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Directors Report of Indian Metals & Ferro Alloys Ltd.

Mar 31, 2015

Dear Members,

The Directors are pleased to present the 53rd Annual Report together with Audited Statement of Accounts of the Company for the financial year ended 31st March, 2015.

FINANCIAL RESULTS

Rs. in Crore

FY 2014-15 FY 2013-14

1 Revenue from operations 1,344.79 1,317.85

2 Other Income 21.78 22.03

3 lotal Revenue 1,366.57 1,339.88

4 Profit before interest, 262.90 310.34 depreciation, taxation, prior period income and exceptional items

5 Interest 108.62 108.21

6 Depreciation 121.94 149.02

7 Profit before lax 33.34 53.11

8 Tax including Deferred Tax 21.36 13.99

9 Profit after lax 11.98 39.12

10 Proposed dividend 4.69 9.12 (including Tax on dividend)

11 Transfer to General 0.60 4.00 Reserve

During the year under review, revenue from operations grew by 2.04 % to reach a new high of Rs. 1,344.79 Crore (previous year: Rs. 1,317.85 Crore) including foreign exchange earnings of Rs. 1,032.47 Crore (previous year: Rs. 1,042.69 Crore). However, EBIDTA fell by 15.29% to Rs. 262.90 Crore (previous year: Rs. 310.34 Crore) and profit after tax declined by 69.38% to Rs. 11.98 Crore (previous year: Rs. 39.12 Crore) on account of difficult market conditions.

DIVIDEND

Your Board of Directors is pleased to recommend for approval of the members a dividend of 15% (Rs. 1.50/- per share) on the equity shares of the Company for the FY 2014-15.

STATE OF COMPANY''S AFFAIRS

Ferro Alloys

The production of ferro chrome during the year under review increased by 3.60% to 205,203 tonnes (previous year: 198,063 tonnes) and for the first time all six furnaces were in operation.

Electricity

During the year under review your Company generated 913.92 MU''s of electricity (previous year: 909.83 MU''s) and sold 17.96 MU''s to Gridco. Generation was mainly for captive requirement and supply to Gridco was limited on account of low tariff for surplus power along with an intimation not to schedule 14% of the generation of the 120 MW captive power plant.

Mining

Chrome Ore production during the year under review was 4,14,138 tonnes as compared to 5,05,172 tonnes during the previous year. The mining activity at the Company''s Mahagiri Chromite Mines was suspended from 1st February, 2015 till 7 th May, 2015 due to non-availability of environment clearance (EC) and ''Consent to Operate'' (CTO). However, the Company has since obtained EC which is co-terminus with the lease period and CTO which is valid upto 30th September, 2015 and mining operations have restarted. Similarly, mining activities at Sukinda Chromite Mines was also suspended from 1st April, 2015 till 7 th May, 2015 due to lack of CTO; mining activity has since restarted upon receipt of CTO which is valid till 30th September, 2015.

Mining activity at Nuasahi Chromite Mines has been stopped with effect from 30th November, 2014 due to expiry of the mining lease. The Company had already filed renewal application on 20th November, 2013 and, consequent to the provisions of the new MMDR Act, is eligible for an extension of 15 years.

It is pertinent to note here that your Company has consistently followed in letter and spirit the practice of value addition and limiting ore raising from its captive mines to that required for captive consumption thus maximising contribution to the exchequer.

EXTRACT OF THE ANNUAL RETURN

An extract of annual return for the financial year ended on 31st March, 2015 in Form MGT-9 pursuant to Section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014 is attached as Annexure-1.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times in FY 2014-15 viz. on 20th May, 2014, 22nd July, 2014, 29 th October, 2014 and 3rd February, 2015. The maximum interval between any two meetings did not exceed 120 days.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to provisions under Section 134(5) of the Companies Act, 2013, your Directors hereby confirm:

(i) that in the preparation of the annual accounts for the financial year ended 31st March, 2015, the applicable accounting standards read with requirements set out under schedule III of the Companies Act, 2013 have been followed and there are no material departures from the same;

(ii) that they have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 for the year under consideration;

(iii) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

(iv) that they have prepared the annual accounts of the Company for the financial year ended 31st March, 2015 on a going concern basis;

(v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

(vi) that they had devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DECLARATION GIVEN BY INDEPENDENT DIRECTORS

The Independent Directors have given declaration that they meet the criteria specified under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION

The Policy of the Company on Directors'' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under sub-Section (3) of Section 178, is attached as Annexure-2 to this Report.

AUDITORS AND AUDITORS'' REPORT

Statutory Auditors

Observation of the Auditors, M/s Haribhakti & Co LLP, on the financial statements of the Company have been dealt with in the Notes to the Accounts annexed as Note which are self- explanatory. Qualification of the Auditor has been dealt in Note No 13.1 of the Financial Statements. No provision is considered by the Company, at this stage, towards any diminution on the value of its investment in Indmet Mining Pte Ltd as the Company has invoked an agreement between the Indian and Indonesian governments for the promotion and protection of investments.

Secretarial Auditor

There are no qualifications, reservations or adverse remarks or disclaimers made in their secretarial audit report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The Company has provided following guarantees and made following investments pursuant to Section 186 of the Companies Act, 2013:

Name of the entity Relation Amount Rs. in Crore

Utkal Coal Limited Subsidiary 110.00

Utkal Power Limited Wholly owned 0.40 subsidiary

Particulars of Purpose for which the loan, loans,guarantees and guarantee and investment are investments proposed to be utilised.

Guarantee given for availing To secure the due repayment of loan to SREI Infrastructure loan together with interest. Finance Limited

Investment in the equity To meet the expenses/ liablities. shares

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

There are no contracts/arrangements/transactions which are not at arm''s length basis and there are no material contracts/ arrangements/transactions which are at arm''s length basis.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

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

ENERGY CONSERVATION, ETC.

The information required under Section 134 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 are set out in Annexure-3 hereto forming part of this report.

RISK MANAGEMENT POLICY

The Company has a Risk Management framework in place which is designed to identify, assess and monitor various risks related to key business and strategic objectives and lead to the formulation of a mitigation plan. All identified risks are categorised based on a matrix of likelihood of occurrence and impact thereof and a mitigation plan is worked out to the extent possible. Major risks in particular are monitored regularly at meetings of the Executive Risk Committee and the Board of Directors of the Company is kept abreast of such issues.

CORPORATE SOCIAL RESPONSIBILITY

The details about the development of Corporate Social Responsibility Policy and initiatives taken by the Company on Corporate Social Responsibility during the year as per Companies (Corporate Social Responsibility Policy) Rules, 2014 have been appended as Annexure-4 to this Report.

ANNUAL EVALUATION BY THE BOARD

The evaluation framework for assessing the performance of Directors comprises of the following key areas:

i) Attendance of Board Meetings and Board Committee Meetings

ii) Quality of contribution to Board deliberations

iii) Strategic perspectives or inputs regarding future growth of Company and its performance

iv) Providing perspectives and feedback going beyond information provided by the management

v) Commitment to shareholder and other stakeholder interests

The evaluation involves Self-Evaluation by the Board Member and subsequently assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/her evaluation.

RATIO OF REMUNERATION

Pursuant to Section 197(12) of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the ratio of remuneration of each director to the median employee''s remuneration and such other details are furnished below.

i) the ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year:

Name of the Director Ratio Name of the Director Ratio

Dr B Panda 55:1 D Bandyopadhyay 0.17:1

Baijayant Panda 56:1 N R Mohanty 0.07:1

Subhrakant Panda 63:1 General Shankar 0.04:1 Roychowdhury (Retd.)

J K Misra 31:1 Major R N Misra (Retd.) 0.21:1

C R Ray 24:1 Dr S Acharya 0.38:1

Paramita Mahapatra 0.67:1 S P Mathur 0.15:1

Alex Amrein NIL S Nautiyal 0.04:1

ii) the percentage increase in remuneration of each Director, Chief Financial Officer & Company Secretary and Chief Executive Officer, in the financial year:

Name of the Director % increase Name of the Director % increase

Dr B Panda - N R Mohanty -

Baijayant Panda - General Shankar - Roychowdhury (Retd.)

Subhrakant Panda - Major R N Misra (Retd.) -

J K Misra 4.58 Dr S Acharya -

C R Ray 1.26 S P Mathur -

Paramita Mahapatra - S Nautiyal -

Alex Amrein - Prem Khandelwal, 3.10 CFO & CS

D Bandyopadhyay -

iii) the percentage increase in the median remuneration of

employees in the financial year: 10.58

iv) the number of permanent employees on the rolls of

Company: 2470

v) the explanation on the relationship between average

increase in remuneration and Company performance (PBT): Average increase in remuneration (in %): 10.68

Decrease in Company''s performance (in %): 37.22

vi) comparison of the remuneration of the Key Managerial

Personnel against the performance (PBT) of the Company: Average increase in remuneration (in %): 2.98

Decrease in Company''s performance (in %): 37.22

vii) variations in the market capitalisation of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year and percentage increase or decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer in case of listed Companies, and in case of unlisted companies, the variations in the net worth of the Company as at the close of the current financial year and previous financial year:

Market capitalisation as on 31.03.2015: Rs. 397.71 Crore

Market capitalisation as on 31.03.2014: Rs. 663.06 Crore

Decrease in market capitalisation: Rs. 265.35 Crore

Price earning ratio as at 31.03.2015: 33.21

Price earning ratio as at 31.03.2014: 16.95

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

Average percentile increase in the salaries of employees other than the managerial personnel: 42nd

Percentile increase in the managerial remuneration: 64th

ix) comparison of the each remuneration of the Key Managerial Personnel against the performance (PBT) of the Company:

Increase/ (Decrease)

Name of Key Remuneration Company''s Managerial Personnel (%) Performance (%)

Dr B Panda (14.68) (37.22)

Baijayant Panda (14.64) (37.22)

Subhrakant Panda (13.16) (37.22)

J K Misra 4.58 (37.22)

C R Ray 1.26 (37.22)

Prem Khandelwal 3.10 (37.22)

x) the key parameters for any variable component of remuneration availed by the Directors:

Dr B Panda, Executive Chairman, Mr Baijayant Panda, Vice Chairman and Mr Subhrakant Panda, Managing Director are paid commission subject to a maximum of 2% each per annum of the net profits of the Company computed in accordance with Section 198 of the Companies Act, 2013.

Mr J K Misra, Director(Corporate) & COO and Mr C R Ray, Whole-time Director are paid performance pay subject to a maximum of 100% and 20% of total salary per annum (Totpa3) respectively.

All Non-Executive Independent Directors are paid commission not exceeding 0.5% per annum of the net profits of the Company subject to a maximum of Rs. 35,00,000/- distributed equally.

xi) the ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year: None.

xii) The Nomination and Remuneration Committee of the Company has affirmed that the remuneration is as per the Nomination and Remuneration Policy of the Company.

PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with the Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the names and other particulars of the employees are set out in the Annexure-5 to the Directors'' Report.

AWARDS & RECOGNITIONS

During the year under review your Company has been awarded:

(i) Star Performer in the Product Group Ferro Alloys in the Large Enterprise Category for its outstanding contribution to engineering exports (for 2012-13) organised by EEPC India, Eastern Region, Kolkata.

(ii) National Safety Award Mines (Runner Up) in the category of "Lowest Injury Frequency Rate Per Lakh Manshift (Metal Mines Belowground)" organised by the DGMS under Ministry of Labour & Employment, Govt. of India.

PUBLIC DEPOSITS

The Company has not accepted any public deposits during the year under review.

WHISTLE BLOWER POLICY

The Company has formulated a Whistle Blower Policy for Directors and employees to report their genuine concerns, details of which have been given in the Corporate Governance Report annexed to this Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr J K Misra, Mrs Paramita Mahapatra, Directors retire by rotation at the forthcoming Annual General Meeting of the Company and are eligible for re-appointment.

In terms of Section 149 and other applicable provisions of Companies Act, 2013 and Clause 49 of the Listing Agreement, Mr D Bandyopadhyay, Mr N R Mohanty, Major R N Misra (Retd.) and Dr S Acharya, Non-Executive Independent Directors are proposed to be appointed as Independent Directors up to the conclusion of 54th the Annual General Meeting. The Company has received a notice from a member pursuant to Section 160 of the Companies Act, 2013 signifying intention to propose them for the office of Independent Director under Section 149 of the Companies Act, 2013.

Mr Santosh Nautiyal was appointed as an Additional Director in the capacity of Independent Director with effect from 28th August, 2014 and holds office upto the forthcoming Annual General Meeting of the Company. The Company has received a notice from a member pursuant to Section 160 of the Companies Act, 2013 stating intent to propose him for the office of Independent Director under Section 149 of the Companies Act, 2013.

During the year Mr Prem Khandelwal has been re-designated as Chief Financial Officer & Company Secretary of the Company with effect from 20th May, 2014.

Resolutions seeking approval of the members have been incorporated in the notice of the forthcoming Annual General Meeting. Brief resume/details relating to Directors who are to be appointed/re-appointed are furnished in the Explanatory Statement to the Notice of the ensuing Annual General Meeting as required under the Code of Corporate Governance.

DISCLOSURE PURSUANT TO CLAUSE 5A OF LISTING AGREEMENT

Pursuant to Clause 5A of the Listing Agreement details in respect of the shares lying in the Indian Metals & Ferro Alloys Limited -

Unclaimed Suspense Account (Promoter group & Non-promoter group) till 31st March, 2015 are as under:

Sl Description No. of No. of No. shareholders shares

i Aggregate number of shareholders and 7,080 1,09,694 the outstanding shares in the unclaimedsuspense account lying as on 1st April, 2014

ii Number of shareholders who approached 34 533 the Company for transfer of shares from unclaimed suspense account during the year 2014-15

iii Number of shareholders to whom shares 34 533 were transferred from unclaimed suspense account during the year 2014-2015

iv Aggregate number of shareholders and 7,046 1,09,161 the outstanding shares in the unclaimed suspense account lying as on 31st March, 2015

All the corporate benefits in terms of securities accruing to on these unclaimed shares shall be credited to the aforesaid account. Voting rights on these shares shall remain frozen till the rightful owner of such shares claims the shares.

SECRETARIAL AUDIT REPORT

The Company has appointed M/s Sunita Mohanty & Associates, Company Secretaries to conduct secretarial audit and their Report on Company''s Secretarial Audit is appended to this Report as Annexure-6.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, a report on the Corporate Governance, Management Discussion and Analysis, Certificate from Practicing Company Secretary regarding compliance of conditions of Corporate Governance and CEO & CFO certification have been made a part of the Annual Report.

INDUSTRIAL RELATIONS

During the year under review, industrial relations at the Company''s manufacturing complexes situated at Therubali and Choudwar as

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the exemplary service rendered by the entire workforce during the year under review. Further, your Directors would also like to appreciate the support received from Term Lenders and Working Capital Bankers. Last but certainly by no means least, your Directors would like to thank shareholders, customers and the public at large for their continued support and confidence.

For and on behalf of the Board



(Subhrakant Panda) (Jayant Kumar Misra) Managing Director Director (Corporate) & COO

Place: Bhubaneswar Date: 14th May, 2015


Mar 31, 2013

To The Members

The Directors are pleased to present the 51st Annual Report together with Audited Statement of Accounts of the Company for the financial year ended 31st March 2013.

Financial Results Rs. in Crores

FY 2012-13 FY 2011-12

1. Revenue from operations 1,273.25 1,192.54

2. Other Income 7.76 5.64

Total Revenue 1,281.01 1,198.18

3. Profit before interest, depreciation, taxation, prior period 282.15 234.65 income and exceptional items

4. Interest 87.47 83.20

5. Depreciation 81.69 55.18

6. Prior period income 2.28 0.02

7. Exceptional items - Expense 11.99 -

8. Profit before Tax 103.28 96.29

9. Tax including Deferred Tax 49.39 32.36

10. Profit after Tax 53.89 63.93

11. Balance brought forward from previous year 361.48 319.05

12. Amount available for appropriation 415.37 382.98

13. Proposed dividend (including Tax on dividend) 15.20 15.10

14. Transfer to General Reserve 5.39 6.40

15. Balance carried forward 394.78 361.48

Your Company achieved a record turnover of Rs. 1,273.25 Crores (previous year: Rs. 1,192.54 Crores) representing an increase of 7% over the previous year. Although there is an increase of 21% in profit before interest, depreciation, exceptional items and tax amounting to Rs. 284.43 Crores (previous year: Rs. 234.67 Crores), profit after tax declined by 16% to Rs. 53.89 Crores (previous year: Rs. 63.93 Crores) mainly on account of increase in depreciation and deferred tax due to capitalisation of one unit of 2x60 MW power plant.

Dividend

Your Board of Directors is pleased to recommend for approval of the members a dividend of 50% (Rs. 5/- per share) on the equity shares of the Company for the FY 2012-13.

Operations Ferro Alloys

The production of ferro chrome during the year under review decreased by 11% to 1,74,348 tonnes (previous year: 1,96,160 tonnes) on account of non-availability of lumpy ore from one of the Company''s captive mines and temporary shutdown of one furnace at Choudwar for relining. In view of the increase in prices of ferro silicon during the year under review the Company carried out a short production run of 4970 tonnes to utilise/encash raw material available in stock.

Electricity

During the year under review your Company generated 792 million units of electricity (previous year: 777 mu''s) which translates to a plant load factor of 76.07% (108 MW) & 56.27% (30 MW) on MER basis and sold 26.13 mu''s to Gridco at an average rate of Rs. 2.75 per unit. Generation remained mainly restricted to captive requirement on account of the low rates offered by Gridco.

Mining

The chrome ore produced during the year under review decreased by 20% to 3,90,649 tonnes as compared to 4,89,667 tonnes during the previous year due to non- operation of one of the captive mines for nine months. However, mining activities have since restarted pursuant to an order of Hon''ble Orissa High Court as an interim relief although the State Government is yet to give permission for dispatch of ore. It is pertinent to note here that your Company has consistently followed in letter and spirit the practice of value addition thus maximising both employment and contribution to the exchequer.

Keeping in mind the importance of raw material security particularly in view of plans to further expand smelting capacity, your Directors will pursue the allotment of balance 50% requirement of captive chrome ore and shall take all necessary steps to protect your Company''s interests.

Listing

The equity shares of your Company are listed on Bombay Stock Exchange Limited (stock code: 533047) and National Stock Exchange of India Ltd (stock symbol: IMFA). The Annual Listing Fee for the FY 2013-14 has been paid.

Awards & Recognitions

During the year under review your Company has been awarded:

(i) "Pollution Control Appreciation Award" for adoption of effective pollution control measures and sound environmental practices for the year 2012 from State Pollution Control Board, Odisha.

(ii) "National Safety Award (Mines)" for the year 2009 in the category of "Longest Accident Free Period - Metal Mines - Below Ground" for its Nuasahi Chromite Mines.

Energy Conservation, etc.

The information required under section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in an annexure hereto forming part of this report.

Subsidiary/Joint Venture Companies

Indian Metals & Carbide Ltd, a subsidiary of your Company, has reported a loss of Rs. 3.80 lakhs during FY 2012-13 as against a loss of Rs. 79.26 lakhs during the previous year. In view of loss, the Board of Directors of the said Company have not proposed any dividend.

Utkal Green Energy Limited, a wholly owned subsidiary of your Company has no operations during the year under review.

All the formalities regarding voluntary winding up of Indmet Mauritius limited have been completed under the Law of Mauritius including no objection from all the regulatory authorities and the swearing in of the affidavit by the official liquidator for the same at Supreme Court was made on 30th January 2013. Consequently all the shares of Indmet Mining (Pte) Ltd held by Indmet Mauritius Ltd have been transferred to the Company at par value during the year. Accordingly Indmet Mining (Pte) Ltd (earlier 100% step down subsidiary) has become wholly owned subsidiary of the Company.

Utkal Power Ltd, Utkal Coal Ltd, Indmet Mining (Pte) Ltd, Singapore and Pt. Sumber Rahayu Indah (SRI), Indonesia, all subsidiaries of your Company, are yet to begin operations.

During the year under review, IMFA Alloys Finlease Limited (IAFL), the erstwhile wholly-owned subsidiary of your Company, received the Certificate of Registration from Reserve Bank of India for carrying out non-banking financial institution activities. Your Company has sold its 30 MVA furnace and other related assets including the plant & machinery related to Briquetting Plant and Gas Cleaning Plant (''''transferred assets") to IAFL following which the said transferred assets were leased back to your Company for their entire economic life pursuant to a finance lease. In accordance with the terms of a JV & Shareholders Agreement between your Company and Posco, IAFL issued and allotted equity shares amounting to 24% of its paid-up share capital to Posco with the balance 76% being owned by your Company. IAFL has reported a profit of Rs. 0.21 Crores during the FY 2012-13 and, in view of inadequate profits, the Board has not proposed any dividend.

The statement as required under Section 212 of the Companies Act, 1956 in respect of the subsidiaries of the Company is annexed and forms an integral part of this Report. The consolidated financial statements of the Company and its subsidiary Companies, prepared in accordance with Accounting Standard (AS)-21 "Consolidated Financial Statements" prescribed by the Institute of Chartered Accountants of India, form part of the Annual Report and Accounts.

In terms of the general exemption granted by the Central Government under Section 212 (8) of the Companies Act, 1956 the Audited Balance Sheets as at 31st March 2013 in respect of the subsidiaries of the Company have not been attached to the Balance Sheet of the Company. However, the requisite information for each subsidiary has been disclosed and the annual accounts of the subsidiary Companies and the related detailed information will be made available to the investors of the Company/ subsidiary Companies seeking such information at any point of time. The Annual Accounts of the subsidiary Companies will also be kept for inspection by any investor in your Company''s Registered Office and that of the subsidiary company concerned.

New Projects

Your Directors are pleased to inform that Unit 1 (60 MW) of the 2x60 MW Captive Power Plant was synchronised on 31st December 2012 and put to use. The commissioning activities of Unit 2 (60 MW) are under progress and it is likely to be synchronised and put to use shortly.

The captive coal mine project being taken up by Utkal Coal Ltd, an SPV, is at an advanced stage with all statutory approvals being in place. Other activities like displacement of affected people and various approvals for constructing captive railway siding to evacuate coal are underway. UCL is awaiting Grant Order from the Government of Odisha which has been unduly delayed. As such, your Directors are hopeful that remaining formalities will be completed shortly and the mining lease will be executed within the current calendar year with operations commencing shortly thereafter.

Particulars of Employees

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

Public Deposits

The Company has not accepted any public deposits during the year under review.

Observations of the Auditors

Observations of the Auditors on the annual accounts of the Company have been dealt with in the Notes to the Accounts annexed as Note which are self-explanatory.

Directorate

Mr N R Mohanty, Mrs Paramita Mahapatra and Major R N Misra, Directors, retire by rotation at the forthcoming Annual General Meeting of the Company and are eligible for re-appointment.

Mr C R Ray was inducted as an Additional Director of the Company with effect from 31st January 2013 by the Board of Directors in the meeting held on 16th October 2012 and subsequently appointed as Whole-time Director of the Company. As such, he will hold office up to the date of forthcoming Annual General Meeting of the Company. The Company has received a notice from a member pursuant to Section 257 of the Companies Act, 1956 signifying intention to propose him for the office of Director. Resolutions seeking approval of the members have been incorporated in the notice of the forthcoming Annual General Meeting.

Brief resume/details relating to Directors who are to be appointed/re-appointed are furnished in the Explanatory Statement to the Notice of the ensuing Annual General Meeting as required under the Code of Corporate Governance.

Disclosure pursuant to Clause 5A of Listing Agreement

Pursuant to insertion of clause 5A in listing Agreement the details in respect of the shares lying in the Indian Metals & Ferro Alloys Limited - Unclaimed Suspense Account (Promoter group & Non-promoter group) till 31st March 2013 are as under.

Sl. No. Description No. of shareholders No. of shares

(i) Aggregate number of shareholders and the outstanding 7,141 1,10,480 shares in the unclaimed suspense account lying as on 1st April 2012

(ii) Number of shareholders who approached the Company for 39 432 transfer of shares from unclaimed suspense account during the FY 2012-13

(iii) Number of shareholders to whom shares were transferred 39 432 from unclaimed suspense account during the FY 2012-2013

(iv) Aggregate number of shareholders and the outstanding 7,102 1,10,048 shares in the unclaimed suspense account lying as on 31st March 2013

All the corporate benefits in terms of securities, accruing to on these unclaimed shares shall be credited to the aforesaid account. Voting rights on these shares shall remain frozen till the rightful owner of such shares claims the shares.

Directors'' Responsibility Statement

Pursuant to provisions under section 217(2AA) of the Companies Act, 1956, your Directors hereby confirm:

(i) that in the preparation of the annual accounts for the financial year ended 31st March 2013, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(ii) that they have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 for the year under consideration;

(iii) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

(iv) that they have prepared the annual accounts of the Company for the financial year ended 31st March 2013 on a going concern basis.

Auditors

M/s Raghu Nath Rai & Co, Chartered Accountants, the existing Auditors, have given their no objection to change of Auditors by way of rotation which is in consonance with good Corporate Governance and, as such, will retire at the ensuing Annual General Meeting. Based on the recommendation of the Audit Committee, the Board of Directors of the Company have proposed the appointment of M/s. Haribhakti & Co, Chartered Accountants, as the Auditors of the Company at the ensuing AGM. M/s Haribhakti & Co, have expressed their willingness to act as Auditors of the Company, if appointed, and have further confirmed that the said appointment would be in conformity with the provisions of Section 224 (1B) of the Companies Act, 1956.

Cost Auditors

The Board of Directors of the Company appointed M/s S C Mohanty & Associates, Cost Accountants, as the Cost Auditor of the Comapny for the financial year ended 31st March 2013. The Audit Report of the cost accounts of the Company for the year ended 31st March 2013 will be submitted to the Central Government within the prescribed time limit.

In terms of the circulars issued by Ministry of Corporate Affairs, the last date for filing the Cost Audit Report for the year ended 31st March 2012 with the Central Government was 28th February 2013. The Report was filed on 31st January 2013.

Corporate Governance

Pursuant to Clause 49 of the Listing Agreement, a report on the Corporate Governance, Management Discussion and Analysis, Auditors'' Certificate regarding compliance of conditions of Corporate Governance and CEO & CFO certification have been made a part of the Annual Report.

Industrial Relations

During the year under review, industrial relations at the Company''s manufacturing complexes situated at Therubali and Choudwar as well as at the Mines remained cordial.

Acknowledgement

Your Directors would like to place on record their sincere appreciation of the devoted services rendered by the entire workforce during the year under review. Further, your Directors would also like to appreciate the support received from Term Lenders and Working Capital Bankers. Last but certainly by no means least, your Directors would like to thank shareholders, customers and the public at large for their continued support and confidence.

For and on behalf of the Board

Baijayant Panda Subhrakant Panda

vice Chairman Managing Director

Place: New Delhi

Date: 15th May 2013


Mar 31, 2012

The Directors are pleased to present the 50th Annual Report together with Audited Statement of Accounts of the Company for the financial year ended 31st March 2012.

FINANCIAL RESULTS

(Rs in Crores) 2011-12 2010-11

1. Revenue from operations 1192.54 1068.04

2. Other Income 5.66 10.00

Total Revenue 1198.20 1078.04

3. Profit before interest, depreciation and taxation 234.67 349.61

4. Interest 83.20 54.10

5. Depreciation 55.18 41.85

6. Profit before Tax 96.29 253.66

7. Tax including Deferred Tax 32.36 88.22

8. Profit after Tax 63.93 165.44

9. Balance brought forward from previous year 319.05 200.81

10.Amount available for appropriation 382.98 366.25

11.Interim Dividend (including tax on dividend) Nil 15.35

12.Proposed dividend (including Tax on dividend) 15.10 15.30

13.Transfer to General Reserve 6.40 16.55

14.Balance carried forward 361.48 319.05

Your Company recorded the highest ever revenues of Rs 1192.54 crores (previous year : Rs 1068.04 crores) representing an increase of 12% which is creditable in what was a difficult year. However, due to non-availability of linkage coal, steep hike in the price of coal procured through e-auction / open market purchase and increase in the cost of reductants, the profit before interest, depreciation and taxes declined by 33% to Rs 234.67 crores (previous year : Rs 349.61 crores) while profit after tax declined by 61% to Rs 63.93 crores (previous year : Rs 165.44 crores).

DIVIDEND

Your Board of Directors is pleased to recommend for approval of the members a dividend of 50% (Rs 5/- per share) on the equity shares of the Company for the financial year 2011-12.

OPERATIONS

Ferro Alloys

The production of ferrochrome during the year under review touched an all time high of 196,160 tonnes representing a 9% increase over the 179,850 tonnes produced in the previous year.

Electricity

During the year under review your Company generated 777 million units (mu's) of electricity (previous year : 774 mu's) which translates to a plant load factor of 82.84% on MER basis and sold 3.39 mu's to Gridco at an average rate of Rs 2.35 per unit. Generation remained restricted both on account of difficulty in sourcing coal as well as the low rates offered by Gridco.

Mining

The total quantum of chrome ore raised from your Company's mines for captive use amounted to 489,667 tonnes during the year under review (previous year : 427,973 tonnes) which was an increase of 14%. It is pertinent to note here that your Company has consistently followed in letter and spirit the practice of value addition thus maximising both employment and contribution to the exchequer.

Pursuant to a communication from the District Collector, mining activity at one of the captive chrome ore mines operated by the Company has been kept in abeyance w.e.f 17th February 2012 and all necessary steps are being taken to restart operations as soon as possible.

Keeping in mind the importance of raw material security particularly in view of plans to further expand smelting capacity, your Directors will pursue the allotment of balance 50% area and shall take all necessary steps to protect your Company's interests.

LISTING

The equity shares of your Company are listed on Bombay Stock Exchange Limited (stock code : 533047) and National Stock Exchange of India Ltd (stock symbol : IMFA). The Annual Listing Fee for the year 2012-13 has been paid.

AWARDS & RECOGNITIONS

Your Company has been awarded the prestigious 'Star Performer: Large Enterprise' in the Ferro Alloys product group by EEPC India Eastern Region for its outstanding performance during the year 2009-10 & 2010-11.

ENERGY CONSERVATION, ETC.

The information required under section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in an annexure hereto forming part of this report.

SUBSIDIARY COMPANIES

Indian Metals & Carbide Ltd, a subsidiary of your Company, has reported a loss of Rs 79.26 lakhs during 2011-12 as against a profit of Rs 0.17 lakh during the previous year. During the year under review, an undertaking comprising of the lease land of 5 acres along with buildings & structures standing thereon besides other materials and assets situated at Mouza: Dhepaguda, Tahsil: Rayagada along with all their respective assets & liabilities have been transferred to the Company on a going concern basis. In view of the loss, the Board of Directors of the said Company have not proposed any dividend.

Utkal Green Energy Limited, a subsidiary of your Company which started its operation during the year under review, has transferred its undertaking comprising of (a) a completed Fly Ash Brick Plant; (b) a Fly Ash Brick Plant under construction; (c) a Light Weight Aggregate Plant under construction together with their respective assets & liabilities on a going concern basis to the Company.

During the year under review your Directors have approved the proposal to wind up its wholly owned subsidiary Indmet (Mauritius) Limited and winding up formalities are being complied with as required under the laws of Mauritius. The final notice of dissolution of the said Company in the Government Gazette is awaited.

Your Company has acquired 70% stake in an Indonesian coal mine Pt Sumber Rahayu Indah through its step-down subsidiary incorporated in Singapore. It is not possible to quantify the total reserves and estimated amount of investment at the moment as detailed assessment is yet to be carried out in this regard.

Utkal Power Ltd, Utkal Coal Ltd, IMFA Alloys Finlease Ltd, Indmet Mining Pte Ltd, Singapore and Pt Sumber Rahayu Indah (SRI), Indonesia, all subsidiaries of your Company, are yet to begin operations.

The statement as required under Section 212 of the Companies Act, 1956 in respect of the subsidiaries of the Company is annexed and forms an integral part of this Report. The consolidated financial statements of the Company and its subsidiary companies, prepared in accordance with Accounting Standard (AS)-21 "Consolidated Financial Statements" prescribed by the Institute of Chartered Accountants of India, form part of the Annual Report and Accounts.

In terms of the general exemption granted by the Central Government under Section 212 (8) of the Companies Act, 1956 the Audited Balance Sheets as at 31st March 2012 in respect of the subsidiaries of the Company have not been attached to the Balance Sheet of the Company. However, the requisite information for each subsidiary has been disclosed and the annual accounts of the subsidiary companies and the related detailed information will be made available to the investors of the Company/subsidiary companies seeking such information at any point of time. The Annual Accounts of the subsidiary companies will also be kept for inspection by any investor in your Company's Registered Office and that of the subsidiary company concerned.

NEW PROJECTS

Your Directors are pleased to inform that the 30 MW dual fuel power plant was commissioned in August 2011 and is in operation. However, several shortcomings / defects have been noticed which need to be rectified in order to achieve design parameters including operating at full load. Since the EPC Contractor could not attend to the same in a timely manner despite ample opportunity being given in this regard, your Company has taken over the project and is doing the needful at the risk and cost of the EPC Contractor.

The commissioning of the 2 x 60 MW Captive Power Plant has got delayed primarily on account of the delay in completion of the coal & ash handling system. However, construction and pre-commissioning activities in certain areas are on in full swing and the unit is expected to be commissioned in September 2012.

The captive coal mine project being taken up by Utkal Coal Ltd, an SPV in which your Company has a 74% stake, is at an advanced stage with all statutory approvals being in place. Other activities like displacement of affected people and acquisition of land for railway siding to evacuate coal is also underway. As such, your Directors are hopeful that the mining lease will be executed shortly and operations will commence within the current calendar year.

PARTICULARS OF EMPLOYEES

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

PUBLIC DEPOSITS

The Company has not accepted any public deposits during the year under review.

OBSERVATIONS OF THE AUDITORS

Observations of the Auditors on the annual accounts of the Company have been dealt with in the Notes to the Accounts annexed as Note '26' which are self-explanatory.

DIRECTORATE

Mr G L Tandon, Mr D Bandyopadhyay, Mr J K Misra and Prof S Acharya, Directors, retire by rotation at the forthcoming Annual General Meeting of the Company and are eligible for re-appointment.

However, Mr G L Tandon has expressed his intention not to seek re-appointment on health grounds. The Members of the Board and the Management place on record their deep appreciation of the services rendered by Mr Tandon during his tenure as Member of the Board and wish him all the best. Further, the Board and the Management also convey their gratitude to Mr S K Pattanaik who served as an alternate to Mr Alex Amrein from 16th July 2011 till 23th November 2011.

The proposals regarding the re-appointment of Mr Bandyopadhyay, Mr Misra and Prof Acharya as Directors are placed for your approval along with brief resumé / details which are furnished in the Explanatory Statement to Notice for the ensuing Annual General Meeting as required under the Code of Corporate Governance.

DISCLOSURE PURSUANT TO CLAUSE 5A OF LISTING AGREEMENT

Pursuant to insertion of clause 5A in listing Agreement the details in respect of the shares lying in the Indian Metals & Ferro Alloys Limited - Unclaimed Suspense Account (Promoter Group & Non-promoter Group) till 31st March 2012 are as under.

Sl. No. of No. of No. Description shareholders shares

i) Aggregate number of shareholders and 0 0 the outstanding shares in the unclaimed suspense account lying as on 1st April 2011

ii) Number of shareholders who approached the Company for 6 37 transfer of shares from unclaimed suspense account during the year 2011-12

iii) Number of shareholders to whom shares were transferred from 6 37 unclaimed suspense account during the year 2011-2012

iv) Aggregate number of shareholders and the outstanding shares in the 7141 110480 unclaimed suspense account lying as on 31st March 2012

All the corporate benefits in terms of securities, accruing to on these unclaimed shares shall be credited to the aforesaid account. Voting rights on these shares shall remain frozen till the rightful owner of such shares claims the shares.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to provisions under section 217(2AA) of the Companies Act, 1956, your Directors hereby confirm:

(i) that in the preparation of the annual accounts for the financial year ended 31st March 2012, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(ii) that they had selected such accounting policies and applied them consistently and made judgments and estimates that were 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 for the year under consideration;

(iii) that they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

(iv) that they had prepared the annual accounts of the Company for the financial year ended 31st March 2012 on a going concern basis.

AUDITORS

M/s Raghu Nath Rai & Co, Chartered Accountants, the Auditors of the Company who are to retire at the ensuing Annual General Meeting, being eligible offer themselves for re-appointment. The Company has received a certificate to the effect that their re-appointment, if made, shall be within the limits prescribed u/s 224 (1B) of the Companies Act, 1956.

COST AUDITORS

Pursuant to provisions of Section 233B of the Companies Act,1956 and with prior approval of Central Government M/s S.C Mohanty & Associates, Cost Accountants, were appointed to conduct audit of cost records of the Company for the year ended 31st March 2012. Cost Audit Reports would be submitted to the Central Government within prescribed time.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, a report on the Corporate Governance, a Management Discussion and Analysis, Auditors' Certificate regarding compliance of conditions of Corporate Governance and CEO & CFO certification have been made a part of the Annual Report.

INDUSTRIAL RELATIONS

During the year under review, industrial relations at the Company's plants situated at Therubali and Choudwar as well as at the Mines remained cordial.

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the devoted services rendered by the entire workforce during the year under review. Further, your Directors also appreciate the support received from Term Lenders and Working Capital Bankers. Last but certainly by no means least, your Directors would like to thank shareholders, customers and the public at large for their continued support and confidence.

For and on behalf of the Board

Place: New Delhi Baijayant Panda Subhrakant Panda

Date : 5th May 2012 Vice Chairman Managing Director


Mar 31, 2011

The Directors are pleased to present the 49th Annual Report together with Audited Statement of Accounts of the Company for the financial year ended 31st March 2011

FINANCIAL RESULTS

(Rs in Crore)

2010-11 2009-10

1. Gross sales: 1052.15 601.23

Less : Excise Duty 11.67 8.64

Net Sales 1040.48 592.59

2. Other Income 37.56 29.63

Total Revenue 1078.04 622.22

3. Profit before interest depreciation and taxation 349.61 142.27

4. Interest 54.10 44.39

5. Depreciation 41.85 40.39

6. Profit before Tax 253.66 57.49

7. Tax including Deferred Tax 88.22 16.48

8. Profit after Tax 165.44 41.01

9. Balance brought forward from previous year 200.81 179.30

10. Amount available for appropriation 366.25 220.31

11. Interim Dividend (including Tax on dividend) 15.35 -

12. Proposed dividend (including Tax on dividend) 15.30 15.40

13. Transfer to General Reserve 16.55 4.10

14. Balance carried forward 319.05 200.81

The revival in demand for commodities helped your Company post gross sales of Rs 1052.15 crores during the year under review representing a 75% increase (previous year : Rs 601.23 crores) while profit before nterest depreciation & taxes increased by 146% to Rs 349.61 crores (previous year : Rs 142.27 crores) and profit after tax increased by 303% to Rs 165.44 crores (previous year : Rs 41.01 crores)

DIVIDEND

Your Company had paid an interim dividend of 50% (Rs 5/- per share) in November 2010 and the Board of Directors is pleased to recommend a final dividend of 50% (Rs 5/- per share) taking the aggregate dividend to 100% (Rs 10/- per share).

OPERATIONS

Ferro Alloys :

The production of ferro chrome during the year under review increased by 38% to 179,850 tonnes (previous year : 130,758 tonnes) in line with the improvement in demand and consequent to the commissioning of the sixth furnace (30 MVA). However, production of ferro silicon remained suspended even as your Company evaluates the capital expenditure required in order to start producing ferro chrome in the furnace which is currently shut-down.

Electricity :

During the year under review your Company generated 774 million units of electricity (previous year : 726 mus) which translates to a plant load factor of 88.35% on MER basis and sold 47.47 mus to Gridco at an average rate of Rs 3.15 per unit.

Mining :

The total quantum of chrome ore raised from your Companys mines for captive use amounted to 427,973 tonnes during the year under review (previous year : 282,836 tonnes) which was an increase of 51%. It is pertinent to note here that your Company has consistently followed in letter and spirit the practice of value addition thus maximising both employment and contribution to the exchequer.

Keeping in mind the importance of raw material security particularly in view of plans to further expand smelting capacity, your Directors will pursue the allotment of balance 50% area and shall take all necessary steps to protect your Companys interests.

LISTING

The equity shares of your Company are listed on Bombay Stock Exchange Limited (stock code : 533047) and the Annual Listing Fee for the year 2011-12 has been paid.

Your Companys shares have also been listed on National Stock

Exchange of India Ltd (stock symbol : IMFA) and trading commenced w.e.f. 23rd July 2010. Annual Listing Fee for the year 2011-12 has been paid.

REDUCTION OF SHARE CAPITAL

Pursuant to the Composite Scheme of Arrangement & Amalgamation 864,902 shares were allotted to Erstwhile ICCL Shareholders Trust and made available by the Trustees at Rs 50/- per share to small shareholders. However, despite several extensions / reminders, only 515,436 shares were subscribed with the balance 349,466 shares remaining unsubscribed. The Company filed a petition before the Honble Orissa High Court under Section 392 of the Companies Act, 1956 seeking approval to modify the Scheme of Arrangement & Amalgamation and confirming the reduction of share capital by way of cancelling 349,466 equity shares of Rs 10/- each held by Erstwhile ICCL Shareholders Trust. The petition was approved by the Honble High Court of Orissa vide its order dated 16th March 2011 and registered with the Registrar of Companies (ROC), Orissa on 01st April 2011. Accordingly the paid up equity share capital stands reduced from Rs 26,32,65,190/- (Rupees twenty six crore thirty two lakhs sixty five thousand one hundred ninety only) divided into 2,63,26,519 equity shares of Rs 10/- each to Rs 25,97,70,530/- (Rupees twenty five crore ninety seven lakhs seventy thousand five hundred thirty only) divided into 2,59,77,053 equity shares of Rs 10/- each with effect from 01st April, 2011. Several shareholders have subsequently challenged the reduction of share capital before a Division Bench of the Honble Orissa High Court and the matter has been reserved for judgement.

JOINT VENTURE WITH POSCO

Your Company has signed a Joint Venture (JV) Agreement with POSCO on 18th January 2011 wherein the newly commissioned 30 MVA furnace will be transferred to the JV Company and then leased back to IMFA for operating and supplying the entire production of ferro chrome to POSCO. In addition, POSCO will also purchase 50,000 tonnes per annum of ferro chrome from the Company under a long term supply agreement valid for five years and renewable by mutual consent thereafter.

AWARDS & RECOGNITIONS

Your Company has been awarded the prestigious Top Exporter from Eastern Region for the year 2008-09 (Silver Trophy) in the Large Enterprise Category by EEPC India for its outstanding export performance during the year 2008-09.

Your Company has also been awarded the prestigious FIEO Niryat Shree Award for the year 2008-09.

ENERGY CONSERVATION, ETC.

The information required under section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in an annexure hereto forming part of this report.

SUBSIDIARY COMPANIES

Indian Metals & Carbide Ltd, a subsidiary of your Company, has reported a profit of Rs 17,012/- during 2010-11 as against a net loss of Rs 1.24 lakhs during the previous year. In view of inadequate profit, the Board of Directors of the said Company have not proposed any dividend.

Utkal Power Ltd, Utkal Coal Ltd, IMFA Alloys Ltd, Indmet (Mauritius) Ltd, Indmet Mining Pte. Ltd, Singapore and Utkal Green Energy Ltd, all subsidiaries of your Company, are yet to begin operations. Hence, no Profit & Loss Account has been prepared for any of these entities.

The statement as required under Section 212 of the Companies Act, 1956 in respect of the subsidiaries of the Company is annexed and forms an integral part of this Report. The consolidated financial statements of the Company and its subsidiary companies, prepared in accordance with Accounting Standard (AS)-21 "Consolidated Financial Statements" prescribed by the Institute of Chartered Accountants of India, form part of the Annual Report and Accounts.

In terms of the general exemption granted by the Central Government under Section 212 (8) of the Companies Act, 1956 the Audited Balance Sheets as at 31st March 2011 in respect of the subsidiaries of the Company have not been attached to the Balance Sheet of the Company. However, the requisite information for each subsidiary has been disclosed and the annual accounts of the subsidiary companies and the related detailed information will be made available to the investors of the Company/subsidiary companies seeking such information at any point of time. The Annual Accounts of the subsidiary companies will also be kept for inspection by any investor in your Companys Registered Office and that of the subsidiary company concerned.

NEW PROJECTS

Completion of the 30 MW dual fuel power plant has got inordinately delayed due to a variety of reasons and is a matter of great concern. However, the primary focus now is to commission the unit expeditiously and start generating electricity. All necessary steps are being taken in this direction and your Directors are hopeful that the unit will be commissioned by June 2011.

Meanwhile, construction activities pertaining to the 2 x 60 MW Captive Power Plant is going on in full swing and the progress till date is satisfactory. As such, the project is on track to be completed by the last quarter of the current financial year.

Finally, the captive coal mine project being taken up by Utkal Coal Ltd, an SPV in which your Company has a 74% stake, is at an advanced stage with all statutory approvals except forest clearance being in place. Stage I clearance has already been received and considerable progress has been made towards getting Stage II clearance which is expected shortly. Other activities like displacement of affected people and acquisition of land for captive railway siding to evacuate coal is also underway. As such, your Directors are hopeful that the mining lease will be executed within the calendar year and operations will commence shortly thereafter.

PARTICULARS OF EMPLOYEES

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

PUBLIC DEPOSITS

The Company has not accepted any public deposits during the year under review. However, unclaimed deposits pending repayment amounting to Rs 0.02 crore was paid during the year under review.

OBSERVATIONS OF THE AUDITORS

Observations of the Auditors on the annual accounts of the Company have been dealt with in the Notes to the Accounts annexed as Schedule N which are self-explanatory.

DIRECTORATE

Mr Alex Amrein, Mr S P Mathur and General Shankar Roychowdhury, Directors, retire by rotation at the forthcoming Annual General Meeting of the Company and are eligible for re-appointment. The proposals regarding their re-appointment as Directors are placed for your approval. Mr S K Pattanaik, was appointed as Alternate Director to Mr Alex Amrein w.e.f 21st July 2010 till 23rd January 2011. The Directors convey their gratitude to Mr Pattanaik for his invaluable contribution during his tenure.

Brief resume/details relating to Directors who are to be re-appointed are furnished in the Explanatory Statement to the Notice of the ensuing Annual General Meeting as required under the Code of Corporate Governance.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to provisions under section 217(2AA) of the Companies Act, 1956, your Directors hereby confirm:

(i) that in the preparation of the annual accounts for the financial year ended 31st March, 2011, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(ii) that they have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 for the year under consideration;

(iii) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

(iv) that they have prepared the annual accounts of the Company for the financial year ended 31st March, 2011 on a going concern basis.

AUDITORS

M/s Raghu Nath Rai & Co, Chartered Accountants, the Auditors of the Company who are to retire at the ensuing Annual General Meeting, being eligible offer themselves for re-appointment. The Company has received a certificate to the effect that their re-appointment, if made, shall be within the limits prescribed u/s 224 (1B) of the Companies Act, 1956.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, a report on the Corporate Governance, Management Discussion and Analysis, Auditors Certificate regarding compliance of conditions of Corporate Governance and CEO & CFO certification have been made a part of the Annual Report.

INDUSTRIAL RELATIONS

During the year under review, industrial relations at the Companys plants situated at Therubali and Choudwar as well as at the Mines remained cordial.

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the devoted services rendered by the entire workforce during the year under review. Further, your Directors would also like to recognise and appreciate the support received from Term Lenders and Working Capital Bankers. Last but certainly by no means least, your Company would like to thank its shareholders, customers and the public at large for their continued support and confidence.

For and on behalf of the Board

Place: New Delhi Baijayant Panda Subhrakant Panda

Date : 3rd May 2011 Vice Chairman Managing Director



 
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