• NIFTY 11,596.90  (-0.78% )  
  • SENSEX 38,897.46  (-0.81%)  
  • USDINR 69.00  (0.12%)  
  • GOLD 34,936.00  (-0.44%)
  •  
  • Go
Corporate Information
  •         DIRECTOR'S REPORT
Jindal Stainless Ltd
Industry : Steel - Large
BSE Code:532508NSE Symbol:JSLP/E(TTM):11.34
ISIN Demat:INE220G01021Div & Yield %:0EPS(TTM):2.77
Book Value (Rupee ):51.636112Market Cap (Rupee Cr.):1504.76Face Value(Rupee):2
  • Change Company : 
  • Go

TO

THE MEMBERS,

Your Directors have pleasure in presenting the 38th Annual Report on the business and operations of your Company together with the Audited Statement of Accounts for the financial year ended 31st March, 2018.

FINANCIAL RESULTS

Your Company's performance for the financial year ended 31st March, 2018 is summarized below:

Sl.

No.

Particulars

For the financial year ended (Standalone)

For the financial year ended (Consolidated)

31.03.2018 31.03.2017 31.03.2018 31.03.2017
I Revenue from operations 10,963.67 8,957.40 11816.86 9924.78
II Other income 45.41 25.55 45.08 25.69
III Total income 11,009.08 8,982.95 11861.94 9950.47
IV Total expenses 10,527.21 8,920.37 11362.61 9872.28
V EBITDA 1,280.93 1,106.70 1,340.34 1165.59
VI Profit before exceptional items, share of net profit of investments accounted for using equity method and tax 481.87 62.58 499.33 78.19
VII Share of net profit of investments accounted for using equity method - - 15.77 11.48
VIII Profit before exceptional items and tax 481.87 62.58 515.10 89.67
IX Exceptional items 1.37 26.13 4.44 25.84
X Profit after exceptional items but before tax 483.24 88.71 519.54 115.51
XI Tax expense 164.97 30.37 174.04 32.47
XII Profit for the year 318.27 58.34 345.50 83.04
XIII Total other comprehensive income (0.57) (0.26) 15.58 (31.63)
XIV Total comprehensive income for the year (comprising profit and other comprehensive income for the year) 317.70 58.08 361.08 51.41

FINANCIAL HIGHLIGHTS

During the year, the revenue from operations of your Company on standalone basis has increased to Rs. 10,963.67 Crore as compared to Rs. 8,957.40 Crore during previous financial year 2016-17. The Profit before other income, Finance Cost, Depreciation, Exceptional Items, Tax & Amortisation (EBITDA) on standalone basis stood at Rs. 1,280.93 Crore as compared to Rs. 1,106.70 Crore during previous year. The Net profit on standalone basis stood at Rs. 318.27 Crore as compared to a net profit of Rs. 58.34 Crore during previous year.

Further, during the year, the consolidated revenue from operations of your Company has increased to Rs. 11,816.86 Crore as compared to Rs. 9,924.78 Crore during previous financial year 2016-17. Consolidated Profit before other income, Finance Cost, Depreciation, Exceptional Items, Tax & Amortization (EBITDA) stood at Rs. 1,340.34 Crore as compared to Rs. 1,165.59 Crore during previous year. The Net profit on consolidated basis stood at Rs. 345.50 Crore as compared to a net profit of Rs. 83.04 Crore during previous year.

Your Company has delivered a strong financial result for the second consecutive year. Your Company has reported a robust growth in PAT at Rs. 318.27 Crore in financial year 2017-18 as against Rs. 58.34 Crore during previous financial year, registering almost six times increase. EBIDTA is up by ~ 16% at Rs. 1,280.93 Crore in FY18. The robust performance in financial year 2017-18 reinforces that your Company has set itself on a strong and sustainable growth journey.

OPERATIONS

Your Company has been able to improve its performance significantly during the year 2017-18. Steel Melting Shop produced 7,97,156 MT as compared to 7,22,995 MT in the previous year. HAPL in CRM produced 6,44,393 MT against 5,92,113 MT in previous year and CAPL in CRM produced 3,88,038 MT against 3,44,725 MT produced in previous year.

The production at Ferro Alloys during the year was 1,99,950 MT against 2,05,510 MT during previous year. The Captive Power Plants (2 X 125 MW) generated 1,833 million units (net) of power as compared to 1,785 million units (net) in the previous year.

CERTIFICATIONS AND QUALITY STANDARDS

Your Company is certified for various product and management system certifications comprising of Quality Management System (ISO 9001), Environment Management System (ISO 14001) and Occupational Health & Safety Management System (BS OHSAS 18001). The certifications have successfully been upgraded to the latest versions and the unit is in receipt of the certificates as per ISO 9001:2015, ISO 14001:2015. The Company has undertaken initiative for obtaining Energy Management System certification (ISO 50001:2011) and has met the pre requisites for certification.

Various testing laboratories of the Company have adopted laboratory management system (ISO 17025:2005). The chemicals laboratories comprising of Materials, Steel Melt Shop & Coal Testing are already accredited to National Accreditation Board of Testing and Calibration Laboratory (NABL) as per ISO 17025:2005. Recently the Company's Mechanical and Metallurgical testing laboratory has got NABL accreditation adding another milestone in the journey of operational excellence. Scope of Construction Product Regulation (CE Marking) certification is expanded (applied and under process) to include grade EN 1.4462 of Duplex Stainless Steel. This will enhance Company's preference as certified manufacturer of stainless steel for construction field in the European market with 11 grades covered under the CE marking scope. AD/ PED certification is valid until Feb 2019 & PEMEX certification valid till sept 2018. Your Company's Jajpur Unit has successfully received DNV GL Approval for Marine Application and also received Approval from Bureau Veritas as per Marine & Offshore General Conditions.

Your Company has REACH/RoHS certification for 200, 300 & 400 series stainless steel grades. This includes compliance to the 7 new additions of Substances of Very High Concern (SVHC) in the REACH regulation 1907/2006.

Your Company has received ISI mark/ BIS certification for Stainless Steel grades as per IS 6911: 1992 (Stainless steel plate, sheet and strips). This has enabled us to be first stainless steel manufacturer to receive BIS license for stainless steel as per IS 6911: 1992. Other BIS license includes certifications as per IS 5522: 2014 (Stainless Steel Sheets and Strips for Utensils) and IS 15997:2012 (Low Nickel Austenitic Stainless Steel and Strip for Utensils and Kitchen Appliances).

Your Company is in receipt of JIS Mark Certification as per JIS (Japanese Industrial Standard) JIS G 4304, JIS G 4305 and JIS G 4312 requirements for stainless steel products. With JIS certification, your Company is able to sell stainless steel products in Japan and East Asian countries.

REVISION IN CREDIT RATING

In June, 2018, your Company received a rating upgrade from CARE, from BB+ to ‘BBB-', reflecting Company's improved profitability, strengthening balance sheet, and sustained operational progress.

EXIT FROM CORPORATE DEBT RESTRUCTURING MECHANISM

The Company has become eligible for exit from Corporate Debt Restructuring Scheme (CDR), basis the superior financial performance for the last two financial years. The consortium of lenders has already recommended for the CDR exit for the Company and the matter is pending for voting in CDR forum.

DIVIDEND & TRANSFER TO RESERVES

In terms of the Dividend Distribution Policy of the Company and as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI LODR"), equity shareholders of the Company may expect dividend if the Company is having surplus funds and after taking into consideration the relevant internal and external factors as mentioned in the said Policy. Accordingly, considering the cash position, fund requirements for growth of business of your Company and agreement with the Lenders, the Board of Directors has not recommended any dividend for the financial year ended 31st March, 2018. Therefore, no amount is also proposed to be transferred to the reserves of your Company. The Dividend Distribution Policy is available on Company's website at the following link:

http://www.islstainless.com/pdf/JSL-Dividend-Distribution-Policv 482018 R.pdf.

SHARE CAPITAL

As on 31st March, 2018, the paid up share capital of your Company was Rs. 124,41,04,594 divided into 47,92,21,660 equity shares of Rs. 2 each and 14,28,30,637 Optionally Convertible Redeemable Preference Shares having face value of Rs. 2 each ("OCRPS").

During the financial year 2017-18, your Company has on 26th May, 2017, allotted: (a) 6,05,70,320 equity shares to the lenders of your Company upon conversion of the Funded Interest Term Loan I and the Funded Interest Term Loan II at a price of Rs. 39.10 (including premium of Rs. 37.10) per share, aggregating to Rs. 236,82,99,512; and (b) 14,28,30,637 0.01% OCRPS to the lenders of your Company upon conversion of the Funded Interest Term Loan I and the Funded Interest Term Loan II at a price of Rs. 39.10 (including premium of Rs. 37.10) per OCRPS, aggregating to Rs. 558,46,77,906.70.

Further, your Company has on the 28th March, 2018 allotted 1,91,81,586 Equity Shares having the face value of Rs. 2 each to Virtuous Tradecorp Private Limited, a promoter group entity, upon conversion of 1,91,81,586 Compulsorily Convertible Warrants ("CCW") held by it.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report as required under the SEBI LODR forms part of this Annual Report.

BUSINESS RESPONSIBILITY REPORT

Your Company is committed to grow the business responsibly with a long term perspective as well as to the nine principles enshrined in the National Voluntary Guidelines (NVGs) on social, environmental and economic responsibilities of business, as notified by the Ministry of Corporate Affairs, Government of India, in July, 2011.

The Business Responsibility Report ("BRR") of the Company as per the requirements of Regulation 34(Rs. ) of the SEBI LODR describing the initiatives taken by the Company from an environmental, social and governance perspective, along with all the related policies can be viewed on the Company's website at www.jslstainless.com.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company has transferred unclaimed and unpaid amounts aggregating to Rs. 3,73,136 to Investor Education and Protection Fund. During the financial year 2017-18, there was no unclaimed dividend which was required to be transferred to Investor Education and Protection Fund of Government of India.

EMPLOYEES STOCK OPTION SCHEME

During the year under review, no stock options were vested in eligible employees. The disclosure, under Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 is set out in Annexure - I to this Report.

INFORMATION TECHNOLOGY

Your Company is on growth-path with digital transformation journey to support the operational efficiency using predictive analytics quality and maintenance. This journey will cover certain milestones which will help the organization to turn around its manufacturing capability. This journey aims to bring end to end operations visibility. This includes batch traceability, scrap yard, raw material yard, and slab yard and coil yard management for traceability, advance alerts, critical parameter monitoring, statistical process controls, scheduling, end-to-end quality integration and analytics.

As an early-adaptor of technology, your Company has achieved remarkable exposure to technology solution using SAP platform as core ERP solution through migration from SAP ECC6 with Oracle database to SAP ECC6 EHP8 with HANA Database. Also in this journey, Cloud 4 Customer (C4C) portal has been deployed to improve efficiency of sales team. In this project, Key Account Managers are equipped with all the relevant data related to each customer during their visit. It also helps to plan their visit to optimize their time. Your Company is now focusing on the integration of different HR applications to serve user seamless working on single platform by implementing cloud based solution Success Factor.

SAP has been successfully implemented at Company's subsidiary in Indonesia. Your Company has already embarked on the Disaster Recovery Setup process to secure the transactional data of SAP at different data centre locations.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Companies Act, 2013, SEBI LODR and Ind-AS on Consolidated Financial Statements read with Ind-AS-28 on investments in Associates and Ind-AS-31 on interests in Joint Ventures, the Audited Consolidated Financial Statements are provided in the Annual Report.

SUBSIDIARY COMPANIES / JOINT VENTURES / ASSOCIATE COMPANIES

Your Company follows its global ambition to build a premium brand name for its quality Stainless Steel solutions and expertise with the ambition and with a view of expansion and diversification, it has created subsidiaries, associates and joint ventures. As on the date of this Report, your Company has 5 direct subsidiaries, namely (i) Jindal Stainless UK Limited; (ii) Jindal Stainless FZE, Dubai; (iii) PT Jindal Stainless Indonesia; (iv) JSL Group Holdings Pte. Ltd., Singapore; and (v) Iberjindal S.L., Spain.

Your Company also has two joint venture companies namely, MJSJ Coal Limited and Jindal Synfuels Limited and three associate companies namely, Jindal United Steel Limited, Jindal Coke Limited and Jindal Stainless Corporate Management Services Pvt. Ltd. Further, your Company is an associate company of Jindal Stainless (Hisar) Limited.

During the financial year ended 31st March, 2018, no subsidiary has been liquidated. Jindal Stainless UK Limited is currently under liquidation.

The financial statements of subsidiary companies are kept open for inspection by the shareholders at the Registered Office and Corporate Office of your Company during business hours on all days except Saturdays and Sundays and public holidays up to the date of Annual General Meeting (AGM) as required under Section 136 of the Companies Act, 2013. The members, if they desire, may write to the Secretarial Department of the Company at O.P. Jindal Marg, Hisar - 125005 (Haryana) to obtain the copy of the financial statements of the subsidiary companies. The financial statements including the consolidated financial statements and all other documents required to be attached with this Report have been uploaded on the website of your Company viz. www.jslstainless.com .

A statement containing the salient features of the financial statement of the subsidiaries and associate companies in the prescribed Form AOC - 1 is attached along with financial statements. The statement also provides the details of performance and financial position of each of the subsidiary company.

Your Company has framed a policy for determining "Material Subsidiary" in terms of Regulation 16(6) of SEBI LODR. The Policy for determining material subsidiaries as approved may be accessed on your Company's website at the link:

http://www.islstainless.com/pdf/Policv%20on%20Material%20Subsidiaries.pdf

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board appointed Mr. Abhyuday Jindal as the Managing Director and Key Managerial Personnel of the Company w.e.f. 25th April, 2018. Prior to his appointment as the Managing Director, Mr. Abhyuday Jindal was Non-Executive Vice-Chairman of your Company. Mr. Ratan Jindal continues to be the Chairman and Managing Director of the Company.

Further, the Board has inducted Mr. Tarun Kumar Khulbe as an Additional Director on the Board of Directors w.e.f. 15th May, 2018 and appointed him as Whole Time Director and Key Managerial Personnel of the Company w.e.f. the said date. Dr. Rajeev Uberoi has been appointed as an Additional Independent Director w.e.f. 9th February, 2018. The requisite resolutions for appointment of Mr. Abhyuday Jindal as Managing Director, Mr. Tarun Kumar Khulbe as a Director and Whole Time Director and Dr. Rajeev Uberoi as an Independent Director, will be placed before the Members for their approval, at the ensuing Annual General Meeting ("AGM").

Mr. Subrata Bhattacharya has ceased to be Whole Time Director w.e.f. 15th May, 2018 and Mr. Sunil Yadav has ceased to be the Company Secretary and Compliance Officer of your Company w.e.f. 25th April, 2018. Ms. Ishani Chattopadhyay and Mr. Kanwaljit Singh Thind have ceased to be the Directors w.e.f. 9th May, 2017 and 26th September, 2017 respectively. The Board places on record its sincere appreciation for the valuable contributions made by them during their tenure.

The Board of Directors has appointed Mr. Navneet Raghuvanshi as the Company Secretary and Compliance Officer of your Company w.e.f. 25th April, 2018. The Board has also designated him as the Key Managerial Personnel (KMP) of your Company.

Mr. Ratan Jindal, who retires by rotation at the ensuing AGM under the provisions of the Companies Act, 2013 and being eligible, offers himself for re-appointment.

Brief resumes of the abovementioned Directors being appointed / re-appointed, nature of their expertise in specific functional areas, details of Directorship in other companies, membership / chairmanship of committees of the board and other details, as stipulated under Regulation 36(3) of SEBI LODR and Secretarial Standard - 2 issued by the Institute of Company Secretaries of India, are given in the Notice forming part of the Annual Report.

All Independent Directors have given declaration to the Company that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16 of SEBI LODR.

Your Company has also devised a Policy on Familiarization Programme for Independent Directors which aims to familiarize the Independent Directors with your Company, nature of the industry in which your Company operates, business operations of your Company etc. The said Policy may be accessed on your Company's website at the link:

http://www.islstainless.com/pdf/DETAILS%20OF%20FAMILIARIZATION%20%20PROGRAMMES%20IMPARTED%20TO%20INDEPENDE

NT%20DIRECTORS%20JSL.pdf

BOARD EVALUATION

An annual performance evaluation of all Directors, the Committees of Directors and the Board as a whole was carried out during the year. For the purpose of carrying out performance evaluation, assessment questionnaires were circulated to all Directors and their feedback was obtained and recorded.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION

Pursuant to the provisions of Section 178 of the Companies Act, 2013 and the SEBI LODR, the Board of Directors on the recommendation of the Nomination and Remuneration Committee has approved the (i) Policy for nomination and selection of Independent Directors and NonExecutive Non-Independent Directors and (ii) Remuneration Policy. The said policies may be accessed on your Company's website at the link:

http://www.islstainless.com/pdf/JSL%20Remuneration%20Policv.pdf

FIXED DEPOSITS

Your Company had stopped accepting / renewing deposits from 1 st April, 2014. In compliance of the CLB Order, your Company has repaid the entire outstanding deposits on 30th June, 2016. As on 31st March, 2018, your Company had total outstanding unclaimed deposits of Rs. 35,98,272.

The details relating to deposits, covered under Chapter V of the Companies Act, 2013 ("the Act")are provided hereunder:

(a) Accepted during the year: Nil

(b) Remained unpaid or unclaimed as at the end of the year due to pending clearance of cheques including interest: Rs. 35,98,272 (unclaimed)

(c) Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved: - no default has been made and hence these details are not applicable.

(i) at the beginning of the year: Not Applicable

(ii) maximum during the year: Not Applicable

(iii) at the end of the year: Not Applicable

(d) The details of deposits, not in compliance with the requirements of Chapter V of the Act: Nil

PARTICULARS REGARDING THE CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, 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 - II forming part of this Report.

PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules are provided in the Directors' Report, which forms part of this Annual Report.

Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 Rules are provided in the Directors' Report, which forms part of this Annual Report.

Having regard to the provisions of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the Registered Office of the Company during working hours and any member interested in obtaining such information may write to the Secretarial Department of the Company and the same will be furnished on request.

STATUTORY AUDITORS AND AUDITORS' REPORT

Walker Chandiok & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, were appointed by the Shareholders at the 37th Annual General Meeting of the Company held on 26th September, 2017, for a period of five consecutive years until the conclusion of the 42nd Annual General Meeting of the Company. The ratification of their appointment, pursuant to Section 139 of the Companies Act, 2013, is not required, in terms of Notification No. S.O. 1833(E) dated May 7, 2018, issued by the Ministry of Corporate Affairs and accordingly, the item has not been included in the Ordinary Business of the AGM Notice forming part of this Annual Report. The Statutory Auditors have confirmed that they are not disqualified from continuing as Auditors of the Company.

The Notes on financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification, reservation or adverse remark.

COST AUDITORS

In accordance with the provisions of Section 148 of the Companies Act, 2013 ("Act") read with the Companies (Cost Records and Audit) Rules, 2014, your Company is required to get its cost accounting records audited by a Cost Auditor. The Board has appointed M/s. Ramanath Iyer & Co., Cost Accountants, for this purpose for FY 2018-19. The Company maintains cost records as specified under Section 148 of the Act and gets them audited. The Cost Audit Report for the FY 2017-18 does not contain any qualification, reservation or adverse remark.

The remuneration payable to the Cost Auditors for the Financial Year 2018-19 shall be placed for ratification by members in terms of Section 148 of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014.

SECRETARIAL AUDITORS

The Board has appointed M/s. Vinod Kothari & Company, Practicing Company Secretaries, to conduct Secretarial Audit for the Financial Year 2018-19. The Secretarial Audit Report for the Financial Year ended March 31, 2018 is annexed herewith as Annexure - III to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

RISK MANAGEMENT

In terms of Regulation 21 of the SEBI LODR, as amended, the Company has constituted a Risk Management Committee which has been entrusted inter alia with the following functions: (a) Framing of Risk Management Plan and Policy; (b) Overseeing implementation / Monitoring of Risk Management Plan and Policy; (c) Identifying emerging risks and reviewing risk mitigation strategies; and (d) Formulating a cyber security plan and overseeing its implementation. Your Company has laid down procedures to inform Board members about risk assessment and minimization procedures. These procedures are periodically reviewed to ensure that executive management controls risk through means of properly defined framework.

INTERNAL FINANCIAL CONTROLS

Your 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 operation was observed.

AUDIT COMMITTEE

The Audit Committee comprises of the following four Directors out of which three are Independent Directors:

Sl. No. Name* Status Category
1 Mr. Suman Jyoti Khaitan Chairman Independent Director
2 Mr. T. S. Bhattacharya Member Independent Director
3 Mr. Gautam Kanjilal Member Nominee Director, Non-Independent
4 Dr. Rajeev Uberoi1 Member Independent Director

1 Dr. Rajeev Uberoi has been inducted as a Member of the Audit Committee w. e. f. 25th April, 2018.

* Mr. Kanwaljit Singh Thind was inducted as a Member of the Audit Committee w.e.f. 11th May, 2017 and he ceased to be a Director and consequently a Member of the Committee w.e.f. 26th September, 2017. Ms. Ishani Chattopadhyay ceased to be a Director and consequently a Member of the Committee w.e.f. 9th May, 2017.

All the recommendations made by the Audit Committee during the financial year 2017-18 were accepted by the Board.

CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility (CSR) Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy ("CSR Policy") indicating the focus areas of Company's CSR activities.

Though the Company is not mandated under Section 135 of the Companies Act, 2013 to incur expenditure on CSR, but being guided by the vision and philosophy of its Founder Late Shri. O. P. Jindal, your Company has planned interventions in the fields of education & vocational training, integrated health care, women empowerment, social projects, rural infrastructure development, environment sustainability & sports. The Disclosure as per Rule 9 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed to this Report at Annexure - IV.

The CSR Policy can be accessed on your Company's website at the link: http://www.islstainless.com/pdf/JSL%20CSR%20Policv.pdf.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Corporate Social Responsibility Committee comprises of the following three Directors out of which one is Independent Director:

Sl. No. Name Status Category
1 Mr. Ratan Jindal Chairman Executive, Non Independent
2 Mr. T. S. Bhattacharya Member Non-Executive, Independent
3 Mr. Tarun Kumar Khulbe1 Member Executive, Non Independent

1 Mr. Tarun Kumar Khulbe has been inducted as a Member w.e.f. 15th May, 2018. Mr. Subrata Bhattacharya ceased to be a Director and consequently a Member of the Committee w.e.f. 15th May, 2018.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has in place a policy on prevention of sexual harassment at workplace in accordance with the provisions of Prevention, Prohibition and Redressal of Sexual Harassment of Women at Workplace Act, 2013. The policy aims at prevention of harassment of women employees and lays down the guidelines for identification, reporting and prevention of sexual harassment. There is an Internal Complaints Committee (ICC) which is responsible for redressal of complaints related to sexual harassment and follows the guidelines provided in the policy.

During the year ended 31st March, 2018, no complaints were received pertaining to sexual harassment.

STOCK EXCHANGES WHERE THE SHARES ARE LISTED

National Stock Exchange of India Ltd., ("NSE") BSE Ltd.

Exchange Plaza, 5th Floor, Plot No. C/1, Phiroze Jeejeebhoy Towers,

G - Block, Bandra-Kurla Complex, Dalal Street,

Bandra (E), Mumbai - 400 051 Mumbai - 400 001

The annual listing fee was paid to both the Stock Exchanges. No shares of your Company were delisted during the Financial Year 2017-18. The Global Depository Shares ("GDS") are listed on Luxembourg Stock Exchange.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as Annexure -V.

NUMBER OF BOARD MEETINGS

The Board of Directors met 6 (six) times during the financial year ended on 31st March, 2018. The details of Board Meetings and the attendance of the Directors are provided in the Corporate Governance Report forming part of this Annual Report.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

Pursuant to the provisions of Section 177(9) of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI LODR, your Company has a Vigil Mechanism namely, Whistle Blower Policy for directors, employees and business partners to report genuine concerns about unethical behavior, actual or suspected fraud or violation of your Company's code of conduct or ethics policy. The Whistle Blower Policy is posted on the website of your Company and can be accessed at the link:

http://islstainless.com/pdf/WB%20Policv.pdf

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS BY THE COMPANY UNDER SECTION 186 OF THE COMPANIES ACT, 2013 ("THE ACT")

The particulars of loans, guarantees and investments by your Company under Section 186 of the Act are stated in Notes to Accounts, forming part of the Annual Report.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered and executed during the year under review were at arms' length basis. As per the provisions of Section 188 of the Companies Act, 2013 and Rules made thereunder read with Regulation 23 of SEBI LODR, your Company had obtained approval of the Audit Committee under omnibus approval route and / or under specific agenda before entering into such transactions.

Particulars of contracts or arrangements entered into by your Company with the related parties referred to in Section 188(1) of the Companies Act, 2013, in prescribed form AOC-2, is attached as Annexure - VI to this Report.

Your Directors draw attention of the members to notes to the financial statements which inter-alia set out related party disclosures. The Policy on materiality of related parties transactions and dealing with related parties as approved by the Board may be accessed on your Company's website at the link:

http://www.islstainless.com/pdf/Policv%20on%20dealing%20with%20Related%20Partv%20Transactions.pdf.

In terms of Regulation 23 of the SEBI LODR, all transactions with related parties, which are material in nature, are subject to the approval of the Members of your Company Requisite approval of the shareholders will be taken for this purpose at the ensuing AGM. The requisite resolutions in order to comply with the aforesaid requirements of Regulation 23 of SEBI LODR.

THE CHANGE IN THE NATURE OF BUSINESS, IF ANY

There has been no change in the nature of Company's business during the financial year ended on 31st March, 2018.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

During the quarter ended 30th June, 2018, your Company has achieved total revenue from operations of Rs. 3,146.75 Crore with EBITDA of Rs. 374.93 Crore. Your Company earned net profit of Rs. 90.85 Crore during this period.

ANY SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE

During the financial year 2017-18 there was no such significant material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.

SECRETARIAL STANDARDS

The Directors state that applicable Secretarial Standards, i.e., SS-1 and SS-2, relating to ‘Meetings of the Board of Directors' and ‘General Meetings', respectively, have been duly followed by the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013 with respect to directors' responsibility statement, it is hereby confirmed that:

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

(b) the Directors had selected such accounting policies and applied them consistently and made iudgments 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 31st March, 2018 and of the profit and loss of the Company for the year ended on that date;

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

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

(e) the Directors had laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively; and

(Rs. ) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

CORPORATE GOVERNANCE

A separate section on Corporate Governance and a certificate from the practicing Company Secretary regarding compliance of conditions of Corporate Governance as stipulated under the SEBI LODR, form part of the Annual Report.

ACKNOWLEDGEMENT

Your Directors would like to express their gratitude for the valuable assistance and co-operation received from shareholders, banks, government authorities, customers and vendors. Your Directors also wish to place on record their appreciation for the committed services of all the employees of the Company.

For and on behalf of the Board of Directors

Place: New Delhi Date: 17th July, 2018

Ratan Jindal

Chairman and Managing Director

DIN:00054026