Directors Report of Metkore Alloys & Industries Ltd.

Mar 31, 2015

The Directors are pleased to present the Ninth Annual Report and the company's audited financial statement for the Financial Year ended March 31, 2015.

FINANCIAL RESULTS

The company's financial performance for the year ended March 31, 2015 is summarized below:

Rs. in lakhs

Particulars 2014-15 2013-14

PROFIT BEFORE TAX 252.43 1463.14 Less: Current tax

Deferred tax (84.02) (48.26)

PROFIT FOR THE YEAR 336.45 1511.40

Add: Balance in Profit and Loss Account 5532.24 4200.68

Sub-total 5868.69 5712.08 LESS: Appropriation General Reserves

Proposed Dividend -- 69.21

Proposed Dividend on equity -- 84.51

Corporate Dividend Tax - Preference -- 11.76

Corporate Dividend Tax Equity -- 14.36

Adjustment relating to Fixed Assets -- ---

Total 5868.69 5532.24

DIVIDEND

The Board of Directors of the Company have not recommended any dividend on the equity shares in view of financial health of the Company and the need for conserving and sloughing back the funds in the business for modernization /expansion activities.

OPERATIONAL REVIEW

Gross revenues decreased to Rs.28838.61 lacs, a short fall of around 18% against Rs.34158.44 lacs in the previous year due to sluggish market conditions and effect of hudhud cyclone in the coastal area of Andhra Pradesh. Profit before depreciation and taxation was Rs.537.97 lacs against Rs.1717.65 lacs in the previous year and the profit after providing for depreciation and taxation of Rs.336.15 lacs against Rs.1511.40 lacs in the previous year.

The Company is expecting bright prospectus for the Ferro Alloys Products due to Government policies and encouragement to the infrastructure project. Moreover, the Company tied up with Harsco for recovery of Metal from the slag which is accumulated over years. Harsco installed the required equipment adjacent to company's plant and commenced its operations from December 2014 for recovery of Metal from the slag. These operations are under stabilization and once it is streamlined, the Company will derive the benefits by way of additional income to the Company.

FIXED DEPOSITS

No fresh / renewal of deposits were accepted during the financial year 2014-15.

DIRECTORS' RESPONSIBILITY STATEMENT Section (5) 134

Your Directors confirm that :

- In the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

- They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profits of the Company for that period;

- They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

- They have prepared the annual accounts on a going concern basis;

- They have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and

- They have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

The Company's Internal Auditors have conducted periodic audit to provide reasonable assurance that the company's established policies and procedures have been followed. The Audit Committee constituted by the Board reviews the internal control and financial reporting issues with Internal Auditors.

MANAGEMENT DISCUSSIONS AND ANALYSIS

a. Industry structure and developments

Steel is the most versatile material, which has made the progress in every aspect on this earth possible. Numerous varieties of steel are required with specific properties to suit different applications and to get the most optimum usage. Hence, the basic constituent of steel is Iron, in proportion of other elements in it, which gives each type of steel certain specific properties. These elements known as Ferro Alloys are added to molten iron to get the desired composition and properties. Thus Ferro Alloys are important additives in the production of steel and as such ferro alloys industry's growth and development is linked to that of the steel industry.

The year witnessed a marked slowdown in global growth. Emerging markets were characterized by a sharp fall in growth rates especially in China, Europe and Japan continued to be under pressure through the year, while US showed tepid signs of improvement.

The performance, during the year, of your Company may be analyzed from the above impact.

The sales have come down to Rs.288 crore comparing to last year Rs.341 crore. Export sales have come down to Rs.14 crore against last year Rs.35 crore.

b. Opportunities and Threats

The key end-user of Ferro chrome is stainless steel and alloy steel industry with a share of 90% of Ferro chrome consumption. The growth of stainless steel is predominantly driven by the growth in its end user segments. The low consumption of stainless steel can be attributed to

- Lack of awareness about its use and benefits

- Non-availability of skilled fabricators

- User developed production technology

This low per capita consumption of stainless steel in India presents immense opportunities for growth in Indian Stainless Steel market. The micro drivers for the growth of Indian stainless industry are-

- Per capita income growth

- Higher GDP growth

- Huge investment by Indian Government in infrastructure

- New stainless steel application identification

As every industry facing threats, ferro alloys industry is not barred from this. Threats like substitution of products and importing at cheaper rates.

c. Segment-wise or product-wise performance

The Company has only one segment Iron & steel, Ferro Alloys Products. During the year, under review, the Company introduced the production of Ferro Silicon, Silico Manganese . The overall production comparing last year production was dropped due to Hudhud cyclone and other factors .

d. Outlook

The steel has recorded high growth rates in both production and consumption over the past few years benefiting from soaring steel demand in automobile and construction sectors before the recession. Moreover, cost effective and highly efficient steel making technologies have lifted the demand from US to the Middle Eastern and Asian countries.

Stainless steel is the largest consumer of Ferro chrome and as such a change in the dynamics of the stainless steel industry has impact of Ferro chrome industry. According to ISSF and KMPG, the recent significant improvement in global stainless steel consumption comes on account of global economic recovery and strong end user demand.

Risks and concerns

The global economic climate continues to be volatile, uncertain and prone to geo-political risks. The marked slowdown in global markets is expected to continue in 2015. The divergence in developed market growth as a result of the US recovery is expected to add to the volatility in the currency markets. In this global backdrop, India is expected to perform better, aided by improving macroeconomic fundamentals. However, execution of the reform and kick starting the investment cycle will be the key determinants of India's economic performance. Currently inflation is benign, upside pressures on inflation from the vagaries of monsoon or sudden changes in the rupee, could have a significant bearing on inflation.

e. Internal control systems and their adequacy

Internal control is an essential part of corporate governance and any weakness or inadequacy can have a greater impact on the profit of the Company. The Company remains committed in its endeavor to ensure an effective internal control environment that provides assurance on the efficiency and effectiveness of operations, reliability of financial reporting, statutory compliance and security of assets.

The Company has a well established and robust internal control systems and processes in place to ensure smooth functioning of the operations.

f. Discussion financial performance with respect to operational performance

The production during the year has dropped due to Hudhud cyclone and sluggish market conditions. The input costs raw material, freights and other overheads increased, whereas prices of Finished Goods not increased commensurate with the input costs. The finance cost Rs.724.66 lacs slightly increased comparing last year's Rs.694.93 lacs .

g. Material development in Human Resources /Industrial front, including number of people employed Your company is value based organization with a culture that promotes empowerment and freedom. In a challenging and competitive environment, the organization believes people are key to success.

Research and Development

Your Company continues to derive sustainable benefit from the tradition of Research & Development and many such innovation has helped significantly to develop for better product with cost effective.

Technology Absorption

The Company maintains interaction with experts globally which has facilitated for better management. Periodical up gradation of Technology and new developments in the industry.

Environment, Safety, Health and Energy Conservation

Your Company has a vision of being 'Zero' accident plant. This has been achieved through a combination of training and hardware up gradation leveraging core technology concepts and safety standards.

Corporate Governance

Your Company is renowned for exemplary governance standards over the years and continue to lay a strong emphasis on transparency, accountability and integrity.

Your Company has in place all the statutory committees required under the law. Details of Board committees along with their terms of reference, composition and meetings of the Board and Committees held during the year are provided in the Corporate Governance Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is attached to this report Annexure 'A'.

Corporate Social Responsibility (CSR)

During the year, your Company has adopted new policies and amended existing policies such as Policy on related Party transaction, CSR Policy and Whistle Blower Policy in line with the new governance requirements. The Company has established a vigil mechanism for Managing Director/Whole-time Directors and employees to report their genuine concerns and details are given in the Corporate Governance Report attached to this report Annexure 'B'.

The Company has identified neighboring villages in and around Ravivalasa for solutions for developing infrastructure viz., Road, drinking water supply, quality education, providing computers and addressing poverty, hunger and malnutrition.

During the year, the Company has spent Rs.78.58 lakhs [around 2.71% of the average net profits of last three financial years ] on CSR activities is annexed herewith to this report - Annexure 'C'.

Risk Management

During the year, your Directors have constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board in overseeing and approving company's enterprise wise risk management framework and risk that the organization faces. The strategic, financial, liquidity, legal, regulatory and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

Secretarial Auditor

During the year, Secretarial Audit was carried out by Sri Ramaswamy K, Company Secretary in Practice, the Secretarial Auditor of the Company for the financial year 2014-15. There were no qualification, reservation or adverse remarks given by the Secretarial Auditor and the report is appended to this report - Annexure 'D'.

Extract of Annual Return

The extract of annual return in Form MGT 9, as required under Section 92(3) and rule 12 of the Companies [Management and Administration] Rules, 2014, is appended to this report - Annexure 'E'.

Related Party Transactions

In line with requirements of the Companies Act, 2013 and listing agreement, proper reporting, approval and disclosure process are in place for all transactions between related parties and the Company. All transactions entered were in ordinary course of the business and on arm's length basis. No material related party transactions i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements were entered during the year. Accordingly, related party transactions, as required under section 134(3)(h) of the Companies Act, 2013, in Form AOC 2 is not applicable.

Board of Directors and Key Managerial Personnel

During the year, the Board appointed Sri Chikali Nagarju as Whole-time Director and Smt Sarita Boorugu as an Additional Director with effect from 13.11.2014 and 17.06.2015 respectively. Smt Sarita Boorugu hold office up to the date of forthcoming AGM and being eligible, offered herself to be appointed as Director.

The Independent Directors have given the certificate of Independence to your Company stating that they meet the criteria of independence as mentioned under Section 149, 161 of the Companies Act, 2013.

The details of training and familiarization programmes and annual board evaluation process for directors have been provided under the Corporate Governance Report.

Statutory Auditors

M/s Nekkanti Srinivasu & Company [Firm Regn No. 008801S] were appointed as Statutory Auditors by the members for three years and hold office till the conclusion of the ensuing AGM and are eligible for re-appointment. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment.

Cost Auditor

M/s Krishna Mohan Reddy, Cost Accountants carried out the cost audit during the year. The Board of Directors have appointed M/s. Jithendra Kumar & Company, Cost Accountants for the year 2015-16.

Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required under the Act, is attached to this report - Annexure 'F'.

Human Resources

Your Company's human resources remained focused on reinforcing the key thrust areas viz., building strong, talent and capabilities in the Company, driving greater employee engagement and continuing focus on progressive employee relation policies to develop them as future leaders.

None of the employees is covered for disclosures, as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Disclosures with respect to the remuneration of Directors and employees, as required under Section 197 of Companies Act, 2013 and Rule 5(1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, has been appended as annexure to the repor t.

Details of employees remuneration, as required under Section 197 of Companies Act, 2013 and Rule 5(1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the Registered Office of the Company during working hours before 21 days of AGM and shall be made available to any shareholder on request.

General

Your Directors state that no disclosure of reporting is required in respect of the following items as there were no transactions on these items during the year, under review:

a. Details relating to deposits covered under Chapter V of the Act

b. Issue of equity shares with differential rights as to dividend, voting or otherwise

c. Issue of shares [including sweat equity shares] to employees of the Company under any scheme

d. Neither the MD nor the whole-time Director of the Company receive any remuneration or commission from any of subsidiaries

e. No significant or material orders were passed by the Regulators or Courts or Tribunal which impact the going concern status and Company operations in future.

Appreciation and Acknowledgement

Your Directors place on record their deep appreciation to employees, at all levels, for their hard work, dedication and commitment.

Your Directors also like to acknowledge the excellent support and co-operation your Company has been receiving from its bankers, suppliers, stakeholders, investors, clients, vendors, Government and Regulatory authorities.

For and on behalf of the Board of Directors

S. Gajendran

Bengaluru Chairman of the Meeting and Non Executive Independent Director

August 14, 2015 DIN: 00250136

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Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Eighth Annual Report and Audited Accounts for the year ended March 31, 2014:

FINANCIAL RESULTS

(Rs. In Lakhs)

Particulars 2013-14 2012-13

Total Sales 34158.44 22313.26

Profit before Interest and Depreciation 2412.57 2074.10

Interest 694.93 639.56

Depreciation 254.51 251.27

Profit before tax 1463.14 1183.27 Income tax expenses

* Current Tax - -

* Deferred Tax (48.26) (0.94)

Profit after tax 1511.40 1184.21

Balance brought forward from previous years 4200.68 3179.83

Balance available for appropriations 5712.08 4364.04

Preference Dividend 69.21 69.21

Proposed Dividend on equity 84.51 70.43

Corporate Dividend tax - Preference 11.76 11.76

Corporate Dividend tax - Equity 14.36 11.97

Balance carried forward to Balance Sheet 5532.24 4200.68

DIVIDEND

The Board of Directors of your Company has recommended a dividend of Rs.0.12 per equity shares of Rs.2/- each. The dividend, if approved at the ensuing Annual General meeting, will be paid to those shareholders whose names appear on the Register of Members as on the Book Closure date.

OPERATIONS AND PERFORMANCE

The Company continued to be among well performed companies in High Carbon Ferro Alloys in India with sales of Rs 34150.85 lakhs, Profit after tax stood at Rs 1463.14 lakhs. The Company continue to focus for improving margins through innovative product development, better product mix, emphasis on branded products and control on cost. Significant measures have been taken for simplification of process and structures which will result in improvement in productivity and efficiency across the organization.

Your Directors inform that Scheme of arrangement between the Company and Ferro Division of Sri Vasavi Industries Limited is before the Hon''ble High Court of Andhra Pradesh, Hyderabad.

REGULATORY ISSUES :

The company entered into a Trading Agreement with National Spot Exchange Ltd ( NSEL) and sold Ferro chrome stocks through Trading Platform . The company is having repurchase obligation for the stocks sold through NSEL platform . However the exchange was suspended and repurchase obligation could not be completed to the extent of 14243 mts of Ferro Chrome as on the date of Balance sheet.

The company is of the opinion that the transactions with NSEL are within the norms of required regulations and there would be no negative effect on the financial of the company .

DIRECTOR

Consequent to resignation of Smt Sarita Boorugu, S/shri S Venkataraman, Rajiv Saxena and K Mallikarjuna Rao ceased to be Directors w.e.f. 04.09.2013, 30.09.2013, 19.10.2013 and 28.10.2013 respectively.

Sri AVL Narasimham was appointed as Director in Casual Vacancy consequent to the resignation of Sri S Venkatraman w.e.f. 13.11.2013.

Pursuant to Section 152 of the Companies Act, 2013 and Articles of Association of the Company, Sri S Gajendran, retire by rotation and being eligible, offers himself for re-appointment.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

i. In the preparation of the annual accounts, the applicable accounting standards have been followed, along with proper explanation relating to material departures, wherever applicable.

ii. The Directors have selected such accounting policies and applied them consistently and made judgements 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 the end of the accounting year and of the profit of the Company for the period.

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

iv. The Directors have prepared the annual accounts on a going concern basis.

SOCIAL RESPONSIBILITY

As a Socially Responsible Corporate Citizen , the company has been providing water supply to nearby Ravivalasa village and provided street lamps. The Company constructed class room in MPP School at Ravivalasa. Fixed PVC Wire nets to all rooms of Integrated Welfare Hostel complex at Tekkali. Cleaning up of Vamsadara canal in the near by area and provided Ghats for bathing purposes. The company contributed generously to Chiccolu Chirudivvelu, (a scheme for education of poor students) at Srikakulam. contribution made to Kabadi Tournament conducted by ZPH School, Nandigam.

CORPORATE GOVERNANCE

Report on Corporate Governance and Certificate of Auditors of the Company for the due Compliance of Code of Corporate Governance pursuant to Clause 49 of the Listing Agreement forms part of this Report.

LISTING AT STOCK EXCHANGES

The equity shares of the Company continue to be listed on Bombay Stock Exchange Limited and The National Stock Exchange of India Limited. The annual listing fees for the year 2014-15 has been paid.

DISCLOSURE OF PARTICULARS

The information relating to Conservation of Energy, Technical Absorption, Foreign Exchange Earnings and Outgo pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies [Disclosure of Particulars in the report of the Board of Directors] Rules, 1988 is forming part of this repsort.

FIXED DEPOSIT

The Company has not invited / received any fixed deposits during the period.

COST AUDIT

Sri Krishna Mohan Bojanapalli, Cost Accountant was appointed as the Cost Auditor of the Company and their Audit Report on Cost Accounts of the Company for the period ended March 31, 2014 will be filed within the stipulated time limit.

AUDITORS

M/s Nekkanti Srinivasu & Company, Chartered Accountants, retire as Auditors of the Company at the conclusion of this Annual general Meeting and are eligible for re-appointment. Based on the recommendation of the Audit Committee, the Board of Directors of the Company have proposed the appointment of M/s Nekkanti Srinivasu & Company, Chartered Accountants as the Auditors of the Company from the Conclusion of the ensuing Annual General meeting till the conclusion of next Annual General meeting. M/s Nekkanti Srinivasu & Company, Chartered Accountants have expressed their willingness to act as Auditors of the Company, if appointed, and have further confirmed that the said appointment would be in conformity with the provisions of Section 141 of the Companies Act, 2013.

INDUSTRIAL RELATIONS

During the year, under review, Industrial relations at the Manufacturing complex remain cordial.

PARTICULARS OF EMPLOYEES

None of the employees is covered under Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended.

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the service rendered by the Executives, Staff and Workers during the year, under review. Your Directors also appreciate the support received from Banks, Central and State government Authorities, Regulatory Authorities, Customers, Suppliers, Shareholders and Investors at large for their continued support and confidence.

On behalf of the Board of Directors

Dated : 29.05.2014 S Gajedran Place : Bangalore Chairman of the Meeting Non-Executive Independent Director DIN:00250136

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Mar 31, 2013

To the Members,

The Directors are pleased to present their Seventh Annual Report of the Company together with the Audited Accounts for the year ended March 31, 2013.

FINANCIAL RESULTS (Rs. In Lakhs)

Particulars 2012-13 2011-12

Total income 22313.26 25067.89

Profit before interest and depreciation 2074.10 2675.07

Interest 639.56 635.39

Depreciation 251.27 260.69

Profit before tax 1183.27 1779.06

Provision for

- Current Tax

- Deferred Tax (0.94) 24.68

Profit after tax 1184.21 1754.38

Balance brought forward from previous year 3179.83 1577.27

Balance available for appropriations 4364.04 3331.65 Preference Dividend 69.21 69.21 Proposed Dividend on equity 70.43 61.43 Corporate Dividend Tax-Preference 11.76 11.23 Corporate Dividend Tax-Equity 11.97 9.96 Balance carried forward to Balance Sheet 4200.68 3179.85

DIVIDEND:

Your Directors are pleased to recommend a dividend of Re. 0.10 per equity share of Rs.2/- each on 7,04,26,475. Equity shares for the year ended March 31, 2013 for your consideration. The Dividend, if approved at the ensuing Annual General Meeting, will be paid to those shareholders whose names appear on the Register of Members of the Company as on the Book Closure date.

REVIEW OF OPERATIONS AND PERFORMANCE:

Demand for Ferro Alloys is driven by steel industry, which consumes about 90 % of Ferro alloys and accordingly the Prospects for Ferro alloys industry is directly linked to the performance of steel industry and its cycles. The emerging Economies like India and China are the prime movers of the demand for steel and in turn for Ferro alloys.

Most Ferro Alloy producers in India are currently passing through a difficult situation due to maximum availability of quality power increase in power cost and declining profitability. Your company is no exception to these phenomena. In view of above the Company could achieve a production of 12424 MT of Ferro Alloys products as against 21572 MT during the previous year, a decrease of 42.40%. In order to meet the gap between demand and supply, the company has chosen to outsource Ferro Alloys from other manufacturers. The total income including sales turnover of Ferro Alloys and steel products was Rs. 22323.26 lakhs during the year under review as compared to Rs.25067.89 lakhs during previous year. Your Company has registered a Net Profit after tax of Rs.1184.21 lakhs against Rs. 1754.38 lakhs during the previous year. As the power situation is improving in the current financial year, the Company is confident of achieving a better performance.

SHIFTING OF REGISTERED OFFICE:

The Company has shifted its registered office from "Vishnu Splendour", D No.8-3-979/123456, Survey No. 41, 42, Flat No. 302, B Block, Yellareddyguda, Hyderabad - 500 073 to Plot No. 18, Street No. 1, Sagar Society, Road No. 2, Banjara Hills, Hyderabad 500 034 with effect from 07.04.2012.

DEPOSITORY SYSTEM:

The company''s shares are compulsorily tradable in electronic form. As on 31.03.2013, 83.88% of the company''s total paid-up capital representing 7, 04, 26,475 shares are in dematerialized form. In view of the numerous advantages offered by the depository system, Members holding shares in physical mode are advised to avail of the facility of dematerialization on either of the depositories.

LISTING OF SHARES ON CONVERSION:

Approval for listing of 90,00,000 equity shares of Rs. 2/- each issued to Promoters and Public on Preferential Allotment basis have been accorded by both the Bombay and National Stock Exchanges where the Company''s equity shares are listed.

DIRECTORS

Sri A.V.L. Narasimham ceased to be Director w.e.f. 12.11.2012 consequent to his resignation dated 21.09.2012.

Sri S.Venkataraman, was appointed as Director in casual vacancy consequent to the resignation of Sri A V L Narasimham w.e.f. 12.11.2012.

In accordance with provisions of Section 256 of the Companies Act, 1956 and Articles of Association of the Company, Smt Sarita Boorugu and Sri M V Bhaskara Rao, retire by rotation and being eligible, offers themselves for re-appointment.

The Board places its record of appreciation for the valuable contribution of out going Director and welcomes Sri S Venkataraman to the Board of Directors.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217[2AA] of the Companies Act, 1956 and on the basis of explanations given by the executives of the Company and also subject to the disclosures in the Annual Accounts, your Directors confirm as under:

i. That in the preparation of the annual accounts, the applicable Accounting Standards have been followed along with proper explanations relating to material departures.

ii. That the Directors had selected such accounting policies and applied them consistently and made judgments and that 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 of the Company for that period.

iii. 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 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. That the Directors had prepared the Annual Accounts for the financial year ended March 31, 2013 on going concern basis.

SOCIAL RESPONSIBILITY

As a Socially Responsible Corporate Citizen, the Company has been providing water supply to the nearby village of Ravivalasa housing 2000 families and provided 5 beds to RIMS Hospital at Srikakulam. On the development of the village infrastructure, your Company has supplied 50 loads of gravel for inner road development at Dharmaneelapuram Village and also helped on formation of irrigation canals around Dharmaneelapuram Village. In addition to that, your Company has undertaken the maintenance of BC hostels at Tekkali and Polavaram Village. To make the environment pollution free and to enhance the efficacy of arresting emission of dust in the plant, the Company has laid pipelines and installed water sprinkling system around the Plant.

FIXED DEPOSITS

During the year under review, your Company neither invited nor accepted any fixed deposits from the public.

CORPORATE GOVERNANCE

Report on Corporate Governance and Certificate of Auditors of the Company for the due Compliance of Code of Corporate Governance pursuant to Clause 49 of the Listing Agreement forms part of this Report.

PERSONNEL RELATIONS

During the year under review, relationship with the employees continued to remain cordial.

CONSERVATION OF ENERGY, TECHNICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO.

The information relating to Conservation of Energy, Technical Absorption, Foreign Exchange Earnings and Outgo pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies [Disclosure of Particulars in the Report of the Board of Directors] Rules, 1988, is forming part of this report.

AUDITORS

The Auditors, M/s. S Venkatadri & Co, Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting vide their letter dated 17.07.2013, have expressed their inability to be considered for appointment as Auditors of the Company for the financial year 2013-14.

M/s Nekkanti Srinivasu & Co., Chartered Accountants, (Membership No.209453) have expressed their willingness to be considered for appointment as Statutory Auditors.

They have confirmed that if appointed as Statutory Auditors of the Company, such appointment will be within the prescribed limits under Section 224(1B) of the Companies Act, 1956.

PARTICULARS OF EMPLOYEES

None of the employees is covered under Section 217 [2A] of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 as amended.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank the Banks, Central and State Government Authorities, Regulatory Authorities, Customers, Suppliers, Shareholders and Investors at large for their continued support to the Company and look forward to having the same support in the years to come.

Your Directors would like to express their appreciation to all the employees for their outstanding contribution to the operations of the Company during the year, under review.



On behalf of the Board of Directors

Date : August 14, 2013 PRASHANT BOORUGU

Place : Bangalore MANAGING DIRECTOR

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Mar 31, 2012

The Directors are pleased to present Sixth Annual Report together with the Audited Accounts for the year ended March 31, 2012.

FINANCIAL RESULTS (Rs. In Lakhs)

Particulars 2011-12 2010-11

Sales Income 25001.47 17398.52

Total income 25067.90 17436.53

Profit before interest and depreciation 2675.15 2525.83

Interest 635.39 297.26

Depreciation 260.69 224.80

Profit before tax 1779.07 2003.77

Provision for -

- Current Tax - 728.44

- Deferred Tax 24.68 (63.86)

Profit after tax 1754.39 1,339.19

Balance brought forward from previous year 1577.28 389.92

Balance available for appropriations 3331.67 1,729.11

Preference Dividend 69.21 69.21

Proposed Dividend on Equity 61.43 61.43

Corporate Dividend Tax - Preference 11.23 11.23

Corporate Dividend Tax - Equity 9.96 9.96

Balance carried forward to Balance Sheet 3179.84 1,577.28

DIVIDEND

Your Directors are pleased to recommend a dividend of 5% on equity share of Rs.2/- each on 6,14,26,475 shares for the year ended March 31, 2012. The dividend, if approved at the ensuing Annual General Meeting, will be paid to those shareholders whose names appear on the Register of Members of the Company as on the Book Closure date.

REVIEW OF OPERATIONS AND PERFORMANCE

In the year, under review, the Company has achieved a production of 21572 MT of Ferro Alloys products as against 28057 MT during previous year, decrease of 23.11% due to constraints in supply of Chrome Ore and Power. Therefore, the Company has chosen outsourcing of the products so as to meet the growing demand from the customers. With this strategy, the Sale turnover of Ferro Alloys products increased to Rs.251 Crores as compared to Rs.174 Crores during previous year, registering a growth of 43.76%. The Company has registered a Profit after tax of Rs.1754.39 lakhs against Rs.1339.19 lakhs of previous year.

SUB DIVISION OF EQUITY SHARES

Your Company's equity shares of Rs.10/- each has been sub-divided into Rs.2/- each w.e.f 04.11.2011.

CHANGE OF NAME

Your Company's name has been changed from 'Cronimet Alloys India Limited' to "METKORE ALLOYS & INDUSTRIES LIMITED" w.e.f 11.01.2012.

SHIFTING OF REGISTERED OFFICE

Effective from 07.04.2012, the Registered Office of the Company has been shifted from 'Vishnu Splendor', D No. 8-3-979/123456, Survey No. 41, 42, Flat No. 302, 'B' Block, Yellareddyguda, Hyderabad - 500 073 to Plot No.18, Sagar Society, Street No.1, Road No.2, Banjara Hills, Hyderabad - 500 034.

Directors

In accordance with provisions of the Companies Act, 1956 and Articles of Association of the Company, Sri K Mallikarjuna Rao and Sri AVL Narasimham, retire by rotation and being eligible, offers themselves for re-appointment.

Directors Responsibility Statement

Pursuant to Section 217[2AA] of the Companies Act, 1956 and on the basis of explanation given by the Executives of the Company and also subject to the disclosures in the Annual Accounts, your Directors confirm as under:

i. That in the preparation of the annual accounts, the applicable Accounting Standards have been followed along with proper explanations relating to material departures.

ii. That the Directors had selected such accounting policies and applied them consistently and made judgments and that 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 of the Company for that period.

iii. 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 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. That the Directors had prepared the annual accounts for the financial year ended March 31, 2012 on a going concern basis.

Social Responsibility

Your Company actively supports the corporate social responsibility in the field of education, health, hygiene & sanitation, empowerment, safety and community development programmes in the areas surrounding the Company's project site. Your Company continues to make significant contribution to promote sustainable livelihoods of people living in and around its factory zones by providing educational support, technical assistance, financial assistance, organizing medical camps etc.,

Your Company also provides hygiene drinking water to nearby villages covering 2000 houses and facilitates medical aid in times of emergency including supply of beds to the hospital and recognizes protection and management of environment and development of inter road as well formation of the irrigation cannels as one of its highest priorities and every effort is made to conserve and protect environment.

The Company continues to focus on maintenance and performance improvement of related pollution control facilities like effluent treatment plant and waste disposal facility at its manufacturing locations.

Fixed Deposits

During the year under review, your Company neither invited nor accepted any fixed deposits from the public.

Corporate Governance

Report on Corporate Governance and Certificate of Auditors of the Company for the due compliance of code of Corporate Governance pursuant to Clause 49 of the Listing Agreement is form part of this Report.

Conservation of Energy, Technical Absorption, Foreign Exchange Earnings and outgo.

The information relating to Conservation of Energy, Technical Absorption, Foreign Exchange earnings and outgo pursuant to Section 217(1)(e) Companies Act, 1956 read with Companies [Disclosure of Particulars in the Report of the Board of Directors] Rules, 1988, is forming part of this report.

Auditors

The Auditors, M/s. Venkatadri & Co., Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. They have confirmed their willingness to act as Auditors of the Company for the financial year 2012- 13 and confirmed that their re-appointment, if made, would be within prescribed limits under Section 224 (1B) of the Companies Act, 1956.

Particulars of Employees

None of the employee is covered under Section 217 [2A] of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 as amended.

Acknowledgement

Your Directors take this opportunity to thank the State & Central Government authorities, Banks, Regulatory Authorities, Customers, Suppliers, Shareholders and Investors at large for their continued support to the Company and look forward to having the same support in the years to come.

Your Directors would like to express their appreciation to all the employees for their outstanding contribution to the operation of the Company during the year, under review.

On behalf of the Board of Directors

Bangalore Prashant Boorugu S. Gajendran

August 14, 2012 Managing Director Director

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Mar 31, 2010

The Directors are pleased to present their Fourth Annual Report of the Company together with the Audited Accounts for the year ended March 31, 2010.

FINANCIAL RESULTS

(Rs. In Lakhs)

2009-10 2008-09

Sales Income 11,475.39 10,080.36

Total Income 11,522.79 10,101.64

Profit before interest and depreciation 1186.02 (85.49)

Interest 39.73 159.96

Depreciation 229.09 227.22

Profit before Tax 917.20 (472.13)

Provision for -

Current Tax 251.39 -

- Deferred Tax 72.35 (157.57)

Fringe Benefit Tax - 0.43

Profit after Tax 593.46 (314.99)

Balance brought forward from previous year (42.14) 272.85

Balance available for appropriations 551.32 (42.14)

Preference Dividend 138.42 -

Income-tax on Preference Dividend 22.99 -

Balance carried forward to Balance Sheet 389.91 (42.14)



REVIEW OF OPERATIONS AND PERFORMANCE

Your Directors are pleased to inform that the Company has put up a steliar performance with a record production of 20,847.91 MT of Ferro Alloys products as against 17,216.18 MT in the previous year, an increase of 21.09% and this exemplary performance was accomplished inspite of the remnants of global meltdown lingering on in the economy for part of the year and shut down of one of the furnaces for four months for relining. Sales of Ferro Alloys have touched 23,751.54 MT during the year as against 15,555.43 MT in the previous year, an increase of 52.69%. The turnover for the year has increased to Rs 11522.79 lakh registering a growth of 14% over 2008-09. Your Company is back on a healthy sign by registering a Net Profit of Rs.593.46 lakh against a loss of Rs.314.99 lakhs in the previous year.

DIVIDEND

Your Directors recommend Dividend of 8% on Preference Shares. .

Keeping in view the need to conserve resources to plough back the same in the business for further expansions, your Directors do not recommend any dividend for the year on equity shares.

SHIFTING OF REGISTERED OFFICE

Effective from 30.11.2009, the Registered Office of the Company has been shifted from No. 6-3-866/1/G2, Greenlands, Begumpet, Hyderabad - 500 016 to Ravivalasa Village - 532 212 Tekkali Manda!, Srikakulam District, Andhra Pradesh.

MANAGEMENT DISCUSSION AND ANALYSIS

Industry Siructure and Development:

The High Carbon Ferro Ciirome (HCFC) is one of the major ingredients in the manufacture of stainless steel. The consumption of HCFC is directly proportional to the consumption of stainless steel. Hence the demand and supply of HCFC is decided based on the prospects of stainless steel industry. The global stainiess steel market which is estimated at 20 million tones, is expected to grow at a steady pace of 10% p.a However, the onset of Global economic meltdown from mid 2008 has seen the demand for stainiess steel plummetted by around 7% with its consequential impact on the demand and prices of HCFC . The second half of the year 2009-10 witnessed signs of recovery with the prices of HCFC on the ascending mode.

FUTURE OUTLOOK:

After a sluggish three years period, the Company expects the demand for HCFC to grow at steady pace in line with the demand for stainless steel. As stainiess steei is linked to life style development across globally, the consumption is expected to constantly rise. The consumption of stainless steel in China has gone up by 25%. Though there is an intermittent fluctuations in the HCFC prices, it is expected to stabilize as

the gloomy atmosphere surrounding the global economy is over. As the global demand for stainless steel is expected to touch 25- 28 million tones by 2012, it will throw open vast opportunities for HCFC manufacturers.

OPPORTUNITIES AND THREATS

Domestic demand for Ferro Chrome stood at about 0.54 Million MT during the year 2009-10. A continuous demand for stainless steel in the international market will throw significant opportunities to this business. However, expansion of projects by existing players who are having both mines, power plants and established in other regions of the country may lead to negative impact. The procurement of raw material and the existing monopolistic pricing is always considered a threat to this industry in addition to frequent changes in power tariff.

EXPORT AND IMPORTS

During the year under review, your Company made exports worth Rs.3618.29 lakhs and not had made any direct imports.

INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY

The Company has put in place a well developed internal control system and an internal Audit system commensurate with its size and activities. The periodical reports are securitized by the management and placed before the Audit Committee along with its reply. The weaknesses pointed out in the reports have been rectified and the suggestions for improvement were implemented in letter and spirit.

HUMAN RESOURCE DEVELOPMENT

Your Company has given a high degree of importance in developing the human capital and its continual improvement. The Management focuses on safe work practices and procedures at all times.

Initiatives such as rewards for suggestions, quality circles etc., have been taken up to involve the employees and take innovative ideas to solve day to day work related problems.

Industrial relations with the Union and the employees were good and harmonious. Your Company has implemented all employee welfare schemes as per the Company policy and wage agreement. As on March 31, 2010, the number of employees on the rolls of the Company stood at 231.

CAUTIONARY STATEMENT

The Management discussion and analysis report containing your companys objectives, projections, estimates and expectation may constitute certain statement, which are forward looking within the meaning of applicable laws and regulations. Your companys operation may inter alia be affected by the supply and demand situations, input pil^c -^d the availability, changes in the government regulations, tax laws and other factors.

DIRECTORS

Mr B V N Rao, Mr N V Varadarajulu, Mr N C Sarabeswaran, Mr U Nareshkumar and Mr Prem Kumar Amar have tendered their resignation w.e.f. 17.12.2009 and ceased to be Directors.

Pursuant to Section 262 of the Companies Act, 1956 and Article No. 111 of the Articles of Association, Mr Rajiv Saxena, Mr Harjith D. Bubber, S. Gajendran, Mr Prashant Boorugu and Mr K Mallikarjuna Rao were appointed as Directors w.e.f. 17.12.2009 in the casual vacancies caused by the aforesaid resignations. Mr. Rajiv Saxena, Mr. S. Gajendran and Mr. K. Mallikarjuna Rao hold office upto September 24, 2011 and Mr. Harjit D. Bubber holds office upto September 28, 2012. However, it is proposed to appoint Mr. Rajiv Saxena, Mr. Harjit D. Bubber, Mr. S. Gajendran, and Mr. K. Mallikarjuna Rao as Directors at the ensuing Annual General Meeting. Notices have been received from a member, pursuant to Section 257 of the Companies Act, 1956, together with the prescribed deposit, proposing the appointments of Mr. Rajiv Saxena, Mr. Harjit D. Bubber, Mr. S. Gajendran, and Mr. K. Mallikarjuna Rao as Directors.

Mr Prashant Boorugu, Managing Director ceased to be Director and Managing Director of the Company with effect from 25.02.2010 consequent to his resignation.

In terms of Section 260 of the Companies Act, 1956, Mr A V L Narasimham and Mrs Sarita Boorugu were appointed as Additional Directors on the Board with effect from 25.02.2010 and 10.08.2010 respectively. They hold office until the date of the ensuing Annual General Meeting. Notices have been received from a member, pursuant to Section 257 of the Companies Act, 1956, together with the prescribed deposit, proposing the appointments of Mr. A.V. L. Narasimham and Mrs. Sarita Boorugu as Directors at the ensuing annual general meeting.

Suitable resolutions are being separately proposed for their appointments as Directors of the Company.

As the Board consists of Directors in casual vacancy and Additional Directors, there is no director who is liable to retire by rotation under Section 256(1) of the Companies Act, 1956 and consequently, no subject relating to appointment of Directors in place of those retiring is placed in the ordinary business of the notice of the ensuing Annual General Meeting

Your Board of Directors place on record, its appreciation of the services of all the outgoing Directors.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217[2AA] of the Companies Act, 1956 and on the basis of explanation given by the Executives of the Company and also subject to the disclosures in the Annual Accounts, your Directors confirm as under:

i. That in the preparation of the annual accounts, the applicable Accounting Standards have been followed along with proper explanations relating to material departures.

ii. That the Directors had selected such accounting policies and applied them consistently and made judgments and that 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 of the Company for that period.

iii. 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 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. That the Directors had prepared the annual accounts for the financial year ended March 31, 2010 on a going concern basis.

SOCIAL RESPONSIBILITY

Your Company actively supports the corporate social responsibility in the field of education, health, hygiene & sanitation, empowerment and community development programmes in the areas surrounding the companys project site. Your Company continues to make significant contribution to promote sustainable livelihoods of people living in and around its factory zones by providing educational support, technical assistance, financial assistance, organizing medical camps, etc., Your Company also provides hygiene drinking water to nearby village and facilitates, medical aid in times of emergency.

FIXED DEPOSITS

During the year under review, your Company neither invited nor accepted any fixed deposits from the public.

CORPORATE GOVERNANCE

Report on Corporate Governance and Certificate of Auditors of the Company for the due compliance of code of Corporate Governance pursuant to Clause 49 of the Listing Agreement are attached and form part of this Report.

PERSONNEL RELATIONS

During the year under review, relationship with the employees continued to remain cordial.

CONSERVATION OF ENERGY, TECHNICAL ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO.,

The information relating to Conservation of Energy, Technical Absorption, Foreign Exchange earnings and outgo pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies [Disclosure of Particulars in the Report of the Board of Directors] Rules, 1988, is given in the Annexure forming part of this report.

AUDITORS

The Auditors, M/s. Venkatadri & Co, Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. They have confirmed their willingness to act as Auditors of the Company for the financial year 2010- 11 and confirmed that their re-appointment, if made, would be within prescribed limits under Section 224 (1B) of the Companies Act, 1956.

PARTICULARS OF EMPLOYEES

The Information required under Section 217 [2A] of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, is given in Annexure forming part of this report.

ACKNOWLEDGEMENT

Your Directors acknowledge and express their grateful appreciation for the co-operation and assistance received from Banks, Government Authorities, Customers and Suppliers.

Your Directors wish to place on record their appreciation for the total commitment shown by each and every employee of the Company.

Your Directors also thank the shareholders for the confidence reposed by them in the management of the Company and for their continued support and co-operation.

On behalf of the Board of Directors

Bangalore S Gajendran

August 10, 2010 Chairman of the Meeting