Mar 31, 2023
The Board of Directors of Usha Martin Limited ("the Company") present the 37th Annual Report and Audited Accounts for the Financial Year ended 31st March 2023.
FINANCIAL SUMMARY / HIGHLIGHTS
(Rs. in Crore) |
||||
Stand Alone |
Consolidated |
|||
FY 2022-23 |
FY 2021-22 |
FY 2022-23 |
FY 2021-22 |
|
Net Turnover |
2,041.71 |
1,810.05 |
3,267.76 |
2,688.07 |
Earnings before Interest, Tax, Depreciation and Amortizations |
328.70 |
284.82* |
541.39 |
418.91* |
Depreciation |
26.51 |
31.40 |
67.48 |
69.75 |
Finance costs |
14.98 |
31.16 |
30.27 |
42.46 |
Profit before Tax |
287.21 |
253.44 |
443.64 |
337.88 |
Tax expenses |
73.51 |
42.13 |
104.78 |
54.85 |
Share of Profit of Joint Venture |
- |
- |
11.74 |
8.40 |
Profit after tax |
213.70 |
211.31 |
350.60 |
291.43 |
Other comprehensive income / (loss) [Net of Tax] |
(0.56) |
1.85 |
47.90 |
(1.10) |
Total comprehensive income / (loss) |
213.14 |
213.16 |
398.50 |
290.33 |
The turnover for the year was Rs. 3,267.76 Crore on consolidated basis and Rs. 2,041.71 Crore on standalone basis as compared to Rs. 2,688.07 Crore and Rs. 1,810.05 Crore respectively in the previous year. EBITDA was Rs. 541.39 Crore on consolidated basis as compared to Rs. 418.91* Crore in previous year and on standalone basis was Rs. 328.70 Crore as compared to Rs. 284.82* Crore in previous year.
A detailed discussion on review of operations of the Company has been included in Management Discussion and Analysis which forms part of this Report.
The Board of Directors at their meeting held on 27th April 2023 has recommended payment of Rs. 2.50 only (Rupees Two and Fifty paise only) [250%] (previous year Rs. 2 only [200%]) per equity share of the face value of Re.1 (Rupee One only) each as final dividend for the financial year ended 31st March 2023. The payment of final dividend is subject to the approval of shareholders at the ensuing Annual General Meeting ("AGM") of the Company.
In view of the changes made under the Income-tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of shareholders. The Company shall accordingly, make the payment of final dividend after deduction of tax at source.
The dividend recommended is in accordance with the Dividend Distribution Policy of the Company. The Dividend Distribution Policy, in terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") is available under the Investor Relations section on the Company''s
*Excluding exceptional item of Rs. 31.18 Crore.
website: https://ushamartin.com/upload/investorrelations/ DividendDistributionPolicy 20220505100821.pdf.
Your Directors do not propose to carry any amount to reserves for the year under review.
While speculation of global economic slowdown, liquidity crunch due to interest rate hike to contain inflation by major economies, supply chain disruptions due to geo-political tensions is expected to continue, spending by Government of India in infrastructural and social welfare projects such as roads, railways, water and sanitation along with expected revival in auto sector will give an impetus to the demand of specialty products of the Company. With renewed focus on specialty wire-rope business and strategic initiatives to consolidate leadership, the Company is undergoing a strategic transformation. The Company is poised for sustainable growth with value accretive capital expenditure plans, enhancement of specialty offerings across industry segments, increase of geographical spread in strategic markets through overseas subsidiaries and focus on digitisation initiatives. The Company is confident in confronting the challenges of an ever-changing macro-economic environment.
Certification of conformation with respect to Quality Management System under ISO 9001:2015 and Environmental Management System under ISO 14001:2015 continues to be maintained. Certificate of Product Design Assessment ("PDA") issued by ABS, Ship/Offshore Engineering Department, Singapore is in place. Further the Company continues to have Approval of Manufacturing ("AOM") from DNV-GL, ABS &
Lloyd. The organisation has a Certificate of Authority to use the
official API Monogram issued by American Petroleum Institute, USA. The Company continues to have a number of product certifications such as BIS from Bureau of Indian Standards, Inmetro of Brazil, SONCAP of Nigeria, China Classification Society of China, NKK of Japan, Certificate of Recognition for BV Mode II scheme by Bureau Veritas, SIRIM QAS of Malaysia, SNI of Indonesia. The Mooring Line Base Design Certification conforming with Mooring Equipment Guidelines is in place. LRPC product continues to be certified by Australasian Certification Authority for Reinforcing and Structural Steels Ltd and the Company is an approved manufacturer and supplier of wire ropes to mines recognised by Directorate General of Mines Safety, Dhanbad, India. The Company is also an approved manufacturer of elevator ropes recognized by TUVSUD. The Company has also received recognition as approved manufacturer of galvanized core wire from PGCIL, India. Further the Company continues to have Certificate of Accreditation in the field of testing as per ISO 17025: 2017 by National Accreditation Board for Testing & Calibration Laboratories (NABL).
The Company is in constant pursuit of achieving Business Excellence. Concepts of Value Engineering, Kaizen Management, Fuguai Management, 5S activities, Total Productive Management (TPM), Lean Manufacturing are embraced and integrated at our production facilities along with cost reduction initiatives, process improvements and digitization. This has resulted in promoting a culture of continuous improvement in productivity, efficiency, waste elimination, and cost reduction affirmatively impacting sustainable profitability and growth of the Company. The Company has also initiated a roadmap for achieving the target of "zero harm" in plant facilities. It is believed that the continuous focus on Business Excellence will result in further strengthening the competitive edge of the Company.
Maintaining and preserving the environment has always been of outmost priority of the Company. The Company continues to focus on controlled process emission, waste minimization, optimum utilization of natural resources, minimization of carbon footprints and sustainable water management for achieving environmental sustainability and ecological balance. To achieve the objective of environmental sustainability and stability, periodic environmental monitoring, online monitoring of emission and effluent, treatment and recycling of process effluent and utilization of fly-ash are undertaken. Use of alternate energy such as LPG and biomass briquette, use of energy efficient LED bulbs and motors to ensure optimum consumption of conventional energy, establishing and expanding green foot print by focusing on greenery & greenbelt development are some of the initiatives which are being continuously carried on by the Company towards its commitment for a sustainable environment and to address the environmental issues with respect to climate change and global warming. The environmental management system at
manufacturing facilities of the Company is accredited with ISO 14001:2015 certification.
The international subsidiaries of the Company provide significant synergy and support to the overall business and performance. A key joint venture formed by the Company namely Pengg Usha Martin Wires Private Limited continues to operate profitably at Ranchi in the State of Jharkhand reflected by a healthy balance sheet. During the year under review there were no entities which were incorporated or ceased to be subsidiaries, joint ventures and associates of the Company. A statement covering the performance and financial position of each of the subsidiaries, associates and joint ventures is provided separately and forms part of this Report.
During the year under review, the Company has not accepted any deposit under Section 73 of the Companies Act, 2013 ("the Act") and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). As on 31st March 2023, there are no unclaimed deposits with the Company. The Company has not defaulted in repayment of deposits or payment of interest on deposits thereon in the past.
The paid-up Equity Share Capital as on 31st March 2023 stood at Rs.30.54 Crore. During the year under review, the Company has not issued any shares with or without differential voting rights, granted stock options or issued sweat equity shares.
The total issued and paid-up equity shares of the Company as on 31st March 2023 as per the stock exchange records stands inflated by 230 equity shares. This was caused due to an erroneous additional electronic transfer of 230 equity shares to Investor Education & Protection Fund (IEPF) under the Ministry of Corporate Affairs (MCA) by way of corporate action executed on 29th September 2020 by Central Depository Services (India) Ltd (CDSL) and Registrar & Transfer Agent (RTA) of the Company. The Company has been continuously engaging with IEPF Authority under MCA, New Delhi for necessary rectification of this entry in the records.
Significant and Material Orders Passed by Regulators or Courts or Tribunals Impacting the Going Concern Status and Company''s Operations in Future
During the year, no significant material orders were passed by any regulatory authority or court against the Company which may affect the going concern status of the Company.
The Central Bureau of Investigation ("CBI") registered a regular case on 20th September 2016 ("FIR No. 1") under the Indian Penal Code, 1860 ("IPC") and the Prevention of Corruption Act, 1988 ("PC Act") against certain individuals and
the Company, wherein, inter-alia, various illegalities have been alleged qua the allocation of mine to the Company and abuse of official position by government servants. On October 2020, CBI registered another first information report ("FIR No. 2") under the PC Act read with the IPC against the Company, few officials of the Company and others, alleging influencing of the investigation in FIR No. 1 for which proceedings are pending adjudication at CBI Court, New Delhi.
The Directorate of Enforcement ("ED"), Patna passed a provisional order dated 9th August 2019 ("Provisional Order") for provisional attachment of certain immovable properties of the Company valued at approximately Rs.190 Crore pertaining to the wire rope business of the Company, situated at Ranchi in the State of Jharkhand. This order was passed in connection with sale of iron-ore fines in earlier years from the erstwhile iron-ore mines of the Company situated at West Singhbhum in the State of Jharkhand. On 10th January 2020, the Adjudicating Authority under the Prevention of Money Laundering Act, 2002 ("PMLA") issued an order confirming the Provisional Order, subsequent to which the Company filed applications for stay and appeal against the order of Adjudicating Authority, PMLA, with the Appellant Tribunal, PMLA, New Delhi. The Appellant Tribunal vide an order dated 31st January 2020 directed that status quo be maintained and presently the matter is pending adjudication before the Appellant Tribunal. ED filed a complaint followed by a supplementary complaint before the District and Sessions Judge cum Special Judge, Ranchi ("Ranchi Trial Court") which is pending adjudication at Ranchi Trial Court. Further, in connection with FIR 2, ED filed a complaint before the Special Court, New Delhi ("Special Court") under PMLA which is presently pending adjudication at Special Court.
Reference is drawn to Note 38 to the Accounts in this Annual Report and ''Emphasis of Matter'' by the Auditors in their Report.
Details in Respect of Adequacy of Internal Financial Controls with Reference to the Financial Statements
Based on the framework of internal financial controls and compliance systems established and maintained by the Company (with its inherent weaknesses), work performed by the internal, statutory, cost and secretarial auditors and external consultants specially appointed for this purpose, including audit of internal financial controls over financial reporting by the statutory auditors and reviews performed by management and relevant board committees, including the audit committee, the board is of the opinion that the Company''s internal financial controls were adequate and effective during the year ended on 31st March 2023.
Directors and Key Managerial Personnel
The five-year tenure of Mr. Rajeev Jhawar (DIN: 00086164) as Managing Director of the Company expires on 18th May 2023. The Board of Directors at its Meeting held on 27th April 2023
on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the members of the Company and that of Central Government, as applicable, have re-appointed him as Managing Director for a further period of five years from 19th May 2023 to 18th May 2028.
The four-year tenure of Mr. Vijay Singh Bapna (DIN:02599024) expires on 26th May 2023. The Board of Directors at its Meeting held on 27th April, 2023 on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the members of the Company, have appointed him as an Independent Director for a second term of five years from 27th May, 2023 to 26th May, 2028.
On 27th April 2023, the Board of Directors on the recommendation of the Nomination and Remuneration Committee and subject to approval from members of the Company, appointed (i) Mr. S K Modak (DIN: 00983527) as Whole-Time Director for a period of five years from 27th April 2023 to 26th April 2028 and (ii) Mr. Tapas Gangopadhyay (DIN: 10122397) as Non-Executive Director effective 27th April 2023.
As required under provisions of the Act and Listing Regulations, all Independent Directors of the Company have confirmed that they meet the requisite criteria of independence.
Mr. Devadip Bhowmik (DIN: 08656505) ceased to be a Director of the Company effective close of business hours of 27th April 2023.
During the year under review, there has been no other change in Key Managerial Personnel of the Company.
Directors'' Responsibility Statement
Pursuant to requirements under Section 134(5) of the Act, the Board, to the best of its knowledge and belief, confirms that:
i) the applicable accounting standards have been followed in preparation of annual accounts for Financial Year ended 31st March 2023 and proper explanations have been furnished relating to material departures;
ii) accounting policies have been selected and applied consistently and prudent judgments and estimates have been made so as to give a true and fair view of state of affairs of the Company at end of financial year and of profit and loss of the Company for year under review;
iii) proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with provisions of the Act for safeguarding assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the annual accounts for Financial Year ended 31st March 2023 have been prepared on a going concern basis;
v) internal financial controls are in place and that such financial controls are adequate and operating effectively;
vi) adequate systems to ensure compliance with the provisions of all applicable laws are in place and are operating effectively.
The criteria and manner for formal performance evaluation of individual Directors, the Board as a whole and the Board Committees has been formulated. Every Director evaluates the performance of other Directors (excepting himself/herself), the Board as a whole and its Committees and provides feedback to the Nomination & Remuneration Committee. The Nomination & Remuneration Committee reviews the feedback and makes relevant recommendation to the Board for final evaluation.
Nomination & Remuneration Policy
In accordance with the provisions of the Act and Listing Regulations, the Board of Directors of the Company on recommendation of the Nomination & Remuneration Committee has formulated the criteria for determination of qualification, positive attributes and independence of Directors along with remuneration of Directors, Senior Management Personnel (including Key Managerial Personnel) and other employees. The Remuneration Policy of the Company is annexed as part of this Report and is also available on the website of the Company at https://ushamartin.com/upload/investorrelations/ RemunerationPolicy 20230218075609.pdf.
Vigil Mechanism and Whistle Blower Policy
The Company has a coded Vigil Mechanism and Whistle Blower Policy available at https:// ushamartin.com/upload/investorrelations/ DetailsofEstablishmentofVigilMechanismWhistleBlower Policy 20211020071249.pdf. This Policy provides a framework to promote responsible and secure reporting of undesirable activities ("whistle blowing"). Through this Policy, the Company seeks to provide a mechanism to the whistleblower to disclose any misconduct, malpractice, unethical and improper practice taking place in the Company for appropriate action and reporting, without fear of any kind of discrimination, harassment, victimisation or any other unfair treatment or employment practice being adopted against the whistleblower.
Particulars of Employees & Managerial Remuneration
The required disclosure in accordance with Section 197 of the Act read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time is provided separately and forms part of this report.
In accordance with the provisions of the Listing Regulations, the Managing Director and Chief Financial Officer of the Company have submitted the relevant certificate for the year ended 31st March 2023 to the Board of Directors.
The Company had adopted effective from 1st April 2016, the notified Indian Accounting Standards (Ind AS) and accordingly the Financial Statements (both standalone and consolidated) for the year ended 31st March 2023 have been prepared under Ind AS. In line with the requirements of applicable provisions of law, the Company has made necessary disclosures in respect of Consolidated Financial Statements, Related Party Transactions and Segmental Reporting.
Further in accordance with the recent amendments made in Rule 8(5) (xi) of Companies (Accounts) Rules, 2014 this is to confirm that as on 31st March 2023, no application or any proceeding is pending under the Insolvency and Bankruptcy Code, 2016 against the Company. Also during the year under review there was no instance of one-time settlement with banks or financial institutions and hence the differences in valuation as enumerated under Rule 8 (5) (xii) do not arise. Further this is to confirm that during the year under review there was no change in the nature of business carried on by the Company or by any of its subsidiaries.
The requisite disclosure in relation to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been provided separately in this Annual Report.
In accordance with the provisions of Section 139 of the Act and pursuant to shareholders approval at the 35th Annual General Meeting held on 11th August 2021, Messrs. S.R. Batliboi & Co. LLP, Chartered Accountants (Firm Registration No. 301003E/ E300005) had been re-appointed as Statutory Auditors of the Company to hold office from the conclusion of the 35th Annual General Meeting till the conclusion of the 40th Annual General Meeting of the Company.
The Emphasis of Matter mentioned in the Auditors'' Report is self-explanatory. During the year under review, the Auditors did not report any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
Pursuant to Section 148 of the Act and Rules made thereunder, the Board had appointed M/s. Mani & Co., Cost Accountants for a term of one year, to conduct cost audit of the Company for the Financial Year 2022-23 and had recommended their remuneration to the shareholders which was ratified at the
Annual General Meeting held on 29th July 2022. Subsequent to the recommendation of the Audit Committee, the Board has re-appointed M/s. Mani & Co., Cost Accountants as the Cost Auditors of the Company for the Financial Year ending 31st March 2024 and their remuneration is sought to be ratified by the shareholders at the forthcoming Annual General Meeting and is included as an agenda item in the Notice convening the 37th Annual General Meeting of the Company.
Secretarial Audit and Corporate Governance Report
During the year under review, the Board of Directors had appointed M/s. A K Labh & Co. firm of Practicing Company Secretaries for conducting secretarial audit in accordance with the provisions of the Act and the Rules framed thereunder. The Secretarial Audit Report is annexed and forms part of this Report. The Company has complied with the applicable requirements of Listing Regulations (as amended) and followed the practice of getting disclosures from directors and senior management personnel relating to any material, financial and commercial transactions where they have any personal interest with a potential conflict of interest with the Company at large. A detailed Report on Corporate Governance is annexed and forms part of this Report. The Company has also complied with the Standards of Secretarial Standards 1 & 2 issued by the Institute of Company Secretaries of India as applicable during the year ended 31st March 2023. Observations mentioned in the Secretarial Audit Report is self-explanatory in nature.
Business Responsibility and Sustainability Report
The Business Responsibility and Sustainability Report as stipulated in the Listing Regulations, amended from time to time, forms part of the Annual report.
Members of the Audit Committee as on 31st March 2023 were Mr. Vijay Singh Bapna as Chairman, Mr. S Ravi and Mr. Rajeev Jhawar. The Company Secretary acts as the Secretary to the Audit Committee. All recommendations of the Audit Committee were duly accepted by the Board and there were no instances of any disagreement between the Committee and Board.
Corporate Social Responsibility (CSR)
The Company continues to take its role as a responsible corporate citizen very seriously and is deeply involved in sustainable development of communities in and around its areas of plant operations. The CSR policy of the Company is available on https://ushamartin.com/upload/investorrelations/ CorporateSocialResponsibilitvPolicv 20211020071955.pdf.
The Company''s commitment to its responsibilities towards society over the years has never been confined to the requirements of any statute. As per the provisions of Section 135 of the Act, the Company need not statutorily incur any social responsibility spending owing to absence of net profits (calculated in the manner as per the provisions of the Act) over the last three financial years and hence, the Company had not made any CSR spending as required under Section 135 of the Act. However, your Company continues to contribute voluntarily to Usha Martin Foundation which carries out various initiatives for social upliftment and development of communities living in and around the production facilities. As on 31st March 2023, the CSR committee comprised of Mr. Vijay Singh Bapna as Chairman, Mrs. Ramni Nirula and Mr. D J Basu as members. The annual report on CSR activities as required under the provisions of the Act and the Rules framed thereunder is provided elsewhere and forms part of this Report.
In accordance with Section 92 (3) read with Rule 12 of the Companies (Management and Administration) Rules 2014 (as amended) a copy of the Annual Return of the Company is hosted on its website and can be accessed at https:// ushamartin.com/investor-relations/annual-return#Annual-Return.
Number of Meetings of Board and it''s Committees
The details regarding meetings of the Board and Committees have been provided in the Corporate Governance Report forming part of this Report.
Particulars of Loans, Guarantees and Investments
The particulars of loans, guarantees or investments are provided in Note 5 and 30(C) to the Financial Statements.
Particulars of Contracts or Arrangements with Related Parties
During the year under review, in compliance with the Act and Listing Regulations, all related party transactions had been placed before the Audit committee for approval. Necessary approval of the Board has also been obtained where required. Relevant disclosure has been made in Form AOC-2 pursuant to Rule 8(2) of the Companies (Accounts) Rules, 2014 (as amended) and is given as an annexure to this Report. The Related Party Transaction Policy as approved by the Board is hosted on the Company''s website at https://ushamartin.com/upload/investorrelations/ PolicyonMaterialityandforDealingwithRelatedParty Transactions 20220712111232.pdf
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
Information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134 (3) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 (as amended) is annexed separately and forms part of this report.
The Risk Management Committee of the Board of Directors of the Company is entrusted with assisting the Board in discharging its responsibilities towards management of material business risk (material business risks include but is not limited to operational, financial, sustainability, compliance, strategic, ethical, reputational, product quality, human resource, industry, legislative or regulatory and market related risks) including monitoring and reviewing of the risk management plan / policies in accordance with the provisions of Listing Regulations. The Company has a risk organisation structure which reviews risks, identifies ownership of risk, assesses the implication of such risks and the method to mitigate the same. As on 31st March 2023, the Risk Management Committee comprised of Mr. Vijay Singh Bapna as Chairman, Mrs. Ramni Nirula, Mr. R Venkatachalam,
Mr. S Ravi, Mr. D J Basu and Mr. Devadip Bhowmik as Members.
Material Changes between the End of the Financial Year and Date of Report
There has been no material changes subsequent to the end of the Financial Year and the date of this report which requires to be specifically reported other than as mentioned elsewhere in this Annual Report.
Your directors place on record their appreciation for the valuable co-operation and support of its employees, customers, suppliers, contractors, value chain partners, shareholders, investors, government authorities, financial institutions, banks and other stakeholders.
On behalf of the Board of Directors
RAJEEV JHAWAR
Managing Director DIN: 00086164
DHRUB JYOTI BASU
Whole Time Director DIN: 02498037
Place: Kolkata Date: 27th April 2023
Mar 31, 2022
The Board of Directors of Usha Martin Limited ("the Company") present the 36th Annual Report and Audited Accounts for the Financial Year ended 31st March 2022.
FINANCIAL SUMMARY / HIGHLIGHTS
(Rs. in Crore) |
||||
Standalone |
Consolidated |
|||
FY 2021-22 |
FY 2020-21 |
FY 2021-22 |
FY 2020-21 |
|
Net Turnover |
1,810.05 |
1,345.60 |
2,688.07 |
2,097.28 |
Earnings before Interest, Tax, Depreciation and Amortizations |
316.00 |
205.52 |
450.09 |
312.56 |
Depreciation |
31.40 |
30.64 |
69.75 |
67.87 |
Finance costs |
31.16 |
44.52 |
42.46 |
56.90 |
Profit before tax from continuing operations |
253.44 |
130.36 |
337.88 |
187.79 |
Tax expenses |
42.13 |
25.40 |
54.85 |
36.44 |
Profit after tax from continuing operations |
211.31 |
104.96 |
283.03 |
151.35 |
Share of Profit of Joint Venture |
- |
- |
8.40 |
4.59 |
Profit after tax from discontinuing operations |
- |
(4.44) |
- |
(4.44) |
Profit after tax |
211.31 |
100.52 |
291.43 |
151.50 |
Other comprehensive income / (loss) |
1.85 |
(1.57) |
(1.10) |
18.90 |
Total comprehensive income / (loss) |
213.16 |
98.95 |
290.33 |
170.40 |
The turnover for the year was Rs. 2,688.07 Crore on consolidated basis and Rs. 1,810.05 Crore on standalone basis as compared to Rs. 2,097.28 Crore and Rs. 1,345.60 Crore respectively in the previous year. The Earnings before Interest, Depreciation and Tax was Rs. 450.09 Crore on consolidated basis as compared to Rs. 312.56 Crore in previous year and on standalone basis was Rs. 316.00 Crore as compared to Rs. 205.52 Crore in previous year.
A detailed discussion on review of operations of the Company has been included in Management Discussion and Analysis which forms part of this Report.
The Board of Directors at their meeting held on 30th April 2022, has recommended payment of Rs.2 only (Rupees Two only) (200%) per equity share of the face value of Re.1 (Rupee One only) each as final dividend for the financial year ended 31st March 2022. The payment of final dividend is subject to the approval of shareholders at the ensuing Annual General Meeting ("AGM") of the Company.
The dividend recommended is in accordance with the Dividend Distribution Policy of the Company. The Dividend Distribution Policy in terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") is available under the Investor Relations section on the Company''s website: https://www.ushamartin.com.
Your Directors do not propose to carry any amount to reserves for the year under review.
The next fiscal will continue to experience challenges in the nature of slowdown of economic growth, slag in demand, high input commodity prices, disruption in supply chain, increased freight cost and escalation of Russia - Ukraine conflict. Amidst all the uncertainties thrown up by the ongoing geographical tensions, a few upsides could include an increase in activities in oil & gas as well as energy segments, especially in non-affected countries. The Company, post divestment of its Steel Business Undertaking, has improved with renewed vigor with its focus on capability building, debottlenecking of constraints and increase in productivity of key products to remain agile and competitive. In order to continue to be sustainable, resilient and future ready, the Company is preparing for plans for augmenting capacity and capability building. There is focused effort for planned capability building by adding new machines for producing high end ropes and value-added products. Further, the plans for addition of capacity would focus mainly upon debottlenecking constraint areas and increase productivity of key products. With these plans in hand, the Company remains confident of making deeper inroads into international markets with high contributory products. It is also expected that with steady infrastructure spending by the Indian government, specialty products used in construction and infrastructural sector may become one of the key growth drivers for the Company. The future outlook is
expected to be a mixed bag of both opportunities and challenges with the key being the Company''s adaptability and proactive adjustments to an ever-changing macro-economic environment.
Certification of conformation with respect to Quality Management System with reference to the standard ISO 9001:2015 and Environmental Management System with reference standard ISO 14001:2015 continues to be maintained. Certificate of Product Design Assessment ("PDA") issued by ABS, Ship/Offshore Engineering Department, Singapore is in place. Further the Company continues to have Approval of Manufacturing ("AOM") by DNV-GL, ABS & Lloyd. The organisation has Certificate of Authority to use the official API Monogram issued by American Petroleum Institute, USA. The Company continues to have a number of product certifications such as BIS from Bureau of Indian Standards, Inmetro of Brazil, SONCAP of Nigeria by SGS of India, China Classification Society of China, NKK of Japan, Certificate of recognition for BV Mode II scheme by Bureau Veritas, SIRIM QAS of Malaysia. The Mooring Line Base Design Certification conforms with Mooring Equipment Guidelines. LRPC product continues to be certified by Australasian Certification Authority for Reinforcing and Structural Steels Ltd and High Tensile Steel Wire and Strand for the Prestressing of Concrete product has been certified by Dubai Central Laboratory Department of Dubai and the Company is also an approved manufacturer and supplier of wire ropes to mines recognised by Directorate General of Mines Safety, Dhanbad, India. Further the Company continues to have Certificate of Accreditation in the field of testing as per ISO 17025: 2017 by National Accreditation Board for Testing & Calibration Laboratories ("NABL").
The Company continues to pursue Business Excellence with concepts like Kaizen Management, Fuguai Management, TPM, Lean Manufacturing, Cost Reduction initiatives, Process Improvements which are being integrated and implemented in operation, maintenance and service functions of plants of the Company which have resulted in promoting a culture of continuous improvement with a focus on improving productivity and efficiency, eliminating wastes, reducing costs, impacting affirmatively operational efficiencies, profitability and growth of the Company. This continued focus on Business Excellence is expected to further strengthen and bolster competitiveness with respect to quality, cost and delivery of the business of the Company.
The Company is fully committed towards maintaining quality and preservation of environment and has continued its pursuit for achieving environmental sustainability and ecological balance through reduced and controlled process emission, waste minimization and reduction in consumption of energy, water and raw materials. Periodic environmental monitoring, online monitoring of emission and effluent, treatment and recycling of process effluent are continuously being carried out. Further fly ash utilisation level has achieved optimal level. The Company is vigorously continuing with its initiatives to address global environmental issues viz climatic change, global warming through continued and sustained efforts by use of alternate energy such as use of LPG and biomass briquette as fuel, less consumption of conventional energy such as use of energy efficient LED bulbs and motors, establishing and expanding green foot print by focusing on greenery & greenbelt development. The environmental management system at manufacturing facilities of the Company continue to be accredited with ISO 14001:2015 certification.
The international subsidiaries of the Company provide significant synergy and support to the overall business and performance. A key joint venture formed by the Company namely Pengg Usha Martin Wires Private Limited has reported excellent results in the year under review. During the year under review there were no other entities which became or ceased to be subsidiaries, joint ventures and associates of the Company. A statement covering the performance and financial position of each of the subsidiaries, associates and joint ventures is provided separately and forms part of this Report.
During the year under review, the Company has not accepted any deposit under Section 73 of the Companies Act, 2013 ("the Act") and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). As on 31st March 2022, there are no unclaimed deposits with the Company. The Company has not defaulted in repayment of deposits or payment of interest on deposits thereon in the past.
Share Capital
The paid-up Equity Share Capital as on 31st March 2022 stood at Rs. 30.54 Crore. During the year under review, the Company has not issued any shares with or without differential voting rights, granted stock options or issued sweat equity shares.
The total issued and paid-up equity shares of the Company as on 31st March 2022 as per the stock exchange records stands inflated by 230 equity shares. This was caused due to an erroneous additional electronic transfer of 230 equity shares to Investor Education & Protection Fund ("IEPF") under the Ministry of Corporate Affairs ("MCA") by way of corporate action executed on 29th September 2020 by Central Depository Services (India) Ltd ("CDSL") and Registrar & Transfer Agent ("RTA") of the Company. The Company has been continuously engaging with IEPF under MCA, CDSL and RTA for necessary rectification /reversal of erroneous entry. Due to Covid pandemic there is a delay in necessary rectification/reversal.
Scheme of the Arrangement for Capital Reduction &
Capital Reorganisation
The Board of Directors at their meeting held on 20th May 2021 approved the Scheme of the Arrangement ("Scheme") between the Company and its Shareholders for reduction & reorganisation of capital of the Company wherein the credit balances of various items of Reserves in the Balance Sheet would be adjusted against the entire negative balance of Retained Earnings. The aforementioned reduction & reorganisation of Capital of the Company does not prejudicially affect the Company or its Shareholders or any other Stakeholders and does not in any way adversely affect the operations of the Company or the ability of the Company to honor its commitments. Subsequent to the receipt of No Objection Letters from the Stock Exchanges where the Equity Shares of the Company are listed and requisite approval from Shareholders of the Company, the Hon''ble National Company Law Tribunal, Kolkata Bench ("Tribunal") approved the Scheme on 31st March 2022. Reference is drawn to Note 41 to the Accounts in the Annual Report.
Significant and Material Orders Passed by Regulators or Courts or Tribunals Impacting the Going Concern Status and Companyâs Operations in Future
During the year, no significant material orders were passed by any regulatory authority or court against the Company which may affect the going concern status of the Company.
The Central Bureau of Investigation ("CBI") registered a regular case on 20th September 2016 ("FIR No. 1") under the Indian Penal Code, 1860 ("IPC") and The Prevention of Corruption Act, 1988 ("PC Act") against certain individuals and the Company, wherein, inter-alia, various illegalities have been alleged qua the allocation of mine to the Company and abuse of official position by government servants. The CBI is conducting investigations in the matter, though no charge-sheet under the Code of Criminal Procedure, 1973 has been filed before the concerned court. On October 2020, CBI registered another First Information Report under the PC Act read with the IPC against the Company, few officials of the Company and others, alleging influencing of the investigation in FIR No. 1. While a preliminary chargesheet has been filed before the CBI Court, New Delhi, no cognizance has been taken by the said court and further investigation is pending.
The Directorate of Enforcement ("ED"), Patna passed a provisional order dated 9th August 2019 ("Provisional Order") for provisional attachment of certain immovable properties of the Company valued at approximately Rs.190 Crore pertaining to the wire rope business of the Company, situated at Ranchi in the State of Jharkhand. This order was passed in connection with sale of iron-ore fines in earlier years from the erstwhile iron-ore mines of the Company situated at West Singhbhum in the State of Jharkhand. On 10th January 2020, the Adjudicating Authority under the Prevention of Money Laundering Act, 2002 ("PMLA") issued an order confirming the Provisional Order, subsequent to
which the Company filed applications for stay and appeal against the order of Adjudicating Authority, PMLA, with the Appellant Tribunal, PMLA, New Delhi. The Appellant Tribunal vide an order dated 31st January 2020 directed that status quo be maintained till the next date of hearing. Due to Covid pandemic there has been no progress in this matter. Further, during the year under review, ED filed a complaint before the District and Sessions Judge cum Special Judge, Ranchi ("Ranchi Trial Court"). On 15th December 2021, the Supreme Court passed an order and stayed the ongoing proceedings at Ranchi Trial Court. In view of the stay granted by the Supreme Court, no further proceedings have been initiated by the Ranchi Trial Court.
Reference is drawn to Note 38 to the Accounts in this Annual Report and the ''Emphasis of Matter'' by the Auditors in their Report.
Details in respect of adequacy of Internal Financial Controls with reference to the Financial Statements.
Based on the framework of internal financial controls and compliance systems established and maintained by the Company (with its inherent weaknesses), work performed by the internal, statutory, cost and secretarial auditors and external consultants specially appointed for this purpose, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and relevant board committees, including the audit committee, the board is of the opinion that the Company''s internal financial controls were adequate and effective during the year ended on 31st March 2022.
Directors and Key Managerial Personnel
Mr. R Venkatachalam (DIN: 02194830) subsequent to withdrawal of his nomination on the Board of the Company by State Bank of India (Lender) ceased to be the Nominee Director. The Board at its Meeting held on 12th November 2021 had appointed Mr. Sethurathnam Ravi (DIN: 00009790) and Mr. R Venkatachalam (DIN: 02194830) as Additional Independent Directors of the Company effective from the aforesaid Board Meeting date. In accordance with requirement of amended SEBI Listing Regulations, approval of shareholders with requisite majority for appointments of Mr. Ravi and Mr. Venkatachalam as Independent Directors for a period of five consecutive years was obtained vide Postal Ballot on 23rd December 2021.
The shareholders of the Company at the 35th Annual General Meeting held on 11th August 2021 had approved with requisite majority the appointment (including the remuneration) of Mr. Devadip Bhowmik (DIN: 08656505) as the Whole Time Director of the Company effective 15th March 2021 for a period of five years. Further in terms of Section 152 of the Act, Mr. Bhowmik is retiring by rotation and being eligible, offers himself for re-appointment at the forthcoming Annual General Meeting.
the Nomination & Remuneration Committee. The Nomination & Remuneration Committee reviews the feedback and makes relevant recommendation to the Board for final evaluation.
Nomination & Remuneration Policy
In accordance with the provisions of the Act and SEBI Listing Regulations, the Board of Directors of the Company on recommendation of the Nomination & Remuneration Committee has formulated the criteria for determination of qualification, positive attributes and independence of Directors along with remuneration of Directors, Senior Management Personnel (including Key Managerial Personnel) and other employees. The Remuneration Policy of the Company is annexed as part of this Report and is also available on the website of the Company at www.ushamartin.com.
Vigil Mechanism and Whistle Blower Policy
The Company has a coded Vigil Mechanism and Whistle Blower Policy available at www.ushamartin.com. This Policy provides a framework to promote responsible and secure reporting of undesirable activities ("whistle blowing"). Through this Policy, the Company seeks to provide a mechanism to the whistleblower to disclose any misconduct, malpractice, unethical and improper practice taking place in the Company for appropriate action and reporting, without fear of any kind of discrimination, harassment, victimisation or any other unfair treatment or employment practice being adopted against the whistleblower.
Particulars of Employees & Managerial Remuneration
The required disclosure in accordance with Section 197 of the Act read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time is provided separately and forms part of this report.
CEO and CFO Certification
In accordance with the provisions of the SEBI Listing Regulations, the Managing Director and Chief Financial Officer of the Company have submitted the relevant certificate for the year ended 31st March 2022 to the Board of Directors.
Additional Disclosures
The Company had adopted effective from 1st April 2016, the notified Indian Accounting Standards ("IND AS") and accordingly the Financial Statements (both standalone and consolidated) for the year ended 31st March 2022 have been prepared under Ind AS. In line with requirements of applicable provisions of law, the Company has made necessary disclosures in respect of Consolidated Financial Statements, Related Party Transactions and Segmental Reporting.
Further in accordance with the recent amendments made in Rule 8(5) (xi) of Companies (Accounts) Rules, 2014 this is to confirm that during the year under review and as on 31st March 2022, no
Brief profile of Mr. Devadip Bhowmik is given in the Notice convening the forthcoming Annual General Meeting.
The shareholders of the Company at the 31st Annual General Meeting held on 21st September 2017 had appointed Mr. Mukesh Rohatgi (DIN: 00136067) as an Independent Director for a tenure of five years till 8th December 2021. Accordingly, after expiry of the said tenure, Mr. Rohatgi ceased to be a director and consequently the Chairman of the Board and the Company. The Board placed on record its appreciation for his immense support, invaluable guidance and contribution. The Board of Directors at its Meeting held on 11th February 2022 designated Mr. Vijay Singh Bapna (DIN: 02599024) as the Chairman of the Board and the Company effective from the aforesaid Board Meeting date.
As required under provisions of the Act and SEBI Listing Regulations, all Independent Directors of the Company have confirmed that they meet the requisite criteria of independence.
During the year under review, there has been no other change in Key Managerial Personnel of the Company.
Directorsâ Responsibility Statement
Pursuant to requirements under Section 134(5) of the Act, the Board, to the best of its knowledge and belief, confirms that:
i) the applicable accounting standards have been followed in preparation of annual accounts for Financial Year ended 31st March 2022 and proper explanations have been furnished relating to material departures;
ii) accounting policies have been selected and applied consistently and prudent judgments and estimates have been made so as to give a true and fair view of state of affairs of the Company at end of financial year and of profit and loss of the Company for year under review;
iii) proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with provisions of the Act for safeguarding assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the annual accounts for Financial Year ended 31st March 2022 have been prepared on a going concern basis;
v) i nternal financial controls are in place and that such financial controls are adequate and operating effectively;
vi) adequate systems to ensure compliance with the provisions of all applicable laws are in place and are operating effectively.
The criteria and manner for formal performance evaluation of individual Directors, the Board as a whole and the Board Committees has been formulated. Every Director evaluates the performance of other Directors (excepting himself/herself), the Board as a whole and its Committees and provides feedback to
application has been made or any proceeding is pending under the Insolvency and Bankruptcy Code, 2016 against the Company. Also during the year under review there was no instance of onetime settlement with banks or financial institutions and hence the differences in valuation as enumerated under Rule 8 (5) (xii) do not arise. Further this is to confirm that during the year under review there were no changes in the nature of business carried on by the Company or by any of its subsidiaries.
The requisite disclosure in relation to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been provided separately in this Annual Report.
In accordance with the provisions of Section 139 of the Act and pursuant to shareholders approval at the 35th Annual General Meeting held on 11th August 2021, Messrs. S.R. Batliboi & Co. LLP, Chartered Accountants (Firm Registration No. 301003E/ E300005) have been re-appointed as Statutory Auditors of the Company to hold office from the conclusion of the 35th Annual General Meeting till the conclusion of the 40th Annual General Meeting of the Company.
The Emphasis of Matter mentioned in the Auditors'' Report is self-explanatory. During the year under review, the Auditors did not report any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
Pursuant to Section 148 of the Act and Rules made thereunder, the Board had appointed M/s. Mani & Co., Cost Accountants for a term of one year, to conduct cost audit of the Company for the Financial Year 2020-21 and had recommended their remuneration to the shareholders which was ratified at the Annual General Meeting held on 11th August 2021. Subsequent to the recommendation of the Audit committee, the Board has re-appointed M/s. Mani & Co., Cost Accountants as the Cost Auditors of the Company for the Financial Year ending 31st March 2023 and their remuneration is sought to be ratified by the shareholders at the forthcoming Annual General Meeting and is included as an agenda item in the Notice convening the 36th Annual General Meeting of the Company.
Secretarial Audit and Corporate Governance Report
During the year under review, the Board of Directors had appointed M/s. A K Labh & Co. firm of Practicing Company Secretaries for conducting secretarial audit in accordance with the provisions of the Act and the Rules framed thereunder. The Secretarial Audit Report is annexed and forms part of
this Report. The Company has complied with the applicable requirements of SEBI Listing Regulations, (as amended) and followed the practice of getting disclosures from directors and senior management personnel relating to any material, financial and commercial transactions where they have any personal interest with a potential conflict of interest with the Company at large. A detailed Report on Corporate Governance is annexed and forms part of this Report. The Company has also complied with the Standards of Secretarial Standards 1 & 2 issued by the Institute of Company Secretaries of India as applicable during the year ended 31st March 2022.
Business Responsibility and Sustainability Report
The Business Responsibility and Sustainability Report as stipulated in the SEBI Listing Regulations, amended from time to time, forms part of the Annual Report.
Audit Committee
Members of the Audit Committee as on 31st March 2022 were Mr. Vijay Singh Bapna as Chairman, Mr. S Ravi and Mr. Rajeev Jhawar as members of the Committee. The Company Secretary acts as the Secretary to the Audit Committee. All recommendations of the Audit Committee were duly accepted by the Board and there were no instance of any dis-agreement between the Committee and Board.
Corporate Social Responsibility (CSR)
The Company continues to take its role as a responsible corporate citizen very seriously and is deeply involved in sustainable development of communities in and around its areas of plant operations. The CSR policy of the Company is available on https://www.ushamartin.com. The Company''s commitment to its responsibilities towards society over the years has never been confined to the requirements of any statute. As per the provisions of Section 135 of the Act, the Company need not statutorily incur any social responsibility spending owing to absence of net profits (calculated in the manner as per the provisions of the Act) over the last three financial years and hence, the Company had not made any CSR spending as required under Section 135 of the Act. In view of no spending on account of CSR activities under Section 135 of the Act, a separate Annual Report on CSR activities has not been provided in this annual report. However, your Company continues to contribute voluntarily to Usha Martin Foundation which carries out various CSR initiatives for upliftment and development of communities living in and around the production facility situated at Ranchi in the State of Jharkhand. As on 31st March 2022, the CSR committee comprised of Mr. Vijay Singh Bapna as Chairman, Mrs. Ramni Nirula and Mr. D J Basu as members.
Details of the net profit/(loss) for the last three financial years computed in accordance with the formulae provided in Section 198 of the Companies Act, 2013 are provided herein under:
(Rs. in Crore) |
|||
FY 2018-19 |
FY 2019-20 |
FY 2020-21 |
|
Net profit/(loss) |
^|(1,649.70) |
(1,637.12) |
(1,496.93) |
Average Net Loss for the last three financial years is Rs. 1,594.58 Crore. Hence as per the requirements of the Act, the Company was not required to make any statutory spending towards CSR activities. However, the Company has voluntarily contributed towards different social initiatives taken up during the year under review as is mentioned elsewhere in this Annual Report.
In accordance with Section 92 (3) read with Rule 12 of the Companies (Management and Administration) Rules 2014 (as amended) a copy of the Annual Return of the Company is hosted on its website and can be accessed at https://www.ushamartin.com.
Number of Meetings of Board and itâs Committees
The details regarding meetings of the Board and Committees have been provided in the Corporate Governance Report forming part of this Report.
Particulars of Loans, Guarantees and Investments
The particulars of loans, guarantees or investments are provided in the Financial Statements.
Particulars of Contracts or Arrangements with Related Parties
During the year under review, in compliance with the Act and SEBI Listing Regulations, all related party transactions had been placed before the Audit Committee for approval. Necessary approval of the Board has also been obtained where required. Relevant disclosure has been made in Form AOC-2 pursuant to Rule 8(2) of the Companies (Accounts) Rules, 2014 (as amended) given as an annexure to this Report. The Related Party Transaction Policy as approved by the Board is hosted on the Company''s website at https://www.ushamartin.com.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
Information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134 (3) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 (as amended) is annexed separately and forms part of this report.
The Risk Management Committee of the Board of Directors of the Company is entrusted with assisting the Board in discharging its responsibilities towards management of material business risk (material business risks include but is not limited to operational, financial, sustainability, compliance, strategic, ethical, reputational, product quality, human resource, industry, legislative or regulatory and market related risks) including monitoring and reviewing of the risk management plan / policies in accordance with the provisions of SEBI Listing Regulations. The Company has formulated a robust Risk framework which reviews risks, identifies ownership of risk, assesses the implication of such risks and the method to mitigate the same. As on 31st March 2022, the Risk Management Committee comprised of Mr. Vijay Singh Bapna as Chairman, Mrs. Ramni Nirula, Mr. R Venkatachalam, Mr. S Ravi, Mr. D J Basu and Mr. Devadip Bhowmik as Members.
Material Changes between the End of the Financial Year and Date of Report
There has been no material changes subsequent to the end of the Financial Year and the date of this report which requires to be specifically reported other than as mentioned elsewhere in this Annual Report.
Your Directors place on record their appreciation for the valuable co-operation and support of its employees, customers, suppliers, contractors, shareholders, investors, government authorities, financial institutions, banks and other stakeholders.
On behalf of the Board of Directors Rajeev Jhawar Managing Director DIN: 00086164
Dhrub Jyoti Basu
Place: Kolkata Whole Time Director
Date: 30th April 2022 DIN: 02498037
Mar 31, 2018
Dear Shareholders,
The Board of Directors of Usha Martin Limited (âthe Companyâ) present the 32nd Annual Report and Audited Accounts for the Financial Year ended 31st March, 2018.
FINANCIAL SUMMARY / HIGHLIGHTS (Rs. in Crore)
Stand Alone |
Consolidated |
|||
31st March, 2018 |
31st March, 2017 |
31st March, 2018 |
31st March, 2017 |
|
Net Sales / Income from Operations |
4,038.97 |
3,246.54 |
4,657.78 |
3,881.94 |
Other Income (including Finance Income) |
86.45 |
116.76 |
85.30 |
119.91 |
Total Income (Net of Excise Duty) |
4,125.42 |
3,363.30 |
4,743.08 |
4,001.85 |
Profit/(Loss) Before Interest, Depreciation & Tax |
562.21 |
462.64 |
628.17 |
509.33 |
Depreciation |
273.57 |
268.58 |
304.87 |
299.98 |
Finance Costs |
570.98 |
549.01 |
586.98 |
564.24 |
Profit/(Loss) Before Tax |
(282.34) |
(354.95) |
(263.68) |
(354.89) |
Tax expenses ( including MAT and Deferred Tax) |
- |
- |
5.11 |
4.63 |
Profit /(Loss) After Tax [Profit /(Loss) for the year attributable to equity shareholders of the Company] |
(282.34) |
(354.95) |
(271.23) |
(358.91) |
Review of Operations
The turnover (net of excise) for the year was Rs. 4,657.78 Cr on consolidated basis and Rs. 4,038.97 Cr on standalone basis as compared to Rs. 3,881.94 Cr and Rs. 3,246.54 Cr respectively in the previous year. The Earnings Before Interest, Depreciation and Tax was Rs. 628.17 Cr on consolidated basis as compared to Rs. 509.33 Cr in previous year and on standalone basis from Rs. 462.64 Cr to Rs. 562.21 Cr.
A detailed discussion on review of operations under Steel and Wire & Wire Rope (WWR) businesses has been included in Management Discussion and Analysis which forms part of this Report.
Dividend & Reserves
In view of there being no profits, the Directors are unable to recommend dividend for the year under review, nor do they propose to carry any amount to reserves.
Outlook and Business
During the year under review the improving worldwide economic conditions resulted in a better year for the steel industry with robust demand from automotive and construction sector in India. Continuation of global economic expansion resulted in increase of steel prices globally, except in USA, where the prices remained relatively stable. The demand for steel is expected to continue its current momentum, notwithstanding the decrease in demand in China.
During the year under review, the WWR business witnessed recovery in wire rope prices and also an overall uptick in the demand scenario which continued across most market segments excepting Oil & Offshore sector where the demand remained subdued. However, considering the improvement in Oil prices, the demand for wire ropes in Oil & Offshore sector may show signs of upswing from end of current fiscal both in domestic and international markets. Other products such as elevator rope and LRPC strands will continue to remain important areas of growth for your Company. There will be focused effort to increase market share in high contributory items like crane, elevator & mining ropes.
TPM & Quality
The Companyâs steel division continues to have certification that includes ISO 9001:2008 in Quality Management System, ISO-TS 16949:2009 in connection with QMS for Automotive Industries, ISO 14001:2015 Environment Management System, ISO 50001:2011 Energy Management System and OHSAS 18001:2007. IATF 16949:2016 Automotive Quality Management System Standard and ISO 9001:2015 QMS certifications are in progress. Further steel division is also certified by JIPMS, Japan for TPM excellence. Implementation of Total Quality Management (TQM) is currently underway in steel division.
WWR divisionâs Quality Management System certification is under transition from ISO 9001:2008 to ISO 9001:2015. ISO 14001:2004 Environmental Management System Certification, Approval of Manufacturing (AOM) by DNV-GL, ABS and Lloydâs are in place. Wire rope has product certification by SNI of Indonesia, Inmetro of Brazil, SONCAP of Nigeria and CCS of China. LRPC product is certified by ACRS of Australia and testing laboratory has accreditation under ISO 17025:2005. In order to make fundamental changes in our way of thinking and working, the TQM journey of WWR division is being pursued. The concept of Daily Management has successfully been implemented in operation, maintenance and service areas. All key process indicators of different functions are being monitored regularly in a centralized place called Wire Rope Excellence Center. The TQM journey will further strengthen the competitiveness with respect to quality, cost and delivery of your Companyâs rope business.
Environment
Steel Division and Wire Ropes & Specialty Products Division operate under ISO 14001 Environment Management Systems (EMS) Standards.
Various initiatives were undertaken in steel division such as installation of pneumatic conveying system for bag filter dust, installation of rain gun sprinklers, installation of single orifice high pressure water spray nozzles, installation of new bag filters, sheeting of junction houses etc. A vehicular emission monitoring camp was organised by Government authorized agency at the Jamshedpur plant for vehicles wherein over 700 vehicles were checked and pollution under control (PUC) certificates were issued to vehicles which passed the test. All process generated waste water is treated in effluent treatment plants and thereafter the treated water is utilized in plant processes as part of our constant endeavor for natural resource conservation. Keeping in line with various green initiatives undertaken during the year more than 1 500 trees were planted.
The WWR division is also ensuring improvement in environment management performance by periodic monitoring, legal compliance & online monitoring of emission & effluent at CPP Water used above 2400 KL/Day is recycled and reused. In order to protect, maintain & improve natural environment 3,800 saplings of native & ornamental tree species have been planted for greenbelt development. A mother orchard of fruit bearing trees & forest plant nursery has been setup to cater the saplings for plantations.
Subsidiaries & Joint Ventures
The international subsidiaries provide significant synergy and support to the Companyâs wire rope business and performance. All the operating subsidiaries of the Company have continued to perform reasonably well in the economic and business circumstances which prevailed during the year under review.
A key joint venture formed by the Company namely Pengg Usha Martin Wires Private Limited has reported satisfactory results in the year under review.
During the year under review there were no other entities which became or ceased to be subsidiaries, joint ventures and associates of the Company.
A statement covering report on the performance and financial position of each of the subsidiaries, associates and joint ventures is provided separately and forms part of the Annual Report.
Deposits
During the year the Company has not accepted any deposit under Section 73 of the Companies Act, 2013 (âthe Actâ) and the Companies (Acceptance of Deposits) Rules, 2014. As on 31st March, 2018, there are no unclaimed deposits with the Company. The Company has not defaulted in repayment of deposits or payment of interest on deposits thereon in the past.
Share Capital
The paid-up Equity Share Capital as on 31st March, 2018 stood at Rs. 30.54 Crores. The Company has not issued any shares with or without differential voting rights, granted stock options or issued sweat equity shares, during the year under review.
Significant and material orders passed by regulators or courts or tribunals impacting the going concern status and Companyâs operations in future.
During the year, no significant material orders were passed by any regulatory authority or court against the Company which may affect the going concern status of the Company.
Details in respect of adequacy of internal financial controls with reference to the financial statements
Based on the framework of internal financial controls and compliance systems established and maintained by the Company (with its inherent weaknesses), work performed by the internal, statutory, cost and secretarial auditors and external consultants specially appointed for this purpose, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and relevant board committees, including the Audit Committee, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during the year ended on 31st March, 2018.
Directors and Key Managerial Personnel
Mr. Brij Kishore Jhawar (DIN:00086200) is retiring by rotation and being eligible, offers himself for re-appointment. A brief profile of Mr. Jhawar is given in the Notice convening the forthcoming Annual General Meeting.
Since the five year tenure of Mr. Rajeev Jhawar (DIN: 00086164) as Managing Director of the Company expires on 18th May 2018, the Board of Directors at its Meeting held on 5th February 2018 have, on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the members of the Company, re-appointed him as Managing Director for a further period of five years from 19th May 2018 to 18th May 2023. His brief profile and other relevant details are given in the Notice convening the forthcoming Annual General Meeting.
During the year under review, Mr. Ghyanendra Nath Bajpai was appointed as the Non-Executive Chairman of the Board and of the Company.
As required under provisions of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, all Independent Directors of the Company have confirmed that they meet the requisite criteria of independence.
There has been no change in the Key Managerial Personnel during the year under review.
Directorsâ Responsibility Statement
Pursuant to requirements under Section 134(5) of the Act, the Board, to the best of itâs knowledge and belief, confirms that:
i. the applicable accounting standards have been followed in preparation of annual accounts for Financial Year ended 31st March, 2018 and proper explanations have been furnished relating to material departures;
ii. accounting policies have been selected and applied consistently and prudent judgments and estimates have been made so as to give a true and fair view of state of affairs of the Company at end of financial year and of loss of the Company for year under review;
iii. proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with provisions of the Act for safeguarding assets of the Company and for preventing and detecting fraud and other irregularities;
iv. the annual accounts for Financial Year ended 31st March, 2018 have been prepared on a going concern basis;
v. internal financial controls are in place and that such financial controls are operating effectively;
vi. adequate systems to ensure compliance with the provisions of all applicable laws are in place and are operating effectively.
Board Evaluation
Criteria has been formulated for formal evaluation of the individual Directors, the Board as a whole and the Board Committees. Every Director evaluates the performance of other Directors (excepting himself/herself), the Board as a whole and itâs Committees and provides feedback to the Nomination & Remuneration Committee. The Nomination & Remuneration Committee reviews the feedback and makes relevant recommendation to the Board for final evaluation.
Nomination & Remuneration Policy
In accordance with the provisions of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors of the Company on recommendation of the Nomination & Remuneration Committee has formulated the criteria for determination of qualification, positive attributes and independence of Directors along with remuneration of Directors, Senior Management Personnel (including Key Management Personnel) and other employees. The Remuneration Policy of the Company is annexed as part of this Report.
Vigil Mechanism and Whistle Blower Policy
The Company has a coded Vigil Mechanism and Whistle Blower Policy available at www.ushamartin.com/investor. This Policy provides a framework to promote responsible and secure reporting of undesirable activities (âwhistle blowingâ). Through this Policy, the Company seeks to provide a mechanism to the whistleblower to disclose any misconduct, malpractice, unethical and improper practice taking place in the Company for appropriate action and reporting, without fear of any kind of discrimination, harassment, victimisation or any other unfair treatment or employment practice being adopted against the whistleblower.
Particulars of Employees & Managerial Remuneration
The required disclosures in accordance with Section 197 of the Act read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended are provided separately and forms part of this report.
CEO and CFO Certification
In accordance with the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Joint Managing Director and Chief Financial Officer of the Company have submitted the relevant certificate for the year ended 31st March, 2018 to the Board of Directors.
Additional Disclosures
The Company had adopted effective from 1st April, 2016, the notified Indian Accounting Standards (Ind AS) and accordingly the Financial Statements (both standalone and consolidated) for the year ended 31st March, 2018 have been prepared under Ind AS. In line with requirements of applicable provisions of law, the Company has made necessary disclosures in respect of Consolidated Financial Statements, Related Party Transactions and Segmental Reporting.
Auditors
In accordance with the provisions of Section 139 of the Act and pursuant to the shareholders approval at the 30th Annual General Meeting,
S.R. Batliboi & Co. LLP, Chartered Accountants (Firm Registration No. 301003E/E300005) has been appointed as Statutory Auditors of the Company to hold office from the conclusion of the 30th Annual General Meeting till the conclusion of the 35th Annual General Meeting of the Company.
Cost Auditors
Pursuant to Section 148 of the Act and Rules made thereunder, the Board has appointed Messers Guha, Ghosh, Kar & Associates, Cost Accountants, to conduct cost audit of the Company for the Financial Year 2017-18 and had recommended their remuneration to the shareholders which was ratified at the Annual General Meeting held on 21st September, 2017.
The Board of Directors have reappointed Messers Guha, Ghosh, Kar & Associates as the Cost Auditors for the Financial Year 2018-19 and their remuneration is sought to be ratified from the shareholders at the forthcoming Annual General Meeting and is included as an agenda item in the Notice convening the 32nd Annual General Meeting.
Secretarial Audit and Corporate Governance Report
During the year under review, the Board of Directors had appointed M/s. A K Labh & Co. firm of Practicing Company Secretaries for conducting secretarial audit in accordance with the provisions of the Act and the Rules framed thereunder. The Secretarial Audit Report is annexed and forms part of this Report.
The Company has complied with the applicable requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and followed the practice of getting disclosures from directors and senior management personnel relating to any material, financial and commercial transactions where they have any personal interest with a potential conflict of interest with the Company at large. A detailed Report on Corporate Governance is annexed and forms part of this Report. The Company has also complied with the Standards of Secretarial Standards 1 & 2 issued by the Institute of Company Secretaries of India as applicable during the year ended 31st March, 2018.
Audit Committee
Members of the Audit Committee as on 31st March, 2018 were Mr. Jitender Balakrishnan as Chairman, Mr. Salil Singhal and Mr. Ghyanendra Nath Bajpai as Members. The Company Secretary acts as the Secretary to the Audit Committee.
All the recommendations of the Audit Committee were duly accepted by the Board and there were no instances of any disagreement between the Committee and Board.
Corporate Social Responsibility (CSR)
The Company has been deeply involved in sustainable development of communities in and around its plants and mines. The CSR policy of the Company is available on www.ushamartin.com/investor. The Companyâs commitment to its responsibilities towards society over the years has never been confined to the requirements of any statute. In accordance with the requirements of the Act, a CSR committee has been constituted, which consists of Mr. B K Jhawar as Chairman, Mr. Brij Kishore Jhawar, Mr. P S Bhattacharyya and Mrs.Aarthi Ramakrishnan as Members. As per the provisions of Section 135 of the Act, the Company need not statutorily incur any social responsibility spending owing to absence of profits over the last three years. However, the annual report on CSR activities as required in accordance with the Act and Rules made thereunder forms part of this Report.
Extract of Annual Return
The details forming part of the extract from the Companyâs Annual Return in Form MGT 9 are annexed separately with this Report.
Number of Meetings of Board and itâs Committees
The details regarding Meetings of the Board and its Committees have been provided in the Corporate Governance Report forming part of this Report.
Particulars of Loans, Guarantees and Investments
The particulars of loans, guarantees or investments are provided in the Financial Statement.
Particulars of contracts or arrangements with Related Parties
During the year under review, in compliance with the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 all related party transactions had been placed before the Audit Committee for approval. Necessary approval of the Board has also been obtained where required. Relevant disclosure has been made in Form AOC-2 pursuant to Rule 8(2) of the Companies (Accounts) Rules, 2014 (as amended) given as an annexure to this Report. The Related Party Transaction Policy as approved by the Board is hosted on the Companyâs website.
Conservation of energy, technology absorption, foreign exchange earnings and outgo
Information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134 (3) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 (as amended) is annexed separately and forms part of this report.
Risk Management
The Company has a Risk Management Committee to assist the Board in discharging its responsibilities towards management of material business risk (material business risks include but is not limited to operational, financial, sustainability, compliance, strategic, ethical, reputational, product quality, human resource, industry, legislative or regulatory and market related risks) including monitoring and reviewing of the risk management plan / policies in accordance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Committee has formulated a Risk Organisation Structure which as part of a risk mapping exercise, reviews risks, identifies ownership of risk, assesses the implication of such risks and the method to mitigate the same. For the year ended 31st March, 2018, the committee consists of Mr. P S Bhattacharyya as Chairman, Mr. Mukesh Rohtagi, Mr. P K Jain and Mr. Rajeev Jhawar as Members.
Appreciation
Your Directors place on record their appreciation for the valuable co-operation and support of its employees, customers, suppliers, contractors, shareholders, investors, Government authorities, financial institutions, banks and other stakeholders.
On behalf of the Board of Directors
Rajeev Jhawar Pravin Kumar Jain
Managing Director Jt. Managing Director
DIN: 00086164 [Wire & Wire Rope Business]
DIN:02583519
Place : Kolkata
Date : 21st May, 2018
Mar 31, 2015
Dear Shareholders,
The Board of Directors of Usha Martin Limited present the 29th Annual
Report and audited accounts for the financial year ended 31st March,
2015. FINANCIAL SUMMARY / HIGHLIGHTS (Rs. in Crores)
Stand alone Consolidated
31st 31 31st 31
march, march, march, march,
2015 2014 2015 2014
Net Sales 3,746.05 3,287.12 4,561.10 4,073.83
Other Income 38.68 77.83 36.99 92.49
Net Sales and Other Income 3,784.73 3,364.95 4,598.09 4,166.32
Profit Before Interest,
Depreciation & Tax (Before
Exceptional Items)
646.38 692.82 753.48 799.43
Depreciation 383.00 303.51 418.42 333.20
Finance Costs 507.39 426.17 521.94 439.56
Profit Before Tax (Before
Exceptional Items) (-)244.01 (-)36.86(-)186.88 26.67
Exceptional Items (-)100.16 - (-)100.16 -
Tax expenses (Current Tax,
Deferred Tax, Net of MAT
Credit Entitlement and
reversal) (-)51.76 (-)11.18 (-)35.64 13.45
Profit After Tax (-) 292.41 (-)25.68 (-)251.40 13.22
Minority Interest - - (-)1.72 (-)2.52
Profit after Tax and Minority
interest - - (-)253.12 10.70
Profit Brought Forward from
Previous Year (-)3.31 22.37 335.17 332.70
Appropriations are made as under:
-Transfer to Capital
Redemption Reserve - - 8.00 8.00
-Proposed Dividend on Equity
Shares and Tax thereon - - 0.21 0.23
- Adjustment arising on
acquisition of controlling
interest in a Joint Venture - - 0.10 -
-Balance Carried Forward
to next year (-)295.72 (-)3.31 73.74 335.17
Review of operations
The turnover for the year increased to Rs. 4561.10 crores on
consolidated basis and Rs. 3746.05 crores on standalone basis from Rs.
4,073.83 crores and Rs. 3,287.12 Crore respectively in the previous
year. Despite there being suboptimal business conditions for steel and
mining industry, the Company could achieve a growth of 12% and 14%
respectively. However, operating profit reduced on consolidated basis
from Rs.799.43 crores in previous year to Rs.753.48 crores in the
current financial year and on standalone basis from Rs.692.81 crores to
Rs.646.38 crores. Consequently operating margins lowered to 16.5% and
17.3% on consolidated and standalone basis respectively.
As per decision of Hon'ble Supreme Court of India which de-allocated
coal mines, there was an additional levy of Rs.83 crores on the
production of coal since beginning of coal mining operations to 31st
March, 2015. This, along with other write downs on investment made in
coal mines amounting to Rs.16.43 crores, has been shown as exceptional
items. The net loss after tax was Rs.253.1 2 crores on consolidated
basis and Rs.292.41 crores on standalone basis for the financial year
2014-15.
The detailed review of operations under steel and wire & wire rope
businesses has been discussed in Management Discussion and Analysis
which forms part of this report.
Dividend & Reserves
In view of there being no profits, the directors are unable to
recommend dividend for the year under review, nor do they propose to
carry any amount to reserves.
outlook and business
During the year there has been a formation of central government with
clear majority after a long period of time in the past. This has
ushered in positive hopes of government taking bold initiatives for
accelerating the process of recovery and growth in business conditions
with enduring sustainability.
However, during the year the steel industry has witnessed lowest
production growth in the recent past and touching as low as 0.5%. The
major segment which consumes the Company's product, i.e automobile, has
also seen mixed conditions. During the 2nd half of the year, the
increased cheaper imports have also created new threats
for the industry.
These difficult conditions in steel industry have also been felt in
wire & wire rope business as well across the global and in domestic
markets.
In September, 2014 the Hon'ble Supreme Court of India de-allocated the
coal mines allotted since 1993 and imposed additional levy @ Rs.295 per
MT on the coal produced since beginning to 31st March, 2015. As a
result, the Company's two coal mines viz. Kathautia and Lohari coal
mines were also de-allocated and the Company had to incur Rs.83 crores
on its' coal production from beginning. Kathautia coal mine was already
operational whereas Lohari coal mine was yet to be made operational.
As a part of subsequent new policy initiatives, the Central Government
decided to allocate coal mines through e-auctions. The Company
participated in these auctions and successfully won Brinda & Sasai coal
block in Jharkhand at a price of Rs.1804 per MT. This coal block is
expected to be commissioned for production in financial year 2017-18.
After completion of cost optimization projects during the previous
financial year, beneficiation and pellet plants were under
stabilization during the current financial year
The manufacturing unit of the Company at Nawalgang, Agra has been
closed down and appropriate steps are being taken to dispose off the
surplus assets lying in the said location.
No material changes and commitments have taken place since close of the
previous financial year and till the date of this report which may
significantly affect the financial position of the Company adversely.
TPM & Quality
Steel Division and Wire Ropes & Speciality Products Division continue
to have certification for its quality management systems being in
accordance with ISO 9001 2000 from BVQI.
The TQM journey of Wire & Wire Rope Division for further strengthening
competitiveness is progressing well to ensure long term benefits to the
Company.
Subsidiaries & Joint Ventures
The international subsidiaries provide significant synergy and support
to the Company's wire rope business and performance. Further, all the
operating subsidiaries of the Company have continued to perform
reasonably well in the economic and business circumstances which
prevailed during the year under review.
The key joint ventures formed by the Company namely, Pengg Usha Martin
Wires Private Limited and Dove Airlines Private Limited have reported
satisfactory results in the year under review.
During the year, Gustav Wolf Specialty Cords Limited, a Joint Venture
of the Company and Usha Martin Power & Resources Limited, a subsidiary
of the Company were converted into wholly owned subsidiary of the
Company.
During the year under review EMM Caspian Limited, a step down
subsidiary of the Company, has been dissolved after strategic review by
the Company.
A statement covering report on the performance and financial position
of each of the subsidiaries, associates and joint venture is provided
separately and forms part of this report.
Environment
Steel Division and Wire Ropes & Speciality Products Division operate
under ISO 14001 Environment Management Systems (EMS) Standards from Det
Norseke Veritas (DNV), of U.K. The effectiveness of these systems is
evident from reduced oil and water consumption, reuse of waste oils and
water, utilization of iron containing wastes.
Wire Rope & Specialty Products Division is driving improvements in
effluent treatment plant to eliminate sludge carry over by
incorporation of filter press, the output of which is being used for
non-critical applications, and continues to target zero discharge
condition. The Division is also focused on reducing air pollution by
converting from oil to LPG and eliminating emission of un-burnt fuels
in atmosphere.
Deposits
During the year the Company has not accepted any deposit under Section
73 of the Companies Act, 2013 and The Companies (Acceptance of
Deposits) Rules, 2014. As on 31st March, 2015, there are no unclaimed
deposits with the Company. Further the Company has not defaulted in
repayment of deposits or payment of interest thereon.
Significant and material orders passed by regulators or courts or
tribunals impacting the going concern status and Company's operations
in future.
During the year no material orders were passed by any regulatory
authority or court which may affect the status of going concern of the
Company.
However, during the year the Hon'ble Supreme Court of India passed
order relating to de - allocation of two coal mines of the Company
namely Kathautia and Lohari Coal blocks. The Kathautia coal block was
in operation since 2010 and up to March 2015.
Details in respect of adequacy of internal financial controls with
reference to the financial statements.
Adequate internal financial controls exist in the Company with
reference to the financial statements. The processes and controls were
subjected to assessment by an independent agency and no reportable
material weakness was observed in the same. However, the Company is in
process of further strengthening the controls and processes.
Corporate Governance
Your Company has complied with requirements of Clause 49 of Listing
Agreement and followed practice of getting disclosures from directors
and senior management personnel relating to any material financial and
commercial transactions where they have any personal interest with a
potential conflict of interest with the Company at large. A detailed
report on Corporate Governance is annexed.
Directors
Mr. B K Jhawar and Mr. Brij K Jhawar are retiring by rotation and offer
themselves for reappointment.
During the year Mr. P S Bhattacharyya was appointed as an Independent
Director on 31st July, 2014 for a period of 5 years and the existing
Independent Directors namely Mr. G N Bajpai, Mr. Jitender Balakrishnan,
Mr. Salil Singhal and Mrs. Ramni Nirula were also appointed for a
period of 5 years w.e.f 31st July, 2014 in accordance with provisions
of the Companies Act, 2013 and the Listing Agreements.
Dr. Vijay Sharma ceased to be a Director with effect from 25th May,
2014, Mr. Nripendra Misra ceased to be a Director with effect from 26th
May, 2014 and Mr. R S Thakur ceased to be a Director with effect from
10th July, 2014.
Details regarding the composition, terms and references, number of
meetings and attendance of respective members of the various sub -
committees of board are provided separately in the Corporate Governance
Report.
Directors' Responsibility Statement
Pursuant to requirements under Section 134 (5) of the Companies Act,
2013 with respect to Directors Responsibility Statement, it is hereby
confirmed that:
(i) the applicable accounting standards have been followed in
preparation of annual accounts for financial year ended 31st March,
2015 and proper explanations have been furnished relating to material
departures;
(ii) the accounting policies have been selected and applied
consistently and prudent judgments and estimates have been made so as
to give a true and fair view of state of affairs of the Company at end
of financial year and of profit/loss of the Company for year under
review;
(iii) proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with provisions of the
Companies Act, 2013 for safeguarding assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) the annual accounts for financial year ended 31st March, 2015 have
been prepared on a going concern basis.
(v) proper internal financial controls were in place and that the
financial controls were generally adequate and operating effectively
except in few cases which were dealt suitably.
(vi) that systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
Manner in which formal annual evaluation has been made by the Board of
its own performance and that of its committees and individual
directors.
Criterions have been formulated for formal evaluation of the individual
directors, Board as a whole and various sub-committees. The directors
evaluated performance of other directors (excepting themselves), the
Board as a whole and its' various sub - committees and provided their
feedback to the Nomination & Remuneration Committee. The Nomination &
Remuneration Committee after reviewing the feedback received from
directors provided its' recommendation to the Board for final
evaluation.
Company's policy on Directors appointment and remuneration including
criteria for determining qualification, positive attributes,
independence of directors.
In accordance with the provisions of Companies Act, 2013 and Clause 49
(as amended), the Board of Directors of the Company on recommendation
of the Nomination and Remuneration Committee have adopted a criteria
for determination of qualification, positive attributes and
independence of directors and Policy for Remuneration of Directors, a
Policy for Remuneration of Senior Management Personnel (including Key
Management Personnel) and a Policy for Remuneration of Other Employees.
The above mentioned Criteria and Policies are available at www.
ushamartin.com/investor.
Vigil Mechanism and Whistle Blower Policy
The Company has adopted a Vigil Mechanism and Whistle Blower Policy to
provide a framework to promote responsible and secure reporting of
undesirable activities ("whistle blowing"). Through this Policy, the
Company seeks to provide a mechanism to all the employees, or directors
of the Company ("whistleblower") to disclose any misconduct,
malpractice, unethical and improper practice taking place in the
Company for appropriate action and reporting, without any fear of any
kind of discrimination, harassment, victimization or any other unfair
treatment or employment practice being adopted against the
whistleblower. The same is available on the Company's website
www.ushamartin.com. Human resource & managerial remuneration The
required disclosures in accordance with Section 197 read with Rule 5 of
Companies (Appointment of Managerial Personnel) Rules 2014 are provided
separately and forms part of this report.
CEo and CFo Certification
In accordance with the provisions of the Clause 49 of the Listing
Agreement, the Managing Director and Chief Financial Officer of the
Company have submitted a certificate for the year ended 31st March,
2015, to the Board of Directors.
Additional Disclosures
In line with requirements of Listing Agreements and Accounting
Standards issued by the Institute of Chartered Accountants of India,
the Company made additional disclosures in respect of Consolidated
Financial Statements, Related Party Transactions and Segmental
Reporting.
Auditors
In accordance with the provisions of Section 139 of the Companies Act,
2013 and the transition period mentioned therein, M/s Price Waterhouse,
Chartered Accountants were appointed as Statutory Auditors of the
Company for a period of two years at the 28th Annual General Meeting of
the Company held on 31st July, 2014 and they will continue in office
upto the conclusion of the 30th Annual General Meeting.
However, in accordance with the provisions of Section 139 of the
Companies Act, 2013, their continuance of office as Auditors shall be
subject to ratification of members at the forthcoming Annual General
Meeting.
Yours Directors invite your attention to note 51 to the accounts
referred to by auditors in para 8 of their report. This note is self
explanatory and along with explanations given therein provide required
clarification on references made by the auditors.
Cost Auditors
Pursuant to Section 148 of the Companies Act, 2013 and Rules made there
under, the Board has appointed M/s. Guha, Ghosh, Kar & Associates, Cost
Accountants, to conduct cost audit of the Company for the year 2014-15
and had recommended their remuneration to the shareholders which was
ratified at the Annual General Meeting held on 31st July, 2014.
The Board of Directors have appointed M/s Guha, Ghosh and Kar as the
Cost Auditors for the financial year 2015-16 and their remuneration is
sought to be ratified from the shareholders at the forthcoming Annual
General Meeting.
Secretarial Auditor
During the year under review the Board of Directors had appointed M/s
Anjan Kumar Roy & Co. firm of Practicing Company Secretaries for
conducting secretarial audit in accordance with the provisions of
Companies Act, 2013 and the rules framed thereunder. The Secretarial
Audit Report is annexed and forms part of this report.
Corporate Social Responsibility
Usha Martin Limited has been constantly involved in sustainable
development of communities around its plants & mines and have also
expanded its CSR activities to the other districts of Jharkhand.
Commitment of founders of Usha Martin towards sustainable development
has led KGVK, an non - profit seeking organization was started as CSR
arm of the Company to reach more than 190 villages of Jharkhand.
In accordance with the provisions of the Companies Act, 2013 the
Company have constituted a Corporate Social Responsibility Committee
which comprises of the following members:
Mr. B K Jhawar - Chairman (Non - executive director)
Mr. Brij K Jhawar - Member (Non - executive director)
Mrs. Ramni Nirula - Member (Independent Director)
The contents of the CSR Policy of the Company and the CSR activities
undertaken by KGVK on behalf of the Company (including the Annual
Report on CSR activities) has been annexed separately and forms part of
this report.
Extract of Annual Return
The details forming part of the extract of the annual return is
enclosed in Form MGT 9.
Number of Meetings of Board and its sub - committees
The details regarding meetings of the Board and its sub - committees
have been provided in the corporate governance report.
Report on the performance and financial position of each of the
subsidiaries, associates and joint ventures.
Analysis of the performance of key subsidiaries and joint ventures has
been provided in the Management Discussion and Analysis section and the
same forms part of this report.
Statement on declaration given by independent directors under Section
149 of the Companies act, 2013
As required under provisions of Companies Act, 2013 and Listing
Agreements, all Independent Directors' of the Company have confirmed
that they meet the criteria of independence.
Particulars of loans, guarantees and investments
The particulars of loans, guarantees or investments are provided in the
Financial Statement.
Particulars of contracts or arrangements with related parties
All related party transactions are entered on arm's length basis and
are in compliance with the applicable provisions of the Companies Act,
2013 and the Listing Agreement. There are no materially significant
related party transactions made by the Company with Promoters,
Directors or Key Managerial Personnel which may have potential conflict
with the interest of the Company at large. Further, as required under
Clause 49 (as amended) of the Listing Agreement, prior omnibus approval
of the Audit Committee has been obtained for transactions with related
parties (other than with wholly owned subsidiaries).
The related party transactions policy as approved by the Board has been
uploaded on the Company's Website.
The details of the transactions with related parties are provided in
Note 48 of the standalone financial statement. Further, the Form AOC -
2 is not attached with this Report as there were no such related party
transactions for which disclosure under Rule 8 of the Companies
(Accounts) Rules, 2014 is required.
Conservation of energy, technology absorption, foreign exchange
earnings and outgo are as follows:
A statement in accordance with the provisions of Section 134 of the
Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules,
2014 is attached separately and forms part of this Report.
Risk Management
During the year under review, a Risk Management Committee as a sub -
committee of the Board was formed with the following directors as
members, to assist the Board in discharging its responsibilities
towards management of material business risk (material business risks
includes but not limited to operational, financial, sustainability,
compliance, strategic, ethical, reputational, product quality, human
resource, industry, legislative or regulatory and market related risks)
including monitoring and reviewing of the risk management plan /
policies in accordance with the provisions of clause 49 of the Listing
Agreements.
Mr. P S Bhattacharyya - Chairman (Independent Director)
Mr. Rajeev Jhawar - Member (Managing Director)
Mr. P K Jain - Member (Jt. Managing Director
[Wire & Wire Rope Business]
Further, as on date there are no additional material risks (apart from
the general market risks) which in the opinion of the Board may
threaten the existence of the Company.
Appreciation
Your directors place on record their appreciation for the valuable co-
operation and support of customers, suppliers, contractors,
shareholders, investors, government authorities, financial
institutions, banks, partners and collaborators.
On behalf of the Board of Directors
p Jhawar
Place: Kolkata Chairman
Date: 25th May, 2015
Mar 31, 2013
Dear Shareholders,
The Board of Directors of your Company takes pleasure in presenting
27th Annual Report and audited accounts of your Company for the
financial year ended 31st March, 2013.
FINANCIAL RESULTS (Rs. in Crs.)
Stand Alone Consolidated
31 March, 31 March, 31 March, 31 March,
2013 2012 2013 2012
Gross Sales including
inter company/division
sales and excise duty 4403.96 3920.16 5516.20 4932.00
Less: Excise Duty 302.45 243.87 313.44 253.92
Less : Inter company/
division sales 1056.98 839.40 1580.93 1317.26
Net Sales excluding
excise duty and inter
company/division sales 3044.53 2836.89 3621.83 3360.82
Other Income 43.22 42.64 89.08 63.94
Net Sales and Other Income 3087.75 2879.53 3710.91 3424.76
Profit Before
Depreciation & Tax 245.56 153.95 367.34 234.11
Depreciation 235.24 197.76 263.84 222.71
Profit Before Tax 10.32 (-)43.81 103.50 11.40
Tax expenses (including
deferred tax) 3.27 (-)11.04 21.24 4.78
Profit After Tax 7.05 (-)32.77 82.26 6.62
Minority Interest (-)3.42 (-)3.01
Profit after Taxation and
Minority interest 78.84 3.61
Profit Brought Forward
from Previous Year 22.67 55.44 267.38 263.86
Appropriations are made
as under:
-General Reserve 2.00 4.08
- Transfer to Capital
Redemption Reserve - - 4.00 -
-Proposed Dividend on
Equity Shares and tax thereon 5.35 5.44 0.09
-Balance Carried Forward
to next year 22.37 22.67 332.70 267.38
REVIEW OF OPERATIONS
The Company''s operating profit increased to Rs. 705.20 Crs. on
consolidated basis and Rs. 572.33 Crs on standalone basis from Rs.
497.77 Crs and Rs. 408.80 Crs respectively. On consolidated basis, the
Company achieved profit after tax and minority interest of Rs. 78.84
Crs against Rs. 3.61 Crs. in previous year On standalone basis, the
profit after tax is Rs. 7.05 Crs against loss of Rs. 32.77 Crs. in the
previous year
The turnover for the year increased to Rs. 3621.83 Crs on consolidated
basis and Rs. 3044.53 Crs on standalone basis against Rs. 3360.82 Crs
and Rs. 2836.89 Crs respectively in the previous year
DIVIDEND
The Board of Directors recommends 15% dividend for the year ended 31st
March, 2013, amounting to Rs. 5.35 Crs including dividend tax,
surcharge and cess.
PROJECTS
The cost optimisation projects undertaken by the Company have
progressed well. The major projects successfully commissioned during
the financial year 12- 13 are 30 MW CPP, Char Beneficiation, DRI-V, 100
TPD Lime Kiln, Beneficiation Plant Phase-1, EBNER annealing furnace and
Fume Exhaust System of SMS-2. The projects, which are under advanced
stage of implementation, namely pellet plant, coke oven, Iron ore
Beneficiation Plant Phase-2, DRI-IV, Waste Heat based 35 MW Captive
Power plant and other related projects are expected to be commissioned
in phases over FY 13-14. Upon completion, these projects would
significantly strengthen cost base, which in turn would enhance
profitability and competitiveness.
BUSINESS OUTLOOK
The adverse economic factors, such as higher level of fiscal deficit,
expanding trade gap, deteriorating current account deficit, rising
inflation and resultant higher interest rates which have caused
industrial slow down and worsened economic environment in the financial
year, continue to prevail with serious challenges to Indian economy
even in current financial year However with the advantage of a higher
level of integration with mineral resources and range of value added
products, the Company is hopeful of performing better in future.
SUBSIDIARIES
The international subsidiaries provide significant synergy and support
to the Company''s business and performance. All the operating
subsidiaries of the Company have continued to perform reasonably well
in the prevailing economic and business conditions during the year
under review.
The facilities of Usha Siam Steel Industries Public Company Limited
[USSIL], a key subsidiary of the Company which was severely affected in
devastating floods in Thailand in October 2011, has resumed normal
operations during the later part of the financial year.
The Statement under Section 212 of the Companies Act, 1956 in respect
of subsidiaries of the Company is given separately.
JOINT VENTURES
All the key joint ventures formed by the Company namely, Pengg Usha
Martin Wires Pvt. Ltd., Gustav Wolf Speciality Cords Ltd. and Dove
Airlines Pvt. Ltd., have done reasonably well in the year under review.
During the year, Usha Siam Steel Industries Public Company Limited
(USSIL) has entered into a Joint Venture Agreement with Tesac Wireropes
Co Ltd (TWCL), Japan for setting up a new joint venture company named
"Tesac Usha Wirerope Co. Ltd. which shall manufacture specialty wire
ropes for elevator and other applications. This new company had been
incorporated under the laws of Thailand. USSIL, along with Usha Martin
Singapore Pte Ltd. a wholly owned subsidiary of the Company, holds 50%
equity in new JV, while the remaining 50% is being held by TWCL.
TPM & QUALITY
Steel Division and Wire Ropes & Speciality Products Division continue
to have certification for its quality management systems being in
accordance with ISO 9001 2000 from BVQI.
Wire & Wire Ropes Division has now embarked on the journey of TQM for
further strengthening competitiveness of the Company.
The operational excellence recognised by these awards and quality
management systems have resulted in tangible improvement in quality,
cost, delivery and safety, besides intangible benefits like motivation
and empowerment at all levels.
ENVIRONMENT
All manufacturing plants of your Company are running in an ecofriendly
manner and have focus on workplace health and safety.
Steel Division and Wire Ropes & Speciality Products Division continue
to enjoy Certification under ISO 14001 Environment Management Systems
(EMS) Standards from Det Norseke Veritas (DNV), of U.K. The
effectiveness of these systems is evident from reduced oil and water
consumption, reuse of waste oils and water, utilization of iron
containing wastes and improved green cover at steel plant site.
Wire Ropes & Speciality Products Division has been achieving
significant improvements in effluent treatment to eliminate sludge
carry over by incorporation of filter press, the output of which is
being used for non-critical applications, and continues to target zero
discharge condition. This Division has also reduced air pollution by
converting from oil to LPG and eliminating emission of un-burnt fuels
in atmosphere.
HUMAN RESOURCES
The Board of Directors expresses its appreciation for sincere efforts
made by employees of your Company at all levels during 2012-13 and
their co-operation in maintaining cordial relations.
Your directors believe and affirm the importance of developing of human
resources, which is valuable and key in achieving all round improvement
and growth.
The information required under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975, forms
part of this Report.
DEPOSITS
As on 31st March, 2013, there are unclaimed deposits of Rs. 1.50 lacs.
CORPORATE GOVERNANCE
Your Company has complied with requirements of Clause 49 of Listing
Agreement and followed practice of obtaining disclosures from directors
and senior management personnel relating to any material financial and
commercial transactions where they have any personal interest with a
potential conflict of interest with the Company at large. Your Company
recognizes importance of good Corporate Governance as a step for
building stakeholders'' confidence, improving investor protection and
enhancing long-term enterprise value.
A detailed report on Corporate Governance is annexed.
DIRECTORS
Mrs Ramni Nirula, Mr G N Bajpai, Mr N Misra and Mr J Balakrishnan are
retiring by rotation and offer themselves for reappointment.
Mr. A K Chaudhri retired by rotation in last annual general meeting.
Your directors place on record their warm appreciation for the
contribution made by him in progress and growth of the Company.
Mr R S Thakur has been appointed as an additional director on the Board
of the Company with effect from 30th January, 2013. He will hold office
up to the date of ensuing Annual General Meeting. Your Directors
recommend his appointment at the forthcoming Annual General Meeting in
respect of which notice under Section 257 of the Companies Act, 1956
has been received.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to requirements under Section 217 (2AA) of the Companies Act,
1956 with respect to Directors Responsibility Statement, it is hereby
confirmed that:
(i) the applicable accounting standards have been followed in
preparation of annual accounts for financial year ended 31st March,
2013 and proper explanations have been furnished relating to material
departures;
(ii) the accounting policies have been selected and applied
consistently and reasonably and prudent judgments and estimates have
been made so as to give a true and fair view of state of affairs of the
Company at end of financial year and of profit of the Company for year
under review;
(iii) the proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with provisions of the
Companies Act, 1956 for safeguarding assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) the annual accounts for financial year ended 31st March, 2013 have
been prepared on a going concern basis.
CEO / CFO CERTIFICATION
The Managing Director and Chief Financial Officer of the Company
submitted a certificate to Board of Directors as required under Clause
49 of Listing Agreement for the year ended 31st March, 2013.
ADDITIONAL DISCLOSURES
In line with requirements of Listing Agreements and Accounting
Standards issued by the Institute of Chartered Accountants of India,
your Company made additional disclosures in respect of Consolidated
Financial Statements, Related Party Transactions and Segmental
Reporting.
AUDITORS
The auditors, M/s. Price Waterhouse, Chartered Accountants, retire at
conclusion of forthcoming Annual General Meeting and being eligible,
have offered themselves for re-appointment.
COST AUDITORS
During the year, Board appointed M/s. Guha, Ghosh, Kar & Associates,
Cost Accountants, to conduct cost audit of the Company. The Company
filed application with Central Government for financial year 2012-13
for appointment of Cost Auditor and the approval is deemed to have been
received.
ENERGY CONSERVATION
As required under Section 217(1 )(e) of the Companies Act, 1956,
details regarding conservation of energy, technology absorption and
foreign exchange earning and outgo are given in the Annexure attached
hereto and form part of this Report.
CORPORATE SOCIAL RESPONSIBILITY
Your Company has always been committed to its'' responsibility to the
society and accordingly has accorded very high priority and commitment
towards discharge of the same.
USSIL was awarded TLS 8001-2010 Certificate for having achieved
requirements of Thai Corporate Social Responsibility by Ministry of
Labour, Royal Thai Government.
A detailed report on initiatives in this regard is attached and forms
part of this report.
APPRECIATION
Your directors place on record their appreciation for valuable
co-operation and support of customers, suppliers, contractors,
shareholders, investors, government authorities, financial
institutions, banks, partners and collaborators.
On behalf of the Board of Directors
Kolkata P JHAWAR
9th May 2013 Chairman
Mar 31, 2012
The Board of Directors of your Company takes pleasure in presenting
26th Annual Report and audited accounts of your Company for the
financial year ended 31st March, 2012.
(Rs. in Cr.)
Financial
31 March, 31 March, 31 March, 31 March,
2012 2011 2012 2011
Gross Sales
including inter
company/division
sales and excise
duty 3920.16 3475.71 4932.00 4406.66
Less: Excise Duty 243.87 215.53 253.92 221.83
Less : Intercompany/
division sales 839.40 735.47 1317.26 1140.24
Net Sales excluding
excise duty and inter
company/
division sales 2836.89 2524.71 3360.82 3044.59
Other Income 42.64 48.81 63.94 43.02
Net Sales and
Other Income 2879.53 2573.52 3424.76 3087.61
Profit Before
Depreciation & Tax 153.95 321.79 234.11 405.03
Depreciation 197.76 176.49 222.71 200.96
Profit Before Tax (-)43.81 145.30 11.40 204.07
Tax expenses
(including
deferred tax) (-)11.04 45.77 4.78 64.04
Profit After Tax (-)32.77 99.53 6.62 140.03
Minority Interest (-)3.01 (-)3.00
Profit after Taxation
and Minority interest 3.61 137.03
Profit Brought Forward
from Previous Year 55.44 41.11 263.86 212.14
Appropriations are
made as under:
-General Reserve 50.00 50.01
Transfer to Capital
Redemption Reserve
-Proposed Dividend on
Equity Shares and tax
thereon 35.20 0.09 35.30
-Balance Carried
Forward
to next year 22.67 55.44 267.38 263.86
Review of Operations
During the financial year 2011-12, the Company has faced challenges of
high cost of inputs which could not be passed on to customers due to
difficult business environment. In addition, Usha Siam Steel Industries
Public Company Limited, a subsidiary of the Company remained out of
operation for sizeable part in second half of year due to unprecedented
floods in Thailand.
As a result, the Company's operating profit reduced to Rs.497.76 Crs.
on consolidated basis and Rs.408.80 Crs on standalone basis from
Rs.595.03 Crs and Rs.504.05 Crs respectively. The impact on profit
before and after tax was even more severe. On consolidated basis, the
Company could achieve profit after tax and minority interest of Rs.3.61
Crs. against Rs.137.03 Crs. in previous year. On standalone basis,
there was loss after tax of Rs.32.77 Crs against profit after tax of
Rs.99.53 Crs. in the previous year.
The turnover, however, increased to Rs.3360.82 Crs on consolidated
basis and Rs.2836.89 Crs on standalone basis during the year against
Rs.3044.59 Crs and Rs.2524.71 Crs respectively in the previous year.
Dividend
Under the circumstances, the Board of Directors express their inability
to recommend payment of any dividend to shareholders for the year ended
31st March, 2012.
Projects
The capex plans undertaken by the Company to further perpetuate the
advantage of cost competiveness are under various stages of
implementation and are expected to be commissioned in phases over FY
2012-13 and 2013-14. The projects under implementation include
pelletisation plant, coke oven, 2 DRI plants and Waste Heat based 65 MW
Captive Power plants and other related projects. Upon completion, these
projects would significantly strengthen cost base, which in turn would
enhance profitability and competitiveness.
Business Outlook
The business conditions continue to remain sub-optimal amidst global
and domestic challenges. While in inflationary economy, costs may rise
further, uncertain business environment (which disturbs chain of
economic activities) reduces ability to resist against such adverse
pressures. However, the Company believes that with the hope of
Government taking suitable initiatives to restore confidence and
environment conducive for growth, the inherent advantages of business
model, would enable the Company to improve its performance in FY 12-13
and subsequent years.
Subsidiaries
The international subsidiaries provide significant synergy and support
to the Company's business and performance. All the operating
subsidiaries of the Company have continued to perform reasonably well
during the year under review.
The facilities of Usha Siam Steel Industries Public Company Limited
[USSIL], a key subsidiary of the Company became in-operational due to
unprecedented floods in Thailand in October'11 which inundated all
major industrial areas of Thailand for over 2 months. The Navanakorn
Industrial Area, where USSIL's facilities are located, had water
accumulation of more than 6 ft. The industrial activities and other
operations suffered for over 4 months. After receding of water, the
restoration of normalcy in industrial activities is still under way in
other parts, USSIL could start partial operations in February'12. Full
level of activities are expected to be resumed by second quarter of FY
12-13. The insurance policy taken by USSIL covers consequential losses
to assets and profits out of flood and other perils.
The Statement under Section 212 of the Companies Act, 1956 in respect
of subsidiaries of the Company is given separately.
Joint Ventures
All the key joint ventures formed by the Company namely, Pengg Usha
Martin Wires Pvt. Ltd., Gustav Wolf Specialty Cords Ltd. and Dove
Airlines Pvt. Ltd., have done reasonably well in the year under review.
TPM & Quality
The Company attaches high importance to quality and TPM in all its
operations for achieving tangible and intangible benefits to ensure
operational excellence.
Steel Division and Wire Ropes & Specialty Products Division continue
to have certification for its quality management systems being in
accordance with ISO 9001 2000 from BVQI.
Both Steel Division & Wire Ropes and Specialty Products Division had
received consistency awards for Total Productive Maintenance from JIPM.
Environment
All manufacturing plants have a focus on workplace health and safety.
Steel Division and Wire Ropes & Specialty Products Division continue
to enjoy Certification under ISO 14001 Environment Management Systems
(EMS) Standards from Det Norseke Veritas (DNV), of U.K. The
effectiveness of these systems is evident from reduced oil and water
consumption, reuse of waste oils and water, utilization of iron
containing wastes and improved green cover in steel plant site.
Wire Rope & Specialty Products Division has been achieving significant
improvements in effluent treatment plant to eliminate sludge carry over
by incorporation of filter press, the output of which is being used for
non critical applications, and continues to target zero discharge
condition. This Division has also reduced air pollution by converting
from oil to LPG and eliminating emission of un-burnt fuels in
atmosphere.
Human Resources
The Board of Directors express their appreciation for sincere efforts
made by employees of your Company at all levels during 2011-12 and
their co-operation in maintaining cordial relations.
Your directors believe and affirm importance of development of human
resources, which is most valuable and key element in bringing all round
improvement and achieving growth of business.
USSIL, subsidiary of the Company, was awarded 'Outstanding
Establishment on Labour Relation & Welfare' by Ministry of Labour,
Royal Thai Government for the years 2008, 2009, 2010 and 2011.
The information required under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975, forms
part of this Report.
Deposits
As on 31st March, 2012, there are unclaimed deposits of Rs.0.04 Crs.
Corporate Governance
Your Company has complied with requirements of Clause 49 of Listing
Agreement and followed practice of getting disclosures from directors
and senior management personnel relating to any material financial and
commercial transactions where they have any personal interest with a
potential conflict of interest with the Company at large. Your Company
recognizes importance of good Corporate Governance as a step for
building stakeholders' confidence, improving investor protection and
enhancing long-term enterprise value.
A detailed report on Corporate Governance is annexed.
Directors
Mr. B K Jhawar, Mr Brij K Jhawar, Mr P K Jain and Mr A K Chaudhri are
retiring by rotation.
Mr. A K Basu retired by rotation in last annual general meeting. Your
directors place on record their warm appreciation for contribution made
by him in progress and growth of the Company, During the year, Dr P
Bhattacharya, Jt Managing Director retired from the services of the
Company on attaining the age of superannuation. Your directors place
on record their warm appreciation for contribution made by him in
progress and growth of the Company, With effect from 1st February,
2012, Dr. Vijay Sharma and Mr. P K Jain, Executive Directors were
designated as Jt. Managing Director [Steel Business] and Jt. Managing
Director [Wire & Wire Ropes Business] respectively.
Directors' Responsibility Statement
Pursuant to requirements under Section 217 (2AA) of the Companies Act,
1956 with respect to Directors Responsibility Statement, it is hereby
confirmed that:
(i) the applicable accounting standards have been followed in
preparation of annual accounts for financial year ended 31st March,
2012 and proper explanations have been furnished relating to material
departures ;
(ii) the accounting policies have been selected and applied
consistently and reasonably except to the extent of change in
Accounting Policy mentioned hereinafter, and prudent judgments and
estimates have been made so as to give a true and fair view of state of
affairs of the Company at end of financial year and of profit of the
Company for year under review ;
(iii) the proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with provisions of the
Companies Act, 1956 for safeguarding assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) the annual accounts for financial year ended 31st March, 2012 have
been prepared on a going concern basis.
Accounting Policy
During the year, there has been a sharp depreciation in value of INR
against US $ and other global currencies. Recognizing severity of the
impact, Ministry of Corporate Affairs has amended AS-11, allowing an
option to corporate to account for change in value of long term loans
to respective fixed assets and depreciate over life of such assets if
the loan is for acquisition of fixed assets, and in case of other
loans, to Foreign Currency Monetary Item Translation Difference Account
and amortize over balance period of liability. The Company has decided
to exercise this option and accordingly there has been a change in
Accounting Policy,
CEO / CFO Certification
The Managing Director and Chief Financial Officer of the Company
submitted a certificate to Board of Directors as required under Clause
49 of Listing Agreement for the year ended 31st March, 2012.
Additional Disclosures
In line with requirements of Listing Agreements and Accounting
Standards issued by the Institute of Chartered Accountants of India,
your Company made additional disclosures in respect of Consolidated
Financial Statements, Related Party Transactions and Segmental
Reporting.
Auditors
The auditors, M/s. Price Waterhouse, Chartered Accountants, retire at
conclusion of forthcoming Annual General Meeting and being eligible,
have offered themselves for re- appointment.
Your directors invite your attention to note 41 to the accounts,
referred to by Auditors in para 4 of their report. These notes are
self explanatory and along with explanations given hereinabove under
respective heads, provide required clarifications on references made by
Auditors.
Cost Auditors
During the year, Board appointed M/s. Guha, Ghosh, Kar & Associates,
Cost Accountants, to conduct cost audit of the Company. The Company
filed application with Central Government for financial year 2011-12
for appointment of Cost Auditor and the approval is deemed to have been
received.
Energy Conservation
As required under Section 217(1)(e) of the Companies Act, 1956, details
regarding conservation of energy, technology absorption and foreign
exchange earning and outgo are given in the Annexure attached hereto
and form part of this Report.
Corporate Social Responsibility
Your Company has always been alive to its' responsibility to the
society and accordingly been giving very high priority and commitment
towards discharge of the same.
USSIL was awarded TLS 8001-2010 Certificate for having achieved
requirements of Thai Corporate Social Responsibility by Ministry of
Labour, Royal Thai Government.
A detailed report on various initiatives in this regard is attached and
forms part of this Report.
Appreciation
Your directors place on record their appreciation for valuable
co-operation and support of customers, suppliers, contractors,
shareholders, investors, government authorities, financial
institutions, banks, partners and collaborators.
On behalf of the Board of Directors
Kolkata P Jhawar
10th May 2012 Chairman
Mar 31, 2011
The Board of Directors of your Company takes pleasure in presenting
25th Annual Report and audited accounts of your Company for the
financial year ended 31st March, 2011.
Financial Results
Stand Alone Consolidated
31 March, 31 March, 31 March, 31 March,
2011 2010 2011 2010
Gross Sales including
inter company/division
sales and excise duty 3477.70 2553.77 4389.35 3604.32
Less: Excise Duty 215.53 109.64 221.83 115.92
Less : Inter company/
division sales 735.47 593.74 1120.95 973.99
Net Sales excluding
excise duty and inter
company/division sales 2526.70 1850.39 3046.57 2514.41
Other Income 27.28 20.16 20.58 25.51
Net Sales and Other
Income 2553.98 1870.55 3067.15 2539.92
Profit Before
Depreciation & Tax 321.79 246.46 405.03 369.51
Depreciation 176.49 107.25 200.96 129.47
Profit Before Tax 145.30 139.21 204.07 240.04
Tax expenses (including
deferred tax) 45.77 47.00 64.04 68.52
Profit After Tax 99.53 92.21 140.03 171.52
Minority Interest - - (3.00) (2.90)
Profit after Taxation
and Minority interest - - 137.03 168.62
Profit Brought Forward
from Previous Year 41.12 34.36 212.14 132.08
Appropriations are made
as under:
-General Reserve 50.00 50.00 50.01 50.00
-Transfer to Capital
Redemption Reserve - - - 3.00
-Proposed Dividend on
Equity Shares and tax
thereon 35.21 35.45 35.30 35.55
-Balance Carried
Forward to next year 55.44 41.12 263.86 212.14
Dividend
The Board of Directors recommends a dividend, Re 1 per share (100%) on
the equity shares of the Company for year ended 31st March 2011,
amounting to Rs 35.21 cr. including dividend tax, surcharge and cess.
Review of Operations
During 2010-11, your Company recorded a growth of 36.6% by achieving
net turnover of Rs. 2526.70 cr. as against Rs. 1850.39 cr. in previous
year. Gross profit achieved during the year was also higher by 38.0% at
Rs. 496.02 cr. against Rs. 359.49 cr. in the previous year. The gross
sales before adjustment of inter divisional sales were Rs. 3477.70 cr.,
which is higher by 36.2% over that in previous year.
The Company achieved profit before tax of Rs. 145.30 cr. and net
profit of Rs. 99.53 cr. as against Rs. 139.21 cr. and Rs.92.21 cr. in
2009-10, recording increase of 4.4% and 7.9% respectively.
The collective turnover of subsidiaries (without inter-
company/division sales) was however lower by 13.2% at Rs. 911.64 cr.
against that in previous year of Rs. 1050.55 cr. in previous year.
At consolidated level, net turnover (net of excise duty and
inter-company/division sales) stood at Rs. 3046.57 cr. against Rs.
2514.41 cr. in 2009-10. Consolidated gross profit increased by 18.6% to
Rs. 587.31 cr. However, profit before tax and profit after tax
decreased by 15.0% and 18.4% to Rs. 204.07 cr. and Rs. 140.03 cr.
respectively.
Projects
The capex plans undertaken by the Company for strengthening its
advantage of cost competitiveness, are progressing satisfactorily and
are expected to be commissioned in phases over FY 2011-12 and 2012-13.
The projects under implementation include setting up of captive
facilities namely pellet plant, coke oven plant, additional DRI and
power plants and balancing facilities in Steel and Wire & Wire Ropes
Divisions.
Business Outlook
While domestic economic conditions have restored to an extent from down
turn and global economy is also showing signs of possible recovery,
higher input prices and rising inflation, coupled with volatility in
prices of finished goods due to external competitive pressures, may
have impact on profitability in the sector and segments the Company
operates. However with the advantage of reasonably higher level of
integration with mineral resources and range of value added products,
your directors are confident of the Company performing relatively
better in near future.
Subsidiaries
All the operating subsidiaries of the Company have continued to perform
well during the year under review. The international subsidiaries
provide significant synergy and support to the Companys business and
performance.
Usha Martin International Ltd. and Usha Martin Singapore Pte Ltd.
wholly owned subsidiaries of the Company have given interim dividends
of Rs. 10.57 cr. and Rs. 3.52 cr. respectively during the year under
review. Brunton Wolf Wire Ropes FZCO, the Joint Venture of the Company,
has given a dividend of Rs. 2.41 cr. during the year under review. U M
Cables Ltd. another wholly owned subsidiary of the Company, has also
paid dividend of Rs. 0.58 cr. on its outstanding preference shares
allotted to and entirely held by the Company.
The Statement under Section 212 of the Companies Act, 1956 in respect
of subsidiaries of the Company is annexed to this Report.
Joint Ventures
All the key joint ventures formed by the Company namely, Pengg Usha
Martin Wires Pvt. Ltd., Gustav Wolf Speciality Cords Ltd. and Dove
Airlines Pvt. Ltd., have done reasonably well in the year under review.
TPM & Quality
After getting TPM Excellence Award, Wire Ropes and Speciality Products
Division received award for Excellence in Consistent TPM Commitment,
from the Japan Institute of Plant Maintenance [JIPM] during 2009-10.
Now Wire Ropes and Speciality Products Division plan to go on for
Deming Award.
Steel Division of the Company, has already received Excellence and
Consistency awards for total productive maintenance from JIPM.
Steel Division and Wire Ropes & Speciality Products Division continue
to have certification for its quality management system being in
accordance with ISO 9001 2000 from BVQI.
The operational excellence recognised by these awards and quality
management systems have resulted in tangible improvement in quality,
cost, delivery and safety, besides intangible benefits like motivation
and empowerment amongst grass root levels.
Environment
All manufacturing plants of your Company are running in an eco-friendly
manner and have a focus on workplace health and safety.
Steel Division and Speciality Products Divisions continue to enjoy
Certification under ISO 14001 Environment Management Systems (EMS)
Standards from Det Norseke Veritas (DNV), of U.K. The effectiveness of
these systems is evident from reduced oil and water consumption, reuse
of waste oils and water, utilization of iron containing wastes and
improved green cover in steel plant site.
Wire Rope & Speciality Products Division has been achieving significant
improvements in effluent treatment plant to eliminate sludge carry over
by incorporation of filter press, the output of which is being used for
non critical applications and continues to target zero discharge
condition. This Division has also reduced air pollution by converting
from oil to LPG and eliminating emission of unburnt fuels in
atmosphere.
Human Resources
The Board of Directors expresses its appreciation for sincere efforts
made by employees of your Company at all levels during 2010-11 and
their co-operation in maintaining cordial relations.
Your directors believe and affirm importance of development of human
resources, which is most valuable and key element in bringing all round
improvement and achieving growth of business.
The information required under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975, forms
part of this Report.
Deposits
As on 31st March, 2011, there are unclaimed deposits of Rs. 0.08 cr.
Corporate Governance
Your Company has complied with requirements of Clause 49 of Listing
Agreement and followed practice of getting disclosures from directors
and senior management personnel relating to any material financial and
commercial transactions where they have any personal interest with a
potential conflict with interest of the Company at large. Your Company
recognizes importance of good Corporate Governance as step for building
stakeholders confidence, improving investor protection and enhancing
long-term enterprise value.
A detailed report on Corporate Governance is annexed.
Directors
Mr. P Jhawar, Mr. A K Basu, Mr. S Singhal and Dr. Vijay Sharma are
retiring by rotation.
Mr. N J Jhaveri retired by rotation in last annual general meeting.
Your directors place on record their warm appreciation for contribution
made by him in progress and growth of the Company.
During the year under review, Mr. Jitender Balakrishnan was inducted as
Director in Board of Directors of the Company. The Board appointed him
as Chairman of the Audit Committee, filling up vacancy caused by
retirement of Mr. N J Jhaveri.
Subsequent to resolution passed by the shareholders in Annual General
Meeting held on 27th July, 2010, for payment of commission to Mr.
Prashant Jhawar @ 1.5% of net profits of the Company for each of five
financial years commencing from 1st April, 2010, approval from Central
Government has since been received.
Directors Responsibility Statement
Pursuant to requirements under Section 217 (2AA) of the Companies Act,
1956 with respect to Directors Responsibility Statement, it is hereby
confirmed that:
(i) the applicable accounting standards have been followed in
preparation of annual accounts for financial year ended 31st March,
2011 and proper explanations have been furnished relating to material
departures;
(ii) the accounting policies have been selected and applied
consistently and reasonably and prudent judgments and estimates have
been made so as to give a true and fair view of state of affairs of the
Company at end of financial year and of profit of the Company for year
under review;
(iii) the proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with provisions of the
Companies Act, 1956 for safeguarding assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) the annual accounts for financial year ended 31st March, 2011 have
been prepared on a going concern basis.
CEO / CFO Certification
The Managing Director and Chief Financial Officer of the Company
submitted a certificate to Board of Directors as required under Clause
49 of Listing Agreement for the year ended 31st March, 2011.
Additional Disclosures
In line with requirements of Listing Agreements and Accounting
Standards issued by the Institute of Chartered Accountants of India,
your Company made additional disclosures in respect of Consolidated
Financial Statements, Related Party Transactions and Segmental
Reporting.
Auditors
The auditors, M/s. Price Waterhouse, Chartered Accountants, retire at
conclusion of forthcoming Annual General Meeting and being eligible,
have offered themselves for re- appointment.
Cost Auditors
During the year, Board appointed M/s. Guha, Ghosh, Kar & Associates,
Cost Accountants, to conduct cost audit of the Company. The Company has
already received approval from the Central Government for financial
year 2010-11.
Energy Conservation
As required under Section 217(1)(e) of the Companies Act, 1956, details
regarding conservation of energy, technology absorption and foreign
exchange earning and outgo are given in the annexure attached hereto
and form part of this Report.
Corporate Social Responsibility
Your Company has always been aware about its responsibility to the
society and accordingly been giving very high priority and commitment
towards discharge of the same.
A detailed report on various initiatives in this regard is attached and
forms part of this report.
Appreciation
Your directors place on record their appreciation for valuable
co-operation and support of customers, suppliers, contractors,
shareholders, investors, government authorities, financial
institutions, banks, partners and collaborators.
On behalf of the Board of Directors
Kolkata P Jhawar
11th May 2011 Chairman
Mar 31, 2010
The Board of Directors of your Company takes pleasure in presenting
24th Annual Report and audited accounts of your Company for the
financial year ended 31st March, 2010
Financial Results (Rs. in cr.)
Standalone Consolidated
31st March, 31st March, 31st March, 31st March,
2010 2009 2010 2009
Gross sales including
inter Company/division
sales and excise duty 2,553.77 3,085.33 3,604.32 4,499.41
Less: Excise duty 109.64 179.98 115.92 196.95
Less : Inter Company/
division sales 593.74 778.12 973.99 1,352.61
Net sales excluding
excise duty and inter
Company/division sales 1,850.39 2,127.23 2,514.41 2,949.85
Other Income 20.16 13.53 25.51 17.63
Net sales and other
income 1,870.55 2,140.76 2,539.92 2,967.48
Profit before
depreciation and tax 246.46 299.08 369.51 389.21
Depreciation 107.25 85.04 129.47 108.62
Profit before tax 139.21 214.04 240.04 280.59
Provision for tax
(including deferred tax
and FBT) 47.00 67.48 68.52 92.24
Profit after tax 92.21 146.56 171.52 188.35
Minority interest - - (2.90) (3.01)
Profit after taxation
and minority interest - - 168.62 185.34
Profit brought forward
from previous year 34.36 42.08 132.08 101.11
Appropriations are made
as under:
- General Reserve 50.00 125.00 50.00 125.00
- Transfer to Capital
Redemption Reserve - - 3.00 -
- Proposed dividend on
equity shares and tax
thereon 35.45 29.28 35.55 29.38
- Balance carried
forward to next year 41.12 34.36 212.15 132.08
Dividend
The Board of Directors recommends a dividend, Re 1 per share (100%) on
the equity shares of the Company for year ended 31st March, 2010,
amounting to Rs. 35.45 cr. including dividend tax, surcharge and cess @
16.995%.
Review of Operations
The 2009-10 continued to witness economic volatility in domestic and
global markets. As a result, business of your Company was adversely
affected in comparison with its performance in the previous financial
year. However, recent recovery in economic conditions and in steel
sector are positive for the Company.
During 2009-10, your Company achieved net turnover of Rs. 1,850.39 cr
as against Rs. 2,127.23 cr in 2008-09, lower by 13.00%. The gross sales
before adjustment of inter divisional sales were Rs. 2,553.77 cr,
registering a decline of 17.20% over 2008-09.
The Company achieved profit before tax of Rs. 139.21 cr as against Rs.
214.04 cr, lower by 35.00% and net profit of Rs. 92.21 cr, as against
Rs. 146.56 cr in 2008-09, lower by 37.10%.
The collective turnover of subsidiaries (without inter Company/division
sales) stood at Rs. 1,050.55 cr, which is lower by 25.70% over 2008-09.
The consolidated net turnover (net of excise duty and inter
Company/division sales) decreased 14.80% to Rs. 2,514.41 cr. The
consolidated profit before tax and profit after tax decreased by 14.50%
and 9.01% to Rs. 240.04 cr and Rs. 168.62 cr, respectively.
The Company voluntarily adopted Accounting Standard (AS)-30 "Financial
Instruments; Recognition and Measurements" with effect from 1st April,
2009 to account for derivative contracts to the extent such adoption
does not conflict with the existing Accounting Standards, Companies Act
and other regulatory requirements. The modified accounting policy has
been disclosed suitably under head ÃSignificant Accounting Policiesà in
the accounts.
Projects
The projects undertaken by the Company have been successfully
commissioned barring Mini Blast Furnace, Sinter Plant and 20 MW Captive
Power Plants which are expected to be commissioned during current
financial year. The cost of projects which were commissioned during
year under review is Rs. 1,234.33 cr. and the Company has incurred net
trial run expenses amounting to Rs. 40.16 cr. In view of large number
of projects being under implementation at steel plant at Jamshedpur and
practical difficulties involved in carrying out scheduled physical
verification of fixed assets, it was considered prudent to postpone
same by one year. The Company also started operations at coal mine
during year under review.
The Board has further approved a capital expenditure plan of Rs.
1,200.00 cr. largely aimed to further strengthen itsà cost
competitiveness by setting up captive facilities namely a pellet plant,
a coke oven plant, additional DRI and power plants and some balancing
facilities in Steel and Wire & Wire Rope Divisions. The capex plan is
expected to be completed in a period of 36 months.
Business Outlook
After having gone through significant downturn in business activity,
stability was witnessed in most sectors with support of government
spending and intervention, by end of financial year under review. The
conditions are expected to remain stable before improving, assuming
positive policies continuing from government and confidence level gets
restored in global markets.
Given expected improvement in business conditions, completion of
projects, expansion of capacity for making steel, higher integration
with mineral resources and value added products, and consolidation of
the CompanyÃs position as special steel producer are expected to enable
the Company to do reasonably well in financial performance in first
quarter of current financial year and onwards.
Subsidiaries
The Company continues to get significant synergy and support from its
overseas investments resulting into impressive growth in turnover and
financial performance.
Usha Martin Singapore Pte. Limited [UMSPL], a wholly owned subsidiary
of the Company, was allotted a plot of land by Government of Singapore.
UMSPL has constructed about 70,000 sq. ft. space to accommodate
warehousing facilities which have become operational in April, 2010.
During year under review, P. T. Usha Martin Indonesia, a Company
incorporated in Indonesia, has been formed as wholly owned subsidiary
of UMSPL.
Also, during year under review, Bharat Minex Private Limited has been
made a wholly owned subsidiary of the Company, after buying out 50%
equity stake earlier held by joint venture partner namely BHP Minerals
Holding Pty Ltd.
Brunton Shaw Americas Inc, a wholly owned subsidiary of the Company has
been merged with Usha Martin Americas Inc, (UMAI) another wholly owned
subsidiary of the Company, w.e.f. 1st April, 2009.
U M Cables Ltd. (UMCL), wholly owned subsidiary of the Company, has
declared dividend of Rs. 0.64 cr. on its outstanding preference shares
allotted to and entirely held by the Corporate. Also, during the year
UMCL has redeemed part of its preference share capital amounting to
Rs. 3.00 cr. by creating Capital Redemption Reserve out of its
profits.
The Statement under Section 212 of the Companies Act, 1956 in respect
of subsidiaries of the Company is annexed to this Report. The Company
received, vide letter No. 47/270/2010- CL-III dated 22nd April, 2010,
approval from Ministry of Corporate Affairs, Government of India, for
exemption from annexing accounts and other documents pertaining to
subsidiaries, under Section 212(8) of the Companies Act, 1956.
Joint Ventures
The joint ventures formed by the Company namely, Pengg Usha Martin
Wires Pvt. Ltd., with Joh Pengg AG of Austria and CCL Usha Martin
Stressing Systems Ltd., with CCL group of UK continue to remain
affected due to volatile business during year under review. With
improvement in business conditions these joint ventures are expected to
be doing reasonably better. The joint ventures with M/s Gustav Wolf
Seil-und Drahtwerke GmbH & Co. of Germany, namely Gustav Wolf Specialty
Cords Ltd., in which the Company holds 49% equity, and with EMTA group
of Kolkata namely Dove Airlines Pvt. Ltd., in which the Company holds
50% equity, have done reasonably well in the year under review.
Bharat Minex Private Limited, another joint venture of the Company with
BHP Minerals Holdings Pty Ltd. (a subsidiary of BHP Billiton Ltd.) of
Australia in which both parties held 50% stake has been made a wholly
owned subsidiary of the Company after BHP BillitonÃs decision to
withdraw from this joint venture and selling entire holding to the
Company.
Capital
During 2009-10, the Company successfully issued and allotted
5,45,00,000 equity shares of Re. 1 each at a price of Rs. 85.90 per
equity share aggregating to Rs. 468.15 cr to qualified institutional
buyers.
TPM and quality
After getting TPM Excellence Award, wire ropes and speciality products
division received award for excellence in consistent TPM commitment,
from the Japan Institute of Plant Maintenance [JIPM] during 2009-10.
Now wire ropes and speciality products division plans to implement
third phase of TPM Excellence Award.
Steel division of the Company, has already received excellence and
consistency awards for total productive maintenance from JIPM.
Steel division and wire ropes and speciality products division continue
to have certification for its quality management system being in
accordance with ISO 9001 2000 from BVQI.
The operational excellence recognised by these awards and quality
management systems have resulted in tangible improvement in quality,
cost, delivery and safety, besides intangible benefits like motivation
and empowerment amongst grass root levels.
Environment
All manufacturing plants of your Company are running in an eco-
friendly manner and have a focus on workplace health and safety.
Steel and speciality products divisions continue to enjoy certification
under ISO 14001 Environment Management Systems (EMS) standards from Det
Norseke Veritas (DNV), of UK. The effectiveness of these systems is
evident from reduced oil and water consumption, reuse of waste oils and
water, utilisation of iron containing wastes and improved green cover
in steel plant site.
Wire rope and specialty products division has been achieving
significant improvements in effluent treatment plant to eliminate
sludge carry over by incorporation of filter press, the output of which
is being used for non-critical applications, and continues to target
zero discharge condition. This Division has also reduced air pollution
by converting from oil to LPG and eliminating emission of unburnt fuels
in atmosphere.
Human resources
The Board of Directors expresses its appreciation for sincere efforts
made by employees of your Company at all levels during 2009-10 and
their cooperation in maintaining cordial relations. Your Directors
believe and affirm importance of development of human resources, which
is most valuable and key element in bringing all round improvement and
achieving growth of business.
The information required under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975, forms
part of this Report.
Deposits
As on 31st March, 2010, there are unclaimed deposits of Rs.0.11 cr.
Corporate Governance
Your Company recognizes importance of good Corporate Governance as step
for building stakeholdersà confidence, improving investor protection
and enhancing long-term enterprise value.
The equity shares continue to remain listed at Bombay Stock Exchange
Ltd., National Stock Exchange of India Ltd. and GDRs at Societe de la
Bourse de Luxembourg.
Your Company has been complying with requirements of Clause 49 of
Listing Agreement and has also followed practice of getting disclosures
from Directors and senior management personnel relating to any material
financial and commercial transactions where they have any personal
interest with a potential conflict with interest of the Company at
large.
A detailed report on Corporate Governance is annexed.
Directors
Mr. B .K. Jhawar, Mr. Brij K. Jhawar, Mr. A. K. Chaudhri and Mr. N. J.
Jhaveri are retiring by rotation.
Mrs. Ramni Nirula, Dr. Vijay Sharma, Mr. P. K. Jain, Mr. G. N. Bajpai
and Mr. N. Misra have been appointed as additional Directors on Board
of the Company with effect from 14th January, 2010, 1st February, 2010,
1st February, 2010, 18th March, 2010 and 22nd March, 2010 respectively.
They will hold office up to the date of ensuing Annual General Meeting.
With effect from 1st February, 2010, Dr. Vijay Sharma and Mr. P. K.
Jain have also been appointed as Executive Director & Chief Executive
(Steel Business) and Executive Director & Chief Executive (Wire & Wire
Ropes Business) respectively. The shareholders approval is being sought
in next annual general meeting for their appointment and remuneration
payable to them from the respective dates of appointment. Pending
shareholders approval, auditors have made a reference of the same in
their report for the remuneration accounted for in accounts for year
ended 31st March, 2010.
Mr. U. V. Rao who retired by rotation in last annual general meeting
did not seek re-election. Mr. Suresh Neotia resigned from Board during
the year. Your Directors place on record their warm appreciation for
contributions made by them in progress and growth of the Company.
In the last annual general meeting, shareholders have approved payment
of commission to Mr. Prashant Jhawar, a Non Executive Director and the
then Vice Chairman of the Company @ 1.5% of net profits of the Company
for each of five financial years commencing from 1st April, 2008
subject to approval of Central Government. Central Government, in the
meantime has approved such payment for a period of 2 years up to
financial year 2009-10. In view of his significant contribution, your
Directors propose to continue to pay commission @ 1.5% of net profits
(computed as per section 198/349 of the Companies Act) to Mr. Prashant
Jhawar for a further period of five financial years commencing from 1st
April 2010. Accordingly, your approval is being sought to this effect
and requisite application will be made to the Central Government
thereafter.
On 10th May, 2010, Mr. B. K. Jhawar stepped down as Chairman of the
Company. The Board of Directors appointed Mr. Prashant Jhawar, vice
Chairman and Non-Executive Director of the Company as Chairman of the
Board and the Company in his place, in non-executive capacity. The
Board places on record its huge appreciation for contribution of Mr. B.
K. Jhawar as Chairman. The Board decided to designate him as Chairman
Emeritus. He would, however, continue to remain on Board as
Non-Executive Director. He will also be heading the Business Strategy
Committee of the Board.
Directors Responsibility Statement Pursuant to requirements under
Section 217 (2AA) of the Companies Act, 1956 with respect to Directors
Responsibility Statement, it is hereby confirmed that:
i) The applicable accounting standards have been followed in
preparation of annual accounts for financial year ended 31st March,
2010 and proper explanations have been furnished relating to material
departures;
ii) The accounting policies have been selected and applied consistently
and reasonably and prudent judgments and estimates have been made so as
to give a true and fair view of state of affairs of the Company at end
of financial year and of profit of the Company for year under review;
iii) The proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with provisions of the
Companies Act, 1956 for safeguarding assets of the Company and for
preventing and detecting fraud and other irregularities; and
iv) The annual accounts for financial year ended 31st March 2010 have
been prepared on a going concern basis.
CEO / CFO Certification
The Managing Director and Chief Financial Officer of the Company
submitted a certificate to Board of Directors as required under Clause
49 of Listing Agreement for the year ended 31st March 2010.
Additional disclosures
In line with requirements of listing agreements and accounting
standards issued by the Institute of Chartered Accountants of India,
your Company made additional disclosures in respect of consolidated
financial statements, related party transactions and segmental
reporting.
Auditors
The auditors, M/s. Price Waterhouse, Chartered Accountants, retire at
conclusion of forthcoming Annual General Meeting and being eligible,
have offered themselves for re-appointment.
Cost auditors
The Board of Directors appointed M/s S. Gupta & Co., Cost Accountants,
to conduct cost audit for steel division, wire rope and speciality
products division, for financial years 2008-09 and 2009-10. The Company
received approvals for same from the central government. The Board
approved cost audit reports for financial year 2008-09 for these
divisions and same were submitted to the central government.
Further, the Board appointed M/s. Guha, Ghosh, Kar & Associates, as
cost auditors of the Company for financial year 2010-11. The requisite
application was made to the central government.
Energy conservation
As required under Section 217(1)(e) of the Companies Act, 1956, details
regarding conservation of energy, technology absorption and foreign
exchange earning and outgo are given in the annexure attached hereto
and form part of this Report.
Corporate social responsibility
Your Company continued taking fresh initiatives in terms of Corporate
Social Responsibility and made considerable progress in integrating its
operations with developing sustainable income generation of communities
around its operations.
During the year Krishi Gram Vikas Kendra took fresh initiatives in
primary education in partnership with IL&FS Education and Technology
Services Ltd, in three schools. It further developed the concept of low
cost high quality learning by piloting four of its own child-centered
schools in rural Jharkhand under the brand name KGVK Gurukul.
KGVK organises training programs for various initiatives undertaken by
it including natural resource management, dairy, agriculture,
livelihood, trade facilitation, healthcare and education.
During 2009-10, a new tie-up was established with ÃJharcraftà à a
Government of Jharkhand undertaking which looks at the development of
handlooms, handicraft and silk industry. KGVK is currently
implementing projects in partnership with many prestigious institutions
like The Energy Research Institute (TERI), NABARD, Department of
Science and Technology, Government of India and Government of
Jharkhand.
The Directors of your Company express their profound appreciation to
all agencies, institutions, government authorities and its employees
for supporting KGVKs initiatives.
Awards and Recognition
During the year under review, Usha Martin Singapore Pte Limited was
certified a Singapore 1000 Company by DP Information Group, a body
approved by Government of Singapore.
Appreciation
Your Directors place on record their appreciation for valuable
cooperation and support of customers, suppliers, contractors,
shareholders, investors, government authorities, financial
institutions, banks, partners and collaborators.
On behalf of the Board of Directors
Place: Kolkata B. K. Jhawar P. Jhawar
Date: 10th May, 2010 Chairman Emeritus Chairman