K M Sugar Mills Ltd

Overview

• Distillery Division to be demerged into a new company, which becomes a wholly owned subsidiary.

Rationale

• Consolidates distillery operations into a separate entity for focus and value unlocking.

Key Terms

• Nature: demerger of a division into a new company.
• Appointed Date: 01-Apr-2026 (effective date upon completion).
• Related party: Resulting Company becomes wholly owned subsidiary.
• Approvals: NCLT sanction; regulatory observations resolved; no exchange objections recorded.

Financial Impact

• Share entitlement: 1 new Rs10 share in Resulting Company for every 5 Rs2 shares in Demerged Company.
• Formation: new equity issued; Resulting Company becomes wholly owned subsidiary.
• Assets and liabilities of the Demerged Undertaking transferred to the Resulting Company.
• Tax considerations: department observations addressed; taxes payable as per law.

Stakeholder Impact

• Shareholders: receive equity in the Resulting Company; ownership via the new entity.
• Creditors: rights preserved; tax and liability matters addressed under the scheme.
• Employees: transfer to Resulting Company with no service interruption.
• Operations: Distillery Division activities continue under the new entity; structure streamlined.

Status & Next Steps

• Status: NCLT sanction granted on 19.08.2026; order binding from Appointed Date.
• Next steps: file revised MOA/AOA; register with ROC; align tax/regulatory filings.
• Effective date will be the completion date after the second motion order.

Scheme overview

• Demerger of the Distillery Division from the existing company to the resulting company.
• NCLT has sanctioned the scheme; order pronounced on August 19, 2026.
• Order copy awaited; effective date not disclosed.
• Purpose: reorganize to separate distillery business into a standalone entity.

Financial performance

• Standalone Q1 FY27: revenue from operations 18,993 lakhs; total income 19,390; PAT 783; EPS 0.85.
• Tax: current 261, deferred 33; total tax 294; PAT after tax 783.
• QoQ: revenue from operations rose to 18,993 from 10,599; PAT declined to 783 from 924.

Segment performance

• Sugar revenue 16,912; Distillery 2,880; total segment revenue 19,792; inter-segment 799; total revenue from operations 18,993.
• Segment PBT: Sugar 1,192; Distillery 242; total 1,434; PBT before tax 1,077; finance costs 357.
• Segment assets: Sugar 52,518; Distillery 9,167; total 61,690; segment liabilities 21,718.

Consolidation & governance

• Board approved unaudited standalone and consolidated results for quarter ended 30 June 2026.
• Limited review by Mehrotra & Mehrotra; Lucknow; dated 07 Aug 2026.
• KM Spirits & Allied Industries Limited appears in consolidation; results not material.

Operational context

• Sugar is a seasonal industry; quarterly performance can vary materially.

Regularisation of Naina Jhunjhunwala as Director

• Regularisation of Naina Devi Jhunjhunwala as Director approved at AGM 28 July 2026.
• Mother of MD Aditya Jhunjhunwala and JMD Sanjay Jhunjhunwala.
• Not debarred from holding office by SEBI or any authority.

Naina Jhunjhunwala appointed Whole-Time Director

• Appointed as Whole-Time Director for 3 years from 01.08.2026.
• Appointment approved by AGM 28-07-2026; BM held 18.05.2026.
• Related to MD Aditya and JMD Sanjay as mother.

Aditya Jhunjhunwala re-appointed MD

• Re-appointed as Managing Director for three years from 01.04.2027.
• NRC recommended; AGM approved 28.07.2026.
• Profile: 35 years in sugar and power; former president of Indian Sugar Mills Association.
• Son of Naina Devi Jhunjhunwala; brother of Sanjay Jhunjhunwala.
• Not debarred from SEBI order.

Sanjay Jhunjhunwala re-appointed Joint-Managing Director

• Re-appointed as Joint-Managing Director for three years from 01.04.2027.
• Profile: Oversees the Distillery Unit; 27+ years in sugar industry.
• Related to Naina as mother and Aditya as brother.
• Not debarred from SEBI order.

S. C. Aggarwala re-appointed ED cum CEO

• Re-appointed as ED cum CEO for three years from 01.04.2027.
• Profile: Science graduate and NSI sugar technologist; with KM Sugar since 2001.
• Not related to any Director or KMP.
• Not debarred from SEBI order.

Remuneration terms for Vatsal Jhunjhunwala

• Change in terms of appointment for Vatsal Jhunjhunwala as Vice President.
• Remuneration up to INR 10 lakh per month.
• Related party: Son of the Managing Director.

Continuation of Sushil Solomon as NED

• Continuation as Non-Executive Independent Director; age 75 on 21.12.2026.
• Term extended to 05 August 2029.
• Not related to Directors or KMP.
• Profile: 37 years in sugar research; multiple awards.

AGM Details

• Date and time: 28 July 2026 at 11:30 AM via video conferencing.
• Mode: Video Conferencing or other audiovisual means.
• Voting cut-off date: 21 July 2026.
• Remote e-voting window: 25–27 July 2026.
• Attendance: 76 joined; 48 remote votes; 1 via VC.

Resolutions put to vote

• Resolution 1: Adopt audited standalone and consolidated financial statements (Ordinary).
• Resolution 2: Ordinary appointment of director by rotation.
• Resolution 3: Ordinary appointment of director by rotation.
• Resolution 4: Special: Naina Devi Jhunjhunwala appointed Director (Additional).
• Resolution 5: Special: Naina Devi Jhunjhunwala as Whole-Time Director.
• Resolution 6: Special: Aditya Jhunjhunwala as Managing Director re-appointed.
• Resolution 7: Special: Sanjay Jhunjhunwala as Managing Director re-appointed.
• Resolution 8: Special: Subhash Chandra Aggarwala as Executive Whole-Time Director re-appointed.
• Resolution 9: Ordinary: Ratify remuneration of Cost Auditor for FY 2026-27.
• Resolution 10: Ordinary: Changes in terms/remuneration for Vatsal Jhunjhunwala (Vice President).
• Resolution 11: Special: Continue Sushil Solomon as Non-Executive Independent Director post 75.

Voting outcomes by resolution

• Resolution 1: Passed; 99.9994% in favour, 0.0006% against.
• Resolution 2: Passed; 99.9993% in favour, 0.0007% against.
• Resolution 3: Passed; 99.9993% in favour, 0.0007% against.
• Resolution 4: Passed; 99.9994% in favour, 0.0006% against.
• Resolution 5: Passed; 99.9994% in favour, 0.0006% against.
• Resolution 6: Passed; 99.8269% in favour, 0.1731% against.
• Resolution 7: Passed; 99.9993% in favour, 0.0007% against.
• Resolution 8: Passed; 99.9993% in favour, 0.0007% against.
• Resolution 9: Passed; 99.9994% in favour, 0.0006% against.
• Resolution 10: Passed; 99.8086% in favour, 0.1914% against.
• Resolution 11: Passed; 99.9993% in favour, 0.0007% against.

Directors/Remuneration changes

• Naina Devi Jhunjhunwala appointed Additional Director and Whole-Time Director.
• Aditya Jhunjhunwala re-appointed as Managing Director.
• Sanjay Jhunjhunwala re-appointed as Managing Director.
• Subhash Chandra Aggarwala re-appointed as Executive Whole-Time Director.
• Sushil Solomon to continue as Non-Executive Independent Director beyond age 75.

Auditor matters

• Remuneration of Cost Auditor for FY 2026-27 ratified.

AGM Details

• Date/time/mode: 28 July 2026, 11:30 AM, via VC/OAVM.
• Remote e-voting window: 25–27 July 2026.
• Voting cut-off for eligibility: 21 July 2026.

Ordinary resolutions

• Item 1: Adopt standalone and consolidated financial statements; approved.
• Item 2: Re-appoint Sanjay Jhunjhunwala as director; approved.
• Item 3: Re-appoint S. C. Aggarwala as director; approved.

Special resolutions - directors

• Item 4: Naina Devi Jhunjhunwala appointed Additional Director; May 18, 2026; approved.
• Item 5: Naina Jhunjhunwala appointed Whole-Time Director for 3 years from 01.08.2026; approved.
• Item 6: Aditya Jhunjhunwala re-appointed as MD for 3 years from 01.04.2027; approved.
• Item 7: Sanjay Jhunjhunwala re-appointed as Joint MD for 3 years from 01.04.2027; approved.
• Item 8: Subhash Chandra Aggarwala re-appointed as Executive Director/CEO for 3 years from 01.04.2027; approved.
• Item 11: Sushil Solomon continues as Non-Executive Independent Director beyond 75 until 2029; approved.

Auditors

• Cost auditor remuneration for FY2026-27 ratified.

Material related party transactions

• Item 10: Changes to terms/remuneration for Vatsal Jhunjhunwala; approved.

Dividend

• No dividend proposed or declared.

Other material approvals

• No ESOPs or other major corporate actions disclosed.

Meeting Details

• Date: 07 August 2026; Time: not disclosed; Location: Hotel Taj Mahal, Gomti Nagar, Lucknow.

Key Agenda Items

• Unaudited standalone and consolidated financial results for the quarter ended 30 June 2026.

Other Notes

• Trading window closed for Directors, Promoters, Officers and employees from 01 July 2026 until 48 hours after results.

CGM (Cane) appointment

• Type: Appointment; Person: Mr Pawan Kumar Chaturvedi; Role: Chief General Manager (Cane).
• Effective date: 10 July 2026.
• Term: not specified.
• Reason: Appointment.
• Profile: 30+ years in sugar industry; MBA and BSc.
• Relationships: Not Applicable.
• Board/committee impact: Not stated.

Dematerialisation/rematerialisation status

• Nil transfers processed during quarter ended 30 June 2026.
• No demat/remat requests received during quarter ended 30/06/2026.
• Securities dematerialised have been listed on the exchanges where the earlier issued securities are listed.
• Physical certificates received for dematerialisation were mutilated and cancelled; depository's name substituted as registered owner within prescribed timelines.
• No exceptions, delays, or non-compliance reported.