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Directors Report of Godawari Power & Ispat Ltd.

Mar 31, 2023

Your Directors have pleasure in presenting the 24th Annual Report on the business & operations of the Company together with the Standalone and Consolidated Audited Financial Statement for the year ended 31st March 2023.

1. FINANCIAL HIGHLIGHTS:

Particulars

Rs. In Crores

Standalone Consolidated

2022-23

2021-22

2022-23

2021-22

Gross Revenue from operations

5284.72

5074.60

5753.04

5399.18

Other Income

96.24

18.34

104.06

29.37

Total Revenue

5380.96

5092.94

5857.10

5428.55

Operating expenses

4173.21

3293.62

4620.34

3535.01

Profit before Interest, Depreciation, Tax and Amortization (EBIDTA)

1207.75

1799.32

1236.76

1893.54

Finance Costs

15.21

17.35

20.40

19.69

Depreciation and amortization expenses

117.00

101.75

123.53

104.7

Profit/(loss) before exceptional item and tax

1075.54

1680.22

1092.83

1769.15

Add: Share of Profit/(Loss) of Associates & Joint Ventures net of tax

0.00

0.00

4.47

65.17

Exceptional item

2.08

98.74

-14.72

98.74

Profit/(Loss) Before Taxation

1077.62

1778.97

1082.58

1933.07

Taxation (including Deferred Tax)

294.40

428.00

289.22

451.15

Profit/(Loss) after Taxation (PAT)

798.22

1350.96

793.36

1481.92

2. REVIEW OF PERFORMANCE:

Your Company''s performance during the year under review was satisfactory and the Company has reported operating margins of 22.44% on standalone operations and margin of 21.12% on consolidated operations, although lower last year, but in line with long term average margins. The operating margin in FY22 was considerably higher on account global supply chain disruption and substantially higher iron ore & finished steel prices across value chain. The realization for iron ore pellet was also higher in FY22 at H13881 ton, which fell to H10355 ton on account of imposition of export duty on iron ore pellets and other steels products for part of the year, which alongwith increase in the input cost of coal and other operational costs, resulted into lower profitability during the year under review. The realizations of all the products have also decreased as compared to previous year which in turn adversely affected the operating margins/EBIDTA of the Company. As communicated in our last reports, the Company''s efforts for making high grade pellets has been successful and also contributed to the profitability of the Company. Given the above backdrop, the highlight of standalone & consolidated results are given below:

Standalone Operations:

• Revenue from operations for the year increased by 4%

to H5284.72 Crores as compared to H5074.60 Crores achieved during previous Financial Year on account of higher sale of pellet volume and other value added products.

• EBITDA for the year decreased by 33% to H1207.75 Crores as compared to EBITDA of H1799.32 Crores achieved in previous Financial Year.

• Profit after tax decreased by 41% to H798.22 Crores (excluding profit from sale of investments) as compared to net profit of H1350.96 Crores in previous Financial Year.

Consolidated Operations:

• Revenue from operations for the year marginally increased by 6.55% to H5753.04 Crores as compared to H5399.18 Crores during the previous Financial Year;

• EBITDA for the year decreased by 34.68% to H1236.76 Crores as compared to EBITDA of H1893.54 Crores achieved during previous Financial Year.

• Profit after tax during the year decreased by 46.46% to H793.36 Crores as compared to net profit after tax of H1481.92 Crores during previous Financial Year.

The detailed comments on the operating and financial

performance of the Company, during year under review have

been given in the Management Discussions & Analysis.

3. DIVIDEND AND DIVIDEND DISTRIBUTION POLICY:

The Board of Directors of your Company has recommended final dividend of H4.00 per Shares (Previous Year H8.50 per share) of H5/- each on the paid up capital of the Company for the financial year 2022-23. The outflow of funds on account of final dividend shall be H54.38 crores (previous year H119.80 crores). The final dividend for the financial year 2022-23, if approved, by the shareholders of the company in the ensuing Annual General Meeting, the same will be paid in due course as per the applicable provisions. In addition to the proposed final dividend of H4/- per share, the Company has recently concluded buyback of 50,00,000 equity shares of H5/-each fully paid at a price of H500/- per share amounting to H250 Crores. Together with the buyback consideration, the total distribution of funds to the shareholders of the Company amounted to H305 Crores (including buyback tax payments), which was 38.21% of the net profit of the Company. (Previous year H137.42 Crores i.e. 10.17% including interim dividend).

Dividend Distribution Policy In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, (''SEBI Listing Regulations'') the Board of Directors of the Company (the ''Board'') formulated and adopted the Dividend Distribution Policy (the ''Policy''). The Policy is available on our website at https://www. godawaripowerispat.com/wp-content/uploads/2022/02/ Dividend-Distribution-Policy.pdf

4. SHARE CAPITAL:

As on 31st March, 2023, the paid up Equity Share Capital of the company was H70.47 Crores divided into 14,09,44,988 Equity Shares of H5 each/-.

During the year under review, the Company has not issued any shares with differential voting rights nor granted stock options nor sweat equity. As on 31st March 2023, the company has not issued any convertible instruments and none of the Directors of the Company hold convertible instruments of the Company.

The equity shares of the company representing 99.99% of the share capital are dematerialized as on 31st March, 2023.The dematerialization facility is available to all shareholders of the company from both the depositories namely National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Depositories has allotted ISIN: INE177H01021 due to sub division of Equity shares of the Company for dematerialization of shares of the company.

5. BUYBACK OF SHARES:

The Board of Directors in its meeting held on 18.03.2023 approved the proposal for buyback of up to 50,00,000

(Fifty Lakhs) fully paid up equity shares of the Company, having a face value of H5 (Rupees Five Only) each representing 3.66% of the total number of equity shares in the existing paid-up equity capital of the Company (excluding 45,00,00 shares held by GPIL Beneficiary Trust), at a price of H500/- (Rupees Five Hundred Only) per fully paid up Equity Share payable in cash for an aggregate maximum amount not exceeding H250.00 Crores (Rupees Two Fifty Crores Only), represents 8.14% and 7.67% of the aggregate of the total paid-up equity share capital and free reserves of the Company based on the audited standalone and consolidated financial statements of the Company as at March 31, 2022, respectively, through the “Tender Offer” route as prescribed under the SEBI Buyback Regulations. The entire process of the Buyback of equity shares has been completed and the payment of buyback consideration was made on April 24, 2023 and the 50,00,000 equity shares were extinguished on April 28, 2023. The total outflow of funds on account of buyback amounted to H305 Crores including buyback tax paid by the Company).

The Buyback consideration price of H500/- per share represents:

(i) Premium of 32.31% and 32.69% over the volume weighted average market price of the Equity Shares on NSE and BSE, respectively, during the three months preceding Wednesday, March 15, 2023, being the date of intimation to the Stock Exchanges for the Board Meeting to consider the proposal of the Buyback (“Intimation Date”).

(ii) Premium of 36.00% and 36.16% over the volume weighted average market price of the Equity Shares on NSE and BSE, respectively, for two weeks preceding the Intimation Date.

(iii) Premium of 39.10% and 39.12% over the closing price of the Equity Shares on NSE and BSE, respectively, as on Tuesday, March 14, 2023, being the day preceding the Intimation Date.

(iv) Premium of 33.87% and 33.82% over the closing price of the Equity Shares on NSE and BSE, respectively, as on Wednesday, March 15, 2023, being the day of Intimation Date.

(v) Premium of 29.10% and 28.77% over the closing price of the Equity Shares on NSE and BSE, respectively, as on 1 (one) day prior to the Board Meeting i.e., Friday, March 17, 2023, as there was a trading holiday on the day of the Board Meeting for Buyback.

Upon conclusion of the Buyback the paid up share capital of the company decreased from H70.47 Crores divided into 14,09,44,988 Equity Shares of H5 each/- to H67.97 Crores divided into 13,59,44,988 Equity Shares of H5 each/-.

6. EXPANSION/NEW PROJECTS:

The proposed 70 MWp Captive Solar PV Power plant of the Company at Rajnandgaon, Chhattisgarh has been commissioned and duly synchronized with the grid and commenced on 08th August, 2022. The power generated at Solar Power Plant is being captively consumed to meet partially the enhanced power requirement for Integrated Steel Plant and partially to replace the high cost grid power. The generation of Solar energy also supports the green initiatives of the Company and reduce the carbon foot print in the economy.

The Company is setting up another 30 MW Solar Power Plant for which the Company has acquired land and all the modules and other equipments have been received at site. Construction work has started and the same is expected in Q2FY2024.

The Company has purchased 25MW thermal Power Plant from Jagadamba Power and Alloys Limited (JPAL) on Slump Sale Basis in the month of June, 2022, to meet the captive power requirement of the Company.

In addition to the above, the Company is undertaking investment in capital expenditure for debottlenecking in power division by replacement of old turbines into new latest technology and high efficiency power generating turbine, which would result into additional generation of electric power by 8MW without any additional fuel & operating cost.

The Company is also undertaking debottlenecking in the Iron & Steel making facilities in various plants, as detailed below, which are also expected to be completed during the current year.

Particulars

Capacity

CAPEX in H Crores

FY22

FY23

Total

Already incurred upto 31.03.2023

Balance to be incurred

Iron Ore Mining, Crushing and Beneficiation facilities

2.10 MTPA

3.05 MTPA

85.00

83.90

1.10

Steels Billets

0.40 MTPA

0.50 MTPA

41.00

36.40

4.60

Rolling Mill Modification (RR Ispat Unit)

0.214 MTPA

0.216 MTPA

70.00

7.40

62.60

Replacement of Turbines in Power Plant

73 MW

73 MW

86.00

46.30

39.70

Your Company has also announced increase in Iron Ore mining capacity at Ari Dongri Mines from 2.35 million tons to 6 million tons with additional iron ore crushing & beneficiation plant at Ari dongri mines and also for setting up of an additional 3 million tons pellet capacity at existing plant location at Raipur at an aggregate investment of H1000 crores. The Company has initiated the process for environmental approval for enhancement in mining capacity and pellet plant and the same is expected to be received during the current year. The construction activities shall start post receipt of environmental approval.

Your Company has also initiated process for green field steel plant with a capacity of 1.00 million in Raipur District of Chhattisgarh and have applied for land acquisition and environmental approval. The Company has already received letter of allotment for land acquisition and process for transfer of land to the Company is going on. Similarly, the Company has applied for the environment approval for the project and approval is awaited.

7. ANNUAL RETURN:

In accordance with the Companies Act, 2013, the annual return in the prescribed format is available at https://www. godawaripowerispat.com/performance/shareholders/ annual-return/

8. NUMBER OF MEETINGS OF BOARD:

During the period under review, Eight Board Meetings were convened and held, the details of which are given in the Corporate Governance Report.

9. DIRECTORS’ RESPONSIBILITY STATEMENT:

Your Directors make the following statements in terms of Section 134(3) (c) of the Companies Act, 2013 based on the representations received from the operating management and Chief Financial Officer of the Company:

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

b. That your Directors have selected such accounting policies and applied them consistently, and made judgment 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.

c. That your Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

d. That your Directors have prepared the annual accounts on a going concern basis.

e. That your Directors have laid down proper internal financial controls to be followed by the Company and that such financial controls are adequate and were operating effectively; and

f. That your Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

10. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTOR:

All Independent Directors of the Company have given declarations as required under the provisions of Section 149 (7) of the Companies Act, 2013 stating that they meet the eligibility criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and Regulation 25 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

11. SEPERATE MEETING OF INDEPENDENT DIRECTORS:

During the year under review, the Independent Directors held their separate meeting on 06th May, 2023 inter alia, to discuss:

• Review the performance of Independent Directors.

• Review the performance of the Non-Independent Directors.

• Review the performance of the committees and Board as a whole.

• Review the performance of the Chairman of the Company, taking into account the views of Executive Directors and Non Executive Directors.

• Assess the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties

12. NOMINATION AND REMUNERATION COMMIITEE AND ITS POLICY:

Company''s Policy on Directors Appointment and Remuneration including criteria for determining qualification, positive attributes, independence of directors and other matters provided under section 178(3) of the Companies Act, 2013 is also placed at the website of the Company at www.godawaripowerispat. com.

Subsequent to resignation of Mr. Bhrigu Nath Ojha from Directorship of the Company, the Nomination and Remuneration committee has been reconstituted by the Board of directors in its meeting held on 29.07.2022,

by inducting Mr. Raj Kamal Bindal, Independent NonExecutive Director, as member of the Nomination and Remuneration Committee. to comply with the provisions of Regulation 19(1) of SEBI (Listing Obligations And Disclosure Requirements) Regulations, 2015. Consequent upon resignation of Mr Bhrigu Nath Ojha, Mr. Shashi Kumar was designated as Chairman of the Committee w.e.f. 29.07.2022 and subsequently Miss Bhavna Govindbhai Desai, was designated as Chairperson with effect from 10.11.2022 in place of Mr Shashi Kumar.

Presently it consists of following three Independent Directors:

S.

No.

NAME

DESIGNATION

1.

Ms. Bhavna

Chairperson and Member -

Govindbhai Desai

Independent - Non Executive Director

2.

Shri Shashi Kumar

Member- Independent - Non Executive Director

3.

Mr. Raj Kamal

Member- Independent - Non

Bindal*

Executive Director

*Inducted as Member with effect from 29.07.2022.

More details are given in the Corporate Governance Report.

13. AUDITORS:

Statutory Auditors

Pursuant to the provisions of Section 139 of the Act and the rules framed thereafter, M/s JDS and Co., Chartered Accountants, were appointed as Statutory Auditors of the Company for a second term of five consecutive Financial Years by the shareholders in their Annual General Meeting held on 16.09.2022 to hold office from the conclusion of Annual General Meeting till the conclusion of the Annual General Meeting of the Company to be held in the year 2027.

Consequent upon merger of M/s JDS and Co., Chartered Accountants with Singhi & Co., the audit committee and Board in their respective meetings held on 09.12.2022 have approved the proposal for change of name of statutory auditor''s firm of the company from M/s JDS & Co. (FRN: 018400C) to M/s. Singhi & Co (FRN: 302049E) which has been duly approved by the shareholders of the company in their Extra Ordinary General Meeting held on 21.01.2023 for the change of name of statutory auditor''s firm of the company from M/s JDS & Co. (FRN: 018400C) to M/s. Singhi & Co (FRN: 302049E) for a period of five years from the financial year 2022-23 to financial year 2026-27 i.e. till conclusion of the Annual General Meeting to be held in the year 2027 after obtaining a certificate from M/s. Singhi & Co. to the effect that if their appointment is made, the same would be within the limits prescribed under Section 141 (3) (g) of the Companies Act, 2013 and that they are not disqualified for re-appointment and also satisfies the

criteria as mentioned under Section 141 and they have obtained peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Record and Audit) Amendment Rules 2014 M/s Sanat Joshi & Associates has been appointed as cost auditors for conducting Cost Audit for the Financial Year under review.

Internal Auditors

Pursuant to the provisions of Section 138 of the Companies Act, 2013 M/s. OPS & Co, Chartered Accountants were appointed as Internal Auditors for the Financial Year under review.

Secretarial Audit

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 CS Tanveer Kaur Tuteja, Practising Company Secretary, (FCS 7704, CP 8512) to undertake the Secretarial Audit of the Company.

14. AUDITOR’S REPORTS:

• Statutory Auditors

There are no qualifications, reservations, adverse remarks or disclaimers in the Statutory Auditor''s Report on the financial statements of the Company for the Financial Year 2022-23 and hence does not require any explanations or comments by the Board.

• Frauds reported by the Auditors:

No frauds have been reported by the Statutory Auditors during the Financial Year 2022-23.

• Secretarial Audit

The Secretarial Audit Report received from the Secretarial Auditor of the Company for the Financial Year 2022-23 is annexed herewith as ANNEXURE 01.

The Company''s subsidiary company namely Hira Ferro Alloys Limited (HFAL) being the material subsidiary of the Company, in accordance with Regulation 24A of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) 2015 has also obtained Secretarial Audit Report which is annexed herewith as ANNEXURE 02.

There are no qualifications, reservations, adverse remarks or disclaimers in the Secretarial Auditor''s Report on secretarial and other applicable legal compliances to be made by the Company for the Financial Year 2022-23 and hence does not require any explanations or comments by the Board.

15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The particulars of investments made and loans given by the Company as covered under the provisions of Section 186 of the Companies Act, 2013 are given in Standalone Financial Statements (Ref. Notes 6, 7 and 8). Your Company has also extended its corporate guarantee for securing credit facilities granted to its subsidiary company namely Hira Ferro Alloys Limited the details of which are given in Standalone Financial Statements (Ref. Note 32).

16. TRANSFER TO RESERVES:

Your Company has not transferred any amount to the General Reserves Account during the Financial Year 2022-23.

17. TRANSFER OF UNPAID & UNCLAIMED DIVIDEND & SHARES TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Section 125 of the Companies Act, 2013, the outstanding amount of dividend which remained unpaid or unclaimed for a period of seven years and shares whose dividend was unpaid/unclaimed for seven consecutive years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund.

During the year under review, the Company has credited H75,709/- to the Investor Education and Protection Fund (IEPF) pursuant to Section 125 of the Companies Act, 2013/ Section 205C of the Companies Act, 1956 read with the Investor Education and Protection Fund (Awareness and Protection of Investors) Rules, 2001 relating to the Dividend paid by the Company for FY 2014-15.

During the year under review, the Company has also transferred 2092 Equity Shares to the Investor Education and Protection Fund (IEPF) relating to 24 shareholders of the Company, whose dividends were unclaimed/ unpaid for seven consecutive years, pursuant to Section 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund (Awareness and Protection of Investors) Rules, 2001 and the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 relating to Final Dividend paid by the Company for FY 2014-15.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company, as on 16th September 2022 (date of last Annual General Meeting) on the Company''s website (www. godawaripowerispat.com at Investors Information -Unclaimed Dividend) and on the website of the Ministry of Corporate Affairs.

Any person, whose unclaimed or unpaid amount has been transferred by the Company to IEPF may claim their refunds to the IEPF authority. For claiming such amount, claimant needs to file form IEPF-5 along with requisite documents. The detailed procedure for claiming shares and Dividend Amount has been uploaded on the Website of the Company (www.godawaripowerispat.com at Investors Information - Unclaimed Dividend) and also available on the website of IEPF (www.iepf.gov.in).

The Nodal Officer for the purpose of IEPF is Company Secretary and the website address is www. godawaripowerispat.com.

18. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION:

There are no materials changes and commitments affecting the financial position of the Company occurred between the 01st April, 2023 and date of this report.

19. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as ANNEXURE 03.

20. AUDIT COMMITTEE COMPOSITION:

The Audit Committee was reconstituted pursuant to resignation of Mr. Bhrigu Nath Ojha and Mr. Hari Shankar Khandelwal from the Directorship and Chairmanship/ Membership and appointment of Mr. Raj Kamal Bindal and Mr. Samir Agarwal w.e.f 29.07.2022. Presently it consists of following four Independent Directors all having financial literacy.

S.

No.

NAME

DESIGNATION

1.

Mr. Shashi Kumar

Chairman (Independent NonExecutive Director)

2.

Mr. Raj Kamal Bindal*

Member (Independent NonExecutive Director)

3.

Mr. Samir Agarwal *

Member (Independent NonExecutive Director)

4.

Ms. Bhavna Govindbhai Desai

Member (Independent NonExecutive Director)

*Inducted as Members with effect from 29.07.2022.

More details are given in the Corporate Governance Report.

21. RISK MANAGEMENT COMMITTEE:

The Risk Management Committee was re-constituted with effect from 29.07.2022 consequent upon resignation of Mr. B.L. Agrawal, Mr. Abhishek Agrawal and Mr. Sanjay Bothra from the Membership of the committee

and by inducting Mr. Vinod Pillai as Member. Presently it consists of One Independent Director, One NonExecutive Director and One officer of the company.

More details are given in the Corporate Governance Report.

The risk management issues are discussed in detail in the report of Management Discussion and Analysis.

22. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Company has adopted a Risk Management Policy to identify and evaluate business risks associated with the operations and other activities of the Company and formulated risk mitigations strategies.

23. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:

The Company has constituted a CSR Committee of the Board (“CSR Committee”) pursuant to resolution of the Board dated 15.03.2014.

The Board of Directors at its meeting held on 15.03.2014 approved the powers, role and terms of reference of the CSR Committee in accordance with the provisions of Section 135 of the Companies Act, 2013, and the Board in its meeting held on 31.01.2022 have approved the revised policy framed as per amendments inserted by the Companies (Amendment) Act, 2019, Companies (Amendment) Act, 2020 and Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 and the same has been disclosed on the website of the Company at http://godawaripowerispat.com/wp-content/ uploads/2022/02/CSR-Policy.pdf.

The CSR Committee consists of One Independent Director, One Executive Director and One Non-Executive Director. The detailed composition of the members of the CSR Committee at present is given below:

S.

No.

NAME

DESIGNATION

1.

Mr. Shashi Kumar

Chairman (Independent Non-Executive Director)

2.

Mr. Abhishek Agrawal

Member (Executive Director)

3..

Mr. Vinod Pillai

Member (Non-Executive Director)

The committee met twice during the year 2022-23 and the attendance of the members at these meetings is as follows:

Name of the Chairman/ Member and Date of Meeting

28.05.2022

09.11.2022

Mr. Shashi Kumar

Present

Present

Mr. Abhishek Agrawal

Absent

Present

Mr. Vinod Pillai

Present

Present

CSR Committee’s Responsibility Statement:

CSR Committees hereby states that the implementation and monitoring of CSR activities, is in compliance with CSR objectives and Policy of the Company.

24. ANNUAL REPORT ON CSR ACTIVITIES:

The Annual Report on CSR activities initiated and undertaken by the Company during the year under review is annexed herewith as an ANNEXURE-04.

25. ANNUAL EVALUATION OF BOARD ETC.:

The Nomination and Remuneration Committee has formulated criteria for evaluation of the performance of the each of the directors of the Company. On the basis of said criteria, the Board and all its committees and directors have been evaluated by the Board of the Directors and Independent Directors of the Company.

26. RELATED PARTY TRANSACTIONS:

During the year under review, all related party transactions entered into by the Company, were approved by the Audit Committee and were at arm''s length and in the ordinary course of business. Prior omnibus approval was obtained for related party transactions which are of repetitive nature and entered in the ordinary course of business and on an arm''s length basis. The Company did not have any contracts or arrangements with related parties in terms of Section 188(1) of the Companies Act, 2013. Also, there were no material related party contracts entered into by the Company during the year under review.

Details of related party transactions entered into by the Company, in terms of Ind AS-24 have been disclosed in the notes to the standalone/consolidated financial statements forming part of this Annual Report 2022-23.

27. CHANGES IN NATURE OF BUSINESS:

The Company has been engaged in the business of mining of captive iron ore and manufacturing the Iron Ore Pellets, Sponge Iron, Steel Billets, Wire Rods, HB Wires with generation of both conventional and nonconventional Power for captive consumption. There is no change in the nature of business of the Company during the year under review.

28. CHANGES IN DIRECTORS & KEY MANAGERIAL PERSONNELS:

Based on the recommendations of the NRC, the Board of Directors of the Company, on July 29, 2022, in terms of the applicable SEBI Listing Regulations and provisions of the Companies Act, 2013 read with Schedule IV, appointed Mr. Raj Kamal Bindal (DIN: 07423392) and Mr. Samir Agarwal (DIN: 00093687) as Additional

Independent Non-Executive Directors of the Company subject to the approval of the Members, not liable to retire by rotation, for a period commencing from July 29, 2022 to July 28, 2027.

Mr. Raj Kamal Bindal brings to the Board his extensive knowledge and experience in areas of adequate experience in Political Analysis, core understanding of issues that affects Infrastructure sectors in India, and proficiency in using relationship building skills to obtain long-term sustainable results in varied settings, successfully navigated the complex corridors of bureaucracy and political leaders, understanding of Government processes, working of Public Sector at all levels of Government in India and Provincial Governments across India.

Similarly Mr. Samir Agarwal brings to the Board his extensive knowledge and experience in areas of capital raising, mergers and acquisitions, financial structuring and corporate restructuring.

On September 16, 2022, the Shareholders of the Company, by way of a special resolution, approved the appointment of Mr. Raj Kamal Bindal and Mr. Samir Agarwal as Independent Non-Executive Directors of the Company for the above-mentioned tenure.

Mr Parakhar Agrawal has resigned from the directorship of the Company with effect from 01.04.2022 and Mr. Bhrigu Nath Ojha and Mr. Harishankar Khandelwal have resigned from the Directorship and Chairmanship/ Membership of the company from 29.07.2022. The Board of Directors accepted their resignations and placed on record its deep sense of appreciation for the services rendered and guidance given by them during their respective tenure of office.

During the year, the designation of Mr. Vinod Pillai has been changed from Executive Director to Non-Executive Director with effect from 01.04.2022.

On June 30, 2022, the Shareholders of the Company, by way of a special resolution, approved the re-appointment of Mr. Dinesh Kumar Agrawal as Whole-time Director of the Company for the period of five years with effect from 11.08.2022 and appointment of Mr. Siddharth Agrawal and Mr. Dinesh Kumar Gandhi as Whole-time Directors of the Company for the period of five years with effect from 01.04.2022.

In accordance with the provisions of Section 152(6) (c) of the Companies Act, 2013 and the Company''s Articles of Association, Mr. Dinesh Kumar Agrawal and Mr. Vinod Pillai, Directors of the Company shall retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for reappointment.

29. CHANGES IN STATUS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES:

A. HIRA FERRO ALLOYS LIMITED (HFAL):

During the year under review, the Company acquired additional 37,48,117 equity shares of HFAL from the Promoter and Promoter Group of HFAL at an investment of H79.46 crores enhancing its total stake from 75.66% to 91.82%. Also, the Company has subscribed 11,00,00,000 9% Optionally Convertible Cumulative Redeemable Participating Preference Shares (“OCCRPPS”) of H10/- each at par, for repayment of borrowing (debt raised for setting up solar power plant) of HFAL. HFAL is operating a Ferro alloys manufacturing plant with capacity of 60,500 MT along with 20 MW captive thermal power plant and 8.5 MW Bio-Mass IPP power plant and IPP wind mill of 1.5 MW. Moreover, HFAL is also setting up of 55 MWp Solar Power Plant in the State of Chhattisgarh for captive consumption out of which 30 MWp Captive Solar PV Power Plant of HFAL has already commissioned and duly synchronized with the grid and charged on 29th March, 2023.

B. GODAWARI ENERGY LIMITED (GEL):

GEL does not have any business activity but have rights on a parcel of land located in Chhattisgarh, which was earlier acquired for setting up thermal power project, which was subsequently abandoned.

Our company is holding 100% equity share capital of the Company and has also subscribed to 6,90,00,000 0.01% Optionally Convertible Debentures (OCDs) of H10/- each aggregating to H69,00,00,000. During the

year GEL has redeemed 27,50,000 OCDs of H10 each and paid H2.75 Crores to the Company.

C. ALOK FERRO ALLOYS LIMITED (AFAL)

During the year the Company has acquired 37,79,220 equity shares of AFAL from the Promoters and Other Shareholders of AFAL at an investment of H126.98 crores comprising of 78.96% of the total equity of AFAL. Thus, AFAL has become subsidiary of the Company. AFAL is operating a Ferro alloys manufacturing plant with capacity of 14,500 MT and a captive thermal power plant of 8.5 MW capacity.

D. JAGDAMBA POWER AND ALLOYS LIMITED (JPAL)

Your Company had subscribed to 26,05,000 equity shares of JPAL few years back, in order to qualify for the captive user of the power generated by JPAL, as per Electricity Act and rules framed thereunder. During the year under review, your, Company has already acquired 25MW Thermal Power Plant owned by JPAL on slump sale basis and surrendered 26,05,000 equity shares of H10 each fully paid held by it in the Buyback Offer made by JPAL, since there was no requirement for holding the equity share capital in JPAL, consequent upon acquisition of Thermal Power Plant and accordingly, JPAL ceased to be an associate of the Company.

Other than above, your Company has not entered into any other new Joint Ventures nor terminated any existing Joint Ventures during the year under review. Similarly, other than JPAL, there were no change in the Associates of the Company.

30. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY, ASSOCIATES AND JOINT VENTURE COMPANIES:

Hira Ferro Alloys Limited (HFAL) - Subsidiary Company:

HFAL is engaged in the manufacture of ferro alloys with captive power generation. HFAL also operates IPP power plant (Bio-Mass & Wind Mill). The operating & financial highlights of HFAL for the year under review are as under:

Particulars

FY23

FY22

% Change

Production Volumes

- Ferro Alloys (in Metric Tons)

39647

47504

(-) 16.54%

- Pig Iron (in Metric Tons)

3509

0

100%

- Captive Power (Units in Crores)

1.42

16.20

(-) 91.23%

- IPP Power (Units in Crores)

6.57

9.92

(-) 33.77%

Sales Realizations (H/MT)

Net Sales (H In crores)

453.78

593.21

(-) 23.50%

EBIDTA (H In crores)

41.20

169.01

(-) 75.62%

PBT (H In crores)

29.45

158.49

(-) 81.42%

PAT (H In crores)

21.79

113.49

(-) 80.80%

The performance of the HFAL was impact due fall in ferro alloys prices during year as compared to last year due and substantial increase in coal price in domestic and international markets resulting into high increase in fuel prices. In view of high cost of generation of thermal power, the Company decided to shut down its Thermal Power Plant and drawn power from grid, which was comparatively cheaper and also shut down one of its ferro alloys furnace to upgrade the same with higher capacity furnace, which resulted into power operating volumes and profitability. The operating volumes are expected to improve during the current year, consequent upon the commissioning of solar power plant and increase in volumes in ferro alloys plant.

Alok Ferro Alloys Limited (AFAL) - Subsidiary Company:

AFAL is engaged in the manufacture of ferro alloys with captive power generation. The operating & financial highlights of AFAL for the year under review are as under:

Particulars

FY23

FY22

% Change

Production Volumes

Ferro Alloys (in Metric Tons)

5278

14257

(-) 62.98%

Net Sales (H In crores)

63.91

134.65

(-) 52.54%

EBIDTA (H In crores)

3.54

34.43

(-) 89.72%

PBT (H In crores)

1.21

32.39

(-) 96.26%

PAT (H In crores)

0.69

23.77

(-) 97.08%

In line with impacted on AFAL performance was also impacted on account fall in ferro alloys prices in domestic & international markets. AFAL also took shut down of its power plant during the year for replacement of power generating turbines with high efficiency turbine, which resulted into lower operating volumes and profitability. AFAL power plant has restarted effectively from second week of March, 2023 and the Company expects to operate normally during the current year,

Ardent Steel Private Limited (ASPL) - Associate Company:

Particulars

FY23

FY22

% Change

Iron Ore Pellets Volumes in Metric Tons

- Production

6,34,786

7,47,850

(-) 15.12%

- Sales

6,29,505

7,70,378

(-) 18.29%

Sales Realizations (H/MT)

Net Sales (H In crores)

479.25

842.80

(-) 43.14%

EBIDTA (H In crores)

37.37

151.00

(-) 75.25%

PBT (H In crores)

21.08

135.38

(-) 84.43%

PAT (H In crores)

15.51

99.00

(-) 84.33%

ASPL is engaged in manufacturing of Iron ore Pellets having plant in Odisha. The performance of ASPL also got impacted during the year in view of fall in Iron ore Pellet prices in domestic & international markets.

The performance and financial position of the Company''s subsidiaries namely Hira Ferro Alloys Limited, Alok Ferro Alloys Limited and Godawari Energy Limited, Associate Company namely Ardent Steel Private Limited for the Financial Year 2022-23 are also given in ANNEXURE 05.

The results of Associate Company viz., Chhattisgarh Ispat Bhumi Limited and Joint Venture Companies namely Raipur Infrastructure Company Limited and Chhattisgarh Captive Coal Mining Private Limited were not audited at the time of finalization of the Financial Statements of the company. These Companies does not have major commercial operations and therefore they have insignificant impact on the overall consolidated position of the Company.

Moreover, Godawari Energy Limited and Chhattisgarh Captive Coal Mining Private Limited have not yet commenced their commercial operations and their projects have been abandoned.

31. DIVESTMENT:

BUYBACK BY HIRA STEELS LIMITED (HSL)

The Company has surrendered 19,40,100 Equity Shares of H10 each fully paid under the Buyback offer made by Hira Steels Limited at an offer price of H30 per share.

32. DEPOSITS:

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

33. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES:

There were no contracts, arrangements or transactions entered into during fiscal 2023. Hence the information as required under the Companies Act, 2013 in the prescribed Form AOC-2 is not applicable.

34. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

35. INTERNAL FINANCIAL CONTROLS:

The Company has in place adequate internal & financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operations were observed.

36. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an internal control system commensurate with the size and scale and complexity of its operations. The scope and authority of Internal Audit functions have been defined in the Internal Audit scope of work to maintain its objectivity and independence, the Internal Audit functions 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 system, accounting procedures and policies of the Company and its subsidiaries. Based on the report of the Internal Auditors, process owners undertake corrective actions in their respective areas and thereby strengthen the control. Significant Audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

37. MAINTENANCE OF COST RECORDS:

The Company is required to maintain cost records of the Company as specified under Section 148 (1) of the Companies Act, 2013. Accordingly, the Company has properly maintained cost records and accounts.

38. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITIONAND REDRESSAL) ACT, 2013:

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (Permanent, Contractual, Temporary, Training) are covered under this Policy. However, no complaints have been received during the year 2022-23.

39. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Board of Directors have established ''Whistle Blower Policy'' and ''Code of Conduct'' for the directors & employees of the Company as required under the provisions of Sec. 177 of the Companies Act, 2013 read with Rule 7 of the Companies (Meeting of Board and its Powers) Rules, 2014 and Regulation 22 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The said Policy has been properly communicated to all the directors and employees of the Company through the respective departmental heads and the new employees are being informed about the Whistle Blower Policy by the Personnel Department at the time of their joining.

41. CORPORATE GOVERNANCE REPORT:

Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance and a certificate of non-disqualification of directors from Practicing Company Secretary forming an integral part of this Report is given as ANNEXURE 07.

42. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT:

The ''Business Responsibility and Sustainability Report'' (BRSR) of your Company for the year 202223 forms part of this Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is given as ANNEXURE 08. Your Company strongly believes that sustainable and inclusive growth is possible by using the levers of environmental and social responsibility while setting targets and improving economic performance to ensure business continuity and rapid growth.

43. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a separate management discussion and analysis report which forms an integral part of this Report is given as ANNEXURE 09.

44. DETAILS OF APPLICATIONS MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE 2016:

There are no applications made during the financial

year 2022-23 by or against the company and there are no proceedings pending under the Insolvency and Bankruptcy Code 2016.

45. DETAILS OF DIFFERENCES BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF:

Your company has not made any one time settlement with any of its lenders.

46. BOARD POLICIES:

The details of the policies approved and adopted by the Board as required under the Companies Act, 2013 and SEBI Regulations are provided in ANNEXURE 10.

47. SECRETARIAL STANDARDS:

The Company has followed the applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ''Meetings of the Board of Directors'' and ''General Meetings'' respectively.

48. ACKNOWLEGEMENTS:

The Board expresses its sincere gratitude to the shareholders, bankers/lenders, Investors, vendors, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.


Mar 31, 2022

Your Directors have pleasure in presenting the 23rd Annual Report on the business & operations of the Company together with the Standalone and Consolidated Audited Financial Statement for the year ended 31st March 2022.

1. FINANCIAL HIGHLIGHTS:

H In Crores

Particulars

Consolidated

2021-22

2020-21 1

2021-22

2020-21

Gross Revenue from operations

5,074.60

3,640.87

5,399.18

3,957.64

Other Income

18.34

5.20

29.37

3.39

Total Revenue

5,092.94

3,646.07

5,428.55

3,961.03

Operating expenses

3,293.62

2,596.86

3,535.01

2,820.64

Profit before Interest, Depreciation, Tax and Amortization (EBIDTA)

1,799.32

1,049.21

1,893.54

1,140.39

Finance Costs

17.35

109.99

19.69

114.96

Depreciation and amortization expenses

101.75

96.49

104.7

108.96

Profit/(loss) before exceptional item and tax

1,680.22

842.73

1,769.15

916.47

Add: Share of Profit/(Loss) of Associates & Joint Ventures net of tax

0.00

0.00

65.17

30.03

Exceptional item

98.74

63.00

98.74

0.00

Profit/(Loss) Before Taxation

1,778.97

905.73

1,933.07

946.50

Taxation (including Deferred Tax)

428.00

279.97

451.15

307.07

Profit/(Loss) after Taxation (PAT)

1,350.96

625.76

1,481.92

639.43

2. REVIEW OF PERFORMANCE:

Your Company''s performance during the year under review has been record high and highest ever in the history of the Company, in view of higher demand for iron ore pellets in international and domestic market, coupled with higher demand of sponge iron & other finished products. In view of higher demand, the realizations of all the products have also increased especially in iron ore pellets in the first half of the year and sponge iron, ferro alloys & finished steel products in the second half of the year, as compared to previous year which in turn contributed towards increased operating margins/EBIDTA of the Company. As communicated in our last reports, the Company''s efforts for making high grade pellets has been successful and also contributed to the profitability of the Company. Given the above backdrop, the highlight of standalone & consolidated results are given below:

Standalone Operations:

• Revenue from operations for the year increased by 39.38% to H5,074.60 Crores as compared to H3,640.87 Crores achieved during previous Financial Year.

• EBIDTA for the year increased by 71.49% to H1799.32 Crores as compared to EBIDTA of H1049.21 Crores achieved in previous Financial Year.

• Profit after tax increased by 115.89% to H1350.96 Crores (excluding profit from sale of investments) as compared to net profit of H625.76 Crores in previous Financial Year.

Consolidated Operations:

• Revenue from operations for the year increased by 36.42% to H5399.18 Crores as compared to H3957.64 Crores during the previous Financial Year;

• EBIDTA for the year increased by 66.04% to H1893.54 Crores as compared to EBIDTA of H1140.39 Crores achieved during previous Financial Year.

• Profit after tax during the year increased by 131.76% to H1481.92 Crores as compared to net profit after tax of H639.43 Crores during previous Financial Year.

The detailed comments on the operating & performance of the Company, during year under review has been given in the Management Discussions & Analysis.

3. DIVIDEND:

Your Company has paid an interim dividend of H5 per equity share of H10/- each (previous year H5/- per share), before subdivision of equity shares & issue of bonus shares and

5. WITHDRAWLOF SCHEME OF ARRANGEMENT:

The Board in its meeting held on 14.09.2021 has withdrawn the Scheme of Arrangement for demerger of power business of JPAL and merge the same with the company. JPAL continues to supply power to the Company under the PPA, which will continue till an alternate proposal is mutually agreed between the parties for acquisition of power business by the Company.

6. EXPANSION/NEW PROJECTS:

Your Company''s Ari Dongri iron ore mine capacity has been enhanced during the year from 1.4 million ton to 2.3 million tons consequent upon receipt of environment and other regulatory approvals and has started commercial operations of the enhanced capacity. In order to improve the operating efficiency of mine & quality of iron ore, your Company has taken up project for setting up iron ore crushing & beneficiation facilities at Ari Dongri mines at a capex of H125 crores, which is progressing well and the same is expected to be completed by end of Q3FY23.

The Company''s project to enhance the capacity of steel melting shop (steel billets) from 0.4 million to 0.6 million tons at a cost of H80 crores is kept on hold for change in business plan for manufacture of steel slab and rolling mill for manufacture of low width strips, which is under evaluation stage. The Company is expected to finalise the modification plan within next two months along-with revised amount of capex. The capacity enhancement project shall be taken up after the plan is finalised by Q2FY23.

Your Company is also setting up 95MW of captive solar PV power plant at Rajnandgaon, Chhattisgarh at a cost of H370 crores to meet the enhanced power requirement for integrated steel plant & iron ore mines and also to replace the power purchased from grid at high cost. The project will support the green initiatives of the Company and reduce the carbon foot print. Out of 95 MW solar power project, the construction of 70 MW with installation of modules has been completed and awaiting synchronisation with the grid and expected to start generation before the end of Q1FY23. The balance 25MW project is expected to be commissioned by Q3FY23.

In addition to above, your Company has also taken up project for replacement of old power generation turbine with new energy efficient turbine at cost of H86 crores at the existing integrated steel plant, which is expected to be completed by end of FY23. This will help in generating additional 8MW power without additional fuel consumption and save cost.

Further the Board of Directors of the Company has approved acquisition of power business of JPAL, comprising of 25MW thermal power plant located at Industrial area, Phase - I, Raipur, Chhattisgarh as a going concern on slump sale basis at a cost of H70 crores plus value of net current assets as on the transfer date. It may be mentioned that JPAL power

recommended final dividend of H8.50 per equity share of H5/- each (previous year H13.5 per equity share of face value of H10/-) on the enhanced paid up capital of the Company after subdivision of equity shares & issue of bonus shares for the financial year 2021-22. The outflow of funds on account of interim dividend was H17.62 crores (previous year H17.62 crores) and final dividend shall be H119.80 crores (previous year H45.57 crores) The final dividend for the financial year 2021-22, if approved, by the shareholders of the company in the ensuing Annual General Meeting, the same will be paid in due course as per the applicable provisions.

4. SHARE CAPITAL:

During the year under review, the shareholders in their Extra Ordinary General Meeting (EGM) held on 14th October, 2021 has approved the:

1. Alteration of capital Clause in Memorandum of Association (MOA) consequent upon sub division.

2. Increase in Authorised Share Capital of the Company from H53,00,00,000 to H74,00,00,000.

3. Sub division of 1 (One) equity share of H10/- each into 2 (Two) equity share of H5/- each.

4. Issue of Bonus Shares of H5/- each fully paid up for every 1 (One) Equity Shares.

Consequently the Authorised Share Capital has been increased from H53,00,00,000 to H74,00,00,000 divided into 14,16,00,000 Equity Shares of H5/- each and 32,00,000 Preference Shares of H10/- each.

As on 31st March, 2022, the paid up Equity Share Capital of the company was H70.47 Crores divided into 14,09,44,988 Equity Shares of H5 each/-, consequent upon sub division and issue of bonus shares.

During the year under review, the Company has not issued any shares with differential voting rights nor granted stock options nor sweat equity. As on 31st March 2022, the company has not issued any convertible instruments and none of the Directors of the Company hold convertible instruments of the Company.

The equity shares of the company representing 99.99% of the share capital are dematerialized as on 31st March, 2022. The dematerialization facility is available to all shareholders of the company from both the depositories namely National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Depositories has allotted ISIN: INE177H01021 due to sub division of Equity shares of the Company for dematerialization of shares of the company.

plant is captive power plant for GPIL and GPIL has been purchasing power from JPAL since 2018. The acquisition of power business will help the Company to be self-sufficient in meeting power requirement of the Company along-with the additional power to be generated by captive solar power plant and upon replacement of old turbine with new energy efficient turbine.

Your Company is also proposing to set up a new green field steel plant, which is in initial stage. The Company has identified the land and applied to the state government for allotment of land for the project and also applied for environment and other approvals from the concerned regulatory authorities. The Company initially plans to set a 1-million-ton Pig Iron plant backed by captive iron ore, pellet plant and sintering facilities. The final project configuration shall be decided closure to the commencement of the implementation of the project upon getting land allotment and upon obtaining regulatory approvals. In order to meet the captive iron ore requirement for the expansion project, the Company has initiated process for environment approval for enhancement in capacity from 3 million tons to 5 million tons. It may be mentioned, based on the exploration activities undertaken by the Company, its proven iron ore reserves in both the mines is estimated to be 165 million tons, which give raw material security for long period of time. The Company has balance life of mines to over 30 years.

7. ANNUAL RETURN:

In accordance with the Companies Act, 2013, the annual return in the prescribed format is available at http:// godawaripowerispat.com/performance/shareholders/ annualreturn/

8. NUMBER OF MEETINGS OF BOARD:

During the period under review, eight Board Meetings were convened and held, the details of which are given in the Corporate Governance Report.

9. DIRECTORS’ RESPONSIBILITY STATEMENT:

Your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013 based on the representations received from the operating management and Chief Financial Officer of the Company:

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

b) That your Directors have selected such accounting policies and applied them consistently, and made judgment 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;

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

d) That your Directors have prepared the annual accounts on a going concern basis;

e) That your Directors have laid down proper internal financial controls to be followed by the Company and that such financial controls are adequate and were operating effectively; and

f) That your Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

10. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTOR:

All Independent Directors of the Company have given declarations as required under the provisions of Section 149 (7) of the Companies Act, 2013 stating that they meet the eligibility criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and Regulation 25 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

11. SEPERATE MEETING OF INDEPENDENT DIRECTORS:

During the year under review, the Independent Directors held their separate meeting on 28th May, 2022 inter alia, to discuss:

• Review the performance of Independent Directors.

• Review the performance of the Non-Independent Directors.

• Review the performance of the committees and Board as a whole.

• Review the performance of the Chairman of the Company, taking into account the views of Executive Directors and Non Executive Directors.

• Assess the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties

12. NOMINATION AND REMUNERATION COMMIITEE AND ITS POLICY:

Company''s Policy on Directors Appointment and Remuneration including criteria for determining qualification, positive attributes, independence of directors and other matters provided under section 178(3) of the Companies Act, 2013 is also placed at the website of the Company at www. godawaripowerispat.com.

13. AUDITORS:

Statutory Auditors

Pursuant to the provisions of Section 139 of the Act and the rules framed thereafter, M/s JDS and Co., Chartered Accountants, were appointed as Statutory Auditors of the Company for a term of five consecutive Financial Years from the conclusion of Annual General Meeting held on 25.09.2017 till the conclusion of the Annual General Meeting of the Company to be held in the year 2022.

The Audit Committee and Board of Directors of the Company shall consider in their respective next meetings, the proposal for reappointment of M/s. JDS & Co., Chartered Accountants, Firm Regn. No. 018400C as Statutory Auditors of the company for the period of second term of five consecutive Financial Years from the conclusion of ensuing Annual General Meeting to be held in the year 2022 to the conclusion of Annual General Meeting to be held in the year 2027 after obtaining a certificate from M/s. JDS & Co. to the effect that if their appointment is made, the same would be within the limits prescribed under Section 141 (3) (g) of the Companies Act, 2013 and that they are not disqualified for re-appointment and also satisfies the criteria as mentioned under Section 141 and they have obtained peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Record and Audit) Amendment Rules 2014 M/s Sanat Joshi & Associates has been appointed as cost auditors for conducting Cost Audit for the Financial Year under review.

Subsequent to change in designation of Mr. Dinesh Kumar Gandhi from Non Executive to Executive Director of the Company, the Nomination and Remuneration committee has been reconstituted by the Board of directors in its meeting held on 09.04.2022, by inducting Ms. Bhavna Govindbhai Desai, Independent Non-Executive Director, as member of the Nomination and Remuneration Committee to comply with the provisions of Regulation 19(1) of SEBI (Listing Obligations And Disclosure Requirements) Regulations, 2015.

Presently it consists of following three Independent Directors:

S. No.

NAME

DESIGNATION

1

Shri Bhirgu Nath Ojha

Chairman and Member - Independent - Non Executive Director

2

Shri Shashi Kumar

Member- Independent -Non Executive Director

3

Ms. Bhavna Govindbhai Desai

Member- Independent -Non Executive Director

More details are given in the Corporate Governance Report.

Internal Auditors

M/s. OPS & Co, Chartered Accountants were appointed as Internal Auditors for the Financial Year under review.

Secretarial Audit

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 CS Tanveer Kaur Tuteja, Practising Company Secretary, (FCS 7704, CP 8512) to undertake the Secretarial Audit of the Company.

14. AUDITOR’S REPORTS:

• Statutory Auditors

There are no qualifications, reservations, adverse remarks or disclaimers in the statutory Auditor''s Report on the financial statements of the Company for the Financial Year 2021-22 and hence does not require any explanations or comments by the Board.

• Frauds reported by the Auditors:

No frauds have been reported by the Auditor during the Financial Year 2021-22.

• Secretarial Audit

The Secretarial Audit Report received from the Secretarial Auditor of the Company for the Financial Year 2021-22 is annexed herewith as ANNEXURE 01.

The Company''s subsidiary company namely Hira Ferro Alloys Limited (HFAL) being the material subsidiary of the Company, in accordance with Regulation 24A of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) 2015 has also obtained Secretarial Audit Report which is annexed herewith as ANNEXURE 02.

There are no qualifications, reservations, adverse remarks or disclaimers in the Secretarial Auditor''s Report on secretarial and other applicable legal compliances to be made by the Company for the Financial Year 2021-22 and hence does not require any explanations or comments by the Board.

15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The particulars of investments made and loans given by the Company as covered under the provisions of Section 186 of the Companies Act, 2013 are given in Standalone Financial Statements (Ref. Notes 5, 6 and 11). Your Company has not extended corporate guarantee on behalf of any other Company.

16. TRANSFER TO RESERVES:

Your Company has not transferred any amount to the General Reserves Account during the Financial Year 2021-22.

17. TRANSFER OF UNPAID & UNCLAIMED DIVIDEND & SHARES TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Section 125 of the Companies Act, 2013, the outstanding amount of dividend which remained unpaid or unclaimed for a period of seven years and shares whose dividend was unpaid/unclaimed for seven consecutive years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund.

During the year under review, the Company has credited the Interim and final dividend amount of H 24,4451/- and H82,813/-respectively to the Investor Education and Protection Fund (IEPF) pursuant to Section 125 of the Companies Act, 2013/ Section 205C of the Companies Act, 1956 read with the Investor Education and Protection Fund (Awareness and Protection of Investors) Rules, 2001 relating to the Dividend paid by the Company for FY 2013-14.

During the year under review, the Company has also transferred 3541 Equity Shares to the Investor Education and Protection Fund (IEPF) relating to 51 shareholders of the Company, whose dividends were unclaimed/unpaid for seven consecutive years, pursuant to Section 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund (Awareness and Protection of Investors) Rules, 2001 and the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 relating to the Interim Dividend and Final Dividend paid by the Company for FY 2013-14.

During the year under review, the Company has subdivided its Equity Shares in the ratio of 2:1 and the Corporate Action for Sub-Division was executed on 28.10.2021 including NSDL IEPF account in respect of Sub-division of Shares. Also, your company has credited/allotted Bonus Shares in the ratio of 1:1 on 30.10.2021 and the corporate action for CDSL Account was executed on 02.11.2021 and for NSDL Account was executed on 03.11.2021 including NSDL IEPF account in respect of Bonus Shares allotted.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company, as on 28th August 2021 (date of last Annual General Meeting) on the Company''s website (www.godawaripowerispat.com at Investors Information - Unclaimed Dividend) and on the website of the Ministry of Corporate Affairs.

Any person, whose unclaimed or unpaid amount has been transferred by the Company to IEPF may claim their refunds to the IEPF authority. For claiming such amount, claimant needs to file form IEPF-5 along with requisite documents. The detailed procedure for claiming shares and Dividend

Amount has been uploaded on the Website of the Company (www.godawaripowerispat.com at Investors Information -Unclaimed Dividend) and also available on the website of IEPF (www.iepf.gov.in).

The Company has initiated necessary action for transfer of shares in respect of which dividend has not been paid or claimed by the members consecutively since 2013-14.

The Nodal Officer for the purpose of IEPF is Company Secretary and the website address is www.godawaripowerispat.com.

18. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION:

There are no materials changes and commitments affecting the financial position of the Company occurred between the 01st April, 2022 and date of this report except imposition of export duty on iron ore, iron ore concentrates, iron ore pellets and other steel products.

19. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as ANNEXURE 03.

20. AUDIT COMMITTEE COMPOSITION:

The Audit Committee was reconstituted pursuant to resignation of Mr. Biswajit Choudhuri from the Directorship and Chairmanship/Membership from the board of the company w.e.f 16.10.2021. Presently it consists of following four Independent Directors all having financial literacy.

S. No.

NAME

DESIGNATION

1

Mr. Shashi Kumar

Chairman (Independent Non-Executive Director)

2

Mr. Bhrigu Nath Ojha

Member (Independent Non-Executive Director)

3

Mr. Hari Shankar Khandelwal

Member (Independent Non-Executive Director)

4

Ms. Bhavna Govindbhai Desai

Member (Independent Non-Executive Director)

More details are given in the Corporate Governance Report.

21. RISK MANAGEMENT COMMITTEE:

The Risk Management Committee was reconstituted pursuant to resignation of Mr. Biswajit Choudhuri from the Directorship and Chairmanship/Membership from the board of the company with effect from 16.10.2021. Presently it consists of Two Independent Directors, Two Executive Directors and Two Key Managerial Personnel of the company.

More details are given in the Corporate Governance Report.

The risk management issues are discussed in detail in the report of Management Discussion and Analysis.

22. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Company has adopted a Risk Management Policy to identify and evaluate business risks associated with the operations and other activities of the Company and formulated risk mitigations strategies.

23. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:

The Company has constituted a CSR Committee of the Board (“CSR Committee”) pursuant to resolution of the Board dated 15.03.2014.

The Board of Directors at its meeting held on 15.03.2014 approved the powers, role and terms of reference of the CSR Committee in accordance with the provisions of Section 135 of the Companies Act, 2013, and the Board in its meeting held on 31.01.2022 have approved the revised policy framed as per amendments inserted by the Companies (Amendment) Act, 2019, Companies (Amendment) Act, 2020 and Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 and the same has been disclosed on the website of the Company at http://godawaripowerispat.com/wp-content/ uploads/2022/02/CSR-Policy.pdf. The CSR Committee consists of One Independent Director and Two Executive Directors. The detailed composition of the members of the CSR Committee at present is given below:

S. No.

NAME

DESIGNATION

1

Mr. Shashi Kumar

Chairman (Independent Non-Executive Director)

2

Mr. Abhishek Agrawal

Member (Executive Director)

3

Mr. Vinod Pillai

Member (Executive Director)

The committee met twice during the year 2021-22 and the attendance of the members at these meetings is as follows:

Name of the Chairman/ Member and Date of Meeting

24.05.2021 30.10.2021

Mr. Shashi Kumar

Present Present

Mr. Abhishek Agrawal

Present Absent

Mr. Vinod Pillai

Present Present

CSR Committee’s Responsibility Statement:

CSR Committees hereby states that the implementation and monitoring of CSR activities, is in compliance with CSR objectives and Policy of the Company.

24. ANNUAL REPORT ON CSR ACTIVITIES:

The Annual Report on CSR activities initiated and undertaken by the Company during the year under review is annexed herewith as an ANNEXURE-04.

25. ANNUAL EVALUATION OF BOARD ETC.:

The Nomination and Remuneration Committee has formulated criteria for evaluation of the performance of the each of the directors of the Company. On the basis of said criteria, the Board and all its committees and directors have been evaluated by the Board of the Directors and Independent Directors of the Company.

26. RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into by the Company during the year under review were on arms length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with promoters, directors, key managerial personnel or related parties which may have a potential conflict with the interest of the Company at large.

27. CHANGES IN NATURE OF BUSINESS:

The Company has been engaged in the business of mining of captive iron ore and manufacturing the Iron Ore Pellets, Sponge Iron, Steel Billets, Wire Rods, HB Wires with generation of Power for captive consumption. There is no change in the nature of business of the Company during the year under review.

28. CHANGES IN DIRECTORS & KEY MANAGERIAL PERSONNELS:

There are no changes in the Directors and Key Managerial Personnel of the company after last report in the Company till 31.03.2022. However the Board of Directors in its meeting held on 09.04.2022 has changed the designations of Mr. Siddharth Agrawal and Mr. Dinesh Kumar Gandhi from NonExecutive Directors to Executive Directors with effect from 01.04.2022. Also, the designation of Mr. Vinod Pillai has been changed from Executive Director to Non- Executive Director w.e.f. 01.04.2022.

Mr. Prakhar Agrawal also resigned from the Directorship of the company with effect from 01.04.2022; the Board of Directors accepted his resignation and placed on record its deep sense of appreciation for the services rendered and guidance given by him.

In accordance with the provisions of Section 152(6) (c) of the Companies Act, 2013 and the Company''s Articles of Association, Mr. Abhishek Agrawal and Mr. Dinesh Kumar

Gandhi, Directors of the Company shall retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for reappointment.

29. CHANGES IN STATUS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES:

A. GODAWARI GREEN ENERGY LTD (GGEL):

The Board of Directors in its meeting held on 19.02.2022 has approved in-principle proposal for divestment of its entire shareholding in Godawari Green Energy Limited (GGEL) a Material Subsidiary by way of sale/transfer to Virescent Renewable Energy Trust, an Infrastructure Investment Trust, represented and acting through its investment manager, Virescent Infrastructure Investment Manager Private Limited (“Buyer”). The Shareholders in their Extra Ordinary General Meeting held on 16.03.2022 has approved the proposal for divestment of Company''s entire shareholding in Godawari Green Energy Limited (GGEL) a Material Subsidiary.

Accordingly, on 17.03.2022 your company has sold 2,52,47,000 equity shares held in Godawari Green Energy Limited to Virescent Renewable Energy Trust, an Infrastructure Investment Trust. Thus, Godawari Green Energy Limited has ceased to be subsidiary of the company w.e.f. 17.03.2022.

B. HIRA FERRO ALLOYS Ltd (HFAL):

During the year under review, HFAL became subsidiary of your company. The Company has acquired additional 80,54,621 equity shares of HFAL at an investment of H169.98 crores taking its total stake from 48.45% to 76.45%. HFAL is operating ferro alloys manufacturing plant with capacity of 60500 MT along-with 20 MW captive thermal power plant. HFAL also has 8.5 MW Bio Mass IPP power plant and wind mill of 1.5 MW. HFAL is in the process of setting up 70MW Captive solar PV power plant at an investment of H240 Crores. The project is proposed to be funded by equity of H70.20 crores (subscribed by your Company) & debt of H170 crores from bank.

C. ACQUISITION IN GEL:

Your company has acquired all the shares of Godawari Energy Limited (GEL) from its shareholders thus GEL becoming a wholly owned subsidiary of your company with effect from 22.07.2021. GEL does not have any business activity but have rights on a parcel of land located in Chhattisgarh, which was earlier acquired for setting up thermal power plant, which was subsequently abandoned.

Other than above, your Company has not entered into

any other new Joint Venture nor terminated any existing Joint Venture during the year under review.

There were no changes, in the status of Associates of the Company.

30. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY, ASSOCIATES AND JOINT VENTURE COMPANIES:

Hira Ferro Alloys Limited (HFAL) - Subsidiary Company:

During FY 2021-22, HFAL produced 47504 MTs of Ferro Alloys as compared to 35304 MTs in FY 2020-21 & sold 45066 MTs of Ferro Alloys in FY 2021-22 as compared to 36513.02 MTs in FY 2020-21. During FY 2021-22, HFAL also generated 16,19,96,285 units of power in its Thermal Power Plant as compared to 15,82,76,400 units in FY 2020-21, 9,04,58,760 units of power in its Bio-mass Power Plant as compared to 8,12,47,560 units in FY 2020-21 and 27,44,343 units of power in its Wind Power as compared to 29,24,697 units in FY 2020-21.The Company achieved gross sales of H593.21 crores, EBIDTA of H169.01 Crores & PAT of H113.49 crores during year as compared to gross sales of H314.46 crores, EBIDTA of H33.66 Crores & PAT of H21.14 crores during the previous year. The performance of the Company was led by higher demand for ferro alloys in domestic & global markets and which resulted into higher production volumes and better realisations and consequently contributed to the higher profitability 436.85% YoY.

Ardent Steel Private Limited (ASPL) - Associate Company:

During FY 2021-22, ASPL produced 747850 MTs of iron ore pellets as compared to 705804 MTs in FY 2020-21 & sold 770378 MTs of pellets in FY 2021-22 as compared to 689882 MTs in FY 2020-21. The Company achieved gross sales of H842.80 crores, EBIDTA of H151.00 Crores & PAT of H99.00 crores during year as compared to gross sales of H538.29 crores, EBIDTA of H176.97 Crores & PAT of H111.14 crores during the previous year. The PAT was impacted due to increase in input cost during the year.

Jagadamba Power and Alloys Limited (JPAL) -Associate Company:

During FY22, the JPAL generated 172.11million units as compared to 162.75 million units generation in FY21. The net revenue, EBIDTA & Profit/(Loss) for the period of the Company stood at H75.01 crores, H8.66 crores & H4.65 crores respectively during the year as compared to H63.82 crore, H9.48 crore & H5.08 crore respectively during previous year.

The performance and financial position of the Company''s subsidiaries namely Hira Ferro Alloys Limited and Godawari

Energy Limited, Associate Companies namely Ardent Steel Private Limited and Jagdamba Power & Alloys Limited for the Financial Year 2021-22 are also given in ANNEXURE 05.

The results of Associate Company viz., Chhattisgarh Ispat Bhumi Limited and Joint Venture Companies namely Raipur Infrastructure Company Limited and Chhattisgarh Captive Coal Mining Private Limited were not audited at the time of finalization of the Financial Statements of the company are not given since they have insignificant impact on the overall consolidated position of the Company.

However, Godawari Energy Limited and Chhattisgarh Captive Coal Mining Private Limited have not yet commenced their commercial operations and their projects have been abandoned.

31. DEPOSITS:

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

32. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES:

There were no contracts, arrangements or transactions entered into during fiscal 2022. Hence the information as required under the Companies Act, 2013 in the prescribed Form AOC-2 is not applicable.

33. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

34. INTERNAL FINANCIAL CONTROLS:

The Company has in place adequate internal & financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operations were observed.

35. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an internal control system commensurate with the size and scale and complexity of its operations. The scope and authority of Internal Audit functions have been defined in the Internal Audit scope of work to maintain its objectivity and independence, the Internal Audit functions 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 system, accounting procedures and policies of the Company and its subsidiaries. Based on the report of the Internal Auditors, process owners undertake corrective actions in their respective areas and thereby strengthen the control. Significant Audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

36. MAINTENANCE OF COST RECORDS:

The Company is required to maintain cost records of the Company as specified under Section 148 (1) of the Companies Act, 2013. Accordingly, the Company has properly maintained cost records and accounts.

37. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (Permanent, Contractual, Temporary, Training) are covered under this Policy. However, no complaints have been received during the year 2021-22.

38. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Board of Directors have established ''Whistle Blower Policy'' and ''Code of Conduct'' for the directors & employees of the Company as required under the provisions of Sec. 177 of the Companies Act, 2013 read with Rule 7 of the Companies (Meeting of Board and its powers) Rules, 2014 and Regulation 22 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the year Mr. Biswajit Chodhuri resigned from the Chairmanship of the Audit Committee and Mr. Shashi Kumar was appointed as the Chairman of Audit Committee. The Board of Directors of the Company in its meeting held on 31.01.2022 has revised the details of the Chairman of the Audit Committee mentioned in Clause 8 of the existing Whistle Blower Policy.

The said revised policy has been properly communicated to all the directors and employees of the Company through the respective departmental heads and the new employees are being informed about the Vigil Policy by the Personnel Department at the time of their joining.

39. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 (12) read with Rule 5 (1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is given in ANNEXURE 06. The Statement showing the names and other particulars of the employees of the Company as required under Rule 5 (2 &3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not required to be furnished since none of the employees of the Company has received remuneration in excess of the remuneration mentioned in the above mentioned Rule 5 (2) during the Financial Year 2021-22 except Mr. B.L Agrawal (Managing Director), Mr. Abhishek Agrawal (Executive Director) and Mr. Dinesh Agrawal (Executive Director) whose details are given below:

Particulars

Details

Name

Mr. Bajrang Lal Agrawal

Mr. Abhishek Agrawal

Mr. Dinesh Agrawal

Designation

Managing Director

Whole Time Director

Whole Time Director

Remuneration Paid

H2.40 Crore per annum

H1.98 Crore per annum

H1.92 Crore per annum

Nature of employment, Whether contractual or otherwise

Permanent

Permanent

Permanent

Qualifications and Experience of the employee

B.E (Electronic) and has a experience of more than 40 years in cement, steel, power and mining sectors.

B.E. (Electronics) & M. Sc International Business from University of Leeds and has experience of more than 8 years.

Electronic Engineer and experience in business for over 15 years.

Date of commencement of employment

17.08.2002

09.11.2011

21.09.1999

The age of such employee

68

38

51

The last employment held by such employee before joining the Company

N.A.

N.A.

N.A.

The percentage of equity shares held by the employee in the Company within the meaning of clause (iii) of sub rule (2) above

Individually Holding:4.91% Spouse Holding: 4.33% Total holding along with spouse: 9.24%

Individually

Holding:0.24%

Individually

Holding:5.24%

Whether any such employee is a relative of any director or manager of the Company and if so, name of such director or manager

Shri Abhishek Agrawal and Shri Siddharth Agrawal

Shri Bajrang Lal Agrawal and

Shri Siddharth Agrawal

None

40. CORPORATE GOVERNANCE REPORT:

Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance and a certificate of non-disqualification of directors from Practicing Company Secretary forming an integral part of this Report is given as ANNEXURE 07.

41. BUSINESS RESPONSIBILITY REPORT:

The ''Business Responsibility Report'' (BRR) of your Company for the year 2021-22 forms part of this Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is given as ANNEXURE 08. Your Company strongly believes that sustainable and inclusive growth is possible by using the levers of environmental and social responsibility while setting targets and improving economic performance to ensure business continuity and rapid growth.

42. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a separate management discussion and analysis report which forms an integral part of this Report is given as ANNEXURE 09.

45. BOARD POLICIES:

43. DETAILS OF APPLICATIONS MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE 2016:

There are no applications made during the financial year 202122 by or against the company and there are no proceedings pending under the Insolvency and Bankruptcy Code 2016.

44. DETAILS OF DIFFERENCES BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF:

Your company has not made any one time settlement with any of its lenders.

The details of the policies approved and adopted by the Board as required under the Companies Act, 2013 and SEBI Regulations are provided in ANNEXURE 10.

46. SECRETARIAL STANDARDS:

The Company has followed the applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ''Meetings of the Board of Directors'' and ''General Meetings'' respectively.

47. ACKNOWLEGEMENTS:

The Board expresses its sincere gratitude to the shareholders, bankers/lenders, Investors, vendors, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.


Mar 31, 2018

To the Members,

The Directors have pleasure in presenting the 19th Annual Report on the business & operations of the Company together with the

Standalone and Consolidated Audited Financial Statement for the year ended 31st March 2018.

1. HIGHLIGHTS OF PERFORMANCE

Standalone Operations:

- Revenue from operations for the year increased by 25.87% to Rs. 2184.61 Crores as compared to Rs. 1735.66 crores achieved during previous financial year.

- EBITDA for the year increased by 149.03% to Rs. 440.48 Crores as compared to EBITDA of Rs. 176.88 Crores achieved in previous financial year.

- Profit after tax increased to Rs. 181.95 Crores as compared to net loss of Rs. 77.44 Crores in previous year.

Consolidated Operations:

- Revenue from operations for the year increased by 29.83% to Rs. 2588.84 Crore as compared to Rs. 1994.08 Crore during the previous financial year;

- EBITDA for the year increased by 97.85% to Rs. 605.56 Crores as compared to EBITDA of Rs. 306.07 crores achieved during previous financial year.

- Profit after tax during the year increased to Rs. 214.69 Crores as compared to net loss after tax of Rs. 73.62 Crore during last financial year.

2. FINANCIAL RESULTS

Rs. in Crores

Particulars

Standalone

Consolidated

2017-18

2016-17

2017-18

2016-17

Gross Revenue from operations

2184.61

1735.66

2588.84

1994.08

Other Income

8.21

13.74

8.66

15.30

Total Revenue

2192.82

1749.40

2597.50

2009.38

Operating expenses

1752.34

1572.52

1991.94

1703.31

Profit before Interest, Depreciation, Tax and Amortization (EBIDTA)

440.48

176.88

605.56

306.07

Finance Costs

184.81

176.70

263.31

259.15

Depreciation and amortization expenses

89.49

78.18

131.80

120.09

Add: Share of Profit/(Loss) of Associates & Joint Ventures (after tax)

-

-

3.40

0.27

Profit/(loss) before exceptional item and tax

166.18

(78.01)

213.85

(72.90)

Exceptional item

5.52

-

5.52

-

Profit/(Loss) Before Taxation

160.66

(78.01)

208.33

(72.90)

Taxation (including Deferred Tax)

(21.28)

(0.57)

(6.36)

0.72

Profit/(Loss) after Taxation (PAT)

181.95

(77.44)

214.69

(73.62)

Other Comprehensive Income

0.73

0.04

19.67

(0.44)

Total Comprehensive Income for the period comprising profit/ (loss) & other comprehensive income for the period

182.68

(77.40)

234.36

(74.06)

3. REVIEW OF PERFORMANCE

The financial year 2017-18 was yet another challenging year for the economy. While the domestic economy was looking for improvement post demonetization led slow-down in growth, the same was delayed caused by the further disruptions followed by implementation of Goods and Service Tax (GST). While GST in long term is beneficial for domestic economy, the implementation of the same delayed due to initial teething troubles, the process of industrial recovery by couple of months. The domestic iron & steel which was on path of recovery post demonetization on account of improvement in global growth outlook and supply constrained due to various measures taken by Chinese Government like phasing out of high polluting steel plants etc., which took further momentum due decisive action by the Chinese State Government on environmental curb, the finished steel prices saw further improvement in demand for steel products resulting into recovery in steel prices. The domestic steel demand also improved on account various measures taken by Government of India during past couple of years towards infrastructure development, low cost housing, railways etc. and consumption led growth in demand from automobiles sectors etc. which is evident from higher production volume and consumption growth.

Further with improvement in consumption led demand, finished steel prices also improved during the last 4 months of the year under review to pre-2013-14 years resulting into further improvement in steel industry’s financial performance in general and your Company’s performance in particular leading to increase in net sales by 38% and EBIDTA 149% which was highest ever in the history of the Company.

Stand-alone Operations:

The performance of your Company during the year under review substantially improved due to buoyancy in the steel demand and consumption in domestic and global markets. The Company’s performance during the year was highest ever on all parameters like sales, operating margins, EBIDTA and Net Profit. The highlights of the financial performance for the year are as under:

a) Net Sales Revenue increased by 37.78% to Rs. 2130.18 crores from Rs. 1546.02 crores recorded in previous year. The top line has improved on account of higher production volumes coupled with increase in prices of finished products. The Company achieved highest ever production volume of iron mining, iron ore pellets and wire rods and finished wires etc.

b) Operating Profit margins during the year under review increased to 21.20% as compared to 11.34% in previous year.

c) The Company registered Net Profit of Rs. 202.90 crores as against net Loss after tax of Rs. 77.44 crores during the previous year. The higher profit compared to previous year was mainly due to higher production volumes, demand growth and better price realization across all the product line of the Company.

d) Net debt of the Company at the end of year stood at Rs. 1415 Crores as against Rs. 1532 crores previous year, reduction by Rs. 117 crores.

Consolidated Operations:

- The revenue from operations during the financial year 2017-18 increased to Rs. 2588.84 crores from Rs. 1994.08 crores recorded in previous year registering a growth of 30%. The Consolidated performance was improved followed by improvement of demand of iron ore pellets by Chinese Steel Industry and your Company’s subsidiary had exported majority of its production during the period under review.

- EBIDTA margin increased by 97.85% to Rs. 605.56 Crores as compared to EBITDA of Rs. 306.07 crores achieved in F.Y 2016-17. The consolidated margin also increased consequent upon improvement in margin in pellet business of the Company on account of buoyant demand.

- The Company registered profit before tax of Rs. 208.33 crores as against loss before tax of Rs. 72.90 crores during the previous year registering a growth of 186%.

- The net debt on consolidated basis stood at Rs. 2007 Crores at the end of the year as compared to Rs. 2175 crores at the end of previous year, a reduction of Rs. 168 crores.

The detailed performance and financial review has been given in the Annexure to the Directors Report titled “Management Discussion and Analysis”.

4. DEPOSITS

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

5. TRANSFER TO RESERVES

Your Company did not transfer any amount to the General Reserves Account during the Financial Year 2017-18.

6. DIVIDEND

In view of the restrictions imposed in the Master Restructuring Agreement entered into by the Company with its Lenders during the last financial year for restructuring of debt of the company, the Board of Directors of the Company have not recommended payment of any dividend for the year under review.

7. TRANSFER OF UNPAID & UNCLAIMED DIVIDEND & SHARES TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amount of dividend which remained unpaid or unclaimed for a period of seven years and shares whose dividend was unpaid/unclaimed for seven consecutive years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with Companies) Rules, 2012, the Company has uploaded the details of shares transferred to IEPF and unpaid and unclaimed amounts lying with the Company as on September 25, 2017 (date of last Annual General Meeting) on the Company’s website (www.godawaripowerispat.com), and also on the Ministry of Corporate Affairs’ website.

8. EXPANSION/NEW PROJECTS:

The management of the Company has decided to implement the expansion in rolling mill capacity during the current financial year and the same is expected to be fully implemented by March, 2019 and operations in Q1FY20.

9. CHANGES IN NATURE OF BUSINESS:

The Company has been engaged in the business of mining of captive iron ore and manufacturing the Iron Ore Pellets, Sponge Iron, Steel Billets, Wire Rods, HB Wires with generation of Power for captive consumption. There is no change in the nature of business of the Company during the year under review.

10. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION:

There are no materials changes and commitments affecting the financial position of the Company occurred between 01.04.2018 to the date of this report.

11. CHANGES IN STATUS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES:

None of the other companies has either become Subsidiary / Associate of the Company other than the existing Subsidiaries / Associates or has ceased to be Associate of the Company during the year.

The Company’s subsidiaries namely Godawari Clinkers and Cement Limited, Krishna Global Minerals Limited and Godawari Integrated Steels (India) Limited which were non-operational are under the process of voluntary strike off the names from the Registrar of Companies and necessary forms have been filed for the same.

Godawari Natural Resource Limited, a joint venture of Company has ceased to be a joint venture of the Company during the year since the Company has disposed of its holding in the Company. The said Company has also not started any business operations since its incorporation.

Lease of Railway siding of the Company’s joint venture Company Raipur Infrastructure Company Limited has expired and the same has not been renewed. However, your Company has build-up its own Railway Siding in the close proximity to the Company’s plant and the same has become operational as a result of which there has been no interruption in the movement of the materials of the Company.

Your Company has also not entered into any new Joint Venture nor terminated any existing Joint Venture during the year under review.

12. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY AND JOINT VENTURE COMPANIES:

Ardent Steel Limited (ASL)

During the year, ASL produced 590876 MTs of iron ore pellets & sold 584459 MTs of pellets in the market. The Company achieved net sales of Rs. 298.86 crores, EBIDTA of Rs. 76.82 Crores & PAT of Rs. 28.18 crores during year as compared to net sales of Rs. 147.05 crore, EBIDTA of Rs. 27.97 crore & net loss of Rs. 3.23 crore during the previous year. The net debt of the Company at the end of the year stood at Rs. 149.45 crore which is a reduction of Rs. 10.22 crore from last year net debt of Rs. 159.67 crore.

Godawari Green Energy Limited (GGEL)

During the year, GGEL generated 96.54 million units (CUF 22.04%) which is 6% lower as compared to generation in FY17. The generation was lower on account of grid failure in the month of May’17. Now, the plant is connected to 220 KVA grid along with 132 KVA grid earlier so that the interruption in generation due to grid failure can be avoided. The net revenue, EBIDTA & PAT of the Company stood at Rs. 105.36 crore, Rs. 89.86 crore & Rs. 0.62 crore respectively during the year as compared to Rs. 111.35 crore, Rs. 102.52 crore & Rs. 6.48 crore respectively during previous year. The net debt of the Company at the end of the year stood at Rs. 469.46 crore which is a reduction of Rs. 41.20 crore from last year net debt of Rs. 510.66 crore.

The performance and financial position of the Company’s subsidiaries namely, Ardent Steel Limited, Godawari Green Energy Limited, Associate Companies namely Jagdamba Power & Alloys Limited and Hira Ferro Alloys Limited and Joint Venture Companies namely Raipur Infrastructure Company Limited and Chhattisgarh Ispat Bhumi Limited for the Financial Year 2017-18 are given in ANNEXURE 01.

The other Subsidiary/Associate/Joint Venture Companies namely Godawari Energy Limited, and Chhattisgarh Captive Coal Mining Limited has not yet started operations and their projects have been abondmed.

13. MERGER OF JAGDAMBA POWER & ALLOYS LTD (JPAL):

The Board of Directors of the Company and that of JPAL has approved merger of JPAL with your Company with effect from 1st April, 2017. The merger process is currently on and is awaiting approval of stock exchanges. The scheme will be filed with NCLT after receipt of necessary approval of stock exchanges i.e NSE/BSE.

14. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) read with Rule 5 (1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is given in ANNEXURE 02. The Statement showing the names and other particulars of the employees of the Company as required under Rule 5 (2 &3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not required to be furnished since none of the employees of the Company has received remuneration in excess of the remuneration mentioned in the above mentioned Rule 5 (2) during the financial year 2017-18 except Shri B.L Agrawal (Managing Director) Shri Abhishek Agrawal (Executive Director), Managing Director whose details are given below:

Particulars

Details

Details

Name

Shri Bajrang Lal Agrawal

Shri Abhishek Agrawal

Designation

Managing Director

Whole Time Director

Remuneration Paid

Rs. 1.80 Crore per annum

Rs. 1. 44, Crore per annum

Nature of employment, Whether contractual or otherwise

Permanent

Permanent

Qualifications and Experience of the employee

B.E (Electronics) and has a experience of more than 30 years in cement, steel, power and mining sectors.

B.E. (Electronics) & MSc International Business from University of Leeds and has experience of more than 6 years.

Date of commencement of employment

17.08.2002

09.11.2011

The age of such employee

64

34

The last employment held by such employee before joining the Company

N.A.

N.A

The percentage of equity shares held by the employee in the Company within the meaning of clause (iii) of sub rule (2) above

Individually Holding:5.29% Spouse Holding: 4.05% Total holding along with spouse: 9.34%

Individually Holding:0.24%

Whether any such employee is a relative of any director or manager of the Company and if so, name of such director or manager

Shri Abhishek Agrawal and Shri Siddharth Agrawal

Shri Bajrang Lal Agrawal and Shri Siddharth Agrawal

15. CHANGES IN DIRECTORS & KEY MANAGERIAL PERSONS:

During the year under review, the shareholder of the Company in their AGM held on 25th Sept, 2017 has re-appointed Shri Dinesh Kumar Agrawal as Whole-time Director for a period of 5 years. The Board of Director in its board meeting held on 20th Jan, 2018 appointed Mr. Siddharth Agrawal as Non-Executive Additional Director.

The shareholders of the Company in their Extra-Ordinary General Meeting held on 27th Feb, 2018 has approved the appointment of Mr. Siddharth Agrawal as Non-Executive Director on the Board of the Company.

In accordance with the provisions of Section 152(6) (c) of the Companies Act, 2013 and the Company’s Articles of Association, Shri Dinesh Kumar Gandhi, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for reappointment.

16. CONSTITUTION OF CSR COMMITTEE, CSR POLICY AND INITIATIVES:

The CSR Committee consists of three directors including one Independent Director. The CSR Committee has formulated a CSR policy of the Company for undertaking the activities as specified in Schedule VII of the Companies Act, 2013. The Said policy has been approved and adopted by the Board of directors of the Company, the contents of which have been displayed on the Company’s website and also given in the Annual Report on CSR activities. (Web link: www.godawaripowerispat.com)

The Annual Report on CSR activities initiated and undertaken by the Company during the year under review is annexed herewith as an ANNEXURE-03.

17. AUDIT COMMITTEE COMPOSITION:

The Audit Committee consists of four directors including three Independent Directors and one Non-Executive Director all having financial literacy. More details are given in the Corporate Governance Report.

18. DIRECTORS’ RESPONSIBILITY STATEMENT

Your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013 based on the representations received from the operating management and Chief Financial Officer of the Company:

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

b) That your Directors have selected such accounting policies and applied them consistently, and made judgment 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;

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

d) That your Directors have prepared the annual accounts on a going concern basis;

e) That your Directors had laid down proper internal financial controls to be followed by the Company and that such financial controls are adequate and were operating effectively.

f) That your Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

19. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTOR:

All independent directors of the Company have given declarations as required under the provisions of section 149 (7) of the Companies Act, 2013 stating that they meet the eligibility criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and Clause 16(1) (b) of the Listing Agreement.

20. NUMBER OF MEETINGS OF BOARD:

During the year six Board Meetings and seven Audit Committee Meetings were convened and held, the details of which are given in the Corporate Governance Report.

21. AUDITORS:

Statutory Auditors

Pursuant to the provisions of section 139 of the Act and the rules framed thereafter, M/s JDS and Co., Chartered Accountants, were appointed as statutory auditors of the Company for a term of five consecutive financial years from the conclusion of Annual General Meeting held on 25.09.2017 till the conclusion of the Annual General Meeting of the Company to be held in the year 2022.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Record and Audit) Amendment Rules 2014 M/s Sanat Joshi & Associates has been appointed as cost auditors for conducting Cost Audit for the financial year under review.

Internal Auditors

M/s. OPS & Co, Chartered Accountants were appointed as Internal Auditors for the FY 2017-18.

Secretarial Audit

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. Jain Tuteja & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as “ANNEXURE 04”.

22. AUDITOR’S REPORTS

- Statutory Auditors

There are no qualifications, reservations, adverse remarks or disclaimers in the Statutory Auditor’s Report on the financial statements of the Company for the financial year 2017-18 and hence does not require any explanations or comments by the Board.

- Secretarial Audit

There are no qualifications, reservations, adverse remarks or disclaimers in the Secretarial Auditor’s Report on Secretarial and other applicable legal compliances to be made by the Company for the financial year 2017-18 and hence does not require any explanations or comments by the Board.

23. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into by the Company during the year under review were on arms length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with promoters, directors, key managerial personnel or related parties which may have a potential conflict with the interest of the Company at large.

24. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans given and investments made by the Company as covered under the provisions of Section 186 of the Companies Act, 2013 are given in Standalone Financial Statements (Ref. Notes 11, 5 & 29). Your Company has not extended corporate guarantee on behalf of any other Company.

25. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as “ANNEXURE 05”.

26. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

27. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal & financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operations were observed.

28. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as “ANNEXURE 06”.

29. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors have established ‘Whistle Blower Policy’ and ‘Code of Conduct’ for the directors & employees of the Company as required under the provisions of Sec. 177 of the Companies Act, 2013 read with Rule 7 of the Companies (Meeting of Board and its powers) Rules, 2014 and the then Clause-22 of the Listing Agreement.

The said policy has been properly communicated to all the directors and employees of the Company through the respective departmental heads and the new employees are being informed about the Vigil Policy by the Personnel Department at the time of their joining.

30. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an internal control system commensurate with the size and scale and complexity of its operations. The scope and authority of Internal Audit functions have been defined in the Internal Audit scope of work to maintain its objectivity and independence, the Internal Audit functions 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 system, accounting procedures and policies of the Company and its subsidiaries. Based on the report of the Internal Auditors, process owners undertake corrective actions in their respective areas and thereby strengthen the control. Significant Audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

31. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Company has adopted a Risk Management Policy to identify and evaluate business risks associated with the operations and other activities of the Company and formulated risk mitigations strategies.

32. NOMINATION AND REMUNERATION POLICY

Company’s Policy on Directors Appointment and Remuneration including criteria for determining qualification, positive attributes, independence of directors and other matters provided under section 178(3) of the Companies Act, 2013 is attached herewith as ANNEXURE 07. 33. ANNUAL EVALUATION OF BOARD ETC.

The Nomination and Remuneration Committee has formulated criteria for evaluation of the performance of the each of the directors of the Company. On the basis of said criteria, the Board and all its committees and directors have been evaluated by the Board of the Directors and Independent Directors of the Company.

34. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (Permanent, Contractual, Temporary, Training) are covered under this Policy. However, no complaints have been received during the year 2017-18.

35. CORPORATE GOVERNANCE

Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company’s Auditors confirming compliance forming an integral part of this Report is given as ANNEXURE 08.

36. ACKNOWLEGEMENTS

The Board expresses its sincere gratitude to the shareholders, bankers/lenders, Investors, vendors, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.

For and on behalf of Board of Directors

Place: Raipur

Date: 02nd May, 2018 CHAIRMAN


Mar 31, 2017

DIRECTORS REPORT_

To the Members,

The Directors have pleasure in presenting the 18th Annual Report on the business & operations of the Company together with the

Standalone and Consolidated Audited Statement of Financial Accounts for the year ended 31st March 2017.

1. HIGHLIGHTS OF PERFORMANCE

Standalone Operations:

- Standalone Net Sales for the year was Rs, 1546.02 Crores as compared to net sales of Rs, 1538.89 crores achieved during previous financial year.

- Standalone EBITDA for the year was Rs, 176.88 Crores as compared to '' EBITDA of Rs, 161.66 Crores achieved in previous financial year.

- Standalone net loss after tax was Rs, 77.44 Crores as compared to net loss of Rs, 48.23 Crores in previous year.

Consolidated Operations:

- Consolidated net sales for the year decreased by 8.86% to Rs, 1804.41 Crore as compared to Rs, 1979.73 Crore in F.Y 2015-16;

- Consolidated EBITDA for year increased by 29.67% to Rs, 306.05 Crores as compared to EBITDA of Rs, 236.03 crores achieved in previous financial year.

- Consolidated loss after tax during the year decreased to Rs, 73.62 Crore as compared to net loss after tax of Rs, 99.85 Crore in FY16.

2. FINANCIAL RESULTS

Rs, in Crores

Particulars

Standalone

Consolidated

2016-17

2015-16

2016-17

2015-16

Net Sales Turnover ........................................................................

1546.02

1538.89

1804.41

1979.73

Other Income...................................................................................

13.74

12.27

15.30

18.90

Total Revenue ................................................................................

1559.76

1551.16

1819.71

1998.63

Operating expenses......................................................................

1382.88

1389.50

1513.66

1762.60

Profit before Interest, Depreciation, Tax and Amortization (EBIDTA).........................................................................................

176.88

161.66

306.05

236.03

Finance Costs...................................................................................

176.70

163.18

259.14

252.00

Depreciation and amortization expenses..........................................

78.19

73.08

120.08

126.49

Add: Share of Profit/(Loss) of Associates & Joint Ventures

(after tax).........................................................................................

--

--

0.27

(04.51)

Profit/(Loss) Before Taxation........................................................

(78.01)

(74.60)

(72.90)

(146.97)

Taxation (including Deferred Tax)......................................................

(0.57)

(26.37)

0.72

(47.13)

Profit/(Loss) after Taxation (PAT).................................................

(77.44)

(48.23)

(73.62)

(99.84)

Other Comprehensive Income ..........................................................

(0.16)

(0.29)

(0.10)

0.31

Total Comprehensive Income for the period comprising profit/ (loss) & other comprehensive income for the period.................

(77.60)

(48.52)

(73.72)

(99.53)

3. INDIAN ACCOUNTING STANDARD

The Ministry of Corporate Affairs (MCA) on February 16, 2015, notified that Indian Accounting Standards (Ind AS) are applicable to certain classes of companies from April 1, 2016 with a transition date of April 1, 2015. Ind AS has replaced the previous Indian GAAP prescribed under Section 133 of the Companies Act, 2013 ("the Act") read with Rule 7 of the

Companies (Accounts) Rules, 2014. Ind AS is applicable to the Company from April 1, 2016. The reconciliations and descriptions of the effect of the transition from previous GAAP to Ind AS have been set out in Note 3.1 & 3.2 in the notes to accounts in the standalone financial statement and consolidated financial statement.

4. REVIEW OF PERFORMANCE

The financial year 2016-17 was yet another challenging year for the iron & steel Industry Indian & global economy. Although the India''s GDP growth was better as compared to other Asian economies, the domestic infrastructure, capital goods and manufacturing sectors continued to suffer resulting into lower demand for commodities like steel. The steel industry in general suffered during the year under review on account of lower demand, excess supply from domestic and global players. The supply of raw material also surpassed the demand in view of excess capacity in domestic & global markets leading to fall in cost of input like iron ore & coal. Due to improvement in global steel prices consequent upon improvement in Chinese markets on account of various measures taken by Chinese Government like phasing out of high polluting steel plants etc, the finished steel prices bottomed out and saw gradual improvement from Q2FY17 resulting into gradual improvement in steel industry''s financial performance in general and your Company''s performance in particular leading to flat financial performance for the whole year as compared to previous financial year. However, in the last quarter the realizations for the steel and iron ore pellets were better due to global demand. Your Company''s operating margins increased from 10.62% in FY16 to 15.23% FY17.

Stand-alone Operations:

The performance of your Company during the year under review remained sluggish under the prevailing circumstances and overall slowdown in demand growth. The highlights of the financial performance for the year are as under:

a) Net Sales Revenue increased by 0.46% to Rs, 1546.02 crores from Rs, 1538.89 crores recorded in previous year. The top line has contracted mainly on account of fall in prices of finished goods despite highest ever production achieved by the Company in couple of divisions.

b) Operating Profit increased to 11.34% from 10.42% achieved in previous year.

c) The Company registered Net Loss of Rs, 77.44 crores as against net Loss after tax of Rs, 48.23 crores during the previous year. The higher net loss compared to previous year was mainly on account of deferred tax adjustment.

Consolidated Operations:

a) Net sales revenue during the FY 2016-17 decreased by 8.86% to Rs, 1804.41 crores from Rs, 1979.73 crores recorded in previous year.

b) EBITDA Margins increased by 29.67% to Rs, 306.05 crores from Rs, 236.03 crores during previous year

c) The Company registered Loss before tax of Rs, 78.01 crores as against Loss before tax of Rs, 74.60 crores during the previous year.

The detailed performance and financial review has been given in the Annexure to the Directors Report titled "Management Discussion and Analysis".

5. DEBT RESTRUCTURING & SHARE CAPITAL

On account of cash-flow-mismatch, due to fall in operating margins during past two years, the Company defaulted in repayment of debt to the bank during the period under review. Based on Company''s request, the Lenders of the company have, in the joint lenders forum ("JLF") held on January 18, 2017 in terms of the RBI Circular agreed for implementing a Corrective Action Plan (CAP) and accordingly, decided to restructure the existing debt facilities,

As per the terms and conditions of the above restructuring package, Promoters of the Company were to bring Rs, 31 crores by way of equity in the Company.

Accordingly, Promoters and persons acting in concert with the Promoters have subscribed to 24,80,000 equity shares of Rs, 10/- at a premium of Rs, 115/- per share pursuant to the approval of Shareholders of the company in the Extra Ordinary General Meeting held on 6th March, 2017 for issue and allotment of 24,80,000 equity shares of Rs, 10/each at a premium of Rs, 115/- per share on preferential basis to the Promoters and promoters group of the company. The price was determined pursuant to the provisions of Chapter VII of SEBI (ICDR) Regulations 2009.

The allotment of the aforesaid shares has been done on 21.03.2017 as a result of which the paid up Equity Share Capital has been enhanced from Rs, 32.756 crores to Rs, 35.236 crores and said shares have been listed with both BSE and NSE. None of the Directors of the Company hold convertible instruments of the Company

6. DEPOSITS

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

7. TRANSFER TO RESERVES

Your Company did not transfer any amount to the General Reserves Account during the Financial Year 2016-17 since company has incurred losses.

8. DIVIDEND

In view of the significant drop in operating performance & in order to conserve the resources, the Board of Directors of the Company have not recommended payment of any dividend for the year under review.

9. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with Companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on September 20, 2016 (date of last Annual General Meeting) on the Company''s website (www. godawaripowerispat.com), as also on the Ministry of Corporate Affairs'' website.

10. EXPANSION/NEW PROJECTS:

The capital expenditure planned under earlier capex plan for modernization of SMS division etc. have since been completed and Company has deferred the capex plan for setting up rolling mill.

11. CHANGES IN NATURE OF BUSINESS:

The Company has been engaged in the business of manufacturing the trading of Iron Ore Pellets, Sponge Iron, Steel Billets, HB Wires and generation of Power. There is no change in the nature of Business of the Company during the Financial Year 2016-17.

12. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION:

There are no materials changes and commitments affecting the financial position of the company occurred between the 01.04.2017 to the date of this report. Your Company has pledged 41,13,150 equity shares of '' 10/- held in Ardent Steel Ltd (representing 38.93% of paid up share capital of the Company) and 1,18,00,000 equity shares of '' 10/- each held in Godawari Energy Ltd with lenders of the Company and its subsidiary pursuant to stipulations in the Restructuring Package of your Company and your Company''s subsidiary Company namely Ardent Steel Ltd.

13. CHANGES IN STATUS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES:

Pursuant to debt restructuring package of Ardent Steel Ltd, Company''s subsidiary, approved by the JLF and as per the stipulation made in the said restructuring package, your company has subscribed 5,65,000 equity shares of Rs, 10/- each being 5.35% of total paid-up capital of Ardent Steel Limited (ASL) at a premium of Rs, 50/- per share on 27.03.2016. Consequently, the Company''s shareholding in ASL has increased from 75% to 76.34% and ASL continues to be a subsidiary of Company.

During the year under review, your Company has exercised the right of conversion on 31,00,000 Optionally Convertible Cumulative Preference Shares (OCCPSs) of Rs, 100 each into equal number of equity shares of Rs, 10/- each at a premium of Rs, 90/- per share as per the terms and conditions of issue and allotment of respective OCCPS held in Godawari Green Energy Limited (GGEL), a subsidiary of the Company. At the same time M/s. Shiv-Vani Energy Limited, an investor in GGEL has also converted its holdings of 56,00,000 OCCPSs of Rs, 100 each in to equal number of Equity shares of Rs, 10/- each at a premium of Rs, 90/- per share.

Consequent upon allotment of equity shares by Godawari Green Energy Limited upon conversion of OCCPSs, the shareholding of your Company has gone down from 100% to 76.12% in GGEL. However GGEL continues to be subsidiary of our Company.

None of the other companies has either become Subsidiary / Associate of the Company other than the existing Subsidiaries / Associates or has ceased to be Subsidiary / Associate of the Company during the Financial Year 2016-17.

Your Company has also not entered into any new Joint Venture nor terminated any existing Joint Venture during the Financial Year 2016-17.

14. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY AND JOINT VENTURE COMPANIES:

The performance and financial position of the company''s subsidiaries namely, Ardent Steels Limited, Godawari Green Energy Limited, Associate Companies namely Jagdamba Power & Alloys Limited and Hira Ferro Alloys Limited and Joint Venture Companies namely Raipur Infrastructure Company Limited for the Financial Year 2016-17 are given in ANNEXURE 01.

The other Subsidiary/Associate/Joint Venture Companies namely Godawari Energy Limited, Godawari Clinkers and Cement Limited, Krishna Global Minerals Limited and Godawari Integrated Steels (India) Limited and Chhattisgarh Captive Coal Mining Limited have not yet started their operations.

15. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) read with Rule 5 (1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company is given in ANNEXURE 02. The Statement showing the names and other particulars of the employees of the company as required under Rule 5 (2 &3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not required to be furnished since none of the employees of the company has received remuneration in excess of the remuneration mentioned in the above mentioned Rule 5 (2) during the financial year 2016-17.

16. CHANGES IN DIRECTORS & KEY MANAGERIAL PERSONS:

During the year under review, the Board of Directors in its meeting held on 28.05.2016 has re-appointed Shri Abhishek Agrawal and Shri Vinod Pillai as Whole-time Directors for a period of 5 years w.e.f. November 09, 2016 and June 01, 2016 respectively.

None of the other Directors or Key Managerial Persons has been appointed or resigned during the Financial Year 2016-17.

In accordance with the provisions of Section 152(6) (c) of the Companies Act, 2013 and the Company''s Articles of Association, Shri Vinod Pillai, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for reappointment.

17. CONSTITUTION OF CSR COMMITTEE, CSR POLICY AND INITIATIVES:

The CSR Committee consists of three directors including one Independent Director. The CSR Committee has formulated a CSR policy of the Company for undertaking the activities as specified in Schedule VII to the Companies Act, 2013. The Said policy has been approved and adopted by the Board of directors of the Company, the contents of which have been displayed on the company''s website and also given in the Annual Report on CSR activities. (Web link: www.godawaripowerispat.com)

The Annual Report on CSR activities initiated and under taken by the Company during the Financial Year 2016-17 is annexed herewith as an ANNEXURE-03.

18. AUDIT COMMITTEE COMPOSITION:

The Audit Committee consists of four directors including three Independent Directors and one Non-Executive Director all having financial literacy.

19. DIRECTORS'' RESPONSIBILITY STATEMENT

Your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013 based on the representations received from the operating management and Chief Financial Officer of the company:

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

b) That your Directors have selected such accounting policies and applied them consistently, and made judgment 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;

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

d) That your Directors have prepared the annual accounts on a going concern basis;

e) That your Directors had laid down proper internal financial controls to be followed by the company and that such financial controls are adequate and were operating effectively;

f) That your Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively

20. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTOR:

All independent directors of the Company have given declarations as required under the provisions of section 149 (7) of the Companies Act, 2013 stating that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and Clause 16(1) (b) of the Listing Agreement.

21. NUMBER OF MEETINGS OF BOARD:

During the year five Board Meetings and four Audit Committee Meetings were convened and held, the details of which are given in the Corporate Governance Report.

22. AUDITORS:

Statutory Auditors

M/s O.P. Singhania and Co., Chartered Accountants, Auditors of the Company, hold office until the conclusion of the forthcoming Annual General Meeting and pursuant to section 139 of the Companies Act, 2013, and Rule 6 of the Companies (Audit and Auditors) Rules,2014 they being ineligible for re-appointment have not offered themselves for reappointment. The Audit Committee considering the qualifications and experience of M/s. JDS & CO., Chartered Accountants (Firm Regn. No.018400C) has recommended their appointment as Statutory Auditors of the company for the period from the conclusion of ensuing Annual General Meeting to be held in the year 2017 to the conclusion of Annual General Meeting to be held in the year 2022. The Company has received a certificate from

M/s. JDS & CO. to the effect of their appointment, if made, would be within the limits prescribed under Section 141 (3) (g) of the Companies Act, 2013 and that they are not disqualified for re-appointment and also satisfies the criteria as mentioned under Section 141 and they have obtained peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Record and Audit) Amendment Rules 2014 M/s Sanat Joshi & Associates has been appointed as cost auditors for conducting Cost Audit for the financial year 2016-17.

Internal Auditors

M/s. JDS & Co, Chartered Accountants were appointed as Internal Auditors for the FY 2016-17.

Secretarial Audit

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. Jain Tuteja & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as "ANNEXURE 04".

23. AUDITOR''S REPORTS

- Statutory Auditors

There are no qualifications, reservations, adverse remarks or disclaimers in the statutory Auditor''s Report on the Financial Statements of the company for the financial year 2016-17 and hence does not require any explanations or comments.

- Secretarial Audit

There are no qualifications, reservations, adverse remarks or disclaimers in the Secretarial Auditor''s Report on Secretarial and other applicable legal compliances to be made by the company for the financial year 2016-17 and hence does not require any explanations or comments.

24. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into by the Company during the financial year 2016-17 were on arms length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the company with promoters, directors, key managerial personnel or related parties which may have a potential conflict with the interest of the company at large.

25. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of Loans given, Investments made and corporate guarantees extended by the company as covered under the provisions of Section 186 of the Companies Act, 2013 are given in Standalone Financial Statements (Ref. Notes 6, 13 & 33).

26. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as "ANNEXURE 05"

27. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the company and its future operations.

28. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.

29. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as "ANNEXURE 06".

30. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors have established ''Whistle Blower Policy'' and ''Code of Conduct'' for the directors & employees of the Company as required under the provisions of Sec.

177 of the Companies Act, 2013 read with Rule 7 of the Companies (Meeting of Board and its powers) Rules, 2014 and the then Clause-22 of the Listing Agreement.

The said Policy has been properly communicated to all the directors and employees of the Company through the respective departmental heads and the new employees shall be informed about the Vigil Policy by the Personnel Department at the time of their joining.

31. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an internal control system commensurate with the size and scale and complexity of its operations.

The scope and authority of Internal Audit functions have been defined in the Internal Audit Charter to maintain its objectivity and independence, the Internal Audit functions 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 system, accounting procedures and policies of the company and its subsidiaries. Based on the report of the Internal Auditors, process owners undertake corrective actions in their respective areas and thereby strengthen the control. Significant Audit observations and corrective actions, thereon are presented to the Audit Committee of the Board.

32. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Company has adopted a Risk Management Policy to identify and evaluate business risks associated with the operations and other activities of the Company and formulated risk mitigations strategies.

33. NOMINATION AND REMUNERATION POLICY

Company''s Policy on Directors appointment and Remuneration including criteria for determining qualification, positive attributes, independence of directors and other matters provided under section 178(3) of the Companies Act, 2013 is attached herewith as ANNEXURE 07

34. ANNUAL EVALUATION OF BOARD, ETC.

The Nomination and Remuneration Committee has formulated criteria for evaluation of the performance of the each of the directors of the company. On the basis of said criteria, the Board and all its committees and directors have been evaluated by the Board of the directors and Independent Directors of the Company.

35. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (Permanent, Contractual, Temporary, Training) are covered under this Policy. However no complaints has been received during the year 2016-17.

36. CORPORATE GOVERNANCE

Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations

2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance forming an integral part of this Report is given as ANNEXURE 08.

37. ACKNOWLEDGEMENTS

The Board expresses its sincere gratitude to the shareholders, bankers, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.

For and on behalf of Board of Directors

Place: Raipur

Date: 30.05.2017 CHAIRMAN


Mar 31, 2015

To the Members,

The Directors have pleasure in presenting the 16th Annual Report on the business & operations of the Company together with the Standalone and Consolidated Audited Statement of Financial Accounts for the year ended 31st March 2015.

1. HIGHLIGHTS OF PERFORMANCE

- Consolidated income for the year increased by 15.07% to Rs. 2455.20 Crore as compared to Rs. 2133.60 Crore in F.Y 2013-14;

- Consolidated net sales for the year was Rs. 2394.98 Crore as compared to Rs. 2118.05 Crore in F.Y 2013-14, a growth of 13.07%;

- Consolidated profit after tax for the year was Rs. 70.73 Crore as compared to Rs. 69.97 Crore in F.Y.2013-14:

2. FINANCIAL RESULTS

Rs. in Crores

Particulars Standalone Consolidated 2014-15 2013-14 2014-15 2013-14

Gross Sales 2166.61 1732.47 2665.38 2349.87

Less: Excise duty/Sales tax/VAT 231.56 191.55 270.40 231.82

Net Sales Turnover 1935.05 1540.92 2394.98 2118.05

Operating expenses 1671.72 1329.01 2036.77 1770.81

Operating Profit. 263.33 211.91 358.21 347.24

Other Income 16.49 24.49 60.22 15.55

Total Revenue 1951.54 1565.41 2455.20 2133.60

Profit before Interest, Depreciation, Tax and Amortization 279.82 236.40 418.43 362.79

(EBIDTA)

Finance Costs 144.88 114.51 223.65 165.01

Depreciation and amortization expenses 65.82 66.68 118.18 105.49

Profit Before Taxation (PBT) 69.12 55.21 76.60 92.29

Taxation (including Deferred Tax) 7.01 (0.73) 5.87 22.32

Profit after Taxation (PAT) 62.11 55.94 70.73 69.97

Less: Minority Interest -- -- 4.47 10.94

Less: Share of Loss of associate company -- -- 0.05 1.19

Profit brought forward from previous year 358.53 316.78 377.54 357.30

Amount available for Appropriations 420.64 372.72 443.75 415.14

Appropriations

Proposed Final Dividend on Equity Shares 3.28 3.28 4.58 7.28

Interim Equity Dividend -- 4.91 -- 4.91

Corporate Dividend Tax 0.54 -- 0.78 2.91

Transfer to General Reserves -- 6.00 1.50 22.50

Adjustments for Fixed Assets where useful life as per Schedule-II 2.35 -- -- -- (Net of taxes)

Depreciation of those assets whose useful life is Nil (Net of taxes) -- -- 3.63 --

Total 6.17 14.19 10.49 37.60

Net Surplus 414.47 358.53 433.25 377.54

The financial year 2014-15 was a yet another challenging year due to continued slowdown in Indian Economy and more particularly in Industrial production and infrastructure growth due to lack of demand, stalled projects and broken corporate Balance Sheet. The Iron & Steel Industry went through a difficult period in view of supply constraints of raw material i.e. domestic Iron ore & coal on account of ban of iron ore mining in Orissa and supply of coal to non- regulated sectors by Coal India Ltd which kept the input cost at elevated level on one side and falling finished steel prices on account of cheap imports from China & CIS countries. In the above backdrop, the margin of the industry players contracted. The results of the operating performance of your Company in such challenging & adverse conditions are mentioned below:

Stand-alone Operations:

The performance of your Company during the year under review remained satisfactory under the prevailing circumstances and overall slowdown in demand growth. The highlights of the financial performance for the year are as under:

a) Net Sales Revenue increased by 25.58% to Rs. 1935.05 crores from Rs. 1540.92 crores recorded in previous year.

b) Operating Profit marginally decreased to 14.46% from 15.34 % achieved in previous year.

c) PBT increased by 25.19% to Rs. 69.12 crores from Rs. 55.21 crores and net profit after tax remained flat at Rs. 62.11 crores (Previous Year Rs. 55.94 Crores).

Consolidated Operations:

a) Net sales revenue during the FY 2014-15 increased by 13.07% to Rs. 2394.98 crores from Rs. 2118.05 crores recorded in previous year.

b) EBIDTA Margins increased by 4.26 % to Rs. 378.24 crores (Excluding net gain of Rs. 40.19 crores on sale of Current Investments by Subsidiary Company Hira Ferro Alloys Limited) from Rs. 362.79 crores during previous year, recording operating margin of 15.79 %.

c) PBT decreased to Rs. 76.60 crores from Rs. 92.29 crores. The consolidated PBT fell on account of higher interest & depreciation cost of new pellet plant and Solar Power plant during the year under review.

The detailed performance and financial review has been given in the Annexure to the Directors Report titled "Management Discussion and Analysis".

The paid up Equity Share Capital as on March 31, 2015 was Rs. 32.756 Crore. During the year under review, the Company has not issued any shares with differential voting rights nor granted stock options nor sweat equity. As on March 31, 2015, none of the Directors of the Company hold convertible instruments of the Company.

5. DEPOSITS

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

6. TRANSFER TO RESERVES

Your Company has not transferred any amount to the General Reserves Account during the Financial Year 2014-15, since the company is proposing a dividend of only 10% on the equity share capital of the company.

The Company had created 25% Debenture Redemption Reserve of Rs. 38.75 crores towards the redemption of outstanding Debentures of Rs. 155 crores as on 31.03.2014. However since the Debentures have been redeemed to the tune of Rs. 60.00 crores during the financial year 2014-15, an amount of Rs. 15.00 crores had been withdrawn from Debenture Redemption Reserve Account and transferred to General Reserve Account leaving a balance of Rs. 23.75 crores which is equivalent to 25% of the outstanding Debentures of Rs. 95 crores as on 31.03.2015 as prescribed under Section 71 of the Companies Act, 2013 read with Rule 7 of the Companies (Share Capital and Debenture) Rules 2014.

7. DIVIDEND

Your Directors have pleasure in recommending payment of final dividend @ 10% i.e. Re.1.00 per equity share for the year under review. The total outflow of funds on account of payment of dividend will be Rs. 3.82 crore as compared to Rs. 8.19 crore (25%) during the previous year including dividend tax. Upon approval, the dividend shall be paid to all those shareholders whose names appear in the register of members as on the record date i.e. 31st August, 2015 fixed for payment of dividend.

8. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from to time to time on due dates, to the Investor Education and Protection Fund.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with Companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on September 27, 2014 (date of last Annual General Meeting) on the Company's website (www. godawaripowerispat.com), as also on the Ministry of Corporate Affairs' website.

9. EXPANSION/NEW PROJECTS:

Expansion cum balancing Plan in Steel Melting (SMS) and Rolling Capacity:

The Company has during year under review slowed down the work on expansion cum balancing plan in steel melting shop and rolling mill in view of lower demand for steel products. However your Company is taking up appropriate steps to complete the project over next 12 months, by the demand conditions are expected to be improved.

Mining Projects:

Ari Dongri Iron Ore mines:

Your Company is in process of enhancing the capacity of Ari Dongri Iron Ore mines from 7,00,000 TPA to 14,00,000 TPA, for which Stage I &II forest approval from MoEF has been obtained and mining lease has been executed. The production in enhanced capacity is expected to be started in the current year.

Boria Tibu Iron Ore mines:

The Company has started mine development cum mining activities at Boria Tibu Iron Ore mines with capacity of 700000 TPA in Chhattisgarh and the developmental activities are going on smoothly. The Company has also stared production from this mine and gradually building up the production volumes.

The output from mines will be sufficient to meet the captive iron ore requirement of the Company's production capacities in Chhattisgarh.

Coal Mines:

The Company was allotted three Coal Blocks i.e. Nakia, Madanpur (North) & Madanpur (South) in the State of Chhattisgarh in consortium with other companies through JV Company, namely Chhattisgarh Captive Coal Mining Ltd. However, the said Coal Blocks could not start operations in view of pendency of certain administrative approvals and these Coal Blocks were de- allocated by the Ministry of Coal, which was, however, stayed by the Hon'ble High Court of Delhi and the matter has been sub-judice. The allocation of said Coal

Blocks stands cancelled by virtue of the Order dated September 24, 2014 passed by the Hon'ble Supreme Court. The Company has invested Rs. 6.31 crores in the equity capital of JV Company which has been utilised by JV Company for development of said coal blocks. No provision for impairment in value of Investments in JV Company has been made in view of likely realization of amount invested upon reimbursement of cost incurred by the Company from the future allocates of the said coal blocks. The JV Company is also in process of realization of current assets held by it and the amount is expected to be refunded to the shareholders in due course. Accordingly the provision for impairment in value of investment, if any, shall be made as and when the amount of actual loss is determined.

10. ALTERATION OF ARTICLES OF ASSOCIATION

Your Company has adopted new set of articles of association in line with the provisions of the Companies Act, 2013. The Shareholders of the Company in their Annual General Meeting held on 27th September, 2014 have accorded their approval for adoption a new set of Articles of Association of the Company by special resolution.

11. CHANGES IN NATURE OF BUSINESS:

The Company has been engaged in the business of manufacturing the trading of Iron Ore Pellets, Sponge Iron, Steel Billets, HB Wires and generation of Power. There is no change in the nature of Business of the Company during the Financial Year 2014-15.

12. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION:

There are no material changes and commitments affecting the financial position of the company occurred between the 01.04.2015 to the date of this report, except continued slowed down in steel demand and falling prices of finished products on account of pressure from cheaper imports.

13. CHANGES IN STATUS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES:

None of the companies has either become Subsidiary of the Company other than the existing Subsidiaries or has ceased to be Subsidiary of the Company during the Financial Year 2014-15.

Your company has acquired 22,40,000 equity shares of Rs. 10 each of Chhattisgarh Ispat Bhumi Limited during the financial year and the total investments along with existing 5,70,000 equity shares of Rs. 10 each aggregated to 28,10,000 equity shares representing 35.36% of total equity of Chhattisgarh Ispat Bhumi Limited. Your

company also acquired 16,940 equity shares of Rs.10 each of Godawari Natural Resources Limited aggregating 33.88% and 2605000 equity shares of Rs. 10 each of Jagdamba Power and Alloys Limited aggregating 26.06%. Thus Chhattisgarh Ispat Bhumi Limited and Jagdamba Power and Alloys Limited have become Associate Companies and Godawari Natural Resources Limited has become Joint Venture Company during the year.

Your Company has also not entered into any new Joint Venture nor terminated any existing Joint Venture during the Financial Year 2014-15. There is no Associate company to our company.

14. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY AND JOINT VENTURE COMPANIES:

The performance and financial position of the company's subsidiaries namely, Ardent Steels Limited, Godawari Green Energy Limited, Hira Ferro Alloys Limited, Associate Companies namely Jagadamba Power & Alloys Limited, Chhattisgarh Ispat Bhumi Limited and Joint Venture Companies namely Raipur Infrastructure Company Limited for the Financial Year 2014-15 are given in ANNEXURE-01. The other subsidiaries namely Godawari Clinkers and Cement Limited, Godawari Energy Limited, Godawari Integrated Steels India Limited and Krishna Global Minerals Limited and the other Joint Venture and Associate Companies namely Godawari Natural Resources Limited and Chhattisgarh Captive Coal Mining Limited have not yet started their operations.

The Financial Statements of the Subsidiary Companies and Joint Venture for the Financial Year 2014-15 have been consolidated.

15. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) read with Rule 5 (1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company is given in ANNEXURE-02. The Statement showing the names and other particulars of the employees of the company as required under Rule 5 (2 &3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not required to be furnished since none of the employees of the company has received remuneration in excess of the remuneration mentioned in the above mentioned Rule 5 (2) during the financial year 2014-15.

16. CHANGES IN DIRECTORS & KEY MANAGERIAL PERSONS:

None of the Directors or Key Managerial Persons has been appointed or resigned during the Financial Year 2014-15 except appointment of CA Sanjay Bothra as Chief Financial Officer of the Company with effect from 24.05.2014.

17. CONSTITUTION OF CSR COMMITTEE, CSR POLICY AND INITIATIVES:

The Board of Directors have constitutes a CSR Committee comprising of three directors including one Independent Director on 15.03.2014. The CSR Committee has formulated a CSR policy of the Company for undertaking the activities as specified in Schedule VII to the Companies Act, 2013. The Said policy has been approved and adopted by the Board of directors of the Company, the contents of which have been displayed on the company's website and also given in the Annual Report on CSR activities. (Web link: www.godawaripowerispat.com ) The Annual Report on CSR activities initiated and under taken by the Company during the Financial Year 2014-15 is annexed herewith as an ANNEXURE-03.

18. AUDIT COMMITTEE COMPOSITION:

The Board of Directors have constituted an Audit Committee comprising of four directors including three Independent Directors and one Non-Executive Director all having financial literacy.

19. DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013 based on the representations received from the operating management and Chief Financial Officer of the company:

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

b) That your Directors have selected such accounting policies and applied them consistently, and made judgment 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;

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

d) That your Directors have prepared the annual accounts on a going concern basis;

e) That your Directors had laid down proper internal financial controls to be followed by the company and that such financial controls are adequate and were operating effectively.

f) That your Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively

20. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTOR:

All independent directors of the Company have given declarations as required under the provisions of section 149 (7) of the Companies Act, 2013 stating that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and Clause 49(II) (B) of the Listing Agreement.

21. NUMBER OF MEETINGS OF BOARD:

During the year six Board Meetings and four Audit Committee Meetings were convened and held, the details of which are given in the Corporate Governance Report.

22. AUDITORS:

Statutory Auditors

M/s O.P. Singhania and Co., Chartered Accountants, Auditors of the Company, hold office until the conclusion of the forthcoming Annual General Meeting and being eligible have offered themselves for re-appointment. The Company has received a certificate from them to the effect that their re-appointment, if made, would be within the limits prescribed under Section 141 (3) (g) of the Companies Act, 2013 and that they are not disqualified for re-appointment and also satisfies the criteria as mentioned under Section 141 and they have obtained peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Record and Audit) Amendment Rules 2014 M/s Sanat Joshi & Associates has been appointed as cost auditors for conducting Cost Audit for the financial year 2014-15.

Internal Auditors

M/s. JDS & Co, Chartered Accountants were appointed as Internal Auditors for the FY 2014-15.

Secretarial Audit

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. Jain Tuteja & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as "ANNEXURE 04".

23. AUDITOR'S REPORTS

- Statutory Auditors

There are no qualifications, reservations, adverse remarks or disclaimers in the statutory Auditor's Report on the Financial Statements of the company for the financial year 2014-15 and hence does not require any explanations or comments.

- Secretarial Audit

There are no qualifications, reservations, adverse remarks or disclaimers in the Secretarial Auditor's Report on Secretarial and other applicable legal compliances to be made by the company for the financial year 2014-15 and hence does not require any explanations or comments.

24. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into by the Company during the financial year 2014-15 were on arms length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the company with promoters, directors, key managerial personnel or related parties which may have a potential conflict with the interest of the company at large.

25. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of Loans given and Investments made by the company as covered under the provisions of Section 186 of the Companies Act, 2013 are given in Standalone Financial Statements (Ref. Note 13 & 14). The company has not given any corporate guarantees to any other party.

26. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as "ANNEXURE 05".

27. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the company and its future operations.

28. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.

29. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as "ANNEXURE 06".

30. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors in its meeting held on 11.11.2014 approved and established 'Whistle Blower Policy' and 'Code of Conduct' for the directors & employees of the Company as required under the provisions of Sec. 177 of the Companies Act, 2013 read with Rule 7 of the Companies (Meeting of Board and its powers) Rules, 2014 and Clause-49 of the Listing Agreement.

The said Policy has been properly communicated to all the directors and employees of the Company through the respective departmental heads and the new employees shall be informed about the Vigil Policy by the Personnel Department at the time of their joining.

31. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an internal control system commensurate with the size and scale and complexity of its operations. The scope and authority of Internal Audit functions have been defined in the Internal Audit Charter to maintain its objectivity and independence, the Internal Audit functions 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 system, accounting procedures and policies of the company and its subsidiaries. Based on the report of the Internal Auditors, process owners undertake corrective actions in their respective areas and thereby strengthen the control. Significant Audit observations and corrective actions, thereon are presented to the Audit Committee of the Board.

32. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Company has adopted a Risk Management Policy to identify and evaluate business risks associated with the operations and other activities of the Company and formulated risk mitigations strategies.

33. NOMINATION AND REMUNERATION POLICY.

Company's Policy on Directors appointment and Remuneration including criteria for determining qualification, positive attributes, independence of directors and other matters provided under section 178(3) of the Companies Act, 2013 is attached herewith as ANNEXURE 07.

34. ANNUAL EVALUATION OF BOARD, ETC.

The Nomination and Remuneration Committee has formulated criteria for evaluation of the performance of the each of the directors of the company. On the basis of said criteria, the Board and all its committees and directors have been evaluated by the Board of the directors.

35. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (Permanent, Contractual, Temporary, Training) are covered under this Policy. However no complaints has been received during the year 2014-15.

36. CORPORATE GOVERNANCE

As per Clause 49 of the Listing Agreement with the Stock Exchanges, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company's Auditors confirming compliance forming an integral part of this Report is given as ANNEXURE 08.

37. ACKNOWLEDGEMENTS

The Board expresses its sincere gratitude to the shareholders, bankers, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.

For and on behalf of Board of Directors

Place: Raipur

Date : 11.08.2015 CHAIRMAN


Mar 31, 2014

To the Members,

The Directors have pleasure in presenting the 15th Annual Report on the business & operations of the Company together with the Stand-alone and Consolidated Audited Financial Statements for the year ended 31st March 2014.

FINANCIAL RESULTS

RS in Crores

Particulars Standalone 2013-2014 2012-2013

Gross Sales 1725.47 2141.79

Less: Excise duty 184.55 30.16

Net Sales Turnover 1540.92 1911.63

Operating expenses 1329.01 1670.70

Operating Profit 211.91 240.93

Other Income 24.49 9.70

Total Revenue 1565.41 1921.33

Profit before Interest, Depreciation, Tax and Amortization 236.40 250.63

(EBIDTA)

Finance Costs 114.51 92.39

Depreciation and amortization expenses 66.68 52.27

Profit Before Taxation (PBT) 55.21 105.97

Taxation (including Deferred Tax) (0.73 ) 18.17 )

Profit after Taxation (PAT) 55.94 124.14

Less: Minority Interest - -

Less: Share of Loss of associate company - -

Profit brought forward from previous year 316.78 300.71

Less: Adjustment of deferred tax as per transitional provision - 52.93

Amount available for Appropriations 372.72 371.92

Appropriations

Proposed Final Dividend on Equity Shares 3.28 8.19

Interim Equity Dividend 4.91 -

Corporate Dividend Tax - 1.29

Transfer to General Reserves 6.00 15.00

Transfer to Debenture Redemption Reserve - 30.66

Total 14.19 55.14

Net Surplus 358.53 316.78

paticular consolidated

2013-14 2012-13 Gross sales 2349.87 2663.45

less: excise duty 231.82 306.74

NetSalesTurnover 2118.05 2356.71

Operating expenses 1770.81 2025.79

Operating Profit 347.24 330.93

OtherIncome 15.55 14.78

Total Revenue 2133.60 2371.49

Profit before Interest, Depreciation, Tax and Amortization (EBIDTA) 362.79 345.71

Finance Costs 165.01 121.06

Depreciation and amortization expenses 105.49 70.92

Profit Before Taxation (PBT) 92.29 153.73

Taxation (including Deferred Tax) 22.32 4.56

Profit after Taxation (PAT) 69.97 158.29

Less: Mi nority Interest 10.94 9.48

Less: Share of Loss of associate company 1.19 -

Profit brought forward from previous year 357.30 318.16

Less: Adjustment of deferred tax as per transitional provision - 52.93

Amount available for Appropriations 415.14 414.04

Appropriations

Proposed Final Dividend on Equity Shares 7.28 8.19

Interim Equity Dividend 4.91 -

Corporate Dividend Tax 2.91 1.39

Transfer to General Reserves 22.50 16.50

Transfer to Debenture Redemption Reserve - 30.66

Total 37.60 56.74

Net Surplus 377.54 357.30

REVIEW OF PERFORMANCE

The financial year 2013-14 was a yet another challenging year due to continued slowdown in Indian Economy and fall in Industrial production and infrastructure growth on account of high inflation, higher fiscal deficit, current account deficit and policy paralysis. Off late, Government of India recognized the problems and has taken certain initiatives to improve the situation and results of the same have started reflecting in headline indicators. The impacts of the same on corporate performance are expected to be felt from the current financia year onwards. In the backdrop of the slowdown in Industria and infrastructure growth, on account of general slowdown in

ndian economy, the demand growth of Steel was just 0.60% Due to fall in demand growth and increase in production capacity of large steel players, the prices of finished steel and ntermediate products dropped substantially impacting the performance of small & medium enterprises in the sector. The prices of finished steel fell by about 12-15% across product categories including intermediate products without meaningfu reduction in input cost.

Stand-alone Operations:

The performance of your Company during the year under review remained satisfactory under the prevailing circumstances

and overall slowdown in demand growth coupled with increase production volumes. The highlights of the financial performance for the year are as under:

a) Net Sales Revenue decreased by 19.39% to Rs 1540.92 crores from Rs 1911.63 crores recorded in previous year. The fall in net sales was on account of fall in selling prices to the extent of about 15% as compared to last year due to decrease in demand and increase in production volumes of large Integrated Steel Producers which put the downward pressure on finished steel prices

b) Operating Profit margin improved to 13.04 % from 12.60% achieved in previous year despite fall in selling prices of finished products. The improvement in margins was on account of higher contribution from increased production volumes of Pellets and sponge iron

c) PBT decreased toRs 55.21 crores fromRs 105.97 crores. The fall in PBTwason account of higher interests depreciation cost on account of capitalization of new pellet plant.

Consolidated Operations:

a) Net sales revenue during the FY 2013-14 decreased to Rs 2118.05 crores from Rs 2356.71 crores recorded in previous year. The reduction in net sales was on account of fall in sales realization despite overall increase in production volumes of Iron Ore Pellets.

b) EBIDTA Margins increased by 4.94% to Rs 362.79 crores from Rs 345.71 crores during previous year, recording healthy operating margin of 17.13% on account of higher operating profit recorded by M/s Ardent Steel Limited and contribution from solar power subsidiary

c) PBT decreased to Rs 92.29 crores from Rs 153.73 crores. The consolidated PBT also fell on account of higher interest & depreciation cost because of commissioning of new pellet plant and Solar Power plant during the year under review.

The detailed performance and financial review has been given in the Annexure to the Directors Report titled "Management Discussion and Analysis"

EXPANSION/NEW PROJECTS

Pellet Plant:

Your Directors are pleased to inform that the new pellet plant for expansion of pellet manufacturing capacity by 1.20 MTPA has been successfully commissioned in July, 2013 and started commercial operations from September, 2013, seven months ahead of scheduled date of commencement of commercial operations. The new pellet plant has been fully stabilized and is operating satisfactorily. The Company has invested Rs 424.82 crores towards implementation of said pellet plant. The pellet capacity of the Company has thus increased to 1.80 million tons per annum on stand-alone basis and 2.40 million tons

per annum on consolidated basis including pellet capacity in subsidiary Company

Expansion cum balancing Plan in Steel Melting (SMS) and Rolling Capacity:

Your Company is presently operating a steel melting capacity of 4,00,000 MT and Rolling Mill Capacity of 1,00,000 MT per annum. Your Company has undertaken an expansion cum modernization and balancing plan for improvement in capacity utilization in Steel Melting Shop (SMS) and enhancing capacity of Rolling Mill by setting up a new rolling mill with installed capacity of 3,00,000 TPA. The Company proposes to set up certain balancing equipment in SMS to improve the operating efficiency, capacity utilization and product range. Your Company also proposes to set up a new rolling mill to enhance the steel rolling mill capacity to 4,00,000 TPA matching the Steel melting shop in order to produce value added products to improve the operating margins. The cost of expansion project is envisaged to be around Rs 200 crores and is expected to be completed by September, 2015. The project shall be funded by nternal accruals from existing operations and raising of fresh debt. The overall debt gearing will remain at existing level in view of repayment of existing debt.

Solar Power Plant:

Your Company has achieved distinction of being the first Company in India to set up 50 MW Solar Thermal Power plant within record time. The solar power plant taken up by your Company under Jawaharlal Nehru National Solar Mission of Government of India has been successfully commissioned on 19th June, 2013, within the stipulated time and ahead of all other 6 similar projects awarded by the Government. The project has been set up under an SPV namely Godawari Green Energy Limited, a 100% subsidiary of your Company The operations of solar power project have been stabilized and the plant is now operating smoothly. The SPV has invested Rs 875 crores for setting up the said project which has been funded through debt & equity. The subsidiary Company has raised a debt of Rs 625 crores from Banks for part funding the project and your Company has contributed equity capital of Rs 194 Crores by subscribing to the equity capital of SPV byRs 145 crores and additionally contributed Rs 49 crores by way of 9% Optionally Convertible Cumulative Preference Shares (OCCPS) and the balance amount of Rs 56 crores has been raised by private placement of 9% OCCPS to a Strategic Investor. Each OCCPS shall be convertible into one equity share ofRs 10/- each at a premium of Rs 90/- per share any time after one year from the date of COD at the discretion of investor. On fully diluted basis the equity of your Company shall be 77.60%

Mining Projects:

Ari Dongri Iron Ore mines:

The Company has mined 3,26,358 tonnes of iron ore from its

Ari Dongri iron ore mines during the financial year as compared to 6,93,358 tonnes during the previous year. Your Company is in process of enhancing the capacity of Ari Dongri Iron Ore mines from 7,00,000 TPA to 12,00,000 TPA, for which Stage I forest approval from MoEF has been obtained and Environmenta approval is awaited. The Company is pursuing the matter and is hopeful of getting the approval in a couple of months

Boria Tibu Iron Ore mines:

The Company has started mine development cum mining activities at Boria Tibu Iron Ore mines in Chhattisgarh and the developmental activities are expected to be completed by September, 2014. The regular mining operations are expected to be started from October, 2014.

Coal Mines:

Your Company was allotted coal mines in Chhattisgarh by Ministry of Coal, with reserves of 243 million tons in consortium with four other companies. Your Company has taken effective steps for development of the mines as per regulatory requirement and was awaiting forest approval In the meantime, the Ministry of Coal, has de-allocated the coal mines. In order to protect it''s interest, the Company has obtained the status quo order from Hon''ble High Court of Delh and the matter is currently subjudice.

DIVIDEND RECOMMENDED

In view of satisfactory performance, the Board of Directors of your Company declared and paid interim dividend @15% (i.e. Rs 1.50 per equity share of Rs 10/- each) to the shareholders in March, 2014. In addition to the above, your Directors have pleasure in recommending payment of final dividend @ 10% i.e. Re.1.00 per equity share for the year under review, thereby taking the total dividend payment to 25% i.e. Rs 2.50 per share (previous year 25% i.e. Rs 2.50 per share) which is 14.64% of the net profit of the Company during the year. The total outflow of funds on account of payment of dividend will be Rs 8.19 crore as compared to Rs 9.48 crore during the previous year including dividend tax. No dividend tax is payable during the current financial year in view of the dividend tax paid by the subsidiary Company. Upon approval, the dividend shall be paid to all those shareholders whose names appear in the register of members as on the record date i.e. 19th September, 2014 fixed for payment of dividend

FINANCIAL SUMMARY:

During the year, your Company has raised funds of Rs 318.45 crores by way of Term Loans/Corporate Loans to augment the funds requirement for normal capital expenditure and long term working capital requirement. Your Company has further refinanced high cost debt of Rs 50 crores. Your Company is continuously making efforts to bring down the cost of funding The Company has been able maintain a comfortable long term debt equity ratio of 1.17:1 (previous year 1.12:1) as on 31st

March, 2014 on stand-alone basis. The Company is regular in making payment of instalment of term loan and interest on loans including debentures.

Your Company is further looking to refinance the high cost debt during the current year including the debt in subsidiary Company to bring down cost of funding

TRANSFER TO RESERVES

The Company has transferred Rs 6.00 crores to General Reserve from the surplus balance in the statement of Profit and loss account.

REDEMPTION OF DEBENTURES AND REVERSAL OF DEBENTURE REDEMPTION RESERVE:

During the financial year the Company has redeemed 500 Nos. of Series-A 12% Redeemable Non-Convertible Debentures of Rs 10 lacs each and transferred Rs 17.91 crores from Debenture Redemption Reserve to General Reserve

PARTICULARS OF EMPLOYEES

None of the employees of the Company was in receipt of remuneration in excess of limits prescribed under section 217(2A) of the Companies Act, 1956 read with Rule 5 of Companies (Particulars of Employees) Rules, 1975. Hence, the particulars as required under said Rules are not applicable.

DIRECTORS

Pursuant to the provisions of Section 161(1) of the Companies Act, 2013 and the Articles of Association of the Company, Ms. Bhavna G. Desai was appointed as an Additional Director w.e.f. 9th August, 2014 and she shall hold office up to the date of the ensuing Annual General Meeting. The Company has received notice in writing from a member proposing Ms. Bhavna G. Desai for appointment as an Independent Director. The appointment of Ms. Bhavna G. Desai as Independent Director on the Board of Company shall fulfill the requirements of section 149(1) of the Companies Act, 2013 regarding appointment of a Woman Director on the Board of the Company

During the year under review Shri Siddharth Agrawal resigned from the Directorship of the Company with effect from 09.11.2013 to enable himself to concentrate in the operations of the subsidiary Company''s 50 MW Solar Thermal Power Plant. The Board places on record deep sense of appreciation for the services rendered by the resigning Director.

Shri Dinesh Gandhi resigned as Whole Time Director of the Company with effect from 09.11.2013 to join the Board of the Company''s subsidiary M/s Godawari Green Energy Limited as Executive Director & CFO. However he continues to remain on the Board of the Company as a Non-executive Director.

In accordance with the provisions of section 152(6)(c) of the Companies Act, 2013 and the Company''s Articles of Association, Shri Abhishek Agrawal and Shri Vinod Pillai,

GODAWARI POWER & ISPAT LIMITED

Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for reappointment.

Moreover pursuant to the provisions of SEBI Circular dated 17.04.2014 and pursuant to the provisions of Section 149 of the Companies Act, 2013, Shri Biswajit Choudhuri, Shri Shashi Kumar, Shri B.N. Ojha and Shri Harishankar Khandelwal, ndependent Directors of the Company shall be reappointed for a period of 5 years for a term up to the conclusion of the Annual General Meeting of the Company in the calendar year 2019. The Company has received requisite notices in writing from a member proposing Shri Biswajit Choudhuri, Shri Shash Kumar, Shri B.N. Ojha and Shri Harishankar Khandelwal for appointment as Independent Directors.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges.

DIRECTORS'' RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, your Directors based on the representation received from the operating management and CFO of the Company, confirm

a. That in the preparation of the annual accounts, the applicable accounting standards have been followed;

b. That your Directors have selected such accounting policies and applied them consistently, and made judgment 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;

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

d. That your Directors have prepared the annual accounts on a going concern basis.

REAPPOINTMENT OF AUDITORS

M/sO.P. Singhaniaand Co., Chartered Accountants, Auditors of the Company, hold office until the conclusion of the forthcoming Annual General Meeting and being eligible have offered themselves for re-appointment. The Company has received a certificate from them to the effect that their re-appointment, if made, would be within the limits prescribed under Section 141 (3) (g) of the Companies Act, 2013 and that they are not disqualified for re-appointment and also satisfies the criteria as mentioned under Section 141 and they have obtained

peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

AUDITOR''S REPORT

There are no qualifying remarks in the Auditor''s Report on the Accounts of the company for the financial year 2013-14 and hence does not require any clarification

BORROWING IN EXCESS OF PAID-UP CAPITAL AND FREE RESERVES:

As per the provisions of clause (c) of sub-section (1) of Section 180 of the Companies Act, 2013, the shareholders of the Company through postal Ballot held on 03rd January, 2014 have passed the Special Resolution empowering the Board of Directors of the Company to borrow any sum or sums of money in excess of the aggregate of the paid up share capital and free reserves of the Company not exceeding the limit of Rs 1500 crores.

Similarly, as per the provisions of clause (a) of sub-section (1) of Section 180 of the Companies Act, 2013, the shareholders of the Company through postal Ballot held on 03rd January, 2014 have passed the Special Resolution empowering the Board of Directors of the Company to create charge / mortgage / hypothecation on all or any of the the movable / immovable properties of the Company

CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND CSR COMMITTEE

In accordance with the provisions of Section 135 of the Companies Act, 2013, the Board of Directors of the Company at their meeting held on 15th March, 2014 have constituted Corporate Social Responsibility (CSR) Committee consisting of three Directors out of which one Director is an Independent Director

The Composition of CSR Committee is as under

Name of Chairman /Member Category Designation

Mr.Shashi Kumar Member Independent (Chairman) Director

Mr.Abhishek Agrawal Member Executive Director

Mr.Vinod Pillai Member Executive Director

The said Committee has been entrusted with the responsibility of formulating and recommending to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR activities

FIXED DEPOSITS

The Company has not accepted any fixed deposits from Public and is, therefore, not required to furnish information in respect of outstanding deposits under the Non Banking & Non financia Companies (Reserve Bank) Directions, 1966 and Companies (Acceptance of Deposits) Rules 1975

RISK MANAGEMENT POLICY

Overview

GPIL is committed to managing risk to ensure its business objectives are achieved and to optimise the value of the Company and meet the expectations of its stakeholders. Risk oversight and management is an organisation-wide priority, in which all officers and employees of GPIL participate

The risk management issues are discussed in detail in the report of Management Discussion and Analysis. The Company has taken necessary steps for risk management and the system is being strengthened on a continuous basis

The Company analysis the risk well before in advance & take necessary steps towards deviation if any occurs between the budgeted output & the actual output.

The Company also made a Risk Management Committee in which company evaluates the risk & discuss in details the necessary actions to be taken to protect the assets of the Company and maximize the profits. The company last held its Risk Management committee meeting on 28.05.2013

SUBSIDIARY COMPANIES:

As required under the provisions of Accounting Standard (AS) 21, the financial statements of Accounts of the subsidiary Companies have been consolidated with the account of the Company and the Consolidated Statements of Accounts are presented with this report.

The Ministry of Corporate Affairs vide General Circular dated 8th February, 2011 have granted a general exemption for the non-applicability of Section 212 of the Companies Act, 1956 upon fulfillment of certain conditions and the Company has complied with all the conditions provided therein. The annua accounts of the subsidiary companies and the related detailed nformation will be made available to the shareholders/investors seeking such information from the Company, at any point of time. The accounts of the subsidiary Companies are also available for inspection at the registered office of the Company and that of subsidiary companies respectively. The Company shall also furnish hard copy of details of accounts of subsidiaries to any shareholder on demand

A statement containing the salient features of the Financia Statements of the Subsidiaries of the Company is provided in the Annual Report.

JOINT VENTURE COMPANIES:

Your Company has made investments in two other specia purpose joint venture Companies, namely Chhattisgarh Captive Coal Mining Limited (CCCML) and Raipur Infrastructure Company Limited (RICL) respectively for development of Coa mines and for setting up railway siding respectively for captive use. The accounts of RICL (JV Company) has been consolidated

CCCML is still in the project stage. The Coal blocks allotted to the Company, has been de-allocated by Ministry of Coal and based on the petition filed by the Subsidiary Company, the Hon''ble High Court of Delhi has granted order for maintaining status quo. Your Company has so far invested a sum of Rs 5.94 crores towards development of coal block in CCCML. Pending final decision of High Court, the Company has not made any provision for loss of the investment of the Company in CCCML.

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

The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 217(1 )(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are provided in Annexure I to this Report.

COST AUDIT

The Central Government has approved the appointment of the M/s Sanat Joshi & Associates as cost auditors for conducting Cost Audit for the financial year 2013-14 for Steel Division of the Company. The due date for filing the Cost Audit Report for the financial year ended 31st March, 2014 is 30th September, 2014. The Company is in process of Complying with the requirement.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Section 205A(5) and 205C of the Companies Act, 1956, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with Companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on September 28, 2013 (date of last Annual General Meeting) on the Company''s website (www. godawaripowerispat.com), as also on the Ministry of Corporate Affairs'' website

ACKNOWLEGEMENTS

The Board expresses its sincere gratitude to the shareholders, bankers, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.

For and on behalf of Board of Directors Place: Raipur Date: 09.08.2014 Chairman


Mar 31, 2013

The directors have pleasure in presenting the 14th Annual Report on the business & operations of the Company together with the standalone and Consolidated Audited statement of financial Accounts for the year ended 31st march 2013.

Financial Results Rs. in Crore

Particulars Standalone Consolidated 2012-13 2011-12 2012-13 2011-12

Gross Sales 2160.02 1919.53 2685.34 2290.88

less: excise duty & taxes 248.39 187.97 328.63 230.45

Net Sales Turnover 1911.63 1731.56 2356.71 2060.43

other Income 9.70 3.04 14.78 11.33

Total Revenue 1921.33 1734.60 2371.49 2071.76

Proft before Interest, Depreciation, Tax and Amortisation (EBIDTA) 250.63 237.75 345.71 293.10

finance Costs 92.39 86.85 121.06 115.83

depreciation and amortisation expenses 52.27 51.07 70.92 67.67

Proft Before Taxation (PBT) 105.97 99.83 153.73 109.60

Taxation (including deferred Tax) (18.17) 20.89 (4.56) 22.02

Proft after Taxation (PAT) 124.14 78.95 158.29 87.58

less: minority Interest __ __ 9.48 3.31

Proft brought forward from previous year 300.71 266.67 318.16 283.84

less: Adjustment of deferred tax as per transitional provision 52.93 __ 52.93 __

Amount Available for Appropriations 371.92 345.62 414.04 368.11 Appropriations

Proposed dividend on equity shares 8.19 7.94 8.19 7.94

Corporate dividend Tax 1.29 1.29 1.39 1.38

Transfer to General Reserves 15.00 14.92 16.50 16.42

Transfer to debenture Redemption Reserve 30.66 20.75 30.66 20.75

Reversal of share of proft of associate on account of non consolidation __ __ __ 3.46

Total 55.14 44.90 56.74 49.95

Net Surplus 316.78 300.72 357.30 318.16



Review of Performance

The fnancial year 2012-13 was a yet another challenging year due to slow down in Indian economy and industrial production and infrastructure growth on account of high infation, politica scenario and ongoing european debt crises. despite these constraints and the challenging environment, your Company has performed reasonably well and achieved all round growth in its operations and proftability. The highlights of the fnancia performance are as under:

Standalone Operations:

- Gross sales revenue increased by 12.53% to Rs.2,160.02 crore from Rs.1,91 9.53 crore recorded in previous year and crossed Rs.2000 crore mark.

- PbT increased to Rs.105.97 crore from Rs.99.83 crore and PAT increased from Rs.124.14 crore to Rs.78.95 crore.

Consolidated Operations:

- Gross sales revenue increased by 17.22% toRs.2685.34 crore from Rs.2290.88 crore recorded in previous year and crossed Rs.2500 crore mark.

- ebIdTA margins decreased by 1.54% to Rs.345.71 crore from Rs.306.96 crore during previous year.

- PbT increased tof153.73 crore from Rs.109.60 crore and PAT increased from Rs.158.29 crore to Rs.87.58 crore. during the year under review your Company has recorded overall volume growth in production of across the divisions, except sponge iron, due to constant efforts made by the Company to improve operating effciency, which has resulted into increase in gross sales revenue. The operating margins remained fat due to increase in input cost on standalone basis. The operating margins on consolidated basis however, improved due to higher volumes & improvement in operations in Iron ore Pelletisation plant of subsidiary Company in orissa. your Company is making constant efforts to improve operating effciency. The detailed performance and fnancial review has been given in the Annexure to the directors Report titled "management discussion and Analysis".

Dividend

In view of satisfactory performance and keeping in view of the funds requirement for pursuing the growth strategies of the Company, your directors have the pleasure in recommending payment of dividend @ Rs. 2.50 per share (previous year Rs. 2.50 per share), subject to the approval of shareholders in the Annual General Meeting. The total outfow of funds on account of payment of dividend (including dividend tax) will be Rs.9.48 crore (previous year Rs.9.23 crore). upon approval, the dividend shall be paid to all those shareholders whose names appear in the register of members as on the record date, i.e. 20.09.2013, fxed for payment of dividend.

Expansion/New Projects

Pellet Plant:

The expansion project for setting up pellet plant with an installed capacity of 1.2 mTPA is progressing ahead of schedule, and the project is expected to be commissioned in Q2fy13. The Company has incurred a cost of Rs.343.30 crore in implementation of project till 31st march, 2013, which has been partially funded by debt of USD 60 million and balance amount from internal accruals. The plant shall source the iron ore fnes from the existing captive iron ore mines in Chhattisgarh and also partial procurement from market.

Solar Power Plant:

your Company is setting up 50 mw solar thermal power project at village: noukh, dist: Jaiselmer, Rajasthan at a cost of Rs.795 crore under Jawaharlal Nehru Solar Mission of Government of India through a sPv Company m/s Godawari Green energy ltd (GGel), which is a wholly owned subsidiary of your Company. The project has been funded through debt equity ratio of 72:28. The project has been fully implemented and expected to be commissioned shortly and start commercial operation. The investment in the project has been almost completed. The subsidiary Company has raised a debt of Rs. 569 crore from Banks for part funding of the project and your Company has contributed equity funding of the project by subscribing to the equity capital of sPv by Rs.121 crore and additional contribution of Rs.49 crore by way of subscribing to 9% optionally Convertible Cumulative Preference shares (oCCPs) and the balance equity of Rs.56 crore has been raised by private placement of 9% oCCPs to a strategic Investor. each preference share shall be convertible into equity share of Rs. 10/- each at a premium of Rs.90/- per share. The oCCPs shall be convertible into equity shares of sPv any time after one year from the date of Cod at the discretion of investor.

Finance

during the year, your Company has raised funds of Rs.175 crore by way of Term loans to augment the funds requirement for normal capital expenditure and long term working capita requirement. Your Company has further refnanced high cost debt of Rs.60 crore. Your Company is continuously making efforts to bring down the cost of funding. The Company has been able maintain a comfortable long term debt equity ratio of 1:0.99 (previous year 1:0.65) as on 31st March, 2013, on standalone basis. Your Company is further looking to refnance the high cost debt during the current year including the debt in subsidiary Company to bring down cost of funding.

Issue of Share Warrants

Pursuant to the approval of the shareholders in the extra ordinary General meeting held on 25th June, 2012, your Company has issued 50,00,000 equity share warrants on preferentia basis to m/s hira Infra-Tek limited (hITl), a promoter group Company, at a price of Rs.130/- per share u/s 81(1A) of the Companies Act, 1956. Each warrant is convertible into one equity share of Rs.10/- each within a period of 18 months from the date of allotment.

during the year under review, hITl has exercised the right for conversion of 10,00,000 warrants into 10,00,000 equity shares of Rs.10/- each and the Company has allotted the same to hITl. The funds raised from the allotment of aforesaid warrants are being utilised for ongoing capital expenditure of the Company and its subsidiary Companies.

Alteration in Articles of Association of the Company

The shareholders of the Company at its extra ordinary Genera meeting held on 25th June, 2012, have approved the proposa for alteration in Articles of Association of the Company to empower the board of directors / Company to:

- serve the notices, reports, documents and other communication to shareholders in electronic mode.

- obtain postal ballots through electronic mode.

- Participate in General meeting(s) by the members through video conferencing and

- Participate in board meetings by the directors through video conferencing.

Fixed Deposits

The Company has not accepted any fxed deposits from Public and is, therefore, not required to furnish information in respect of outstanding deposits under the Non Banking & Non fnancia Companies (Reserve Bank) Directions, 1966 and Companies (Acceptance of Deposits) Rules 1975.

Subsidiary Companies

As required under the provisions of Accounting standard (As) 21, the fnancial statements of Accounts of the subsidiary Companies have been consolidated in the Consolidated statements of Accounts presented with this report.

The ministry of Corporate Affairs vide General Circular no. 2/11 dated 8th february, 2011, have granted a general exemption for the non-applicability of section 212 of the Companies Act, 1956, upon fulflment of certain conditions and the Company has complied with all the conditions provided therein. The annual accounts of the subsidiary Companies and the related detailed information will be made available to the shareholders/ investors seeking such information from the Company, at any point of time. The accounts of the subsidiary Companies are also available for inspection at the registered offce of the Company and of subsidiary Companies respectively. The Company shall also furnish hard copy of details of accounts of subsidiaries to any shareholder on demand.

joint venture Companies

your Company has made investments in two other specia purpose joint venture Companies, namely Chhattisgarh Captive Coal mining limited (CCCml) and Raipur Infrastructure Company limited (RICl) respectively for development of Coa mines and for setting up railway siding respectively for captive use. The accounts of RICl (Jv Company) has been consolidated. CCCml is still in the project stage and awaiting approval of ministry of environment & forest (moef) for commencement of coal mining at captive coal mine allotted by ministry of Coal, Govt. of India. your Company has so far invested a sum of

Rs.5.94 crore towards development of coal block in CCCml.

Foreign exchange earnings and outgo

during the year under review your Company has used foreign currency of Rs.219.67 crore (previous year Rs.76.55 crore) towards import of capital goods, raw materials, components and traveling expenses etc. The Company has earned Rs.2.89 crore (previous year Rs.3.11 crore) in foreign currency from sale of voluntary emission Reduction Credits (veR Credits) & sale of Goods on fob value during the year.

Particulars of employees

none of the employees of the Company was in receipt of remuneration in excess of limits prescribed under section 217(2A) of the Companies Act, 1956.

Directors

In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the Company, Shri Biswajit Choudhuri, shri shashi kumar and shri b. n. ojha, directors of the Company retire by rotation at the ensuing Annual General meeting and being eligible offer themselves for reappointment.

Directors'' responsibility statement

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, your Directors state:

a. That in the preparation of the annual accounts, the applicable accounting standards have been followed;

b. That your directors have selected such accounting policies and applied them consistently, and made judgment 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 fnancial year and of the proft or loss of the Company for that period;

c. That your Directors have taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

d. That your directors have prepared the annual accounts on a going concern basis.

Conservation of energy and technology absorption

Information on Conservation of energy, required to be disclosed under Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (disclosure of Particulars in the Report of directors) Rules, 1988, are given in the annexure to this report.

Auditors

m/s o.P. singhania and Co., Chartered Accountants, the statutory auditors of the Company, hold offce until the conclusion of the forthcoming Annual General meeting and being eligible have offered themselves for re-appointment. The Company has received a certifcate from them to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224 (1B) of the Companies Act, 1956 and they have obtained peer review certifcate as required under sebI Guidelines for appointment of statutory Auditors of listed Companies.

Auditor''s report

There are no qualifying remarks in the Auditor''s Report on the Accounts of the Company for the fnancial year 2012-13 and hence does not require any clarifcation.

Cost Audit

The Central Government has approved the appointment of the m/s sanat Joshi & Associates as cost auditors for conducting Cost Audit for the fnancial year 2012-13 for Steel Division of the Company. The due date for fling the Cost Audit Report for the fnancial year ended 31st March, 2013 is 30th September, 2013.

Acknowledgements

The board expresses its sincere gratitude to the shareholders, bankers, state and Central Government authorities and the valued customers for their continued support. The board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.



For and on behalf of board of directors

Place: Raipur

date: 28th may, 2013 Chairman


Mar 31, 2012

The Directors have pleasure in presenting 13th Annual Report on the business & operations of the Company together with the Standalone and Consolidated Audited Statement of Financial Accounts for the year ended 31st March, 2012.

Rs. in Crores

Particulars Standalone Consolidated

2011-12 2010-11 2011-12 2010-11

Gross Sales 1919.53 1031.31 2290.88 1234.62

Less: Excise duty & taxes 188.02 96.49 230.45 116.00

Net Sales Turnover 1731.50 934.82 2060.43 1118.62

Other Income 3.04 2.94 11.33 12.89

Total Revenue 1734.54 937.76 2071.76 1131.51

Profit before Interest, Depreciation and 237.75 196.36 293.10 247.79

Taxation (EBIDTA)

Interest 86.85 60.25 115.83 73.10

Depreciation 51.07 46.83 67.67 55.42

Profit Before Taxation (PBT) 99.83 89.28 109.60 119.27

Taxation (including Deferred Tax) 20.88 18.01 22.02 19.82

78.95 71.27 87.58 99.45

Less: Minority Interest -- -- 3.31 14.00

Share of Profits of Associates -- -- -- 0.42

Transfer on Amalgamation -- 9.60 -- (4.18)

Profit brought forward from previous year 266.67 210.30 283.84 228.92

Amount Available for Appropriations 345.62 291.17 368.11 310.61 Appropriations

Proposed Dividend on Equity Shares 7.94 7.94 7.94 8.51

Corporate Dividend Tax 1.29 1.32 1.38 1.51

Transfer to General Reserves 14.92 10.00 16.42 11.50

Transfer to Debenture Redemption Reserve 20.75 5.25 20.75 5.25

Reversal of share of profit of associate on -- -- 3.46 -- account of non consolidation.

TOTAL 44.90 24.51 49.95 26.77

Net Surplus 300.72 266.67 318.16 283.84

REVIEW OF PERFORMANCE

The financial year 2011-12 was a challenging year due to slow down in Indian Industrial production and infrastructure growth in India on account of high inflation, political scenario and ongoing European debt crisis. Despite these constraints and the challenging environment, your Company has performed reasonably and highlights of the performance are as under:

O Gross sales Revenue increased by 86% to Rs. 1919.53 crores from Rs. 1031.31 crores recorded in previous year.

O EBIDTA Margins increased to Rs. 237.75 crores from Rs. 196.36 crores during previous year.

O PBT Increased to Rs. 99.83 crores from Rs. 89.28crores.

During the year under review your Company has recorded overall volume growth in production across the divisions due to constant efforts made by the Company to improve operating efficiency, which has resulted into increase in gross sales revenue. The operating margin have declined during the year due to higher input cost on account of lower production volume from captive iron ore mines as compared to previous year on account of extended monsoon and other factors beyond the control of the Company. The operations of the captive iron ore mines have considerably improved during the last quarter of the fiscal year. Your Company is confident of improving the operating margin during current year.

The detailed performance and financial review has been given in the Annexure to the Directors Report titled "Management Discussion and Analysis".

DIVIDEND

In view of Satisfactory performance and keeping in view of the funds requirement for pursuing the growth strategies of the Company, your directors have pleasure in recommending payment of dividend @ Rs. 2.50 per share (previous year Rs. 2.50 per share), subject to the approval of shareholders in the Annual General Meeting. The total outflow of funds on account of payment of dividend (including dividend tax) will be Rs. 9.23 crores (previous year Rs. 9.26 crores). Upon approval, the dividend shall be paid to all those shareholders whose names appear in the register of members as on the record date i.e. 22.09.2012 fixed for payment of dividend.

EXPANSION/NEW PROJECTS

Pellet Plant

Your Company's second pellet plant with an installed capacity of 1,200,000 TPA is under implementation and the project is expected to be commissioned in Q2FY2014. The plant shall source the iron ore fines from the existing captive iron ore mines in Chhattisgarh and also partial procurement from market.

Solar Power Plant

Your Company is setting up 50 MW solar thermal power project at cost of Rs. 800 crores approx, under Jawaharlal Nehru National Solar Mission of Government of India through a SPV Company M/s Godawari Green Energy Ltd (GGEL), which is a wholly owned subsidiary of your Company. The project is expected to be commissioned by April, 2013 and the implementation of the project is going on as per schedules. Your Company has tied up the entire debt requirement of Rs. 569 crores from banks and has contributed equity capital of Rs. 121 crores in the SPV.

FINANCE

During the year, your Company has raised funds of Rs. 80 crores by way of private placement of Non Convertible Debentures to augment the funds requirement for normal capital expenditure and long term working capital. The Company has been able to maintain a comfortable debt equity ratio of 1:0.89 as on 31st March, 2012.

Your Company has also tied up funding of Rs. 300 crores for financing the expansion in iron ore pelletisation capacity from 600000 TPA to 1800000 TPA by setting up new Iron Ore Pellet plant.

ISSUE OF SHARE WARRANTS

The Board of Directors of the Company has approved the proposal for issue of 50,00,000 equity share warrants on preferential basis to the Promoters & Promoters group at a price of Rs. 130/- per warrant or price determined as per SEBI (ICDR) Regulations, 2009, whichever is higher, subject to the approval of Shareholders of the Company u/s 81(1A) of the Companies Act, 1956. Each Warrant shall be convertible into one equity share of Rs. 10/- each within a period of 18 months from the date of allotment. The funds raised from the allotment of aforesaid warrant shall be used for ongoing capital expenditure of the Company and its Subsidiary Companies.

FIXED Deposits

The Company has not accepted any fixed deposits from Public and is, therefore, not required to furnish information in respect of outstanding deposits under the Non Banking & Non financial Companies (Reserve Bank) Directions, 1966 and Companies (Acceptance of Deposits) Rules 1975.

subsidiary companies:

The information about the Subsidiary Companies are given in the annexure.

As required under the provisions of Accounting Standard (AS) 21, the financial statements of Accounts of the Subsidiary Companies have been consolidated in the Consolidated Statements of Accounts presented with this report.

The Ministry of Corporate Affairs vide General Circular No. 2/11 dated 8th February, 2011 have granted a general exemption for the non-applicability of Section 212 of the Companies Act, 1956 upon fulfillment of certain conditions and the Company has complied with all the conditions provided therein. The annual accounts of the subsidiary companies and the related detailed information will be made available to the shareholders/investors seeking such information from the Company, at any point of time. The accounts of the Subsidiary Companies are also available for inspection at the registered office of the Company and of subsidiary companies respectively. The Company shall also furnish hard copy of details of accounts of subsidiaries to any shareholder on demand.

JOINT Venture companies:

Your Company has made investments in two other special purpose joint venture Companies, namely Chhattisgarh Captive Coal Mining Limited (CCCML) and Raipur Infrastructure Company Limited (RICL) respectively for development of Coal mines and setting up railway siding respectively for captive use.

FOREIGN Exchange EARNINGS AND Outgo

During the year under review your Company has used foreign currency of Rs. 76.55 crores (previous year Rs. 23.49 crores) towards import of capital goods, raw materials, components and traveling expenses etc. The Company has earned Rs. 3.11 (previous year Rs. 0.67 crores) in foreign currency from sale of Voluntary Emission Reduction Credits (VER Credits) & Sale of Goods on FOB value during the year.

PARTICULARS OF EMPLOYEES

None of the employees of the Company was in receipt of remuneration in excess of limits prescribed under Section 217(2A) of the Companies Act, 1956.

DIRECTORS

Shri G. B. Desai, Chairman of the Company and an Independent Director has resigned from the directorship of the company with effect from 09.11.2011 due to personal reasons. The Board places on record its deep sense of appreciation for the services rendered and guidance given by the said director during the tenure of his office.

Shri Biswajit Choudhuri, Non Executive Independent Director of the Company has been appointed as the Chairman of the Company with effect from 09.11.2011 following the resignation of Shri G. B. Desai from the Board of the Company.

Shri Abhishek Agrawal has been appointed as Additional Whole Time Director on the Board of the Company with effect from 9th November, 2011. The Company has received notice under section 257 of the Companies Act, 1956 from shareholders proposing appointment of Shri Abhishek Agrawal as Director on the Board. The Board proposes to appoint him as Whole time Director on the Board of the Company in the ensuing Extra ordinary General Meeting Scheduled to be held on 25.06.2012.

Shri Dinesh Agrawal has resigned as Whole Time Director of the Company with effect from 09.11.2011. However, he will continue to be on the Board of the Company as a Non-Executive Director.

In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the Company, Shri Dinesh Agrawal and Shri Dinesh Kumar Gandhi, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for reappointment.

DIRECTORS RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, your Directors state:

a. That in the preparation of the annual accounts, the applicable accounting standards have been followed;

b. That your Directors 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 or loss of the company for that period;

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

d. That your Directors have prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY AND TECHNOLOGY AB- SORPTION:

Information on Conservation of Energy, required to be disclosed under Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988, are given in the annexure to this report.

AUDITORS

M/s O.P. Singhania and Co., Chartered Accountants, the statutory auditors of the Company, hold office until the conclusion of the forthcoming Annual General Meeting and being eligible have offered themselves for re-appointment. The Company has received a certificate from them to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224 (1B) of the Companies Act, 1956 and they have obtained peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

AUDITOR'S REPORT

There are no qualifying remarks in the Auditor's Report on the Accounts of the company for the financial year 2011-12 and hence does not require any clarification.

ACKNOWLEDGEMENTS

The Board expresses its sincere gratitude to the shareholders, bankers, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.

For and on behalf of Board of Directors

Place: Raipur Chairman

Date: 22nd May, 2012


Mar 31, 2011

To the members,

The Directors have pleasure in presenting 12th Annual Report on the business & operations of the Company together with the Standalone and Consolidated Audited Statement of Financial Accounts for the year ended March 31, 2011.

Financial Results

Rs. in Crores Particulars Standalone Consolidated

2010-11 2009-10 2010-11 2009-10

Gross Sales 1028.57 832.39 1232.06 886.80

Less: Excise duty & taxes 96.49 55.96 116.00 64.42

Net Sales Turnover 932.08 776.43 1116.05 822.38

Other Income 5.67 3.01 15.45 4.00

Total Revenue 937.75 779.44 1131.50 826.38

Profit before Interest, Depreciation and Taxation (EBIDTA) 196.36 125.63 247.79 134.51

Interest 60.25 32.04 73.10 33.72

Depreciation 46.83 31.62 55.42 34.15

Profit Before Taxation (PBT) 89.28 61.97 119.27 66.45

Taxation (including Deferred Tax) 18.01 10.57 19.82 10.62

Profit after Taxation (PAT) 71.27 51.40 99.45 56.03

Less: Minority Interest - - 14.00 -

Share of Profits of Associates - - 0.41 1.22

Transfer on Amalgamation 9.60 - 4.18 -

Profit brought forward from previous year 210.30 177.11 228.92 189.63

Amount Available for Appropriations 291.17 228.51 310.62 246.85

Appropriations

Proposed Dividend on Equity Shares 7.94 7.01 8.51 6.74

Corporate Dividend Tax 1.32 1.19 1.51 1.19

Transfer to General Reserves 10.00 10.00 11.50 10.00

Transfer to Debenture Redemption 5.25 - 5.25 - Reserve

Total 24.51 18.20 26.78 17.93

Amount carried to Balance Sheet 266.66 210.30 283.84 228.92

Merger of R.R. Ispat Ltd and Hira Industries Limited

The Hon'ble High Court of Chhattisgarh approved & confrmed the Scheme of Amalgamation of M/s RR Ispat Ltd (RRIL) and M/s Hira Industries Ltd (HIL) with your company during the year under review. The appointment date of the aforesaid Scheme of Amalgamation was April 1, 2010. Consequent upon the Scheme of Amalgamation becoming efective the financial statement of accounts presented herewith have been prepared after giving due efect of the aforesaid Scheme of Amalgamation and therefore the results to that extent are not comparable with the results of the previous year. Further pursuant to the said Scheme of Amalgamation 23,32,750 equity shares of erstwhile RRIL owned by your company have been cancelled and 11,25,000 equity shares of your company held by erstwhile RRIL have been transferred to a trust created in the name of GPIL Beneficiary Trust for the sole benefit of the Company. Your Company has allotted 36,86,440 equity shares of Rs.10/- each fully paid to the shareholders of erstwhile HIL and the same have been listed with BSE & NSE.

Consequent upon the aforesaid merger, M/s Hira Ferro Alloys Ltd. (HFAL), a company listed on BSE, MPSE, DSE & MSE and engaged in the business of manufacture of ferro alloys & captive power generation has become the subsidiary of your Company since the aggregate of the shareholding of your company together with the shares hitherto held by merged entities namely RRIL and HIL exceeded 51% of the total share capital of HFAL with efect from March 30, 2011 resulting in HFAL becoming subsidiary of your Company..

Review of Performance

During the fiscal 2011, your company has reported gross revenue of Rs.1028.57 crores as against Rs.832.39 crores in last fiscal, registering a growth of 24%. Your Company has earned Profit before tax of Rs.89.28 crores during the year under review as against Rs.61.97 crores during the previous year and net profit of Rs.71.27 crores as against Rs.51.40 crores during the previous year registering a growth of 38.66%. The silent features of the performance of your Company during the year under review are as under:

- Gross sales revenue up by 24% and turnover crosses over Rs.1,000 Crores

- The Iron Ore Mines achieved production volumes up by 58% to 330410 MT.

- The pelletisation plant got established in second half of the year resulting into substantial improvement in performance and production volumes.

The detailed performance and financial review has been given in the Annexure to the Directors Report titled "Management Discussion and Analysis".

Dividend

The Board of Directors of your Company has recommended payment of dividend @ of Rs.2.50 per equity share, subject to the approval of shareholders in the Annual General Meeting (AGM), on the enhanced Equity Share capital of the Company. The total outfow of funds on account of Dividend including dividend tax will be Rs.9.26 crores. The dividend shall be paid, subject to the approval of shareholders in the ensuing AGM, to all those shareholders whose names appear in the register of members as on the record date i.e. August 22, 2011 fixed for the payment of dividend.

Expansion & Future Plans

Pellet Plant:

Your Company has successfully commissioned a pellet plant at the existing plant location at Raipur, Chhattisgarh with an installed capacity of 600000 TPA during Feb, 2010 and subsequently during the previous year the operations have been stabilised and the plant has reached an operating level of about 90% during the H2FY11. Your Company has also set up another Pellet Plant with an installed capacity of 600000 TPA in Keonjhar District in Orissa through a subsidiary Company M/s Ardent Steel Ltd, which has also started production during the year under review and has reached CUF of 50%. The project is expected to be commissioned in Q2FY12.

Looking at the success of above pellet plants and further growth potential in use of pellet in manufacturing of steel, the board of directors of your Company have decided to set up another pellet plant with an estimated investment of Rs 350 crores in Chhattisgarh. The plant is expected to source the iron ore fines from the exiting captive iron ore mines in Chhattisgarh and also partial procurement from the mines in Orissa. The project is expected to become operational in next 2 years.

Power Plant:

Your Company believes in the sustainable growth through environment protection and accordingly your Company has taken various initiatives towards generation of electricity through renewable energy sources. Your Company is already operating 42MW of power generation capacity through waste heat recovery process. The 20 MW Bio Mass (Rice husk based) has been commissioned in October 2010 and started commercial operation during the year under review.

Your Company has during previous year taken a major initiative towards generation of power through renewable energy sources by venturing into setting up a 50 MW solar thermal power plant under Jawaharlal Nehru Solar Mission of Government of India. Your Company was one of the seven successful bidders under a competitive bidding by Ministry of New & Renewable Energy (MNRE), Government of India, through NTPC Vidyut Vyapar Nigam Limited and your Company has been selected to set up a 50MW Solar Termal Power Plant in Rajasthan. Your Company is setting up aforesaid solar power project at cost of Rs 800 crores approx, through a SPV Company M/s Godawari Green Energy Ltd (GGEL), which is a wholly owned subsidiary of your Company. The project is proposed to be funded through debt equity ratio of 70:30.

Finance

In order to meet the funds requirement for normal capital expenditure, margin for working capital and general corporate purposes, during the year under review your Company has issued 1250, 12% Secured Redeemable Non-Convertible Debentures of Rs.10 lacs each aggregating to an amount of Rs.125.00 crores. The door to door tenure of debentures is 6 years and debentures are listed on BSE.

Fixed Deposits

The Company has not accepted any fixed deposits from Public and is therefore not required to furnish information in respect of outstanding deposits under the Non Banking & Non financial Companies (Reserve Bank) Directions, 1966 and Companies (Acceptance of Deposits) Rules 1975.

Subsidiary Companies

The information about the subsidiary Companies are given in the annexure.

As required under the provisions of Accounting Standard (AS) 21, the financial statements of Accounts of the subsidiary companies have been consolidated in the Consolidated Statements of Accounts presented with this report.

The Ministry of Corporate Afairs vide General Circular No. 2/11 dated February 8, 2011 have granted a general exemption for the non- applicability of Section 212 of the Companies Act, 1956 upon fulfillment of certain conditions and the Company has complied with all the conditions provided therein. The annual accounts of the subsidiary companies and the related detailed information will be made available to the shareholders/investors seeking such information from the Company, at any point of time. The accounts of the subsidiary companies are also available for inspection at the registered ofice of the Company and of subsidiary companies respectively. The Company shall also furnish hard copy of details of accounts of subsidiaries to any shareholder on demand.

Joint Venture Companies

Your Company has made investments in two other special purpose joint venture Companies, namely Chhattisgarh Captive Coal Mining Limited (CCCML) and Raipur Infrastructure Company Limited (RICL) respectively for development of Coal mines and setting up railway siding respectively for captive use.

Foreign Exchange Earnings And Outgo

During the year under review your Company has used foreign currency of Rs.23.49 crore (previous year Rs.4.41 crore) towards import of capital goods, raw materials, components and traveling expenses etc. The Company has earned Rs.0.67 crore in foreign currency from sale of Voluntary Emission Reduction Credits (VER Credits) during the year.

Particulars Of Employees

None of the employees of the Company was in receipt of remuneration in excess of limits prescribed under Section 217(2A) of the Companies Act, 1956.

Directors

Shri Dinesh Agrawal and Shri Vinod Pillai, Non-Executive Directors on the Board of the Company have been appointed as Whole Time Directors with efect from June 1, 2011. Shri Dinesh Agrawal was the Managing Director and Shri Vinod Pillai was a senior executive of erstwhile M/s R. R. Ispat Ltd. which has since merged with your Company.

Shri Siddharth Agrawal has resigned as Whole Time Director of the Company with efect from August 6, 2011. However, he will continue to be on the Board of the Company as a Non-Executive Director.

Shri O.P. Agrawal, Vice Chairman of the Company and Shri N.P. Agrawal, Non Executive Director of the company have resigned from the directorship of the company with effect from August 6, 2011 due to their personal reasons. The Board places on record its deep sense of appreciation for the services rendered and guidance given by the said directors during their tenure of office.

In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the Company Shri G. B. Desai and Shri Vinod Pillai, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for reappointment.

Directors' Responsibility Statement

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, your Directors state:

That in the preparation of the annual accounts, the applicable accounting standards have been followed;

That your Directors have selected such accounting policies and applied them consistently, and made judgment 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 or loss of the company for that period;

That your Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of your company and for preventing and detecting fraud and other irregularities; and That your Directors have prepared the annual accounts on a going concern basis.

Conservation of Energy and Technology Absorption

Information on Conservation of Energy, required to be disclosed under Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988, are given in the annexure to this report.

Auditors

M/s O.P. Singhaniaand Co., Chartered Accountants, the statutory auditors of the Company, hold office until the conclusion of the forthcoming Annual General Meeting and being eligible have offered themselves for re-appointment. The Company has received a certificate from them to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224 (1B) of the Companies Act, 1956 and they have obtained peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

Auditor's Report

There are no qualifying remarks in the Auditor's Report on the Accounts of the company for the financial year 2010-11 and hence does not require any clarification.

Acknowlegements

The Board expresses its sincere gratitude to the shareholders, bankers, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.

For and on behalf of the Board of Directors

Date: August 6, 2011 Chairman

Place: Raipur


Mar 31, 2010

The Directors have pleasure in presenting 11th Annual Report on the business & operations of the Company together with the Standalone and Consolidated Audited Statement of Financial Accounts for the year ended 31st March 2010.

FINANCIAL RESULTS (Rs. in Crores)

Standalone Consolidated Particulars 2009-10 2008-09 2009-10 2008-09 iii

Net Sales Turnover 776.43 1035.54 822.38 1091.98

Other Income 3.01 10.40 4.00 11.41

Total Revenue 779.44 1045.94 826.38 1103.39

Profit before Interest,

Depreciation and 125.63 125.85 134.51 134.31

Taxation (EBIDTA)

Interest 32.04 34.17 33.72 35.60

Depreciation 31.62 26.42 34.15 28.48

Profit Before Taxation & Exceptional Items

Exceptional Items 0.00 0.00 0.00 0.00

Profit before Taxation JB 61.97 65.26 66.45 70.23

(PBT)

Taxation (including Deferred Tax) 10.57 7.90 10.62 8.77

Profit after Taxation (PAT) 51.40 57.36 56.03 61.46

Minority Interest - - 0.00 0.00

Share of Profits of - - 1.22 0.86 Associates

Profit after minority

interest & share of profit - - - -

of Associates

Profit brought forward 177.11 137.96 246.85 207.56

from previous year

Amount Available for 228.51 195.32 207.56 207.56 Appropriations Appropriations

Proposed Dividend on 7.01 7.01 6.74 6.74 Equity Shares

Corporate Dividend Tax 1.19 1.19 1.19 1.19

Transfer to General 10.000 10.00 10.00 10.00 Reserves

Total 18.20 18.20 17.93 17.93

Amount carried to 210.30 177.11 228.92 189.92

Balance Sheet

The fiscal year under review was a very crucial year after the global slowdown & re-emergence of the economics all across the globe. The year was also very crucial for the steel manufacturers especially domestic steel manufacturing, when the input prices climbed upward without corresponding increase in selling prices of finished products resulting into lower realizations.

In fiscal 2010, GPIL reported gross revenue of Rs. 832.39 crores, 28% less as compared to last fiscal. The fall was mainly because the difficult market conditions especially in the first half of the year which led to lower realization across the product range. DRI production during the year under review was 285833 MTs as compared to 279533 MTs during last year but the average realization for the year was Rs 13130as compared to Rs 15750 in the previous financial year, a fall of almost 17% which led to fall in revenue and profitability. Performance was affected by the difficult global economic and operating environment throughout the year but still with the onset of captive iron ore mining our EBITDA margins was increased from 12.15% to 16.18%, a significant jump of over 400 bps which if taken as indicator for next year gives very good signals of better performance for years to come along- with ramp of production in captive iron ore mines.

In 2009, power division contributed Rs. 129.07 crores to the revenue & Rs.75.54 crores to the EBITDA, remaining the most important division by the share of EBITDA for the year. Steel billets contribution to the Companys revenue is Rs.135.76 crores, a fall of 67.4% from last year owing to Companys strategy of sale of power in short term market, rather in consumption in Steel Billet Division. Wire Drawing (HB Wire) contributed Rs.221.04 crores to the top line, 25% lower than in 2009 again owing to fall in selling prices.

We believe that with our integrated business model, we can achieve the best returns in the industry over the cycle upon full ramp up of the production in captive iron mines and commencement of production in captive coal mine, which still awaits forest & environmental approval from Ministry of Environment & Forest.

DIVIDEND

The Board, subject to the shareholders approval in the AGM, recommended payment of dividend @ of Rs 2.50 per equity share on the Equity Share capital of the Company. The total outflow of funds on account of Dividend including dividend tax will be Rs.8.21 crore, which is same as in fiscal 2009. The dividend shall be paid, subject to the approval of shareholders in the ensuing AGM, to all those shareholders whose names

appear in the register of members as on the record date i.e. 16th September, 2010 fixed for the payment of dividend.

FIXED DEPOSITS

The Company has not accepted any fixed deposits from Public and is therefore not required to furnish information in respect of outstanding deposits under the Non Banking & Non financial Companies (Reserve Bank) Directions, 1966 and Companies (Acceptance of Deposits) Rules 1975.

EXPANSION & FUTURE PLANS

This year has been very significant at GPIL. We got all the mining clearance for our iron ore mine-Ari Dongri and so have started mining operations in May2010. We were able to mine 322352 MTs during the year. Our other iron ore mine- Boria Tibu has also received all the clearances and the Company expects it to commence production during the current year. With the commencement of captive iron ore mining, our dependence on iron ore purchases from open market has gone down substantially in the year under review and we look forward to be completely self sufficient from current year onwards. Thus we will be completely insulated from raw material (iron ore) price fluctuation.

Also, in the year under review, iron ore Pelletization plant with a capacity of 600000 MTPA at Siltara, Raipur have also started commercial production. This is very significant factor considering the iron ore price movement in the recent period. Our corporate philosophy has been to utilize the maximum of mineral resources and environment protection by utilization of waste products. Thus by utilizing the iron ore fines which were till now exported to China at significant lower value will now be utilized by us in making pellet which are directly usable in the Sponge Iron manufacturing. This has been a significant backward integration for us as we expect the feed rate of raw material to go down & thereby improvement in the efficiency of sponge irons production.

Your Company was among very few first to foresee the value of the fines which otherwise is being sold at no real value in export market, due to huge differential in pricing of iron fines & calibrated ore. With the successful commissioning of our pellet plant, we have seen other steel manufacturers putting up pellet plants for their captive use/merchant sale of pellets.

Your Company have taken 75% stake in Ardent Steel Limited which is also setting up 600000 MTPA pellet plant in Keonjhar District, in Orissa. The plants operations got delayed for unforeseen reason and the Company expects to start commercial operations during the first half of the current year. The 20 MW Bio-Mass Power plant under implementation is also

delayed due to delay in supply of equipment by the vendors is also expected to be commence operations very soon.

Now, since all earlier projects have been completed or either on the verge of being completed, we are evaluating various options to set the future course of action. We have signed various MOUs with the Chhattisgarh Government and are all set to move to next phase of expansion for which suitable location is being identified.

We are scouting for opportunities to set up a green field steel plant along with other allied steel facilities. We are also awaiting regulatory clearances & coal linkages allocation before we can start work on the 1200 MW power plant in our 100% the Subsidiary Company Godawari Energy Limited.

MERGER OF RR ISPAT LTD AND HIRA INDUSTRIES LIMITED

During the year under review the Board of Directors of your Company has approved a scheme of merger of 100% subsidiary Company M/s RR Ispat Ltd and another Company M/s Hira Industries Ltd, subject to the approval of the Honble High Court of Chhattisgarh. Appointed date of the proposed scheme is 1st April, 2010. The BSE and NSE have since approved the proposed scheme of merger and the same has been filed with Honble High Court for approval. The scheme is presently awaiting the approval of the High Court and the same will be effective upon the receipt of approval of High Court. The effect of the scheme in the financial statements of the Company shall be given upon the scheme becoming effective.

SUBSIDIARY/ASSOCIATE/JOINT VENTURE COMPANIES:

Ardent Steel Limited (ASL)

Your company has acquired 75% of the equity shares of M/s. Ardent Steel Limited, which is setting up an iron ore pelletisation plant in the State of Orissa. The project is expected to be commissioned and commercial operations are expected to commence during the first half of the current year.

RR Ispat Ltd (RRIL)

M/s. R. R. Ispat Ltd, is engaged in the rolling of billets manufactured by your Company into wire rods and further conversion of wire rods into wires has achieved net sales of Rs.216.02 crore (previous year Rs. 230.42crores) and net profit of Rs.4.29 crore (previous year Rs. 3.73crore) during the financial year 2009-10. The Company has taken up project for expansion cum modernization of the rolling mill which has been partially completed during the current year. Upon completion of Expansion Project, the installed capacity of rolling mill shall stand increased to 2,00,000 MTPA. During the year under review, the Company also increased the installed capacity of Wind Power Project from 1.20 MW to 2.70 MW p.a.

Godawari Energy Limited: (GEL)

M/s. Godawari Energy Limited has entered into an MOU on 17th September, 2008 with the Government of Chhattisgarh for setting up of 1200 MW capacity of Thermal Power Project. The Company is presently engaged in getting regulatory approvals and land acquisition process for setting up the power plant. The company has acquired around 130 acres of private land in Raigarh District of Chhattisgarh. The implementation of project shall be taken up upon the receipt of regulatory approvals and availability of fuel linkages.

Godawari Clinkers and Cement Limited (GCCL)

Your company has signed an MOU with Government of Chhattisgarh for setting-up of Cement Plant comprising of 2 million tons per annum capacity of Cement and 1 million ton per annum capacity of clinker along with captive Power Plant of 50 MW capacity through a subsidiary Company and accordingly promoted another 100% subsidiary Company in the name of M/s. Godawari Clinkers & Cement Limited. The Company has applied for grant of mining lease for lime stone mines in Chhattisgarh and approval of mining lease is awaited.

Krishna Global Minerals Limited (KGML)

Your company has acquired 100% of the equity shares of M/s. Krishna Global Minerals Limited for doing the business of exploration of mines and minerals, which is in the initial stage.

As required under the provisions of Accounting Standard (AS) 21, the financial statements of Accounts of the subsidiary Company have been consolidated in the Consolidated Statements of Accounts presented with this report.

As per Section 212 of the Companies Act, 1956, the financial statement of the accounts of the subsidiary Companies along-with Directors Report and Auditors Report thereon are required to be attached with the annual report. The Company has sought an exemption from the Ministry of Corporate Affairs, Government of India, for publication of financial statements of the subsidiary under section 212 of the Companies Act, 1956 and accordingly the financial statements of subsidiary Companies are not separately included in the annual report.

The annual accounts of the subsidiary Companies and the related detailed information will be made available to the shareholders/investors seeking such information from the Company, at any point of time. The accounts of the subsidiary Companies are also available for inspection at the registered office of the Company.

Hira Steels Limited: Associate Company

Hira Steels Limited, an Associate Company engaged in rolling of steel billets into wire rods and further conversion of wire rods into wires has achieved net sales turnover of Rs. 200.23 crores (previous year Rs. 293.23) with a net profit of Rs. 5.23 crore (previous year Rs. 3.68 crores). In compliance with provision of Accounting Standard (AS) 23, the Financial Statements of Accounts of the Company have been consolidated in the Consolidated Statements of Accounts your Company presented with this report.

JV Companies:

Your Company has made investments in two other special purpose joint venture Companies, namely Chhattisgarh Captive Coal Mining Limited (CCCML) and Raipur Infrastructure Company Limited (RICL) respectively for development of Coal mines and setting up railway siding respectively for captive use.

FOREIGN EXCHANGE EARNINGS AND OUTGO

During the year under review your Company has used foreign currency of Rs.4.41 crore (previous year Rs.59.06 crore) towards import of capital goods, raw materials, components and traveling expenses etc. There was no earning in foreign exchange during the year.

PARTICULARS OF EMPLOYEES

None of the employees of the Company was in receipt of remuneration in excess of limits prescribed under Section 217(2A) of the Companies Act, 1956.

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the Company, Shri Shashi Kumar, Shri B. N. Ojha and Shri Siddharth Agrawal, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for reappointment..

DIRECTORS RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, your Directors state:

a. That in the preparation of the annual accounts, the applicable accounting standards have been followed;

b. That your Directors have selected such accounting policies and applied them consistently, and made judgment 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 or loss of the company for that period;

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

d. That your Directors have prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:

Information on Conservation of Energy, required to be disclosed under Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988, are given in the annexure to this report.

CSR ACTIVITIES

Your company believes in the philosophy of "Serving Society through Industry" and we live every moment of life in harmony with nature to create value for ourselves, our stake holders and the society. Your company is committed to improve health and education awareness, conduct affairs of our company in a socially acceptable manner, understand supporting and developing the communities and the cultures within which we work, protect the environment and safety of the people connected with the company and the surroundings, enhance the value of the company through sustainable growth. Your company has adopted Educational Institutes like ITI under Public Private Partnership scheme of Govt, of India, Akansha school for mentally retarded students, Agrasen College for their upgradation. Donations in various Govt, schemes like "Dattak Putri Siksha Yojana". Another part of our CSR work for good health of people through blood donation camps, donation of Mobile Medical Unit for Helpage India, financial assistance provided to Gram Panchayat for purchasing Ambulance.

We for our environment by returning what we have consumed, by planting more than 20,000 plants in the surrounding region and in the plant premises. Following our vision in the field of sports, your company has extended due support by sponsoring sportsmen and women for participating in national tournament. At our mines, your company has campaigned for Cleanliness & Sanitation, Cleaning of Ponds, organized Exhibition on Environment Conservation and contributed to Gram Vikas Samiti for developing infrastructural facilities in the village along with safe drinking water to the nearby Villages.

AUDITORS

M/s O.R Singhania and Co., Chartered Accountants, the statutory auditors of the Company, hold office until the conclusion of the forthcoming Annual General Meeting and being eligible have offered themselves for re-appointment. The Company has received a certificate from them to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224 (1B) of the Companies Act, 1956 and they are in the process of obtaining peer review certificate as required under SEBI Guidelines for appointment of Statutory Auditors of listed companies.

AUDITORS REPORT

There are no qualifying remarks in the Auditors Report on the Accounts of the company for the financial year 2009-10 and hence does not require any clarification.,

ACKNOWLEGEMENTS

The Board expresses its sincere gratitude to the shareholders, bankers, State and Central Government authorities and the valued customers for their continued support. The Board also wholeheartedly acknowledges and appreciates the dedicated efforts and commitment of all employees of the Company.

Place: Raipur, For and on behalf of Board of Directors Date: 30th May, 2010 Chairman

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