• NIFTY 10,829.35  (0.82% )  
  • SENSEX 36,701.16  (0.63%)  
  • USDINR 71.73  (-0.22%)  
  • GOLD 38,810.00  (1.69%)
  •  
  • Go
Corporate Information
  •         DIRECTOR'S REPORT
Vedanta Ltd
Industry : Mining / Minerals / Metals
BSE Code:500295NSE Symbol:VEDLP/E(TTM):11.41
ISIN Demat:INE205A01025Div & Yield %:13.71EPS(TTM):12.05
Book Value (Rupee ):209.5121062Market Cap (Rupee Cr.):51111.42Face Value(Rupee):1
  • Change Company : 
  • Go

Dear Shareholders,

Your Directors hereby presents the report on the business and operations of the Company, together with the audited Consolidated as well as Standalone financial statements for the financial year ended March 31, 2019.

COMPANY PERFORMANCE

During the year, your Company saw setting of new production records across some of our businesses, commissioning of a new Zinc mine, significant and successful inroads in our Aluminium business and increase in our mineral and oil resources and reserves. Our three large businesses-Zinc, Aluminium and Oil & Gas achieved significant milestones at low cost and are strongly positioned for the near-term targets that we have set for these businesses.

We expect FY2020 to be another productive year with our three key businesses well positioned. In the case of our Zinc, Lead and Silver business, we will see the benefit of increased volumes. In Oil & Gas, we are India's largest private producer of crude, and rank with the world's lowest-cost producers with production, development and exploration pipeline. In Aluminium, we offer India's largest production capacity, supported by our own captive power generation and increasingly integrating backwards for our own Alumina. The strengths of our diverse portfolio, together with our focussed growth strategy expanding our reserves and resource base, a strong balance sheet, strong talent base, technology and modernisation initiatives, all combine to create a truly inspirational Company.

FINANCIAL PERFORMANCE SUMMARY

In compliance with the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) the Company has prepared its standalone and consolidated financial statements as per Indian Accounting Standards (Ind AS) for the FY2019.

Your Company's standalone and consolidated financial highlights are provided below:

(Rs in Crore)

Standalone

Consolidated

Particulars Year Ended March 31, 2019 Year Ended March 31, 2018 Year Ended March 31, 2019 Year Ended March 31, 2018
Net Sales/Income from Operations 38,098 45,496 90,901 92,011
Profit from operations before other income, finance costs and exceptional items 2,228 3,611 14,911 18,579
Other Operating Income 546 478 1,147 912
Other Income 6,152 3,559 4,018 3,205
Finance costs 3,757 3,353 5,689 5,112
Net exceptional items gain/(loss) 324 5,407 320 2,897
Profit/(loss) before tax 4,947 9,224 13,560 19,569
Tax expense/(credit) (128) 1,968 3,862 5,877
Net Profit/(loss) after tax 5,075 7,256 9,698 13,692
Share of profit/(loss) of associate NA NA 0 0
Minority Interest NA NA 2,633 3,350
Net Profit after taxes, minority interest and consolidated share in profit/(loss) of associate and before other comprehensive income 5,075 7,256 7,065 10,342
Paid-up equity share capital (Face value of Rs. 1 each) 372 372 372 372
Reserves excluding revaluation reserves as per balance sheet 77,508 78,941 61,925 62,940
Basic EPS after exceptional items 13.65 19.47 19.07 28.30
Transferred to General Reserve Nil Nil Nil Nil
Interim Dividend 7,005 7,881 7,005 7,881

The financial results and the results of operations, including major developments have been further discussed in detail in the Management Discussion and Analysis section.

OPERATIONAL HIGHLIGHTS FOR FY2019

1 ZINC INDIA

• Record underground mined metal production at 936kt, up 29% y-o-y. Total mined metal production marginally down 1% y-o-y, post closure of open-cast operations.

• Record lead metal production at 198kt, up 18% y-o-y.

• Record refined silver production at 679mt, up 22% y-o-y.

2 ZINC INTERNATIONAL

• At Gamsberg, commenced trial production in November 2018 and first shipment in December 2018.

3 OIL & GAS

• Average gross production of 189kboepd for FY2019, up 2% y-o-y.

• 11 development drilling rigs as at March 2019, with 99 wells drilled and 33 wells hooked up during FY2019 in Rajasthan.

• Production Sharing Contract (PSC) of Rajasthan block extended for 10 years, subject to conditions.

4 ALUMINIUM

• Record aluminium production at 1,959kt, up 17% y-o-y.

• Record alumina production from Lanjigarh refinery at 1,501kt, up 24% y-o-y .

• Q4 FY2019 hot metal cost of production significantly lower at $956 /ton, lower by 12% q-o-q.

5 POWER

• Record PAF of 88% at the 1,980 MW TSPL plant in FY2019.

6 IRON ORE

• Goa operations remain suspended due to state-wide directive from the Hon'ble Supreme Court; engagement continues with the Government for a resumption of mining operations.

• Production of saleable ore at Karnataka at 4.1 million tonnes, up 89% y-o-y.

y STEEL

• Record annual steel production at 1.2 million tonnes for FY2019, up 17% y-o-y.

• Achieved hot metal production run rate of c.1.5mtpa in FY2019.

g COPPER INDIA

• Due legal process being followed to achieve a sustainable restart of the operations.

SIGNIFICANT DEVELOPMENTS

ZINC INDIA

Zinc India has completely transitioned from open cast to fully underground mining with the business creating new records with mined metal production from underground operations at 936kt, up 29% y-o-y. We are expecting these volumes to increase to achieve the design capacity of 1.2 mt. The business now ranks 9th in the Elite Club of top 10 silver producers with a record production of 679 tonnes during the year, up 22% y-o-y.

+ ZINC INTERNATIONAL

Inaugration of Vedanta's Gamsberg mine by President Cyril Ramaphosa

On February 28, 2019, Vedanta announced inauguration of Vedanta Zinc International's (VZI) Gamsberg mine, outside Aggeneys in South Africa's Northern Cape Province by President Cyril Ramaphosa, which represents a US$400 million investment by Vedanta in South Africa.

OIL & GAS

Award of 41 exploration blocks in India pursuant to Open Acreage Licencing Policy at a total bid cost of US$551 million

Vedanta Limited was successfully awarded 41 exploration blocks in sedimentary basins throughout India pursuant to the Indian Open Acreage Licencing Policy ("OALP") at a total bid cost of US$551 million. The 41 blocks awarded to the Company comprises of 33 onshore blocks and 8 offshore blocks.

OALP is the first major auction of hydrocarbon blocks to take place in India since 2010 and provided an opportunity for the Group to acquire new acreages from all available areas in the sedimentary basins of India.

KG-OSN-2009/3 Discovery, Krishna-Godavari Basin, India

Your Company announced a hydrocarbon discovery in well A3-2 within its operated block KG-OSN-2009/3 within Krishna-Godavari Basin, East Coast of India. Vedanta Limited holds 100% participating interest in the block. A3-2 is the first exploration well drilled within the KG-OSN-2009/3 block. Multiple reservoir zones were encountered in the Mesozoic rift formation between the depths of 3351-3944m MDBRT with indications of hydrocarbon during drilling and formation evaluations.

KG-OSN-2009/3 Oil Discovery, Krishna-Godavari Basin, India

During the year, your Company announced an Oil Discovery in the second exploratory well H2, located in the block KG-OSN-2009/3, Krishna-Godavari Basin, East Coast of India. Vedanta Limited holds 100% participating interest in the block. Multiple reservoir zones were encountered in the well H2 within the Mesozoic sequence between the depths of 3310m to 4026m with hydrocarbon indications during drilling and down hole logging.

10 year PSC extension for Cairn, Oil & Gas operated Rajasthan Block

During the year, we received approval from the Government of India, acting through the Directorate General of Hydrocarbons, Ministry of Petroleum and Natural Gas for a ten-year extension of the Production Sharing Contract (PSC) for the Rajasthan Block, RJ-ON-90/1. The tenure of the RJ Block PSC has been extended for an additional period of 10 years with effect from May 15, 2020.

ALUMINIUM

The business achieved an all-time-high aluminium production at 1,959kt. We also achieved record alumina production from Lanjigarh refinery at 1,501kt. Structural changes put in place including increased Bauxite sourcing reducing our reliance on imported alumina, improved volumes from our alumina refinery, better coal availability, linkage and coal stock on hand and more efficient logistics have provided stability to the operations.

POWER

FY2019 was a significant year for the Talwandi Sabo Power Limited (TSPL) plant, where we achieved record plant availability of around 88%.

IRON

During the year, operations in Goa remained suspended due to a state-wide industry directive from the Supreme Court. We continue to engage with and encourage the Central and State Governments to resume production given the benefits to all stakeholders. In this regard, we welcome the efforts of the Goa Mining People Front and FICCI to reopen the industry in Goa.

COPPER

Production from our copper smelter plant at Tuticorin was suspended for the whole of FY2019. We continue to engage with the Government, the relevant authorities, the Courts and all stakeholders to enable the safe and supported restart of operations.

Meanwhile, we continue to operate our refinery and rod plant at Silvassa, catering to the domestic market.

CSR

Inauguration of 500th Nand Ghar reaching out to over 17,000 children

Your Company inaugurated 500th Nand Ghar at Chaksu Block in Jaipur and reached out to more than 17,000 children and 15,000 women, through this programme, aimed to lead the way for early childhood development in Rajasthan, Uttar Pradesh and Madhya Pradesh. We have also planned an outlay of Rs. 800 crore for setting up 4,000 Nand Ghars across India over next few years.

Through these 500 Nand Ghars, Vedanta is committed to ensure a better future for children and women.

ACQUISITIONS

Acquisition of Electrosteel Steels Limited under IBC

Pursuant to a Corporate Insolvency Resolution process implemented by way of the Insolvency and Bankruptcy Code 2016, your Company acquired Electrosteel Steels Limited, engaged in the business of manufacturing of steel with a total current capacity of 1.5 million tonnes per annum (MTPA) with a potential to increase the capacity to 2.5 MTPA. The operations have seen a complete turnaround in the last 10 months after acquisition with the operations achieving record production.

Your Directors believed that the acquisition will complement the Company's existing Iron Ore Business as the vertical integration of steel manufacturing capabilities has potential to generate significant efficiencies.

The detailed announcements made by the Company in this regard are available on the website of the Company at www.vedantalimited.com

ECONOMIC RESPONSIBILITY

It has been another successful year for Vedanta as we continue to deliver across our strategic priorities. We stay focussed on contributing by way of economic value creation and building trustworthy relations with the Governments and other stakeholders.

With these values being ingrained in Vedanta's DNA, we are proud to share that we have contributed c. 47% of our turnover, i.e. c. Rs. 42,400 crore to the public exchequer of the various countries where we operate.

Your Company publishes Tax Transparency Report which provides an overview of the tax strategy, governance and tax contributions made by the Company.

The report for the FY2019 is available on the website at www.vedantalimited.com

DIVIDEND DISTRIBUTION POLICY

For bringing transparency and to protect the interest of investors, your Company has in place a Dividend Distribution Policy formulated in accordance with Listing Regulations which sets out the parameters and circumstances to be considered by the Board in determining the distribution of dividend to shareholders and/or retaining profits earned by the Company. The Policy is available on the website of the Company at www.vedantalimited.com.

DIVIDEND

We have always believed in sharing the economic value generated. A consistent dividend is a healthy sign of a growing company. With a robust operational performance and a complementary market environment, we returned impressive numbers for FY2019.

The Company has declared the following dividends during the year out of the reserves of the Company and in compliance with the Dividend Distribution Policy:-

Type of Dividend Date of Declaration Record Date Rate of Dividend per share (face value Rs. 1 per share) % Total Payout (in Cr.)
1st Interim Dividend October 31, 2018 November 10, 2018 Rs. 17.00 1700 6,320
2nd Interim Dividend March 6, 2019 March 14, 2019 Rs. 1.85 185 685
Total Rs.18.85

The total dividend for the year stands at Rs. 18.85/- per equity share representing a dividend yield of ~8% based on last one-year average share price of the Company.

Further, the Board of Directors on October 10, 2018 have approved payment of Dividend on 7.5% Redeemable Non-Convertible Non-Cumulative Preference Shares (RPS) of face value Rs. 10/- each for a period from April 01, 2018 to October 27, 2018 as per the terms of issuance. These RPS were issued and allotted on April 28, 2017 and were due for redemption on October 27, 2018. The record date fixed for the same was October 22, 2018.

The Directors have not recommend final dividend for the financial year ended March 31, 2019.

CREDIT RATING

Your Company is rated by CRISIL and India Rating and Research Private Limited on its various debt instruments.

The details of ratings provided by the agencies is provided in the Corporate Governance Report.

SUSTAINABILITY

Sustainable Development is integral to Vedanta's core business strategy. We continue to be a transparent and responsible corporate citizen; committed to a Rs. social licence to operate' and partner with communities, local governments and academic institutions to help catalyse socio-economic development in the areas where we operate.

The Company reaffirms its Core Values of Trust, Entrepreneurship, Innovation, Excellence, Integrity,

Respect and Care, which are the basis of our Sustainable Development Model.

The model continues to be centered on the four strategic pillars: Responsible Stewardship; Building Strong Relationships; Adding and Sharing Value; and Strategic Communications.

With the Sustainable Development model, we built the Sustainable Development framework, which is aligned to global best practices and standards, including the United Nations Global Compact's (UNGC) 10 principles; the International Finance Corporation (IFC) performance standards; the International Council on Mining and Metals (ICMM) principles; UN Sustainable Development Goals (SDGs); and the Organisation for Economic Cooperation and Development (OECD) promoted Multinational Guidelines.

This robust framework provides the businesses and its leaders with the parameters on which to assess, monitor, review key sustainability priorities, such as safety, health, environment, stakeholder engagement and community development activities, as per the Company's approach on Rs. social licence to operate'.

The Vedanta Sustainability Assurance Program (VSAP) has been the bedrock in promoting transparency and compliance of all our businesses with the Group's Sustainable Development Framework. In continuation with last year, the big focus areas have been on implementation of ten key safety performance standards across the Group; VSAP process has categorically focussed on compliance level to these standards and highlighted areas of improvement.

During the year, we focussed heavily on safety performance of your businesses under the overarching umbrella of Health, Safety and Environment (HSE) best practices. Community engagement and development programmes were geared with emphasis on need assessments and longevity of the project and related outcomes/benefits.

Our resolve is strong, and we continue to work towards achieving zero harm.

Vedanta's teams across businesses are driving various capacity building and behavioural programmes. Our awareness campaigns aim to entrench a culture of safety and risk awareness. Training programmes on Rs. Making Better Risk decisions' is one such programmes rolled out across the businesses to improve safety decision making of leaders at all levels, particularly those on the front line. Similarly, Rs. Experience Based Quantification' (EBQ) using Bow Tie Risk Assessment methodologies were utilised to identify critical risks from safety and environmental perspective for key businesses. In FY2019, over 1.4 million hours of safety training were delivered to employees and contractors.

Our Company remains committed to decreasing its carbon footprint. Last year we stated our expectation to reduce our GHG intensity by 16% from a 2012 baseline by 2020. We are committed at ensuring that we develop our carbon reduction strategies in alignment with the framework laid out by the Taskforce on Climate related Financial Disclosures (TCFD).

A Carbon Forum has been internally constituted to develop our carbon strategy and provide governance on the risk to business from climate change.

Our businesses have made significant progress on our GHG reduction commitment. Hindustan Zinc Limited and Oil & Gas business have committed to increase their investment in solar power, while other businesses have made significant improvements in their process efficiencies, thereby reducing their GHG intensity emissions. As of March 31, 2019, we had been able to achieve about 14.6% reduction in our GHG intensity from our baseline number. We are confident of achieving our target by 2020.

Climate related financial risk is a part of our corporate risk register and we believe that climate resilience is the best approach we can take to safe guard our climate related business risks.

We ensure that our Biodiversity Management Plans are in place, and our environmental footprint follows the most rigorous global standards. We have developed specific objectives and targets, particularly with regards to water and energy management.

We remain committed to our agenda of "Zero Harm, Zero Waste, Zero Discharge". This year we were able to recycle more than 111% of the fly ash that was generated at our power plants. Large volumes of our high calorific hazardous wastes are also sent to the cement industry to be used as clinker fuel, thereby preventing them from being sent to secure landfills. This year, we have recycled 94% of our overall High Volume and Low Effect waste in sustainable applications and are continuing to develop new and innovative ways to increase the proportion of waste we recycle.

We are present in some of the world's most unique, remote and underdeveloped regions. We are committed to respect, learn from and create a shared understanding with our communities. Connecting with our communities is not just the right thing to do; it is a fundamental imperative of our Rs. license to operate'.

Our spend on our social investment and CSR programmes thereby reaffirm our commitment to ensuring the well-being of the communities who live in proximity to our operations.

Lessons from our experience in Tuticorin continue to guide us in improving engagement with our local stakeholders.

We have introduced revised stakeholder engagement and grievance mechanism standards and have initiated several projects to understand the perceptions and expectations of local communities from Vedanta. We are hopeful that these measures will help improve our social license to operate over a period of time.

We remain positive that our overall sustainability journey is headed in the right direction. Our sustainability framework is robust and in line with global practices on engaging with civil society, communicating performance on community development, human rights as well as addressing legacy issues. We are confident that it will help us achieve higher levels of performance in the years to come.

A separate detailed report on Company's Sustainability Development also forms part of the Annual Report.

CORPORATE SOCIAL RESPONSIBILITY

Your Company works towards a larger goal of creating enduring value for the communities it works in.

Towards that end, we undertake various need-based community programmes as part of our Corporate Social Responsibility (CSR). Putting the last as first being the top most priority, the Company has committed to align its CSR activities to the priorities of its neighborhood communities and also the national priorities including the Sustainable Development Goals.

For almost all our programmes, a bottom up community engagement approach is non-negotiable. This collaborative approach ensures community ownership, suitable project design, effective delivery and post project sustainability.

Apart from communities, we also strongly believe in partnering with government agencies, corporates, civil society organisations & community-based organisations to carry out durable and meaningful interventions.

All our CSR programmes are governed by the Vedanta CSR Policy, Corporate Technical Standards and each entity specific Standard Operating Procedures for CSR. The documents are periodically revised. Further, in order to benefit from diverse perspectives, and in keeping with a culture of collective leadership, Vedanta has formed a CSR Council. The Council is led by senior business leaders comprising of CSR Heads & CSR executives from the different Business Units. The Council is responsible for governance, synergy and cross learning across the Group CSR efforts. It meets every month and reviews the performance, spends and outcome of CSR programmes for all Business Units. The Council is instrumental in implementing improvement projects to create a seamless enabling eco-system for Business Units to carry out best-inclass community development programmes.

Vedanta has a strong Board CSR Committee including senior Independent Directors. The Committee provides strategic direction for CSR activities, and approves its plans and budgets. It also reviews progress and guides the CSR teams towards running well-governed and impactful community programmes.

Brief overview on Community Development Programmes for FY2019 is as under:

NAND GHAR AND CHILDREN'S

WELL-BEING PROJECTS

The importance of education for social growth and upliftment is undisputable and for Vedanta this is a very important pillar of its work with communities. Through our various education and childcare initiatives, we reached to around 1.55 lakh children.

The Nand Ghar Project is the Company's flagship national initiative, which aims to build new-age Anganwadis for ensuring the health and learning of young children in rural areas, and also as a platform for women's empowerment and skilling. The Project ultimately aims to impact 85 million children and 20 million women across 1.37 million Anganwadis in the country. During this financial year, we were proud to cross the 500 Nand Ghars mark, with 502 Nand Ghars now operational in 4 states of the country. The key metrics of their operational efficiency are tracked using an online and custom designed application.

As part of the Khushi initiative, HZL, in partnership with Government of Rajasthan strengthens the functioning of 3,089 ICDS Centres (called Anganwadis) in the 5 Districts of Hindustan Zinc's presence, reaching to over 60,000 children and caters to health, nutrition and pre-school need of children in the formative 0-6-year age group. The project also conducts periodic assessments to track developmental metrics of the kids. This year an average increase of 11% in children's learning capability was identified through these standardised assessments. Attendance also saw an increase with the average attendance increasing from 44% two years ago to 60% now.

Vedanta Limited Jharsuguda initiated a project called "Vedanta Vidyarthi Vikas Yojana (VVVY)' in the year 2009 to strengthen the education standards of secondary school students through remedial coaching classes. Since the beginning of VVVY project, quality education has been provided to the students of standard 8th to 10th and it's going through a remarkable growth in terms of quality education and passing percentage of children. Till date total of 3,975 students have been enrolled under VVVY project, 1,346 students appeared in matriculation examination and 1,130 students successfully passed with good marks.

WOMEN'S EMPOWERMENT

Women's empowerment is all about equipping and enabling women to make life determining decisions.

Vedanta recognises this need for empowering women and is running various projects to help the communities take a step towards a more equitable future. It is associated with around 35,000 women (up from 28,000 last year) and amongst them 3,600 women have started /revamped their own micro enterprises. One of our interventions in this space is the Subhalaxmi Cooperative Society in Jharsuguda which has emerged as a model community-based organisation.

The Cooperative has successfully completed 10 years of empowering women since its inception and currently is touching the lives of 3,793 members in 71 villages.

Through this programme, the Cooperative has been able to generate funds of Rs. 2.52 crore and through its various activities it has seen a significant increase in the income of the members.

HZL is running a similar programme called Sakhi which started three years ago and now has 1922 SHGs connecting the Company with 23,954 women. The total savings accumulated through this project are now at Rs. 6.22 crore and the total loans disbursed amounts to Rs. 17.13 crore, utilised for household consumption, agriculture, health & sanitation and 492 women utilised the loans to create new enterprises or expand existing enterprises.

HEALTH CARE

There is a great disparity in the quality and coverage of medical treatment in India. The majority of rural population lack basic primary healthcare and given that most of our operations are also in rural areas, enabling rural communities access to affordable and quality healthcare is an important focus for us. The Vedanta Hospital at Lanjigarh continues to provide much needed healthcare to thousands in the District of Kalahandi, Odisha. This year, the hospital has seen a total footfall of 67,425 patients, of which 6,935 were new patients and 11,664 were old patients. Further, 12,980 patients were treated through their Mobile Health Van.

VMRF

To prevent, control and eradicate cancer and illnesses related to it, Bharat Aluminium Company Limited (BALCO), a subsidiary of Vedanta started Vedanta Medical Research Foundation (VMRF), a voluntary, non-profit organisation. Balco Medical Centre, a state-of-art oncology facility in Naya Raipur, is its first flagship initiative. As the first super-specialty hospital with the capability to treat cancer, Balco Medical Centre's genuinely colossal impact is validated by the reception it received from the people and the milestones achieved-over 4,000 patients were served, more than 230 patients underwent radiation, 250 plus surgeries were performed and well past 1,000 chemotherapies were carried out.

AGRICULTURE AND ANIMAL HUSBANDRY

In much of rural India, the communities continue to rely heavily on agriculture and animal husbandry. We therefore follow a livelihood development approach of integrating agriculture, dairy, water management, technology, farmer's organisations and market outreach. To increase the income of farming community in Barmer through productivity enhancement of agriculture and livestock, project Unnati, a Cairn CSR initiative, was set up. More than 10,000 farmers benefitted through various interventions like horticulture demonstrations, construction & renovation of traditional water harvesting structures like KHADIN, etc. In similar line, through project SAMADHAN by HZL, the Company aims to improve the returns from Agriculture & Livestock for about 30,000 families. By the end of this year, the project had successfully worked with 8,660 farmers on agriculture and 8,944 farmers on livestock.

In Jharsuguda, to secure economic prosperity among identified households of Siripali village, Jeevika Samriddhi project was launched. The relevance of Jeevika Samriddhi project is based on the need to augment irrigation infrastructure, promotion of advanced agriculture, application of bio-fertiliser and pesticides and making farming as a remunerative profession. 111 farmers are benefiting from this project and because of this project, the irrigation potential of the village increased by 21.34%.

SKILLING THE YOUTH

To maximise the output from the immense demographic dividend India has, it is imperative that the youth are trained in skills suited for the current economic scenario. With the aim of channelising this untapped potential the Company is running a lot of skill development initiatives providing training to more than 3,000 youths. Balco in partnership with IL&FS is providing training to youth in five different high employment potential trades-Hospitality, Welding Assistant, Industrial stitching, Fitter Fabrication and Electrician. The institute has provided assured employment opportunities to 7,800 students since the inception of its operations. In Thoothukudi, Sterlite Copper through its Tamira Muthukkal project has provided vocational training to 2,000 youth and currently covers 500 more beneficiaries helping them gain skills thus increasing their employability.

A few other programmes ran by HZL, also aims at skilling the youth of Rajasthan and increase their employability.

HZL's Skilling and Entrepreneurship centres provide training to youth to become Domestic Electricians, Security Guard, General duty assistant, Sales entry and Data entry operators and in Micro Finance. Currently, 160 students are being trained and the plans are to train 700 youths each year. Through other initiatives like the Mining academy, ITI training at Maruti,

BPO training, etc. the Company has been able to reach 559 youths this year.

ENVIRONMENT PROTECTION

& RESTORATION

In our operations we make it a priority to operate in harmony with the natural environment. The Company is committed to safeguard the environment and makes extensive efforts to protect and restore nature. Pasumai Thoothukudi, an initiative by Sterlite Copper, launched on the World Forest Day with a vision of developing a green belt in Thoothukudi is an illustration of the significance of this commitment for the Company. The Company aims to plant 1 million trees and has already planted 800 saplings within 10 days of the launch of the programme.

SPORTS & CULTURE

Sports, at an individual level, helps build character, benefits health and for talented individuals becomes a source of livelihood. However, it is at a societal stage where sports can have a value-altering effect which can lead to a more tolerant and inclusive society. Vedanta identifies this dual impact that can be achieved through sports and thus its sports initiatives are focussed on two main objectives; Sports for all and Sports for excellence. Vedanta through its football initiatives in Rajasthan by Hindustan Zinc Football Initiative (ZF), and in Goa by the Iron Ore Business (Sesa Football Academy (SFA)), established on a reclaimed mine has taken great strides in getting closer to reaching these objectives. Zinc Football trains around 2,000 kids, both girls and boys in its 64 Zinc football schools. Sesa Goa also has 4 similar centres training 500 kids on a weekly basis. These centres enable the game to reach the masses and help create a culture of sports in the country. Both academies have their centres of excellence with state-of- art infrastructure that have not just developed players for their respective state teams but also contributed to the national setup with 7 alumni of SFA playing for the Indian national team and 8 playing in the elite Indian Super League. The second edition of Rs. Vedanta Women's Football League' saw involvement of 160 female football professionals and provided a platform for them to showcase their talents.

COMMUNITY INFRASTRUCTURE

Infrastructure development provides impetus for economic growth and it is no different for the villages in our operational areas. It not only helps elevate the quality of life in the villages, but also forms the foundation for socio-economical upliftment. The Company recognises this need and therefore is aiding the operational villages in developing basic infrastructure in villages, such as school toilets, drinking water projects, sports infra, local drains, community centres etc. as per local needs.

During the year, the Company's divisions spent Rs. 51.72 crore on CSR activities, while on a consolidated basis it spent about Rs. 309.24 crore on CSR.

A brief overview of CSR initiatives forms part of this Directors Report and is annexed hereto as Annexure A.

Your Company's CSR Policy addresses the Company's commitment to conduct its business in a socially responsible, ethical and environmentally friendly manner; and to continuously work towards improving the quality of life of the communities in the areas where it operates.

The policy may be viewed at www.vedantalimited.com

DIGITISATION INITIATIVES-CSR

I. Unified & Online CSR Reporting Platform for the Group

Vedanta has a large and complex CSR portfolio with multiple and diverse projects running across various locations. During the year, we have worked with Goodera, a global SaaS company, in assisting us with the development of a CSR lifecycle and volunteering technology platform that will assist in planning, managing, evaluating and reporting on our Corporate Social Responsibility (CSR) programmes.

The technology platform will enable Vedanta business Units to continuously measure progress and impact of CSR and volunteering projects, in real time, with last-mile visibility through impact dashboards. While enabling effective governance, this integrated technology platform will also assist in maximising the impact of every rupee spent via automation, intelligence and analytics for data-driven decision-making.

The platform will also empower Vedanta with solutions to engage employees across its geographies to create the culture of giving and volunteering seamlessly.

II. A web-enabled, online community grievance register-Rs. NIVAARAN'

Nivaaran is our internal community grievance/requests reporting and monitoring platform. This is an online web-enabled system developed this year by our Information Technology team. This central repository platform primarily aims to enable the submission of community requests/grievances from anywhere and anytime (24x7) by our stakeholder and CSR teams, who validate the request and take action for speedy closure of the same. Tracking grievances/requests is also facilitated on this portal through the system generated unique registration number. It also enables analysis of the data related to grievances across various categories including-type of grievance/requests, resolution time, location/asset etc.

CSRIMPACT ASSESSMENT

Taru Leading Edge assessed the impact of the CSR activities of Vedanta Group in the states of Rajasthan, Uttarakhand, Gujarat, Andhra Pradesh, Odisha, Chhattisgarh, Punjab, Goa, Karnataka and Jharkhand. This study employed various primary and secondary research techniques for comprehensive data gathering to arrive at objective insights which would assist in gauging the impact of the Company's current operational projects and help identify new interventions to improve these projects. Taru, for this study, deployed trained professionals to oversee the Survey, focus group discussions, and perform in-depth interviews with the community members, beneficiaries, government/local authority personnel etc. To assess the investment made for development of infrastructure, physical survey of the infrastructure was done. Over 6,000 samples were collected for Impact assessment along with 730 Key Informant Interviews/In-depth Interviews and 240 Focus Group Discussions.

Overall, all sectoral interventions under thematic areas of sustainable livelihoods, Health & Nutrition, Water, Sanitation & Hygiene (WASH), Energy & Environment, Education and Sports & Culture received positive feedbacks with around 60% households reporting having benefitted from at least one of the CSR interventions of the Vedanta Indian BUs.

Under the sustainable livelihoods, the CSR interventions reached out to at least 46% of the CSR beneficiaries and around 62% of these CSR beneficiaries reported an increase in household income. Other impacts included benefits such as Increase in yield and lifespan of livestock, more earning from livestock, and generation of more employment opportunities.

The Health & Nutrition CSR interventions of various BUs reached out to approximately 50% of the CSR beneficiaries and around 76% of these beneficiaries reported that they were able to save money on Medicine & Health and close to 70% reported an improvement in Healthcare Quality.

The WASH, Energy & Environment CSR initiatives of Vedanta Group were able to reach approximately 30% of the CSR beneficiaries and more than 60% of these beneficiaries reported impact and benefits such as improvement in general cleanliness in the focus areas, availability of water at home, women feeling safer with construction of toilet facility in the house and improvement in school attendance after construction of toilet in schools.

It was observed that through various interventions in the Education thematic area, more than 80% of the CSR beneficiaries reported an improvement in grades of children, increased interest in going to school and improvement in quality of education.

Vedanta Group has also implemented various other programmes such as Community Centres, Road Safety Programmes, Football Academy Project, Sports & Culture etc. which are also appreciated by the community and have created a positive impact.

INNOVATION, DIGITALISATION & TECHNOLOGY

Vedanta has made innovation a strategic priority by acknowledging the role innovation plays as an enabler across every facet of the business. Beyond this ideology, Vedanta has instilled innovation as a corporate value and the Group's leadership supports and incentivises employees in the establishment of a culture of innovation. This is because Vedanta's leadership believes that innovation, and not just incremental improvement, will help mitigate the volatility in commodity prices. Innovation, which encompasses technology and digitalisation, drives efficiency and sustainability. It is a central part of the Group's drive for operational excellence. We want to become an innovator company and to do this, we are focussed on not only acquiring best in class technology for our assets, but on creating our own.

Calling on two of our core values of entrepreneurship and innovation, we have stepped up our efforts to discover and implement new, innovative and disruptive technologies through the introduction of new systems and incentive programmes.

Across our business units, employees are encouraged to be creative in their thinking and approach. Ideas are valued by continually asking employees to think about what they and the Group can do differently. More than 1,000 ideas have been submitted, of these, 200 were selected for implementation and are being rolled out across the Group.

Of all the trends impacting the mining industry at present, digitalisation is arguably the most crucial, given its over-arching impact on every aspect of operations.

Offering significant potential for improving operational efficiency and lowering costs, digitalisation is opening up exciting opportunities at our several eading mines.

Hindustan Zinc's Sindesar Khurd mine is our most automated mine and has successfully implemented mine digitalisation. Here, we are moving into a new era of mining, where high speed WiFi networks and high bandwidth optical fibre forms the backbone of a new digital-enabled operating model.

At our Oil & Gas business, the world's longest, continuously-heated and insulated pipeline is one example of high technology standards. We remain ahead of the curve with industry leading extraction techniques like enhanced oil recovery and alkaline surfactant polymer, which have been deployed at the Mangala field. Extensive use of digital oil field software has improved reservoir management.

At Gamsberg, we have taken the application of technology a step further. Gamsberg has been conceptualised to be a digital mine. By introducing technology and digitalisation from the start, the operation will have leading-edge systems that report the state of the mine, the quality of ore, the conditions of the concentrator and the quality of the concentrate, all in real-time, to enable minute-by-minute decisions.

HUMAN RESOURCES (HR)

PEOPLE & CULTURE

Your Company has always aspired to build a culture that demonstrates world-class standards in safety, environment and sustainability. People are our most valuable asset and we are committed to provide all our employees with a safe and healthy work environment.

Our culture exemplifies our core values and nurtures innovation, creativity and diversity. We align our business goals with individual goals and enable our employees to grow on personal as well as professional front.

DIVERSITY

Diversity remains a strong focus. We are committed to provide equal opportunities to our employees regardless of their race, nationality, religion, gender or age. We are pleased with our progress to date on gender diversity, and women now represent 10.6% of our total workforce and 20% of our Board. We have set ourselves a target to reach over 33% women at senior levels by 2020 and aim to achieve 20% female representation amongst our employees.

We are also focussed on increasing the mix of geographies and nationalities in our workforce. Since most of our operations are in remote areas, we place a strong emphasis on recruiting employees from among the local population.

A significant percentage of the senior management team and our employees are recruited from the country in which our operations are located.

We strictly follow our Equal Opportunity policy to ensure there is no discrimination and all our decisions are based on meritocracy.

RECRUITMENT

We have put a range of initiatives in place to support us in hiring skilled professionals.

Right management in place (RMIP)

To re-emphasise the Group's philosophy of empowering the SBUs, we have reviewed our existing Business & SBU structures and followed a rigorous assessment process to ensure we have right talent in the right positions. The RMIP process also ensured that we have filled all the critical roles within our structures and any gaps in the management team are supported by strategic plans to fill vacancies. Our approach to recruitment is focussed on hiring diverse, high quality talent as well as expats and specialists.

Vedanta Leadership Development Program (VLDP)

VLDP is our flagship programme which aims to build organisational capability through developing talented individuals from premier management and technology institutes. It is a tailored programme which focuses on nurturing these bright minds to act as catalysts to steer our business to the next level of growth by implementing transformational ideas. The programme includes induction sessions, cross functional projects in significant roles, job rotation, development opportunities and continuous anchoring.

TALENT MANAGEMENT AND DEVELOPMENT

Internal Growth Workshops

We have always aimed to design an organisation which is spearheaded by our "Leaders from Within". Recognising internal talent and recruiting them to leadership roles has been the driving factor in our journey of rapid growth. Aligned with this philosophy, the Group conducts Rs. Chairman's Internal Growth Workshops' which enable our young leaders to fulfil their potential through development opportunities and provide us with a talent pipeline enabled to fill critical roles across the Group. These workshops have resulted in the development of 600+ high potential New Leaders across the Group's businesses who are given significantly elevated roles and responsibilities.

Leadership and Talent Analytics

We have partnered with experts to evaluate our existing talent management practices and implement best-in-class new initiatives for talent development. We are focussing on employing digital channels to run accelerated growth drives, workshops, in-house learning modules and other development opportunities.

360 Degree Feedback

At Vedanta we promote growth and nurturing of our internal talent pool by encouraging internal dialogue between senior leaders and their young mentees and peers. For this reason, we have launched a 360 Degree Feedback for our ExCo Leaders in collaboration with an external partner. We believe that this will help to fast track assessment and development of leaders and we aim to extend this to cover all our professionals in due course.

PERFORMANCE MANAGEMENT & TOTAL REWARDS

V-Perform: One Performance System for One Vedanta

At Vedanta, our focus is to constantly improve the level of automation in all our operations. V-Perform is a pan-Vedanta initiative to standardise the Performance Management System (PMS) and process across all Vedanta Group companies by leveraging technology. This enables functions, teams and individuals to track performance on a regular basis, evaluate efficiency through advanced analytics and implement proactive decisions towards achieving Vedanta's objectives.

We foster a culture of safety and sustainability to achieve our ultimate vision of "Zero Harm", "Zero Waste & "Zero Discharge". To enhance our safety performance in the workplace and strengthen our existing Safety Management System, a safety competency assessment process was completed mid-year by all employees.

Employee Stock Option Scheme ('ESOS')

Employee stock options are a significant component of our long-term incentives. They enable our employees to share in the success of the Company, encouraging high-growth performance and reinforcing employee pride with a focus on ownership.

Your Company has established a share incentive schemes viz. Rs. Vedanta Limited Employee Stock Option Scheme 2016' ("the Scheme"). The Scheme was framed with a view to reward employees for their contribution in successful operation of the Company with wealth creation opportunities, encouraging high-growth performance and reinforcing employee pride.

The Scheme is a conditional share plan for rewarding performance on pre-determined performance criteria and continued employment with the Company.

The pre-determined performance criteria shall focus on rewarding employees for Company performance vis-avis competition and also for achievement of internal operational metrics.

The Scheme was launched after obtaining statutory approvals, including shareholders' approval by way of postal ballot on December 12, 2016. In 2018, 35% of the workforce participated in this Scheme with a focus on our young & senior leaders, employees driving strategic projects and high impact task force members.

The Scheme is currently administered through Vedanta Limited ESOS Trust (ESOS Trust) which is authorised by the shareholders to acquire the Company's shares from secondary market from time to time, for implementation of the Scheme. During the year, the ESOS Trust was re-constituted by the Nomination & Remuneration Committee in its meeting held on July 13, 2018. The details of the trustees can be accessed at www.vedantalimited.com.

No employee has been issued stock options during the year, equal to or exceeding one percent of the issued capital of the Company at the time of grant.

During the year, the acquisition by the trust does not exceeded 2% of the paid-up capital of the Company. Further, the total acquisition by trust at no time exceeded 5% of the paid-up equity capital of the Company.

During the year under review 14,055,556 options were granted to 2,798 employees including Whole-Time Director and Key Managerial Personnel.

Pursuant to the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 ("Employee Benefits Regulations"), disclosure with respect to the ESOS Scheme of the Company as on March 31,2019 is available on the website of the Company at www.vedantalimited.com.

The Company confirms that the Scheme complies with the Employee Benefits Regulations and there have been no material changes to the plan during the financial year.

A certificate from M/s. S R Batliboi & Co. LLP, Chartered Accountants, Statutory Auditors, with respect to the implementation of the Company's ESOS schemes, would be placed before the shareholders at the ensuing Annual General Meeting. A copy of the same will also be available for inspection at the Company's Registered Office.

EMPLOYEE INFORMATION AND RELATED DISCLOSURES/PARTICULARS OF EMPLOYEES

The statement of Disclosure of Remuneration under Section 197 of the Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 ("Rules") is appended as Annexure B to the Report.

The information, as per Rule 5(2) of the Rules, forms part of this Report. However, as per provision of Section 136 of the Act and Rule 5(2), the Report and the Financial Statements are being sent to the Members of the Company excluding the statement of particulars of employees under Rule 5(2) of the Rules. The statement shall be available for inspection at the Company's Registered Office and any Member interested in obtaining a copy of the said statement may write to the Company Secretary.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace.

As part of Vedanta Group, your Company is an equal opportunity employer and believes in providing opportunity and key positions to women professionals. The Group has endeavoured to encourage women professionals by creating proper policies to tackle issues relating to safe and proper working conditions and create and maintain a healthy and conducive work environment that is free from discrimination. This includes discrimination on any basis, including gender, as well as any form of sexual harassment. During the period under review, eight complaints were received and resolved. Four employees were separated on account of complaints. Your Company has constituted Internal Complaints Committee (ICC) for various business divisions and offices, as per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

RISK MANAGEMENT

Your businesses are exposed to a variety of risks, which are inherent to a global natural resources organisation.

The effective management of risk is critical to support the delivery of the Group's strategic objectives. Risk management is embedded in the organisation's processes and the risk framework helps the organisation meet its objectives by aligning operating controls with the mission and vision of the Group set by the Board.

As part of our governance philosophy, the Board has a Risk Management Committee to ensure a robust risk management system. The details of Committee and its terms of reference are set out in the Corporate Governance Report, which forms part of this Annual Report.

Our risk-management framework is designed to be simple, consistent and clear for managing and reporting risks from the Group's businesses to the Board. Our management systems, organisational structures, processes, standards and code of conduct together form the system of internal controls that govern how we conduct business and manage associated risks. We have a multi-layered risk management framework to effectively mitigate the various risks, which our businesses are exposed to in the course of their operations.

The Risk Management Committee supports the Audit Committee and the Board in developing the group-wide risk-management framework. Risks are identified through a consistently applied methodology. The Company has put in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives.

Major risks identified by businesses and functions are systematically addressed through mitigating actions.

Risk officers have also been formally nominated at operating businesses, as well as at Group level, to develop the risk-management culture within the businesses.

The Risk Management Policy of the Company was revised by the Board in its meeting held on March 28, 2019 on the recommendation of the Risk Management Committee and Audit Committee to include cyber security.

For a detailed risk analysis, you may like to refer to the risk section in the Management Discussion Analysis Report which forms part of this Annual Report.

INTERNAL FINANCIAL CONTROLS

Your Board has devised systems, policies and procedures/ frameworks, which are currently operational within your Company for ensuring the orderly and efficient conduct of its business, which includes adherence to policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. In line with best practices, the Audit Committee and the Board reviews these internal control systems to ensure they remain effective and are achieving their intended purpose. Where weaknesses, if any, are identified as a result of the reviews, new procedures are put in place to strengthen controls. These controls are in turn reviewed at regular intervals.

The systems/frameworks include proper delegation of authority, operating philosophies, policies and procedures, effective IT systems aligned to business requirements, an internal audit framework, an ethics framework, a risk management framework and adequate segregation of duties to ensure an acceptable level of risk. Documented controls are in place for business processes and IT general controls. Key controls are tested by entities to assure that these are operating effectively. Besides, the Company has also adopted an SAP GRC (Governance, Risk and Compliance) framework to strengthen the internal control and segregation of duties/ access. It also follows a half-yearly process of management certification through the Control Self-Assessment framework, which includes financial controls/exposures.

The Company has documented Standard Operating Procedures (SOP) for procurement, project/ expansion management capital expenditure, human resources, sales and marketing, finance, treasury, compliance, Safety, Health and Environment (SHE), and manufacturing.

The Group's internal audit activity is managed through the Management Assurance Services ('MAS') function. It is an important element of the overall process by which the Audit Committee and the Board obtains the assurance on the effectiveness of relevant internal controls.

The scope of work, authority and resources of MAS are regularly reviewed by the Audit Committee. Besides, its work is supported by the services of leading international accountancy firms.

The Company's system of internal audit includes: covering monthly physical verification of inventory, a monthly review of accounts and a quarterly review of critical business processes. To enhance internal controls, the internal audit follows a stringent grading mechanism, focussing on the implementation of recommendations of internal auditors.

The internal auditors make periodic presentations on audit observations, including the status of follow-up to the Audit Committee.

The Company is also required to comply with the Sarbanes Oxley Act Sec 404, which pertains to Internal Controls over Financial Reporting (ICOFR). Through the SOX 404 compliance programme, which is aligned to the COSO framework, the Audit Committee and the Board also gains assurance from the management on the adequacy and effectiveness of ICOFR.

In addition, as part of their role, the Board and its Committees routinely monitor the Group's material business risks. Due to the limitations inherent in any risk management system, the process for identifying, evaluating, and managing the material business risks is designed to manage, rather than eliminate risk. Besides it created to provide reasonable, but not absolute assurance against material misstatement or loss.

Since the Company has strong internal control systems which are further strengthened by periodic reviews as required under the Listing Regulations and SOX compliance by the Statutory Auditors, the CEO and CFO recommend to the Board continued strong internal financial controls.

Based on the information provided, nothing has come to the attention of the Directors to indicate that any material breakdown in the function of these controls, procedures or systems occurred during the year under review. There have been no significant changes in the Company's internal financial controls during the year that have materially affected, or are reasonably likely to materially affect its internal financial controls.

There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their objectives. Moreover, in the design and evaluation of the Company's disclosure controls and procedures, the management was required to apply its judgement in evaluating the cost-benefit relationship of possible controls and procedures.

Further, the Audit Committee annually evaluates the internal financial controls for ensuring that the Company has implemented robust systems/framework of internal financial controls viz. the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

VIGIL MECHANISM

The Company has in place a robust vigil mechanism for reporting genuine concerns through the Company's Whistle-Blower Policy. As per the Policy adopted by various businesses in the Group, all complaints are reported to the Director-Management Assurance, who is independent of operating management and the businesses. In line with global practices, dedicated email IDs, a centralised database, a 24X7 whistle-blower hotline and a web-based portal have been created to facilitate receipt of complaints. All employees and stakeholders can register their integrity related concerns either by calling the toll free number or by writing on the web-based portal which is managed by an independent third party. The hotline provides multiple local language options.

All cases reported as part of whistle-blower mechanism are taken to their logical conclusion within a reasonable timeframe. After the investigation, established cases are brought to the Group Ethics Committee for decision-making. All Whistle-Blower cases are periodically presented and reported to the Company's Audit Committee. The details of this process are also provided in the Corporate Governance Report and the Whistle-Blower Policy is available on the Company's website at www.vedantalimited.com .

INVESTOR RELATIONS

Your Company has an active Investor Relations (IR) Programme and continuously strives for excellence in its IR engagement with international and domestic investors through various mediums such as quarterly earnings calls, Investor & Analyst Days, site visits, one-on-one and group meetings, participation in sell-side conferences and non-deal Roadshows.

The promoters of the Company and the senior management consisting of CEO and CFO involve themselves regularly in investor and analyst interactions. Depending on the context and need, the leadership team from businesses is also invited for these engagements.

Vedanta has set standards through the detailed and transparent disclosures on the Company's operational and financial performance. Your Company had created its first Integrated Report (for Financial Year 2018). Your Company initiated a new communication initiative which involves sending a brief update about the Company's performance and events to its shareholders and other stakeholders regularly. Having a diverse shareholder base and seven businesses demands enormous efforts from an IR function to manage investors and sell-side and to ensure that all business updates are provided timely and in complete. The dissemination of business updates through this "Investor Brief" has been well appreciated. As a key milestone in this continuing endeavour, your Company created a digital interactive microsite on the corporate website to provide an interactive experience beyond what is available in the annual and quarterly results materials.

Your Company benchmarks global IR standards and tries to be at par with them. The investor and the analyst community have appreciated your Company's IR team and practices being one of the best in the country. Your Company has been recognised for its IR efforts year on year by globally renowned forums.

CORPORATE GOVERNANCE REPORT

Your board seeks to embed and sustain a culture that will enable us to achieve our objectives through effective corporate governance and enhance transparent engagement with key stakeholders.

In our constant endeavour to benchmark our policies and practices and in light of various developments in the realm of corporate governance and regulatory reforms, your Company continues to maintain and implement the highest standards of corporate governance and ethical business practices across the globe.

A separate report on Corporate Governance setting out the governance structure, principal activities of the Board and its Committees and the policies and practices that enable the Board to fulfil its stewardship responsibilities together with a Certificate from the Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Listing Regulations is provided as an Annexure to the Annual report.

DIRECTORS & KEY MANAGERIAL PERSONNEL

We aim to bring a diverse and complementary range of skills, knowledge and experience to the Board, so that we are equipped to navigate the operational, social, regulatory and geopolitical complexity in which our business operates. Achieving the right blend of skills and diversity to support effective decision-making is a continuing process.

The detailed composition of the Board and Key Managerial Personnel (KMP) of the Company along with the changes in the board and KMP during the period under review are provided in the Corporate Governance Report.

DIRECTORS SEEKING RE-APPOINTMENT

Pursuant to the provision of Companies Act, 2013,

Ms. Priya Agarwal (DIN: 05162177), Non-Executive Director of the Company, is liable to retire by rotation at the ensuing Annual General Meeting (AGM) and being eligible, has offered herself for re-appointment. Accordingly, the appointment of Ms. Priya Agarwal is being placed for approval of the members at the AGM. A brief profile of Ms. Priya and other related information is provided in the AGM notice. The Board on the recommendation of Nomination & Remuneration Committee recommends her re-appointment at the AGM.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declaration from all the Independent Directors that they continue to meet the criteria of independence as provided under the Companies Act and Listing Regulations and comply with the Code for Independent Directors as specified under Schedule IV of the Act.

The Directors have also confirmed that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence.

BOARD DIVERSITY & INCLUSION

Your Company believes that a diverse and inclusive Board is essential for achieving long-term growth and development of the Company. This ensures timely anticipation of risks and opportunities. The Company has a diverse Board consisting of Directors possessing variety of skills, expertise, qualifications and experience. The details of the key qualifications, skills and attributes are forming part the Corporate Governance Report.

POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION

The Company's Nomination & Remuneration Policy sets out the criteria for determining qualifications, positive attributes and independence while evaluating a person for appointment/ re-appointment as Director or as KMP, with no discrimination on the grounds of ethnicity, nationality, gender or race or any other such factor.

The salient features of the Policy and the changes during the year are provided in the Corporate Governance Report and the policy is also available on the website of the Company at www.vedantalimited.com

FAMILIARISATION PROGRAMME FOR BOARD MEMBERS

Your Company has a separately defined Familiarisation Programme for its Directors which aims to provide insights to the newly inducted Directors about the Company, its operations, business, industry and environment and also to update the Directors on a continual basis.

The details of training and familiarisation programme process for Directors have been provided under the Corporate Governance Report and is also available on the website of the Company at www.vedantalimited.com

BOARD EVALUATION

Your Board is committed to transparency in assessing the performance of Directors. The Company has put in place a robust framework for evaluation of the Board, its Committees the Chairman, and Individual Directors and the governance processes that support the Board's work.

The Company engaged the services of a leading HR consultancy, to conduct the entire process of Board evaluation and the same was facilitated through an online secured module ensuring transparent, effective and independent of involvement of the management. The evaluation was conducted through questionnaires having qualitative parameters and feedback based on ratings. Recommendations arising from the evaluation process were considered by the Board to optimise its effectiveness.

The outcome of the Board evaluation was discussed by the Nomination & Remuneration Committee and the Board at the meeting held on March 28, 2019.

A detailed update on the Board Evaluation is provided in the Corporate Governance Report.

BOARD & COMMITTEE MEETINGS

The Board in conjunction with its Committees meets at regular intervals to ensure all decisions are taken timely. The Board met 10 times during the FY2019. The details of Board committees as on March 31, 2019 are provided below:

STATUTORY BOARD COMMITTEES

Further, the Board of Directors at their meeting held on January 31,2019 have also constituted Sustainability Committee w.e.f. April 1, 2019.

The details on Board, its committees, their composition and terms and reference and meetings held during FY2019 and attendance is provided in the Corporate Governance Report.

All the recommendations made by each of the Committees were accepted by the Board.

AUDITORS AND AUDITORS' REPORT

STATUTORY AUDITORS

• M/s. S R Batliboi & Co.

LLP, Chartered Accountants (FRN: 301003E) were appointed as Statutory Auditors of your Company at the AGM held on June 29, 2016 for a term of five consecutive years i.e. until the conclusion of the 56th AGM.

• The report of the Statutory Auditor forming part of the Annual Report , does not contain any qualification, reservation, adverse remark or disclaimer.

The observations made in the Auditors' Report are self-explanatory and therefore do not call for any further comments.

• M/s. S R Batliboi & Co.

LLP have confirmed their independence and eligibility under the provisions of the Act & Listing Regulations.

COST AUDITORS

• Your Company is required to have the audit of its cost records conducted by a Cost Accountant in practice.

• The Board has appointed M/s. Shome and Banerjee as Cost Auditors for its Oil & Gas Business and and M/s. Ramnath Iyer & Co for other business segments to conduct cost audit for year ended March 31, 2019.

• Further M/s. Ramnath Iyer & Co. have been appointed as the Lead Cost Auditors of the Company.

• The said auditors have been re appointed for FY2020 as well.

SECRETARIAL AUDITOR

• The Company has appointed M/s. Chandrasekaran

& Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the Company for FY2019.

• The Report of the Secretarial Audit in Form MR-3 is annexed herewith as Annexure D. Further, the Annual Secretarial Compliance Report is available on the website at www.vedantalimited.com .

• The Secretarial Audit Report does not contain any qualifications, reservation, adverse remarks or disclaimer.

• The Board has re-appointed M/s. Chandrasekaran & Associates as Secretarial Auditors for FY2020.

INTERNAL AUDITOR

• M/s. Deloitte Haskins & Sells, LLP was appointed as the Internal Auditors for FY2019.

• The Group's internal audit activity is managed through the Management Assurance Services ('MAS') function.

• The Board, on the recommendation of the Audit Committee has re-appointed M/s. Deloitte Haskins & Sells, LLP as the Internal Auditors for FY2020.

REPORTING OF FRAUDS BY AUDITORS

During the year under review, the Statutory Auditor, Cost Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under Section 143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, a detailed report on the Management Discussion and Analysis is presented in a separate section in the Annual Report.

DETAILS OF LOANS/ GUARANTEES/ INVESTMENT MADE BY THE COMPANY

The particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised as per the provisions of Section 186 of the Act are provided in the standalone financial statement. (Please refer to Notes to the standalone financial statement).

The Company has a policy on material subsidiaries and the same may be accessed at www.vedantalimited.com.

DEBENTURES

During the financial year, your Company raised Rs. 5,000 crore through issuance of secured, rated, redeemable, non-cumulative, non-convertible debentures of face value of Rs. 1,000,000 each on private placement basis as per the following details:

Coupon Rate Date of Allotment No. of NCDs Total Amount Tenor Maturity Date
8.50% Secured Redeemable Non-Convertible Debentures-Series I April 5, 2018 23,500 2,350 3 years April 5, 2021
8.50% Secured Redeemable Non-Convertible Debentures-Series II April 5, 2018 16,500 1,650 3 years 2 months & 10 Days June 15, 2021
9.18% Secured Redeemable Non-Convertible Debentures July 4, 2018 10,000 1,000 2 years & 363 days July 2, 2021

The aforesaid debentures are listed on BSE Limited.

FIXED DEPOSITS

As reported last year, the Company has discontinued the renewal of its fixed deposits on maturity. As at March 31,2019 deposits amounting to ? 54, 000 remains unclaimed. Since the matter is sub judice, the Company is maintaining status quo.

TRANSFER TO RESERVES

The Company proposes Nil transfer to General Reserve out of its total profit of Rs. 5,075 crore for the financial year.

CAPITAL STRUCTURE

The Authorised Share Capital of the Company is Rs. 74,12,01,00,000 divided into 44,020,100,000 number of equity shares of Rs. 1/- each and 3,010,000,000 Preference Shares of Rs. 10/- each.

During the year the Company redeemed 3,010,000,000 Preference Shares of Rs. 10/- each as per their terms of issuance. The paid-up share capital of the Company was reduced from Rs. 33,817,504,871 divided into 3,717,504,871 equity shares of face value of Rs. 1 each and 3,010,000,000 preference shares of face value of Rs. 10 each to 3,717,504,871 equity shares of Rs. 1 each.

The details of share capital as on March 31, 2019 is provided below:-

Particulars Amount (Rs)
Authorised Share Capital 74,12,01,00,000
Paid up Capital 3,71,75,04,871
Listed Capital 3,71,71,96,639
Shares under Abeyance pending allotment 3,08,232

*308,232 equity shares are pending for allotment and listing hence, are kept under abeyance category since they are subjudice.

UNCLAIMED SHARES

Pursuant to the SEBI Circular and Regulation 39 of the Listing Regulations regarding the procedure to be adopted for unclaimed shares issued in physical form in public issue or otherwise, the Company has a separate demat account in the title of Rs. Vedanta Limited-Unclaimed Suspense Account' with M/s. Karvy Stock Broking Limited. The details of shares lying in the unclaimed suspense account are provided below:

Description No. of shareholders No. of Equity shares of Rs.1 each
Aggregate number of shareholders and the outstanding shares in the suspense account lying at the beginning of the year 4,018 3,403,603
Number of shares transferred to the unclaimed suspense account during the year 0 0
Number of shareholders who approached issuer for transfer of shares from suspense account during the year 80 98,681
Number of shareholders to whom shares were transferred from suspense account during the year - -
Number of shares transferred to IEPF account pursuant to Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 read with Amendment Rules, 2017 1,221 654,660
Aggregate number of shareholders and the outstanding shares in the suspense account lying at the end of the year. The voting rights on these shares shall remain frozen till the rightful owner of such shares claims the shares 2,717 2,650,262

TRANSFER OF UNPAID AND UNCLAIMED AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

In accordance with provision of Companies Act and IEPF Rules, the Company is required to transfer the following amounts to IEPF:-

• Dividend amount that remains unpaid/unclaimed for a period of 7 years;

• Shares on which the dividend has not been paid/claimed for 7 consecutive years or more

Your Company in its various communications to the shareholders from time to time, request them to claim the unpaid/unclaimed amount of dividend and shares due for transfer to the IEPF account established by Central Government. Further, in compliance with the IEPF (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF Rules) including statutory modifications thereof, the Company publishes notice in newspapers and also sends specific letters to all the shareholders, whose shares are due to be transferred to IEPF, to enable them claim their rightful dues.

The details of dividend transferred during the year is provided below:

Dividend transferred to IEPF during the year

Financial Year Type of Dividend Dividend declared on Amount transferred to IEPF (in Rs. ) Date of transfer to IEPF
2010-11 Interim Dividend March 12, 2011 1,23,51,835.00 May 9, 2018
2010-11 Final Dividend July 25, 2011 52,19,694.00 September 21, 2018
2010-11 Final Dividend July 21, 2011 1,73,95,336.00 September 24, 2018
2010-11 Final Dividend August 14, 2011 19,77,927.00 August 31, 2018
2011-12 Interim Dividend October 24, 2011 56,27,575.00 December 19, 2018
2011-12 Total Interim Dividend January 25, 2012 1,01,63,686.00 5,27, 36,053.00 March 16, 2019

Unpaid dividend on the shares on which there was a specific order of court/ tribunal/ statutory authority restraining transfer of such shares and dividend thereon, were not transferred to IEPF pursuant to Section 124 of the Companies Act, 2013 and Rule 6 of IEPF (Accounting, Audit, Transfer and Refund) Rules, 2016 including statutory modifications or re-enactments thereof.

Dividend declared during the year transferred to IEPF

Financial Year Type of Dividend Dividend declared on Amount transferred to IEPF (in Rs. ) Date of transfer to IEPF
1st Interim Dividend October 31, 2018 3,99,58,228.00 November 22, 2018
2018-19 2nd Interim Dividend March 6, 2019 43,48,395.40 March 18, 2019
Total 44,306,623.40

Shares transferred/credited to IEPF

During the year, the Company transferred 1,346,250 equity shares of Rs. 1/- each comprising of 2,399 shareholders to IEPF.

The Company has also uploaded the details of unpaid and unclaimed amounts lying with the Company as on August 24, 2018 (date of last Annual General Meeting) on the Company's website www.vedantalimited.com. Further, the details of equity shares transferred are available on the Company's website www.vedantalimited.com.

The shareholders whose shares/dividends have been transferred to IEPF can claim the same from IEPF in accordance with the prescribed procedure and on submission of such documents as prescribed under the IEPF Rules. The process for claiming the unpaid dividend/shares out of the IEPF can be accessed at www.iepf.gov.in .

The dates on which unclaimed dividend and their corresponding shares would become liable to be transferred to the IEPF during the FY 2020 is provided below:

Dividend to be transferred to IEPF during FY 2020

Dividend Date of Declaration of Dividend Due date for transfer to IEPF Amount (As on March 31,

2019)

Final Dividend 2011-12 29-Jul-2012 28-Aug-19 18,12,052.50
Final dividend 2011-12 24-Apr-2012 7-Sep-19 1,01,03,138.00
Final Dividend 2011-12 25-Apr-2012 18-Sep-19 59,70,651.00
Interim Dividend 2012-13 (1st) 23-Oct-2012 28-Dec-19 64,03,296.90
Interim 2012-13 31-Oct-2012 5-Jan-20 44,62,555.00
Interim Dividend 2012-13 (2nd) 30-Oct-2012 4-Jan-20 14,49,220.00
Total 3,02,00,913.40

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

Your Company has 54 subsidiaries (15 direct and 39 indirect) as at March 31,2019, as disclosed in the notes to accounts.

During the year and till date the following changes have taken place in subsidiary companies:

Subsidiary companies formed/acquired:

• Vedanta Star Limited acquired on April 23, 2018 •

• Electrosteel Steels Limited acquired on June 4, 2018

As at March 31, 2019, the Company has 5 associate companies and joint ventures.

Associate Companies and Joint Ventures:

• RoshSkor Township (Pty) Limited

• Gaurav Overseas Private Limited

• Goa Maritime Private Limited

• Madanpur South Coal Company Limited

• Rampia Coal Mines and Energy Private Limited

As required under Listing Regulations, the Consolidated Financial Statement of the Company and its subsidiaries, prepared in accordance with Ind AS 110 issued by the Institute of Chartered Accountants of India, form part of the Annual Report and are reflected in the Consolidated Financial Statement of the Company.

During the year, the Board of Directors have reviewed the affairs of the subsidiaries. Pursuant to Section 129(3) of the Companies Act 2013 (the Act), a statement containing the salient features of the financial statement of the subsidiaries and associate companies is attached to the financial statement in Form AOC-1. The statement also provides details of performance and financial position of each of the subsidiaries.

In accordance with Section 136 of the Act, the audited Standalone and Consolidated financial statements of the Company along with relevant notes and separate audited accounts of subsidiaries are available on the website of the Company at www.vedantalimited.com. A copy of the financial statements of the Company and of the subsidiary companies shall be made available upon request by any member of the Company. Additionally, these financial statements shall be available for inspection by members at the Registered Office of the Company.

RELATED PARTY TRANSACTIONS

Your Company has in place a Policy on Related Party Transaction (RPT) (RPT Policy) formulated in line with the provision of the Companies Act and Listing Regulations.

The Policy may be accessed at www.vedantalimited.com.

The Policy sets out the philosophy and processes to be followed for approval and review of transactions with Related Party and intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions with Related Parties.

A detailed landscape of all RPTs to the Audit Committee, specifying the nature, value, and terms and conditions of the transaction is presented to the Audit Committee.

Also, a Related Party Transactions Manual-Standard Operating Procedures has been formulated to identify and monitor all such transactions.

During the fiscal 2019, all the contracts/ arrangements/ transactions entered into by the Company with the related parties were in the ordinary course of business and on an arm's length basis and were in compliance with the provisions of the Companies Act and Listing Regulations.

Further, there have been no materially significant RPTs during the year pursuant to the provisions of the Companies Act and Listing Regulations. Accordingly, the disclosure required u/s 134(3)(h) of the Act in Form AOC-2 is not applicable to your Company.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

Provided below are the significant and material orders which have been passed by any regulators or courts or tribunals against the Company impacting the going concern status and Company's operations in future.

Iron-Ore Division-Goa Operations

Supreme Court (SC) in the Goa Mining matter in 2014 declared that the deemed mining leases of the lessees in Goa expired on November 22, 1987 and the maximum of 20 years renewal period of the deemed mining leases in Goa under the MMDR Act had also expired on November 22, 2007 and directed state to grant fresh mining leases.

Thereafter, various mining leases were renewed by the state government before and on the date the MMDR Amendment Ordinance 2015 came into effect (i.e. January 12, 2015).

These renewal of mining leases were challenged before the SC by Goa Foundation and others in 2015 as being arbitrary and against the judgement of the SC in the earlier Goa mining matter. The Supreme Court passed the judgement in the matters on February 7, 2018 wherein it set aside the second renewal of the mining leases granted by the State of Goa. The court directed all lease holders operating under a second renewal to stop all mining operations with effect from March 16, 2018 until fresh mining leases (not fresh renewals or other renewals) in accordance with the provisions of the MMDR Act, 1957 and fresh environmental clearances are granted.

Some mining lessees and other mining stakeholder have filed applications in the pending Abolition Act matter for resumption of mining in the State. The Central Government has also filed an early hearing application in the long pending abolition matter.

Copper Division

Copper division of Vedanta Limited has received an order from Tamil Nadu Pollution Control Board (TNPCB) on April 9, 2018 whereby they have rejected the Company's application for renewal of Consent to Operate (CTO) for the 400,000 Metric Tonnes Per Annum (MTPA) Copper Smelter plant in Tuticorin.

In furtherance to the order of TNPCB rejecting the Company's application, the Company decided to shut its Copper smelting operations at Tuticorin and has filed an appeal with TNPCB Appellate authority against the order. During the pendency of the appeal the TNPCB vide its order dated May 23, 2018 ordered disconnection of electricity supply and closure of the Company's Copper Smelter plant. Post this the Government of Tamil Nadu on May 28, 2018 ordered the permanent closure of the plant. The Company challenged the same in the National Green Tribunal which passed a favourable order for reopening of the plant. The order was appealed by the TNPCB and the State of Tamil Nadu in the Supreme Court.

The Supreme Court passed an order upholding the appeal and directing the Company to approach the Madras High Court for relief. The Company has filed a writ petition in the Madras High Court that is currently pending adjudication.

In a separate proceeding, the Madurai Bench of the Madras High Court in a PIL filed against the Company, has stated that the application for renewal for Environmental Clearance for Copper Smelter Plant 2 project, shall be processed after conduct of mandatory public hearing and the application shall be decided by the competent authority on or before September 23, 2018. In the interim, the High Court ordered us to cease construction and all other activities on site for the proposed expansion project with immediate effect. Separately, SIPCOT through its letter dated May 29, 2018, cancelled 342.22 acres of the land allotted to us for the proposed expansion project. The Company challenged the same in the High Court which passed an interim stay on the withdrawal of land allotment.

SECRETARIAL STANDARDS

The Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Companies Secretaries of India.

ANNUAL RETURN

An extract of the Annual Return in prescribed form MGT-9 is annexed hereto as Rs. Annexure C' to the Directors' Report.

BUSINESS RESPONSIBILITY REPORT & SUSTAINABILITY REPORT

In pursuance of our commitment to responsible business and in compliance with Listing Regulations, a Business Responsibility Report ("BRR") which describes the initiatives taken by the Company from an environmental, social and governance perspective forms part of this Annual Report.

Our strategy continues to focus on delivering long-term value and growth to our shareholders through diversified portfolio of large, long life and low-cost assets. At Vedanta, we understand the value of a unified sustainable development agenda that goes beyond compliance.

We manage our business in a sustainable manner, ensuring we have effective and appropriate business processes and behaviours in place, focussing on health and safety management and responsibly managing our environmental impacts and preserving biodiversity. We aim to create a culture based on our values which ensures the professional growth and personal well-being of our entire workforce.

Your Company also publishes the Sustainability Report annually which is based on Global Reporting Initiatives (GRI) Standards. The Sustainability report is available on the website of the Company at www.vedantalimited.com

AWARDS AND ACCOLADES

Your Company has been winning accolades for its unique innovations and contributions to the stakeholders & society. Such recognitions are a testimony to the growth, emphasis on being a safe operator and commitment towards delivering value to our people, investors and stakeholders.

During the year, we won multiple awards and recognition.

The details of the same are provided in separate section in the Annual Report.

MATERIAL CHANGES & COMMITMENT AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of the Company subsequent to the close of the financial year till the date of this Report.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption stipulated under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as Rs. Annexure E'.

The details of the Foreign Exchange Earnings and Outgo are as follows:

Description Year Ended March 31, 2019 Year Ended

March 31,2018

Expenditure in foreign currency 3,459 1,551
Earnings in foreign currency 18,596 28,394
CIF Value of Imports 18,633 28,900

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors hereby confirms that:-

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed and there is no material departures from the same;

(b) they 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 at the end of the financial year, i.e. March 31,2019 and of the profit and loss of the Company for that period;

(c) 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 Company's assets and for preventing and detecting fraud and other irregularities;

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

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

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

ACKNOWLEDGEMENT

Your Board takes this opportunity to convey their sincere appreciation to all employees for their dedicated services, firm commitment and collective contribution to the goals, mission and vision of the Company.

We would also like to express our sincere gratitude to all our stakeholders for their endless faith in their Company.

The Directors further take this opportunity to acknowledge the support and assistance extended to us by the Government, Bankers, Stock Exchanges, Financial Institutions and Communities, Shareholders and Investors.

Together, we will continue to benefit from, and contribute to, one of the fastest-growing economies in the world and add value for our shareholders.

We look forward to delivering another year of value adding growth.

For and on behalf of the Board of Directors
Place: Mumbai Navin Agarwal
Dated: May 7, 2019 Executive Chairman