To the Members,
Your Directors have pleasure in presenting the 24th Annual Report on the business &
operations of the Company together with the Standalone and Consolidated Audited Financial
Statement for the year ended 31st March 2023.
1. FINANCIAL HIGHLIGHTS:
Rs In Crores
Particulars |
Standalone |
Consolidated |
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Gross Revenue from operations |
5284.72 |
5074.60 |
5753.04 |
5399.18 |
Other Income |
96.24 |
18.34 |
104.06 |
29.37 |
Total Revenue |
5380.96 |
5092.94 |
5857.10 |
5428.55 |
Operating expenses |
4173.21 |
3293.62 |
4620.34 |
3535.01 |
Profit before Interest, Depreciation, Tax and Amortization (EBIDTA) |
1207.75 |
1799.32 |
1236.76 |
1893.54 |
Finance Costs |
15.21 |
17.35 |
20.40 |
19.69 |
Depreciation and amortization expenses |
117.00 |
101.75 |
123.53 |
104.7 |
Profit/(loss) before exceptional item and tax |
1075.54 |
1680.22 |
1092.83 |
1769.15 |
Add: Share of Profit/(Loss) of Associates & Joint Ventures net of
tax |
0.00 |
0.00 |
4.47 |
65.17 |
Exceptional item |
2.08 |
98.74 |
-14.72 |
98.74 |
Profit/(Loss) Before Taxation |
1077.62 |
1778.97 |
1082.58 |
1933.07 |
Taxation (including Deferred Tax) |
294.40 |
428.00 |
289.22 |
451.15 |
Profit/(Loss) after Taxation (PAT) |
798.22 |
1350.96 |
793.36 |
1481.92 |
2. REVIEW OF PERFORMANCE:
Your Company's performance during the year under review was satisfactory and the
Company has reported operating margins of 22.44% on standalone operations and margin of
21.12% on consolidated operations, although lower last year, but in line with long term
average margins. The operating margin in FY22 was considerably higher on account global
supply chain disruption and substantially higher iron ore & finished steel prices
across value chain. The realization for iron ore pellet was also higher in FY22 at RS.
13881 ton, which fell to RS. 10355 ton on account of imposition of export duty on iron ore
pellets and other steels products for part of the year, which alongwith increase in the
input cost of coal and other operational costs, resulted into lower profitability during
the year under review. The realizations of all the products have also decreased as
compared to previous year which in turn adversely affected the operating margins/EBIDTA of
the Company. As communicated in our last reports, the Company's efforts for making high
grade pellets has been successful and also contributed to the profitability of the
Company. Given the above backdrop, the highlight of standalone & consolidated results
are given below:
Standalone Operations:
Revenue from operations for the year increased by 4% to RS. 5284.72 Crores as
compared to RS. 5074.60 Crores achieved during previous Financial Year on account of
higher sale of pellet volume and other value added products.
EBITDA for the year decreased by 33% to RS. 1207.75 Crores as compared to EBITDA
of RS. 1799.32 Crores achieved in previous Financial Year.
Profit after tax decreased by 41% to RS. 798.22 Crores (excluding profit from
sale of investments) as compared to net profit of RS. 1350.96 Crores in previous Financial
Year.
Consolidated Operations:
Revenue from operations for the year marginally increased by 6.55% to RS.
5753.04 Crores as compared to RS. 5399.18 Crores during the previous Financial Year;
EBITDA for the year decreased by 34.68% to RS. 1236.76 Crores as compared to
EBITDA of RS. 1893.54 Crores achieved during previous Financial Year.
Profit after tax during the year decreased by 46.46% to RS. 793.36 Crores as
compared to net profit after tax of RS. 1481.92 Crores during previous Financial Year.
The detailed comments on the operating and financial performance of the Company, during
year under review have been given in the Management Discussions & Analysis.
3. DIVIDEND AND DIVIDEND DISTRIBUTION POLICY:
The Board of Directors of your Company has recommended final dividend of RS. 4.00 per
Shares (Previous Year RS. 8.50 per share) of RS. 5/- each on the paid up capital of the
Company for the financial year 2022-23. The outflow of funds on account of final dividend
shall be RS. 54.38 crores (previous year RS. 119.80 crores). The final dividend for the
financial year 2022-23, if approved, by the shareholders of the company in the ensuing
Annual General Meeting, the same will be paid in due course as per the applicable
provisions. In addition to the proposed final dividend of RS. 4/- per share, the Company
has recently concluded buyback of 50,00,000 equity shares of RS. 5/- each fully paid at a
price of RS. 500/- per share amounting to RS. 250 Crores. Together with the buyback
consideration, the total distribution of funds to the shareholders of the Company amounted
to RS. 305 Crores (including buyback tax payments), which was 38.21% of the net profit of
the Company. (Previous year RS. 137.42 Crores i.e. 10.17% including interim dividend).
Dividend Distribution Policy In terms of Regulation 43A of the Securities and Exchange
Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ('SEBI
Listing Regulations') the Board of Directors of the Company (the 'Board') formulated and
adopted the Dividend Distribution Policy (the 'Policy'). The Policy is available on our
website at https://www. godawaripowerispat.com/wp-content/uploads/2022/02/
Dividend-Distribution-Policy.pdf
4. SHARE CAPITAL:
As on 31st March, 2023, the paid up Equity Share Capital of the company was RS. 70.47
Crores divided into 14,09,44,988 Equity Shares of RS. 5 each/-.
During the year under review, the Company has not issued any shares with differential
voting rights nor granted stock options nor sweat equity. As on 31st March 2023, the
company has not issued any convertible instruments and none of the Directors of the
Company hold convertible instruments of the Company.
The equity shares of the company representing 99.99% of the share capital are
dematerialized as on 31st March, 2023.The dematerialization facility is available to all
shareholders of the company from both the depositories namely National Securities
Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The
Depositories has allotted ISIN: INE177RS. 01021 due to sub division of Equity shares of
the Company for dematerialization of shares of the company.
5. BUYBACK OF SHARES:
The Board of Directors in its meeting held on 18.03.2023 approved the proposal for
buyback of up to 50,00,000
(Fifty Lakhs) fully paid up equity shares of the Company, having a face value of RS. 5
(Rupees Five Only) each representing 3.66% of the total number of equity shares in the
existing paid-up equity capital of the Company (excluding 45,00,00 shares held by GPIL
Beneficiary Trust), at a price of RS. 500/- (Rupees Five Hundred Only) per fully paid up
Equity Share payable in cash for an aggregate maximum amount not exceeding RS. 250.00
Crores (Rupees Two Fifty Crores Only), represents 8.14% and 7.67% of the aggregate of the
total paid-up equity share capital and free reserves of the Company based on the audited
standalone and consolidated financial statements of the Company as at March 31, 2022,
respectively, through the "Tender Offer" route as prescribed under the SEBI
Buyback Regulations. The entire process of the Buyback of equity shares has been completed
and the payment of buyback consideration was made on April 24, 2023 and the 50,00,000
equity shares were extinguished on April 28, 2023. The total outflow of funds on account
of buyback amounted to RS. 305 Crores including buyback tax paid by the Company).
The Buyback consideration price of RS. 500/- per share represents:
(i) Premium of 32.31% and 32.69% over the volume weighted average market price of the
Equity Shares on NSE and BSE, respectively, during the three months preceding Wednesday,
March 15, 2023, being the date of intimation to the Stock Exchanges for the Board Meeting
to consider the proposal of the Buyback ("Intimation Date").
(ii) Premium of 36.00% and 36.16% over the volume weighted average market price of the
Equity Shares on NSE and BSE, respectively, for two weeks preceding the Intimation Date.
(iii) Premium of 39.10% and 39.12% over the closing price of the Equity Shares on NSE
and BSE, respectively, as on Tuesday, March 14, 2023, being the day preceding the
Intimation Date.
(iv) Premium of 33.87% and 33.82% over the closing price of the Equity Shares on NSE
and BSE, respectively, as on Wednesday, March 15, 2023, being the day of Intimation Date.
(v) Premium of 29.10% and 28.77% over the closing price of the Equity Shares on NSE and
BSE, respectively, as on 1 (one) day prior to the Board Meeting i.e., Friday, March 17,
2023, as there was a trading holiday on the day of the Board Meeting for Buyback.
Upon conclusion of the Buyback the paid up share capital of the company decreased from
RS. 70.47 Crores divided into 14,09,44,988 Equity Shares of RS. 5 each/- to RS. 67.97
Crores divided into 13,59,44,988 Equity Shares of RS. 5 each/-.
6. EXPANSION/NEW PROJECTS:
The proposed 70 MWp Captive Solar PV Power plant of the Company at Rajnandgaon,
Chhattisgarh has been commissioned and duly synchronized with the grid and commenced on
08th August, 2022. The power generated at Solar Power Plant is being captively consumed to
meet partially the enhanced power requirement for Integrated Steel Plant and partially to
replace the high cost grid power. The generation of Solar energy also supports the green
initiatives of the Company and reduce the carbon foot print in the economy.
The Company is setting up another 30 MW Solar Power Plant for which the Company has
acquired land and all the modules and other equipments have been received at site.
Construction work has started and the same is expected in Q2FY2024.
The Company has purchased 25MW thermal Power Plant from Jagadamba Power and Alloys
Limited (JPAL) on Slump Sale Basis in the month of June, 2022, to meet the captive power
requirement of the Company.
In addition to the above, the Company is undertaking investment in capital expenditure
for debottlenecking in power division by replacement of old turbines into new latest
technology and high efficiency power generating turbine, which would result into
additional generation of electric power by 8MW without any additional fuel & operating
cost.
The Company is also undertaking debottlenecking in the Iron & Steel making
facilities in various plants, as detailed below, which are also expected to be completed
during the current year.
Particulars |
Capacity |
CAPEX in Rs Crores |
|
FY22 |
FY23 |
Total |
Already incurred upto 31.03.2023 |
Balance to be incurred |
Iron Ore Mining, Crushing and Beneficiation facilities |
2.10 MTPA |
3.05 MTPA |
85.00 |
83.90 |
1.10 |
Steels Billets |
0.40 MTPA |
0.50 MTPA |
41.00 |
36.40 |
4.60 |
Rolling Mill Modification (RR Ispat Unit) |
0.214 MTPA |
0.216 MTPA |
70.00 |
7.40 |
62.60 |
Replacement of Turbines in Power Plant |
73 MW |
73 MW |
86.00 |
46.30 |
39.70 |
Your Company has also announced increase in Iron Ore mining capacity at Ari Dongri
Mines from 2.35 million tons to 6 million tons with additional iron ore crushing &
beneficiation plant at Ari dongri mines and also for setting up of an additional 3 million
tons pellet capacity at existing plant location at Raipur at an aggregate investment of
RS. 1000 crores. The Company has initiated the process for environmental approval for
enhancement in mining capacity and pellet plant and the same is expected to be received
during the current year. The construction activities shall start post receipt of
environmental approval.
Your Company has also initiated process for green field steel plant with a capacity of
1.00 million in Raipur District of Chhattisgarh and have applied for land acquisition and
environmental approval. The Company has already received letter of allotment for land
acquisition and process for transfer of land to the Company is going on. Similarly, the
Company has applied for the environment approval for the project and approval is awaited.
7. ANNUAL RETURN:
In accordance with the Companies Act, 2013, the annual return in the prescribed format
is available at https://www. godawaripowerispat.com/performance/shareholders/
annual-return/
8. NUMBER OF MEETINGS OF BOARD:
During the period under review, Eight Board Meetings were convened and held, the
details of which are given in the Corporate Governance Report.
9. DIRECTORS' RESPONSIBILITY STATEMENT:
Your Directors make the following statements in terms of Section 134(3) (c) of the
Companies Act, 2013 based on the representations received from the operating management
and Chief Financial Officer of the Company:
a. That in the preparation of the annual accounts, the applicable accounting standards
have been followed along with proper explanation relating to material departures;
b. That your Directors have selected such accounting policies and applied them
consistently, and made judgment 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 your Directors have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of this Act for safeguarding
the assets of your Company and for preventing and detecting fraud and other
irregularities;
d. That your Directors have prepared the annual accounts on a going concern basis.
e. That your Directors have laid down proper internal financial controls to be followed
by the Company and that such financial controls are adequate and were operating
effectively; and
f. That your Directors have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively.
10. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTOR:
All Independent Directors of the Company have given declarations as required under the
provisions of Section 149 (7) of the Companies Act, 2013 stating that they meet the
eligibility criteria of independence as laid down under section 149(6) of the Companies
Act, 2013 and Regulation 25 of Securities and Exchange Board of India (Listing Obligations
and Disclosure Requirements) Regulations, 2015.
11. SEPERATE MEETING OF INDEPENDENT DIRECTORS:
During the year under review, the Independent Directors held their separate meeting on
06th May, 2023 inter alia, to discuss:
Review the performance of Independent Directors.
Review the performance of the Non-Independent Directors.
Review the performance of the committees and Board as a whole.
Review the performance of the Chairman of the Company, taking into account the
views of Executive Directors and Non Executive Directors.
Assess the quality, quantity and timeliness of flow of information between the
Company management and the Board that is necessary for the Board to effectively and
reasonably perform their duties
12. NOMINATION AND REMUNERATION COMMIITEE AND ITS POLICY:
Company's Policy on Directors Appointment and Remuneration including criteria for
determining qualification, positive attributes, independence of directors and other
matters provided under section 178(3) of the Companies Act, 2013 is also placed at the
website of the Company at www.godawaripowerispat. com.
Subsequent to resignation of Mr. Bhrigu Nath Ojha from Directorship of the Company, the
Nomination and Remuneration committee has been reconstituted by the Board of directors in
its meeting held on 29.07.2022, by inducting Mr. Raj Kamal Bindal, Independent
NonExecutive Director, as member of the Nomination and Remuneration Committee. to comply
with the provisions of Regulation 19(1) of SEBI (Listing Obligations And Disclosure
Requirements) Regulations, 2015. Consequent upon resignation of Mr Bhrigu Nath Ojha, Mr.
Shashi Kumar was designated as Chairman of the Committee w.e.f. 29.07.2022 and
subsequently Miss Bhavna Govindbhai Desai, was designated as Chairperson with effect from
10.11.2022 in place of Mr Shashi Kumar.
Presently it consists of following three Independent Directors:
S. No. |
NAME |
DESIGNATION |
1. |
Ms. Bhavna Govindbhai Desai |
Chairperson and Member - Independent - Non Executive Director |
2. |
Shri Shashi Kumar |
Member- Independent - Non Executive Director |
3. |
Mr. Raj Kamal Bindal* |
Member- Independent - Non Executive Director |
*Inducted as Member with effect from 29.07.2022.
More details are given in the Corporate Governance Report.
13. AUDITORS:
Statutory Auditors
Pursuant to the provisions of Section 139 of the Act and the rules framed thereafter,
M/s JDS and Co., Chartered Accountants, were appointed as Statutory Auditors of the
Company for a second term of five consecutive Financial Years by the shareholders in their
Annual General Meeting held on 16.09.2022 to hold office from the conclusion of Annual
General Meeting till the conclusion of the Annual General Meeting of the Company to be
held in the year 2027.
Consequent upon merger of M/s JDS and Co., Chartered Accountants with Singhi & Co.,
the audit committee and Board in their respective meetings held on 09.12.2022 have
approved the proposal for change of name of statutory auditor's firm of the company from
M/s JDS & Co. (FRN: 018400C) to M/s. Singhi & Co (FRN: 302049E) which has been
duly approved by the shareholders of the company in their Extra Ordinary General Meeting
held on 21.01.2023 for the change of name of statutory auditor's firm of the company from
M/s JDS & Co. (FRN: 018400C) to M/s. Singhi & Co (FRN: 302049E) for a period of
five years from the financial year 2022-23 to financial year 2026-27 i.e. till conclusion
of the Annual General Meeting to be held in the year 2027 after obtaining a certificate
from M/s. Singhi & Co. to the effect that if their appointment is made, the same would
be within the limits prescribed under Section 141 (3) (g) of the Companies Act, 2013 and
that they are not disqualified for re-appointment and also satisfies the criteria as
mentioned under Section 141 and they have obtained peer review certificate as required
under SEBI Guidelines for appointment of Statutory Auditors of listed companies.
Cost Auditors
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the
Companies (Cost Record and Audit) Amendment Rules 2014 M/s Sanat Joshi & Associates
has been appointed as cost auditors for conducting Cost Audit for the Financial Year under
review.
Internal Auditors
Pursuant to the provisions of Section 138 of the Companies Act, 2013 M/s. OPS & Co,
Chartered Accountants were appointed as Internal Auditors for the Financial Year under
review.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has
appointed CS Tanveer Kaur Tuteja, Practising Company Secretary, (FCS 7704, CP 8512) to
undertake the Secretarial Audit of the Company.
14. AUDITOR'S REPORTS:
Statutory Auditors
There are no qualifications, reservations, adverse remarks or disclaimers in the
Statutory Auditor's Report on the financial statements of the Company for the Financial
Year 2022-23 and hence does not require any explanations or comments by the Board.
Frauds reported by the Auditors:
No frauds have been reported by the Statutory Auditors during the Financial Year
2022-23.
Secretarial Audit
The Secretarial Audit Report received from the Secretarial Auditor of the Company for
the Financial Year 2022-23 is annexed herewith as ANNEXURE 01.
The Company's subsidiary company namely Hira Ferro Alloys Limited (HFAL) being the
material subsidiary of the Company, in accordance with Regulation 24A of Securities
Exchange Board of India (Listing Obligations and Disclosure Requirements) 2015 has also
obtained Secretarial Audit Report which is annexed herewith as ANNEXURE 02.
There are no qualifications, reservations, adverse remarks or disclaimers in the
Secretarial Auditor's Report on secretarial and other applicable legal compliances to be
made by the Company for the Financial Year 2022-23 and hence does not require any
explanations or comments by the Board.
15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
The particulars of investments made and loans given by the Company as covered under the
provisions of Section 186 of the Companies Act, 2013 are given in Standalone Financial
Statements (Ref. Notes 6, 7 and 8). Your Company has also extended its corporate guarantee
for securing credit facilities granted to its subsidiary company namely Hira Ferro Alloys
Limited the details of which are given in Standalone Financial Statements (Ref. Note 32).
16. TRANSFER TO RESERVES:
Your Company has not transferred any amount to the General Reserves Account during the
Financial Year 2022-23.
17. TRANSFER OF UNPAID & UNCLAIMED DIVIDEND & SHARES TO INVESTOR EDUCATION AND
PROTECTION FUND:
Pursuant to the provisions of Section 125 of the Companies Act, 2013, the outstanding
amount of dividend which remained unpaid or unclaimed for a period of seven years and
shares whose dividend was unpaid/unclaimed for seven consecutive years have been
transferred by the Company, from time to time on due dates, to the Investor Education and
Protection Fund.
During the year under review, the Company has credited RS. 75,709/- to the Investor
Education and Protection Fund (IEPF) pursuant to Section 125 of the Companies Act, 2013/
Section 205C of the Companies Act, 1956 read with the Investor Education and Protection
Fund (Awareness and Protection of Investors) Rules, 2001 relating to the Dividend paid by
the Company for FY 2014-15.
During the year under review, the Company has also transferred 2092 Equity Shares to
the Investor Education and Protection Fund (IEPF) relating to 24 shareholders of the
Company, whose dividends were unclaimed/ unpaid for seven consecutive years, pursuant to
Section 125 of the Companies Act, 2013 read with the Investor Education and Protection
Fund (Awareness and Protection of Investors) Rules, 2001 and the Investor Education and
Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 relating to
Final Dividend paid by the Company for FY 2014-15.
Pursuant to the provisions of Investor Education and Protection Fund (Uploading of
information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the
Company has uploaded the details of unpaid and unclaimed amounts lying with the Company,
as on 16th September 2022 (date of last Annual General Meeting) on the Company's website
(www. godawaripowerispat.com at Investors Information - Unclaimed Dividend) and on the
website of the Ministry of Corporate Affairs.
Any person, whose unclaimed or unpaid amount has been transferred by the Company to
IEPF may claim their refunds to the IEPF authority. For claiming such amount, claimant
needs to file form IEPF-5 along with requisite documents. The detailed procedure for
claiming shares and Dividend Amount has been uploaded on the Website of the Company
(www.godawaripowerispat.com at Investors Information - Unclaimed Dividend) and also
available on the website of IEPF (www.iepf.gov.in).
The Nodal Officer for the purpose of IEPF is Company Secretary and the website address
is www. godawaripowerispat.com.
18. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION:
There are no materials changes and commitments affecting the financial position of the
Company occurred between the 01st April, 2023 and date of this report.
19. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information on conservation of energy, technology absorption and foreign exchange
earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read
with Rule 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as ANNEXURE 03.
20. AUDIT COMMITTEE COMPOSITION:
The Audit Committee was reconstituted pursuant to resignation of Mr. Bhrigu Nath Ojha
and Mr. Hari Shankar Khandelwal from the Directorship and Chairmanship/ Membership and
appointment of Mr. Raj Kamal Bindal and Mr. Samir Agarwal w.e.f 29.07.2022. Presently it
consists of following four Independent Directors all having financial literacy.
S. No. |
NAME |
DESIGNATION |
1. |
Mr. Shashi Kumar |
Chairman (Independent NonExecutive Director) |
2. |
Mr. Raj Kamal Bindal* |
Member (Independent NonExecutive Director) |
3. |
Mr. Samir Agarwal * |
Member (Independent NonExecutive Director) |
4. |
Ms. Bhavna Govindbhai Desai |
Member (Independent NonExecutive Director) |
*Inducted as Members with effect from 29.07.2022.
More details are given in the Corporate Governance Report.
21. RISK MANAGEMENT COMMITTEE:
The Risk Management Committee was re-constituted with effect from 29.07.2022 consequent
upon resignation of Mr. B.L. Agrawal, Mr. Abhishek Agrawal and Mr. Sanjay Bothra from the
Membership of the committee and by inducting Mr. Vinod Pillai as Member. Presently it
consists of One Independent Director, One NonExecutive Director and One officer of the
company.
More details are given in the Corporate Governance Report.
The risk management issues are discussed in detail in the report of Management
Discussion and Analysis.
22. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:
The Company has adopted a Risk Management Policy to identify and evaluate business
risks associated with the operations and other activities of the Company and formulated
risk mitigations strategies.
23. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:
The Company has constituted a CSR Committee of the Board ("CSR Committee")
pursuant to resolution of the Board dated 15.03.2014.
The Board of Directors at its meeting held on 15.03.2014 approved the powers, role and
terms of reference of the CSR Committee in accordance with the provisions of Section 135
of the Companies Act, 2013, and the Board in its meeting held on 31.01.2022 have approved
the revised policy framed as per amendments inserted by the Companies (Amendment) Act,
2019, Companies (Amendment) Act, 2020 and Companies (Corporate Social Responsibility
Policy) Amendment Rules, 2021 and the same has been disclosed on the website of the
Company at http://godawaripowerispat.com/wp-content/ uploads/2022/02/CSR-Policy.pdf.
The CSR Committee consists of One Independent Director, One Executive Director and One
Non-Executive Director. The detailed composition of the members of the CSR Committee at
present is given below:
S. No. |
NAME |
DESIGNATION |
1. |
Mr. Shashi Kumar |
Chairman (Independent Non-Executive Director) |
2. |
Mr. Abhishek Agrawal |
Member (Executive Director) |
3.. |
Mr. Vinod Pillai |
Member (Non-Executive Director) |
The committee met twice during the year 2022-23 and the attendance of the members at
these meetings is as follows:
Name of the Chairman/ Member and Date of Meeting |
28.05.2022 |
09.11.2022 |
Mr. Shashi Kumar |
Present |
Present |
Mr. Abhishek Agrawal |
Absent |
Present |
Mr. Vinod Pillai |
Present |
Present |
CSR Committee's Responsibility Statement:
CSR Committees hereby states that the implementation and monitoring of CSR activities,
is in compliance with CSR objectives and Policy of the Company.
24. ANNUAL REPORT ON CSR ACTIVITIES:
The Annual Report on CSR activities initiated and undertaken by the Company during the
year under review is annexed herewith as an ANNEXURE-04.
25. ANNUAL EVALUATION OF BOARD ETC.:
The Nomination and Remuneration Committee has formulated criteria for evaluation of the
performance of the each of the directors of the Company. On the basis of said criteria,
the Board and all its committees and directors have been evaluated by the Board of the
Directors and Independent Directors of the Company.
26. RELATED PARTY TRANSACTIONS:
During the year under review, all related party transactions entered into by the
Company, were approved by the Audit Committee and were at arm's length and in the ordinary
course of business. Prior omnibus approval was obtained for related party transactions
which are of repetitive nature and entered in the ordinary course of business and on an
arm's length basis. The Company did not have any contracts or arrangements with related
parties in terms of Section 188(1) of the Companies Act, 2013. Also, there were no
material related party contracts entered into by the Company during the year under review.
Details of related party transactions entered into by the Company, in terms of Ind
AS-24 have been disclosed in the notes to the standalone/consolidated financial statements
forming part of this Annual Report 2022-23.
27. CHANGES IN NATURE OF BUSINESS:
The Company has been engaged in the business of mining of captive iron ore and
manufacturing the Iron Ore Pellets, Sponge Iron, Steel Billets, Wire Rods, HB Wires with
generation of both conventional and nonconventional Power for captive consumption. There
is no change in the nature of business of the Company during the year under review.
28. CHANGES IN DIRECTORS & KEY MANAGERIAL PERSONNELS:
Based on the recommendations of the NRC, the Board of Directors of the Company, on July
29, 2022, in terms of the applicable SEBI Listing Regulations and provisions of the
Companies Act, 2013 read with Schedule IV, appointed Mr. Raj Kamal Bindal (DIN: 07423392)
and Mr. Samir Agarwal (DIN: 00093687) as Additional
Independent Non-Executive Directors of the Company subject to the approval of the
Members, not liable to retire by rotation, for a period commencing from July 29, 2022 to
July 28, 2027.
Mr. Raj Kamal Bindal brings to the Board his extensive knowledge and experience in
areas of adequate experience in Political Analysis, core understanding of issues that
affects Infrastructure sectors in India, and proficiency in using relationship building
skills to obtain long-term sustainable results in varied settings, successfully navigated
the complex corridors of bureaucracy and political leaders, understanding of Government
processes, working of Public Sector at all levels of Government in India and Provincial
Governments across India.
Similarly Mr. Samir Agarwal brings to the Board his extensive knowledge and experience
in areas of capital raising, mergers and acquisitions, financial structuring and corporate
restructuring.
On September 16, 2022, the Shareholders of the Company, by way of a special resolution,
approved the appointment of Mr. Raj Kamal Bindal and Mr. Samir Agarwal as Independent
Non-Executive Directors of the Company for the above-mentioned tenure.
Mr Parakhar Agrawal has resigned from the directorship of the Company with effect from
01.04.2022 and Mr. Bhrigu Nath Ojha and Mr. Harishankar Khandelwal have resigned from the
Directorship and Chairmanship/ Membership of the company from 29.07.2022. The Board of
Directors accepted their resignations and placed on record its deep sense of appreciation
for the services rendered and guidance given by them during their respective tenure of
office.
During the year, the designation of Mr. Vinod Pillai has been changed from Executive
Director to Non-Executive Director with effect from 01.04.2022.
On June 30, 2022, the Shareholders of the Company, by way of a special resolution,
approved the re-appointment of Mr. Dinesh Kumar Agrawal as Whole-time Director of the
Company for the period of five years with effect from 11.08.2022 and appointment of Mr.
Siddharth Agrawal and Mr. Dinesh Kumar Gandhi as Whole-time Directors of the Company for
the period of five years with effect from 01.04.2022.
In accordance with the provisions of Section 152(6) (c) of the Companies Act, 2013 and
the Company's Articles of Association, Mr. Dinesh Kumar Agrawal and Mr. Vinod Pillai,
Directors of the Company shall retire by rotation at the ensuing Annual General Meeting
and being eligible offers themselves for reappointment.
29. CHANGES IN STATUS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES:
A. HIRA FERRO ALLOYS LIMITED (HFAL):
During the year under review, the Company acquired additional 37,48,117 equity shares
of HFAL from the Promoter and Promoter Group of HFAL at an investment of RS. 79.46
crores enhancing its total stake from 75.66% to 91.82%. Also, the Company has subscribed
11,00,00,000 9% Optionally Convertible Cumulative Redeemable Participating Preference
Shares ("OCCRPPS") of RS. 10/- each at par, for repayment of borrowing
(debt raised for setting up solar power plant) of HFAL. HFAL is operating a Ferro alloys
manufacturing plant with capacity of 60,500 MT along with 20 MW captive thermal power
plant and 8.5 MW Bio-Mass IPP power plant and IPP wind mill of 1.5 MW. Moreover, HFAL is
also setting up of 55 MWp Solar Power Plant in the State of Chhattisgarh for captive
consumption out of which 30 MWp Captive Solar PV Power Plant of HFAL has already
commissioned and duly synchronized with the grid and charged on 29th March, 2023.
B. GODAWARI ENERGY LIMITED (GEL):
GEL does not have any business activity but have rights on a parcel of land located in
Chhattisgarh, which was earlier acquired for setting up thermal power project, which was
subsequently abandoned.
Our company is holding 100% equity share capital of the Company and has also subscribed
to 6,90,00,000 0.01% Optionally Convertible Debentures (OCDs) of RS. 10/- each
aggregating to RS. 69,00,00,000. During the year GEL has redeemed 27,50,000 OCDs of
RS. 10 each and paid RS. 2.75 Crores to the Company.
C. ALOK FERRO ALLOYS LIMITED (AFAL)
During the year the Company has acquired 37,79,220 equity shares of AFAL from the
Promoters and Other Shareholders of AFAL at an investment of RS. 126.98 crores
comprising of 78.96% of the total equity of AFAL. Thus, AFAL has become subsidiary of the
Company. AFAL is operating a Ferro alloys manufacturing plant with capacity of 14,500 MT
and a captive thermal power plant of 8.5 MW capacity.
D. JAGDAMBA POWER AND ALLOYS LIMITED (JPAL)
Your Company had subscribed to 26,05,000 equity shares of JPAL few years back, in order
to qualify for the captive user of the power generated by JPAL, as per Electricity Act and
rules framed thereunder. During the year under review, your, Company has already acquired
25MW Thermal Power Plant owned by JPAL on slump sale basis and surrendered 26,05,000
equity shares of RS. 10 each fully paid held by it in the Buyback Offer made by
JPAL, since there was no requirement for holding the equity share capital in JPAL,
consequent upon acquisition of Thermal Power Plant and accordingly, JPAL ceased to be an
associate of the Company.
Other than above, your Company has not entered into any other new Joint Ventures nor
terminated any existing Joint Ventures during the year under review. Similarly, other than
JPAL, there were no change in the Associates of the Company.
30. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY, ASSOCIATES AND JOINT VENTURE
COMPANIES:
Hira Ferro Alloys Limited (HFAL) - Subsidiary Company:
HFAL is engaged in the manufacture of ferro alloys with captive power generation. HFAL
also operates IPP power plant (Bio-Mass & Wind Mill). The operating & financial
highlights of HFAL for the year under review are as under:
Particulars |
FY23 |
FY22 |
% Change |
Production Volumes |
|
|
|
- Ferro Alloys (in Metric Tons) |
39647 |
47504 |
(-) 16.54% |
- Pig Iron (in Metric Tons) |
3509 |
0 |
100% |
- Captive Power (Units in Crores) |
1.42 |
16.20 |
(-) 91.23% |
- IPP Power (Units in Crores) |
6.57 |
9.92 |
(-) 33.77% |
Sales Realizations (H/MT) |
|
|
|
Net Sales (H In crores) |
453.78 |
593.21 |
(-) 23.50% |
EBIDTA (H In crores) |
41.20 |
169.01 |
(-) 75.62% |
PBT (H In crores) |
29.45 |
158.49 |
(-) 81.42% |
PAT (H In crores) |
21.79 |
113.49 |
(-) 80.80% |
The performance of the HFAL was impact due fall in ferro alloys prices during year as
compared to last year due and substantial increase in coal price in domestic and
international markets resulting into high increase in fuel prices. In view of high cost of
generation of thermal power, the Company decided to shut down its Thermal Power Plant and
drawn power from grid, which was comparatively cheaper and also shut down one of its ferro
alloys furnace to upgrade the same with higher capacity furnace, which resulted into power
operating volumes and profitability. The operating volumes are expected to improve during
the current year, consequent upon the commissioning of solar power plant and increase in
volumes in ferro alloys plant.
Alok Ferro Alloys Limited (AFAL) - Subsidiary Company:
AFAL is engaged in the manufacture of ferro alloys with captive power generation. The
operating & financial highlights of AFAL for the year under review are as under:
Particulars |
FY23 |
FY22 |
% Change |
Production Volumes |
|
|
|
Ferro Alloys (in Metric Tons) |
5278 |
14257 |
(-) 62.98% |
Net Sales (H In crores) |
63.91 |
134.65 |
(-) 52.54% |
EBIDTA (H In crores) |
3.54 |
34.43 |
(-) 89.72% |
PBT (H In crores) |
1.21 |
32.39 |
(-) 96.26% |
PAT (H In crores) |
0.69 |
23.77 |
(-) 97.08% |
In line with impacted on AFAL performance was also impacted on account fall in ferro
alloys prices in domestic & international markets. AFAL also took shut down of its
power plant during the year for replacement of power generating turbines with high
efficiency turbine, which resulted into lower operating volumes and profitability. AFAL
power plant has restarted effectively from second week of March, 2023 and the Company
expects to operate normally during the current year,
Ardent Steel Private Limited (ASPL) - Associate Company:
Particulars |
FY23 |
FY22 |
% Change |
Iron Ore Pellets Volumes in Metric Tons |
|
|
|
- Production |
6,34,786 |
7,47,850 |
(-) 15.12% |
- Sales |
6,29,505 |
7,70,378 |
(-) 18.29% |
Sales Realizations (H/MT) |
|
|
|
Net Sales (H In crores) |
479.25 |
842.80 |
(-) 43.14% |
EBIDTA (H In crores) |
37.37 |
151.00 |
(-) 75.25% |
PBT (H In crores) |
21.08 |
135.38 |
(-) 84.43% |
PAT (H In crores) |
15.51 |
99.00 |
(-) 84.33% |
ASPL is engaged in manufacturing of Iron ore Pellets having plant in Odisha. The
performance of ASPL also got impacted during the year in view of fall in Iron ore Pellet
prices in domestic & international markets.
The performance and financial position of the Company's subsidiaries namely Hira Ferro
Alloys Limited, Alok Ferro Alloys Limited and Godawari Energy Limited, Associate Company
namely Ardent Steel Private Limited for the Financial Year 2022-23 are also given in ANNEXURE
05.
The results of Associate Company viz., Chhattisgarh Ispat Bhumi Limited and Joint
Venture Companies namely Raipur Infrastructure Company Limited and Chhattisgarh Captive
Coal Mining Private Limited were not audited at the time of finalization of the Financial
Statements of the company. These Companies does not have major commercial operations and
therefore they have insignificant impact on the overall consolidated position of the
Company.
Moreover, Godawari Energy Limited and Chhattisgarh Captive Coal Mining Private Limited
have not yet commenced their commercial operations and their projects have been abandoned.
31. DIVESTMENT:
BUYBACK BY HIRA STEELS LIMITED (HSL)
The Company has surrendered 19,40,100 Equity Shares of RS. 10 each fully paid under the
Buyback offer made by Hira Steels Limited at an offer price of RS. 30 per share.
32. DEPOSITS:
The Company has not accepted any deposit from the public falling within the ambit of
Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules,
2014.
33. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES:
There were no contracts, arrangements or transactions entered into during fiscal 2023.
Hence the information as required under the Companies Act, 2013 in the prescribed Form
AOC-2 is not applicable.
34. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant and material orders passed by the Regulators/Courts which
would impact the going concern status of the Company and its future operations.
35. INTERNAL FINANCIAL CONTROLS:
The Company has in place adequate internal & financial controls with reference to
financial statements. During the year, such controls were tested and no reportable
material weakness in the design or operations were observed.
36. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an internal control system commensurate with the size and scale and
complexity of its operations. The scope and authority of Internal Audit functions have
been defined in the Internal Audit scope of work to maintain its objectivity and
independence, the Internal Audit functions reports to the Chairman of the Audit Committee
of the Board.
The Internal Audit department monitors and evaluates the efficacy and adequacy of
internal control system in the Company, its compliance with operating system, accounting
procedures and policies of the Company and its subsidiaries. Based on the report of the
Internal Auditors, process owners undertake corrective actions in their respective areas
and thereby strengthen the control. Significant Audit observations and corrective actions
thereon are presented to the Audit Committee of the Board.
37. MAINTENANCE OF COST RECORDS:
The Company is required to maintain cost records of the Company as specified under
Section 148 (1) of the Companies Act, 2013. Accordingly, the Company has properly
maintained cost records and accounts.
38. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION,
PROHIBITIONAND REDRESSAL) ACT, 2013:
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements
of the Sexual Harassment of Women at the Work Place (Prevention, Prohibition and
Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress
complaints received regarding sexual harassment. All employees (Permanent, Contractual,
Temporary, Training) are covered under this Policy. However, no complaints have been
received during the year 2022-23.
39. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Board of Directors have established 'Whistle Blower Policy' and 'Code of Conduct'
for the directors & employees of the Company as required under the provisions of Sec.
177 of the Companies Act, 2013 read with Rule 7 of the Companies (Meeting of Board and its
Powers) Rules, 2014 and Regulation 22 of Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015.
The said Policy has been properly communicated to all the directors and employees of
the Company through the respective departmental heads and the new employees are being
informed about the Whistle Blower Policy by the Personnel Department at the time of their
joining.
40. PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 (12) read with Rule 5 (1) of Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees
of the Company is given in ANNEXURE 06. The Statement showing the names and other
particulars of the employees of the Company as required under Rule 5 (2 &3) of
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not
required to be furnished since none of the employees of the Company has received
remuneration in excess of the remuneration mentioned in the above mentioned Rule 5 (2)
during the Financial Year 2022-23 except the following whose details are given below:
Particulars |
Details |
Name |
Mr. Bajrang Lal Agrawal |
Mr. Abhishek Agrawal |
Mr. Dinesh Agrawal |
Designation |
Managing Director |
Whole Time Director |
Whole Time Director |
Remuneration Paid |
RS. 3.6 Crore per annum |
RS. 3.0 Crore per annum |
RS. 3.0 Crore per annum |
Nature of employment, Whether contractual or otherwise |
Permanent |
Permanent |
Permanent |
Qualifications and Experience of the employee |
B.E (Electronic) and has a experience of more than 40 years in cement,
steel, power and mining sectors. |
B.E. (Electronics) & M. Sc International Business from University of
Leeds and has experience of more than 8 years. |
Electronic Engineer and experience in business for over 15 years. |
Date of commencement of employment |
17.08.2002 |
09.11.2011 |
21.09.1999 |
The age of such employee |
69 |
39 |
52 |
The last employment held by such employee before joining the Company |
N.A. |
N.A. |
N.A. |
The percentage of equity shares held by the employee in the Company
within the meaning of clause (iii) of sub rule (2) above |
Individually Holding: 2.07% Spouse Holding: 1.02% Total holding along
with spouse: 3.09% |
Individually Holding: 3.32% |
Individually Holding: 5.35% |
Whether any such employee is a relative of any director or manager of the
Company and if so, name of such director or manager |
Shri Abhishek Agrawal and Shri Siddharth Agrawal |
Shri Bajrang Lal Agrawal and Shri Siddharth Agrawal |
None |
Particulars |
Details |
Name |
Mr. Siddharth Agrawal |
Mr. Dinesh Kumar Gandhi |
Designation |
Whole Time Director |
Whole Time Director |
Remuneration Paid |
RS. 3.0 Crore per annum |
RS. 1.5 Crore per annum |
Nature of employment, Whether contractual or otherwise |
Permanent |
Permanent |
Qualifications and Experience of the employee |
MBA and has a experience of more than 11 years in establishment,
operation and maintenance of the Solar Thermal Power Plant and he has looked after the
project implementation, procurement of raw material, Plant maintenance, Production
activities and marketing of finished goods of M/s Godawari Power and Ispat Limited |
CA & CS and has experience of more than 30 years in the areas of
accounts, finance, project planning and financing. A dynamic financial analyst, his
competence strategically directs the company |
Date of commencement of employment |
01.04.2022 |
01.04.2022 |
The age of such employee |
42 |
61 |
The last employment held by such employee before joining the Company |
Managing Director of Godawari Green Energy Limited |
Whole Time Director of Godawari Green Energy Limited |
The percentage of equity shares held by the employee in the Company
within the meaning of clause (iii) of sub rule (2) above |
Individually Holding: 3.34% |
N.A. |
Whether any such employee is a relative of any director or manager of the
Company and if so, name of such director or manager |
Shri B.L. Agrawal and Shri Abhishek Agrawal |
N.A. |
41. CORPORATE GOVERNANCE REPORT:
Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations 2015, a separate section on corporate governance practices
followed by the Company, together with a certificate from the Company's Auditors
confirming compliance and a certificate of non-disqualification of directors from
Practicing Company Secretary forming an integral part of this Report is given as ANNEXURE
07.
42. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT:
The 'Business Responsibility and Sustainability Report' (BRSR) of your Company for the
year 202223 forms part of this Annual Report as required under Regulation 34(2)(f) of the
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is given as ANNEXURE
08. Your Company strongly believes that sustainable and inclusive growth is possible
by using the levers of environmental and social responsibility while setting targets and
improving economic performance to ensure business continuity and rapid growth.
43. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations 2015, a separate management discussion and analysis report which
forms an integral part of this Report is given as ANNEXURE 09.
44. DETAILS OF APPLICATIONS MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND
BANKRUPTCY CODE 2016:
There are no applications made during the financial
year 2022-23 by or against the company and there are no proceedings pending under the
Insolvency and Bankruptcy Code 2016.
45. DETAILS OF DIFFERENCES BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME
SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL
INSTITUTIONS ALONG WITH THE REASONS THEREOF:
Your company has not made any one time settlement with any of its lenders.
46. BOARD POLICIES:
The details of the policies approved and adopted by the Board as required under the
Companies Act, 2013 and SEBI Regulations are provided in ANNEXURE 10.
47. SECRETARIAL STANDARDS:
The Company has followed the applicable Secretarial Standards, i.e. SS-1 and SS-2,
relating to 'Meetings of the Board of Directors' and 'General Meetings' respectively.
48. ACKNOWLEGEMENTS:
The Board expresses its sincere gratitude to the shareholders, bankers/lenders,
Investors, vendors, State and Central Government authorities and the valued customers for
their continued support. The Board also wholeheartedly acknowledges and appreciates the
dedicated efforts and commitment of all employees of the Company.
|
For and on behalf of Board of Directors |
|
Place: Raipur |
B.L. Agrawal |
Abhishek Agrawal |
Date:20.05.2023 |
Managing Director |
Executive Director |
|
(DIN: 00479747) |
(DIN: 02434507) |