I have great pleasure in presenting to you the 17th annual report of
 your Company.  the year that went by has been generally uneventful.
 though USA is on the path of recovery, unemployment and other problems,
 still plague the country. Europe has had its share of worries with
 financial meltdown in PIIGS countries hounded the entire Global
 economy, albeit temporarily.  Growth of Asian economies and their fast
 paced turnaround is heartening and holds hope for all concerned.
 
 Indian story though is spectacular. GDP growth is heart-cockling and
 India is seen as a rising super power in the times to come. However,
 the growth is uneven. While as few states are doing extremely well,
 there are a few states who are laggards and are languishing. What India
 needs is an all round inclusive growth and not the growth in few
 pockets of society. the surfacing of scams of huge magnitudes recently
 is a matter of shame and regardless of who they are, the guilty must be
 exposed and should be handed over exemplary punishment.
 
 Sugar Industry:
 
 The sugar industry globally is on a roller-coaster ride. After two
 years of defcit production, sugar stocks stand depleted. the global
 sugar balance continues to be tight and weather has impacted sugar
 production in key sugar geographies. Volume of sugarcane milled may not
 reach the ambitious projection made earlier. production in India holds
 the key for world sugar balance. polices of Indian Government in
 allowing export of sugar out of India would play a significant role.
 
 let me jog your memory and recapitulate chronologically the unfolding
 of events during the year which saw wild swings in the fortunes of
 those associated with the Industry.
 
 Heavy rainfall in south Central region Brazil had already dented the
 sugarcane production in Brazil. Indian sugar season started with a
 prediction of sugar production of 15 million tons. the union Government
 also introduced path breaking concept of Fair & Remunerative price
 (FRP) for sugarcane in lieu of the historical SMP. the intention of
 Government was noble as SMP over a period of time had lost its
 relevance and for many states it was merely a number. Central
 Government announced F & R p of Rs 129.84 linked to a recovery of
 9.50%. However state government of Uttar Pradesh in the meantime
 announced SAP of Rs 165 per quintal.  the farmers launched an agitation
 and virtually laid a seize over the national capital demanding price of
 Rs 280 per quintal.
 
 The Uttar Pradesh sugar Manufactures Association in the meantime
 announced a price of Rs 190 per quintal which included incentive of Rs 25
 per quintal. though crushing started what followed thereafter was an
 act of virtual hara-kiri by sugar mills as mills competed with one
 another to pay higher price for cane procured.
 
 production estimate of 15 million tons gained credence and was
 considered sacrosanct. Domestic sugar prices zoomed to a high of Rs
 4,200 per quintal in January, 2010 while international price of raw
 sugar skyrocketed to a historical high of 33 cents per pound as India
 was seen as a potentially big importer.
 
 Threat of lower sugarcane availability, higher international prices and
 higher domestic prices resulted in frenzied clamor for sugarcane and
 all mills competed with one another in paying higher and higher price
 for sugarcane.  unscrupulous poaching of sugarcane from areas of other
 sugar mills became rampant. Mere rumor that the price has been
 increased by one sugar mills sparked further price war and the effect
 was cascading. eventually, sugarcane prices stayed put at elevated
 levels. While higher sugarcane price got established, the domestic
 prices started tumbling. It dawned on the country that the production
 of sugar was in fact not so low but reasonable. unabated import sugar
 also flooded the sugar important. More importantly Central Government
 fearing political backlash on account of higher food infation indulged
 in political posturing and initiated a series of measures which dealt
 brutal blow to the market sentiments and the price of sugar were on a
 downward spiral thereafter.
 
 When the crushing season ended, actual production numbers were at huge
 variance with the estimates. Indian sugar production was 18.8 million
 tons, more than 25% of the estimated production of 15 million tons.
 Import of raw sugar couple with higher production tilted the Indian
 Sugar balance and in what was expected to be defcit year turned out to
 be not defcit at all. While the sugar price fall gathered momentum,
 sugarcane price had already fastened at a level of Rs 250 per quintal.
 Resultantly the pockets of sugar industry developed huge fissures and
 their economics are in a state of disarray.
 
 Few developments have been thought provoking and needs industrys
 introspection. Firstly, the authenticity of the estimates: Year after
 year, it has been proved the production estimates are not credible and
 have more often than not gone haywire. secondly, the lack of discipline
 on the part of industry: little did the industry realize the high
 sugarcane price payment started in the middle of season was
 irreversible. thirdly, poaching of sugarcane is a myopic strategy:
 Eventually, cane development alone will bear sustainable benefits.
 There are lessons for those of us in the industry to learn, to do soul
 searching and see that the gaffes are not repeated least they will
 torment the industry for all times to come. there is no grudging the
 fortune of farmers who have received higher price for their produce. In
 fact their interests and their development & prosperity are integral
 and crucial for the growth of industry. Without the well being of
 farmers, the industry cannot thrive. However, what is required is long
 term cohesive policy and not spurts of high payments in one year and
 defaults in another year.
 
 It is difficult to prophesize the outcome of the season 2010-11. While
 the Global sugar balance is again expected to be tight as the
 production of sugar in most countries has suffered for one reason or
 the other, there is buoyancy in India. production in India is estimated
 to be about 25.5 million and tons and the Indian sugar balance
 comfortable.  Global sugar prices though are on a high and breached all
 historical highs. prices which had touched a high of 33 cents per pound
 in January, 2010 started falling rapidly. However, there is resurgence
 in sugar price globally and the price presently prevailing is again 33
 cents per pound for raw sugar and in excess of 800 USD per ton of white
 sugar. In the meantime, the state Government of Uttar Pradesh has
 announced SAP of Rs 205 per quintal for the year 2010-11.
 
 There indeed is a strong case for allowing exports. In the absence of
 credible estimates of sugar production for the year 2010-11, Government
 wanted to tread cautiously and therefore made a small yet decisive
 beginning by announcing export of 500,000 tons of sugar. However, the
 recent rise in price of onions and tomatoes and food inflation in
 excess of 18% has once again compelled to the Government to rethink on
 allowability of exports. least the export of sugar stokes domestic
 sugar prices and thereby fuel further inflation, the Government has
 kept the matter of import in abeyance and has referred the matter to
 empowered Group of Ministers.
 
 In the aftermath of food inflation, the issue of deregulation is once
 again swept under the carpet, though the time was most opportune for
 implementing deregulation. From the industry perspective, the business
 of sugar has become fait-accompli business. on the buy side, state
 Government decides at what price sugarcane will be produced and what
 will be the area from which sugarcane will be procured. on the sell
 side, Central Government decides the quantity of sugar that each sugar
 mill will sell every month. the industry operates in a water tight
 situation. the situation is complicated by the requirement that
 industry must subsidize the sale of sugar in public Distribution
 system. 10% of production of every sugar mill is required to be offered
 for PDS at significantly below cost of production. There is neither
 scope for smart buying nor scope for smart selling. sugar perhaps
 remains the only regulated industry in the Country.
 
 Certain factors assume critical importance for the growth of the
 industry. they are:
 
 1.  Having credible estimates of production so that policy makers can
 frame policies for the growth of the industry.
 
 2.  stopping diversion of sugarcane for alternative sweetners such as
 Jaggery and Khandasari. While production of Jaggery and Khandasari
 sugar are a national waste and cause huge drag on the national
 exchequer, diversion of sugarcane to them leads to misleading estimates
 of sugar production
 
 3.  Doing away with the requirement of subsidizing sugar for PDS.
 
 4.  Deregulation: Deregulation of industry is the only long-lasting
 solution for the problems engulfng the industry. While deregulation
 will encourage effciency, it will separate the chalk from cheese as the
 ineffcient sugar companies will be weeded out from business. Industry
 will then be able to plan long term and execute the plans accordingly.
 
 5.  linking of sugarcane price to that of sugar: this is a time tested
 formula followed successfully in many countries.  It needs to be
 replicated in India.
 
 6.  Focus on cane development: Mills should focus on cane development
 and should channelize their resources for enduring benefits rather than
 frittering them away for short term gains, such as poaching of
 sugarcane from neighboring sugar mills.
 
 7.  Improve efflciency at plant levels and increase recovery and help
 farmers improve yield of sugarcane at farm levels. Improvement in farm
 yields will help sugar industry to optimally utilize their capacity.
 Interests of sugar mills and farmers are complementary to each other.
 together they can prosper and not at the cost of one another.
 
 DWARIKESH PERFORMANCE :
 
 The year gone by was a difficult year. While it started on a promising
 note it ended on a dismal note. A very simple number crunching will
 succinctly sum up the operations of the year. You Company crushed 1.9
 million tons of sugarcane. While the SAP announced was Rs 165 per
 quintal, UPSMA decided to pay Rs 190 per quintal. However, eventually
 industry ended up paying on an average Rs 250 per quintal of sugarcane.
 extra payment made per quintal of sugarcane when translated for the
 total quantity of sugarcane crushed out to a mind boggling number and
 sums up the story very candidly.
 
 Quarterly results have witnessed wild swings. While the first quarter
 was the best, the last quarter exactly the opposite.  Factors and
 circumstances were beyond control and only thing under control was
 efficiency and it is a matter of pride that we have been efficient in
 operating our plants. DN plant once again held the coveted position of
 clocking the highest recovery in the state of Uttar Pradesh. Recovery
 at Dp plant also is among the highest. efforts are made on large scale
 to improve the recovery at DD plant. While the plant is among the best
 in the country, the varietal sugar balance is being changed and efforts
 are made to help farmers grow improved variety of sugarcane. efforts
 and resources are dedicated to DD unit so that it is also in the same
 league as other plants.
 
 Your Company is continuing to focus on power generation and is
 developing power as an important driver its business module. there is
 already a paradigm shift in the business module of the Company and
 contribution power revenue in revenue stream of the Company is
 handsome.
 
 CONClUDING NOTE
 
 I take this opportunity to thank all our members of the staff, our
 bankers and all officials for their co-operation extended during the
 year. on behalf of the Board, let me assure all stakeholders that we
 continue to strive hard with shareholders interest in the forefront
 and I am confdent of enriching your worth in the years to come.  
 
 
                                                          Thank you.
 
                                                    Gautam R. Morarka
 
                                     (Chairman and Managing Director)