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Directors Report of Ferro Alloys Corporation Ltd.

Mar 31, 2018

REPORT TO THE MEMBERS UNDER SECTION 134 OF THE COMPANIES ACT. 2013

We present the 62nd Annual Report of your Company and the Audited Financial Statement of the Company for the financial year ended 31st March, 2018, and the audited Consolidated Financial Statements of the Company for the Financial Year ended 31st March, 2018.

FINANCIAL RESULTS

Despite sluggish business phase during the year under review, the Company improved it bottom line numbers which is reflected in the financial results for the year which are, as under:

			(Rs. in lacs)
Particulars	Standalone		Consolidated
	For the year ended 31st March, 2018	For the year ended 31st March, 2017	For the year ended 31st March, 2018	For the year ended 31st March, 2017
Income from Operations	53908.25	61144.23	53908.25	61144.23
Profit before tax & Depreciation/Amortization	7062.70	4458.30	7051.31	4462.45
Depreciation/Amortization	575.05	663.06	575.05	663.06
Provision for taxation	939.48	1598.37	939.48	1598.37
Net Profit/(Loss) for the year	5492.29	1994.58	5480.90	1994.64
Balance carried to Balance Sheet	(1420.88)	(6969.05)	(1426.35)	(6963.13)

*Previous Year Figures have been regrouped/rearranged wherever necessary as the figures are rearranged/regroup due to IndAS.

During the year under review, revenue from operations decreased by 11.83% to ?53,908.25lacs (previous year Rs.61,144.23 lacs which includes Inter unit transfers of Rs.10,884.32 lacs). However, EBIDTA increased by 32.82% to Rs.8,049.18 lacs (previous year ?6,060.34 lacs) and profit after tax increased by 175.36% to Rs.5,492.29 lacs (previous year Rs.(1,994.58 lacs) on the back of improvement in prices .

STATE OF COMPANY''S AFFAIRS

Members may recall that the Company had executed Corporate Guarantee of Rs. 517.90 crores, in tranches, to Rural Electrification Corporation Limited which had sanctioned a Term Loan of Rs. 517.90 crores to Facor Power Limited, the then subsidiary of the Company against the security of the assets of FPL, the personal guarantee of two of its directors and the Corporate Guarantee of Ferro Alloys Corporation Limited, as aforesaid.

Members may recall that pursuant to a default in the repayment of the instalments and interest on the loan as per the repayment schedule and upon an application filed by REC under section 7 of the Insolvency and Bankruptcy Code, 2016 with the National Company Law Tribunal, Kolkata, Corporate Insolvency Resolution Process was initiated against the Company w.e.f 6th July, 2017 and Mr. K.G. Somani was appointed as Resolution Professional.

As reported last year, an appeal against the order of Hon''ble NCLT, Kolkata was filed before the Hon''ble National Company Law Appellate Tribunal, New Delhi (NCLAT, New Delhi) which was heard from time to time with the last hearing done on 5th March, 2018. The order is awaited.

Members may note that since Hon''ble NCLAT, New Delhi had not, during the hearings conducted before it, stayed the order of the Hon''ble NCLT, Kolkata, the Resolution Professional had, in compliance with the provisions of the Insolvency and Bankruptcy Code, 2016 and the Corporate Insolvency

Regulations, 2016 invited expression of interest from eligible bidders, who submitted the bids in accordance with the norms set out by the Committee of Creditors after due deliberations. However, none of the bids tendered were accepted by the Committee of Creditors and accordingly the NCLT, Kolkata had been informed that none of the bids received had been accepted by the Committee of Creditors, on 2nd April, 2018.

Although in terms of the provisions of Insolvency and Bankruptcy Code, 2016 the 270 days'' period for Corporate Insolvency Resolution Process got over on 2nd April, 2018, the said NCLT, Kolkata, vide its order 2nd April, 2018 directed Resolution Professional to continue with the management of the affairs of the Company. Further, post 2nd April, 2018 also the matter has been heard subsequently as well by NCLT, Kolkata but final decision in the matter has not been taken in view of the direction from Hon''ble NCLAT, New Delhi in its order dated 5th March, 2018 that any order passed shall be subject to decision of the appeals filed before it.

COMPANY OPERATIONS AFTER APPOINTMENT OF RESOLUTION PROFESSIONAL

The performance of the Company''s Charge Chrome Division and Mining Division during the year under the management of Resolution Professional has been satisfactory which is best demonstrated, as under:

Particulars	FY 2017-18 (w.e.f July, 2017 to March 18)	FY 2016-17
Ferro Chrome
Production in MT	53,728	69,370
Sales in MT	54,249	68,449
Chrome Ore
Production in MT	1,03,381	89,499

Further, the Resolution Professional continues to manage the affairs of the Company post 2nd April, 2018 in terms of the order dated 2nd April, 2018 of the Hon''ble NCLT, Kolkata. During the quarter ended 30th June, 2018, the performance of the Company has been, as under:

			(Rs. in lacs)
Sr.No.	Particulars	Quarter ended 30th June, 2018	Quarter ended 30th June, 2017
1.	Revenue from operations	15297.17	14476.53
2.	Expenses	13617.73	12325.19
3.	EBITDA	2229.67	2312.96
4.	Tax expense	684.88	(34.86)
5.	Net profit	1138.90	3805.56*

* Includes exceptional gain of Rs.2484.01 lacs arising due to sale of fixed assets.

INDUSTRIAL SCENARIO

India is currently the world''s 3rd largest producer of crude steel and is expected to become the 2nd largest producer of crude steel in the world soon. The country is also the 3rd largest consumer of finished steel (83.5 million tonnes in 2016) in the world preceded by China (681.0 million tonnes in 2016) and the USA (91.6 million tonnes in 2016). During January-December 2017, the country''s crude steel production crossed the 100 million tonnes mark for the first time in history, reaching 101.371 million tonnes (provisional; source: JPC), a growth of 6.18% over same period of 2016.

Steel is the most versatile material, which has made the progress in every aspect on this earth possible. There are hundreds of varieties of steel because for each application it has to be made with specific properties to get the most optimum usage. Though the basic constituent of steel is iron, it is the proportion of other elements in it, which gives each type of steel, certain specific properties. These elements are added in liquid iron in the form of Ferro alloys to get the desired composition and properties. Thus, Ferro alloys are important additives in the production of steel and Ferro Alloys industry is vitally linked for its growth and development to that of the Steel Industry.

In the backdrop of the industry''s scenario as above, your company''s turnover for the current financial year, 2017-18 stands at Rs. 52610.47 lacs as against Rs. 60537.38 lacs including Inter unit transfers of Rs. 10884.32 lacs last year. Exports during the year were Rs. 30200.87 lacs. Further, your company has posted a profit before tax of Rs. 6487.65 lacs this year as against Rs. 3795.24 lacs in the previous year, reflecting a increase of 70.95%.

PROSPECTS

India is expected to overtake Japan to become the world''s second largest steel producer soon, and aims to achieve 300 million tonnes of annual steel production by 2025-30. India is expected to become the second largest steel producer in the world by 2018, based on increased capacity addition in anticipation of upcoming demand, and the new steel policy, which has been approved by the Union Cabinet in May 2017, is expected to boost India''s steel production.* Huge scope for growth is offered by India''s comparatively low per capita steel consumption and the expected rise in consumption due to increased infrastructure construction and the thriving automobile and railways sectors.

Rise in infrastructure development and automotive production is driving growth in the sector. Power and cement industries also aiding growth in the metals and mining sector. Demand for iron and steel is set to continue, given the strong growth expectations for the residential and commercial building industry. India holds a fair advantage in cost of production and conversion costs in steel and alumina. It''s strategic location enables convenient exports to developed as well as the fast developing Asian markets. The Ministry of Steel aims to increase the steel production capacity to 300 million tonnes by 2030-31 from 128.28 million tonnes in 2016- 2017 indicating new opportunities in the sector. Under the Union Budget 2018-19, the Government added a surcharge of 10 per cent on aggregate duties of customs on imported goods to strengthen the domestic industry.

Government of India''s focus on infrastructure and restarting road projects is aiding the boost in demand for steel. Further, likely acceleration in rural economy and infrastructure is expected to lead to growth in demand for steel. The Union Cabinet, Government of India has approved the National Steel Policy (NSP) 2017, which seeks to create a globally competitive steel industry in India. NSP 2017 targets 300 million tonnes (MT) steel-making capacity and 160 kgs per capita steel consumption by 2030. Metal Scrap Trade Corporation (MSTC) Limited and the Ministry of Steel have jointly launched an e-platform called ''MSTC Metal Mandi'' under the ''Digital India'' initiative, which will facilitate sale of finished and semi-finished steel products. The Ministry of Steel is facilitating setting up of an industry driven Steel Research and Technology Mission of India (SRTMI) in association with the public and private sector steel companies to spearhead research and developmental activities in the iron and steel industry at an initial corpus of Rs 200 crore (US$ 30 million).

India has a significant profile in mining of chrome and production of ferrochrome. On the back of depressed market conditions, the production of chrome ore progressively came down in keeping with the policy to conserve the resource and mining disruptions due to court interventions and environment issues. In any case, India with chrome ore reserve of 70 million mt has only one per cent share of global proven deposit. Around 85 per cent of world reserve of this ore is found in South Africa and Zimbabwe. As a result, India is importing growing quantities of high grade chrome ore for blending with locally mined material.

FUTURE STRATEGY AND GROWTH

The period till 1947 thus witnessed a small but viable steel industry in the country, which operated with a capacity of about 1 million tonne and was completely in the private sector. From the fledgling one million tonne capacity status at the time of independence, India has now risen to be the 3rd largest crude steel producer in the world and the largest producer of sponge iron. As per official estimates, the Iron and Steel Industry contributes around 2 per cent of the Gross Domestic Product (GDP). From a negligible global presence, the Indian steel industry is now globally acknowledged for its product quality. As it traversed its long history since independence, the Indian steel industry has responded to the challenges of the highs and lows of business cycles.

India''s crude steel output grew 5.87 per cent year-on-year to 101.227 million tonnes (MT) in CY 2017. Crude steel production reached 93.183 million tonneduring April-February 2017-18. India''s finished steel exports rose 102.1 per cent to 8.24 million tonne, while imports fell by 36.6 per cent to 7.42 million tonnein 2016-17. Exports and Imports of iron and steel stood at 14.6 million tonneand 13.1 million tonneduring April-February 2017-18, respectively. Total consumption of finished steel stood at 81.943 million tonneduring April-February 2017-18.

Steel industry and its associated mining and metallurgy sectors have seen a number of major investments and developments in the recent past. According to the data released by Department of Industrial Policy and Promotion (DIPP), the Indian metallurgical industries attracted Foreign Direct Investments (FDI) to the tune of US$ 10.56 billion in the period April 2000-December 2017.

DIVIDEND

Keeping in view the future requirement of funds in working capital and other purposes, no dividend is recommended for the financial year ended 31st March, 2018.

FINANCE

Cash and cash equivalent as at March 31, 2018 was Rs. 1428.36 lacs. The Company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept understrict check through continuous monitoring.

DEPOSITS

The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies(Acceptance of Deposits) Rules, 2014.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Companies Act, 2013 and the implementation of Indian Accounting Standards (IND-AS) under Companies Act, 2013 on accounting and disclosure requirements and as prescribed by SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 the Audited Consolidated Financial Statements is provided in the Annual Report for the year except the subsidiary Facor Power Limited whose Management & Control have been taken over by Rural Electrification Corporation Limited w.e.f 7th November, 2017.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2018 was 1852.68 lacs. During the year under review, the Company has neither issued shares with differential voting rights nor granted stock options nor sweat equity.

INDUSTRIAL RELATIONS

Industrial relations with workers, trade unions, and with local populace remained amicable and pleasant throughout the year.

DIRECTORS

Mr.Vineetkumar Vithaldas Saraf shall retire by rotation at the ensuing 62ndAnnual General Meeting and, being eligible, offershimself for re-appointmentin accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company.

Further, all Independent Directors have given declarations that they meet the criteria of independence aslaid down under Section 149(6) of the Companies Act, 2013 and Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Company has formulated a code of conduct for all members of the Board and Senior Management Personnel. All concerned members/executives have affirmed compliance with the said code.

Detail of Remuneration paid to Executive Director during the year.

SI. No.	Name of Director	Total Remuneration
1	Mr. R. K. Saraf	1,05,45,715
2	Mr. Manoj Saraf	61,75,339
3	Mr. Ashish Saraf	-
4	Mr. Rohit Saraf	61,75,395

Detail of Remuneration paid to Non-Executive Directors during the year.

SI. No.	Name of Director	Sitting Fee Paid
1	Mr. A.S. Kapre	25,000
2	Mr. M.B. Thaker	30,000
3	Mr. Pinaki Misra	-
4	Mr. Umesh Khaitan	15,000
5	Mrs. Urmila Gupta	15,000
6	Mr. Vineet Saraf	-

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

All Independent Directors (IDs) inducted into the Board are given an orientation. Chairman & Managing Director and the Senior Management give an overview of the operations of the Company, to familiarise the new IDs with the Company''s business operations. The new IDs are given an orientation on the group structure, its operations, subsidiaries, Board constitution and procedures besides providing them with the financials of the Company for atleast 3 years and the corporate brochure etc. Also, plant visits are organized for each ID for familiarizing with the Company''s operations and facilities.

BOARD EVALUATION

In view of the initiation of the Corporate Insolvency Resolution Process against the Company w.e.f 6th July, 2017, the powers of the Board of Directors of the Company stand suspended in terms of the provisions of section 17 of the Insolvency and Bankruptcy Code, 2016 and the same stood vested in the Resolution Professional. Accordingly, the exercise of evaluation of the Board could not be taken up during the year under review.

NOMINATION AND REMUNERATION POLICY

The Board, on the recommendation of the Nomination & Remuneration Committee, has framed a Nomination and Remuneration policy for the appointment and remuneration of the Directors, Key Managerial Personnel and Senior Executives of the Company including criteria for determining qualifications, positive attributes, independence of a Director and other related matters which can be accessed at www. facorgroup.in/investorrelations. Further, the Policy was reviewed by the Committee and the Board at their meeting held on 13th May, 2017.

DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Ferro Alloys Corporation Limited, (FACOR), believes in equal employment opportunity and remains committed to creating and nurturing a working environment for all employees to enable them work without fear of any prejudice, gender bias and sexual harassment. The Company does not tolerate sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. During the Financial Year 2017-18, the policy was reviewed at the meeting of the Board of Directors of the Company held on 13th May, 2017. Further, during FY 2017-18, the Company has not received any complaint of sexual harassment.

MEETINGS

During the year under review only one meeting of the Board, Audit Committee, Nomination and Remuneration Committee, Shareholders'' Grievance Committee and the Corporate Social Responsibility Committee were convened and held, details whereof are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. Further, post initiation of Corporate Insolvency Resolution Process w.e.f 6th July, 2017 and suspension of the powers of the Board in terms of section 17 of the Insolvency and Bankruptcy Code, 2016, no meetings of the Board or Committees thereof have been held thereafter as all the powers of the board and/or its committees are being exercised by the Resolution Professional.

SUBSIDIARIES

The Report and Accounts of the Company are prepared in consolidated form and contains results of its subsidiaries Facor Realty and Infrastructure Limited and Facor Energy Limited. The annual accounts of the subsidiaries shall be available on request to the members of the Company and are available for inspection at the registered office of the Company. Further, the Consolidated Financial Statements presented by the Company include the financial results of the subsidiary companies.

The Consolidated Financial Statements have been prepared without the consolidation of Facor Power Limited (Subsidiary of the Company) as Rural Electrification Corporation Limited (REC) has taken over the management and control of Facor Power Limited by issuing a letter dated 7th November, 2017 under section 13(4)(b) of SARFAESI Act, 2002.

Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, the statement containing salient features of the financial statements of the Company''s Subsidiaries'', Associates'' and Joint Ventures (in Form AOC-1) is attached to the financial statements.

STATEMENT UNDER SECTION 134(5) OF THE COMPANIES ACT, 2013

On the basis of framework of internal financial controls established and maintained by the Company, the work performed by the internal, statutory, Cost and Secretarial auditors and external agencies, the reviews performed by Management, Mr. R.K. Saraf, Chairman & Managing Director of the Company has confirmed that the Company''s internal financial controls were adequate and effective as on 31 March, 2018 and that as required under section 134(5) of the Companies Act, 2013 it is confirmed:

(a) That in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) That we have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

(c) That proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) That the annual accounts have been prepared on a going concern basis;

(f) That proper internal financial controls were laid down by the company and that such internal financial controls are adequate and were operating effectively.

(f) That proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

AUDIT COMMITTEE

Audit Committee of the Company comprises of Mr. A.S. Kapre, Mr. M.B. Thaker, and Mr. Umesh Khaitan, all Independent Directors. The committee has been constituted in compliance with the provisions of Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [SEBI(LODR) Regulations, 2015] and assumes all responsibilities provided therein, discharging their duties diligently with transparency and accountability as their sole motivation. However, during the year under review, only one meeting of the Audit Committee was held on 13th May, 2017 as Corporate Insolvency Resolution Process was initiated against the Company w.e.f 6th July, 2017 and as a result, the powers of the Board and its committees stood suspended and vested in the Resolution Professional thereafter.

AUDITORS

Members of the Company, at the 61st Annual General Meeting of the Company had approved appointment of M/s K.K. Mankeshwar & Co. Chartered Accountants as the Statutory Auditor of the company from the conclusion of 61st Annual General Meeting till the conclusion of 66th Annual General Meeting (subject to the ratification at each annual general meeting held between the 61st Annual General Meeting and 66th Annual General Meeting, at a remuneration plus applicable taxes and reimbursement of expenses incurred by them incidental to their functions as may be decided by Interim Resolution Professional and/or the Board of Directors, as applicable. Accordingly, ratification of appointment of the Auditors is being put up for consideration and approval of the members of the Company as contained in the notice of the 62nd Annual General Meeting of the Company.

AUDITOR''S REPORT

The observations made in the Auditors'' Report are self-explanatory and therefore, do not call for any further comments u/s 134(3) of the Companies Act, 2013.

COST AUDITORS

The Resolution Professional has considered and decided the appointment of M/s Niran & Co., Cost Accountant (Registration No. 000113), as Cost Auditor of the Company for the financial year 2018-19 on a remuneration of Rs.70,000/- (Rupees Seventy Thousand only) per annum plus applicable taxes and out of pocket expenses and applicable taxes.

In accordance with the provisions of Section 148(3) of the Act read with the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors has to be ratified by the shareholders of the Company. It is therefore, necessary for the members to pass an Ordinary Resolution under section 148 and other applicable provisions, if any, of the Companies Act, 2013 as set out at Item no.4 of the Notice.

None of the Directors / Key Managerial Personnel of the Company / their relatives / Resolution Professional, is, in any way, concerned or interested, financially or otherwise, in the resolution set out at Item No. 4 of the Notice.

Further, the report on Cost audit for Financial Year ended 31st March, 2018 would be filed with Central Government in accordance with the timelines specified under the Companies Act, 2013.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Ashish Saxena & Company, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for financial Year 2018-19. The Report of the Secretarial Audit.for FY 2017-18, in Form MR-3 is annexed to this report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo, in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure ''A which forms part of this Report.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to this report.

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits set out in the said Rules forms part of the Report.

However, having regard to the provisions of the first proviso to Section 136(1) of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to the Members of the Company. The said information is available for inspection at Registered Office of the Company during working hours. Any member interested in obtaining such information may write to the Company Secretary, at the registered office and the same will be furnished on request. Further the details are also available on the Company''s website: www.facorgroup.in

CORPORATE GOVERNANCE

Corporate Governance in your Company is about Commitment to values, ethical business conduct, nurturing good business ethics and creating value for its stakeholders in line with the principles of fairness, equity, transparency, accountability and dissemination of information. Your Company''s efforts are driven by the fundamental objectives of maximizing value by employing resources in opportunities that generate consistent returns and position it for sustained growth.

In terms of Regulation 27 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate report on Corporate Governance, Management Discussion and Analysis along with your Company''s Statutory Auditors'' Certificate dated 14th August, 2018 confirming the above compliance is annexed to and forms part of the Directors'' Report.

HUMAN RESOURCE DEVELOPMENT

The Company takes great pride in the commitment, competence and vigour shown by its workforce in all realms of business and its commitment in the trying times, in particular. The Company continues to take new initiatives to further align its HR policies to meet the growing needs of its business.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed here withas "Annexure D".

SECRETARIAL AUDIT REPORT

In respect of observation Secretarial Auditor in his report, the management submits that the non-filing of some forms was by oversight. Further, the company is taking action to complete the filing requirement.

RELATED PARTY TRANSACTION

There have been no materially significant related party transactions between the Company and the Directors, the management, the subsidiaries or the relatives except for those disclosed in the financial statements.

Accordingly, particulars of contracts or arrangements with related parties referred to in Section 188(1) along with the justification for entering into such contract or arrangement in Form AOC-2 does not form part of the report.

PARTICULAR OF LOAN & INVESTMENT

There have been no transactions by the Company and the Directors, the management, the subsidiaries or the Resolution Professional except for those disclosed in the financial statements.

RISK MANAGEMENT POLICY

A company is exposed to uncertainties owning to the sector in which it is operating. The Company is conscious of the fact that any risk that could have a material impact on its business should be included in its risk profile. Accordingly, in order to contain / mitigate the risk, the Company has a Risk management policy approved by the Board. The Company''s Risk Management framework is designed to identify, assess and monitor various risks related to key business and strategic objectives and lead to the formulation of a mitigation plan. Major risks in particular are monitored regularly at Executive meetings and the Board of Directors of the Company is kept abreast of such issues and the Policy was reviewed by the Board at its meeting held on 13th May, 2017.

CORPORATE SOCIAL RESPONSIBILITY

Pursuant to Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, your Company approved a Policy on CSR and the Policy was parked on the website of the Company. As part of CSR initiatives, your Company during the financial year 2017-18 has amongst other activities, undertaken projects in areas of promoting healthcare, empowerment of woman, ecological balance. These projects are in accordance with Schedule VII of the Companies Act, 2013. The report on CSR activities is attached as Annexure to this Report

DISCLOSURE WHERE COMPANY IS REQUIRED TO CONSTITUTE NOMINATION AND REMUNERATION COMMITTEE:

The Company has constituted a Nomination & Remuneration Committee under Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, the Company has a Nomination & Remuneration Policy for appointment and remuneration of Directors Under Section 178 of the Companies Act, 2013 and Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. While terms of reference of the Committee include appointments of Directors as per the Nomination & Remuneration Policy of the Company, no new Director was appointed on the Board of Company during the year under review.

DISCLOSURE IF MD/WTD IS RECEIVING REMUNERATION OR COMMISSION FROM SUBSIDIARY COMPANY

As per Section 197(14) of the Act, 2013 A MD/WTD of company can receive remuneration or commission from any holding company or subsidiary company of such company. This should be disclosed by the company in Board''s Report.

s. No.	Name of Director	Total Remuneration including Perquisites & Allowance / Sitting Fee
1	Mr. Ashish Saraf, Joint Managing Director	5,000
2	Mr.A.S. Kapre, Independent Director nominated on the Board of Facor Power Limited till 7th November, 2017.	40,000

DISCLOSURE OF VIGIL MECHANISM IN BOARD REPORT

The Company has adopted the Vigil Mechanism Policy for the Company and the same is available on the website of the Company www.facorgroup.in

DETAILS OF DIRECTOR AND KMP

Pursuant to the provisions of section 2014 and other applicable provisions, if any, of the Companies Act, 2013 and the rules framed there under, Mr. R.K. Saraf, Chairman & Managing Director, Mr. Yashpal Mehta, Chief Finance Officer and Mr. Ritesh Chaudhry, Company Secretary are Key Managerial Personnel of the Company.

Further, neither any director has been appointed nor has any director resigned from the Board of the Company during the year under review.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Auditor reports to the Chairman of the Audit Committee of the Board.

The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal auditor, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board. However, during the year under review, the Internal audit reports were reviewed by the Resolution Professional in view of the suspension of the powers of the Board and its Committees pursuant to the provisions of section 17 of the Insolvency and Bankruptcy Code, 2016.

DISCLOSURE ABOUT ESOP AND SWEAT EQUITY SHARE

Company has not issued any share under ESOP or Sweat Equity Shares during the year.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

As reported last year, an appeal against the order dated 6th July, 2017 of the Hon''ble NCLT, Kolkata was filed before the Hon''ble National Company Law Appellate Tribunal, New Delhi (NCLAT, New Delhi) which was heard from time to time by the said NCLAT, New Delhi with the last hearing being held on 5th March, 2018. The order is awaited.

Although in terms of the provisions of Insolvency and Bankruptcy Code, 2016 the 270 days'' period for Corporate Insolvency Resolution Process got over on 2nd April, 2018, the said NCLT, Kolkata, vide its order 2nd April, 2018 directed Resolution Professional to continue with the management of the affairs of the Company. Further, post 2nd April, 2018, the matter has been heard subsequently as well by NCLT, Kolkata but final decision in the matter has not been taken in view of the direction from Hon''ble NCLAT, New Delhi in its order dated 5th March, 2018 that any order passed shall be subject to decision of the appeals filed before it.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year to which the financial statements related and the date of the report.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

In terms of Section 125 of the Companies Act, 2013, unclaimed or unpaid Dividends detailed, as under.are due for remittance on the dates specified below to the Investor Education and Protection Fund established by the Central Government.

â¢ Dividend for the year 2010-11, on or after 12th October, 2018

CAUTIONARY STATEMENT

Statements in the Board''s Report and the Management Discussion & Analysis describing the Company''s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the Statement. Important factors that could influence the Company''s operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

ACKNOWLEDGEMENTS

The Company thanks the Central and State Governments for their continued support and co-operation extended towards the business as well as the company''s social functions. The Management also thanks the shareholders, Business Associates, Financial Institutions & Banks, Customers and Suppliers for the faith reposed in the Company and in them and expresses its sincere appreciation to the dedicated and committed team of employees and workmen without whom reaching this far and maintaining the standard and quality of the products for which the company is famous, would not have been possible. The management also thanks the Resolution Professional and its team for the efforts put in sustaining the operations of the Company during the year without any hindrance.

By order of Resolution Professional,
for Ferro Alloys Corporation Limited
Ritesh Chaudhry
Sr. GM (Legal) & Company Secretary
K.G. Somani
Resolution Professional
Place : Dated :	Noida, 14th August, 2018

ANNEXURE ''A''

FORM AOC-1

Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014) Statement containing salient features of the financial statement of subsidiaries/ associate companies

Part A: Subsidiaries

1	SI. No.	1	2
2	Name of subsidiary	Facor Realty and Infrastructure Limited	Facor Energy Limited
3	Reporting period for the subsidiary concerned, if different from the holding company''s reporting period,	-	-
4	Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries.	-	GBP 92.06
5	Share Capital	10.00	184.12
6	Reserves & Surplus	(4.30)	(236.70)
7	Total Assets	5.88	0.42
8	Total Liabilites	5.88	0.42
9	Investments	-	-
10	Turnover	-	-
11	Profit before taxation	(0.06)	(11.33)
12	Provision for taxation	-	-
13	Profit after taxation	(0.06)	(11.33)
14	Proposed Dividend	-	-
15	% of shareholding	100%	100%

# Financial information is based on unaudited results.

Note :1. Due to loss of control and influence and curtailment of shareholder''s rights, Facor Power Limited has lost the status of Subsidiary Company of Ferro Alloys Corporation Limited, therefore, the information related to the same is not incorporated. 2. Both i.e. (1) Facor Realty and Infrastructure Ltd. ; (2) Facor Energy Ltd. have not commenced operations.

Part B : Associate Statement persuant to Section 129(3) of the Companies Act, 2013 related to Associate Company

S. No.	Name of Associate	Boula Platinum Mining Pvt. Ltd.
1	Last Audited Balance sheet date	31.03.2018
2	Share of Associate held by the company on the year end
	No.	466,164
	Amount of Investment in Associates (Rs. in lacs)	4.66
	Extend of Holding %	30%
3	Description of how there is significant influence	There is significant influence due to holding more than 20% Equity Share Capital
4	Reason why associate is not considered	-
5	Net Worth Attributable to Shareholding as per latest audited Balance Sheet (Rs. in lacs)	51.97
6	Profit/(Lossl for the year (Rs. in lacs)
	(i) Considered in Consolidation	0
	(ii) Not Considered in Consolidation	0

ANNEXURE ''B''

Form No. MR-3 SECRETARIAL AUDIT REPORT FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2018

Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To,

The Members,

Ferro Alloys Corporation Limited

D P Nagar Randia, Bhadrak

Orissa- 756135

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by FERRO ALLOYS CORPORATION LIMITED [CIN - L45201OR1955PLC008400] (hereinafter called the company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of the FERRO ALLOYS CORPORATION LIMITED''s books, papers, minute books, forms and returns filed and other records maintained by the company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit and to the best of our knowledge, we hereby report that in our opinion, the company has, during the audit period covering the financial year ended on 31st March, 2018 complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by FERRO ALLOYS CORPORATION LIMITED ("the Company") for the financial year ended on 31st March, 2018 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made there under;

(ii) The Securities Contracts (Regulation) Act, 1956 (''SCRA'') and the rules made there under;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (''SEBI Act''):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011; (No such disclosure received by the company during the audit period)

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992;

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; (Not applicable to the company during the audit period)

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999; (Not applicable to the company during the audit period)

(e) The Securities and Exchange Board of India (Issue and Listng of Debt Securities) Regulations, 2015; (Not applicable to the company during the audit period)

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; (Not applicable to the company during the audit period)

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998; (Not applicable to the company during the audit period) (vi) As informed to us the following other Laws are specifically applicable to the Company:

a) The Employees'' Provident Funds and Miscellaneous Provisions Act, 1952

b) Employees'' State Insurance Act, 1948

c) The Factories Act,1948

d) Equal Remuneration Act, 1976

e) The Payment of Wages Act, 1936

f) The Minimum Wages Act, 1948, and rules made there under

We have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India.

(ii) The SEBI (Listing Obligaitons and Disclosure Requirements) Regulations, 2015.

During the period under review the Company has generally complied with the provisions of the Act, Rules, Regulations,

Guidelines, Standards, etc. mentioned above subject to the following observation(s):

a) The Company is yet to file Form MGT-7 for the financial year ended 31.03.2017

b) The company is yet to file Form MR1, IEPF 1 and IEPF 2, in respect of the events occurred during the audit period. We further report that:

a) The company has given the corporate guarantee in respect of Term Loan obtained by M/s Facor Power Limited (hereinafter mentioned as borrower), from Rural Electrification Corporation Limited. Pursuant to a default in the repayment of the installments and interest by the borrower and upon an application filed by REC (the lender) under section 7 of the Insolvency and Bankruptcy Code, 2016 with the National Company Law Tribunal, Kolkata, Corporate Insolvency Resolution Process was initiated against the Company w.e.f 6th July, 2017 and Mr. K.G. Somani was appointed as Resolution Professional

b) Pursuant to initiation of Corporate Insolvency Resolution Process, powers of the Board of Directors stand suspended wef. 6th July 2017 and management of the company had been entrusted to the Resolution Professional, Mr. K. G. Somani wef. 6th July, 2017

Post initiation of Corporate Insolvency Resolution Process w.e.f 6th July, 2017 and suspension of the powers of the Board in terms of section 17 of the Insolvency and Bankruptcy Code, 2016, no meetings of the Board or Committees thereof have been held thereafter as all the powers of the board and its committees are being exercised by the Resolution Professional

The Board of Directors of the Company is, otherwise, duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. No change in the composition of the Board of Directors took place during the period under review.

Adequate notice was given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, in respect of the meeting held during the audit period, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

All decisions of the board, in respect of the meeting held during the audit period, were unanimous and recorded as part of the minutes. Further, with the vesting of the power of the Board w.e.f 6th July, 2017, all management decisions have been taken by the Resolution Professional.

We further report that there are systems and processes in the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines. However, there is scope to improve these control and compliance systems through use of Compliance Software and tools.

On the basis of information provided, we further report that during the audit period there were no instances of:

a. Public/Right/Preferential issue of shares / debentures/ sweat equity

b. Redemption / buy-back of securities

c. Merger / amalgamation / reconstruction, etc.

d. Foreign technical collaborations

For Ashish Saxena & Co Company Secretaries

(Ashish Saxena) Proprietor

FCS - 6560 CP - 7096 Dt.: 13/08/2018 Place: Ghaziabad

Note : This report is to be read with our letter of even date which is annexed as ''ANNEXURE A and forms an integral part of this report.

''ANNEXURE A''

To,

The Members

FERRO ALLOYS CORPORATION LIMITED

D P Nagar Randia, Bhadrak

Orissa- 756135

Our report of even date is to be read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of the company. Our responsibility is to express an opinion on these secretarial records based on our audit.

2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provide a reasonable basis for our opinion.

3. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the company.

4. Where ever required, we have obtained the Management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. Our examination was limited to the verification of procedures on test basis.

6. The Secretarial Audit report is neither an assurance as to the future viability of the company nor of the efficacy or effectiveness with which the management has conducted the affairs of the company.

For Ashish Saxena & Co Company Secretaries

(Ashish Saxena) Proprietor

FCS - 6560 CP - 7096 Dt.: 13/08/2018 Place: Ghaziabad

ANNEXURE ''C''

Additional information as required under Section 134(3)(m) read with Rule 8(3) of Companies (Accounts) Rules 2014.

A CONSERVATION OF ENERGY:
a)	Measures Taken	Conservation of Energy is an ongoing process. Efficient electric equipments and other measures taken in recent past have brought down energy consumption. However, it is difficult to quantify the same and/or assess its impact on cost of production.
b)	Additional investment and proposals if any being implemented for reduction of consumption of energy
c)	Impact of measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods.
d)	Total energy consumption and energy consumption per unit of production in prescribed form ''A.	Form ''A is not applicable to Ferro Alloys Industry.
B) TECHNOLOGY ABSORPTION:
Research & Development (R&D):
a)	Specific areas in which R&D carried out by the company	R&D in the operation of Ferro Chrome Production and manufacturing of briquettes is again a continuous process. Studies to recover the maximum entrapped metal from the discharged slag are in progress.
b)	Benefits derived as a result of the above R&D
c)	Future Plan of action	(i) The Company is analyzing and experimenting different methods of briquetting to cut down cost of production.
		(ii) Slag Utilisation and Waste Management.
d)	Expenditure on R&D	Recurring expenditure on R&D has been shown under respective heads of accounts in Profit & Loss Account.
e)	Technology absorption, adaptation and innovation:
	i) Efforts, in brief, made towards technology absorption, adaptation and innovation.	Not applicable since no new technology has been adopted
	ii) Benefits derived as a result of the above efforts, e.g. product improvement, cost reduction, product development, import substitution etc.	Not applicable
	iii) Information regarding technology imported during last 5 years	No technology has been imported during the last five years.
C) FOREIGN EXCHANGE EARNINGS AND OUTGO:
1)	Activities relating to exports, initiatives taken to increase exports, development of new export markets for products and services; and export plans	To explore new avenues of exports and to understand latest developments in the international markets, your directors undertake foreign tours as and when required.
2)	Total Foreign Exchange used and earned	Rs. in lacs
	i) CIF value of imports	465.27
	ii) Expenditure in Foreign currency	463.80
	iii) Foreign exchange earned on FOB basis	27145.04

ANNEXURE ''D''

Information pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

(1) Ratio of the remuneration of each Director/KMP to the median remuneration of all the employees of the Company for the financial year:

Median remuneration of all the employees of the Company for the Financial Year 2017-18	Rs.4,39,945
The percentage increase in the median remuneration of employees in the Financial Year	8.13%
The number of permanent employees on the rolls of Company as on 31 March, 2018	714

Name of Director	Ratio of remuneration to median Remuneration of all employees
Independent Directors
Mr. A.S. Kapre	0.06 : 1
Mr. Umesh Khaitan	0.03 : 1
Mrs. Urmila Gupta	0.03 : 1
Mr. M.B. Thaker	0.07 : 1
Executive Directors
Mr. R.K. Saraf	24.39 : 1
Mr. Manoj Saraf	14.45 : 1
Mr. Rohit Saraf	14.79 : 1

Notes:

1. The ratio of remuneration to median remuneration is based on remuneration paid during the period 1stApril, 2017 to 31st March, 2018.

(2) Relationship between average increase in remuneration and company performance:

a) The average increase in remuneration during Financial Year 2017-18 was 3.87% as compared with previous financial year. Net revenues of the Company during the financial year stood at Rs.539.08 crores as against Rs. 611.44 crores in the previous year.

b) The total employee cost for the Financial Year ended 31 March, 2018 was Rs.43,46,24,591 against Rs.41,84,44,027 for the Financial Year ended 31 March, 2017. The total employee cost as a percentage of net revenues was 8.06% (last year 6.84%).

(3) Comparison of the remuneration of the KMP against the performance of the Company:

(4) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

a) Average percentage increase in salary of the Company''s employees was 3.31%. The total managerial remuneration for the Financial Year 2017-18 was Rs. 269.01 lacs as against Rs. 237.86 lacs during the previous year.

b) The percentage increase in remuneration was, as under:

Mr. R.K. Saraf- Chairman & Managing Director - During the Financial Year 2017-18 was approximately 13.74% as compared to the previous financial year.

Mr. Manoj Saraf- Managing Director - During the Financial Year 2017-18 was approximately 9.34% as compared to the previous financial year.

Mr. Rohit Saraf-Joint Managing Director- During the Financial Year 2017-18 was approximately 11.09% as compared to the previous financial year.

(5) Comparison of the each remuneration of the KMP against the performance of the Company:

Particulars of Remuneration	Key Managerial Personnel
	Mr. R.K. Saraf	Mr. Yashpal Mehta	Mr. Ritesh Chaudhry
Remuneration in FY 17-18 (Rs crores)	1.07	0.43	0.26
Revenue (Rs crores)	539.08	539.08	539.08
Remuneration as % of Revenue	0.20	0.08	0.05
Profit before Tax (PBT) (Rs crores)	64.88	64.88	64.88
Remuneration as % of PBT	1.65	0.66	0.40

Annexure ''E''

Form No. MGT-9

EXTRACT OF ANNUAL RETURN as on the financial year ended on 2017-18

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration)

Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

i)	CIN:	L45201OR1955PLC008400
ii)	Registration Date:	27th September, 1955
iii)	Name of the Company:	Ferro Alloys Corporation Limited
iv)	Category / Sub-Category of the Company:	Public Company/Limited by Shares
v)	Address of the Registered office and contact details:	D P NAGAR, RANDIA, BHADRA ORISSA-756135 Phone No. - 91 -6784-240320 Fax No.- 91-6784-240626 E-mail- [email protected] [email protected]
vi)	Whether listed company:	Yes
vii)	Name, Address and Contact details of Registrar and Transfer Agent	Beetal Financial & Computer Services Pvt. Ltd., Beetal House, 3rd Floor, 99, Madangir, Behind LSC, New Delhi-110062 Phone No. 91-11-29961281-83 Fax No. 91-11-29961284 E-mail: [email protected] [email protected]

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY:

All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-

No.

Name and Description of main products / services

NIC Code of the Product/ service

% to total turnover of the company

Ferro Chrome

27110

100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES -

S. No.	Name And Address Of The Company	CIN/GLN	Holding/ Subsidiary / Associate	% of shares held	Applicable Section
1	Facor Realty & Infrastructure Ltd.	U45208DL2007PLC167732	Subsidiary	100	2(87)
2	Facor Energy Limited, Guernsey	NA	Subsidiary	100	2(87)
3	Rai Bahadur Shreeram & Co. Pvt. Ltd.	U99999MH1953PTC021694	Associate	37.49	2(6)
4	Boula Platinum Mining Private Limited	U72900DL2008PTC180106	Associate	30	2(6)

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Share Holding

Category of Shareholders	No. of shares held at the beginning of the year 01.04.2017				No. of Shares held at the end of the year 31.03.2018				% Change during the year
	Demat	Physical	Total	% of Total Share	Demat	Physical	Total	% of Total Share	% Change during the year
A. Promoters
(1) Indian
a) Individual/ HUF	206,685	0	206,685	0.11	402,873	0	402,873	0.22	0.11
b) Central Govt.	0	0	0	0.00	0		0	0.00	0.00
c) State Govt.	0	0	0	0.00	0		0	0.00	0.00
d) Bodies Corp.	72,726,108	0	72,726,108	39.25	72,726,108	0	72,726,108	39.25	0.00
e) Banks/FI	0	0	0	0.00	0	0	0	0.00	0.00
f) Any Other	60,159,840	0	60,159,840	32.47	60,159,840	0	60,159,840	32.47	0.00
Sub-total (A)(1):-	133,092,633	0	133,092,633	71.84	133,288,821	0	133,288,821	71.94	0.11
(2) Foreign
a) NRI''s-lndividuals	196,188	0	196,188	0.11	0	0	0	0.00	-0.11
b) Others-Individuals	0	0	0	0.00	0	0	0	0.00	0.00
c) Bodies Corp.	5,639,215	0	5,639,215	3.04	5,639,215	0	5639215	3.04	0.00
d) Banks/FI	0	0	0	0.00	0	0	0	0.00	0.00
e) Any Other	0	0	0	0.00	0	0	0	0.00	0.00
Sub-total (A)(2):-	5,835,403	0	5,835,403	3.15	5,639,215	0	5639215	3.04	-0.11
Total Shareholding of Promoters (A) =(A) (1) (A)(2)	138,928,036	0	138,928,036	74.99	138,928,036	0	138,928,036	74.99	0.00
B. Public Shareholding
1. Institutions
a) Mutual Fund	1,780	0	1,780	0.00	1,780	0.00	1,780	0.00	0.00
b) Banks/FI	4,848	0	4,848	0.00	1636	0.00	1,636	0.00	0.00
c) Central Govt.	1,620	4,046	5,666	0.00	0	4,046	4,046	0	0.00
d) State Govt''s	34,020	0	34,020	0.02	34,020	0	34,020	0.02	0.00
e) Venture Capital Funds	0		0	0.00	0	0.00	0	0.00	0.00
f) Insurance Companies	1620	6,600	8,220	0.00	1620	6,600	8,220	0	0.00
g) Flls	0	120	120	0.00	0	0.00	120	0.00	0.00
h) Foreign Venture Capital Funds	0	0	0	0.00	0	0	0	0.00	0.00
i) Others (specify)	0	0	0	0.00	0	0.00	0	0.00	0.00
Sub-total (B)(1):-	43,888	10,766	54,654	0.02	39,056	10,646	49,822	0.03	0.01
2. Non-Institutions
a) Bodies Corp.
i) Indian	12,225,325	9,955	12,235,280	6.60	6,148,453	2,929	6,151,382	3.32	-3.28
ii) Overseas

Category of Shareholders	No. of shares held at the beginning of the year 01.04.2017				No. of Shares held at the end of the year 31.03.2018				% Change during the year
	Demat	Physical	Total	% of Total Share	Demat	Physical	Total	% of Total Share	% Change during the year
b) Individuals
i) Individual shareholders holding nominal share capital upto Rs. 1 lakh	25421491	645,403	26,066,894	14.07	31281002	638119	31,919,121	17.23	3.16
ii) Individual shareholders holding nominal share capital in excess of Rs. 1 lakh	5402102	0	5402102	2.92	4927792	0	4927792	2.66	-0.26
c) Others (specify)	2537971	42883	2580854	1.39	3240805	42271	3283076	1.77	0.38
Sub-total	45,586,889	698,241	46,285,130	24.98	45,598,052	683,319	46,281,371	24.98	0.00
(B)(2):-
Total Public Shareholding (B)=(B)(1) (B)(2)	45,630,777	709,007	46,339,784	25.01	45,637,108	693,965	46,331,193	25.01	0.00
C. Shares held by Custodian for GDRs & ADRs	0	0	0	0	0	0	0	0	0.00
Grand Total (A B C)	184,559,234	709,007	185,268,241	100	184,574,276	693,965	185,268,241	100	0.00

ii) Shareholding of Promoters

s. No.	Shareholder''s Name	Shareholding at the beginning of the year 01.04.2017			Shareholding the end of the year 31.03.2018			% change in shareholding during the year
		No. of shares	% of total Shares of the Company	% of Shares Pledged/ encumbered total shares	No. of shares	% of total Shares of the Company	% of Shares Pledged/ encumbered total shares	% change in shareholding during the year
1	Urmiladevi Narayandas Saraf	59,43,503	3.21	0	59,43,503	3.21	0	0
2	Anurag Murlidhar Saraf	48,21,854	2.60	0	48,21,854	2.60	0	0
3	Sushmadevi Vinodku-mar Saraf	43,67,086	2.36	0	43,67,086	2.36	0	0
4	Manjudevi Murlidhar Saraf	39,64,131	2.14	0	39,64,131	2.14	0	0
5	Mohinidevi Umashankar Saraf	38,74,617	2.09	0	38,74,617	2.09	0	0
6	Vanitadevi Vineetkumar Saraf	38,40,705	2.07	0	38,40,705	2.07	0	0
7	Promiladevi Ramkisan Saraf	22,10,328	1.19	0	22,10,328	1.19	0	0
8	Ramkisan Durgaprasad Saraf	22,10,327	1.19	0	22,10,327	1.19	0	0
9	Rohitkumar Narayandas Saraf	20,93,366	1.13	0	20,93,366	1.13	0	0
10	Sunandadevi Yogeshkumar Saraf	11,76,976	0.64	0	11,76,976	0.64	0	0
11	Ramadevi Manojkumar Saraf	15,55,581	0.84	0	15,55,581	0.84	0	0
12	Shailajadevi Ashishkumar Saraf	9,34,629	0.50	0	9,34,629	0.50	0	0
13	Ashishkumar Ramkisan Saraf	9,34,629	0.50	0	9,34,629	0.50	0	0
14	Manojkumar Umashankar Saraf	9,40,493	0.51	0	9,40,493	0.51	0	0
15	Sonal Ashimkumar Saraf	8,50,344	0.46	0	8,50,344	0.46	0

s. No.	Shareholder''s Name	Shareholding at the beginning of the year 01.04.2017			Shareholding the end of the year 31.03.2018			% change in shareholding during the year
		No. of shares	% of total Shares of the Company	% of Shares Pledged/ encumbered total shares	No. of shares	% of total Shares of the Company	% of Shares Pledged/ encumbered total shares	% change in shareholding during the year
16	Ashimkumar Ramkisan Saraf	8,50,344	0.46	0	8,50,344	0.46	0	0
17	Vineetkumar Vithaldas Saraf	5,14,118	0.28	0	5,14,118	0.28	0	0
18	Bimladevi Vithaldas Saraf	3,31,151	0.18	0	3,31,151	0.18	0	0
19	Vinodkumar Saraf	2,03,474	0.11	0	2,03,474	0.11	0	0
20	Murlidhar Durgaprasad Saraf	1,90,120	0.10	0	1,90,120	0.10	0	0
21	Saritadevi Sanjivkumar Saraf	76,758	0.04	0	76,758	0.04	0	0
22	Payal Murlidhar Saraf	31,280	0.02	0	31,280	0.02	0	0
23	Vibhav Vineetkumar Saraf	23,080	0.01	0	23,080	0.01	0	0
24	Preetidevi Rohitkumar Saraf	12,600	0.01	0	12,600	0.01	0	0
25	Yogeshkumar Umashankar Saraf	18,900	0.01	0	18,900	0.01	0	0
25	Aisha Ashishkumar Saraf	11,500	0.01	0	11,500	0.01	0	0
27	Madhuri Manojkumar Saraf	7948	0.00	0	7948	0.00	0	0
28	Sidharth Vineetkumar Saraf	39,731	0.02	0	39,731	0.02	0	0
29	Raghvendra Manojkumar Saraf	4,800	0.00	0	4,800	0.00	0	0
30	Narayandas Durgaprasadji Saraf	3,176	0.00	0	3,176	0.00	0	0
31	Sanjiv Narayandas Saraf	1,96,188	0.11	0	1,96,188	0.11	0	0
32	Madhavhari Yogeshkumar Saraf	89,618	0.05	0	89,618	0.05	0	0
33	Gautam Vinodkumar Saraf	45,898	0.02	0	45,898	0.02	0	0
34	Raghuhari Yogeshkumar Saraf	32,902	0.02	0	32,902	0.02	0	0
35	M/s. Gauri Sanjeev Saraf	4800	0.00	0	4800	0.00	0	0
36	Amla Saraf	23,183	0.02	0	23,183	0.02	0	0
37	Gaurav Vinodkumar Saraf	5,156	0.00	0	5,156	0.00	0	0
38	Sakhi Sanjeevkumar Saraf	5,128	0.00	0	5,128	0.00	0	0
39	R B Shreeram & Co. Pvt. Ltd.	6,94,48,883	37.49	0	6,94,48,883	37.49	3,90,00,000	0
40	Dass Papers Pvt. Ltd.	12,00,000	0.65	0	12,00,000	0.65	0	0
41	Shreeram Durgaprasad Ores Pvt. Ltd.	12,00,000	0.65	0	12,00,000	0.65	10,00,000	0
42	Suchitra Investments & Leasing Ltd.	5,67,041	0.30	0	5,67,041	0.30	0	0
43	Saraf Bandhu Pvt. Ltd.	2,35,200	0.13	0	2,35,200	0.13	0	0
44	GDP Infrastructure Pvt. Ltd.	56,840	0.03	0	56,840	0.03	0	0
45	Vidarbha Iron & Steel Co. Ltd	18,144	0.01	0	18,144	0.01	0	0
46	Globalscale Investment Limited	56,39,215	3.04	0	56,39,215	3.04	0	0
47	Manojkumar Saraf & Rohit Saraf, as trustee Oof FACOR Employees Welfare Trust	22,424	0.01	0	22,424	0.01	0	0
48	Ramkishan Durgaprasad Saraf, as Trustee od FAL Employees Welfare Trust	27,576	0.01	0	27,576	0.01	0	0

s. No.	Shareholder''s Name	Shareholding at the beginning of the year 01.04.2017			Shareholding the end of the year 31.03.2018			% change in shareholding during the year
		No. of shares	% of total Shares of the Company	% of Shares Pledged/ encumbered total shares	No. of shares	% of total Shares of the Company	% of Shares Pledged/ encumbered total shares	% change in shareholding during the year
49	Mohinidevi Umashakar Saraf Jtly with ManjudeviMurlidhar Saraf, on behalf of Premier Commercial Corp.	1,56,72,291	8.46	0	1,56,72,291	8.46	0	0
50	Vanitadevi Vineetkumar Saraf Jtly with Sunandadevi Yoges-hkumar Saraf, on behalf of Geedee Sales Services	12,00,000	0.65	0	12,00,000	0.65	0	0
51	Murlidhar Durgaprasad Saraf Jtly with Gaurav Vinod Saraf, on behalf of Deepee Sales Corporation	12,00,000	0.65	0	12,00,000	0.65	0	0
	Total	13,89,28,036	74.99	0	13,89,28,036	74.99	0	0

iii) Change in Promoters'' Shareholding (please specify, if there is no change)

s. No.		Shareholding at the beginning of the year		Cumulative Shareholding during the year
		No. of shares	% of total shares of the company	No. of shares	% of total shares of the company
	At the beginning of the year	-	-	-	-
	Data wise Increase/ Decrease in Promoters Shareholding during the year specifying the reasons for increase/decrease (e.g. allotment/transfer/bonus/ sweat equity etc):
	At the end of the year	-	-	-	-

iv) Shareholding Pattern of top ten shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

S. No.	Name	Shareholding at the Beginning of the year 01.04.2017		Cumulative Shareholding during the year 31.03.2018
		No. of shares	% of total shares of the company	No. of shares	% of total shares of the company
1	Queen Consultancy Services Pvt Ltd	14,17,623	0.77	14,17,623	0.77
2	Red Apple Financial Consultants Pvt. Ltd.	-	-	9,24,283	0.50
3	GN Financial Consultants Pvt. Ltd			9,16,874	0.49
4	Anil Agarwal	15,39,000	0.99	6,99,000	0.38
5	Aqua Financial Consultants Private Limited	5,79,172	0.31	10,37,727	0.56
6	Sagar Jalani	-	-	4,52,823	0.24
7	Suslil Kumar Jalani	4,20,000	0.23	4,20,000	0.23
8	Tapan Kumar Dev	-	-	3,86,712	0.21
9	Aroma Plantation Ltd.	2,64,988	0.14	3,64,402	0.20
10	Modex lnternnation Securities Ltd.	12,84,550	0.69	3,00,000	0.16

v) Shareholding of Directors and Key managerial Personal:

s. No.	Name of Director/KMP	Shareholding at the Beginning of the year		Cumulative Shareholding during the year
s. No.	Name of Director/KMP	No. of shares	% of total shares of the company	No. of shares	% of total shares of the company
1	Mr. R. K. Saraf	22,10,327	1.19	22,10,327	1.19
2	Mr. Manoj Saraf	9,40,493	0.51	9,40,493	0.51
3	Mr. Ashish Saraf	9,34,629	0.50	9,34,629	0.50
4	Mr. Rohit Saraf	20,93,366	1.13	20,93,366	1.13
5	Mr. A.S. Kapre	25,000	0.01	0.01	0.01
6	Mr. M.B. Thaker	5,294	0.00	5,294	0
7	Mr. Pinaki Misra	0.00	0.00	0.00	0
8	Mr. Umesh Khaitan	0	0	0	0
9	Mrs. Urmila Gupta	0	0	0	0
10	Mr. Vineet Saraf	5,14,118	0.28	5,14,118	0.28
11	Mr. Yashpal Mehat	0	0	0	0
12	Mr. Ritesh Chaudhry	0	0	0	0

vi) Indebtedness

Indebtedness of the company including interest outstanding/accrued but not due for payment

				(Rs. in Lacs
	Secured Loans excluding deposits	Unsecured Loans	Deposits	Total Indebtedness
Indebtedness at the beginning of the financial year i) Principal Amount ii) Interest Due but not paid iii) Interest Accrued but not due	8193.94 1.53	2931.53 14.62 16.69	0 0 0	11,125.47 16.15 16.69
Total (i ii iii)	8195.47	2962,84	0	11,158.31
Change in Indebtedness during the financial year i. Addition ii. Reduction	(6983.29)	(24.03)	0 0	(7007.32)
Net Change	(6983.29)	(24.03)	0	(7007.32)
Indebtedness at the end of the financial year i) Principal Amount ii) Interest Due but not paid iii) Interest Accrued but not due	1212.18	2719.00 203.12 16.69	0 0 0	3931.18 203.12 16.69
Total (i ii iii)	1212.18	2938.81	0	4150.99

vii) Remuneration of Directors and Key Managerial Personnel

A. Remuneration to Managing Director, Whole-time Director and/or Manager:

S. No.	Particulars of Remuneration	Name of MD/WTD/Manager
		R.K.SARAF	Manoj Saraf	Ashish Saraf	Rohit Saraf	Total Amount
1.	Gross Salary			-
	(a) Salary as per provisions contained in section 17(1) of Income Tax Act, 1961	13.93	14.66		14.40	42.59
	(b) Value of perquisites u/s 17(2) Income Tax Act, 1961	4.02	3.64		2.76	10.42
	(c) Profits in lieu of salary under section 17(3) Income Tax Act, 1961	-	-		-	-
2.	Stock Option	-	-	-	-	-
3.	Sweat Equity	-	-	-	-	-
4.	Commission	_	_	_	_	_
	- As % of Profit
	Others, specify
5.	Others, please specify	-	-	-	-	-
	Total (A)	17.95	17.90	17.16	17.26	53.01
	Ceiling as per the Act

Remuneration to other directors

S. No.	Particulars of Remuneration	Name of directors
S. No.	Particulars of Remuneration	Mr. A.S. Kapre	Mr.Pinaki Misra	Mr. Umesh Khaitan	Mrs. Urmila Gupta	Mr. M.B. Thaker
	1 . Independent Directors
	Fee for attending Board, Committee meetings	Rs. 25,000	-	Rs. 15,000	Rs. 15,000	Rs. 30,000
	- Commission	-	-	-	-	-
	- Others, Please specify	-	-	-		-
	Total (1)	Rs. 25,000	Rs. 20,000	Rs. 15,000	Rs. 15,000	Rs. 30,000
	2. Other Non-Executive Directors
	- Fee for attending Board, Committee meetings	-	-	-	-	-
	- Commission	_	_	_	_	_
	- Others, Please specify	-	-	-	-	-
	Total (2)	-	-	-	-	-
	Total (B)=(1 2)	Rs 25,000	Rs. 20,000	Rs. 15,000	Rs. 15,000	Rs. 30,000
	Total Managerial Remuneration
	Overall Ceiling as per the Act

s. No.	Particulars of Remuneration	Name of directors
s. No.		Mr. Vineet Saraf
	1. Independent Directors
	- Fee for attending Board, Committee meetings	_
	- Commission	_
	- Others, Please specify	-
	Total (1)	-
	2. Other Non-Executive Directors
	- Fee for attending Board, Committee meetings	-
	- Commission	_
	- Others, Please specify	-
	Total (2)	-
	Total (B)=(1 2)	-
	Total Managerial Remuneration
	Overall Ceiling as per the Act

C. Remuneration to Key Managerial Personnel Other than MD/WTD/Manager

S. No.	Particulars of Remuneration	Key Managerial Personnel
		CEO	Company Secretary	CFO	Total
1.	Gross Salary
	a. Salary as per provisions contained in section 17(1) of Income Tax Act, 1961		20.15	33.85	54
	b. Value of perquisites u/s 17(2) Income Tax Act, 1961		2.64	6.87	9.51
	c. Profits in lieu of salary under section 17(3) Income Tax Act, 1961		~	~	~
2.	Stock Option		-	-	-
3.	Sweat Equity		-	-	-
4.	Commission
	- As % of Profit		.	.	.
	- Others, specify		-	-	-
5.	Others, please specify		-	-	-
	Total (A)		22.79	40.72	63.51

viii. Penalties/Punishment/Compounding of Offences:

There have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations. However, members'' attention is drawn to the statement on contingent liabilities, commitments in the notes forming part of the Financial statements.

Annexure ''F''

ANNUAL REPORT ON CSR ACTIVITIES TO BE INCLUDED IN THE BOARD''S REPORT OF FERROALLOYS CORPORATION LIMITED FOR FY 2017-18

Sr.No.	Particulars	Remarks
1	A brief outline of the Company''s CSR policy, including overview of projects or programs proposed to be undertaken and a reference to the web-link to the CSR policy and projects or Programmes.	The Company has framed Corporate Social Responsibility Policy and is guided by its social responsibility towards the society, in general and environment, in particular and remains committed to its further development. The Company promotes projects that are in line with Schedule VII to the Companies Act, 2013 and:
		â¢ are sustainable and create long term change,
		â¢ Channelize resources & efforts towards making positive and sustainable contribution in social and economic development; and
		â¢ Align CSR practices & programs to complement and support the developmental priorities at local, state and national levels.
		The CSR activities of the Company are focused on the four broad themes with goals to improve overall socio-economic indicators of Company''s area of operation:
		â¢ Promoting healthcare, sanitation and making safe drinking water available;
		â¢ Employment enhancement through training and vocational skill development;
		â¢ Promoting education; and
		â¢ Ensuring sustainable environment
		The CSR Policy has been uploaded on the Company''s website: www.facoraroup.in
2	The Composition of the CSR Committee.	Mr. M.B. Thaker, Chairman
		Mr. R.K. Saraf, Member
		Mr. Manoj Saraf, Member
3	Average net profit of the Company for last three financial years	Rs. 1,893.86 lacs
4	Prescribed CSR Expenditure (two per cent of the amount as in item 3 above)	Rs. 37.88 lacs
5	Details of CSR spent during the financial year:
	a) Total amount to be spent for the financial year;	Rs. 39.44 lacs
	b) Amount unspent, if any;	Not applicable
	c) Manner in which the amount spent during the financial year is detailed below

(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)
SI.No.	CSR project or activity Identified	Sector in which the Project is covered	Projects or programs (1) Local area or other (2) Specify the State and district where projects or programs was undertaken	Amount outlay (budget) project or programs wise (Rs.in lacs)	Amount spent on the projects or programs Sub-head: (1) Direct expenditure on projects or programs (2) Overheads: (Rs. in lacs)	Cumulative expenditure upto the reporting period (Rs. in lacs)	Amount spent: Direct or through implementing agency*
a)	Promoting Healthcare	Healthcare	Keonjhar, Dhenkanal and Jajpur	25	25.97	25.97	Direct

b)	Making available safe drinking water	Healthcare	Bhadrak, Keonjhar, Dhenkanal and Jajpur	5	5.06	5.06	Direct
c)	Promoting Education, enhancing vocation skills especially among children	Promoting Education	New Delhi	5.13	5.34	5.34	Direct
d)	Plantation expense	Ecological balance	Bhadrak, Dhenkanal and Jajpur	1	1.09	1.09	Direct
e)	Rural Development Projects	Promoting Development	Jajpur	1.25	1.48	1.48	Direct
f)	Promoting Paralympic Sports	Promoting Sports	Bhadrak	.50	.50	.50	Direct
		TOTAL:		37.88	39.44	39.44	-
6.	In case the company has failed to spent the two percent of the average net profit of the last three financial years or any part thereof, the reasons for not spending the amount in its Board report.				Not applicable
7.	A responsibility statement of the CSR Committee that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and Policy of the company.				Since the power of the committee of the Board of Directors stand suspended by the virtue of provisions of Section 17 of the Insolvency and Bankruptcy Code, 2016, the Management of the Company confirms that the implementation and the monitoring of CSR Policy is in compliance with CSR objectives and Policy of the Company.

(Ram Kisan Saraf)	(Yashpal Mehta)	(Ritesh Chaudhry)
Chairman & Managing Director	Chief Financial Officer	Sr. G.M. (Legal) & Company Secretary
Place : Noida
Dated : 14th August, 2018

Mar 31, 2016

DIRECTORSâ REPORT TO THE MEMBERS

The Directors present the 60^th Annual Report of your Company and the Audited Financial Statement of the Company for the financial year ended 31^st March, 2016, and the audited consolidated financial statement of the Company for the Financial Year ended 31^st March, 2016.

FINANCIAL RESULTS

With adverse business phase during Year under review, the Company''s performance has been affected significantly which is reflected in the financial results for the year which are, as under:

STATE OF COMPANYâS AFFAIRS

It needs no reiteration that the fortunes of ferro alloys industry are saddled to that of the steel industry. In the current year, steel prices have been down by about 33% and consequently the fall in gross margins of steel producers, which has been alarming. In their drive to cut costs in every possible way and survive the depressed market conditions, steelmakers are bargaining hard while buying raw materials or intermediate products, including ferroalloys.

India has a significant profile in mining of chrome and production of ferrochrome. On the back of depressed market

('' in lacs)

Particulars	Consolidated		Standalone
Particulars	For the year ended 31^st March, 2016	For the year ended 31^st March, 2015	For the year ended 31^st March, 2016	For the year ended 31^st March, 2015
Income from Operations	57368.19	60,310.28	56933.35	60,270.18
Profit before tax & Depreciation/ Amortization	(3521.21)	(439.76)	(322.03)	2951.74
Depreciation/Amortization	2166.41	2178.74	467.66	495.63
Provision for taxation	(376.64)	549.50	(376.64)	549.50
Net Profit/(Loss) for the year	(5310.98)	(3168.00)	(413.05)	1906.61
Transfer to General Reserve	-	2100.00	-	2100.00
Balance carried to Balance Sheet	(12469.98)	(7159.00)	3953.94	4366.99

During the year under review, revenue from operations declined by 5.54% to Rs, 56,933.35 lacs (previous year Rs, 60,270.18 lacs). However, EBIDTA fell by 68.16% to Rs, 1,466.58 lacs (previous year Rs, 4,606.55 lacs) and profit after tax declined by 121.66% to Rs, (413.05) lacs (previous year Rs, 1,906.61 lacs) on account of difficult market conditions and decline in production.

Your Company is engaged mainly in the production of Ferro Chrome and with a dip in stainless steel production, the Company''s financials have been impacted due to weak realization. Further, rise in working capital requirement has kept the profitability and debt-servicing indicators stressed.

Shortall in chrome supply from company''s captive mines due to there being no mining operations at Company''s Kathpal mine, Boula mines compounded the problem of raw material availability. To meet out the requirement of its shortfall of Chrome ore, the Company has procured chrome ore from Orissa Mining Corporation and other mining companies also, which increased the cost of production. At the same time, sharp decline in sales realization during the year vis a vis relatively lesser reduction in raw material cost have compounded the problem further which is evident from the results for the year under review.

conditions, the production of chrome ore progressively came down from 3.3 million tonnes (mt) in 2005 to 2.8 mt in 2014 in keeping with the policy to conserve the resource and mining disruptions due to court interventions and environment issues. In any case, India with chrome ore reserve of 70 mt has only one per cent share of global proven deposit. Around 85 per cent of world reserve of this ore is found in South Africa and Zimbabwe. As a result, India is importing growing quantities of high grade chrome ore for blending with locally mined material.

In the backdrop of the industry''s scenario as above, your company''s turnover for the current financial year, 2015-16 stands at '' 56029.10lacs as against '' 59069.32lacs last year, an decrease of 5.15% over the previous year. Exports during the year were '' 22974.17 lacs. Further, your company has posted a profit/(loss) before tax of '' (789.69) lacs this year as against '' 2456.11lacs in the previous year, reflecting a decrease of 132.15%.

Although the Company''s operations have been closed at Boula mines following the order passed by the Hon''ble Supreme Court, the company is evaluating legal remedies to regain and restart the mining operations at the Boula mines. Further, the Company is in the process of finalizing a long term contract for supply of chrome ore. Although the supply contract is not for a substantial quantity, it should, nevertheless ease some strain on the chrome ore requirements of the Company.

PROSPECTS

High input costs, led by lower availability of ores and reluctant, and inadequate power supply are key risks faced by the ferro alloys industry. Non-availability of rail wagons for procuring raw materials and poor infrastructure facilities at ports are other issues that Indian ferro alloy manufacturers have to grapple with.

However, ferro chrome prices of late, have staged some recovery. Also, Stainless Steel Development Association announced that Indian stainless steel production will go up to 5.2 million tons in 2020. This is grossly up by 67.7% from 3.1 million tons expected in 2015, and according to the anticipation announced, the increasing trend will continue such as 3.6 million tons in 2016, 4.0 million tons in 2017, 4.3 million tons in 2018 and 4.7 million tons in 2019.

However, with an annual output of 1 mt, India figures prominently in the global chrome alloys industry and trade. Our stainless steel production being 3 mt, the domestic requirement of ferrochrome is about 460,000 tonnes, leaving us with an exportable surplus of half the alloy production.

Chinese Customs Tariff Commission of the State Council issued 2016 Import and Export Tariffs Schedules, which will be effective from January 1^st 2016. The export tariffs on ferroalloys products have been kept the same as that implemented in 2015. Chinese ferroalloys products have lost its price advantage in the international market due to the high export tariff during the past few years, and the export volume of Chinese ferroalloys has consequently declined sharply.

Stainless demand in general, however, remains a mixed bag. Demand is very weak in the oil country, especially with oil prices remaining at only about $40-$45/barrel and not expected to get above $60/barrel next year. But on the other hand, automotive sales - especially sales of pickup trucks and sport utility vans - are at 15 year highs and shipments of major home appliances are seeing nearly 10% year on year increases.

The government on August 4, 2016 extended minimum import price on 66 steel products and is also expected to levy an antidumping on other products. With this we expect prices in the domestic market to rise. However, given the demand-supply imbalance in the market we expect prices uptick to be marginal. Consequently, operating margins are expected to improve with higher realizations and lower raw material cost.

FUTURE STRATEGY AND GROWTH

The Company is also contemplating setting up an additional 27MVA furnace at the Company''s Charge Chrome Plant. Your company, thus, remains committed to forward integration as well by way of setting up green field projects, acquisitions, joint ventures etc.

Further, the captive power plant set by your company in Facor Power Limited, the subsidiary of the Company is supplying uninterrupted power to the Company and Balasore Alloys Ltd., a Ferro Alloys producer in Orissa on group captive basis and is also trying to tie up power sale for its balance power generation.

DIVIDEND

Keeping in view the future requirement of funds in working capital and other purposes, the Directors do not recommend any dividend in the financial year ended 31^st March, 2016.

FINANCE

Cash and cash equivalent as at March 31, 2016 was Rs, 244.72 lacs. The Company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring.

DEPOSITS

The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard 21 on Consolidated Financial Statements read with Accounting Standard 23 on Accounting for Investments in Associates, the audited consolidated financial statement is provided in the Annual Report for the year.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2016 was 1852.68 lacs. During the year under review, the Company has neither issued shares with differential voting rights nor granted stock options nor sweat equity.

INDUSTRIAL RELATIONS

Industrial relations with workers, trade unions, and with local populace remained amicable and pleasant throughout the year.

DIRECTORS

Mr. Ashishkumar Ramkisan Saraf shall retire by rotation at the ensuing 60th Annual General Meeting and, being eligible, offers himself for re-appointment in accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company.

During the year, Mr. Anurag Saraf was appointed as an Additional Director in the category of Non-Executive Director. However, his resolution for appointment as a Director liable to retire by rotation was not approved by the shareholders with requisite majority and as a result, he ceased to be the Director of the Company w.e.f 21^st September, 2015. Also Mr. S. B. Mishra an Independence Director Ceased to be a Director consequent upon his death on 12th August, 2016.

Further, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Company has formulated a code of conduct for all members of the Board and Senior Management Personnel. All concerned members/ executives have affirmed compliance with the said code.

Detail of Remuneration paid to Executive Director During the year.

(Rs, in lacs)

S. No.	Name of Director	Total Remuneration
1	Mr. R. K. Saraf	15,16,850.32
2	Mr. Manoj Saraf	17,99,783.32
3	Mr. Ashish Saraf	17,99,996.32
4	Mr. Rohit Saraf	17,99,997.32

Detail of Remuneration paid to Non-Executive Directors during the year.

(Rs, in lacs)

S. No.	Name of Director	Sitting Fee Paid
1	Mr. A.S. Kapre	80,000
2	Mr. M.B. Thaker	70,000
3	Mr. Pinaki Misra	20,000
4	Mr. Keshaorao Pardhi	40,000
5	Mr. Umesh Khaitan	10,000
6	Mrs. Urmila Gupta	40,000
7	Mr. S.B. Mishra	25,000
8	Mr. Vineet Saraf	50,000
9	Mr. Anurag Saraf	10,000

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

All Independent Directors (IDs) inducted into the Board are given an orientation. Chairman & Managing Director and the

Senior Management give an overview of the operations of the Company, to familiarize the new IDs with the Company''s business operations. The new IDs are given an orientation on the group structure, its operations, subsidiaries, Board constitution and procedures besides providing them with the financials of the Company for at least 3 years and the corporate brochure etc. Also, plant visits are organized for each ID for familiarizing with the Company''s operations and facilities.

BOARD EVALUATION

The Board evaluated the effectiveness of its functioning and of individual directors at its meeting held on 12th February, 2016.

The aspects covered in the evaluation included the contribution to and monitoring of corporate governance practices, participation in the long-term strategic planning and the fulfillment of Directors'' obligations and fiduciary responsibilities, including but not limited to, active participation at the Board and Committee meetings.

The Chairman had meetings with the Independent Directors and the Chairman of the Nomination and Remuneration Committee also had meetings with the Executive and Non Executive Directors. These meetings were intended to obtain Directors'' inputs on effectiveness of Board/Committee processes.

Further, the Independent Directors at their meeting, reviewed the performance of Board, Chairman of the Board and of Non- Executive Directors.

NOMINATION AND REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination and Remuneration policy for the appointment and remuneration of the Directors, Key Managerial Personnel and Senior Executives of the Company including criteria for determining qualifications, positive attributes, independence of a Director and other related matters can be accessed at www.facorgroup.in/investorrelations. Further, the Policy was reviewed by the Committee and the Board at their meeting held on 27th May, 2016.

DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Ferro Alloys Corporation Limited, (FACOR), believes in equal employment opportunity and remains committed to creating and nurturing a working environment for all employees to enable them work without fear of any prejudice, gender bias and sexual harassment. The Company does not tolerate sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. During the Financial Year 2015-16, the Company has not received any complaint of sexual harassment and the Policy was reviewed by the Board and Committee at its meeting held on 27th May, 2016.

MEETINGS

During the year Four Board Meetings, Four Audit Committee Meetings, One Shareholders'' Grievances Committee, One meeting of Nomination and Remuneration Committee and One meeting of Corporate Social Responsibility Committee were convened and held, details whereof are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

SUBSIDIARIES

The Report and Accounts of the Company are prepared in consolidated form and contains results of its subsidiaries, Facor Power Limited, Facor Realty and Infrastructure Limited and Facor Energy Limited. The annual accounts of the subsidiaries shall be available on request to the members of the Company and are available for inspection at the registered office of the Company. Further, the Consolidated Financial Statements presented by the Company include the financial results of the subsidiary companies.

DIRECTORSâ RESPONSIBILITY STATEMENT

On the basis of framework of internal financial controls established and maintained by the Company, the work performed by the internal, statutory, Cost and Secretarial auditors and external agencies, the reviews performed by Management and the relevant Board Committees, the Board, with the concurrence of the Audit Committee, is of the opinion that the Company''s internal financial controls were adequate and effective as on 31 March, 2016.

Accordingly, pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors to the best of their knowledge and ability confirm:

(a) That in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(d) That the annual accounts have been prepared on a going concern basis;

(f) That proper internal financial controls were laid down by the company and that such internal financial controls are adequate and were operating effectively.

(f) That proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

AUDIT COMMITTEE

Audit Committee of the Company comprises of Mr. A.S. Kapre, Mr. M.B. Thaker, and Mr. S.B. Mishra, all Independent Directors. The committee has been constituted in compliance with the provisions of Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [SEBI(LODR) Regulations, 2015] and assumes all responsibilities provided therein, discharging their duties diligently with transparency and accountability as their sole motivation.

AUDITORS

M/s Salve & Company, Chartered Accountants hold office upto the conclusion of the 61^st Annual General Meeting subject to their appointment being ratified at every intervening Annual General Meeting of the Company till 61^st Annual General Meeting of the Company. Based on the recommendation of the Audit Committee, the Board of Directors of the Company have proposed the ratification of appointment of M/s Salve & Co., Chartered Accountants, as the Auditors of the Company from the conclusion of the forthcoming 60th Annual General Meeting till the conclusion of the 61^st Annual General Meeting. M/s Salve & Co., have expressed their willingness to act as Auditors of the Company, if appointed, and have further confirmed that the said appointment would be in conformity with the provisions of Section 141 of the Companies Act, 2013.

AUDITORâS REPORT

The observations made in the Auditors'' Report are self explanatory and therefore, do not call for any further comments u/s 134(3) of the Companies Act, 2013.

COST AUDITORS

Pursuant to Section 141 & 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, appointed M/s Niran & Co. to audit the cost accounts of the Company for the financial year 2016-17. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member''s ratification for the remuneration payable to Messrs Niran & Co., Cost Auditors( Registration No. 000113) is included at Item No. 12 of the Notice convening the Annual General Meeting. M/ s Niran& Co., have expressed their willingness to act as Auditors of the Company, if appointed, and have further confirmed that the said appointment would be in conformity with the provisions of Section 141 of the Companies Act, 2013.

Further, your Directors had, in accordance with the General Circular from the Ministry of Corporate Affairs appointed M/ s Niran & Co., Cost Accountants, as Cost Auditors for Financial Year ended 31^st March, 2016, for which Central Government approval had been received by the Company. The report on Cost audit for Financial Year ended 31^st March, 2016 would be filed with Central Government before 30th September, 2016.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Ashish Saxena & Company, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for financial Year 2016-17. The Report of the Secretarial Audit in Form MR-3 is annexed to this report, as Annexure-A.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

PARTICULARS OF EMPLOYEES

CORPORATE GOVERNANCE

In terms of Regulation 27 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate report on Corporate Governance, Management Discussion and Analysis along with your Company''s Statutory Auditors'' Certificate dated 12^th August, 2016 confirming the above compliance is annexed to and forms part of the Directors'' Report.

HUMAN RESOURCE DEVELOPMENT

Your Company takes great pride in the commitment, competence and vigour shown by its workforce in all realms of business. The Company continues to take new initiatives to further align its HR policies to meet the growing needs of its business.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as âAnnexure Dâ.

SECRETARIAL AUDIT REPORT

In respect of observation made by the Secretarial Auditor in his report, the management submits that the non-filing of MGT- 14 was by oversight. Further, The Company is filing an application for condo nation of delay to complete the filing requirement.

PARTICULAR OF LOAN & INVESTMENT

During the year, the Company has remitted GBP 10,000 (INR 9,64,800) to Facor Energy Limited, Guernsey (FEL, Guernsey). However, allotment of shares to the Company is in process by FEL, Guernsey. Other than the above, no loans, guarantees given and investments have been made during the year in accordance with section 186 of the Companies Act, 2013 are, as under. Accordingly, the information is given below:

Rules, 2014, your Company approved a Policy on CSR and the Policy was parked on the website of the Company. As part of CSR initiatives, your Company during the financial year 2015-16 has amongst other activities, undertaken projects in areas of promoting healthcare, empowerment of woman, ecological balance. These projects are in accordance with Schedule VII of the Companies Act, 2013. The report on CSR activities is attached as Annexure - E to this Report

DISCLOSURE WHERE COMPANY IS REQUIRED TO CONSTITUTE NOMINATION AND REMUNERATION COMMITTEE:

The Company have constitute a Nomination & Remuneration Committee under Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

('' in lacs)

Name of the entity	Relation	Amount	Particulars of loans, guarantees given or investments made	Purpose for which the loans, guarantees and investments are proposed to be utilized
Facor Energy Limited	Wholly Owned Subsidiary	9.65	Investment *	Business purpose

* Shares yet to be allotted by Facor Energy Limited, Guernse

RELATED PARTY TRANSACTION

RISK MANAGEMENT POLICY

A company is exposed to uncertainties owning to the sector in which it is operating. The Company is conscious of the fact that any risk that could have a material impact on its business should be included in its risk profile. Accordingly, in order to contain / mitigate the risk, the Board of Directors have approved a Risk management policy which shall be reviewed by Board and the management from time to time. The Company''s Risk Management framework is designed to identify, assess and monitor various risks related to key business and strategic objectives and lead to the formulation of a mitigation plan. Major risks in particular are monitored regularly at Executive meetings and the Board of Directors of the Company is kept abreast of such issues and the Policy was reviewed by the Board and Committee at its meeting held on 27th May, 2016.

CORPORATE SOCIAL RESPONSIBILITY

Pursuant to Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) & Company have Nomination & Remuneration Policy for appointment and remuneration of Directors Under Section 178 of the Companies Act, 2013 and Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. All the appointments of Directors are as per the Nomination & Remuneration Policy of the Company, which were also approved by the Committee.

DISCLOSURE IF MD/WTD IS RECEIVING REMUNERATION OR COMMISSION FROM SUBSIDIARY COMPANY

(Rs, in lacs)

S. No.	Name of Director	Total Remuneration including Perquisites & Allowance/Sitting Fee
1	Mr. Ashish Saraf,
	Joint Managing Director	5,000
2	Mr. A.S. Kapre, Independent Director nominated on the Board of Facor Power
	Limited, subsidiary	40,000

DISCLOSURE OF VIGIL MECHANISM IN BOARD REPORT

The Company has adopted the Vigil Mechanism Policy for the Company in its duly held Board Meeting on 13th February, 2015 and the same is available on the website of the Company.

DETAILS OF DIRECTOR AND KMP

Pursuant to the provisions of section 2014 and other applicable provisions, if any, of the Companies Act, 2013 and the rules framed there under, Mr. R.K. Saraf, Chairman & Managing Director, Mr. O.P. Banka, Director (Finance) & Chief Finance Officer and Mr. Ritesh Chaudhry, Company Secretary have been appointed as the Key Managerial Personnel of the Company.

Further, details of directors who were appointed and/or who have resigned ceased to be Director are, as under:

S.	Name of Director	Date of Cessation
No.
1	Mr. Anurag Saraf,*	21^st September,
	Non-Executive Director	2015

* Represents Promoters

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

DISCLOSURE ABOUT ESOP AND SWEAT EQUITY SHARE

Company has not issued any share under ESOP or Sweat Equity Shares during the year.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

In terms of Section 125 of the Companies Act, 2013, unclaimed or unpaid Dividends detailed, as under, are due for remittance on the dates specified below to the Investor Education and Protection Fund established by the Central Government.

- Dividend for the year 2009-10, on or after 17^th October,2017

- Dividend for the year 2010-11, on or after 12^th October, 2018

CAUTIONARY STATEMENT

Statements in the Board''s Report and the Management Discussion & Analysis describing the Company''s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company''s operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

ACKNOWLEDGEMENTS

Directors of the Company wish to thank the Central and State Governments for their continued support and co-operation extended towards the business as well as the company''s social functions. The Management also thanks the shareholders, Business Associates, Financial Institutions & Banks, Customers and Suppliers for the faith reposed in the Company and in them. The Board expresses its sincere appreciation to the dedicated and committed team of employees and workmen without whom reaching this far and maintaining the standard and quality of the products for which the company is famous, would not have been possible. We look forward to all of your continued support. Let''s grow and move ahead together.

On behalf of Board of Directors,

Place : New Delhi R.K. SARAF

Dated : 12^th August, 2016 Chairman & Managing

Director

Mar 31, 2014

Dear members,

The directors are delighted to present the 58th Annual Report of your Company and the Audited Statement of Accounts for the year ended 31st March, 2014.

FINANCIAL RESULTS

The Board takes pleasure and pride to announce that despite sluggish business phase in the last Financial Year, the Company yet performed reasonably well to post positive figures for the year. The results are as under:

(Rs. in lacs)

Particulars For the For the year ended year ended 31st March, 2014 31st March, 2013

Profit before tax 4296.57 3094.59

Depreciation/Amortization 926.60 919.25

Provision for taxation 1160.28 515.47

Net Profit/(Loss) for the year 3136.29 2579.12

Transfer to General 5000.00 - Reserve

Balance carried to 4560.38 6424.09 Balance Sheet

OPERATIONS

The Indian ferro alloy industry has evolved gradually and now employs highly qualified manpower, latest equipments and technology. This evolution has led to quality produce which has strengthened its position over the years.

Reaching such position and earning recognition has not come easy for Indian ferro alloy industry given the fact that out of 12 billion tones of global reserves; about 95% of resources are geographically concentrated in Kazakhstan, South Africa, Turkey and other countries.

Notwithstanding the above, Indian chrome enjoys premium over others due to higher chrome content compared to glo- bal average and has higher Cr/ Fe ratio. Furthermore, Indian ores are also more amenable to beneficiation and upgradation than South African ores and because of the higher Cr/ Fe and higher Cr2O3, chrome alloys made from Indian ores have higher percent of chrome ore. South Africa is the largest chrome ore producer followed by Zimbabwe, Kazakhstan and India. Despite high grade of ores Indian Chrome falls short in competition owing to high input costs, escalating power tariff and unavailability of quality raw materials. Owing to the aforesaid factors Indian ferro alloys producers are operating at levels well below their installed capacity.

Your company''s turnover for the current financial year, 2013-14 stands at Rs. 63262.91 lacs as against Rs. 51787.13 lacs last year, an increase of 22.16% over the previous year. Exports during the year were Rs. 45483.70 lacs. Further, your company has posted a profit before tax of Rs. 4296.57 lacs this year as against. Rs. 3094.59 lacs in the previous year, reflecting an increase of 38.84%. DIVIDEND Keeping in view the future requirement of funds in working capital and other purposes, the Directors do not recommend any dividend in the financial year ended 31st March, 2014.

FINANCE

Your Company has not raised any deposit from public during the year.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard 21 on Consolidated Financial Statements read with Accounting Standard 23 on Accounting for Investments in Associates, the audited consolidated financial statement is provided in the Annual Report for the year.

PROSPECTS

Prospects of Ferro Alloys industry are saddled to the growth and progress of Steel Industry. With Steel Industry contributing substantially to the growth of Indian Economy, India has emerged as the 4th largest producer of crude steel in the world as against the 8th position it occupied in 2003and expects to become the 2nd largest producer of crude steel soon.

As per official estimates, the Iron and Steel Industry contributes close to 3 per cent of the Gross Domestic Product (GDP). World crude steel production stood at 1547.8 million tonnes during 2012, an increase of 1.2 per cent over 2011. During 2012, Chinese crude steel production reached 716.5 million tonnes, a growth of 3.1 per cent over 2011. Further, during FY 2012-13 India''s share in the production of High Carbon Ferro Chrome stood at 1.12 million tonnes.

China has remained the largest crude steel producer in the world, accounting for 72 per cent of Asian and 46 per cent of world crude steel production during 2012. With low per capita consumption of steel of 59 kg in India compared to the world average of estimated 200 kg there is a strong feeling that the domestic steel industry has a huge growth potential.

India, with 5-7% share of Global Ferro Alloys Industry, is amongst the ten largest producers of the material in the world. Indian Bulk ferro alloys supply constitutes of ferro chrome about 32%, ferro manganese and silico manganese about 62% and rest others. Further, Indian enjoys a natural advantage as it has the 5th largest chrome ore with 100 million tones estimated reserve and the 6th largest in Manganese ore with estimated 176 million tones reserve.

Total domestic consumption may reach 1 million metric tonnes by 2015 from about 4,50,000 tonnes, while output may rise at a slower pace of 44% to 1.3 million tones.

The Indian ferro alloy industry has, since inception, laid emphasis on research & development, backward integration in terms of setting up of captive power plants, operating mines, thereby creating large scale employment and bringing development to the local populace.

FUTURE STRATEGY AND GROWTH

With power being a major cost element in production of ferro chrome, your Company, as a measure for backward integration, is setting up a 100 MW Captive Power Plant. While phase-I (One Turbine of 50MW and One Boiler) and phase-II (2nd Turbine of 50MW and 2nd Boiler) have been completed, Commissioning of the third boiler is expected by October/ November, 2014.

Currently, the captive power plant is generating about 30-35 MW power as per the requirement of your Company.

Further, your company also remains committed to forward integration as well by way of setting up green field projects, acquisitions, joint ventures etc.

INDUSTRIAL RELATIONS

Industrial relations with workers, trade unions, and with local populace remained amicable and pleasant throughout the year.

DIRECTORS

Mr.Rohit Saraf and Mr. Ashish Saraf shall retire by rotation at the ensuing 58th Annual General Meeting and, being eligible, offer themselves for re-appointment.

The Company has formulated a code of conduct for all members of the Board and Senior Management Personnel. All concerned members/executives have affirmed compliance with the said code.

SUBSIDIARIES

The Report and Accounts of the Company are prepared in con- solidated form and contains results of its subsidiaries, Facor Power Limited, Facor Realty and Infrastructure Limited and Facor Energy Limited. The annual accounts of the subsidiaries shall be available on request to the members of the Company and are available for inspection at the registered office of the Company.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of Companies Act, 1956, your Directors confirm that -

i) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations;

ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) they have prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Audit Committee of the Company comprises of Mr A.S. Kapre, Mr M.B. Thaker, and Mr. S.B. Mishra, all Independent Directors. The committee has been constituted in strict compliance with the provisions of Clause 49 of the Listing agreement and assumes all responsibilities provided therein, discharging their duties diligently with transparency and accountability as their sole motivation.

AUDITORS

M/s Salve & Company, Chartered Accountants hold office upto the conclusion of the ensuing 58th Annual General Meeting. Based on the recommendation of the Audit Committee, the Board of Directors of the Company have proposed the appointment of M/s Salve & Co., Chartered Accountants, as the Auditors of the Company from the conclusion of the forthcoming 58th Annual General Meeting till the conclusion of the 61st Annual General Meeting. M/s Salve & Co., have expressed their willingness to act as Auditors of the Company, if appointed, and have further confirmed that the said appointment would be in conformity with the provisions of Section 141 of the Companies Act, 2013.

You are requested to appoint Auditors for the current year and to fix their remuneration.

AUDITOR''S REPORT

The observations made in the Auditors'' Report are self explanatory and therefore, do not call for any further comments u/s 217(3) of the Companies Act, 1956.

COST AUDITORS

Your Directors had, in accordance with the General Circular from the Ministry of Corporate Affairs appointed M/s Niran & Co., Cost Accountants, as Cost Auditors for Financial Year ended 31st March, 2014, for which Central Government approval had been received by the Company. The report on Cost audit for Financial Year ended 31st March, 2014 would be filed with Central Government before 30th September, 2014. Further, your Directors have appointed M/s Niran & Co., Cost Accountants, as Cost Auditors of the Company for Financial year ended 31st March, 2015 as well for which Central Government approval has also been received.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo, in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure ''A'' which forms part of this Report.

PARTICULARS OF EMPLOYEES

In terms of the provisions of section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of the employees are set out in the annexure to the Directors'' Report. Having regard to the provisions of section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company.

CORPORATE GOVERNANCE

In terms of clause 49 of the Listing Agreement, a separate report on Corporate Governance, Management Discussion and Analysis along with your Company''s Statutory Auditors'' Certificate dated 26th May, 2014 confirming the above compliance is annexed to and forms part of the Directors'' Report.

HUMAN RESOURCE DEVELOPMENT

Your Company takes great pride in the commitment, competence and vigour shown by its workforce in all realms of business. The Company continues to take new initiatives to further align its HR policies to meet the growing needs of its business.

ACKNOWLEDGEMENTS

Directors of the Company wish to thank the Central and State Governments for their continued support and co-operation extended towards the business as well as the company''s social functions. The Management also thanks the shareholders, Business Associates, Financial Institutions & Banks, Customers and Suppliers for the faith reposed in the Company and in them. The Board expresses its sincere appreciation to the dedicated and committed team of employees and workmen without whom reaching this far and maintaining the stan- dard and quality of the products for which the company is famous, would not have been possible. We look forward to all of your continued support. Let''s grow and move ahead together.

On behalf of Board of Directors,

R.K. SARAF CHAIRMAN & MANAGING DIRECTOR

Place : Noida - 201 301 Dated : 26th July, 2014

Mar 31, 2013

The directors are delighted to present the 57th Annual Report of your Company and the Audited Statement of Accounts for the year ended 31st March, 2013.

FINANCIAL RESULTS

The Board takes pleasure and pride to announce that despite difficult and testing times faced in the last Financial Year, the Company performed marvellously to post positive figures for the year. The results are as under:

(Rs. in lacs)

Particulars For the year For the year ended 31st ended 31st March, 2013 March, 2012

Gross Profit/(Loss) 4013.84 767.18

Depreciation/Amortization 919.25 975.86

Provision for taxation 515.47 131.54

Net Profit/(Loss) for the year 2579.12 (340.22)

Transfer to General Reserve

Balance carried to Balance Sheet 6424.09 3844.97

OPERATIONS

The Indian ferro alloy industry has evolved over time and now fosters highly qualified manpower, latest equipments and technology. This evolution has led to quality produce which has made its position as one of the best in the world.

Making that position and earning recognition has not been an easy task for Indian ferro alloy industry as out of 12 billion tones of global reserves; about 95% of resources are geographically concentrated in Kazakhstan, South Africa, Turkey and other countries.

The edge that Indian chrome en joys over others is that it has higher chrome content compared to global average and has higher Cr/ Fe ratio of 2.4 compared to 1.7. Furthermore, Indian ores are also more amenable to beneficiation and upgradation than South African ores and because of the higher Cr/ Fe and higher Cr 2O3, chrome alloys made from Indian ores have higher percent of chrome ore. South Africa is the largest chrome ore producer followed by India and Kazakhstan.

Despite high grade of ores Indian Chrome falls short in competition owing to high input costs, escalating power tariff and unavailability of quality raw materials. Owing to the aforesaid factors Indian ferro alloys producers are operating at 50% of their installed capacity (i.e. installed capacity is 1584000 tonnes whereas production was only 792000 tonnes). The average production of the Indian ferro alloys industry during the year was 2.4 Million tonnes with peak produce of 2.89 Million Tonnes, which represented 56% capacity utilization.

Your company''s turnover for the current financial year, 2012-13 stands at Rs. 51787.13 lacs as against Rs. 47604.17 lacs last year. Exports during the year saw a slight decline against last year. Further, your company has posted a profit before tax of Rs. 3094.59 lacs this year as against loss of Rs. 208.68 lacs in the previous year.

DIVIDEND

Keeping in view the future requirement of funds in working capital and other purposes, the Directors do not recommend any dividend in the financial year ended 31st March, 2013.

FINANCE

Your Company has not raised any deposit from public during the year.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard 21 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the financial year 2012-13.

PROSPECTS

The Indian ferro alloy industry has, since inception, laid emphasis on research & development, backward integration in terms of setting up of captive power plants, operating mines, thereby creating large scale employment and bringing development to the local popuilace. The prospects of ferro alloys industry are tied up to that of steel industry and swing in the direction the latter takes. However, despite measures to achieve cost efficiency by backward integration, the same could not be achieved, especially for units which have set up captive power units. This is due to the factor that the coal allocation for thermal plants have been lax, prices of imported coal has increased with Indonesia and Philippines imposing export duty on coal. The producers are currently operating at 50% capacity to minimize their losses due to escalating costs. The global demand is predominantly met by produce of South Africa and Kazakhstan with China being the largest importer of both chrome ore and ferro chrome. Further, the Euro Zone crisis, recessionary phase continuing in the US, tsunami in Japan and contraction in global auto sector has negatively impacted steel demand. However, projections and forecast for 2013 and 2014 remain promising with global consumption pegged to increase by 2.9% to 1454 million tonne and 3.2% to 1500 million tonne in 2014 as against 1.2% growth of 2012. Apparent steel use in China is expected to grow by 3.5% in 2013 to 668.8 million tonne following a 1.9% increase in 2012. In 2014, steel demand is expected to grow by 2.5% as the Chinese government''s measures to control investment in an effort to rebalance the economy will remain in place.

On the domestic front steel demand is also expected to pick up growth is expected to be up by 5.9% to 75.8 million tone in 2013 following 2.5 % growth in 2012 as monetary easing is expected to support investment activities. In 2014, growth in steel demand is expected to further accelerate to 7.0%, owing to the reform measures aimed at narrowing the fiscal deficit, coupled with measures to improve the foreign direct investment climate.

FUTURE STRATEGY AND GROWTH

As reported earlier, your Company, as a measure for backward integration, was setting up a 100 MW Captive Power Plant. The phase-I (One Turbine of 50MW and One Boiler) of the project was successfully synchronized on 8th July 2011. The erection & commissioning activities for phase-II (2nd Turbine of 50MW and 2nd Boiler) have been completed. Commissioning of the third boiler is expected by September/October, 2013.

Once the Power plant is fully operational the Company shall benefit by continuous supply of quality power and shall also help realize a good return on its investment by selling the excess in open market.

Also, your company is also looking at forward integration by way of setting up green field projects, acquisitions, joint ventures etc.

INDUSTRIAL RELATIONS

Industrial relations with workers, trade unions, and with local populace remained amicable and pleasant throughout the year.

DIRECTORS

During the year, Mr. Harish Salve and Mr. Vineet Saraf have resigned from the Board of your Company. The Board places on record its gratitude for the services rendered by Mr. Harish Salve and Mr. Vineet Saraf during their tenure as members of the Board.

Mr. S. Sridhar was appointed as a Director on the Board of the Company w.e.f 28th July, 2012 as a director in casual vacancy caused by the resignation of Mr. Harish Salve.

Further, during the year Mr. Vinod Saraf was appointed as an Additional Director w.e.f 19th January, 2013 and the Joint Managing Director of the Company subject to approval of the members of the Company.

Mr. Arye Berest, Mr. M.B. Thaker, Mr. A.S. Kapre and Mr. N.L. Ajwalia shall retire by rotation at the ensuing 57th Annual General Meeting and, being eligible, offer themselves for re-appointment.

The Company has formulated a code of conduct for all members of the Board and Senior Management Personnel. All concerned members/ executives have affirmed compliance with the said code.

SUBSIDIARIES

The Report and Accounts of the Company are prepared in consolidated form and contains results of its subsidiaries, Facor Power Limited, Facor Realty and Infrastructure Limited and Facor Energy Limited. The annual accounts of the subsidiaries shall be available on request to the members of the Company and are available for inspection at the registered office of the Company.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of Companies Act, 1956, your Directors confirm that -

i) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations;

ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) they have prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Audit Committee of the Company comprises of Mr A.S. Kapre, Mr M.B. Thaker, and Mr. S.B. Mishra, all Independent Directors. The committee has been constituted in strict compliance with the provisions of Clause 49 of the Listing agreement and assumes all responsibilities provided therein, discharging their duties diligently with transparency and accountability as their sole motivation.

AUDITORS

M/s Salve & Company, Chartered Accountants hold office upto the conclusion of the ensuing 57th Annual General Meeting. The Company has received a requisite Certificate pursuant to Section 224 (1B) of the Companies Act 1956 regarding their eligibility for reappointment as Auditors of the Company. You are requested to appoint Auditors for the current year and to fix their remuneration.

AUDITOR''S REPORT

The observations made in the Auditors'' Report are self explanatory and therefore, do not call for any further comments u/s 217(3) of the Companies Act, 1956.

COST AUDITORS

Your Directors had, in accordance with the General Circular from the Ministry of Corporate Affairs appointed M/s Niran & Co., Cost Accountants, as Cost Auditors for Financial Year ended 31st March, 2013, for which Central Government approval had been received by the Company. The report on Cost audit for Financial Year ended 31st March 2012 was filed on 28th December, 2012 and in respect of Financial Year ended 31st March, 2013 would be filed with Central Government before 30th September, 2013. Further your Directors have appointed M/s Niran & Co., Cost Accountants, as Cost Auditors of the Company for Financial year ended 31st March, 2014 as well subject to the approval of the Central Government.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo, in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure ''A'' which forms part of this Report.

PARTICULARS OF EMPLOYEES

During the year under review there were no employees receiving remu- neration of or in excess of Rs. 60,00,000/- per annum or Rs.5,00,000/- per month requiring disclosure as per the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

CORPORATE GOVERNANCE

In terms of clause 49 of the Listing Agreement, a separate report on Corporate Governance, Management Discussion and Analysis along with your Company''s Statutory Auditors'' Certificate dated 27th May,

2013 confirming the above compliance is annexed to and forms part of the Directors'' Report.

HUMAN RESOURCE DEVELOPMENT

Your Company takes great pride in the commitment,competence and vigour shown by its workforce in all realms of business. The Company continues to take new initiatives to further align its HR policies to meet the growing needs of its business.

ACKNOWLEDGEMENTS

Directors of the Company wish to thank the Central and State Governments for their continued support and co-operation extended towards the business as well as the company''s social functions The

Management also thanks the shareholders, Business Associates, Financial Institutions & Banks, Customers and Suppliers for the faith reposed in the Company and in them. The Board expresses its sincere appreciation to the dedicated and committed team of employees and workmen without whom reaching this far and maintaining the standard and quality of the products for which the company is famous, would not have been possible. We look forward to all of your continued support. Let''s grow and move ahead together.

On behalf of Board of Directors,

Place : New Delhi R.K. SARAF

Dated : 27th May, 2013 Chairman & Managing Director

Mar 31, 2012

The Directors have pleasure in presenting the 56th Annual Report of your Company and the Audited Statement of Accounts for the year ended 31st March, 2012.

FINANCIAL RESULTS

(Rs. in lacs)

Particulars For the year For the year ended 31st ended 31st March, 2012 March, 2011

Gross Profit/(Loss) 767.18 6867.18

Depreciation/Amortization 975.86 997.84

Provision for taxation 131.54 2125.02

Net Profit/(Loss) for the year (340.22) 3744.32

Transfer to General Reserve - 2000.00

Balance carried to Balance Sheet 3844.97 4185.19

OPERATIONS

Ferro alloys industry is a part of core sector, which supplies crucial intermediaries to the steel industry. Its growth is primarily related to the growth of steel industry domestically as well as globally. Steel Industry is marking a century since stainless steels were first created, patented and produced. During the 100 years, stainless steel has grown to be an integral part of our modern word. World's crude stainless steel production in 2011 was 32.1 million tonnes, up by 3.3% from 2010. Production in China of crude stainless steel in 2011 was 12.5 million tones, up by 11.9% from 2010. The production of crude stainless steel in 2012 is expected to reach 34 million tonnes. The biggest growth will again be in China, followed by India. The international steel industry is growing at a rapid pace resulting in robust demand for various Ferro Alloys like Ferro Chrome, Ferro Manganese, Ferro Silicon, Silico Manganese and noble Ferro Alloys. Indian Ferro Alloys industry has also grown during the year 2011-12. Also, the world crude steel production reached 1,527 million tonnes (M.T.) reflecting an increase of 6.8% over 2010 and was a record for global crude steel production. Annual production for Asia was 988.2 million MT for 2011, an increase of 7.9% compared to 2010. In India the end users of steel are primarily infrastructure projects, construction of dams, malls railway stations, utensils, auto industry, defence sector etc. The major part of consumption is in infrastructure and auto industry.

Power cost continue to plague the ferro alloys industry, and forms almost 40% of the cost of production. Ever increasing price is affecting revenue and as such has rendered Indian ferro alloys product non competitive in the international market. Due to lack of proper coal allocation and high cost of coal the captive power plant setup also suffers from high cost of production which is passed on to the ferro alloys produce. Your Company, however, is a fully integrated producer owning chrome ore mines and access to captive power through its subsidiary viz. Facor Power Limited.

Your company's turnover for the current financial year, 2011-12 stands at Rs.47604.17 lacs as against Rs.48786.54 lacs last year. Exports during the year saw a slight decline against last year. Further, your company has posted a loss of Rs.208.68 lacs this year as against profit of Rs.5869.34 lacs in the previous year.

DIVIDEND

Keeping in view the future requirements of funds in working capital and other purposes, the Directors do not recommend any dividend in the financial year ended 31st March, 2012.

FINANCE

Your Company has not raised any deposit from public during the year.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard AS-21 on Consolidated Financial Statements the audited Consolidated Financial Statements are provided in the Annual Report.

SUBSIDIARIES

In terms of the general circular issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. However, the financial information of the subsidiary companies is disclosed in the Annual Report in compliance with the said circular. The company will make available the Annual Accounts of the subsidiary companies and related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the Company will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies as well. Further, the Consolidated Financial Statements presented by the Company include the financial results of the subsidiary companies.

PROSPECTS

As highlighted above, prospects of ferro alloys industry is dependent on the growth of steel industry. Infrastructure and auto industry are the major consumers, consequently, developing countries are major customers of all type of steel for their growth. Prospect for ferro alloys industry seems bright and is expected that demand of steel shall be doubled by 2015. As per world steel forecast, steel demand in India should grow by 6.9% in 2012 and the growth should accelerate to 9.4% in 2013. Further, the low per capita consumption of stainless steel in India which was 2.1 kg as compared to 7.5 kg in China and the world average of 4 Kg all in the 2011-12 fiscal year, constitutes a huge opportunity for growth in this sector. Indian Stainless Steel consumption will grow at a compounded annual growth rate of 9.7% reaching 3.4 million tonnes per annum by 2015, outstripping global consumption growth of 6% to 34.12 million tonnes which is a welcome sign for the ferro alloys industry as consumption of ferro alloys will increase.

Further, there are indications that there may be power shortage in South Africa, which may directly affect the production of ferro alloys to some extent. This factor may help Indian Ferro Alloys industry to utilize its idle capacity to take seize the opportunity of meeting the shortfall by South Africa. However, full utilization of capacity may happen provided raw materials are readily available and the power cost is made internationally comparable with peers like South Africa and CIS countries.

South Africa is exporting large quantities of Chrome Ore to China and making China highly competitive to South African Ferro Chrome production. Therefore, Government of South Africa is seriously planning to impose export duty on Chrome Ore thereby the landed cost of Chrome ore in China will be exorbitant resulting in higher cost of production of Ferro Chrome. Hence, there are good prospects of export of Indian High Carbon Ferro Chrome to China.

FUTURE STRATEGY AND GROWTH

As reported earlier, your Company, as a measure for backward integration, was setting up a 100 MW Captive Power Plant. The phase-I (One Turbine of 50MW and One Boiler) of the project was successfully synchronized on 8th July 2011 and the same was under testing till 30th September 2011. The erection & commissioning activities for phase-II (2nd Turbine of 50MW and 2nd Boiler) of the Project are in full swing and expected to be synchronized by July/August, 2012.Commissioning of 3rd boiler is expected by June/July, 2013.

Once the Power plant is fully operational the Company shall benefit by continuous supply of quality power and shall also help realize a good return on its investment by selling the excess in open market.

Further, measures are being taken to increase the capacity of production to 115000 MT p.a. from present 65000 MT p.a. New Furnace with high quality yield are being considered for capacity enhancement. This is in line with our focus on upgradation of technology for sustained growth and better utilization of resources.

Also, your company is also looking at forward integration by way of setting up green field projects, acquisitions, joint ventures etc.

INDUSTRIAL RELATIONS

Apart from the lockout carried out by the Company on its plant located at Randia, from 29.06.11 to 10.07.11 industrial relations with the labour union were peaceful and satisfactory. The lockout was called due to unlawful activities by the labour union which resulted in non conducive and potentially unsafe work environment.

DIRECTORS

Mr. S.B. Mishra, Mr. M.D. Saraf, Mr. Rohit Saraf and Mr. Ashish Saraf shall retire by rotation at the ensuing 56th Annual General Meeting and, being eligible, offer themselves for re-appointment.

The Company has formulated a code of conduct for all members of the Board and Senior Management Personnel. All concerned members/ executives have affirmed compliance with the said code.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of Companies Act, 1956, your Directors confirm that -

i) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations;

ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) they have prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Audit Committee of the Company comprises of Mr A.S. Kapre, Mr M.B. Thaker, and Mr. S.B. Mishra, all Independent Directors. The committee has been constituted in strict compliance with the provisions of Clause 49 of the Listing agreement and assumes all responsibilities provided therein, discharging their duties diligently with transparency and accountability as their sole motivation.

AUDITORS

M/s Salve & Company, Chartered Accountants hold office upto the conclusion of the ensuing 56th Annual General Meeting. The Company has received a requisite Certificate pursuant to Section 224 (1B) of the Companies Act 1956 regarding their eligibility for reappointment as Auditors of the Company. You are requested to appoint Auditors for the current year and to fix their remuneration.

COST AUDITORS

Your Directors had, in accordance with the General Circular from the Ministry of Corporate Affairs appointed M/s Niran & Co., Cost Accountants, as Cost Auditors for Financial Year ended 31st March, 2012, for which Central Government approval had been received by the Company. The report on Cost audit for Financial Year ended 31st March, 2012 would be filed with Central Government before 30th September, 2012. Further, your Directors have appointed M/s Niran & Co., Cost Accountants, as Cost Auditors of the Company for Financial year ended 31st March, 2013 as well for which Central Government approval has also been received.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo, in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure 'A' which forms part of this Report.

PARTICULARS OF EMPLOYEES

During the year under review there were no employees receiving remu- neration of or in excess of Rs.60,00,000/- per annum or Rs.5,00,000/- per month requiring disclosure as per the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

CORPORATE GOVERNANCE

In terms of clause 49 of the Listing Agreement, a separate report on Corporate Governance, Management Discussion and Analysis along with your Company's Statutory Auditors' Certificate dated 28th July, 2012 confirming the above compliance is annexed to and forms part of the Directors' Report.

ACKNOWLEDGEMENTS

Directors of the Company wish to thank the Central and State Governments for their continued support and co-operation extended towards the business as well as the company's social functions. The Management also thanks the shareholders, Business Associates, Financial Institutions & Banks, Customers and Suppliers for the faith reposed in the Company and in them. The Board expresses its sincere appreciation to the dedicated and committed team of employees and workmen without whom reaching this far and maintaining the standard and quality of the products for which the company is famous, would not have been possible. We look forward to all of your continued support. Let us grow and move ahead together.

On behalf of Board of Directors,

Place : New Delhi R.K. SARAF

Dated : 28th July, 2012 CHAIRMAN & MANAGING DIRECTOR

Mar 31, 2011

TO THE MEMBERS

The Directors are delighted to present the 55thAnnual Report of your Company and the Audited Statement of Accounts for the year ended 31st March, 2011.

FINANCIAL RESULTS

Rs. in lacs

Particulars For the year For the year

ended 31st ended 31st March, 2011 March, 2010

Gross Profit/(Loss) 6870.18 3373.27

Depreciation/Amortization 997.84 1024.03

Provision for taxation 2128.02 947.36

Net Profit/(Loss) for the year after tax 3744.32 1401.88

Transfer to General Reserve 2000.00 2000.00

Balance carried to Balance Sheet 4185.19 2979.18

OPERATIONS

2010-11 witnessed both natural and economic disasters which could not keep any company across the globe insulated thus affecting operations in some way or the other. Your company was also affected due to the above.

However, with GDP estimated to have grown at 8.6% in 2010-11 in real terms, the economy has shown remarkable rescillence and so has your company.

During the year 2010-11 operations at the Charge chrome plant and mines showed improved performance. The production of Charge Chrome/Ferro Chrome and chrome ores was higher as compared to that of the previous year. Over the years, the company has also reduced the tonnage under conversion contract with Tata Steel.

Ferro alloy products are used in the production of steel as de-oxidant and alloying agents and the Ferro alloys industry acts an intermediate industry to the Iron & Steel industry. Being an intermediate product its demand and prices move in sync with that of steel.

Power cost forms almost 40% of the cost of production and ever increasing price is affecting revenue and as such has rendered Indian ferro alloys product non competitive in the international market. To tide over this problem your company is in the process of establishing a captive power plant with total capacity of 10 0 MW first phase comprising of 45 MW has now been synchronized and awaits commissioning. Post commissioning your company shall be self reliant for power.

The overall turnover of the Company increased from Rs. 348.58 crores in 2009-2010 to Rs. 487.87 crores in 2010-2011 recording an increase of 39.96%. Exports were also higher at Rs. 282.31 crores as compared to Rs. 208.35 crores in the previous year registering a growth of 35.50%. Profit before tax too surged to Rs. 58.72 crores as compared to Rs..23.49 crores in the previous year recording an increase of 149.98%.

DIVIDEND

Your Directors have, in their meeting held on 1st August, 2011 proposed dividend at the rate of Rs. 0.25 (25%) per share of Rs. 1 each for the financial year ended 31st March, 2011 which shall be paid on or before 11th October, 2011 once approved by the members of the Company at the 55th Annual General Meeting of the Company.

FINANCE

Your Company has not raised any deposit from public during the year.

PROSPECTS

The ferro alloys industry forms part of the core sector under the Ministry of Steel and is engaged in supplying crucial intermediate products to the Steel industry. Consequent to dip in global stainless steel production during the preceding year coupled with cut down in Chinese steel production the demand as well as price of ferro alloys was reduced by 25%. Also, the credit squeeze policy of the Chinese Government has aggravated the situation and the demand for ferro alloys products has reduced during the last two quarters. There is overcapacity of Stainless steel as demand for stainless steel is around 5-6 Million tons against the production capacity of 8-9 Million tons. European markets also do not seem very encouraging with Greece and Spain opting for debt restructuring. Also, the Turkish producers have become aggressive in the chrome ore market and have resulted lower chrome ore prices.

On the domestic front ferro alloys industry has capacity of 4.04 million tons and is working at capacity utilization of 65%. However, Ferro alloys producers are now looking towards the domestic market for sustenance with mega steel projects been approved for installation for various capacities which now are poised to be commissioned at the earliest. Per capita consumption of steel is very low in India as against the global standards and that of developed countries which provides strong growth opportunity. With India on growth path, steel industry shall remain in the focus as it forms the core sector for development, in the light of which the prospects of ferro alloys industry for the coming years are expected to remain good.

Further, the steps taken by the Government of India to boost the sentiments of the manufacturing industry in general and iron & steel industry, in particular,by imposing export duty on chrome ore to ensure availability of this important raw material for production of High Carbon Ferro Chrome provides an indication for the growth of indian ferro alloys industry.

FUTURE STRATEGY AND GROWTH

The first phase covering 45 MW of the 100 MW captive thermal power plant set up by Facor Power Limited has completed the synchronization process and awaits commissioning is likely to go onstream by end of August, 2011 and the second phase by November / December, 2011.

With power deficit in the country your company sees opportunity in the power sector and is on look out for various opportunities in both conventional and renewable sources with varying capacities.

Also, your company is also looking at forward and backward integration. While forward integration is being planned by way of setting up green field projects, acquisitions, joint ventures etc., backward integration is being planned for setting up power projects to contain the power cost, acquisition of chromite mines, enhancement of existing capacities etc.

Further, your company also remains focused on upgradation of technology for a sustained growth.

INDUSTRIAL RELATIONS

Apart from a brief lockout by the Company on its plant located at Randia, from 29.06.11 to 10.07.11 industrial relations with the labour union were peaceful and satisfactory. The lockout was called due to unlawful activities by the labour union which resulted in non conducive and potentially unsafe work environment. The matter was subsequently settled amicably.

DIRECTORS

Mr. M.B. Thaker, Mr. A.S. Kapre, Mr. Vineet Saraf and Mr. N.L. Ajwalia shall retire by rotation at the ensuing 55th Annual General Meeting and, being eligible, offer themselves for re-appointment.

The Company has formulated a code of conduct for all members of the Board and Senior Management Personnel. All concerned members/ executives have affirmed compliance with the said code.

SUBSIDIARIES

The Report and Accounts of and Facor Realty And Infrastructure Limited, subsidiary of your Company, are annexed along with statement pursuant to section 212 of the Companies Act, 1956.

DIRECTORS REPOSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of Companies Act, 1956, your Directors confirm that -

i) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations;

ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) they have prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Audit Committee of the Company comprises of Mr A.S. Kapre, Mr M.B. Thaker, Mr Umesh Khaitan and Mr. S.B. Mishra, all Independent Directors . The committee has been constituted in strict compliance with the provisions of Clause 49 of the Listing agreement and assume all responsibilities provided therein, discharging their duties diligently with transparency and accountability as their sole motivation.

AUDITORS

M/s Salve & Company, Chartered Accountants hold office upto the conclusion of the ensuing 55thAnnual General Meeting. The Company has received a requisite Certificate pursuant to Section 224 (1B) of the Companies Act 1956 regarding their eligibility for reappointment as Auditors of the Company. You are requested to appoint Auditors for the current year and to fix their remuneration.

AUDITOR'S REPORT

The observations made in the Auditors' Report are self explanatory and therefore, do not call for any further comments u/s 217(3) of the Companies Act, 1956.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo, in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed as Annexure 'A' which forms part of this Report.

PARTICULARS OF EMPLOYEES

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, forms part of the Report. However, as per the provision of section 219(1)(b)(iv) of the said Act, the Report and Accounts are being sent to all shareholders of the Company excluding the statement of particulars of employees u/s 217(2A) of the said Act. Any shareholder desirous of obtaining a copy of the statement may write to the Company Secretary of the Company.

CORPORATE GOVERNANCE

In terms of clause 49 of the Listing Agreement, a separate report on Corporate Governance, Management Discussion and Analysis along with your Company's Statutory Auditors' Certificate dated 1st August, 2011 confirming the above compliance is annexed to and forms part of the Directors' Report.

ACKNOWLEDGEMENTS

Directors of the Company wish to thank the Central and State Governments for their continued support and co-operation extended towards the business as well as the company's social functions. TheManagement thanksthe shareholders, Business Associates, Financial Institutions & Banks, Customers and Suppliers for the faith reposed in the Company and in them. The Board also expresses its sincere appreciation to the dedicated and committed team of employees and workmen without whom reaching this far and maintaining the standard and quality of the products for which the company is famous, would not have been possible and look forward to continued support.

On behalf of Board of Directors,

Place : New Delhi R.K. SARAF

Dated : 1st August, 2011 CHAIRMAN & MANAGING DIRECTOR

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