October-December 2011Vol. 6, No. 4 Complimentary copy

(For private circulation only)

A q u a r t e r l y n e w s l e t t e r o f S i m b h a o l i S u g a r s L i m i t e d

SIMBHAOLI SUGARS

Specialty Sugars Potable Liquor Ethanol Power

Chief Executive Officer’s Message

OV

ER

VI

EW

The international sugar market has shown decreased volatility this quarter. Global macroeconomic conditions

remain the key driving force in the market. Fortunately, the INR/USD has moved in conjunction with the world market white sugar price. This has, for the time being, kept Indian exports viable and eased some of the domestic sugar oversupply.

Another redeeming feature is that finally policy makers in the country are becoming aware of the woes of the sugar industry on account of stifling Government intervention, policy inertia and absence of realistic initiatives. The recent Open General Licence (OGL) announcement permitting sugar exports of one MMT for 2011-12 produce reflects a new trend and is a step in the right direction. I hope the new OGL policy reflects the

Government's industry-friendly approach and is a harbinger of structural reforms and liberal policies, which is, as far as the sugar industry is concerned, the need of the hour.

The domestic sugar industry continues to struggle due to

depressed retail prices, high input costs (sugar prices remained

about ` 4 to ` 5 per kg below the cost of production) and low

sugar recovery in north India. Despite efforts to strengthen the

by-products (power and alcohol) businesses, the revenues generated therein were not sufficient to help sugar mills achieve

a break-even position.

All the three sugar plants of your Company started crushing operations on time and as per the Business Plan. The focus continues to be the high value speciality sugar segments, which are expected to grow at about 30% per annum. On the potable alcohol business front, the Company has temporarily withdrawn from the Uttar Pradesh country liquor segment on account of absence of policy reforms and clarity. We hope to take a fresh view on this matter in the new excise

year 2012-2013.

Best wishes,

Dr. G.S.C. Rao

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Simbhaoli Power Limited (SPL), the newly established subsidiary company to acquire power generation business of Simbhaoli Sugars.

The subsidiary will be a joint venture with Sindicatum Sustainable Resources Group, a leading developer and operator of clean energy projects world wide.

Biomass-based power generation capacity to be hiked to 115 mw at an estimated cost of ̀ 3.3 bn.

Simbhaoli Sugars will transfer the existing power assets of the co-generation plants

Simbhaoli Sugars Powers Clean Power Generation JV with Sindicatum Sustainable Resourceslocated within its Simbhaoli, Chilwaria and Brijnathpur complexes to Simbhaoli Power Limited (SPL), the joint venture company, in consideration of cash, shares and other securities. The existing power undertakings are to be transferred at a value of ̀ 1.96 bn to Sindicatum Sustainable Resources Group through its subsidiary, Sindicatum Captive Energy Singapore Pte Ltd., which will acquire 49% of the share capital in SPL. Following the acquisition, Simbhaoli Sugars and Sindicatum (via SPL) will be jointly responsible for generation, sales and the upgradation and maintenance of the power assets.

Fourth quarter ended September 30, 2011

! Net turnover for the quarter ̀ 1782 mn (` 2307 mn in Q4 FY10)

! Positive EBIDTA ̀ 140 mn (negative ̀ 258 mn in Q4 FY10)

! Loss after tax ̀ 160 mn, against ̀ 392 mn loss in Q4 FY10

! Off season expenses aggregating ̀ 306 mn deferred for inclusion in cost of sugar to be produced in coming season

! 2.5 lacs cases of IMFL sold. Increased presence in Delhi and NCR

! No cane crushing, raw refining and power generation during the quarter.

! Average sugar realisation ̀ 28.9 per kg

! Exports of 2100 mt sugar at an average realisation of ̀ 33.5 per kg

Highlights of Financial Results

1,24

7

63

637

0 17

1,87

8

42 428

12 5

0

600

400

200

800

1,000

1,200

1,400

1,600

1,800

2,000

Sugar Molasses Liquor &Spirits

Power Others

Sept.,11

Sept.,10

Comparison of Sales for the Quarter(Rs. in million)

Product wise Share of Sales (Quarter)

Others 1%

Molasses 3% Sugar 73%

Liquor & Spirits 32%

(L to R) Mr. Sanjay Tapriya, Mr. Anshul Jain, Mr. Gurpal Singh, Mr. A.P. Singh, Mr. Jamie Willoughby, (Sindicatum) Mr. Umesh Sahadev (Sindicatum) and Dr. G.S.C Rao after signing the joint-venture agreement.

Vol. 6, No. 4, October-December 2011

SIMBHAOLI SUGARS

Specialty Sugars Potable Liquor Ethanol Power

The Simbhaoli Sugar and Brijnathpur Sugar units started crushing operations from 28th October and 2nd November, 2011 respectively. Following a traditional prayer ceremony, the crushing operations at Simbhaoli plant were officially set into motion by Mr. Gurmit Mann, Chairman and Managing Director.

After a successful launch in the southern states, Xing Green Apple has been introduced in Haryana. Earlier this year, Simbhaoli Sugars, one of the oldest IMFL players in the country had successfully launched lemon flavour vodka (under the Xing brand) in the Haryana market. The USP of Xing Lemon is its smoothness and distinct flavour. The initial feedback from the market (trade and consumers) has been very positive.

Xing Lemon and Green App le F l a voursLaunched i n Haryana

Sugar : 3800 MTENA : 3.80 lakh litres IMFL : 18000 cases

Exports for the quarter ended December, 2011

Traditional Prayer Ceremony Kicks OffNew Sugar Season

I N T E G R A T E D C A S E T E C H N E W S!

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!

Casetech team has been awarded an advisory contract for re-locating an Australian sugar mill to a new location in south-east Asia. The project involves assessing the condition of the plant and machinery and framing the most effective time and cost saving re-location strategy.

Besides overseas projects, Casetech is undertaking projects in India as well. Presently it is working on improving the process efficiency, reducing plant losses, correcting process heat circuit design and planning the capacity expansion in two OLAM Group sugar mills in Karnataka and Madhya Pradesh.

With an objective to curtail process loses, Casetech has carried out a back-end audit of a Sri Chamudeshwari Sugars sugar refinery.

Hats Off to the Simbhaoli Instrumentation Department!Their ingenuity saves the Company around ̀ 9.5 lac

Since it had been decided to have one control room for two boilers (80 TPH, 87 kg/sq.cm capacity), we had to shift one boiler to its new location. Micromex quoted ̀ 10.05 lac for the shifting operation on a turnkey basis.

However, the Instrumentation Department led by Mr. A.K. Dhyani, Manager and Mr. Vivek Pandey, Sr. Executive decided to take up the task themselves. Using old panels and available materials, they successfully completed the exercise, for just ` 45,000. Resulting in savings in excess of ̀ 9.5 lac.

Training and Development ActivitiesRegular training and development programmes for contract labour and regular employees were organized during the quarter ended December. The departments included security, production, sales, godown, technical and cane. For the quarter under review, 72 mandays of training were imparted to executive staff and 150 mandays of training to non-executive staff.

Christmas was celebrated with great enthusiasm and joy on 25th December. Children of the sugar and distillery divisions employees participated in skits, games and dances.

Christmas Celebrations at Simbhaoli

SIMBHAOLI SUGARS

Specialty Sugars Potable Liquor Ethanol Power

Vol. 6, No. 4, October-December 2011

I M F L N E W S

Verdict Promotion at Two Prominent Bars in Gurgaon

Trust Sipp and Trust Speciality Sugars

were promoted at the India International

Trade Fair held at Pragati Maidan.

A dedicated stall was set up for the

purpose. The event marked special

sampling and promotional offers, which

elicited a favourable response from the

general public.

S U G A R N E W S Gur Purab Celebrationsat Simbhaoli

The 346th birth anniversary of Tenth Sikh Guru and founder of Khalsa Panth, Guru Gobind Singh was celebrated with great enthusiasm in Gurudwara Sahib, Simbhaoli Sugar Complex. Bhog, Sri Akhand Path, Kirtan and Guru Ka Langar were organized for all the devotees.

IMFL sales touch a new high in HaryanaNovember, 2011 saw IMFL sales climb to an all-time high in the highly competitive and saturated market of Haryana. A record 5,200 cases of IMFL products were sold in the state.

A special sales promotion campaign for Carnival rum and Board’s Verdict whiskey retailers paid huge dividends. The first prize was an all-expenses paid foreign holiday.

Mr. S.K. Sinha, Head-IMFL presented a Let ter o f Appreciation to Mr. Angad Singh, Marketing Manager, who has been instrumental in establishing Simbhaoli IMFL brands in Haryana.

Vol. 6, No. 4, October-December 2011

Please mail your suggestions to harmeet@simbhaolisugars.comHarmeet Kaur, Gursimran Kaur, Gopalkrishna Iyer, K.K. Tyagi

Editorial & Design : spawncommunications@gmail.comEditorial Team :

3rd Floor, E-13/29, Harsha Bhawan, Middle Circle, Connaught PlaceNew Delhi 110001 India Tel: +91-11-43214100

E-mail: info@simbhaolisugars.com Website: www.simbhaolisugars.com

SIMBHAOLI SUGARS

India’s largest integrated sugar refinerySimbhaoli Brijnathpur Chilwaria

An ISO 9000:2008, 14001:2004 & 22000:2005 Certified Company

Training Programme, BrijnathpurGeneral Manager (Co-generation) Brijnathpur, in association with Thermodyne Technologies organized a 3-day workshop on ‘Design Aspects of Boilers and its Operations’ for senior engineers, graduate engineer trainees, diploma engineer trainees and boiler operating staff of all the group companies. 56 employees from Simbhaoli, Chilwaria and Brijnathpur participated in the workshop. The objective was to enhance their knowledge and skill sets in the field of boiler operation and maintenance. The feedback of the training programme was extremely positive.

“The conventional definition of management is getting work done through people, but real management is developing people through work.” Contributed by Kamal Samtani, Company Secretary

A f r e e C h r o n i c Obstructive Pulmonary Diseases (COPD) health camp was organized for Company employees and people of adjoining villages at Chilwaria on 30th September. The day-long camp was sponsored by CIPLA and organized by Dr. Narendra Singh.

COPD Health Camp, Chilwaria

Mr. Gurmit Mann, Mr. Gurpal

Singh, Dr. G.S.C. Rao and Ms.

Gursimran Kaur joined senior

executives and staff members for

lunch on the eve of the New Year

at the Corporate Office.

New Year’s Eve Party at Corporate Office

VISITORS

New Year’s Eve Celebrations, Simbhaoli Plant

4th International Sugar Conference DelegatesThe 4th International Sugar Conference (ISC-2011) was held in New Delhi from 21-25th November, 2011. ISC delegates from more than 30 countries visited the Simbhaoli Sugar Complex on 25th November. The delegates visited the sugar plant, distillery, cane farms and experimental fields. The visit ended with a cultural programme featuring professional artists and children of Simbhaoli employees.

Children’s Day was celebrated on 14th November in association with State Bank of India. Contests and skill games were organized for the children of Simbhaoli employees. The event was rounded off with a prize distribution ceremony and l ight refreshments for the participants.

Children’s Day Celebrations, Simbhaoli

Training Programme for Cane DepartmentAn ISO awareness programme was organized for 80 cane department employees at Workers Club, Simbhaoli on 25th November. The main objective of the programme was to familiarize the participants about different ISO standards - ISO 9001, ISO 14001 and ISO 22000. Simbhaoli’s ISO management representative, Mr. Rooprajinder Singh conducted the training workshop.

Additionally, Dr. Ashok Tomar conducted a cane quality workshop for the above employees.

SindicatumMr. David Raubeinheimer

of Sindicatum along with

Mr. A.P. Singh, General

Manager, Co-generation

visited the Chilwaria

sugar complex.