs.237.12 lakhs) in the Beverage Division, which has been provided for.

5 Funded Interest under CDR Scheme for Rs.5050.54 lakhs (Rs.6060.65 lakhs) included in Other Non Current Asset in Note No. 13 is to be written off over a period of time as and when it becomes payable and it is not realizable in value.

6 The company has opted to recognize foreign exchange fluctuation based on maturity of obligations in conformity with the option given by notification No.GSR 913(E) dated 29th December 2011 issued by the Ministry of Corporate Affairs.

7 Previous year''s figures have been regrouped / restated wherever necessary to correspond with the current year''s classification/disclosure.

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Mar 31, 2012

Rights, Preferences and Restrictions of each class of Shares

The Company has only one class of Equity shares having face value of Rs.10 each. Each shareholder is eligible for one vote per share. Dividend is payable when it is recommended by the Board of Directors and approved by the Members at the Annual General Meeting. In the event of liquidation, the equity shareholders will get the remaining assets after payment of all the preferential amounts.

1 The term loans under 1 & 2 above are further secured by pledge of shares held by the promoters in the Company.

2 Guarantees given by Directors/Others:

a) Term loans amounting to Rs.54032.32 lakhs (Rs.63087.91 lakhs) are guaranteed by Dr. N.Mahalingam, Dr. M.Manickam, Sri.M.Balasubramaniam and Sri. M.Srinivaasan.

b) Term loans amounting to Rs.5860 lakhs (Nil) are guaranteed by Dr. M.Manickam, Sri M.Balasubramaniam and Sri M.Srinivaasan.

c) Term loan amounting to Rs. 2456 lakhs (Nil) is additionally secured by corporate guarantee and collateral security given by a group company.

3 An amount of Rs.14016.20 lakhs (Rs. 17206.91 lakhs) included in current maturities of long term debts (Note No.7) is additionally secured by corporate guarantee and collateral security given by a group company.

4 An amount of Rs.574.80 lakhs (Rs. 793.09 lakhs) included in current maturities of long term debts (Note No.7) is additionally secured by corporate guarantee and collateral security given by a group company.

5 Period and amount of continuing default as on the date of Balance Sheet :

NATURE OF SECURITY FOR SHORT TERM BORROWINGS

A) SECURED LOANS FROM BANKS

1 Working capital loans amounting to Rs.4266.99 lakhs (Rs.1439.69 lakhs) are secured by

a) Pari passu first charge by way of hypothecation of the current assets of the Company, except TNEB receivables.

b) Pari passu second charge on the entire movable and immovable properties of the Company, except Sugar and Co-generation Units in Sivaganga and Modakuruchi.

2 Working capital loan (Bills Discounting facility) amounting to Rs.1145.38 lakhs (Rs.1190.34 lakhs) secured by

a) Pari passu first charge by way of hypothecation of the current assets of the Company, except TNEB receivables.

b) First charge on the TNEB receivables of Cogen Unit at Sivaganga.

c) Pari passu second charge on the entire movable and immovable properties of the Company, except Sugar and Co-generation Units in Sivaganga and Modakuruchi.

3 Working capital loan amounting to Rs.759.61 lakhs (Rs. 698.28 lakhs) is secured by

a) Pari passu first charge on the current assets of sugar division (except Modakuruchi), distillery and soya units.

b) Pari passu second charge on the immovable and movable assets of the Company's sugar (except Sivaganga & Modakuruchi), distillery and soya units.

4 Short term corporate term loan amounting to Rs 838.45 lakhs (Nil) is secured by assignment of receivables from TNEB amounting to Rs.1047 lakhs.

5 Working capital loan amounting to Nil (Rs.564.69 lakhs) is secured by

a) Exclusive charge by way of hypothecation of raw sugar in transit from bonded warehouse in ports, raw and processed sugar at the sugar factories of the company, white sugar in transit for export and documents of title to goods covered under LC/EBN, packing materials, etc.

b) Pari passu second charge on the immoveable assets of the Company, except assets exclusively charged.

6 Working capital loan amounting to Nil (Rs.600 lakhs) is secured by

a) Pari passu first charge on stocks and receivables.

b) Pari passu second charge on fixed assets of the Company, except assets exclusively charged.

7 The loans under 1 & 2 above are further secured by pledge of shares held by the promoters in the Company.

8 Guarantees given by Directors:

a) Working capital loans amounting to Rs.5412.37 lakhs (Rs.2630.03 lakhs) are guaranteed by Dr. N.Mahalingam, Dr. M.Manickam, Sri.M.Balasubramaniam and Sri. M.Srinivaasan.

b) Working capital loan amounting to Rs.759.61 lakhs (Rs.698.28 lakhs) is guaranteed by Dr. N.Mahalingam and Dr. M.Manickam.

c) Short term corporate loan amounting to Rs. 838.45 lakhs (Rs.1164.69 lakhs) is guaranteed by Dr. M.Manickam .

B) SECURED LOANS FROM OTHER PARTIES

1 Bills Finance facility amounting to Rs.1867.76 lakhs (Nil) is secured by

a) Pari passu first charge on the assets pertaining to Co-generation Plant at Sakthinagar.

b) Receivables from TNEB against supply of power from Co-generation plant at Sakthinagar.

2 Guarantees given by Directors:

Short term borrowing amounting to Rs. Rs.1867.76 lakhs (Nil) is guaranteed by Dr. M.Manickam, Sri.M.Balasubramaniam and Sri.M.Srinivaasan.

SHORT TERM UNSECURED BORROWINGS

A) UNSECURED LOANS FROM BANKS

Bill discounting facility amounting to Rs.478.00 lakhs (Nil) is guaranteed by Dr.M.Manickam.

B) UNSECURED LOANS FROM OTHER PARTIES

Bill discounting facility amounting to Rs.244.98 lakhs (Rs.500 lakhs) is guaranteed by Dr.M.Manickam.

1 Related Parties Disclosure:

I. Related Parties:

a. Subsidiary Companies

Sakthi Auto Component Limited

Sakthi Auto Ancillary Private Limited

b. Associates

ABT Limited ABT Industries Limited

ABT Info Systems Pvt. Limited

ABT Foods Limited

Anamallais Bus Transport Pvt. Limited

Sakthi Finance Limited

Sri Chamundeswari Sugars Limited

Nachimuthu Industrial Association

The Gounder & Co

c. Key Managerial Personnel (KMP)

Dr. N Mahalingam, Chairman

Dr. M Manickam, Vice Chairman and Managing Director

Sri M Balasubramaniam, Joint Managing Director - Finance

Sri M Srinivaasan, Joint Managing Director - Technical

Sri V K Swaminathan, Executive Director

d. Relatives of Key Managerial Personnel

There has been no transaction with the relatives of key managerial personnel

e. Enterprises in which KMP/Relatives of KMP can exercise significant influence

Anamallais Retreading Corporation

N.Mahalingam & Company

Sakthi Automobiles

Sakthi Coffee Estates (P) Limited

ABT Textiles (P) Limited

Sri Bhagavathi Textiles Limited

Sri Sakthi Textiles Limited

Note : Information has been furnished with respect to individuals/entities with whom/which related party transactions had taken place during the year

2 Contingent liabilities: (Rs. in lakhs)

Particulars 31.03.2012 31.03.2011

A) Claims against the Company not acknowledged as debts:

(i) Income tax matters 5650.81 394.68

(ii) Purchase tax/sales tax matters 2673.06 2691.80

(iii) Others 5489.95 4943.37

B) Guarantees issued by bankers 49.01 29.01

C) Corporate guarantee given for loans to subsidiaries:

(i) Guarantee amount 48581.58 43381.88

(ii) Outstanding amount 40885.03 37469.98

3 Micro, Small and Medium Enterprises Development Act, 2006

The Company has not received information from vendors regarding their status under The Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures relating to their outstanding amount and interest have not been made.

4 Disclosure pursuant to AS-28 on Impairment of Assets:

During the year, a review has been done for carrying value of the assets for finding out the impairment, if any. The review has not revealed any impairment of assets in terms of AS-28, except to the extent of Rs. 237.12 lakhs in the Beverage Division, which has been provided for.

5 Funded Interest under CDR Scheme for Rs.6060.65 lakhs (Previous year Rs.8080.86 lakhs) included in Other Non Current Asset in Note No. 13 is to be written off over a period of time as and when it becomes payable and it is not realizable in value.

6 During the year under review, the Company has opted to recognize foreign exchange fluctuation based on maturity of obligations in conformity with the option given by Notification No: GSR 913(E) Dated 29th December 2011 issued by the Ministry of Corporate Affairs.

7 The Revised Schedule VI has become effective from 1st April 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / restated wherever necessary to correspond with the current year's classification/disclosure.

8 Current year figures are not comparable with the previous year figures as the current year is for a period of 12 months whereas the previous year figures are for a period of 15 months.

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Mar 31, 2011

A. SECURED LOANS

1. LOANS UNDER CDR

I. FROM BANKS

a) The amount outstanding under Secured Loans from Banks includes Term Loans, Working Capital Term Loans and Funded Interest Term Loans aggregating to Rs.83,155.19 lakhs (including interest) from Axis Bank Ltd, Allahabad Bank, Bank of India, Canara Bank, HDFC Bank Limited, IDBI Bank, Indian Overseas Bank, Oriental Bank of Commerce, Punjab National Bank and State Bank of India. These Loans are secured by:

i) Pari passu first charge on the entire movable and immovable properties of the Company except the assets charged on exclusive basis;

ii) Pari passu second charge on the current assets of the Company;

iii) Pledge of shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director (Finance) and Joint Managing Director (Technical); and

v) Collateral security and Corporate Guarantee provided by a promoter company

b) The amount outstanding under Secured Loans from Banks includes Term Loans and Funded Interest Term Loans aggregating to Rs. 3,875.94 lakhs (including interest) from Allahabad Bank. These Loans are secured by:

i) Pari passu First charge on the entire movable and immovable properties of the Company except the assets charged on exclusive basis;

ii) First charge on the assets pertaining to Co-generation Plant I at Sakthi Nagar ranking pari passu with TIIC;

iii) Pari passu second charge on the current assets of the Company;

iv) Pledge of shareholdings of the promoters in the Company;

v) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director (Finance) and Joint Managing Director (Technical); and

vi) Collateral security and Corporate Guarantee provided by a promoter company.

c) The amount outstanding under Secured Loans from Banks includes Term Loan of Rs.2,841.12 lakhs (including interest) from State Bank of India. This loan is secured by:

i) Residual charge on the entire fixed assets of the Company. The charge on the assets of sugar division ranking pari passu with Bank of India, Canara Bank, HDFC Bank and Indian Overseas Bank;

ii) Residual charge on the current assets of the Company;

iii) Pledge of shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director (Finance) and Joint Managing Director (Technical); and

v) Collateral security and Corporate Guarantee provided by a promoter company.

d) The amount outstanding under Hypothecation loans from Banks includes Working Capital facilities of Rs. 1,439.69 lakhs from Bank of India, HDFC Bank and Indian Overseas Bank which are secured by:

i) First charge by way of hypothecation of the current assets of the Company ranking pari passu with Citibank;

ii) Pari passu second charge on the entire movable and immovable properties of the Company except Sugar and Co-generation Units in Sivaganga and Modakuruchi;

iii) Pledge of shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director (Finance) and Joint Managing Director (Technical); and

v) Collateral security and Corporate Guarantee provided by a promoter company.

e) The amount outstanding under Secured Loans includes Bill Discounting limit of Rs.1,200.04 lakhs (including interest) from Bank of India. The loan is secured by:

i) First charge by way of hypothecation of the current assets of the Company ranking pari passu with HDFC Bank, Indian Overseas Bank and Citibank N.A

ii) First charge on the TNEB receivables;

iii) Pari passu second charge on the entire movable and immovable properties of the Company except Sugar and Co-generation Units in Sivaganga and Modakuruchi;

iv) Pledge of shareholdings of the promoters in the Company;

v) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director (Finance) and Joint Managing Director (Technical); and

vi) Collateral security and Corporate Guarantee provided by a promoter company.

II. FROM OTHERS

The amount outstanding under Secured Loans from Others includes Term Loan and Funded Interest Term Loan aggregating to Rs.4,702.16 lakhs (including interest) from Infrastructure Development Finance Company (IDFC) Limited. This loan is secured by:

i) Pari passu first charge on the entire movable and immovable properties of the Company except the assets charged on exclusive basis;

ii) Pari passu second charge on the current assets of the Company;

iii) Pledge of shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director (Finance) and Joint Managing Director (Technical); and

v) Collateral security and Corporate Guarantee provided by a promoter company.

The Collateral security and the Corporate Guarantee provided by a promoter company for the loans under serial Nos.l (a)(c)(d)(e) and II above are subject to an overall limit of Rs.180 crores and is subservient to the loans from Allahabad Bank under serial No.l(b) above and the loan from TIIC.

2. LOANS OUTSIDE CDR

I. FROM BANKS

a) The amount outstanding under Secured Loans from Banks includes Interest Free Excise Duty Term Loans aggregating to Rs.3,013.54 lakhs from Bank of India, Canara Bank, HDFC Bank and Indian Overseas Bank. These Loans are secured by:

i) Residual charge on the Fixed Assets of the Sugar Units of the Company ranking pari passu with State Bank of India; and

ii) Personal Guarantees of Chairman and Vice Chairman & Managing Director.

b) The amount outstanding under Hypothecation Loans from Banks includes Working Capital facility of Rs.706.96 lakhs (including interest) from Citibank which is secured by:

i) First charge by way of hypothecation of finished goods, raw materials, stock in process, stores and spares, book debts of the Company's sugar (except Modakurichi), distillery & soya units ranking pari passu with Bank of India, HDFC Bank and Indian Overseas Bank;

ii) Second charge on the immovable & movable assets of the Company's sugar (except Sivaganga & Modakurichi), distillery & soya units; and

iii) Personal guarantees of Chairman and Vice Chairman & Managing Director.

c) The amount outstanding under Hypothecation Loans from Banks includes Working Capital (Packing Credit) facility of Rs.578.92 lakhs (including interest) from Central Bank of India which is secured by:

i) Exclusive charge by way of hypothecation of raw sugar in transit from the bonded warehouse from ports, raw and processed sugar at the sugar factories of the company, white sugar in transit for export and documents of title to goods covered under LC/EBN, Packing materials etc.

ii) Second Charge on the immoveable assets of the company except assets exclusively charged ranking pari passu with the existing member banks of consortium for working capital facility.

iii) Personal Guarantee of Vice Chairman & Managing Director.

d) The amount outstanding under Hypothecation Loans from Banks includes Working Capital (Adhoc Cash Credit Limit) facility of Rs.600 lakhs from Bank of India which is secured by:

i) First pari passu charge on stocks and receivables.

ii) Second pari passu charge on Block assets to cover Working Capital Fund Based /Non Fund Based Limits (except assets exclusively charged).

iii) Personal Guarantee of Vice Chairman & Managing Director.

II. FROM OTHERS

1) The amount outstanding under Secured Loans from Others includes Term Loan of Rs.2,531.70 lakhs from Tamilnadu Industrial Investment Corporation Limited (TIIC). This loan is secured by:

i) First Charge on the movable and immovable assets of the Company's Cogen Plant-I at Sakthinagar Sugar Unit on pari passu basis with Allahabad Bank;

ii) Escrow of the receivable on evacuation of power to Tamil Nadu Electricity Board (TNEB) from the Co-gen plant-l at Sakthinagar;

iii) Escrow of receivable on sale of ethanol from the Company's distillery unit at Sakthinagar;

iv) Personal Guarantees of Chairman and Vice-Chairman & Managing Director; and

v) Collateral security provided by a promoter company.

2) The amount outstanding under Secured Loans from Others includes Corporate Loan of Rs.9.76 lakhs availed by the Company from Housing Development Finance Corporation Ltd (HDFC). This loan is secured by a mortgage of Company's property at New Delhi.

3) The amount outstanding under Secured Loans from Others includes Term Loan of Rs.3,614.56 lakhs availed by the Company from Sugar Development Fund (SDF) of Government of India. This loan is secured by exclusive second charge on the assets of sugar and cogen units at Sivaganga unit of the company.

4) The amount outstanding under Secured Loans from Others includes Term Loan of Rs.801.86 availed by the Company from Sugar Development Fund (SDF) of Government of India. This loan is secured by exclusive second charge on the assets of sugar and cogen units at Modakuruchi unit of the company.

5) The amount outstanding under Hire Purchase Loans aggregating to Rs.76.75 lakhs (total amount payable including future interest is Rs.88.07 lakhs) represents the amount availed by the Company from public limited companies and is secured by hypothecation of the vehicles so financed.

C. FOREIGN CURRENCY CONVERTIBLE BONDS

The Company had issued during May 2006, Zero coupon - Foreign Currency Convertible Bonds in two series aggregating to US$ 60 Million (Series A - US$ 20 million and Series B - US$ 40 million). These Bonds are convertible at the option of the holders into fully paid Equity shares at such conversion price as determined in accordance with the Offer Letter, but not less than Rs. 177.39 per share. Bonds of value aggregating to US$24.10 Million have been converted into 54,34,273 fully paid Equity shares at the conversion price of Rs.208 and Rs.190 per share for Series A and Series B respectively. Bonds for value aggregating to US$ 6.30 Million have been redeemed @40%. As on 31.3.2011, balance outstanding is US$ 1.0 Million of Series A Bonds and US$ 28.6 Million of Series B Bonds.

F. Borrowing Cost capitalized during the year is Rs. 1,020.88 lakhs (Previous year Rs.630.92 lakhs).

G. The Company has pledged 4,38,59,394 equity shares holding in Sakthi Auto Component Limited (SACL), wholly owned subsidiary, to secure the loan and obligation in relation to SACL.

K. RELATED PARTIES DISCLOSURE

I. RELATED PARTIES

A. SUBSIDIARY COMPANIES

Sakthi Auto Component Limited

Sakthi Auto Ancillary Private Limited

Tilan Sugar Limited (since dissolved)

B. KEY MANAGERIAL PERSONNEL

Dr N Mahalingam, Chairman

Dr M Manickam, Vice Chairman and Managing Director

Sri M Balasubramaniam, Joint Managing Director (Finance)

Sri M Srinivaasan, Joint Managing Director (Technical)

Sri V K Swaminathan, Executive Director

C. RELATIVES OF KEY MANAGERIAL PERSONNEL

There have been no transactions with relatives of key managerial personnel

D. ENTERPRISES WHERE CONTROL EXIST

ABT Limited

ABT Industries Limited

ABT Info Systems Pvt. Ltd

Anamallais Bus Transport Pvt. Ltd

Sakthi Finance Limited

Sakthi Logistic Services Ltd.

Sri Chamundeswari Sugars Limited (SCSL)

Nachimuthu Industrial Association

E. ENTERPRISES IN WHICH KEY MANAGERIAL PERSONNEL/RELATIVES OF KEY MANAGERIAL PERSONNEL HAVE SIGNIFICANT INFLUENCE

ARC Petroleum Services

N.Mahalingam & Company

Sakthi Automobiles

Sakthi Coffee Estates (P) Ltd

Note: Information has been furnished with respect to individuals/entities with whom/which related party transactions had taken place during the year.

O. The company has not received information from vendors regarding their status under The Micro, Small & Medium Enterprises Development Act, 2006 and hence disclosures relating to their outstanding amount and interest have not been made.

S. DISCLOSURE PURSUANT TO AS-28 ON 'IMPAIRMENT OF ASSETS'

During the year, review has been done for carrying value of the assets for finding out the impairment, if any. The review has not revealed any impairment of assets in terms of AS-28.

T. CONTINGENT LIABILITIES IN RESPECT OF

(Rs. in lakhs)

Particulars 31.03.2011 31.12.2009

Income tax matters 394.68 1168.05

Purchase tax/sales tax matters 2691.80 2205.45

Excise/service tax matters 3293.16 3487.73

Water tax 822.40 662.34

Claims against the company not acknowledged as debts 827.81 1208.70

Note: Above matters are subject to legal proceedings in the ordinary course of business. The legal proceedings when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position of the company.

Guarantees issued by bankers 29.01 28.01

Corporate guarantee given for loans to subsidiaries

a. Guarantee amount 43381.88 53945.30

b. Outstanding amount 37469.98 44299.33

Export obligation:

Obligation for export of sugar (in lakh Mts) - 1.67

Duty component to be paid in case of non fulfillment of obligation - 15524.92

U. Wherever necessary, figures for previous year have been regrouped or reclassified to conform to this year's grouping or classification.

V. Previous year's figures are not comparable with the current year figures as the current year is for a period of 15 months whereas previous year's figures were for a period of 12 months.

---

Dec 31, 2009

A. SECURED LOANS:

LOANS UNDER CDR:

I. FROM BANKS:

a) The amount outstanding under Secured Loans from Banks includes Term Loans, Working Capital Term Loans and Funded Interest Term Loans aggregating to Rs.78,930.05 lakhs (including interest) from Axis Bank Ltd, Bank of India, Canara Bank, HDFC Bank, IDBI Bank, Indian Overseas Bank, Oriental Bank of Commerce, Punjab National Bank and State Bank of India. These Loans are secured/to be secured by-

i) Pari passu first charge on the entire movable and immovable properties of the Company except the assets charged on exclusive basis;

ii) Pari passu second charge on the current assets of the Company;

iii) Pledge of entire shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director- Finance and Joint Managing Director-Technical; and

v) Collateral security and Corporate Guarantee provided by a promoter company upto a limit of Rs.180 crores in favour of lenders under CDR.

b) The amount outstanding under Secured Loans from Banks includes Term Loans and Funded Interest Term Loans aggregating to Rs.7,474.83 lakhs from Allahabad Bank. These Loans are secured/ to be secured by -

i) Pari passu first charge on the entire movable and immovable properties of the Company except the assets charged on exclusive basis;

ii) First charge on the assets pertaining to Co-generation Plant I at Sakthinagar ranking pari passu with TIIC;

iii) Pari passu second charge on the current assets of the Company;

iv) Pledge of entire shareholdings of the promoters in the Company;

v) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director- Finance and Joint Managing Director-Technical; and

vi) Collateral security and Corporate Guarantee provided by a promoter company.

c) The amount outstanding under Secured Loans from Banks includes Term Loan of Rs.2779.75 lakhs from State Bank of India. This loan is secured/to be secured by -

i) Residual charge on the entire fixed assets of the Company. The residual charge on the fixed assets pertaining to sugar units rank pari passu with Bank of India, Canara Bank, HDFC Bank and Indian Overseas Bank;

ii) Residual charge on the current assets of the Company;

iii) Pledge of entire shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director- Finance and Joint Managing Director-Technical; and

v) Collateral security and Corporate Guarantee provided by a promoter company.

d) The amount outstanding under Hypothecation loans from Banks includes Working Capital facilities of Rs. 1396.56 lakhs (including interest) from Bank of India, HDFC Bank and Indian Overseas Bank which are secured by -

i) First charge by way of hypothecation of the current assets of the Company ranking pari passu with Citibank;

ii) Pari passu second charge on the entire movable and immovable properties of the Company except Sivaganga Sugar and Co-generation Units;

iii) Pledge of entire shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director- Finance and Joint Managing Director-Technical; and

v) Collateral security and Corporate Guarantee provided by a promoter company.

II. FROM OTHERS:

The amount outstanding under Secured Loans from Others includes Term Loan and Funded Interest Term Loan aggregating to Rs.4,604.85 lakhs (including interest) from Infrastructure Development Finance Company Limited (IDFC). This loan is secured/to be secured by -

i) Pari passu first charge on the entire movable and immovable properties of the Company except the assets charged on exclusive basis;

ii) Pari passu second charge on the current assets of the Company;

iii) Pledge of entire shareholdings of the promoters in the Company;

iv) Personal Guarantees of Chairman, Vice Chairman & Managing Director, Joint Managing Director- Finance and Joint Managing Director-Technical; and

v) Collateral security and Corporate Guarantee provided by a promoter company.

B. LOANS OUTSIDE CDR:

I. FROM BANKS:

a) The amount outstanding under Secured Loans from Banks includes Interest Free Excise Duty Term Loans aggregating to Rs.5166.11 lakhs from Bank of India, Canara Bank, HDFC Bank and Indian Overseas Bank. These Loans are secured by -

i) Residual charge on the fixed assets of the Sugar Units of the Company ranking pari passu

with State Bank of India; and ii) Personal Guarantees of Chairman and Vice Chairman & Managing Director.

b) The amount outstanding under Hypothecation Loans from Banks includes Working Capital facility of Rs.699.47 lakhs (including interest) from Citibank which is secured by -

i) First charge by way of hypothecation of finished goods, raw Materials, stock in process, stores and spares, book debts of the Companys sugar (except Modakurichi), distillery & soya units ranking pari passu with Bank of India, HDFC Bank and Indian Overseas Bank;

ii) Second charge on the immovable & movable assets of the Companys Sugar (except Sivaganga & Modakurichi), Distillery & Soya units; and

iii) Personal guarantees of Chairman and Vice Chairman & Managing Director.

II. FROM OTHERS:

1) The amount outstanding under Secured Loans from Others includes Term Loan of Rs.3120.73 lakhs (including interest) from Tamilnadu Industrial Investment Corporation Limited (TIIC). This loan is secured by:-

i) First Charge on the movable and immovable assets of the Companys Cogen Plant-I at Sakthinagar Sugar Unit on pari passu basis with Allahabad Bank;

ii) Escrow of the receivable on evacuation of power to Tamil Nadu Electricity Board (TNEB) from the Co- gen plant-l at Sakthinagar on pari passu basis with Allahabad Bank;

iii) Escrow of receivable on sale of ethanol from the Companys distillery unit at Sakthinagar;

iv) Personal Guarantees of Chairman and Vice-Chairman & Managing Director; and

v) Collateral security provided by a promoter company.

2) The amount outstanding under Secured Loans from Others includes Corporate Loan of Rs.26.08 lakhs availed by the Company from Housing Development Finance Corporation Ltd (HDFC). This loan is secured by a mortgage of Companys property at New Delhi.

3) The amount outstanding under Secured Loans from Others includes Term Loan of Rs. 197.84 lakhs availed by the Company from Sugar Development Fund (SDF) of Government of India. This loan is secured by pari passu first charge on the fixed assets of the Companys sugar units at Sakthinagar, Sivaganga and Dhenkanal.

4) The amount outstanding under Secured Loans from Others includes interest amounting to Rs.41.49 lakhs on the Term Loan availed by the Company from Technology Information Forecasting and Assessment Council (TIFAC). This loan is secured by exclusive first charge on the assets acquired under the Scheme. This loan is further secured by personal guarantee of Vice Chairman & Managing Director.

5) The amount outstanding under Hire Purchase Loans aggregating to Rs.67.31 lakhs represents the amount availed by the Company from public limited companies and is secured by hypothecation of the vehicles so financed.

C. FIXED DEPOSITS:

The aggregate amount of fixed deposits guaranteed by Vice-Chairman & Managing Director is Rs.25.94 lakhs.

D. FOREIGN CURRENCY CONVERTIBLE BONDS:

The Company had issued during May 2006, Zero coupon - Foreign Currency Convertible Bonds in two series aggregating to US$ 60 Million (Series A - US$ 20 million and Series B - US$ 40 million). These Bonds are convertible at the option of the holders into fully paid Equity shares at such conversion price as determined in accordance with the Offer Circular, but not less than Rs.177.39 per share. As on 31.12.2009, Bonds of value aggregating to US$15.40 Million have been converted into 34,60,569 fully paid Equity shares at the conversion price of Rs.208 and Rs.190 per share for Series A and Series B respectively. Subsequently Bonds of value aggregating to US$ 8.70 Million have been converted in to 19,73,704 fully paid Equity shares on the same pricing terms during the months of January and March 2010.

G. Borrowing Cost capitalized during the year is Rs. 630.92 lakhs (Previous year Rs.2783.25 lakhs).

H. The Company has pledged 4,38,59,394 equity shares held in SACL, the wholly owned subsidiary, to secure the loan and obligation in relation to SACL.

M. RELATED PARTIES DISCLOSURE

I. RELATED PARTIES

A. SUBSIDIARY COMPANIES

Sakthi Auto Component Limited

Sakthi Auto Ancillary Private Limited

Tilan Sugar Limited

Orlandofin B.V.

Sakthi Netherlands B.V.

Sakthi European Foreign Sales Corporation B.V.

Sakthi Holdings B.V.

Sakthi Service GMBH

Sakthi Portugal SA

B. KEY MANAGERIAL PERSONNEL

Dr. N Mahalingam, Chairman

Sri M Manickam, Vice Chairman and Managing Director Sri M Balasubramaniam, Joint Managing Director-Finance Sri M Srinivaasan, Joint Managing Director-Technical Sri V K Swaminathan, Executive Director

C. RELATIVES OF KEY MANAGERIAL PERSONNEL

There have been no transactions with relatives of key managerial personnel.

D. ENTERPRISES WHERE CONTROL EXIST

ABT Limited

ABT Industries Limited

ABT Info Systems Pvt. Ltd

Anamallais Bus Transport Pvt. Ltd

Sakthi Finance Limited

Sakthi Logistic Services Ltd.

Sri Chamundeswari Sugars Limited (SCSL)

Nachimuthu Industrial Association

E. ENTERPRISES IN WHICH KEY MANAGERIAL PERSONNEL/RELATIVES OF KEY MANAGERIAL PERSONNEL HAVE SIGNIFICANT INFLUENCE

ARC Petroleum Services N.Mahalingam & Company Sakthi Automobiles Sakthi Coffee Estates (P) Ltd.

Q. The company has not received information from vendors regarding their status under The Micro, Small & Medium Enterprises Development Act, 2006 and hence disclosures relating to their outstanding amount and interest has not been made.

R. EMPLOYEE BENEFITS

Gratuity and Provident Fund:

Gratuity, Provident Fund and Employees State Insurance are defined Contribution Plans. The expenses recognised in the Profit and Loss Account:-

U. DISCLOSURE PURSUANTTOAS-28 ON IMPAIRMENTOF ASSETS:

The Company during the year, has reviewed carrying value of the assets for finding out the impairment, if any. The review has not revealed any impairment of assets in terms of AS-28.

V. CONTINGENT LIABILITIES IN RESPECT OF -

(Rs. in Lakhs)

Particulars 31.12.2009 31.12.2008

Income tax matters 1168.05 708.20

Purchase tax/sales tax matters 2205.45 2250.54

Excise/service tax matters 3487.73 3018.98

Water tax 662.34 617.81

Claims against the company not acknowledged as debts 1208.70 1638.94

Note: Above matters are subject to legal proceedings in the ordinary course of business. The legal proceedings when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position of the company.

Guarantees issued by bankers 28.01 35.53 Corporate guarantee given for loans to subsidiaries

a. Guarantee amount 53945.30 63408.55

b. Outstanding amount 44299.33 53268.96

Export obligation:

Obligation for export of sugar (in lakh Mts) 1.67 1.71

Duty component to be paid in case of non fulfillment of obligation 15524.92 15866.58

W. Wherever necessary, figures for previous year have been regrouped or reclassified to conform to this years grouping or classification.

X. Previous years figures are not comparable with the current year figures as the current year is for a period of 12 months whereas previous years figures were for a period of 18 months.