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Directors Report of Visa Steel Ltd.

Mar 31, 2016

Dear Shareholders,

The Directors are pleased to present this Twentieth Annual Report of the Company together with the Audited Standalone and Consolidated Financial Statements of Accounts for the financial year ended 31 March 2016.

(Rs. in Million)

Particulars

Standalone

Consolidated

2015-16

2014-15

2015-16

2014-15

Net Revenue

10,111.90

9,221.57

13,031.34

12,802.74

Other Income

272.18

288.52

131.90

148.70

Total Revenue

10,384.08

9,510.09

13,163.24

12,951.44

Profit before interest, depreciation, tax & exceptional item

119.80

267.98

46.84

307.59

Finance Cost

4,453.71

2,061.90

4,754.44

2,293.60

Depreciation

1,226.86

574.09

1,431.89

767.30

Profit / (Loss) before Exceptional & Extraordinary Items and Taxation

(5,560.77)

(2,368.01)

(6,139.49)

(2,753.31)

Exceptional & Extraordinary Items

-

-

-

(212.95)

Profit /(Loss) before Tax

(5,560.77)

(2,368.01)

(6,139.49)

(2,966.26)

Tax Expenses

274.70

46.39

274.79

60.18

Profit / (Loss) after Tax

(5,835.47)

(2,414.40)

(6,414.28)

(3,026.44)

Minority Interest

-

-

(259.00)

(297.34)

(Loss) / Profit for the period

(5,835.47)

(2,414.40)

(6,155.28)

(2,729.10)

OPERATIONS

The Company is pursuing Special Steel Business, Ferro Alloy Business and Coke Business. The Special Steel Business includes production of Hot Metal/Pig Iron, DRI/Sponge Iron and Special Steel Bars & Wire Rods. Whereas, the Ferro Alloy Business includes production of High Carbon Ferro Chrome and generation of Power for captive use and the Coke Business includes production of Coke and Steam.

The consolidated total revenue of the Company stood at Rs. 13,163.24 Million for the financial year 2015-16. The consolidated profit before interest, depreciation, tax and exceptional item is Rs. 46.84 Million in the financial year 2015-16.

The Blast Furnace having installed capacity of 225,000 TPA produced 121,521 MT Hot Metal as compared to 42,931 MT in the previous year. The DRI Plant, having installed capacity of 300.000 TPA produced 224,934 MT Sponge Iron as compared to 184,149 MT in the previous year.

The Ferro Alloy Plant, with a total current operating capacity of 120.000 TPA including the Furnaces taken on lease from VISA BAO Limited, a subsidiary Company, produced 85,836 MT of Ferro Alloys in the financial year 2015-16 compared to 62,719 MT in 2014-15. The generation of electricity from Company''s Captive Power Plant, having installed capacity of 657 Million units per annum, was 406 Million units in financial year 2015-16 as compared to 367 Million units in the previous year.

The Company has 51% stake in VISA SunCoke Limited (VSCL) which is operating the business of manufacturing and sale of Metallurgical Coke and associated Steam Generation Units. VSCL''s production of Coke was 294,258 MT during the year, compared to 295,734 MT in the previous year.

During the year under review, the Company''s performance was adversely impacted due to various external factors beyond management control including failure of the commitment made by the State Government through MoU to grant captive Iron Ore Mining Lease, depriving the Company from long term source of Iron Ore at cost, de-allocation of Coal Block by Ministry of Coal & Hon''ble Supreme Court''s order dated 24 September 2014, depriving the Company from long term source of Coal at cost, non availability of Iron Ore and Chrome Ore at viable prices due to closure of Mines due to Shah Commission Investigation since 2011 & Supreme Court judgment on 16 May 2014, non-availability of working capital for Plant operations, sharp drop in Steel prices due to Chinese overcapacity, dumping of Steel from China and Russian Rouble depreciation, FTA''s with Japan & Korea wherein Steel was being imported at import duty of below 2.5% and high interest costs, logistics costs, infrastructure bottlenecks etc.

The Iron Ore & Chrome Ore availability has improved from end 2015 onwards subsequent to the implementation of the MMDR

(Amendment) Act and restarting of various closed mines. With the improvement in raw material availability and holding on operations, the operations of the Company has improved significantly from Q4 FY''2016 onwards. However, a period of uncertainty in supply of Iron Ore & Chrome Ore is likely after 31st March 2020 since many non-captive mines will expire. The Government also implemented Minimum Import Price (MIP) dated 5th February 2016 to check imports of Steel at predatory pricing and imposed anti-dumping duties. The Government is also preparing a Policy for revival of the Steel Sector including financial restructuring.

Due to the continued stress across the Steel Sector, the Company has not been able to service its debt and the account of the Company has become Non-Performing Asset (NPA) with its Lenders. As per RBI, if the loan is already an NPA, there is no limit to the kind of restructuring that is possible. The Company has been in discussions with Lenders to induct investor and restructure the loan to a sustainable level. The Company''s plan to transfer its Special Steel business to VISA Special Steel Limited, a subsidiary of the Company to facilitate fund raising through strategic investor / financial investors has been delayed due to objection raised by HUDCO. The Company plans to complete the amalgamation of VISA Bao Limited with the Company, consequent to which Baosteel will hold 5% stake in the Company. The Company is in discussions with potential investors to infuse funds in the Company as working capital to improve operations and Lenders to restructure the loan to a sustainable level.

FUTURE OUTLOOK

As per the Ministry of Steel, Government of India, the current per capita consumption of finished steel in the Country is only around 60 kg which is far lower than the world average of 220 kg (China at 500 kg). It is estimated that India would need 300 million TPA of Steel by 2030 and, therefore, there is a huge growth potential in Steel consumption in India. However, any significant improvement in demand for Iron and Steel products may take a little longer and show up once investments in infrastructure and construction industries start picking up.

The Company has set up economically viable productive assets and is committed to its vision to emerge as an efficient producer of high quality value added products including Special Steel Long products, Ferro Chrome and Coke. Having set up state of the art value addition facilities, the Company is now focused on increasing capacity utilization of all Units, improving efficiency, cutting overhead costs and reducing raw material costs by securing captive Iron Ore and Chrome Ore mines in order to improve margins.

Going forward, the Company expects that revenues and margins from Special Steel, Ferro Alloy & Metallurgical Coke businesses shall drive your Company forward.

DIVIDEND

In view of the losses incurred by the Company, your Directors have not recommended any dividend for the financial year ended 31 March 2016.

TRANSFER TO RESERVES

In view of losses incurred by the Company during the year, no amount has been transferred to the General Reserve for the financial year ended 31 March 2016.

CHANGE IN NATURE OF BUSINESS

During the year under review, there has been no change in the nature of business of the Company.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year under review your Company transferred Rs. 359,635 to the Investor Education and Protection Fund pertaining to Unpaid Dividend for the Financial Year 2007-08.

SHARE CAPITAL

The Company''s paid up equity share capital remained at Rs. 1,100,000,000 (Rupees One Hundred Ten Crores only) comprising of 110,000,000 equity shares of Rs. 10 each. There was no change in the Company''s share capital during the year under review.

TRANSFER OF SPECIAL STEEL BUSINESS

The Board of Directors of the Company had approved a Scheme of Arrangement under Sections 391 to 394 of the Companies Act, 1956, between the Company and VISA Special Steel Limited (VSSL), a subsidiary of the Company, and their respective shareholders and creditors, which inter alia, envisages transfer of Special Steel Business (comprising of Blast Furnace, DRI Plant, Steel Melt Shop and Rolling Mill) of the Company with all its assets and liabilities, into VSSL. The Appointed Date of the Scheme is 1 April 2013 or such other date as may be fixed or approved by the Hon''ble High Court of Judicature of Orissa at Cuttack. The Scheme has been approved by the members of the Company at the Court Convened Meeting (CCM) held on 10 June 2014. Subsequent to the approval of the members, a petition was filed before the Hon''ble High Court of Orissa on 25 June 2014. Lender''s approval was received on 31 December 2014. The matter is being heard in High Court of Orissa and decision is awaited.

AMALGAMATION OF VISA BAO LIMITED

The Board of Directors of the Company had approved a Scheme of Amalgamation under Section 391 to 394 of the Companies Act, 1956, between the Company and VISA BAO Limited, a subsidiary of the Company and their respective shareholders. The appointed date of the Scheme is 1 April 2015 or such other date as may be fixed or approved by the Hon''ble High Court of Judicature of Orissa at Cuttack. The scheme is subject to necessary approval from regulatory authorities. Post amalgamation, Baosteel Resources Co. Ltd., China will hold 5% stake in the Company.

AMALGAMATION OF KALINGANAGAR SPECIAL STEEL PRIVATE LIMITED

The Board of Directors of the Company had approved a Scheme of Amalgamation under Section 391 to 394 of the Companies Act, 1956, between the Company and Kalinganagar Special Steel Private Limited, a subsidiary of the Company and their respective shareholders and creditors. The appointed date of the Scheme is 31 March 2014 or such other date as may be fixed or approved by the Hon''ble High Court of Judicature of Orissa at Cuttack.

HOLDING, SUBSIDIARY COMPANIES

During the year under review VISA Infrastructure Limited ceased to be the Holding Company of your Company w.e.f. 22 April

2015. The Company has seven subsidiaries including indirect subsidiaries namely, VISA BAO Limited, VISA SunCoke Limited, Ghotaringa Minerals Limited, Kalinganagar Special Steel Private Limited, Kalinganagar Chrome Private Limited, VISA Ferro Chrome Limited and VISA Special Steel Limited:

(i) VISA BAO Limited (VBL) is a Joint Venture between the Company and Baosteel Resources Co. Ltd. (Baosteel), China. VBL is setting up a Ferro Chrome Plant with 4 Submerged Arc Furnaces at Kalinganagar in Odisha of which 2 furnaces were commissioned in the month of June 2013. The remaining two furnaces are expected to be completed, one each before 31 March 2017 and during 2017-18, respectively. The Company holds 65 percent stake in VBL and Baosteel, one of the leading

Steel companies in the world, holds the balance 35 percent stake.

(ii) VISA SunCoke Limited (VSCL) is a Joint Venture with Sun Coke Europe Holding B.V. (SunCoke), in which the Company holds 51 percent stake and SunCoke holds remaining 49 percent stake. The joint venture comprises of 400,000 MTPA Heat Recovery Coke Plant and associated Steam Generation Units at Kalinganagar in Odisha. The joint venture provides great opportunity for VSCL to leverage its operating and technological expertise to serve customers across India with the highest quality coke.

(iii) Ghotaringa Minerals Limited (GML) is a Joint Venture between the Company and Orissa Industries Limited (ORIND).

(iv) Kalinganagar Special Steel Private Limited, a wholly owned subsidiary, was incorporated on 27 May 2013.

(v) Kalinganagar Chrome Private Limited, a wholly owned subsidiary, was incorporated on 1 July 2013.

(vii) VISA Ferro Chrome Limited (VFCL), a step down subsidiary was incorporated on 26 July 2013. VFCL is a wholly owned subsidiary of Kalinganagar Special Steel Private Limited.

(vi) VISA Special Steel Limited incorporated on 27 July 2012 is a wholly owned subsidiary of VISA Ferro Chrome Limited.

The consolidated financial statements presented by the Company include financial information of its subsidiaries prepared in compliance with the applicable Accounting Standards. A statement containing the salient features of

the financial statement of the Company''s subsidiaries in the prescribed form AOC-1 pursuant to first proviso to Section 129(3) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is annexed separately to the financial statements.

The Annual Accounts of the subsidiary companies will be made available to the shareholders of the aforesaid subsidiaries and the Company as and when they demand and will also be kept for inspection by any investor at the registered office of the Company and these subsidiaries. The Financial statements of the Company and its subsidiaries are also available on the website of the Company.

The highlights of performance of subsidiaries as on 31 March 2016 and their contribution to the overall performance of the Company during the period under review, is tabulated below:

(Rs. In Million)

Name of the Subsidiary

Total Revenue

Profit / (Loss) After Tax

Profit / Loss considered in consolidation

Networth

attributable

VISA Suncoke Ltd

4,095.18

(417.98)

(213.17)

525.35

VISA BAO Ltd

160.08

(175.41)

(114.02)

447.98

Kalinganagar Special Steel Private Limited

-

(0.15)

(0.15)

(0.24)

Kalinganagar Chrome Private Limited

-

(0.01)

(0.01)

0.53

Ghotaringa Minerals Limited

0.07

0.00

0.00

8.91

EXTENSION OF DATE FOR HOLDING ANNUAL GENERAL MEETING OF THE COMPANY

In accordance with provisions of Section 96 read with Section 129 of the Companies Act, 2013, the Annual General Meeting (AGM) of the Company for the financial year ended 31 March 2016, was due to be held on or before 30 September 2016.

The Company approached the Registrar of Companies, Orissa to extend time by three months for holding the Annual General Meeting so that necessary effect could be given to the Scheme of Arrangement between the Company and VISA Special Steel Limited on its sanction by the Hon''ble High Court of Judicature of Orissa at Cuttack and to complete the preparation of financial statements of the Company after giving effect to the Scheme. Necessary approval to hold the Annual General Meeting for the financial year 2015-16 up to 31 December 2016 was granted by the Registrar of Companies, Orissa.

BOARD MEETINGS

The Board met 6 times during the year, the details of which are given in the Corporate Governance Report that forms part of the Annual Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulation").

Further, the Independent Directors at their meeting, reviewed the performance of the Board, Chairman of the Board and of Non Independent Directors, as required under the Act and the Listing Regulations.

The Independent Directors at their meeting also assessed the quality, quantity and timelines of flow of information between the Company Management and the Board of Directors of the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors

In accordance with the provisions of Section 152 of the Companies Act, 2013 and in terms with the Articles of Association of the Company, Mr. Manoj Kumar Digga, Whole time Director designated as Director (Finance) & Chief Financial Officer (DIN: 01090626), retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. The Board recommends for his re-appointment.

Mr. Shiv Dayal Kapoor (DIN: 00043634), Mr. Debi Prasad Bagchi (DIN: 00061648), Mr. Pratip Chaudhuri (DIN 00915201),

Ms. Gauri Rasgotra (DIN: 06862334) and Mr. Kishore Kumar Mehrotra (DIN 02894045) have given declarations confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Regulation 17 of the SEBI (Listing Obligation and Disclosure Requirements), Regulation 2015.

Mr. Manas Kumar Nag (DIN 02058292) was appointed as Nominee Director (Nominee of State Bank of India) w.e.f. 14 August 2015.

Mr. Manoj Kumar Digga (DIN 01090626) continues as the Whole time Director designated as Director (Finance) & Chief Financial Officer of the Company for a period of 3 (three) years w.e.f. 14 August 2015. The appointment and remuneration payable to him was approved by the Shareholders of the Company at its last Annual General Meeting held on 28 December 2015.

Mr. Manoj Kumar (DIN 06823891) continues to be the Whole time Director designated as Director (Kalinganagar) of the Company for a period of 3 (three) years w.e.f. 15 September 2015. The appointment and remuneration payable to him was approved by the Shareholders of the Company at its last Annual General Meeting held on 28 December 2015.

Subsequent to the year end, Ms. Gauri Rasgotra (DIN: 06862334) had resigned as the Independent Woman Director w.e.f 27 July 2016 and Ms. Puja Sondhi (DIN: 06592082) was appointed as an Additional Independent Woman Director w.e.f 24 October 2016 to hold office up to the ensuing Annual General Meeting. Mr. Shiv Dayal Kapoor (DIN: 00043634) resigned as an Independent Director w.e.f 4 November 2016 due to health reasons.

Mr. Vishambar Saran (DIN: 00121501) whose term of 3 Years as Whole-time Director designated as the Chairman ends on 15 December 2016, being eligible has offered himself for reappointment. The appointment and remuneration payable to him require the approval of Members of the Company at the ensuing Annual General Meeting of the Company.

Mr. Vishal Agarwal (DIN: 00121539) whose term of 3 Years as Vice Chairman & Managing Director ends on 24 June 2017 being eligible has offered himself for reappointment. The appointment and remuneration payable to him require the approval of Members of the Company at the ensuing Annual General Meeting of the Company.

Mr. Manoj Kumar Digga (DIN: 01090626) continues as the Whole-time Director designated as Director (Finance) & Chief Financial officer and Mr. Manoj Kumar (DIN: 06823891) continues as the Whole-time Director designated as Director (Kalingangar) on the Board of the Company.

Brief resume of the above Directors, nature of their expertise in their specific functional areas, details of directorships in other companies and the chairmanship / membership of committees of the Board, as stipulated under Regulation 17 of the Listing Regulation and Secretarial Standard - 2 are given in the Notice for the ensuing Annual General Meeting.

Key Managerial Personnel

During the year, Mr. Keshav Sadani was appointed as the Company Secretary and Compliance Officer of the Company w.e.f. 23 May 2015. Subsequent to the year end, Mr. Keshav Sadani resigned as the Company Secretary and Compliance Officer of the Company w.e.f 25 June 2016.

Consequent to the resignation of Mr. Sadani, the Board appointed Mr. Sudhir Kumar Banthiya as the Company Secretary and Compliance Officer of the Company w.e.f 13 September 2016.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Nomination and Remuneration Committee evaluated the performance of all the Directors on parameters such as level of engagement, independence of judgment, contribution to the strategic planning process, safeguarding the interest of the stakeholders, etc. and in context of the role played by them as a member of the Board at its meetings, in assisting the Board in realizing its role of strategic supervision of the functioning of the Company.

The Board, after taking into consideration the evaluation exercise carried out by the Nomination and Remuneration Committee and by the Independent Directors, carried out an annual performance evaluation of its own performance, the individual Directors as well as the Board Committees, in due compliance with the provisions of the Companies Act, 2013 and the Listing Regulations. The performance evaluation of the Independent Directors was carried by the entire Board and the performance evaluation of the Chairman and Non-Independent Directors was carried out by the Independent Directors.

The Directors expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS'' RESPONSIBILITY STATEMENT

In terms of the provisions of Section 134(5)) of the Companies Act, 2013, your Directors to the best of their knowledge and ability confirm:

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

(b) That the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 31 March 2016 and of the loss of the company for that period;

(c) That the director had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

(e) That the directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

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

AUDIT COMMITTEE

The Audit Committee comprises of 3 (three) Non-Executive Independent Directors. As on date Mr. Kishore Kumar Mehrotra is the Chairman of the Audit Committee. The members of the Committee possess adequate knowledge of Accounts,Audit and Finance, among others. The composition of the Audit Committee meets the requirements as per Section 177 of the Companies Act, 2013 and is detailed in the Corporate Governance Report forming part of this Annual Report.

All recommendations made by the Audit Committee during the financial year 2015-16 were accepted by the Board of Directors of the Company.

CEO / CFO CERTIFICATION

As required under SEBI (Listing Obligation and Disclosure Requirements), Regulations 2015 Mr. Vishal Agarwal, Vice Chairman & Managing Director and Mr. Manoj Kumar Digga, Wholetime Director designated as Director (Finance) & Chief Financial Officer of the Company have certified to the Board regarding the Financial Statements for the year ended 31 March 2016, which is annexed to this Report

Auditors

Statutory Auditors and Auditors Report

The members of the Company had, at the 18th Annual General Meeting of the members of the Company held on 24 December 2014, approved the appointment of M/s. Lovelock & Lewes, Chartered Accountants as Statutory Auditors of the Company to hold office from the conclusion of that Annual General Meeting till the conclusion of 21st Annual General Meeting, subject to ratification by members at every Annual General Meeting.

Accordingly, the existing appointment of M/s. Lovelock & Lewes, Chartered Accountants, as Statutory Auditors of the Company is placed for ratification by shareholders at the ensuing annual general meeting.

In compliance with Section 139 and other applicable provisions of the Companies Act, 2013, the Company has obtained a written consent from the Auditors and also a certificate to the effect that their appointment, if ratified, would be in accordance with the conditions prescribed under the Act.

The para-wise management response to the qualifications / observations made in the Independent Auditors Report is stated as under:

1. Attention is drawn to para 9 of the Independent Auditors Report regarding Matter of Emphasis. The clarification of the same is provided in Note No. 44 of the Accounts of the Standalone Accounts. Subsequent to the erosion of net worth, your Company is evaluating the applicability of various statutory guidelines/provisions including referring the matter to the Competent Authority.

2. Attention is drawn to para 10 of the Independent Auditors Report regarding Matter of Emphasis. The clarification of the same is provided in Note No. 14 of the Accounts of the Standalone Accounts.

3. As regards para (iii) (b) and (c) of the Annexure to the Independent Auditors Report , your Directors report that Ghotaringa Minerals Limited, a subsidiary of the Company could not pay the interest of Rs. 2.74 million as at Balance Sheet date. The Board of Directors of the Company had extended the tenure of repayment up to May 2018.

4. The Auditors observation in para viii of the Annexure to the Auditors report regarding dues to financial institution and banks aggregating Rs. 9867.55 million as mentioned in Note 5D were due to severe liquidity crisis being faced by the Company on account of continued cash losses incurred.

Internal Auditors

In terms of the provisions of Section 138 of the Act, M/s. L B Jha & Company, an Independent Chartered Accountants were appointed as Internal Auditors of the Company for the financial year 2015-16. The Audit Committee in consultation with the Internal Auditors formulates the scope, functioning, periodicity and methodology for conducting the Internal Audit. The Audit Committee, interalia, reviews the Internal Audit Report.

Secretarial Auditors

Pursuant to Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed CS Manoj Kumar Banthia of M/s. M K B & Associates, Practicing Company Secretaries, as its Secretarial Auditor to undertake the Secretarial Audit for the financial year 2015-16. The report of the Secretarial Auditor in specified form MR-3, is annexed herewith as Annexure I and forms part of this report. The Resolutions in respect of Related Party Transactions for Shareholder''s Approval form part of the Notice of the ensuing Annual General Meeting.

The Board has re-appointed CS Manoj Kumar Banthia of M/s. M K B & Associates, Practicing Company Secretaries, as Secretarial Auditors of the Company for the financial year 20 16-17.

Cost Auditors

As per Section 148 of the Companies Act, 2013, the Board of Directors has appointed, M/s. DGM & Associates, (Registration

No.00038), Cost Accountants, Kolkata as Cost Auditors of the Company, to carry out the cost audit of the products (Pig Iron & Pig Scrap, Ferro Chrome and Sponge Iron) manufactured by the Company for the financial year ending 31 March 2017.

The Cost Audit Report for the year 2015-16 has been filed under XBRL mode within the due date of filing.

RISK MANAGEMENT

The speed and degree of changes in the global economy and the increasingly complex interplay of factors influencing the business makes Risk Management an inevitable exercise and to cater to the same, your Company has identified major focus areas for risk management to ensure organizational objectives are achieved and has a robust policy along with well-defined and dynamic structure and proactive approach to assess, monitor and mitigate risks associated with the business.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS

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

INTERNAL CONTROL SYSTEM

Your Company has adequate system of internal control procedures commensurate with its size and the nature of business. The internal control systems of the Company are monitored and evaluated by the Internal Auditors and their audit reports are periodically reviewed by the Audit Committee of the Board of Directors of the Company.

Your Company manages and monitors the various risks and uncertainties that can have adverse impact on the Company''s business. Your Company is giving major thrust in developing and strengthening its internal audit so that risk threat can be mitigated.

RELATED PARTY TRANSACTIONS

All related party transactions entered into during FY 2015-16 were on arm''s length basis and also in the ordinary course of business. No related party transactions were made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons during FY 2015-16, except those reported.

All Related Party Transactions were placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee was obtained on a yearly basis for the transactions which were of foreseen and repetitive in nature.

The transactions entered into pursuant to the omnibus approval so granted were audited and a statement giving details of all related party transactions was placed before the Audit Committee for its approval on a quarterly basis. The policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website at www.visasteel.com.

Information on transaction with related parties is given in Form AOC-2, Annexure II and the same forms part of this report.

None of the Directors or KMP has any pecuniary relationships or transactions vis-a-vis the Company during FY 2015-16.

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

Information pursuant to Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 in respect of Conservation of Energy and Technology Absorption and Foreign Exchange Earnings and Outgo is given in Annexure III forming part of this Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the financial Statements.

HUMAN RESOURCES

The Company places significant emphasis on recruitment, training & development of human resources, which assumes utmost significance in achievement of corporate objectives.

The Company integrates employee growth with organizational growth in a seamless manner through empowerment and by offering a challenging workplace aimed towards realization of organizational goals. To this effect, your Company has a training center at its Plant for knowledge-sharing and imparting need based training to its employees. The Company also has in place a Performance Management System in SAP for performance appraisal of the employees. To ensure accommodation, hospitality and other facilities for its employees, the Company has set up a modern guest house at Kalinganagar.

PARTICULARS OF EMPLOYEES AND OTHER ADDITIONAL INFORMATION

The information required under Section 197(12) of the Companies Act, 2013, read with Rule 5(2) & 5(3) of the Companies (Particulars of Employees) Rules, 1975, as amended, and the Companies (Appointment and Remuneration of Managerial Personnel)

Rules, 2014 (the Rules) are set out in Annexure IVA to this Report. However, as per the provisions of Section 136 of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining a copy of the statement may write to the Company.

The disclosure pertaining to remuneration of Directors, Key Managerial Personnel and employees as required under Section 197(12) of the Act read with Rule 5(1) of the Rules are provided in Annexure IVB to this report.

EMPLOYEES STOCK OPTION

The Company has a ESOP Scheme in place titled Employee Stock Option Scheme 2010 (ESOP Scheme 2010), for permanent employees including any Director, whether whole time or otherwise, of the Company, its subsidiaries and the Holding Company to be administered by the Nomination and Remuneration Committee of the Board of Directors of

the Company. ESOP Scheme 2010 provides an incentive to attract, retain and reward the employees and enable them to participate in future growth and financial success of the Company. Each option confers a right upon the employee to apply for one equity share of the Company..

Compiled by: Dion Global Solutions Limited


COMPANY OVERVIEW GOVERNANCE REPORTS FINANCIAL STATEMENTS

The particulars with regard to ESOP scheme as on 31 March 2016, as required to be disclosed pursuant to the provisions of Rule 12(9) of the Companies (Share Capital & Debentures) Rules, 2014 are set out in Annexure V to this Report.

A Certificate from the Statutory Auditors with regard to the implementation of ESOP Scheme 2010 would be placed at the forthcoming Annual General Meeting.

DEPOSITS

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

CONSOLIDATED FINANCIAL STATEMENT

In terms of SEBI (Listing Obligation and Disclosure Requirements), Regulations 2015 Consolidated Financial Statement, conforming to Accounting Standard 21 issued by the Institute of Chartered Accountants of India, is attached as a part of the Annual Report.

CORPORATE GOVERNANCE

The Company is committed in maintaining the highest standards of Corporate Governance and adheres to the stipulations prescribed under Clause 17-23 of the SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015. A Report on Corporate Governance & Shareholder Information together with the Auditors'' Certificate thereon is annexed as part of the Annual Report.

MANAGEMENT DISCUSSION & ANALYSIS

A detailed analysis of the Industry and Company Outlook, Company''s operations, project review, risk management, strategic initiatives and financial review & analysis, as stipulated under SEBI (Listing Obligation and Disclosure Requirements) Regulations

2015 is presented under a separate section titled "Management Discussion and Analysis" forming part of the Annual Report.

EXTRACT OF THE ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT 9 as per provisions of Companies Act, 2013 and rules thereto is annexed to this report as Annexure VI.

VIGIL MECHANISM (WHISTLE BLOWER POLICY)

The Company has a Vigil Mechanism / Whistle Blower Policy to deal with instances of fraud and mismanagement, if any. The policy provides for adequate safeguards against victimization of employees and / or Directors and also provides for direct access to the Chairman of the Audit Committee. The Policy is uploaded on the website of the Company at www.visasteel.com..

CORPORATE SOCIAL RESPONSIBILITY POLICY

The Corporate Social Responsibility (CSR) policy recommended by the Corporate Social Responsibility Committee had been approved by the Board of Directors. The CSR policy is available on the website of the Company www.visasteel.com and is also attached to this report as Annexure VII.

During the year, the CSR initiatives undertaken by the Company, although not mandatory under Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules 2014, are detailed in the Annual Report.

NOMINATION AND REMUNERATION POLICY

In terms of the requirement of Section 178 of the Companies Act, 2013, on the recommendation of the Nomination and Remuneration Committee, the Board has approved the Remuneration policy of the Company. The Remuneration policy is attached to the Board''s Report as Annexure VIII.

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

The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Company has not received any complaint of sexual harassment during the financial year 2015-16.

ACKNOWLEDGEMENT

Your Directors record their sincere appreciation for the assistance, support and guidance provided by banks, financial institutions, customers, suppliers, regulatory & government authorities, project & other business associates and stakeholders. The Directors also commend the continuing commitment and dedication of the employees at all levels which has been critical for the Company''s growth. The Directors look forward to their continued support in future.

Your Directors value your involvement as shareholders and look forward to your continuing support.

For and on behalf of the Board

Vishal Agarwal

Vice Chairman & Managing Director

Kolkata Manoj Kumar Digga

18 November 2016 Wholetime Director designated as Director

(Finance) & Chief Financial Officer


Mar 31, 2015

Dear Shareholders,

The Directors are pleased to present this Nineteenth Annual Report of the Company together with the Audited Standalone and Consolidated Financial Statements of Accounts for the financial year ended 31 March 2015.

FINANCIAL RESULTS

(Rs. Million)

Standalone Consolidated

Particulars 2014-15 2013-14 2014-15 2013-14

Net Revenue 9,221.57 10,299.58 12,802.74 14,549.36

Other Income 288.52 279.97 148.70 136.02

Total Revenue 9,510.09 10,579.55 12,951.44 14,685.38

Profit before interest, depreciation, tax & exceptional item 267.98 663.42 307.59 1,247.20

Finance Cost 2,061.90 1,450.31 2,293.60 1,625.60

Depreciation 574.09 577.29 767.30 747.77

Profit / (Loss) before Exceptional & Extraordinary Items and Taxation (2,368.01) (1,364.18) (2,753.31) (1,126.17)

Exceptional & Extraordinary Items - (160.77) (212.95) (374.15)

Profit /(Loss) before Tax (2,368.01) (1,524.95) (2,966.26) (1,500.32)

Tax Expenses 46.39 - 60.18 (64.73)

Profit / (Loss) after Tax (2,414.40) (1,524.95) (3,026.44) (1,435.59) Minority Interest - - (297.34) 42.69

(Loss) / Profit for the period (2,414.40) (1,524.95) (2,729.10) (1,478.28)

OPERATIONS

The Company is pursuing Special Steel Business, Ferro Alloy Business and Coke Business. The Special Steel Business includes production of Hot Metal/Pig Iron, DRI/Sponge Iron, Special Steel Blooms/Billets, Bars & Wire Rods and Rebars. Whereas, the Ferro Alloy Business includes production of High Carbon Ferro Chrome and generation of Power for captive use and the Coke Business includes production of Coke.

The consolidated total revenue of the Company stood at Rs. 12,951.44 Million for the financial year 2014-15. The profit before interest, depreciation, tax and exceptional item is Rs. 307.59 Million in the financial year 2014-15.

During the year under review, financial and operational performance of the Company has been adversely affected due to various external factors including failure of commitment to grant Iron Ore mines, de-allocation of Coal Block, non- availability of raw materials at viable prices due to mine closures, weak product prices due to over capacity and dumping of Steel mainly by China & Russia, Global Crash in Steel and commodity prices, the high interest costs, logistics costs, infrastructure bottlenecks etc. for domestic Steel Companies, due to delay in disbursement of sanctioned working capital & corporate loan and non-disbursement of the working capital for plant operation by some lenders.

The Blast Furnace having installed capacity of 225,000 TPA produced 42,931 MT Hot Metal. The DRI Plant having installed capacity of 300,000 TPA produced 184,149 MT Sponge Iron as compared to 156,082 MT in the previous year.

The Ferro Alloy Business, with a total current operating capacity of 120,000 TPA including the Furnaces taken on lease from VISA BAO Limited, a subsidiary Company, produced 62,719 MT of Ferro Alloy in the financial year 2014-15 compared to 70,568 MT in 2013-14. The generation of electricity from Company's Captive Power Plant, having installed capacity of 657 Million units per annum, was 367 Million units in financial year 2014-15 as compared to 435 Million units in the previous year.

The Company has 51% stake in VISA Sun Coke Limited (VSCL) which is operating the business of manufacturing and sale of Metallurgical Coke and associated Steam Generation Units. VSCL's production of Coke was 295,734 MT during the year.

The Special Steel Business has been affected due to closure of several Iron Ore mines due to Shah Commission investigation and Supreme Court judgment dated 16 May 2014. The over capacity and excess production in China resulting in Cheap imports in the country and adverse duty structure domestically have further impacted the Special Steel Business. The Ferro Alloy Business has been affected due to frequent stoppage in the supply of Chrome Ore and Concentrate due to closure of various Chrome Ore mines, whereas the Power Plant was affected due

to stoppage of Coal Linkage. The Coke Business performance has been affected due to sluggish demand for Coke in the domestic market and pressure of cheap imports from China.

The Company is in advanced stage to transfer its Special Steel Business to VISA Special Steel Limited, a subsidiary of the Company, in order to improve focus and facilitate fund raising through strategic / financial investor. The accumulated losses of the Company exceeded fifty percent of its net worth as at 31 March 2015. However, subsequent to the business re-organisation and with the expected improvement in raw material scenario, the Company expects the net worth to improve. In view of the above, the Company has not referred the matter to the Competent Authority. The replacement value of the assets is higher than the book value, and the Company plans to unlock value in the Special Steel Business through strategic / financial investors as it has done by inducting Sun Coke Energy, USA as a strategic investor in the Coke Business and Baosteel Resources Co. Ltd., China, in Ferro Alloy Business.

FUTURE OUTLOOK

According to the Ministry of Steel, Government of India, the current per capita consumption of finished steel in the country is only around 52 kg against the world average of 203 kg and therefore, there is a huge growth potential in steel consumption in India.

Your Company has a Special Steel Business for production of Hot Metal/Pig Iron, DRI/Sponge Iron, Special Steel Blooms/ Billets, Bars & Wire Rods, Rebars at Kalinganagar in Odisha for supply to the Automobile, Construction, Infrastructure, Engineering, Railway and Defense Sectors.

Your Company is committed to its vision to emerge as an efficient producer of high quality value added products including Coke, Ferro Alloy and Special Steel. Going forward, the Company expects the revenues and margins from Metallurgical Coke, Ferro Alloy & Special Steel Businesses to remain challenging in the short term, but is positive on the outlook over the medium to long term.

CDR

Your Company is focusing on consolidating its operations, improving raw material availability and operational efficiencies to reduce costs. The operations and cash flow of the Company have been affected due to delay in disbursement of sanctioned working capital & corporate loan and non-disbursement of the working capital for plant operation by some lenders. In view of the cash losses suffered by your Company due to high cost of raw material, weak product prices and high interest rate, and the consequent impact on cash flows, the Company has not been able to service its debt in a timely manner. In order to mitigate the cash strain and irregularity in debt servicing, the Company has been in discussions with lenders for Corrective Action Plan under Corporate Debt Restructuring (CDR) mechanism since 20 May 2015. Your Company has already infused additional equity funds of Rs. 325 Crores in a phased manner as per the CDR package. Meanwhile, lenders have invoked Strategic Debt Restructuring on 22 September 2015, which is subject to necessary approvals / authorizations (including special resolution by the shareholders). The Company is also evaluating option to induct strategic / financial investor and refinance debt to sustainable level.

TRANSFER OF SPECIAL STEEL BUSINESS

The Board of Directors of the Company has approved a Scheme of Arrangement under Sections 391 to 394 of the Companies Act, 1956, between the Company and VISA Special Steel Limited (VSSL), a subsidiary of the Company, and their respective shareholders and creditors, which inter alia, envisages transfer of its Special Steel Business (comprising of Blast Furnace, DRI Plant, Steel Melt Shop, Rolling Mill and associated steam generation units) to VSSL. The Appointed Date of the Scheme is 1 April 2013 or such other date as may be fixed or approved by the Hon'ble High Court of Judicature of Orissa at Cuttack. The Scheme has been approved by the members of the Company at the Court Convened Meeting (CCM) held on 10 June 2014. Subsequent to the approval of the members, a petition was filed before the Hon'ble High Court of Orissa on 25 June 2014. Lender's approval was received on 31 December 2014. Final Decision of the High Court of Orissa is awaited.

AMALGAMATION OF VISA BAO LIMITED

The Board of Directors of the Company had approved a Scheme of Amalgamation under Section 391 to 394 of the Companies Act, 1956, between the Company and VISA BAO Limited, a subsidiary of the Company and their respective shareholders. The appointed date of the Scheme is 1 April 2015 or such other date as may be fixed or approved by the Hon'ble High Court of Judicature of Orissa at Cuttack. The scheme is subject to necessary approval from all concerned authorities. Post Amalgamation, Baosteel will hold 5% stake in the Company.

AMALGAMATION OF KALINGANAGAR SPECIAL STEEL PRIVATE LIMITED

The Board of Directors of the Company had approved a Scheme of Amalgamation under Section 391 to 394 of the Companies Act, 1956, between the Company and Kalinganagar Special Steel Private Limited, a subsidiary of the Company and their respective shareholders and creditors. The appointed date of the Scheme is 31 March 2014 or such other date as may be fixed or approved by the Hon'ble High Court of Judicature of Orissa at Cuttack.

DIVIDEND

In view of the loss incurred by the Company, your Directors have not recommended any dividend for the financial year ended 31 March 2015.

TRANSFER TO RESERVES

In view of losses incurred by the Company during the year, no amount has been transferred to the General Reserve for the financial year ended 31 March 2015.

CHANGE IN NATURE OF BUSINESS

During the year under review, there has been no change in the nature of business of the Company.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Your Company has, subsequent to year end, transferred a sum of Rs. 359,635/- to Investor Education and Protection Fund, in compliance with the provisions of Section 124, 125 and other applicable provisions of the Companies Act, 2013 (corresponding to Section 205C of the Companies Act, 1956). The said amount represents dividend for the year 2007 – 08 which remained unclaimed for a period 7 years from its due date of payment.

SHARE CAPITAL

The Company's paid up equity share capital remained at Rs. 1,100,000,000 (Rupees One Hundred Ten Crores only) comprising of 110,000,000 equity shares of Rs. 10 each. There was no change in the Company's share capital during the year under review.

SUBSIDIARIES

The Company has seven subsidiaries including indirect subsidiaries namely, VISA BAO Limited, VISA SunCoke Limited, Kalinganagar Special Steel Private Limited, VISA Ferro Chrome Limited, VISA Special Steel Limited, Ghotaringa Minerals Limited and Kalinganagar Chrome Private Limited:

(i) VISA BAO Limited (VBL) is a Joint Venture between the Company and Baosteel Resources Co. Ltd. (Baosteel), China. VBL has a Ferro Alloy Plant with 4 Submerged Arc Furnaces at Kalinganagar in Odessa of which 2 furnaces have been commissioned and balance 2 Furnaces are under completion. The Company holds 65 percent stake in VBL and Baosteel, which is one of the leading Steel companies in the world, holds the balance 35 percent stake.

Subsequent to year end, the Board of Directors of the Company and VBL had approved the amalgamation of VBL with the Company through a Scheme of Amalgamation. Post Amalgamation, Baosteel will hold 5% stake in the Company. Necessary approvals have been initiated and are in progress.

(ii) VISA SunCoke Limited (VSCL) is a Coke making Joint Venture with SunCoke Europe Holding B.V. (SunCoke), in which the Company holds 51 percent stake and SunCoke holds remaining 49 percent stake. The joint venture comprises of 400,000 MTPA Heat Recovery Coke Plant and associated Steam Generation Units at Kalinganagar in Odisha. The joint venture provides great opportunity for VSCL to leverage its operating and technological expertise to serve customers across India with the highest quality coke.

(iii) Kalinganagar Special Steel Private Limited, a wholly owned subsidiary, was incorporated on 27 May 2013.

(iv) VISA Ferro Chrome Limited (VFCL), a step down subsidiary was incorporated on 26 July 2013. VFCL is a wholly owned subsidiary of Kalinganagar Special Steel Private Limited.

(v) VISA Special Steel Limited incorporated on 27 July 2012 and is a wholly owned subsidiary of VISA Ferro Chrome Limited.

(vi) Ghotaringa Minerals Limited (GML) is a Joint Venture between the Company and Orissa Industries Limited (ORIND).

(vii) Kalinganagar Chrome Private Limited, a wholly owned subsidiary, was incorporated on 1 July 2013.

The consolidated financial statements presented by the Company include financial information of its subsidiaries prepared in compliance with applicable Accounting Standards. A statement containing the salient features of the financial statement of the Company's subsidiaries in the prescribed form AOC-1 pursuant to first proviso to Section 129(3) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is annexed separately to the financial statements.

The Annual Accounts of the subsidiary companies will be made available to the shareholders of the aforesaid subsidiaries and the Company as and when they demand and will also be kept for inspection by any investor at the registered office of the Company and these subsidiaries. The Financial statements of the Company and its subsidiaries are also available on the website of the Company.

EXTENSION OF DATE FOR HOLDING ANNUAL GENERAL MEETING OF THE COMPANY

In accordance with provisions of Section 96 read with Section 129 of the Companies Act, 2013, the Annual General Meeting (AGM) of the Company for the financial year ended 31 March 2015, was due to be held on or before 30 September 2015. The Company approached the Registrar of Companies, Orissa to extend time by three months for holding the Annual General Meeting so that necessary effect could be given to the Scheme of Arrangement between the Company and VISA Special Steel Limited on its sanction by the Hon'ble High Court of Judicature of Orissa at Cuttack and to complete the preparation of financial statements of the Company after giving effect to the Scheme. Necessary approval was granted by the Registrar of Companies, Orissa vide their letter dated 14 August 2015.

BOARD MEETINGS

The Board met 7 times during the year, the details of which are given in the Corporate Governance Report that forms part of the Annual Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and the Listing Agreement.

Further, the Independent Directors at their meeting, reviewed the performance of the Board, Chairman of the Board and of Non Independent Directors, as required under the Act and the Listing Agreement.

DIRECTORS AND KEY MANAGERIAL PERSONNEL Directors

In accordance with the provisions of Section 152 of the Companies Act, 2013 and in terms with the Articles of Association of the Company, Mr. Vishal Agarwal, Vice Chairman & Managing Director (DIN: 00121539), retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. The Board has recommended his re-appointment.

Mr. Shiv Dayal Kapoor (DIN 00043634), Mr. Debi Prasad Bagchi (DIN: 00061648), Mr. Pratip Chaudhuri (DIN 00915201) and Ms. Gauri Rasgotra (DIN 06862334) have given declarations confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges.

Mr. Saubir Bhattarcharyya (DIN: 01383195) was appointed as Nominee Director (Nominee of State Bank of India (SBI)) on 10 February 2015. However, Mr. Bhattacharyya resigned from his office w.e.f. 6 April 2015. SBI has thereafter nominated Mr. Manas Kumar Nag (DIN 02058292) as its Nominee Director and the Board had accordingly appointed him as the Nominee Director w.e.f. 14 August 2015.

Mr. Manoj Kumar Digga (DIN 01090626) has been appointed as the Wholetime Director designated as Director (Finance) & Chief Financial Officer of the Company for a period of 3 (three) years w.e.f. 14 August 2015. The appointment and remuneration payable to him require the approval of the Members at the ensuing Annual General Meeting.

Subsequent to the year end, Mr. Punkaj Kumar Bajaj (DIN 02216069) Joint Managing Director & CEO (Steel Business) had expressed his desire to seek voluntary retirement from the services of the Company. The Board had accordingly, accepted his request and he was relieved from the services of the Company from the close of business hours on Monday, 14 September 2015.

Mr. Manoj Kumar (DIN 06823891) has been appointed as the Wholetime Director designated as Director (Kalinganagar) of the Company for a period of 3 (three) years w.e.f. 15 September 2015. The appointment and remuneration payable to him require the approval of the Members at the ensuing Annual General Meeting.

Mr. Kishore Kumar Mehrotra (DIN 02894045) has been appointed as the Additional Director (Non Executive, Independent) of the Company w.e.f. 12 November 2015. The Company has received Notice under Section 160 of the Companies Act, 2013, along with required deposit, from a member proposing his candidature for the office of Director (Non Executive, Independent) of the Company. The Board has recommended his appointment as Independent Director of the Company.

Brief resumeRs, of the above Directors, nature of their expertise in their specific functional areas, details of directorships in other companies and the chairmanship / membership of committees of the Board, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Notice for the ensuing Annual General Meeting.

Key Managerial Personnel

During the year, Mrs. Subhra Giri Patnaik, Company Secretary and Compliance Officer of the Company resigned from the services of the Company. The resignation was effective 23 November 2014.

Consequent to Mrs. Patnaik's resignation, the Board appointed Mr. Keshav Sadani as the Company Secretary and Compliance Officer of the Company w.e.f. 23 May 2015.

BOARD EVALUATION

The Board carried out an annual performance evaluation of its own performance, the individual Directors as well as the Board Committees, in due compliance with the provisions of the Companies Act, 2013 and the Listing Agreement. The performance evaluation of the Independent Directors was carried by the entire Board and the performance evaluation of the Chairman and Non – Independent Directors was carried out by the Independent Directors.

The Board evaluation was carried out in accordance with the criteria laid down in the Nomination and Remuneration policy of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

In terms of the provisions of Section 134(5) of the Companies Act, 2013, your Directors to the best of their knowledge and ability confirm:

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

(b) that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 31 March 2015 and of the loss of the company for that period;

(c) that proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) that the annual accounts had been prepared on a going concern basis;

(e) that the directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

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

AUDIT COMMITTEE

The Audit Committee comprises of 3 (three) Non Executive Independent Directors. Mr. Shiv Dayal Kapoor is the Chairman of the Audit Committee. The members of the Committee possess adequate knowledge of Accounts, Audit and Finance, among others. The composition of the Audit Committee meets the requirements as per Section 177 of the Companies Act, 2013 and of Clause 49 of the Listing Agreement and is detailed in the Corporate Governance Report forming part of this Annual Report.

All recommendations made by the Audit Committee during the financial year 2014 - 15 were accepted by the Board of Directors of the Company.

CEO / CFO CERTIFICATION

As required under Clause 49 (V) of the Listing Agreement with the Stock Exchanges, Mr. Punkaj Kumar Bajaj, erstwhile Joint Managing Director & CEO (Steel Business) and Mr. Manoj Kumar Digga, Whole time Director designated as Director (Finance) & Chief Financial Officer of the Company have certified to the Board regarding the Financial Statements for the year ended 31 March 2015, which is annexed to this Report

Auditors

Statutory Auditors and Auditors Report

The members of the Company had, at the 18th Annual General Meeting of the members of the Company held on 24 December 2014, approved the appointment of M/s. Lovelock & Lewes, Chartered Accountants as Statutory Auditors of the Company to hold office from the conclusion of that Annual General Meeting till the conclusion of 21st Annual General Meeting, subject to ratification by members at every Annual General Meeting.

Accordingly, the existing appointment of M/s. Lovelock & Lewes, Chartered Accountants, as Statutory Auditors of the Company is placed for ratification by shareholders at the ensuing annual general meeting.

In compliance with Section 139 and other applicable provisions of the Companies Act, 2013, the Company has obtained a written consent from the Auditors and also a certificate to the effect that their appointment, if ratified, would be in accordance with the conditions prescribed under the Act.

The para-wise management response to the qualifications / observations made in the Independent Auditors Report is stated as under:

1. As regards the para 8 of the Independent Auditors Report, attention is drawn to Note no. 34 of the Notes of the Accounts of the Standalone Account which is self-explanatory.

2. Attention is drawn to para 10 of the Independent Auditors Report regarding matter of emphasis. The clarification of the same is provided in Note no. 44 of the Notes of the Accounts of the Standalone Accounts.

3. As regards the para (iii) of the Annexure to the Independent Auditors Report, your Directors report that Ghotaringa Minerals Ltd, subsidiary of the Company could not pay the interest of Rs. 1.99 Million as at financial year end 31 March 2015, due to financial constraints and has assured that the same will be paid during the financial year 2015-16.

4. The Auditors' observation in para (viii) of the Annexure to the Auditors' Report that the accumulated losses of the Company exceeds fifty present of its net worth as at 31 March 2015 and it had incurred cash losses in the financial year ended on that date and immediate preceding financial year. The Scheme of Arrangement under Sections 391 to 394 of the Companies Act, 1956 for transfer of its Special Steel Business to VISA Special Steel Limited, subsidiary of the Company for proper focus on Special Steel Business and to facilitate attracting Investors is in the final stage of consideration by the Hon'ble High Court of Judicature of Orissa at Cuttack. Considering the improvement in the scenario and the outcome pursuant to this transfer the Company is not referring the matter to the competent authority;

5. The Auditors observation in para (ix) of the Annexure to the Auditors report regarding dues to financial institution and banks aggregating Rs. 2,518.24 million as mentioned in Note 5D were due to severe liquidity crisis being faced by the Company on account of continued cash losses incurred.

Internal Auditors

In terms of the provisions of Section 138 of the Act, M/s. L B Jha & Company, Independent Chartered Accountants were appointed as Internal Auditors of the Company for the financial year 2014-15. The Audit Committee in consultation with the Internal Auditors formulates the scope, functioning, periodicity and methodology for conducting the Internal Audit. The Audit Committee, interlaid, reviews the Internal Audit Report.

The Board has re-appointed M/s. L. B. Jha & Company, Independent Chartered Accountants as Internal Auditors of the Company for the financial year 2015-16.

Secretarial Auditors

Pursuant to Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed CS Manoj Kumar Banthia of M/s. M K B & Associates, Practicing Company Secretaries, as its Secretarial Auditor to undertake the Secretarial Audit for the financial year 2014 -15. The report of the Secretarial Auditor in specified form MR-3, is annexed herewith as Annexure I and forms part of this report. The report does not contain any observation or qualification or adverse remarks.

The Board has re-appointed CS Manoj Kumar Banthia of M/s. M K B & Associates, Practicing Company Secretaries, as Secretarial Auditors of the Company for the financial year 2015 – 16.

Cost Auditors

As per Section 148 of the Companies Act, 2013, the Board of Directors has appointed, M/s. DGM & Associates, (Registration No.00038), Cost Accountants, Kolkata as Cost Auditors of the Company, to carry out the cost audit of the products (Pig Iron & Pig Scrap, Ferro Alloy and Sponge Iron) manufactured by the Company for the financial year ending 31 March 2016.

The Cost Audit Report for the year 2013-14 has been filed under XBRL mode within the due date of filing.

RISK MANAGEMENT

The volatility in the global economy and the increasingly complex interplay of factors influencing the business makes Risk Management an inevitable exercise and to cater to the same, your Company has identified major focus areas for risk management to ensure organizational objectives are achieved and has a robust policy along with well-defined and dynamic structure and proactive approach to assess, monitor and mitigate risks associated with the business.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS

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

INTERNAL CONTROL SYSTEM

Your Company has adequate system of internal control procedures commensurate with its size and the nature of business. The internal control systems of the Company are monitored and evaluated by the Internal Auditors and their audit reports are periodically reviewed by the Audit Committee of the Board of Directors of the Company.

Your Company manages and monitors the various risks and uncertainties that can have adverse impact on the Company's Business. Your Company is giving major thrust in developing and strengthening its internal audit so that risk threat can be mitigated.

RELATED PARTY TRANSACTIONS

All related party transactions entered into during FY 2014-15 were on arm's length basis and also in the ordinary course of business. No related party transactions were made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons during FY 2014-15, except those reported.

All Related Party Transactions were placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee was obtained on a yearly basis for the transactions which were of foreseen and repetitive in nature. The transactions entered into pursuant to the omnibus approval so granted were audited and a statement giving details of all related party transactions was placed before the Audit Committee for its approval on a quarterly basis. The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website at: www.visasteel.com.

Information on transaction with related parties is given in Form AOC-2, Annexure II and the same forms part of this report.

None of the Directors or KMP has any pecuniary relationships or transactions vis-à-vis the Company during FY 2014-15.

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

Information pursuant to Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 in respect of Conservation of Energy and Technology Absorption and Foreign Exchange Earnings and Outgo is given in Annexure III forming part of this Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the financial Statements.

HUMAN RESOURCES

The Company has formulated a detailed Code of Conduct in order to practice ethical behavior and sound conduct to establish the principles that guide our daily actions. Ethical conduct is the cornerstone of how the Company does business. The Company is committed to creating a healthy work environment that enables employees to work without fear of prejudice, gender bias, sexual harassment and all forms of intimidation or exploitation. It is committed to provide a work environment that ensures every employee, is treated with dignity and respect.

The Company recognizes Human Resource as its most important assets and is constantly engaged in enriching the value and developing competencies of Human Resources through various development & training programmers. We improve our team building and encourage family bonding through various employee engagement social activities.

PARTICULARS OF EMPLOYEES AND OTHER ADDITIONAL INFORMATION

The information required under Section 197(12) of the Companies Act, 2013, read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (the Rules) are set out in Annexure IV to this Report. However, as per the provisions of Section 136 of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. The said information is available for inspection at the registered office of the Company during working hours. Any member interested in obtaining a copy of the statement may write to the Company.

The disclosure pertaining to remuneration of Directors, Key Managerial Personnel and employees as required under Section 197(12) of the Act read with Rule 5(1) of the Rules are provided in Annexure IVB to this report.

EMPLOYEES STOCK OPTION

The Company has a ESOP Scheme in place titled Employee Stock Option Scheme 2010 (ESOP Scheme 2010), for permanent employees including any Director, whether whole- time or otherwise, of the Company, its subsidiaries and the Holding Company to be administered by the Nomination and Remuneration Committee of the Board of Directors of the Company. ESOP Scheme 2010 provides an incentive to attract, retain and reward the employees and enable them to participate in future growth and financial success of the Company. Each option confers a right upon the employee to apply for one equity share of the Company.

During the year under review, 120,469 Stock Options have vested with the specified employees of the Company and its subsidiary (ies) under the ESOP Scheme 2010 and 403,895 Stock Options have lapsed till 31 March 2015. As on 31 March 2015, none of the Options have been exercised.

The particulars with regard to ESOP scheme as on 31 March 2015, as required to be disclosed pursuant to the provisions of Rule 12(9) of the Companies (Share Capital & Debentures) Rules, 2014 are set out in Annexure V to this Report.

A Certificate from the Statutory Auditors with regard to the implementation of ESOP Scheme 2010 would be placed at the forthcoming Annual General Meeting.

DEPOSITS

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

CONSOLIDATED FINANCIAL STATEMENT

In terms of Clause 32 of the Listing Agreement with Stock Exchanges, Consolidated Financial Statement, conforming to Accounting Standard 21 issued by the Institute of Chartered Accountants of India, is attached as a part of the Annual Report.

CORPORATE GOVERNANCE

The Company is committed in maintaining the highest standards of Corporate Governance and adheres to the stipulations prescribed under Clause 49 of the Listing Agreement with the Stock Exchanges. A Report on Corporate Governance & Shareholder Information together with the Auditors' Certificate thereon is annexed as part of the Annual Report.

MANAGEMENT DISCUSSION & ANALYSIS

A detailed analysis of the Industry and Company Outlook, Company's operations, project review, risk management, strategic initiatives and financial review & analysis, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges is presented under a separate section titled "Management Discussion and Analysis" forming part of the Annual Report.

EXTRACT OF THE ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT 9 as per provisions of Companies Act, 2013 and rules thereto is annexed to this report as Annexure VI.

VIGIL MECHANISM (WHISTLE BLOWER POLICY)

The Company has a Vigil Mechanism / Whistle Blower Policy to deal with instances of fraud and mismanagement, if any. The policy provides for adequate safeguards against victimization of employees and / or Directors and also provides for direct access to the Chairman of the Audit Committee. The Policy is uploaded on the website of the Company at : www.visasteel.com.

CORPORATE SOCIAL RESPONSIBILITY POLICY

The Corporate Social Responsibility (CSR) policy recommended by the Corporate Social Responsibility Committee had been approved by the Board of Directors. The CSR policy is available on the website of the Company at: www.visasteel.com and is also attached to this report as Annexure VII.

During the year, the CSR initiatives undertaken by the Company, although not mandatory under Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules 2014, are detailed in the Annual Report.

NOMINATION AND REMUNERATION POLICY

In terms of the requirement of Section 178 of the Companies Act, 2013, on the recommendation of the Nomination and Remuneration Committee, the Board has approved the Nomination and Remuneration policy of the Company. The Nomination and Remuneration policy is attached to the Board's Report as Annexure VIII.

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

The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Company has not received any complaint of sexual harassment during the financial year 2014-15.

ACKNOWLEDGEMENT

Your Directors record their sincere appreciation for the assistance, support and guidance provided by banks, financial institutions, customers, suppliers, regulatory & government authorities, project & other business associates and stakeholders. The Directors also commend the continuing commitment and dedication of the employees at all levels which has been critical for the Company's growth. The Directors look forward to their continued support in future.

Your Directors value your involvement as shareholders and look forward to your continuing support.

For and on behalf of the Board



Vishal Agarwal

Vice Chairman & Managing Director



Kolkata Manoj Kumar Digga

13 November 2015 Whole time Director designated as Director

(Finance) & Chief Financial Officer


Mar 31, 2013

Dear Shareholders,

The Directors are pleased to present this Seventeenth Annual Report together with the Audited Statement of Accounts for the year ended 31 March 2013.

FINANCIAL RESULTS

(Rs. Million)

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

Net Revenue 5,157.58 7,943.46 10,192.43 13,659.05

Other Income 167.92 212.74 251.24 262.48

Total Income 5,325.50 8,156.20 10,443.67 13,921.53

Profit before interest, depreciation, tax & exceptional item (286.55) 1,598.12 (67.07) 1,060.80

Finance Cost 1,258.81 1,465.49 1,684.37 1,896.68

Depreciation 524.77 385.62 652.08 511.93

Profit / (Loss) before Exceptional Item and Taxation (2,070.13) (252.99) (2,403.52) (1,347.81)

Exceptional Item 1,620.04 33.06 1,365.33 (617.27)

Profit /(Loss) before Tax of Continuing Operation (450.09) (219.93) (1,038.19) (1,965.08)

Taxation - Current 0.07 (0.01)

- MAT Credit Entitlement (179.30) (179.30)

- Deferred (597.01) 74.74 (597.00)

Profit / (Loss) after Tax of Continuing Operation (450.09) 556.38 (1,113.00) (1,188.77)

Profit /(Loss) before Tax of Discontinuing Operation (584.58)(1,744.92)

Tax Expense of Discontinuing Operation

Operating (Loss) / Profit from discontinued operations (584.58) (1,744.92)

Net Profit on Disposal of Assets and Liabilities of 124.28

Discontinuing Operations

Profit / (Loss) after Tax of Discontinuing Operation (460.30) (1,744.92)

Minority Interest (37.28) 0.02

(Loss) / Profit for the period 910.39)(1,188.54) (1,075.72) (1,188.79)

OPERATIONS

The Company is pursuing Special Steel Business, Ferro Chrome & Captive Power Business and Coke Business. The Special Steel Business includes production of Hot Metal/Pig Iron, DRI/Sponge Iron, Special Steel Blooms/Billets and Bar & Wire Rods. Whereas, the Ferro Chrome Business includes production of High Carbon Ferro Chrome and generation of power for captive use and the Coke Business includes production of Coke and steam. During the year under review, the Company''s financial performance has been adversely affected due to non-availability of raw material, increasing raw material costs and volatile foreign exchange. Due to shortage in availability of iron ore, Iron & Steel making facilities, i.e. Blast Furnace, DRI, SMS & Rolling Mill operated at very low production levels and the Company was unable to achieve its revenue potential.

The consolidated turnover of the Company stood at Rs.10,192.43 million for the Financial Year 2012-13 showing a decline of 25% as compared to Rs.13,659.05 million for the previous year. The operating loss is Rs.67.07 million in the FY''2012-13. The loss after tax is Rs.1,075.72 million for the FY''2012-13 as compared to a loss of Rs.1,188.79 million during the previous financial year.

During the year under review the Company has transferred its Coke Undertaking i.e., business of manufacturing and sale of Metallurgical Coke and Associated Steam Generation Units located at Kalinganagar, Odisha as a going concern on a slump sale basis to VISA SunCoke Limited (formerly VISA Coke Limited). The detailed applicable disclosure relating to "Discontinuing Operation” as per AS-24 as notified by the Central Government under section 211(3C) of the Companies Act, 1956 is given under notes forming part of the financial statements. The production of Coke was 309,565 MT during FY''2012-13 including VISA SunCoke Limited''s production compared to 354,634 MT in the previous year. During the year under review, the Company has entered into a coke making joint venture with Sun Coke Europe Holding B.V. (SunCoke), in which SunCoke has invested approximately Rs.367.50 Crores to acquire 49% of stake in VISA SunCoke Limited (formerly known as VISA Coke Limited) and the remaining 51% is held by the Company.

During the year under review, the Company''s production was severely impacted due to non-availability of Iron Ore. As a result, the Blast Furnace having installed capacity of 225,000 TPA, could produce only 854 MT Pig Iron as compared to 84,454 MT in the previous year. For the same reason, the DRI Plant, having installed capacity of 300,000 TPA, could produce only 80,514 MT Sponge Iron as compared to 157,356 MT in the previous year. The Company is setting up a Iron Ore Sinter Plant in order to hedge the iron ore procurement as it is currently buying only sized iron ore. The Iron Ore Sinter Plant would enhance the profitability of the Blast Furnace and would further reduce the cost of raw material and improve the productivity of the Steel making facilities.

The Ferro Chrome furnaces having installed capacity of 50,000 TPA could produce 36,344 MT High Carbon Ferro Chrome in

2012-2013 as compared to 22,368 MT during the previous year. Production of High Carbon Ferro Chrome was also adversely affected due to inadequate availability and high price of Chrome Ore & Concentrates. The generation of electricity from Company''s Captive Power Plant, having installed capacity of 657 million units per annum, could produce only 312 million units in FY 2012-2013 as compared to 435 million units in the previous year. The reduced generation was largely due to non- availability of gas from Blast Furnace, inadequate availability of waste heat from Coke Oven & DRI Plant.

A detailed analysis of the Company''s operations, project review, risk management, strategic initiatives and financial review & analysis, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges is presented under a separate section titled "Management Discussion & Analysis Report” forming part of the Annual Report.

DIVIDEND

In view of the loss incurred by the Company, your Directors regret their inability to recommend any dividend for the financial year ended 31 March 2013.

CORPORATE DEBT RESTRUCTURING

The Company debts have been restructured under the Corporate Debt Restructuring (CDR) mechanism. Please refer to the "Management Discussions and Analysis” for further details.

TRANSFER OF COKE BUSINESS

Pursuant to the Ordinary Resolution passed by the Shareholders of the Company in terms of the provisions of Section 293(1)(a), of the Companies Act, 1956, by way of Postal Ballot and approval of the CDR EG, the Company has transferred its business of manufacturing and sale of Metallurgical Coke and the Associated Steam Generation Units ("Coke Undertaking”) located at Kalinganagar, Odisha, as identified as a going concern on a slump sale basis (as defined in Section 2(42C) of the Income Tax Act, 1961) to VISA SunCoke Limited (formerly VISA Coke Limited).

SUBSIDIARIES

The Company has seven subsidiaries including indirect subsidiaries namely, VISA BAO Limited, VISA SunCoke Limited, Ghotaringa Minerals Limited, Kalinganagar Special Steel Private Limited, Kalinganagar Chrome Private Limited, VISA Special Steel Limited and VISA Ferro Chrome Limited:

(i) VISA BAO Limited (VBL) is a Joint Venture between the Company and Baosteel Resources Co. Ltd. (Baosteel), China. VBL is setting up a 100,000 TPA Ferro Chrome Plant with 4 Submerged Arc Furnaces of 16.5 MVA each at Kalinganagar in Odisha of which 2 furnaces of 25,000 TPA each were commissioned in the month of June 2013 The remaining two furnaces are expected to be completed in phases by March 2014. The Company holds 65% stake in VBL and Baosteel, which is one of the leading Steel companies in the world, holds the balance 35% stake. The Company and VBL are exploring options for restructuring of VBL''s business and are evaluating the option of amalgamating VBL with the Company. In the meanwhile, as an interim measure, VBL has leased its Plant to the Company.

(ii) VISA SunCoke Limited (VSCL) is a coke making Joint Venture with Sun Coke Europe Holding B.V. (SunCoke), in which the Company holds 51% stake and SunCoke holds remaining 49% stake. The joint venture comprises of 400,000 metric ton per annum heat recovery Coke Plant and Associated Steam Generation units at Kalinganagar in Odisha. The joint venture will provide great opportunity for VSCL to leverage its operating and technological expertise to serve customers across India with the highest quality coke.

(iii) Ghotaringa Minerals Limited (GML) is a Joint Venture between the Company and Orissa Industries Limited (ORIND) for assisting ORIND for developing a chrome ore deposit.

(iv) Kalinganagar Special Steel Private Limited was incorporated on 27 May 2013.

(v) Kalinganagar Chrome Private Limited was incorporated on 1 July 2013.

(vi) VISA Special Steel Limited incorporated on 27 July 2012, became a wholly owned subsidiary of the Company w.e.f. 30 October 2012. Subsequent to the incorporation of Kalinganagar Special Steel Private Limited (KSSPL), a wholly owned subsidiary VSSL has become step down subsidiary of your company through KSSPL.

(vii) VISA Ferro Chrome Limited, a step down subsidiary was incorporated on 27 July 2013.

Further during the year under review, Kalinganagar Metcoke Private Limited (KMPL) was incorporated as a wholly owned subsidiary of the Company on 6 November 2012, which has since been amalgamated with the Company with effect from 31 March 2013 ("Appointed Date”).

The consolidated financial statements presented by the Company include financial information of its subsidiaries prepared in compliance with applicable Accounting Standards. The Ministry of Corporate Affairs, Government of India vide its Circular No. 5/12/2007-CL-III dated 8 February 2011 has granted general exemption under Section 212(8) of the Companies Act, 1956, from attaching the balance sheet, profit and loss account and other documents of the subsidiary companies to the balance sheet of the Company, provided certain conditions are fulfilled. The Board of Directors has, in its meeting held on 1 October 2013, decided not to attach the Balance Sheet and other documents of the subsidiary companies with the annual accounts of the Company. Accordingly, annual accounts of the subsidiary companies will be made available to the investors of the aforesaid subsidiaries and the Company as and when they demand. The Annual Accounts of the subsidiary companies will also be kept for inspection by any investor at the registered office of the Company and these subsidiaries.

Details of the subsidiaries of the Company as required under Circular No. 5/12/2007-CL-III dated 8 February 2011 are covered in this Annual Report.

SCHEME OF AMALGAMATION

The Board of Directors of the Company on 20 April 2013 approved a Scheme of Amalgamation ("the Scheme”) between Kalinganagar Metcoke Private Limited (KMPL), a wholly owned subsidiary of the Company with the Company with effect from 31 March 2013 ("Appointed Date”) to simplify the group structure by elimination of multiple entity with a view to and to achieve administrative efficiency. The Hon''ble High Court of Judicature at Orissa had, vide its Order dated 6 September 2013, sanctioned the scheme of amalgamation of KMPL with the Company.

The Appointed Date of Amalgamation under the Scheme being 31 March 2013, the financials for the year under review have been prepared after giving effect to the Amalgamation.

EXTENSION OF DATE FOR HOLDING ANNUAL GENERAL MEETING OF THE COMPANY

In accordance with provisions of Section 166 read with Section 210 of the Companies Act, 1956 the Annual General Meeting (AGM) of the Company for the financial year ended 31 March 2013, was due to be held on or before 30 September 2013. Pending completion of post amalgamation formalities of KMPL with the Company, available time was not sufficient to complete the consolidated audited financial accounts and to hold the Annual General Meeting before 30 September 2013. The Company approached the Registrar of Companies, Cuttack, Orissa to extend time by three months for holding the Annual General Meeting. Necessary approval was granted by the Registrar of Companies, Orissa vide their letter dated 5 September 2013.

DIRECTORS

At the meeting held on 31 October 2013, the Board of Directors had approved the re-appointment of Mr. Vishambhar Saran as Whole-time Director, designated as Chairman for a period of 3 years with effect from 15 December 2013, pursuant to the provisions of Sections 198, 269, 309, Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956. The appointment and remuneration payable to him require the approval of the Members at the ensuing Annual General Meeting and is subject to other necessary approvals.

Mr. Vishal Agarwal, Managing Director has been re-designated as the Vice Chairman and Managing Director of the Company with effect from 12 December 2012.

Mr. Pankaj Gautam has been appointed as an Additional Director with effect from 12 December 2012 in accordance with Section 260 of the Companies Act, 1956 (the Act). Mr. Gautam holds office only upto the date of the forthcoming Annual General Meeting and a Notice under Section 257 of the Act has been received from a Member signifying his intention to propose Mr. Gautam''s appointment as a Director. The Board has also appointed Mr. Gautam as the Joint Managing Director & CEO effective the same date. The appointment and remuneration payable to him require the approval of the Members at the ensuing Annual General Meeting and is subject to the approval of the Central Government. The Company is also seeking permission of the Central Government for the waiver of recovery of remuneration paid/payable to him for the financial year 2012-13 which is in excess of the remuneration payable in terms of the provisions of the Act.

Mr. Prabir Ramendralal Bose resigned as the Deputy Managing Director and Director of the Company from the close of business hours on 11 December 2012. The Board had placed on record its appreciation of the services rendered by him during his tenure on the Board.

Mr. Vikas Agarwal, Non-Executive Director has resigned from the directorship with effect from 28 April 2012. The Board had placed on record its appreciation for the valuable contribution made by him during his tenure.

In accordance with the Article 157 and 158 of the Articles of Association of the Company, Mr. Maya Shanker Verma and Mr. Shanti Narain, Directors, are liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Brief resume of the above Directors, nature of their expertise in their specific functional areas, details of directorships in other companies and the chairmanship / membership of committees of the Board, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Notice for the forthcoming Annual General Meeting.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

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

b. That the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for that period;

c. That the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

The Company''s internal auditors, M/s. L.B. Jha & Co., Chartered Accountants, have conducted periodic audits to provide reasonable assurance that established policies and procedures are being followed.

CEO / CFO CERTIFICATION

A Certificate from the Mr. Pankaj Gautam, Joint Managing Director & CEO and Mr. Manoj Kumar Digga, Executive Director (Finance), pursuant to Clause 49(V) of the Listing Agreement had been tabled at the Board Meeting held on 1 October 2013 and is also annexed to this Report.

AUDITORS AND AUDITORS'' REPORT

The Auditors of the Company, M/s. Lovelock & Lewes, Chartered Accountants, Kolkata, retire at the conclusion of the ensuing Annual General Meeting and have confirmed eligibility and willingness to accept the office of Auditors, if approved.

The Auditors'' observation in para 10 of the Annexure to the Auditors'' Report for the cash losses incurred in the immediately preceding financial year is self explanatory and does not require any further comments from the Directors.

As regards utilisation of short term funds for long term purposes as observed in para 17 of the Annexure to the Auditors'' Report, your Directors wish to inform that in absence of any arrangement of long term funds to finance additions to the Fixed Assets, the available working funds got depleted resulting in use of short term funds for long term purposes.

COST AUDITORS

The Board of Directors has re-appointed M/s. DGM & Associates, Cost Accountants, the cost auditors for conducting the audit of cost audit records in respect of Steel business for the financial year 2013-14 subject to approval of the Central Government. Application for re-appointment has been approved by the Central Government.

The due date for filing the Cost Audit Reports for the financial year ended 31 March 2012 was 31 March 2013 and the Cost Audit Reports were filed on 27 February 2013.

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

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 in respect of Conservation of Energy and Technology Absorption and Foreign Exchange Earnings and Outgo is given in Annexure I forming part of this Report.

HUMAN RESOURCES

The Company places significant emphasis on recruitment, training & development of human resources, which assumes utmost significance in achievement of corporate objectives. The Company integrates employee growth with organisational growth in a seamless manner through empowerment and by offering a challenging workplace aimed towards realisation of organisational goals. To this effect, your Company has a training centre at its Plant for knowledge-sharing and imparting need based training to its employees. The Company also has in place

a Performance Management System in SAP for performance appraisal of the employees. To ensure accommodation, hospitality and other facilities for its employees, the Company has set up a modern guest house at Kalinganagar.

The information required under Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, and the Companies (Particulars of Employees) Amendment Rules, 2011 are set out in Annexure II to this Report. However, as per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956 read with Clause 32 of the Listing Agreement, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining a copy of the statement may write to the Company.

EMPLOYEES STOCK OPTION

The Company has a ESOP Scheme in place titled Employee Stock Option Scheme 2010 (ESOP Scheme 2010), for permanent employees including any Director, whether whole- time or otherwise, of the Company, its subsidiaries and the Holding Company to be administered by the Remuneration Committee of the Board of Directors of the Company. ESOP Scheme 2010 will provide an incentive to attract, retain and reward the employees and enable them to participate in future growth and financial success of the Company. Each option confers a right upon the employee to apply for one equity share of the Company.

During the year under review, 155,631 Stock Options have vested with the specified employees of the Company and its subsidiary(ies) under the ESOP Scheme 2010 and 264,369 Stock Options have lapsed till 31 March 2013. As on 31 March 2013, none of the Options have been exercised.

The Company has received a certificate from the Auditors of the Company that the ESOP Scheme 2010 was implemented in accordance with the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the resolution passed at the Annual General Meeting held on 17 August 2010. The Certificate would be placed at the forthcoming Annual General Meeting for inspection by the Members.

As required by Clause 12 of SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 information with respect to active Stock Options as on 31 March 2013 is given in a separate statement as Annexure III forming part of this Report.

FIXED DEPOSITS

The Company has not accepted or renewed any fixed deposits under Section 58A of the Companies Act, 1956.

CONSOLIDATED FINANCIAL STATEMENTS

In terms of Clause 32 of the Listing Agreement with Stock Exchanges, Consolidated Financial Statements, conforming to

Accounting Standard 21 issued by the Institute of Chartered Accountants of India, are attached as a part of the Annual Report.

CORPORATE GOVERNANCE

The Company is committed in maintaining the highest standards of Corporate Governance and adheres to the stipulations prescribed under Clause 49 of the Listing Agreement with the Stock Exchanges. A Report on Corporate Governance & Shareholder Information together with the Auditors'' Certificate thereon is annexed as part of the Annual Report.

The Company had also adopted a "Code of Conduct” for its Directors and Senior Management, as required under Clause 49 of the Listing Agreement and all Directors and Senior Managers have affirmed compliance with the Code for 2012-13. A certificate, signed by the Joint Managing Director & CEO, affirming compliance of Directors & Senior Management, forms part of the Report on Corporate Governance.

TRANSFER OF UNPAID/ UNCLAIMED REFUND AMOUNT OF IPO TO IEPF

Pursuant to provisions of Section 205(A)(5) of Companies Act 1956, the amount of refund of IPO, which remain unpaid/ unclaimed for the period of seven years has been transferred by the Company to the Investor Education Provident Fund(IEPF), established by the Central Government, pursuant to Section 205(C) of the said Act.

ACKNOWLEDGEMENT

Your Directors record their sincere appreciation for the assistance, support and guidance provided by banks, financial institutions, customers, suppliers, regulatory & government authorities, project & other business associates and stakeholders. The Directors also commend the continuing commitment and dedication of the employees at all levels which has been critical for the Company''s growth. The Directors look forward to their continued support in future.

Your Directors value your involvement as shareholders and look forward to your continuing support.

For and on behalf of the Board

Vishal Agarwal

Vice Chairman and Managing Director

Kolkata Pankaj Gautam

31 October 2013 Joint Managing Director & CEO


Mar 31, 2012

The Directors are pleased to present this Sixteenth Annual Report together with the Audited Statement of Accounts for the year ended 31 March 2012.

FINANCIAL RESULTS (Rs. Million) Particulars 2011-12 2010-11

Net Revenue 13,659.05 13,236.39

Other Income 259.91 230.06

Total Income 13,918.96 13,466.45

Profit before interest, depreciation & tax 1,060.62 2,376.09

Finance Cost 1,896.68 1,029.49

Depreciation 511.52 482.05

Profit / (Loss) before Exceptional Item and Taxation (1,347.58) 864.55

Exceptional Item (617.27) -

Profit / (Loss) before Taxation (1,964.85) 864.55

Taxation - Current - 182.61

- MAT Credit Entitlement (179.30) (127.74)

- Deferred (597.01) 295.91

Profit / (Loss) after Tax (1,188.54) 513.77

Appropriation - Proposed Dividend - 110.00

- Corporate Tax on Dividend - 17.84

Balance Carried to Balance Sheet (492.51) 696.03

OPERATIONS

The Company is engaged in the business of manufacturing value added products including LAM Coke, High Carbon Ferro Chrome, Pig Iron, Sponge Iron and Special Steel Billets / Blooms, Bars & Wire Rods.

In addition, the Company generates Power mainly for captive use. During the year under review, the Company's financial performance has been adversely affected due to the non-availability of raw material, increasing raw material costs, high bank interest rates and volatile foreign exchange. Due to shortage in availability of iron ore, Iron & Steel making facilities, i.e. Blast Furnace, DRI, SMS & Rolling Mill operated at very low production level and the Company was unable to achieve its revenue potential.

The Company has registered a revenue growth of 3% to Rs.13,918.96 million in the FY'2011-12 compared to Rs.13,466.45 million during the FY'2010- 11. The operating margins decreased to 8% at Rs.1,060.62 million in the FY'2011-12 versus 18% at Rs.2,376.09 million in the previous year. The PBT fell from Rs.864.55 million for the FY'2010-11 to a loss of Rs.1,964.85 million. PAT fell from Rs.513.77 million during the previous financial year to a loss of Rs.1,188.54 million during the FY'2011-12.

During the year under review, the Company's volumes were impacted by the uneconomical prices of Iron Ore & Chrome Ore. The production of Coke was 354,634 MT compared to 340,339 MT in the previous year. The production of High Carbon Ferro Chrome was lower at 22,368 MT compared to 44,372 MT during the previous year. The production of Pig Iron was 84,454 MT compared to 46,233 MT in the previous year. The production of Sponge Iron was 157,356 MT compared to 134,538 MT in the previous year. The captive power generated during the year was 435 million units as against 226 million units in the previous year and Steel production during the year was 45,772 MT.

The Company has decided to set up a 0.5 MTPA Iron Ore Sinter Plant in order to hedge the iron ore procurement as it is currently buying only sized iron ore. This would also ensure continuous smooth running of the Blast Furnace. The Iron Ore Sinter Plant would enhance the profitability of the Blast Furnace and would further reduce the cost of raw material and improve the productivity of the Steel making facilities.

The Company's subsidiary - VISA BAO Limited, is setting up a 100,000 TPA Ferro Chrome Plant with 4 Submerged Arc Furnaces of 16.5 MVA each at Kalinganagar in Odisha. The Company has made significant progress towards implementation of the project and the project is scheduled to be completed in phases during second half of the financial year 2012-13.

A detailed analysis of the Company's operations, project review, risk management, strategic initiatives and financial review & analysis, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges is presented under a separate section titled "Management Discussion & Analysis Report" forming part of the Annual Report.

DIVIDEND

In view of the loss, your Directors regret their inability to declare any dividend for the year.

CORPORATE DEBT RESTRUCTURING

In view of the non-availability and high cost of raw materials reducing EBIDTA margin inspite of which debt and interest was being serviced, additional project cost due to high interest cost, increase in interest cost during construction, high inflation and debt repayment obligations over next two years, your Company proposes to restructure its debt and has approached the Corporate Debt Restructuring Cell for the suitable realignment of its entire debt.

SUBSIDIARIES

The Company has two subsidiaries namely, VISA BAO Limited and Ghotaringa Minerals Limited:

(i) VISA BAO Limited (VBL) is a Joint Venture between the Company and Baosteel Resources Co. Ltd., China. VBL is setting up a 100,000 TPA Ferro Chrome Plant in Odisha.

(ii) Ghotaringa Minerals Limited (GML) is a Joint Venture between the Company and Orissa Industries Limited (ORIND) for assisting ORIND for developing a chrome ore deposit and is awaiting various Government approvals.

The consolidated financial statements presented by the Company include financial information of its subsidiaries prepared in compliance with applicable

Accounting Standards. The Ministry of Corporate Affairs, Government of India vide its Circular No. 5/12/2007-CL-III dated 8 February 2011 has granted general exemption under Section 212(8) of the Companies Act, 1956, from attaching the balance sheet, profit and loss account and other documents of the subsidiary companies to the balance sheet of the Company, provided certain conditions are fulfilled. The Board of Directors has, in its meeting held on 25 May 2012, decided not to attach the Balance Sheet and other documents of the subsidiary companies with the annual accounts of the Company. Accordingly, annual accounts of the subsidiary companies will be made available to the investors of the aforesaid subsidiaries and the Company as and when they demand. The Annual Accounts of the subsidiary companies will also be kept for inspection by any investor at the registered office of the Company and these subsidiaries.

Details of the subsidiaries of the Company as required under Circular No. 5/12/2007-CL-III dated 8 February 2011 are covered in this Annual Report.

DIRECTORS

Mrs. Saroj Agarwal and Mr. Vikas Agarwal, Non-Executive Directors resigned from the directorship with effect from 6 February 2012 and 28 April 2012 respectively. The Board had placed on record its appreciation for the valuable contribution made by them during their tenure.

The tenure of office of Mr. Basudeo Prasad Modi, Deputy Managing Director, in accordance with the terms of his re- appointment, completed on 31 March 2012. Mr. Modi had expressed his desire not to seek re-appointment and had tendered resignation as Director of the Company from close of business hours on 31 March 2012. The Board had placed on record its appreciation of the services rendered by him during his tenure on the Board.

Mr. Prabir Ramendralal Bose has been appointed as an Additional Director with effect from 1 April 2012 in accordance Section 260 of the Companies Act, 1956 (the Act). Mr. Bose holds office only upto the date of the forthcoming Annual General Meeting and a Notice under Section 257 of the Act has been received from a Member signifying his intention to propose Mr. Bose's appointment as a Director. The Board also appointed Mr. Bose as the Deputy Managing Director effective the same date. The appointment and remuneration payable to him require the approval of the Members at the ensuing Annual General Meeting and is subject to the approval of the Central Government.

Mr. Subrato Trivedi has been appointed as an Additional Director with effect from 12 May 2012 in accordance with Section 260 of the Companies Act, 1956. Mr. Trivedi holds office only upto the date of the forthcoming Annual General Meeting and a Notice under Section 257 of the Act has been received from a Member signifying his intention to propose Mr. Trivedi's appointment as a Director.

The Members at the last Annual General Meeting held on 26 July 2011, had re-appointed Mr. Vishambhar Saran, as Whole- time Director designated as Chairman for a period of 3 years with effect from 15 December 2010, re-appointed Mr. Basudeo Prasad Modi as Deputy Managing Director for a period of 1 year with effect from 1 April 2011 and re-appointed Mr. Vishal Agarwal as Managing Director for a period of 3 years with effect from 25 June 2011 pursuant to the provisions of Sections 198, 269, 309, Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956.

The Company is seeking permission of the Central Government for the waiver of recovery of remuneration paid/payable to the Whole-time Director, Managing Director and Deputy Managing Director for the financial year 2011-12 which is in excess of the remuneration payable in terms of the provisions of the Act.

The Remuneration Committee and the Board of Directors have approved payment of remuneration as approved by the Members at the last Annual General Meeting as minimum remuneration irrespective of any profit or loss or the profit not being adequate for payment of such remunerations in terms of Section I or II of Part II of Schedule XIII read with Section 198 and 309 of the Companies Act, 1956, in any financial year during the remaining tenure of the re-appointment of Mr. Vishambhar Saran and Mr. Vishal Agarwal with effect from 1 April 2012. This will require the approval of the Members by a Special Resolution, which forms part of the Notice for the forthcoming Annual General Meeting.

In accordance with the Article 157 and 158 of the Articles of Association of the Company, Mr. Shiv Dayal Kapoor and Mr.

Debi Prasad Bagchi, Directors, are liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Brief resume' of the above Directors, nature of their expertise in their specific functional areas, details of directorships in other companies and the chairmanship / membership of committees of the Board, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Notice for the forthcoming Annual General Meeting.

DIRECTORS' RESPONSIBILITY STATEMENT

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

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

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

c. That the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

The Company's internal auditors, M/s. L.B. ]ha & Co., Chartered Accountants, have conducted periodic audits to provide reasonable assurance that established policies and procedures are being followed.

CEO / CFO CERTIFICATION

A Certificate from the Managing Director and the Chief Financial Officer, pursuant to Clause 49(V) of the Listing Agreement had been tabled at the Board Meeting held on 25 May 2012 and is also annexed to this Report.

AUDITORS AND AUDITORS' REPORT

The Auditors of the Company, M/s. Lovelock & Lewes, Chartered Accountants, Kolkata, retire at the conclusion of the ensuing Annual General Meeting and have confirmed eligibility and willingness to accept the office of Auditors, if approved.

The Auditors' observation in para 10 of the Annexure to the Auditors' Report that the Company has incurred cash losses as at 31 March, 2012 is self explanatory and does not require any further comments from the Directors.

With respect to Auditors' observation under para 11 of the Annexure to the Auditors' Report, your Directors wish to inform that the delay in repayment of principal of Rs.620.76 million and interest of Rs.387.17 million for the period from 1 April 2011 to 31 March 2012, were due to severe liquidity crisis being faced by the Company on account of continued losses incurred during the year, further aggravated by the delay in receipt of expected cash flows on time.

As regards utilisation of short term funds for long term purposes as observed in para 17 of the Annexure to the Auditors'

Report, your Directors wish to inform that in absence of any arrangement of long term funds to finance the cash losses, additions to the Fixed Assets and repayment of long term loans, the available working funds got depleted resulting in use of short term funds for long term purposes.

COST AUDITORS

During the year under review, the Board appointed M/s. DGM & Associates, Cost Accountants, to conduct cost audit of the Company. The Cost Audit Report for the year ended 31 March 2012 is due on 30 September 2012 and shall be submitted within the due time period.

Subject to the approval of the Central Government, the Company has re-appointed M/s. DGM & Associates to audit the cost accounts relating to the products of the Company for the financial year 2012-13.

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

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 in respect of Conservation of Energy and Technology Absorption and Foreign Exchange Earnings and Outgo is given in Annexure I forming part of this Report.

HUMAN RESOURCES

The Company places significant emphasis on recruitment, training & development of human resources, which assumes utmost significance in achievement of corporate objectives.

The Company integrates employee growth with organisational growth in a seamless manner through empowerment and by offering a challenging workplace aimed towards realisation of organisational goals. To this effect, your Company has a training centre at its Plant for knowledge-sharing and imparting need based training to its employees. The Company also has in place a Performance Management System in SAP for performance appraisal of the employees. To ensure accommodation, hospitality and other facilities for its employees, the Company has set up a modern guest house at Kalinganagar.

The information required under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, and the Companies (Particulars of Employees) Amendment Rules, 2011 are set out in Annexure II to this Report. However, as per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956 read with Clause 32 of the Listing Agreement, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining a copy of the statement may write to the Company.

EMPLOYEES STOCK OPTION

The Company has a ESOP Scheme in place titled Employee Stock Option Scheme 2010 (ESOP Scheme 2010), for permanent employees including any Director, whether whole- time or otherwise, of the Company, its subsidiaries and the Holding Company to be administered by the Remuneration Committee of the Board of Directors of your Company. ESOP Scheme 2010 will provide an incentive to attract, retain and reward the employees and enable them to participate in future growth and financial success of the Company. Each option confers a right upon the employee to apply for one equity share of the Company.

During the year under report, 197,344 Stock Options have vested with the specified employees of the Company and its subsidiary, VISA BAO Limited under the ESOP Scheme 2010 and 126,875 Stock Options have lapsed till 31 March 2012. As on 31 March 2012, none of the Options have been exercised.

The Company has received a certificate from the Auditors of the Company that the ESOP Scheme 2010 was implemented in accordance with the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the resolution passed at the Annual General Meeting held on 17 August 2010. The Certificate would be placed at the forthcoming Annual General Meeting for inspection by the Members.

As required by Clause 12 of SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 information with respect to active Stock Options as on 31 March 2012 is given in a separate statement as Annexure III forming part of this Report.

FIXED DEPOSITS

The Company has not accepted or renewed any fixed deposits under Section 58A of the Companies Act, 1956.

CONSOLIDATED FINANCIAL STATEMENTS

In terms of Clause 32 of the Listing Agreement with Stock Exchanges, Consolidated Financial Statements, conforming to

Accounting Standard 21 issued by the Institute of Chartered Accountants of India, are attached as a part of the Annual Report.

CORPORATE GOVERNANCE

The Company is committed in maintaining the highest standards of Corporate Governance and adheres to the stipulations prescribed under Clause 49 of the Listing Agreement with the Stock Exchanges. A Report on Corporate Governance & Shareholder Information together with the Auditors' Certificate thereon is annexed as part of the Annual Report.

The Company had also adopted a "Code of Conduct" for its Directors and Senior Management, as required under Clause 49 of the Listing Agreement and all Directors and Senior Managers have affirmed compliance with the Code for 2011- 12. A certificate, signed by the Managing Director, affirming compliance of Directors & Senior Management, forms part of the Report on Corporate Governance.

ACKNOWLEDGEMENT

Your Directors record their sincere appreciation for the assistance, support and guidance provided by banks, financial institutions, customers, suppliers, regulatory & government authorities, project & other business associates and stakeholders. The Directors also commend the continuing commitment and dedication of the employees at all levels which has been critical for the Company's growth. The Directors look forward to their continued support in future.

Your Directors value your involvement as shareholders and look forward to your continuing support.

For and on behalf of the Board

Vishal Agarwal

Managing Director

Kolkata Prabir Ramendralal Bose

25 May 2012 Deputy Managing Director


Mar 31, 2011

The Directors are pleased to present this Fifteenth Annual Report together with the Audited Statement of Accounts for the year ended 31 March 2011.

Financial Results

(Rs. million) Particulars 2010-11 2009-10

Net Revenue 13,05.01 11,569.42

Other Income 269.78 145.41

Total Income 13,328.79 11,714.83

Profit before interest, depreciation & tax 2,055.98 1,976.36

Interest (Net) 709.38 651.40

Depreciation 482.05 468.18

Profit before Taxation 864.55 856.78

Taxation - Current 182.61 96.00

- MAT Credit Entitlement (127.74) -

- Deferred 295.91 286.62

Profit after Tax 513.77 474.16

Appropriation - Proposed Dividend 110.00 110.00

- Corporate Tax on Dividend 17.84 18.69

Balance Carried to Balance Sheet 696.03 310.10

Operations

The Company is engaged in the business of manufacturing value added products from coal and minerals into LAM Coke, High Carbon Ferro Chrome, Pig Iron, Sponge Iron (DRI) and Special Steel (Long products). In addition, the Company generates Captive Power. During the year under review, production volumes across all Units have been stable and higher price realisation across various products has enabled the Company to register a robust growth in sales revenue. The operating margins of the Company have been stable inspite of higher cost of raw materials such as Coking Coal, Iron Ore, Chrome Ore and Thermal Coal. We continue to drive our cost competitiveness through efficient raw material procurement and captive power generation.

The Company has registered a revenue growth of 14% to Rs. 13,328.79 million in the FY2010-11 compared to Rs. 11,714.83 million during the FY 2009-10. The operating margins decreased to 15% at Rs. 2,055.98 million in the FY2010-11 versus 17% at Rs. 1,976.36 million in the previous year. The PBT was Rs. 864.55 million for the FY2010-11 as against Rs. 856.78 million and PAT was Rs. 513.77 million as against Rs. 474.16 million for the corresponding period.

During the year under review, the Company achieved satisfactory production volumes despite pressure on smooth availability of raw materials. The production of Coke was 340,339 MT compared to 353,601 MT in the previous year. The production of High Carbon Ferro Chrome was slightly lower at 44,372 MT compared to 47,649 MT during the previous year. The production of Pig Iron was 46,233 MT compared to 150,424 MT in the previous year mainly due to non-availability of raw materials owing to closure of OMCs Daitari mines. The production of Sponge Iron was 134,538 MT compared to 139,299 MT in the previous year. The captive power generated during the year was 226 million units as against 223 million units in the previous year.

The Company has achieved completion of 0.5 million TPA Special Steel Plant and 3rd 25 MW Power Plant taking the power generation to 75 MW. This will further boost the Companys growth in revenues and margins.

The Company has decided to set up an Iron Ore Sinter Plant in order to hedge the iron ore procurement as it is currently buying only sized iron ore. This would also ensure continuous smooth running of the Blast Furnace. The Company plans to set up additional Captive Power generation facilities to meet the shortfall in captive power generation vis-à-vis requirements including requirement of its subsidiary VISA BAO Ltd and a Lime Kiln Plant to ensure smooth running of Steel Melt Shop.

The Company has charted a vision for expanding the existing facility at Kalinganagar in Orissa from 0.5 million TPA to 1 million TPA Steel Plant and Power Plant from 75 MW to 375 MW and set up greenfield facility of 1 million TPA Steel Plant and 300 MW Power Plant at Raigarh in Chhattisgarh. The plan is to raise the total Steel production of the Company to 2 million TPA and power generation to 675 MW over the next few years and provide the foundation to maintain high quality growth and enhance value creation for its shareholders.

During the year, the Company has also signed a Memorandum of Understanding (MoU) with the Madhya Pradesh Trade & Investment Facilitation Corporation Ltd. (TRIFAC), a wholly owned undertaking of Government of Madhya Pradesh, for setting up a 1.25 million TPA Integrated Steel Plant with 300 MW Captive Power Plant and 100,000 TPA Manganese Alloy Plant, with a total investment of Rs. 4,025 Crores.

The Companys subsidiary – VISA BAO Limited, is setting up a 100,000 TPA Ferro Chrome Plant with 4 Submerged Arc Furnaces of 16.5 MVA each at Kalinganagar in Orissa. The Company has made significant progress towards implementation of the project.

A detailed analysis of the Companys operations, segment-wise performance, project review, risk management, strategic initiatives and financial review & analysis, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges is presented under a separate section titled "Management Discussion & Analysis Report" forming part of the Annual Report.

Dividend

Your Directors recommend a dividend of 10% for the year ended 31 March 2011, i.e., Rs. 1 per Equity Share in respect of 110,000,000 fully paid up Equity Shares of Rs. 10 each. The total outlay on account of dividend payment will be Rs. 110 million excluding Rs. 17.84 million on account of dividend distribution tax.

Holding Company

Consequent to the inter-se transfer of shareholding between the Promoter Group companies (from VISA Minmetal AG, Switzerland to VISA Infrastructure Limited, India), VISA Infrastructure Limited has become the holding company with effect from 30 April 2010. The shareholding of VISA Infrastructure Limited in the Company is 57,612,167 equity shares of Rs. 10/- each equivalent to 52.37% as on 31 March 2011.

Subsidiaries

The Company has two subsidiaries namely, VISA BAO Limited and Ghotaringa Minerals Limited:

(i) VISA BAO Limited (VBL) is a Joint Venture between the Company and Baosteel Resources Co. Ltd., China. VBL is setting up a 100,000 TPA Ferro Chrome Plant in Orissa.

(ii) Ghotaringa Minerals Limited (GML) has been incorporated to give effect to the joint venture agreement between the Company and Orissa Industries Limited (ORIND) for carrying out the business of mining of chrome ore and/or other minerals. GML has completed prospecting work over an area allotted to ORIND in Dhenkanal, Orissa.

The Companys investment in GML will enable the Company to directly procure chrome ore, mined by GML, for its Chrome Ore Beneficiation Plant, Chrome Ore Grinding Plant and the Ferro Chrome Plant which shall reduce raw material costs significantly.

The Audited Statement of Accounts of VBL and GML for the year ended 31 March 2011 are attached as required under Section 212 of the Companies Act, 1956.

Promoter Group Companies

The names of Promoters and Companies comprising the "Group" as defined in the Monopolies and Restrictive Trade Practices Act, 1969, have been disclosed in the Annual Report for the purpose of

Regulation 3(1)(e) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.

Directors

During the period under Report, Mr. Arvind Pande, Non-Executive & Independent Director retired from the Board of Directors of the Company with effect from 17 August 2010 and Mr. Vivek Agarwal, Non-Executive Director tendered his resignation with effect from 28 January 2011.

The Board places on record its appreciation for the valuable contribution made by them during their tenure.

At the meeting held on 29 October 2010, the Board of Directors had approved the re-appointment of Mr. Vishambhar Saran as Whole-time Director, designated as Chairman for a period of 3 years with effect from 15 December 2010, pursuant to the provisions of Sections 198, 269, 309, Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956. Mr. Sarans re-appointment is subject to the approval of the Members and the said re-appointment together with the remuneration and terms & conditions are proposed in the Notice for the forthcoming Annual General Meeting for your approval.

At the meeting held on 4 February 2011, the Board of Directors had approved re-appointment of Mr. Basudeo Prasad Modi as Deputy Managing Director for a period of 1 year with effect from 1 April 2011, pursuant to the provisions of Sections 198, 269, 309, 316, Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956. Mr. Modis re-appointment is subject to the approval of the Members and the said re-appointment together with the remuneration and terms & conditions are proposed in the Notice for the forthcoming Annual General Meeting for your approval.

At the meeting held on 30 May 2011, the Board of Directors had approved re-appointment of Mr. Vishal Agarwal as Managing Director for a period of 3 years with effect from 25 June 2011, pursuant to the provisions of Sections 198, 269, 309, Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956. Mr. Agarwals re-appointment is subject to the approval of the Members and the said re-appointment together with the remuneration and terms & conditions are proposed in the Notice for the forthcoming Annual General Meeting for your approval.

In accordance with the Article 157 and 158 of the Articles of Association of the Company, Mr. Vikas Agarwal, Mr. Shanti Narain and Mr. Pradip Kumar Khaitan, Directors, are liable to retire by rotation, at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Brief resume` of the above Directors, nature of their expertise in their specific functional areas, details of directorships in other companies and the chairmanship/ membership of Committees of the Board, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Notice for the forthcoming Annual General Meeting.

Directors Responsibility Statement

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

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

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

c. That the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

The Companys internal auditors, M/s. L.B. Jha & Co., Chartered Accountants, have conducted periodic audits to provide reasonable assurance that established policies and procedures are being followed.

CEO / CFO Certification

A Certificate from the Managing Director and the Chief Financial Officer, pursuant to Clause 49(V) of the Listing Agreement had been tabled at the Board Meeting held on 30 May 2011 and is also annexed to this Report.

Auditors and Auditors Report

The Auditors of the Company, M/s. Lovelock & Lewes, Chartered Accountants, Kolkata, retire at the conclusion of the ensuing Annual General Meeting and have confirmed eligibility and willingness to accept the office of Auditors, if approved.

The Auditors qualification under Paragraph 4 of their report read along with the notes to Item no.7 of Schedule 16 is self explanatory and does not require any further comments from the Directors.

As regards utilisation of short term funds for long term purposes as specified in para 17 of the Annexure to the Auditors Report, your Directors wish to submit that the Company was in the stage of implementation of the project. Since the Company has completed the project work, this will be regularised with the operation of the Company.

Particulars of Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 in respect of Conservation of Energy and Technology Absorption and Foreign Exchange Earnings and Outgo is given in Annexure I forming part of this Report.

Human Resources

The Company places significant emphasis on recruitment, training & development of human resources, which assumes utmost significance in achievement of corporate objectives. The Company integrates employee growth with organisational growth in a seamless manner through empowerment and by offering a challenging workplace aimed towards realisation of organisational goals. To this effect, your Company has a training centre at its Plant for knowledge-sharing and imparting need based training to its employees. The Company has also incorporated Performance Management System in SAP for performance appraisal of the employees. To ensure accommodation, hospitality and other facilities for its employees, the Company has set up a modern guest house at Kalinganagar.

The information required under Section 217 (2A) of the Companies Act, 1956 read with the Companies

(Particulars of Employees) Rules, 1975, as amended, and the Companies (Particulars of Employees) Amendment Rules, 2011 are set out in Annexure II to this Report. However, as per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956 read with Clause 32 of the Listing Agreement, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining a copy of the statement may write to the Company.

Employees Stock Option

The Company has rescinded its Employee Stock Option Scheme 2008 under which no Options had been granted and implemented a new ESOP Scheme titled Employee Stock Option Scheme 2010 (ESOP Scheme 2010), for permanent employees including any Director, whether whole-time or otherwise, of the Company, its subsidiaries and the Holding Company to be administered by the Remuneration Committee of the Board of Directors of your Company. ESOP Scheme 2010 will provide an incentive to attract, retain and reward the employees and enable them to participate in future growth and financial success of the Company. Each option confers a right upon the employee to apply for one equity share of the Company.

During the year under report, 900,000 Stock Options were granted to the specified employees of the Company and its subsidiary, VISA BAO Limited under the ESOP Scheme 2010. As on 31 March 2011, none of the Options have been vested. The shares covered by such Options are 900,000.

The Company has received a certificate from the Auditors of the Company that the ESOP Scheme 2010 was implemented in accordance with the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the resolution passed at the Annual General Meeting held on 17 August 2010. The Certificate would be placed at the forthcoming Annual General Meeting for inspection by the Members.

As required by Clause 12 of SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 information with respect to active Stock Options as on 31 March 2011 is given in a separate statement as Annexure III forming part of this Report.

Fixed Deposits

The Company has not accepted or renewed any fixed deposits under Section 58A of the Companies Act, 1956.

Consolidated Financial Statements

In terms of Clause 32 of the Listing Agreement with Stock Exchanges, Consolidated Financial Statements, conforming to Accounting Standard 21 issued by the Institute of Chartered Accountants of India, are attached as a part of the Annual Report.

Corporate Governance

The Company is committed in maintaining the highest standards of Corporate Governance and adheres to the stipulations prescribed under Clause 49 of the Listing Agreement with the Stock Exchanges. A Report on Corporate Governance & Shareholder Information together with the Auditors Certificate thereon is annexed as part of the Annual Report.

The Company had also adopted a "Code of Conduct" for its Directors and Senior Management, as required under Clause 49 of the Listing Agreement and all Directors and Senior Managers have affirmed compliance with the Code for 2010-11. A certificate, signed by the Managing Director, affirming compliance of Directors & Senior Management, forms part of the Report on Corporate Governance.

Acknowledgement

Your Directors record their sincere appreciation for the assistance, support and guidance provided by banks, financial institutions, customers, suppliers, regulatory & government authorities, project & other business associates and stakeholders. The Directors also commend the continuing commitment and dedication of the employees at all levels which has been critical for the Companys growth. The Directors look forward to their continued support in future.

Your Directors value your involvement as shareholders and look forward to your continuing support.

For and on behalf of the Board

Kolkata Vishambhar Saran 30 May 2011 Chairman


Mar 31, 2010

The Directors take immense pleasure in presenting this Fourteenth Annual Report together with the audited accounts of the Company for the year ended 31 March 2010.





FINANCIAL RESULTS

(Rs. Million).

Particulars 2009-10 2008-09

Net Revenue 11,569.42 10,350.06

Other Income 145.41 54.54

Total Income 11,714.83 10,404.60

Profit before interest, depreciation & tax 1,976.36 815.47

Interest (Net) 651.40 321.54

Depreciation 468.18 307.91

Profit before Exceptional Item and Taxation 856.78 186.02

Exceptional Item - Loss on Exchange Fluctuation (net) - 1,184.67

Profit before Taxation 856.78 (998.65)

Taxation - Current 96.00 -

- Deferred 286.62 (334.71)

- Fringe Benefit Tax - 4.20

Profit after Tax 474.16 (668.14)

Appropriation - Proposed Dividend 110.00 -

- Corporate Tax on Dividend 18.69 -

Balance Carried to Balance Sheet 310.10 (35.37)



OPRATIONS

Your Company is engaged in the business of manufacturing Iron and Steel products such as Pig Iron, Coke, Ferro Chrome and Sponge Iron. During the year under review, the increase in production volumes across all Units has enabled the Company to register a robust growth in sales revenue inspite of lower sales realisation of the various products. The lower cost of raw materials such as Coking Coal, Iron Ore and Chrome Ore and better operating eficiencies have resulted in better operating margins. We continue to drive our low cost competitiveness due to our strategic location, eficient raw material procurement and captive power generation.

The outlook for the Iron and Steel Industry in India remains extremely positive as the increase in expenditure by the Government of India in the infrastructure development of the country will boost the demand for Iron & Steel products.

During the year under review, your Company registered substantial growth in production volumes across all operating units. The production of Hot Metal grew 76% to 150,424 MT from 85,457 MT in the previous year. The production of Coke also increased by 7% to 353,601 MT compared to 331,128 MT in the previous year. The production of Ferro Chrome registered a staggering growth of 92% to 47,649 MT in comparison to 24,815 MT during the previous year. The Sponge Iron Plant produced 139,299 MT of Sponge Iron during 2009-10 as against 28,370 MT of Sponge Iron during 2008-09. The power generated during the year was 223 million units as against 39 million units in the previous year, an increase of over 472% and was used mainly for captive consumption.

Your Company has registered a revenue growth of over 13% amounting to Rs.11,714.83 million in FY’ 2009-10 compared to Rs.10,404.60 million during the FY’ 2008-09. The operating margins increased by 142% at Rs.1,976.36 million in FY’ 2009- 10 as against Rs.815.47 million in the previous year. The PBT was Rs.856.78 million for FY’ 2009-10 as against loss of Rs.998.65 million and PAT was Rs.474.16 million as against loss of Rs.668.14 million for the corresponding period.

The Company is in the final stages of completing project work on the 0.5 million TPA Steel Melt Shop, 0.5 million TPA Bar and Wire Rod Mill and 3rd 25 MW Power Plant and expects to commence production by December 2010. This will further boost the Company’s growth in revenues and margins.

Your Company has started preparatory work for expanding the existing facility at Kalinganagar in Orissa from 0.5 million TPA to 1 million TPA Steel Plant and Power Plant from 75 MW to 375 MW and set up greenfield facility of 1 million TPA Steel Plant and 300 MW Power Plant at Raigarh in Chhattisgarh. The plan is to raise the total Steel production of the Company to 2 million TPA and power generation to 675 MW over the next few years and provide the foundation to maintain high quality growth and enhance value creation for its shareholders.

The Company’s subsidiary – VISA BAO Limited, has initiated steps for implementation of a 100,000 TPA Ferro Chrome Plant at Kalinganagar in Orissa.

A detailed analysis of your Company’s operations, segment- wise performance, project review, risk management, strategic initiatives and financial review & analysis, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges is presented under a separate section titled “Management Discussion & Analysis Report” forming part of the Annual Report.

DIVIDEND

In view of the performance of your Company, your Directors recommend a dividend of 10% for the year ended 31 March 2010 i.e., Rs.1 per Equity Share in respect of 110,000,000 fully paid up Equity Shares of Rs.10 each. The total outlay on account of dividend payment will be Rs.110 million excluding Rs.18.69 million on account of dividend distribution tax.

HOLDING COMPANY

Subsequent to the inter-se transfer of shareholding between the Promoter Group companies i.e. from VISA Minmetal AG to VISA Infrastructure Limited, VISA Infrastructure Limited has become the holding company of your Company with efect from 30 April 2010.

SUBSIDIARIES

Your Company has two subsidiaries namely, VISA BAO Limited and Ghotaringa Minerals Limited:

(i) VISA BAO Limited (VBL) is a Joint Venture between your Company and Baosteel Resources Co. Ltd., China. VBL has initiated steps for implementation of a 100,000 TPA Ferro Chrome Plant in Orissa.

(ii) Ghotaringa Minerals Limited (GML) has been incorporated to give efect to the joint venture agreement between your Company and Orissa Industries Limited (ORIND) for carrying out the business of mining of chrome ore and/or other minerals. GML is currently carrying out drilling & prospecting work over an area allotted to ORIND in Dhenkanal, Orissa.

Your Company’s investment in GML will enable the Company to directly procure chrome ore, mined by GML, for its Chrome Ore Beneficiation Plant, Chrome Ore Grinding Plant and the Ferro Chrome Plant which shall reduce raw material costs significantly.

The audited accounts of VBL and GML for the year ended 31 March 2010 are attached as required under Section 212 of the Companies Act, 1956.

PROMOTER GROUP COMPANIES

The names of Promoters and Companies comprising the * Group” as defined in the Monopolies and Restrictive Trade Practices Act, 1969, have been disclosed in the Annual Report for the purpose of Regulation 3(1)(e) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.

DIRECTORS

In accordance with the Article 158 of the Articles of Association of the Company, Mr. Debi Prasad Bagchi and Mr. Maya Shanker Verma, Directors, are liable to retire by rotation, at the ensuing Annual General Meeting and being eligible, ofer themselves for re-appointment.

Mr. Arvind Pande, who is also due to retire at the forthcoming Annual General Meeting, had informed the Company that he does not wish to seek re-appointment. A resolution pursuant to Section 256 of the Companies Act, 1956, for not filling the vacancy caused by the retirement of Mr. Arvind Pande has been included in the Notice of the 14th Annual General Meeting. The Board has taken on record the immense contribution made by Mr. Pande during his tenure as a Director of the Company.



DIRECTORS RESPONSIBLITY STATEMENT



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

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

b. That the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of afairs of the Company at the end of the financial year and of the profit of the Company for that period;

c. That the Directors had taken proper and suficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

Your Company’s internal auditors, M/s. L.B. Jha & Co., Chartered Accountants, have conducted periodic audits to provide reasonable assurance that established policies and procedures are being followed.

CEO/CFO CERTIFICATION

A Certificate from the Managing Director and the Chief Financial Oficer, pursuant to Clause 49(V) of the Listing Agreement had been tabled at the Board Meeting held on 19 May 2010 and is also annexed to this Report.

AUDITORS

The Auditors of the Company, M/s. Lovelock & Lewes, Chartered Accountants, Kolkata, retire at the conclusion of the ensuing Annual General Meeting and have confirmed eligibility and willingness to accept the ofice of Auditors, if approved.

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

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 in respect of Conservation of Energy and Technology Absorption and Foreign Exchange Earnings and Outgo is given in Annexure I forming part of this Report.

HUMAN RESOURCES

Your Company places significant emphasis on recruitment, training & development of human resources, which assumes utmost significance in achievement of corporate objectives. Your Company integrates employee growth with organisational growth in a seamless manner through empowerment and by ofering a challenging workplace, aimed towards realisation of organisational goals. To this efect, your Company has a training centre at its Plant for knowledge-sharing and imparting need based training to its employees. The Company has also incorporated Performance Management System in SAP for performance appraisal of the employees. To ensure accommodation, hospitality and other facilities for its employees, your Company has set up a modern guest house at Kalinganagar.

The information required under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended are set out in Annexure II to this Report. However, as per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956 read with Clause 32 of the Listing Agreement, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining a copy of the statement may write to the Company.

EMPLOYEES STOCK OPTION

Your Company had introduced an Employee Stock Option Scheme by the name “Employee Stock Option Scheme 2008” (the “Scheme”) for permanent employees including any Director of the Company, whether whole-time or otherwise, of the Company to be administered by the Remuneration Committee of the Board of Directors of your Company.

Information as per Clause 12 of SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999 is given in a separate statement as Annexure-III forming part of this Report.

The Board of Directors of your Company has proposed rescinding the existing Scheme and introducing a new Scheme (ESOP Scheme 2010) in accordance with the SEBI Guidelines. Accordingly, appropriate resolutions are being moved at the ensuing Annual General Meeting which the Board recommends for your approval.

FIXED DEPOSITS

Your Company has not accepted or renewed any fixed deposits under section 58A of the Companies Act, 1956.

CONSOLIDATED FINANCIAL STATEMENTS

In terms of Clause 32 of the Listing Agreement with Stock Exchanges, Consolidated Financial Statements, conforming to Accounting Standard 21 issued by the Institute of Chartered Accountants of India, are attached as a part of the Annual Report.

CORPORATE GOVERNANCE

Your Company is committed in maintaining the highest standards of Corporate Governance and adheres to the stipulations prescribed under Clause 49 of the Listing Agreement with the Stock Exchanges. A Report on Corporate Governance & Shareholder Information together with the Auditors’ Certificate thereon is annexed as part of the Annual Report.

Your Company had also adopted a “Code of Conduct” for its Directors and Senior Management, as required under Clause 49 of the Listing Agreement and all Directors and Senior Managers have afirmed compliance with the Code for FY’ 2009-10. A certificate, signed by the Managing Director,

afirming compliance of Directors & Senior Management, forms part of the Report on Corporate Governance.

ACKNOWLEDGEMENT

Your Directors record their sincere appreciation for the assistance, support and guidance provided by banks, financial institutions, customers, suppliers, regulatory & government authorities, project & other business associates and stakeholders. Your Directors also thank the employees of the Company for their contribution and commitment towards your Company performance and growth during the period under review.

Your Directors value your involvement as shareholders and look forward to your continuing support.



For and on behalf of the Board



Vishal Agarwal Managing Director

Kolkata Basudeo Prasad Modi

12 July 2010 Deputy Managing Director

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