Dalmia Bharat Refractories Limited Unlisted Shares

Annual Report Summary

The document is the Annual Report for 2023-24 of Dalmia Bharat Refractories Limited (DBRL). It details the company's performance, strategic initiatives, and future outlook, along with financial statements and corporate governance disclosures.

CEO's Message: The CEO, Dr. C N Maheshwari, highlights a year of strategic transformation for DBRL. This includes optimizing the existing refractory business, acquiring Birla Tyre Limited, and proposing a scheme of arrangement for the demerger of the refractory and travel divisions of Dalmia Bharat Sugar and Industries Limited (DBSIL) into DBRL. The company aims to unlock new potential and enhance stakeholder value through these initiatives.

Company Overview: DBRL is undergoing a dynamic transformation, focusing on sustainable growth and shareholder value. Key strategies include:

• Optimizing the retained refractory business through the Salem plant and OCL China Limited.
• Reviving the tyre industry through the acquisition of Birla Tyre Limited and partnership with Himadri Speciality Chemicals Limited.
• Diversifying into a portfolio of quoted and unquoted securities to mitigate risk and generate long-term returns.
• A scheme of arrangement is proposed for the demerger of Dalmia Magnesite Corporation and Govan Travels from DBSIL into DBRL to streamline operations.

Management Discussion and Analysis: Highlights of 2023-24:

• Strategic exit from the German refractory business.
• Expansion through the acquisition of Birla Tyre Limited.
• A proposed scheme of arrangement to acquire Dalmia Magnesite Corporation and Govan Travels from DBSIL.
• Strategic investments in various quoted and unquoted securities.
• Active participation in bidding processes for mining of critical minerals.

Economic Outlook:

• The global economy experienced subdued growth amid persistent inflation, with the IMF projecting a 3.0% growth.
• The Indian economy defied global trends, with the Asian Development Bank projecting a robust 6.4% GDP growth.

Industry Structure and Developments:

• DBRL is focusing on its retained magnesia carbon business.
• It has entered the tyre industry through the acquisition of Birla Tyres Limited.
• The company is actively pursuing strategic investments in both publicly traded and privately held securities.

Opportunities, Risks, and Concerns:

• Opportunities exist in the growing magnesia carbon refractory and tyre industries, as well as in the Indian investment landscape.
• Risks include fluctuating raw material prices, intense competition, stricter regulations, and potential economic slowdowns.

DBRL's Operational & Financial Performance:

• On a standalone basis, revenue from continuing operations was ₹88.88 Crore, and profit after tax was ₹5.08 Crore.
• On a consolidated basis, revenue from continuing operations was ₹179.04 Crore, and profit after tax was ₹0.80 Crore.

Business Outlook:

• DBRL aims to capitalize on growth in the magnesia carbon business and revive operations at Birla Tyres Limited.
• The company will proactively address challenges and capitalize on its strengths for a sustainable future.

Internal Controls & Their Adequacy:

• The company has adequate internal financial controls.
• Transparency, compliance, and integrity are emphasized.

Human Resources:

• HR is considered a backbone for building a helpful environment.
• The company is focused on capability development and skilling.
• There were 39 employees as of March 31, 2024.

Director's Report:

• The Board approved a scheme of arrangement for the demerger of the refractory division and travel division of DBSIL into DBRL.
• The Company acquired 99.99% shareholding in Birla Tyre Ltd through the corporate insolvency resolution process.
• The Board recommends a dividend of 15% i.e. ₹1.50 per equity share.
• Rahul Sahni was appointed as Chief Financial Officer of the Company w.e.f April 21, 2023.
• The Company has four subsidiaries including one wholly owned and one step down subsidiary.
• The board remains committed to transparency and corporate governance.

Corporate Governance: The report details the company's commitment to ethical business practices, transparency, and stakeholder value enhancement.

Risk Management: DBRL assesses and manages risks through a systematic procedure, overseen by the audit committee.

Auditors' Report: The report includes the Secretarial Audit Report and the Statutory Auditors' Report, with no qualifications or adverse remarks.

Financial Statements: The document also includes standalone and consolidated financial statements. These detail the assets, liabilities, equity, revenue, expenses, and cash flows of the company and its subsidiaries.

Subsidiary Information: The report states information about various subsidiaries including OCL Global Limited, Himadri Birla Tyre Manufacturing Private Limited, Birla Tyres Limited and OCL China Limited.

Materiality: This summary captures the essential financial and strategic information needed to understand Dalmia Bharat Refractories' performance and future direction. It provides a comprehensive overview, meeting all the stated objectives and constraints.