Home  »  Company  »  Jindal Saw  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Jindal Saw Ltd.

Mar 31, 2015

1 Terms/Rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs. 2/- per equity share. Each equity shareholder is entitled to one vote per share.

2 The Company allotted 435,30,596, 0% Compulsorily Convertible Debentures (CCDs) on preferential basis under the SEBI ICDR Regulations to the promoters group entity @ Rs. 81.10 per CCD. Out of these CCDs, 1,38,08,414 CCDs have been converted into equal number of equity shares of Rs. 2 each on 25th March, 2015. The remaining CCDs shall be converted into two trenches as follows:-

i) 1,44,98,696 number of CCDs would be converted into equal number of equity shares of Rs. 2 each any time during 1st April, 2015 to 31st March, 2016; and

ii) 1,52,23,486 number of CCDs shall be converted into equal number of equity shares of Rs. 2 each during the month of April, 2016.

3 Non convertible Debentures include :

[i] 10.75% Non Convertible Debentures of Rs. 30,000 lacs [including Rs. 10,000 lacs shown in current maturity] [Previous Year Rs. 30,000 lacs] are secured by first pari passu charge by way of English mortgage on the Company''s specific immovable properties located in the state of Gujarat and by way of equitable mortgage of Company''s other immovable properties and hypothecation of movable fixed assets both present and future in favour of Debenture Trustees. The same are repayable in three equal installments of Rs. 10,000 lacs each on 08 April, 2015, 08 April, 2016 and 08 April, 2017.

[ii] 10.50% Non Convertible Debentures of Rs. 10,000 lacs [Previous Year Rs. 10,000 lacs] in three series are secured by first pari passu charge by way of English mortgage on the Company''s specific immovable properties located in the state of Gujarat and by way of equitable mortgage of Company''s other immovable properties and hypothecation of movable fixed assets both present and future in favour of Debenture Trustees. The same are repayable in three installments of Rs. 3,000 lacs [Series I], Rs. 3,000 lacs [Series II] and Rs. 4,000 lacs [Series III] on 12 September, 2018, 12 September, 2019 and 12 September, 2020 respectively. There is a call option exercisable at the end of three years from the date of allotment [12 September, 2012] for all series of NCDs. The Call option is also available in every subsequent year for each series of NCD individually i.e. at the end of 4th, 5th, 6th and 7th year from the date of allotment upto their respective dates of maturity.

[iii] 10.38% Non Convertible Debentures of Rs. 30,000 lacs [Previous Year Rs. 30,000 lacs] in two series are secured by first pari passu charge by way of English mortgage on the Company''s specific immovable properties located in the state of Gujarat and by way of equitable mortgage of Company''s other immovable properties and hypothecation of movable fixed assets both present and future in favour of Debenture Trustees. The same are repayable in single installment of Rs. 30,000 lacs on 26 December, 2021. There is a put/call option for Rs. 15,000 lacs [Series 1] at the end of third year [26 December, 2015] and for Rs.15,000 lacs [Series 2] at the end of Fourth year [26 December, 2016] from the date of allotment i.e. 26 December, 2012.

4 Term Loans from Banks include :

[i] Term Loan of Rs. 13,700 lacs [rate of interest 1.50% p.a.][Previous Year Rs. 13,700 lacs] is secured by way of second charge on all the assets of the Company both present and future and also by way of personal guarantee of a Director. The same is repayable in three installments of Rs. 4,110 lacs, Rs.4,110 lacs and Rs. 5,480 lacs on 31 Jan, 2017, 31 Jan, 2018 and 31 Jan, 2019 respectively.

[ii] Term Loan of Rs. 5,000 lacs [rate of interest 10.75% p.a.] [Previous Year Rs. 5,000 lacs] is secured by way of second charge on all the assets of the Company, both present and future and also by way of personal guarantee of a Director. The repayment is by way of a bullet payment of Rs. 5,000 lacs on 23 May, 2017.

[iii] Term Loan of USD 89,04,719.50 [Rs. 5,573.53 lacs] [rate of interest 6 Months LIBOR 400 bps p.a.] [Previous Year USD 89,04,719.50 - Rs. 5,351.72 lacs] is secured by way of second charge on all the assets of the Company both present and future and also by way of personal guarantee of a Director. The repayment is by way of a bullet payment of USD 89,04,719.50 [Rs. 5,573.53 lacs] on 23 May, 2017.

[iv] Term Loan of Rs. 50,000 lacs [including Rs. 1,000 lacs shown in current maturity] [rate of interest 11.25% p.a.] [Previous Year Rs. 29,500 lacs] is secured/to be secured by first pari passu charge by way of equitable mortgage on Company''s immovable properties and hypothecation of movable fixed assets both present and future.

The Company allotted 435,30,596, 0% Compulsorily Convertible Debentures [CCDs] on preferential basis under the SEBI ICDR Regulations to the promoters group entity @ Rs. 81.10 per CCD. Out of these CCDs, 1,38,08,414 CCDs have been converted into equal number of equity shares of Rs. 2 each on 25th March, 2015. The remaining CCDs shall be converted into two trenches as follows :

i] 1,44,98,696 number of CCDs would be converted into equal number of equity shares of Rs. 2 each any time during 1st April, 2015 to 31st March, 2016; and

ii] 1,52,23,486 number of CCDs shall be converted into equal number of equity shares of Rs. 2 each during the month of April, 2016.

5. Terms of repayment of Unsecured ECB :

a] External Commercial Borrowings of USD 1,90,00,000 [Rs. 11,892.26 lacs] [including USD 57,00,000 Rs. 3,567.68 lacs shown in current maturity] [Previous Year USD 1,90,00,000 Rs. 11,418.96 lacs] is repayable in three installments of USD 57,00,000 [Rs. 3,567.68 lacs], USD 57,00,000 [Rs. 3,567.68 lacs] and USD 76,00,000 [Rs. 4,756.90 lacs] on 27 November, 2015, 27 November, 2016 and 27 November, 2017 respectively. Rate of Interest is 6 months USD LIBOR 2.30% p.a.

b] External Commercial Borrowing of USD 7,30,18,334 [Rs. 45,702.76 lacs] [including USD 2,40,96,050 - Rs. 15,081.91 lacs shown in current maturity] [Previous Year USD 7,30,18,334 - Rs. 43,883.87 lacs] is repayable in three installments of USD 2,40,96,050 [Rs. 15,081.91 lacs], USD 2,40,96,050 [Rs. 15,081.91 lacs] and USD 2,48,26,234 [Rs. 15,538.94 lacs] on 30 June, 2015, 30 June, 2016 and 30 June, 2017, respectively. Rate of Interest is 6 months USD LIBOR 2.55% p.a.

PARTICULARS As At As At 31st March, 31st March, 2015 2014 (Rs. in lacs) [Rs. in lacs]

6. CONTINGENT LIABILITIES

a] Guarantees issued by the Company''s 7 8,419.52 78,348.56 bankers on behalf of the Company

b] Letter of Credit Outstanding 67,589.82 51,142.53

c] Claims against the company not 81.22 81.22 acknowledged as debt

d] Corporate guarantees/ undertakings 144,058.29 138,445.59 issued to lenders of subsidiary companies

e] Disputed Excise duty, Custom Duty 264.27 212.68 and service tax

f] Income tax demands against which 893.64 2,534.68 company has preferred appeals

g] Disputed Sales Tax 585.41 585.41

h] Liability in respect of Corporate 2,415.72 4,915.03 Guarantees/Duty Saved for availing various export based incentive schemes

30. Estimated amount of contracts remaining to be executed on capital 6,800.07 22,809.66 account and not provided for [Net of Advances]

7. The Company''s manufacturing facility at Nashik has been granted "Mega Project Status" by Government of Maharashtra and therefore is eligible for Industrial Promotion Subsidy [IPS] under Packaged Scheme of Incentive [PSI] 2007.

The purpose of the Packaged Scheme of Incentive [PSI] 2007 is for intensifying and accelerating the process of dispersal of industries to the less developed regions and promoting high tech industries in the developed areas of the state coupled with the object of generating mass employment opportunities.

Modalities of payment of IPS consists of the following:

a. Electricity Duty exemption for a period of 7 years from the date of commencement of commercial production- from 10 September, 2009 to 09 September, 2016

b. 100% exemption from payment of Stamp duty.

c. VAT and CST payable to the State Government [on sales made from Nashik plant, within a period of 7 years starting from 10 September, 2009].

IPS will be payable so as to restrict up to 75% of the Eligible Fixed Capital investments made from 13 September, 2007 to 10 September, 2009 . The Eligibility Certificate issued allows maximum Fixed Capital Investment of Rs. 350 croresand restricts IPS to 75% of Rs. 350 crores i.e. Rs. 262.50 crores.

In terms of the Accounting Standard [AS 12] "Accounting for Government Grants" prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies [Accounts], Rules, 2014, eligible incentive of Rs. 1,929.57 lacs [Previous Year Rs. 1,749.96 lacs] is considered to be in the nature of promoters'' contribution and has been credited to Capital Reserve.

8. Exceptional items represents net loss on reinstatement/settlement of foreign currency monetary items other than long term foreign currency monetary items related to acquisition of depreciable assets.

9. The Company has exercised the option in financial year 2011-12 for accounting of the exchange differences arising on long term foreign currency monetary items in line with Companies (Accounting Standard (Second Amendment) Rules, 2011 dated 29th December, 2011 relating to Accounting Standard (AS-11) notified by Central Government w.e.f. 1st April, 2011. Accordingly it has capitalized the exchange difference on long term foreign currency loans related to acquisition of depreciable assets.

10. The Company''s significant leasing arrangements are in respect of operating leases for premises-residential and offices. These leasing arrangements are cancellable. The aggregate lease rentals payables are charged as rent.

11. The Company has unquoted investments of Rs. 91,107.73 lacs (Previous Year Rs. 72,260.47 lacs) and Share Application Money of Rs. 2,029.36 lacs ( Previous Year Rs. 3,949.67 lacs ) in Subsidiary Companies, which have accumulated losses as per the latest available Balance Sheet and certain other unquoted investments where the fair value (amount unascertained) is lower than the cost, considering the long term strategic investments and future prospects, such diminution, in the opinion of the management, has been considered to be of temporary nature and hence no provision for the same is considered necessary.

12. An amount of Rs. 40,594.78 lacs (Previous Year Rs. 5,403.48 lacs) is outstanding from Subsidiary companies, which have accumulated losses. Having regard to the long- term involvement and future prospects, no provision is considered necessary towards these outstandings.

13. Sundry Debtors, Creditors and other advances are subject to confirmation. The effect of the same, if any, which is not likely to be material, will be adjusted at the time of confirmation.

14. (a) The company has provided sponsor''s undertakings to lenders of the projects being sponsored by its wholly owned subsidiary namely Jindal ITF Limited. Major terms of the undertakings envisage investment/buy back of equity/instruments,retention of major equity in subsidiary company, supporting the projects for shortfall in debt servicing and in the eventuality of any cost overrun.

(b) Company has given guarantees/ indemnities for its step down subsidiary Company namely Jindal Saw Italia S.p.A (JSI) favoring supplier/lessor for (i) Inventory purchase by JSI, (ii) towards plant performance/upkeep, and (iii) employees benefits; total amounting to Rs. 2902.95 lacs ( Previous Year Rs. 8,419.42 lacs).

(c) Some of the subsidiaries of the Company have privately placed various instruments including 9.25% -Compulsorily Convertible Debentures of Rs. 8,000 lacs, 0%- Compulsorily Convertible Debentures of Rs. 8,060 lacs and Redeemable Non Convertible Debentures aggregating to Rs. 28,130 lacs all aggregating to Rs. 44,190 lacs. The subscribers of such instruments have put option to require the Company to purchase the securities at the Put Option Price within the time period as per the terms of the agreement/s which is spread over a period ending June, 2017. The estimated amount of put option of such securities as per the terms of the agreement/s is Rs. 52,354.08 lacs as on 31st March, 2015 ( previous year Rs. 64,245.19 lacs).

15. Depreciation for the year ended 31st March, 2015 has been provided for based on useful life prescribed in Schedule II of the Companies Act, 2013. During the previous year ended 31st March, 2014, the depreciation was charged at the rates prescribed under Schedule-XIV of the Companies Act, 1956. As a result, the depreciation charge for the year ended 31st March, 2015 is higher by Rs. 646.43 lacs. Also depreciation of Rs. 1071.04 lacs (net of deferred tax of Rs. 566.83 lacs) where useful life of assets is nil is adjusted against opening balance of retained earnings.

16. In the opinion of the Management, the realizable value of assets other than fixed assets and long term investments, in the ordinary course of business, would not be less than the amount at which they are stated.

17. The Company has a process whereby periodically all long term contracts (including derivative contracts) are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law/ accounting standards for material foreseeable losses on such long term contracts (including derivative contracts) has been made in the books of accounts.

18. Related Parties Transactions

List of Related Parties & Relationship

A. List of Direct Subsidiaries/ Indirect Subsidiaries/ Joint Ventures

I Direct Subsidiaries

S. No. Name of the Company

1 Jindal ITF Limited

2 IUP Jindal Metals & Alloys Limited

3 S.V. Trading Limited

4 Jindal Fittings Limited

5 Quality Iron and Steel Limited

6 Ralael Holdings Limited

7 Jindal Saw Holdings FZE

8 Greenray Holdings Limited

9 Universal Tube Accessories Private Limited

10 Jindal Saw Espana,S.L.

11 Jindal Tubular (India) Limited (w.e.f. 5th February, 2015)

12 JITF Urban Infrastructure Services Limited (indirect subsidiary upto 23rd January, 2015)

13 JITF Shipyards Limited (indirect subsidiary upto 29th January, 2015)

14 JITF Infralogistics Limited (indirect subsidiary upto 23rd January, 2015)

II Indirect Subsidiaries

1 Jindal Saw USA, LLC

2 Jindal Saw Italia S.p.A.

3 Jindal Saw Middle East FZC

4 Derwent Sand SARL

5 Jindal Saw Gulf (LLC)

6 Jindal Intellicom Limited

7 JITF Water Infrastructure Limited

8 Jindal Rail Infrastructure Limited

9 JITF Waterways Limited

10 JITF Urban Infrastructure Limited

11 JITF Coal Logistics Limited

12 Intellicom Insurance Advisors Limited

13 JITF Shipping & Logistics (Singapore) Pte. Limited

14 JITF Water Infra (Naya Raipur) Limited

15 JITF ESIPL CETP (Sitarganj) Limited

16 JITF Industrial Infrastructure Development Company Limited

17 JITF Urban Waste Management (Ferozepur) Limited

18 JITF Urban Waste Management (Jalandhar) Limited

19 JITF Urban Waste Management (Bathinda) Limited

20 Timarpur- Okhla Waste Management Company Private Limted

21 Jindal Tubular USA LLC (w.e.f. 6th May, 2014)

22 World Transload & Logistics LLC

23 5101 Boone LLP

24 Tube Technologies INC w.e.f. 22nd May, 2014

25 Helical Anchors INC

26 Boone Real Property Holding LLC

27 Drill Pipe International LLC

III Joint Ventures

1 Jindal SAW Pipeline Solutions Limited

2 JWIL-SSIL JV

3 SMC-JWIL JV

4 JWIL-RANHILL JV

5 TAPI-JWIL JV

B. List of Key Management Personnel (KMP) & person having significant influence

S.No Name

1 Mr. Prithvi Raj Jindal Chairman (Non Executive)

2 Ms. Sminu Jindal Managing Director

3 Mr. Indresh Batra Managing Director (upto 17th May, 2014)

4 Mr. Neeraj Kumar Group CEO & Whole- time Director

5 Mr. Hawa Singh Chaudhary Whole-time Director

6 Mr. O.P. Sharma Chief Operating Officer (Large Dia Pipe- SBU)

7 Dr. Dharmendra Gupta Director (Mines & Steel)

8 Mr. Dinesh Chandra Sinha President & SBU Head

9 Mr. N.K. Agarwal Vice President (Corp. Accounts & Taxation) & CFO

10 Mr. P. Venkatesh Vice President - Operations

11 Mr. Sunil K.Jain Company Secretary

C. List of Relatives of Key Management Personnel ( KMP ) where transactions have taken place

S.No. Name of Relatives Relationship

1 Ms. Shradha Jatia Daughter of Mr. Prithvi Raj Jindal

2 Ms. Tripti Puneet Arya Daughter of Mr. Prithvi Raj Jindal

3 Mr. Vikram Pal Singh Son of Mr. H. S. Chaudhary

4 Mr. Vinay Chaudhary Son of Mr. H. S. Chaudhary

5 Ms. Mamta Chaudhary Daughter of Mr. H. S. Chaudhary

6 Ms. Madhulika Jain Wife of Mr. Sunil K.Jain

7 Master Sohil Jain Son of Mr. Sunil K.Jain

8 Master Shreyansh Jain Son of Mr. Sunil K.Jain

D. Entities, where individual,having significant influence over reporting enterprise or KMP and/or their relatives having significant influence

1 Bir Plantation Private Limited

2 Colorado Trading Company Limited

3 Four Seasons Investments Limited

4 Hexa Securities and Finance Company Limited

5 Hexa Tradex Limited

6 Jindal Equipment Leasing and Consultancy Services Limited

7 Jindal Industries Private Limited

8 Jindal Stainless Limited

9 Jindal Steel & Power Limited

10 Jindal Systems Private Limited

11 JSW Steel Limited

12 Mansarover Investments Limited

13 Nalwa Investments Limited

14 O. P. Jindal Charitable Trust

15 Rohit Tower Building Limited

16 Sminu Jindal Charitable Trust

17 Stainless Investments Limited

19. Segment Reporting

(i) Information about Business Segment

The Company has only one business segment '' Iron & Steel Products '' as primary Segment.

20. Details of Loans given, Investment made and Guarantees given, covered U/S 186[4] of the Companies Act, 2013:

* Loans given and Investment made are given under the respective heads

* Corporate Guarantees have been issued on behalf on subsidiary companies, details of which are given in related parties transactions at Note No. 44.

21. Previous year figures have been regrouped/rearranged, wherever considered necessary.


Mar 31, 2014

PARTICULARS As At As At 31st March, 2014 31st March, 2013 (Rs. in lacs) (Rs. in lacs)

1. CONTINGENT LIABILITIES

a) Guarantees issued by the Company''s bankers on behalf of the Company 78,348.56 87,721.40

b) Letter of Credit Outstanding 51,142.53 24,513.21

c) Claims against the company not acknowledged as debt 81.22 81.22

d) Corporate guarantees/ undertaking issued to lenders of subsidiary companies 138,445.59 91,596.56

e) Disputed Excise duty, Custom Duty and service tax 212.68 229.27

f) Income tax demands against which company has preferred appeals 2,534.68 2,609.59

g) Disputed Sales Tax 585.41 585.41

h) Liability in respect of Corporate Guarantee/Duty Saved for availing various export based incentive schemes 4,915.03 11,479.81

30. Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of Advances) 22,809.66 23,102.15

2. The details of amount outstanding to the Micro, Small and Medium Enterprises is as under :

There is no overdue principal amount and interest due to Micro, Small & Medium Enterprises. During the year no interest has been paid to such parties. This information has been determined to the extent such parties have been identified on the basis of information available with the company.

3. The Company''s manufacturing facility at Nashik has been granted "Mega Project Status" by Government of Maharashtra and therefore is eligible for Industrial Promotion Subsidy (IPS) under Packaged Scheme of Incentive (PSI) 2007.

The purpose of the Packaged Scheme of Incentive (PSI) 2007 is for intensifying and accelerating the process of dispersal of industries to the less developed regions and promoting high tech industries in the developed areas of the state coupled with the object of generating mass employment opportunities.

Modalities of payment of IPS consists of the following:

a. Electricity Duty exemption for a period of 7 years from the date of commencement of commercial production- from 10.09.2009 to 09.09.2016.

b. 100% exemption from payment of Stamp duty.

c. VAT and CST payable to the State Government (on sales made from Nashik plant, within a period of 7 years starting from10th Sep 2009).

IPS will be payable so as to restrict up to 75% of the Eligible Fixed Capital investments made from 13th Sep 2007 to 10th Sep 2009 . The Eligibility Certificate issued allows maximum Fixed Capital Investment of Rs. 350 crores and restricts IPS to 75% of Rs. 350 crores i.e. Rs. 262.50 crores.

In terms of the Accounting Standard (AS 12) "Accounting for Government Grants" prescribed by Companies (Accounting Standards) Amendment Rules, 2006, eligible incentive of Rs. 1,749.96 lacs ( Previous Year Rs. 1,538.06 lacs) is considered to be in the nature of promoters'' contribution and has been credited to Capital Reserve.

4. Due to unusual Depreciation in the value of the rupee against US Dollar and other foreign currencies during the year, the net loss on reinstatement/settlement of foreign currency monetary items other than long term foreign currency monetary items related to acquisition of depreciable assets has been considered by the Company to be exceptional in nature.

5. The Company has exercised the option in financial year 2011-12 for accounting of the exchange differences arising on long term foreign currency monetary items in line with Companies (Accounting Standard (Second Amendment) Rules, 2011 dated 29th December, 2011 relating to Accounting Standard (AS-11) notified by Central Government w.e.f. 1st April, 2011. Accordingly it has capitalized the exchange difference on long term foreign currency loans related to acquisition of depreciable assets.

6. The Company''s significant leasing arrangements are in respect of operating leases for premises-residential and offices. These leasing arrangements are cancellable. The aggregate lease rentals payables are charged as rent.

7. The Company has unquoted investments of Rs. 72,260.47 lacs (Previous Year Rs. 69,049.50 lacs) and Share Application Money of Rs. 3,949.67 lacs ( Previous Year Rs. 5,037.24 lacs ) in Subsidiary Companies, which have accumulated losses as per the latest available Balance Sheet and certain other unquoted investments where the fair value (amount unascertained) is lower than the cost, considering the long term strategic investments and future prospects, such diminution, in the opinion of the management, has been considered to be of temporary nature and hence no provision for the same is considered necessary.

8. An amount of Rs. 5,403.48 lacs (Previous Year Rs. 5,811.55 lacs) is outstanding from Subsidiary companies, which have accumulated losses. Having regard to the long- term involvement and future prospects, no provision is considered necessary towards these outstanding.

9. Charity and Donations includes Rs. NIL (Previous year Rs. 25 lacs paid to Bhartiya Janta Party, Gujarat State Unit ) as contribution to political parties.

10. Sundry Debtors, Creditors and other advances are subject to confirmation. The effect of the same, if any, which is not likely to be material, will be adjusted at the time of confirmation.

11. (a) The company has provided sponsor''s undertakings to lenders of the projects being sponsored by its wholly owned subsidiary namely Jindal ITF Limited. Major terms of the undertakings envisage investment/buy back of equity/instruments, retention of major equity in subsidiary company, supporting the projects for shortfall in debt servicing and in the eventuality of any cost overrun.

(b) Company has given guarantees/ indemnities for its step down subsidiary Company namely Jindal Saw Italia SPA (JSI)favoring supplier/lessor for (i) Inventory purchase by JSI (ii) towards plant performance/upkeep and (iii) employees benefits; total amounting to Rs. 8,419.42 lacs ( Previous Year Rs. 14,181.23 lacs).

(c) Some of the subsidiaries of the Company have privately placed various instruments including 9.25% -Compulsorily Convertible Debentures of Rs. 20,000 lacs, 0%- Compulsorily Convertible Debentures of Rs. 8,960 lacs and Redeemable Non Convertible Debentures aggregating to Rs. 28,130 lacs all aggregating to Rs. 57,090 lacs. The subscribers of such instruments have put option to require the Company to purchase the securities at the Put Option Price within the time period as per the terms of the agreement/s which is spread over a period ending June, 2017. The estimated amount of Put option of such securities as per the terms of the agreement/s is Rs. 64,245.19 lacs as on 31st March, 2014.

12. In the opinion of the Management, the realizable value of assets other than fixed assets and long term investments, in the ordinary course of business, would not be less than the amount at which they are stated.

13. Related Party Transactions

List of Related Parties and Relationship

A) Subsidiaries

i) Direct Subsidiaries

Sr. No. Name of the Company

1 Jindal ITF Limited

2 IUP Jindal Metal and Alloys Limited

3 S.V. Trading Limited

4 Jindal Fittings Limited

5 Quality Iron and Steel Limited

6 Ralael Holdings Limited

7 Jindal Saw Holdings FZE

8 Greenray Holdings Limited

9 Universal Tube Accessories Pvt. Limited

10 Jindal Saw Espana SL

ii) Indirect Subsidiaries (Control Exist)

Sr. No. Name of the Company

1 Jindal Saw USA, LLC

2 Jindal Saw Middle East FZC

3 Jindal Intellicom Limited

4 JITF Water Infrastructure Limited

5 JITF Urban Infrastructure Limited

6 JITF Shipyards Limited

7 Jindal Rail Infrastructure Limited

8 JITF Waterways Limited

9 JITF Infralogistics Limited

10 JITF Water Infra (Naya Raipur ) Limited

11 JITF ESIPL CETP (Sitarganj) Limited

12 Timarpur-Okhla Waste Management Co. Pvt. Limited

13 Jindal Saw Gulf LLC

14 Jindal Saw Italia S.P.A.

15 JITF Urban Infrastructure Services Limited

16 Intellicom Insurance Advisors Limited

17 Derwant Sand SARL

18 JITF Coal Logistics Limited

19 JITF Shipping and Logistics ( Singapore) PTE. Limited

20 JITF Urban Waste Management (Ferozepur) Limited

21 JITF Urban Waste Management (Jalandhar) Limited

22 JITF Urban Waste Management (Bathinda) Limited

23 JITF Industrial Infrastructure Development Co. Limited

B) Joint Ventures

Sr. No. Name of the Joint Venture

1 Jindal Saw Pipeline Solutions Limited(formerly known as Jindal Sigma Limited)

2 JWIL- SSIL JV

3 SMC-JWIL- JV

4 JWIL- Ranhill- JV

C) Key Management Personnel

1 Ms. Sminu Jindal Managing Director

2 Mr. Indresh Batra Managing Director

3 Mr. Neeraj Kumar Group CEO & Whole -time Director (w.e.f. 1st July, 2013 )

4 Mr. H S Chaudhary Whole Time Director

5 Mr. O P Sharma Chief Operating Officer (Large Dia. Pipe- SBU)

6 Dr. Dharmendra Gupta Director (Mines & Steel)

7 Mr. Dinesh Chandra Sinha President & SBU Head (w.e.f 19th August 2013 )

8 Mr. P. Venkatesh VP Operations (w.e.f 27th November, 2013 )

9 Mr. V S Konnur Joint Managing Director (Seamless Business) (upto 16th September, 2013 )

10 Mr. Anurag Shrivastva President (Mundra Operations) (upto 27th November, 2013 )

D) Relative of Key Management Personnel

Mr. P.R. Jindal

E) Enterprise over which Key Management Personnel having significant influence

1 Sminu Jindal Charitable Trust

2 Hexa Securities and Finance Co. Limited

3 Hexa Tradex Limited

14. Segment Reporting

(i) Information about Business Segment

The company has only one business segment '' Iron & Steel Products '' as primary Segment.

15. Previous year figures have been regrouped/re-arranged, wherever considered necessary.

16. Notes 1 to 52 are annexed and form integral part of Financial Statements.


Mar 31, 2013

1 The Scheme of Arrangement and Demerger (Scheme) entailing de-merger of Investment Undertaking of the Company into Hexa Tradex Limited (HTL) was sactioned by the Hon''ble High Court of Judicature at Allahabad. The Scheme became effective from November 5, 2011 on filing the same with the Registrar of Companies, UP.

As per the said Scheme, with effect from the Appointed Date i.e. 1st January, 201 1, the Investment Undertaking was transferred to and vested in HTL on a going concern basis pursuant to the provisions contained in Sections 391 to 394 and other applicable provisions of the Companies Act 1956. The effect of the Scheme was given in the financial results for the year ended 31st March, 2012.

As a consideration of transfer of Investment Undertaking, HTL issued and alloted to the equity shareholders of Company 1 (one) equity share of face value of Rs. 2/- (credited as fully paid-up) for every 5 (five) fully paid-up equity shares of Rs. 2/- each held by them in Jindal Saw Ltd. as on the record date, i.e., November 23, 2011. The equity shares so allotted by HTL are listed on NSE and BSE. As per the Scheme investment made by the company in HTL of Rs. 5 lacs stands cancelled and is debited to capital reserve.

The difference between the book value of assets and liabilities transferred pursuant to the Scheme was adjusted in previous year as follows:

(a) Capital Reserve Account: Rs. 2,133.90 lacs

(b) Security Premium Account: Rs. 1,9697.04 lacs

2 The Company''s manufacturing facility at Nashik has been granted "Mega Project Status" by Government of Maharashtra and therefore is eligible for Industrial Promotion Subsidy (IPS) under Packaged Scheme of Incentive (PSI) 2007.

The purpose of the Packaged Scheme of Incentive (PSI) 2007 is for intensifying and accelerating the process of dispersal of industries to the less developed regions and promoting high tech industries in the developed areas of the state coupled with the object of generating mass employment opportunities.

Modalities of payment of IPS consists of the following:

a. Electricity Duty exemption for a period of 7 years from the date of commencement of commercial production - from 10.09.2009 to 09.09.2016

b. 100% exemption from payment of Stamp duty.

c. VAT and CST payable to the State Government (on sales made from Nashik plant, within a period of 7 years starting from 10th Sep 2009).

IPS will be payable so as to restrict up to 75% of the Eligible Fixed Capital investments made from 13th Sep 2007 to 10th Sep 2009 . The Eligibility Certificate issued allows maximum Fixed Capital Investment of Rs. 350 crores and restrict IPS to 75% of Rs. 350 crores ie Rs. 262.50 crores.

In terms of the Accounting Standard (AS 12) "Accounting for Government Grants" prescribed by Companies (Accounting Standards) Amendment Rules, 2006, eligible incentive of Rs. 1538.06 lacs ( Previous Year Rs. 1,523.93 lacs) is considered to be in the nature of promoters'' contribution and has been credited to Capital Reserve.

3 Due to unusual Depreciation in the value of the rupee against US Dollar and other foreign currencies during the year, the net loss on reinstatement/settlement of foreign currency monetary items other than long term foreign currency monetary items related to acquistion of depreciable assets has been considered by the Company to be exceptional in nature.

Exceptional items for the current year includes Rs. 1,446.18 lacs ( debit ) on account of foreign exchange fluctuation relating to sales and material purchases . The amount of such fluctuation amounting to Rs. 9,318.86 lacs ( credit ) was included under the relevant heads of expenditure & income during last year.

4 The Company has exercised the option in financial year 2011-12 for accounting of the exchange differences arising on long term foreign currency monetary items in line with Companies (Accounting Standard (Second Amendment) Rules, 2011 dated 29th December, 201 1 relating to Accounting Standard (AS-1 1) notified by Central Government w.e.f 1st April, 201 1. Accordingly it has capitalized the exchange difference on long term foreign currency loans related to acquisition of depreciable assets.

5 The Company''s significant leasing arrangements are in respect of operating leases for premises-residential and offices. These leasing arrangements are cancellable. The aggregate lease rentals payables are charged as rent.

6 The Company has unquoted investments of Rs. 69,049.50 lacs (Previous Year Rs. 5,9911.89 lacs) and Share Application Money of Rs. 5,037.24 lacs ( Previous Year Rs. 8,660.78 lacs ) in Subsidiary Companies, which have accumulated losses as per the latest available Balance Sheet and certain other unquoted investments where the fair value (amount unascertained) is lower than the cost, considering the long term strategic investments and future prospects, such diminution, in the opinion of the manage- ment, has been considered to be of temporary nature and hence no provision for the same is considered necessary.

7 An amount of Rs. 5,811.55 lacs (Previous Year Rs. 6,777.54 lacs) is outstanding from Subsidiary companies, which have accumu- lated losses. Having regard to the long- term involvement and future prospects, no provision is considered necessary towards these outstanding.

8 Charity and Donations includes Rs. 25 lacs (Previous year NIL ) paid to Bhartiya Janta Party,Gujrat State Unit as contribution to political parties.

9 Sundry Debtors, Creditors and other advances are subject to confirmation. The effect of the same, if any, which is not likely to be material, will be adjusted at the time of confirmation.

10 (a) The company has provided sponsor''s undertakings to lenders of the projects being sponsored by its wholly owned subsidiary namely Jindal ITF Limited. Major terms of the undertakings envisage investment/buyback of equity/instruments, retention of major equity in subsidiary company, supporting the projects for shortfall in debt servicing and in the eventual- ity of any cost overrun.

(b) Company has given guarantees/ indemnities for its step down subsidiary Company namely Jindal Saw Italia SPA (JSI)favoring supplier/lessor for (i) Inventory purchase by JSI (ii) towards plant performance/upkeep and (iii) employees benefits; total amounting to Rs. 1,4181.23 lacs ( Previous Year Rs. 21994.37 lacs)

(c) One of the subsidiary of the Company has privately placed various instruments including 9.25% -Compulsorily Convert- ible Debentures of Rs. 20,000 Lacs, 0%- Compulsorily Convertible Debentures of Rs. 10,000 Lacs and Redeemable Non Convertible Debentures aggregating to Rs.16,000 lacs all aggregating to Rs. 46,000 lacs. The subscribers of such instruments have put option to require the Company to purchase the put securities at the Put Option Price within the time period as per the terms of the agreement/s which is spread over a period ending June, 2017. The estimated amount of buy back option, if so opted of such securities as per the pricing of the agreement/s as on 31st March, 2013 is Rs. 49,870 lacs.

11 In the opinion of the Management, the realizable value of assets other than fixed assets and long term investments, in the ordinary course of business, would not be less than the amount at which they are stated.

12 Related Party Disclosures

List of Related Parties and Relationship

A) Subsidiaries

i) Direct Subsidiaries:-

Sr.No Name of the Company

1 Jindal ITF Ltd.

2 IUP Jindal Metal and Alloys Ltd.

3 S.V. Trading Ltd.

4 Jindal Fittings Ltd.

5 Quality Iron and Steel Ltd.

6 Ralael Holdings Ltd.

7 Jindal Saw Holdings FZE

8 Greenray Holdings Limited

9 Universal Tube Accessories Pvt Ltd (w.e.f 30th August 2012)

10 Jindal Saw Espana SL (w.e.f. 21st March 2013)

ii) Indirect Subsidiaries (Control Exist)

Sr.No Name of the Company

1 Jindal Saw USA, LLC

2 Jindal Saw Middle East FZC

3 Jindal Intellicom Limited

4 JITF Water Infrastructure Limited

5 JITF Urban Infrastructure Ltd.

6 JITF Shipyards Ltd.

7 Jindal Rail Infrastructure Ltd.

8 JITF Waterways Ltd.

9 JITF Infralogistics Ltd.

10 JITF Water Infra (Naya Raipur ) Ltd.

11 JITF ESIPL CETP (Sitarganj) Ltd.

12 Timarpur-Okhla Waste Management Co. Pvt. Ltd.

13 Jindal Saw Gulf LLC

14 Jindal Saw Italia S.P.A.

15 JITF Urban Infrastucture Services Ltd.

16 Intellicom Insurance Advisors Ltd.

17 Derwant Sand SARL

18 JITF Coal Logistics Ltd.

19 JITF Shipping and Logistics ( Singapore) PTE. Ltd.

20 JITF Urban Waste Management (Ferozepur) Ltd.

21 JITF Urban Waste Management (Jalandhar) Ltd.

22 JITF Urban Waste Management (Bathinda) Ltd.

23 JITF Industrial Infrastructure Development Co. Limited (w.e.f 2nd May 2012)

24 Jindal ITF Kobelco Eco Ltd. (upto 31st October 2012)

25 JITF Manila Water Development Co Ltd (upto 6th Feburuary 2013 )

26 JITF Global Water Holding Pte. Ltd.

(Strike off application for closure is filed on 3rd January, 2013 with Accounting and Corporate Regulatory Authority, Singapore. Closure action is awaited)

27 JITF Water Infra (Rajkot) Ltd. (upto 29th January, 2013)

B) Joint Venture

1 Jindal Sigma Ltd.

2 JWIL-SSIL JV (w.e.f 28th Feb. 2012)

3 SMC-JWIL- JV (w.e.f 24th Dec. 2012)

4 JWIL- Ranhill- JV (w.e.f 27th Nov. 2012 )

C) Key Management Personnel

1 Ms. Sminu Jindal Managing Director

2 Mr. Indresh Batra Managing Director

3 Mr. H S Chaudhary Whole Time Director

4 Mr. O P Sharma Chief Operating Officer (Large Dia. Pipe- SBU)

5 Mr. K Chandrayya Director (Works- IPU) (upto 28th Feb. 2013 )

6 Mr. V S Konnur Joint Managing Director (Seamless Business)

7 Mr. Anurag Shrivastva President (Mundra Operations)

8 Dr. Dharmendra Gupta Director (Mines & Steel)

D) Relative of Key Management Personnel

Mr. P.R. Jindal

E) Enterprise over which Key Management Personnel having significant influence

1 Sminu Jindal Charitable Trust

2 Hexa Securities and Finance Co. Ltd.

3 Hexa Tradex Limited

13. Previous year figures have been regrouped/re-arranged, wherever considered necessary.

14. Notes 1 to 53 are annexed and form integral part of Financial Statements.

 
Subscribe now to get personal finance updates in your inbox!