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ISGEC Heavy Engineering Ltd.

BSE: 533033 Sector: Engineering
NSE: ISGEC ISIN Code: INE858B01029
BSE 00:00 | 24 Sep 746.00 -3.70






NSE 00:00 | 24 Sep 746.45 -3.75






OPEN 759.15
52-Week high 877.00
52-Week low 231.10
P/E 27.04
Mkt Cap.(Rs cr) 5,483
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 759.15
CLOSE 749.70
52-Week high 877.00
52-Week low 231.10
P/E 27.04
Mkt Cap.(Rs cr) 5,483
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

ISGEC Heavy Engineering Ltd. (ISGEC) - Director Report

Company director report

1.00 The Board hereby presents its Report for the year ended 31st March2021.


(Rs in lakhs)

Particulars As at 31.03.2021 As at 31.03.2020
Fixed Assets 49124.73 52626.31
Other Non-Current Assets 39909.98 31898.18
Current Assets 389696.74 358803.45
Total 478731.45 443327.94
II. EQUITY AND LIABILITIES: Shareholders' Funds 167458.72 147050.92
Non-Current Liabilities 37419.88 24891.01
Current Liabilities 273852.85 271386.01
Total 478731.45 443327.94
Particulars For the year ended 31.03.2021 For the year ended 31.03.2020
III. Revenue From Operations 430960.60 489370.87
Other Income 3560.96 1858.09
Total Revenue 434521.56 491228.96
IV. Total Expenses 406067.86 470482.39
V. Profit/(Loss) Before Tax 28453.70 20746.57
VI. Tax Expenses including Deferred Tax 6630.69 5437.05
VII. Profit/(Loss) After Tax 21823.01 15309.52
VIII. Other Comprehensive Income/(Expense) 55.38 27.50
IX. Balance carried to Profit and Loss Account 21878.39 15337.02
X. Basic/ Diluted Earnings per Share of Rs 1/- each (in ') 29.68 20.82


3.01 In the month of February 2021 the Company declared an Interim Dividend of Rs 2/-per equity share of Rs 1 /- each which has been disbursed. Your Directors are pleased torecommend a Final Dividend of Rs 1/- per equity share of Rs 1/- each. Total Dividend(inclusive of the interim and final dividend) will be Rs 3/- per equity share of Rs 1/-each for the year ended March 31 2021. The Final Dividend if approved and declared inthe forthcoming Annual General Meeting will result in a total outflow of Rs 735.29 lakh.


4.01 As stated in last year's Board Report the business of the Company was affecteddue to lockdown from the last week of March 2020 till May 2020.

4.02 After the lockdown was lifted the overall demand trends were encouraging. Manynew orders were booked from sectors such as Railways Power (Boilers Air PollutionControl Waste to Energy) Water Process Industry Construction Fertilizer CementRefinery Steel Sugar Ethanol Plant Chemicals Food Oil & Gas RenewablesAutomotive Aeronautics Refractory Mining Soda Ash Paper and Tool & Die. Orderbooking during the year was 27% higher than the order booking in the preceding year.

4.03 The Revenue and Profits are Rs 4345 crore and Rs 218 crore respectively ascompared to Rs 4912 crore and Rs 153 crore respectively in the preceding year.

4.04 There is a shortfall in revenue as a result of the lockdowns.

4.05 In spite of a lower turnover profitability is higher due to savings in variouscosts i.e. legal expenses employee costs travel expenses as well as increasedefficiency including the use of technological solutions.


4.06 In last year's Board Report details were stated of the adverse effects of theCovid-19 pandemic on the businesses of the Company and measures taken by the Company tominimize the risks. The steps included employees working from home strengthening of theIT system sending communication to customers with reference to force majeure improvementin activities to save costs such as value engineering review of designs standardizationof equipment and training through webinars.

4.07 Even after lifting of the lockdown the Company continues to comply with socialdistancing norms and other health and safety measures in all the factories and offices. Inorder to ensure social distancing some of the employees continued to work from home.

4.08 As a safeguard regular diagnostic tests were conducted across all locations.Vaccination drives for employees and their spouses as per guidelines of the Governmenthave also been organized. It was ensured that no employee was denied hospital treatmentbecause of financial constraints.

4.09 In addition the Company has taken a Life Term Insurance Policy for all theemployees. Under the Policy in case of death of an employee the nominee is paid 36months' Basic Salary plus DA.

4.10 During the year under report the working and operations which were affected tillthe second quarter of the year normalized to a large extent from the third quarter.Factories were running with almost full capacity utilization. Attendance in offices alsostarted getting normal. Site operations progressively became satisfactory and there was nomajor labour crisis at sites.

4.11 As stated in last year's Board Report in the wake of the Covid-19 pandemicrelated disruptions the Company had imposed a salary cut for all the employees drawing anannual compensation above Rs 8 lakhs. During the year salaries were progressivelyrestored.

4.12 With the onslaught of the second wave of Covid-19 since the last few monthsworking has again been adversely affected. Factories were running normally until the thirdweek of April 2021 and in spite of there being a few Covid positive cases there was noshortage of labour. However there was a shortfall in production because ofnon-availability of oxygen and argon gas. The availability of oxygen and argon hasnormalized from 1st June 2021.

4.13 As regards the EPC business which has offices in Pune Noida and Chennai thesewere closed for 4 to 6 weeks in April and May 2021. During this period all employeesstarted working from home. Productivity was adversely affected due to this and alsobecause many employees and members of their families tested Covid positive.

4.14 All project sites were operational but considering the fear and panic all aroundretention of existing manpower of contractors became a challenge. Some difficulties werealso experienced in resource mobilization such as tying up with testing agencies andprocuring tools and cranes. Supervision of erection and commissioning was also adverselyaffected due to some of the engineers being Covid positive. The working at project sitesis improving with the gradual return of migrant labour.

4.15 The situation both in the factories as well as in the offices has also startedimproving in June 2021. To ensure continued social distancing the offices in Pune Noidaand Chennai have started with attendance ranging from 20% to 40% on a rotational basis.The employees not coming to office are working from home.

4.16 Our vendors too faced a lot of difficulty. Lockdowns across many states scarcityof manpower as well as shortage of oxygen supply adversely impacted their working.However normalcy is returning now.

4.17 All travel has been suspended barring in exceptional circumstances.

4.18 We continue to closely monitor the economic developments and repercussions relatedto Covid-19 and their implications on the Company. Though the future impact of thepandemic on our business cannot be reliably predicted at this time we are hopeful thatlearnings from our experience of last year will be very useful and we will be able to tideover the situation. Billing and revenue will however be adversely affected in thequarter ending 30th June 2021.

4.19 As for the current year order booking continues to be satisfactory both in theEngineering Procurement and Construction (EPC) Segment as well as the ManufacturingSegment. As stated above working during the first quarter ending 30th June2021 has been affected due to the second wave of Covid. With the improvement in thesituation things may balance out in subsequent quarters.

4.20 Apart from Covid-19 margins continue to be adversely affected due to steepincrease in commodity (steel copper aluminum and nickel) prices. About 45% of ourorders in hand (PSU customers) have a steel price variation clause and the price increasecan be passed on to these customers. For the rest of the orders contingency margin kepton cost may not be enough to cover the increase. Steps are being taken to analyze andminimize the effect.


(i) We have added to our repertoire of Air Pollution Control Technologies by signing aLicensing Agreement with BHIFW USA for TLN Technology which would enable theimplementation of Combustion System Modifications in Tangential Fired Utility Boilersfiring coal in Thermal Power Plants to reduce NOx emission as per Environment Regulationsin India. Our executives have undergone training with BHIFW to understand and implementthe technology.

(ii) Our own technologists and engineers continue to make several innovations.

(iii) We have developed innovative know-how for SO2 emission reduction from CaptivePower Plants in Steel Mills using Coal Fired Utility Boiler through parallel operation ofa Blast Furnace Gas Fired Boiler with Coal Fired Boiler to feed steam to a single turbinefor Power Generation.

(iv) We received a Patent for a Self-Sharpening Shredder Hammer Tip as well as aDesign Registration for Leak Proof Economical Valve with Taper Wedge Safety Lock for ourSugar Plants & Machinery business.

(v) We have developed and commissioned a Pan Station for White Plantation Sugar Plantwhere all Pans are of Vertical Continuous type and have an in-built Graining Pan. Thispositively impacts the efficiency of the plant. We have also developed a number ofequipment for Sugar Plants through in-house design which include Horizontal ContinuousPan Fibrizer Sand Catcher and Induction Hardened Crown Pinions. All these help inimproving the working of the mills reducing energy consumption and improving sugarquality.

(vi) We have acquired technology for manufacturing 250 & 500 Litres per Minute(LPM) Medical Oxygen Plants (original technology from DRDO).

(vii) The company has also invested in new software in order to improve efficiency ofproducts and to enable remote working.


4.22 The export revenue during the year was lower at Rs 645 crore against Rs 1170crore in the preceding year. This was because some of the projects for which orders werereceived did not become effective as the clients and their lenders were forced to revisitor delay the project due to Covid-19.

4.23 Export order booking was also lower as there was no international travel by ourexport team or by our prospective clients to India for the entire financial year. Alsoscheduled exhibitions were either postponed or suspended.

4.24 In spite of these limitations focus on export marketing continued during the yearthrough the use of electronic media and online marketing. Videos and emails were sent toprospective customers and virtual meetings and webinars were held.

4.25 The enquiry position as on date is good. Foreign economies are beginning to openup and export orders have started trickling in.


4.26 Our efforts to make in-roads into the Defence sector continued and the Company gotapproved by the Goa Shipyard Ltd. for a major equipment required by the Indian Navy i.e.Ship Damage Control Simulator. Only two companies in India are qualified for thisequipment.

4.27 During the year we made headway with one of the major multinational defenceequipment manufacturers and have received an enquiry from them pertaining to a navalequipment. More enquiries are expected pertaining to artillery from the same manufacturer.

4.28 Major disruptions are expected on the Energy Sector front. Significant ones beingreduction in crude import bill increased dependence on domestically produced Methanol forvarious downstream chemicals and focus on net zero mission of the developed world.Considering these trends we have identified futuristic areas related to renewables greenenergy and petrochemicals & chemicals for diversification and shortlisted some newproducts for discussions with technology licensors.


4.29 EPC Segment covers the setting up of Projects for Boilers Air Pollution ControlEquipment including Flue Gas Desulfurization (FGD) Systems Sugar Plants & MachineryDistilleries for Ethanol Power Plants Construction of Factories Material HandlingSystems Industrial Wastewater Treatment & Recycling and Civil Infrastructure.

4.30 Both turnover and profit were only marginally less as compared to the precedingyear. However profitability improved as a result of various steps taken to reduce costsand improve productivity.

4.31 During the year after an initial setback due to Covid-19 the Company bagged goodorders from Cement Refinery Steel Distillery Chemicals Sugar Food Oil & GasRailways Air Pollution Control Power and Renewable Energy sectors.

4.32 We also ventured into a new field of providing remotely managed e-Services forPlant Operation Maintenance Troubleshooting and Commissioning.

4.33 We successfully executed a project involving Combustion Modification on a 150 MWTangentially Fired Boiler ! unit at an Aluminum Plant to reduce Nitrogen Oxide emissionsfrom the Boiler.

4.34 We successfully commissioned a stand-alone Sugar Refinery of 2500 Tonnes per Day(TPD) for a company in the Kingdom of Saudi Arabia. This is one of the largest istand-alone sugar refineries in the world.

4.35 We also set up 2 x 600 TPD Sugar Refinery projects in Uttar Pradesh.

4.36 Another project completed was a 3500 TCD (Tonnes of Cane per Day) Refined SugarPlant with 18 MW Co- generation project in Haryana.

4.37 The subvention scheme for interest on loans for Distilleries to make Ethanol hasresulted in there being

a number of enquiries in hand that we are hopeful of i converting into orders.

4.38 As a result of an infra push by the Government the Construction businesscontinued to do well. We i successfully constructed a Workshop for periodic overhauling ofRail Wagons at Bikaner.

4.39 We set up a 20 MW Coke Oven Waste Heat based Power i Plant at Koppal Karnataka.

4.40 A Coal & Limestone Handling Package for a 70 MW Co-generation Power Plant wasset up at Bhavnagar Gujarat.


(i) Having booked some orders recently we have reached the landmark of booking ordersfor a 100 CFBC Boilers.

(ii) Order for the largest Cement Waste Heat Recovery Boiler.

(iii) Large value order for Operation and Maintenance from a reputed industrial housefor their Boiler.

(iv) Three more orders for Wet Flue Gas Desulfurization (WFGD) System projects.

(v) An order from a Power Plant for Renovation & Modernization (R&M) of 8Electrostatic Precipitators of larger size Boilers. The purpose of this R&M is toreduce particulate matter emissions in ESPs to meet current emission norms as per theEnvironmental Policy.

(vi) An order for a Turnkey Sugar Plant of 10000 TCD in Karnataka one of the largestgreenfield plants in the sugar industry in India.

(vii) An order for a 3500 TCD Sugar Plant to be set up on a turnkey basis inMaharashtra.

(viii) Our first order for a Raw Water Treatment project from NTPC namely - Ganga WaterTreatment for Barauni Thermal Power Plant.

(ix) Our first Process Plant order on EPC basis for a 200 TPD Formaldehyde Plant fromAssam Petrochemicals.

(x) Orders for a 600 TPD Municipal Waste-based Power Plant and Metro Repair andMaintenance Facilities for Kolkata Metro and Bengaluru Metro.


4.42 The Segment covers the manufacture of Presses Process Equipment Liquified GasContainers Tubing & Piping Iron & Steel Castings and Industrial Machinery.

4.43 The revenue of the segment was marginally lower but profit was substantiallyhigher than the preceding year due to various measures mentioned in 4.05 above.

4.44 During the year after the initial setback due to Covid-19 the company baggedgood orders from Power Refinery Hydro and Steam Power Steel Cement AeronauticsRefractory Soda Ash and Tool & Die sectors.

4.45 With the impact of Covid-19 being felt all over the world there was a significantdecline in automobile sales. Consequently demand from the Automotive sector the majorusers for Mechanical Presses remained depressed and adversely affected our order booking.Fortunately our focus on Hydraulic Presses enabled us to book orders for HydraulicPresses from the NonAutomotive sectors. This mitigated the loss of orders from theAutomotive sector to some extent.

4.46 As for exports of Presses our South East Asia office remained inoperative untilDecember 2020 and in most of the European countries there was extended lockdown resultingin low demand.

4.47 Lockdowns restricted visits that were necessary for generating enquiries and forpost-offer discussions. We lost important orders from Europe and North America due tothese limitations.

4.48 As for the current year uncertainty continues in the domestic market due to thesecond wave of Covid-19. Although we foresee some signs of improvement in the Automotivemarket it will take some more time to revive. We will continue to focus on marketing highproductivity and high technology products like Servo Presses Transfer Presses andProgressive Die Presses.

4.49 We hope to retain our market share in specialized Hydraulic Presses such as DieSpotting Presses Cold Forging Presses Refractory Presses and Specialized Presses forthe Defence and Railway sectors.

4.50 In the Process Equipment business majority of the projects in the Oil Refineryand Petrochemicals sectors were either shelved or deferred adversely affecting orderbooking. However a good backlog of orders from the previous year has kept our shops verybusy. The situation has improved and recently we have booked three high value orders forShell & Tube Heat Exchangers. The market for Process Equipment is likely to remainbuoyant during the year.

4.51 We also continue to pursue opportunities in Repair & Maintenance of CriticalEquipment in Process Plants.

4.52 For our Liquified Gas Containers business it was a very good year. But recentlythere has been a slowdown in the last few months as a result of the lockdown. The sharpdip in demand for Caustic Soda from the Alumina and Textile industries due to theextended lockdown has directly affected our order booking.

4.53 This was a good year for Tubing and Piping products.

4.54 The Tubing and Piping Shops have received a Certification for EN Code (EuropeanCode) for Boilers as well as an approval to manufacture Pressure Parts as per ISO-12952and ISO-3834. Also the special capability for Inconel Weld Overlay process developed byus has enabled us to bid for prestigious orders for Waste-to-Energy Boiler fabricationfrom the developed world. The current year has started with a record order book requiringus to make some small investments to marginally increase our manufacturing capacity.

4.55 In spite of deferment of Greenfield Soda Ash projects due to Covid-19 the IronCastings business was able to maintain its turnover and profit as per last year's levels.

4.56 Majority of Original Equipment Manufacturers (OEMs) in the Tool & Die sectorhave started their Tool Room (manufacturing facility) in India. In view of high demandenvisaged for Castings from this sector we are expanding our Foundry facility which willincrease output by 50%. The new facility is expected to be operational from January 2022.

4.57 We expect good business both from the domestic as well as the export markets.

4.58 The working of Steel Castings business during the year improved but we areworking towards increasing its efficiency even further.

4.59 The market for Steel Castings continued to remain depressed during the year. Wedid win a few orders under acute competition but margins were hit.

4.60 Lately the market for Steel Castings has improved and the Unit has booked goodorders. However this foundry has been impacted to a great extent due to non-availabilityof oxygen. The situation has however improved as oxygen is available since 1stJune 2021.

4.61 SIGNIFICANT NEW ORDERS RECEIVED (Manufacturing Segment):

(i) Important orders for the Presses business from the manufacturers of RailwayEquipment and Refractories in the Non-Automotive sector.

(ii) Order for a Hydraulic Press for Aerospace application.

(iii) Another order for a Mechanical Press from an existing customer in Spain.

iv) Breakthrough order for High Wall Mining Parts from the Mining sector for ourContract Manufacturing business.

(v) Export orders for Process Equipment - Surface Condenser and Deaerator for the Powersector and Heat Exchanger for the Refinery sector. Few large value orders were alsoreceived from domestic Refinery projects.

(vi) First order for the fabrication of Cooling Stack for a Steel Plant for Tubing& Piping business.


Details of significant changes in key Financial Ratios is i enclosed as Annexure-1.



The financial results for the year under report were very good. The profit before taxwas Rs 87.95 crores against Rs 33.36 crores in the preceding year.

Sugar Scenario:

(1) There was a steep reduction in the all India closing stock of sugar at the end oflast season on 30th September 2020. Closing stock as on 30thSeptember 2021 is likely to reduce further in spite of higher all India sugar productionin the current season. Comparative figures are given below:

Season Opening Stock Lakh MT Production Lakh/Ton Total Availability Lakh MT Domestic Consumption Lakh MT Exports Lakh MT Total Lakh MT Closing Stock Lakh MT
2018-19 107.16 331.62 438.78 255.00 38.00 293.00 145.78
2019-20 145.79 274.11 419.90 253.00 59.00 312.00 107.90
2020-21* 107.40 302.00 409.40 260.00 60.00 320.00 89.40

*As per estimate of Indian Sugar Mills Association.

(2) The reduction in closing stock in spite of static domestic consumption has beendue to the following steps taken by the Central Government i for the last few seasons: -

(i) Continuing the Scheme of Maximum Admissible Export Quota (MAEQ) which providessubsidy to cover loss on export of sugar. This enabled i the export of 60 lakh tonnes inthe preceding season. Same quantity is likely to be exported in the current season.

(ii) Incentivizing more ethanol production by diverting B-heavy molasses and sugarcanejuice from production of sugar to ethanol. While approximately 10 lakh tonnes of sugar wasdiverted during the season 2019-20 in favour of ethanol production 20 lakh tonnes ofsugar is expected to be diverted during the current season 2020-21.

(3) The Central Government continued with the policy of Monthly Release Mechanism underwhich each Mill is not allowed to sell more than the released quantity for that month.

(4) The Central Government also continued with the policy of Minimum Sale Price (MSP)below which sugar mills are not allowed to sell. MSP applicable during the year underreport was Rs 3100/- per quintal and no increase was made despite repeated representationsby the Industry and also recommendations by the Commission for Agricultural Costs andPrices (CACP) and Niti Aayog.

(5) Demand for sugar due to lockdown in the months of April and May 2020 was low andthe off take was less. It increased to some extent after the lockdown restrictions wereeased. Demand of sugar was also affected due to higher consumption of Gur as there ispublic perception that its consumption is better to control Covid-19 relatedcomplications. Sugar prices therefore continued at last year's level.

(6) Due to resurgence of Covid-19 the demand has decreased since last month and sugarprices are under pressure. Factory Working:

(7) The working of the factory during the season 2020-21 was very good. Stoppages wereminimum.

(8) The recovery during the season however was lower at 11.49% against 11.79% in thepreceding season due to climatic reasons.

(9) In spite of about 7-8% reduction in the yield of sugarcane we were able to crush16.16 lakh MT of cane against 16.40 lakh MT in the preceding season.

(10) In spite of the resurgence of Covid-19 from March 2021 operations of the factorywere smooth.

(11) The Central Government increased the Fair & Remunerative Price (FRP) ofsugarcane by Rs 10/- per quintal to Rs 285/- per quintal linked to

(13) The statistical position is given below: -

a recovery of 10%. FRP applicable to each factory is to be increased by Rs 2.85 perquintal for every 0.1% increase in the recovery over 10%. FRP applicable to our factorywas Rs 336/- per quintal.

(12) The Haryana Government also increased the State Advised Price (SAP) by Rs 10/- perquintal from Rs 340/- per quintal to Rs 350/- per quintal which is the highest in thecountry. The Haryana Government continued to give a subsidy to compensate for thedifference between SAP & FRP. The amount of subsidy received by us was however lessdue to higher FRP.


Sugar Season(October to September)

Saraswati Sugar Mills (SSM) 2020-21 2019-20
Date of Start of crushing operations by SSM 24-11-2020 26.11.2019
Date of Close of crushing operations by SSM 10-05-2021 16.05.2020
Cane Crushed by SSM (Lakh Tonnes) 16.16 16.40
Recovery(%) 11.49% 11.79%
Sugar Production of SSM (Lakh Tonnes) 1.86 1.93
All India

Sugar Season (October to September)

Production of Sugar (Lakh Tonnes) 302* 274.11
Consumption of Sugar (Lakh Tonnes) 260* 253.00

*These are estimated as the sugar season is yet to close.

(14) Under MAEQ your Company was allotted a quantity of 368660 quintal of sugar forexport. The entire quantity has been contracted and 364000 quintals have already beendispatched.

100 KLPD Ethanol Plant:

(15) As already mentioned in last year's report we had started work on setting up anEthanol Plant of 100 KLPD in the last season. 90% of the work has been completed. It wasexpected to start commercial production by June 2021 but may get delayed due to theresurgence of Covid-19.

(16) With the start of the Ethanol Plant there will be increased requirement ofworking capital and the Company shall be taking necessary steps to enhance the Cash Creditlimits.

Credit Rating for enhanced Working Capital facilities and Term Loan:

(17) The Company had got its Working Capital loan facilities from Banks enhanced.Credit rating Agency ICRA has reaffirmed the Credit rating of

"A-" for our fund based working capital facilities and Term loan facilitiesand "A1" for Non-fund based credit facilities.

Next Season:

(18) Due to expected increase in cane planting we expect to crush more cane duringnext year.

(19) Though the all India closing stock of sugar at the end of the season 2020-21 islower than the closing stock at the end of the preceding season but still it will beequal to four months' domestic consumption. Unless the Central Government continues withthe policy of MAEQ with adequate subsidy the sugar prices are not likely to increase.


(1) As reported in last year's Board Report due to the nation-wide lockdown initiatedin the last week of March 2020 some of the equipment which were ready or in the finalstages could not be dispatched. These were dispatched during the year underreport.Accordingly the total revenue during the year under report was Rs 339.03 crores ascompared to Rs 288.92 crores in the preceding year.

(2) Profit before tax was Rs 9.66 crores as compared to Rs 11.15 crores in thepreceding year. It would have been higher but the Company had to incur about Rs 3 crores(approx. USD 400000) on account of detention of ship arranged by Samsung fortransportation of Columns from Mumbai to Thailand. The reason for the detention was theinability to get the barge to sail out from the jetty at Dahej due to lack of sufficientwater between the jetty and the channel at high tide. The next tide was after 13 days.Thereafter as a corrective measure we carried out dredging between the jetty and thechannel to increase the depth.

(3) Important supplies made during the year were: -

a) Six Vanadium Reactors to Exxon Mobil for their plant in Belgium which was our firstever overseas dispatch of a Hydro Processing Reactor.

b) Four large Columns including a Crude Column a Vacuum Column and a ProductFractionator supplied to PSS Netherlands (a consortium of Petrofac-UAE Saipem-Italy andSamsung- Korea) for the Thai Oil Refinery project. This was the biggest value singlecontract executed by us for export & the largest Columns manufactured by us so far.

c) Vanadium Reactor for the DHDT Unit of the Rajasthan Refinery project India.

(4) During the year we continued with the business of undertaking on-site repairs ofequipment in Fertilizer and Petrochemical plants during their shutdowns.

(5) In our attempt to extend our presence in the petrochemical sector we weresuccessful in obtaining an approval from INEOS (erstwhile BP) for the manufacture of PTAplant equipment. Attempts to qualify for more complicated equipment are in progress.

(6) We booked our first order for supply of a complete Steam Surface Condenser for aSuper Critical Power Plant in Bangladesh.

(7) The order booking during the year under report has not been good due to defermentof several projects. Subject to uncertainties posed by Covid

we expect good order booking during the current year as most of the projects deferredare expected to become active.


(1) The Company continues to do well. The total income and the profits were higher ascompared with the preceding year. Total income was Rs 36.42 crores as against Rs 25.60crores last year and profits before tax was Rs 5.99 crores against Rs 2.47 crores lastyear.

(2) Major business potential for our Company is from chemical plants mainly among thembeing Agro chemicals Pharmaceuticals including API (Active Pharmaceutical Ingredients)as well as essential commodities such as common salt. These plants did not suffer majorslowdown post lockdown period and therefore the impact on our order booking was minimalduring the year.

(3) The orders under execution however were affected due to delay in the raw materialsupply. Most of the projects were delivered on time except one project where LD ispayable.

(4) Orders booked included orders for the first time for a large Titanium Clad ColumnTantalum Bayonet Exchanger and Niobium Exchangers. Other major orders booked for exportwere for Hastelloy Exchanger and domestic order for Critical Monel Reactor.

(5) Barring the uncertainties posed by Covid-19 the Company is likely to do well nextyear due to a record order backlog and major projects in Soda Ash / ChlorineDerivatives/Acid Plant Sectors.


(1) The Company is a design company to manage detailed engineering of Boilers globallycontracted by Sumitomo SHI FW (SFW) Finland. The total income and profit was higherduring the year at Rs 9.83 crores and Rs 2.07 crores respectively as compared with Rs 6.49crores and Rs 0.37 crores respectively in the previous year.

(2) Due to delay in materialization of a few anticipated projects the Company decidedto defer its hiring plan but instead developed its subcontractors to perform engineeringfor Piping Steel and Electrical & Instrumentation to meet the project schedule forconfirmed orders. The Company effectively trained and supervised the work output of thesesubcontractors.

(3) Further the Company utilised the design capability gained during the previousyears enabling it to perform more complex engineering work than it had done previously.

(4) Due to various measures taken by the Company to utilise in-house capacity andcapability the capacity utilisation was higher in the year under report as compared withlast year.

(5) As for the next year the order book for the Company looks promising as it isassured of two new projects in addition to the backlog projects and a couple of moreprojects are likely to materialize.


(1) The Company has been able to establish itself in the market by offering Bag Filtersfor Boiler applications Cement plants DE (Dust Emission) Systems for Steel Plants andDry Scrubbing Systems for Sulphur Oxides (SOx) removal.

(2) Due to the Covid -19 situation Dry Scrubbing projects (NSPCIL and Detox) were puton hold and there was delay in finalization of new orders. The turnover as well as orderbooking during the year under report were inadequate. The total income was Rs 26.25crores against Rs 40.45 crores last year.

Consequently there was a loss of Rs 3.87 crores during the year against profit of Rs0.46 crores last year.

(3) Having faced many teething problems in the Bag Filters supplied there have beenlearnings which are being applied in future projects.

(4) In addition to normal Bag filters it has been decided in consultation withRedecam Italy JV partner of the company to participate in projects requiring solutionssuch as Dry Scrubbing Systems / Flue Gas Cleaning Systems for removal of SOx and otherheavy chemicals. These are likely to have more demand specifically in MSW (MunicipalSolid Waste) based plants and Process Industries due to major impetus on reducing the loadon landfills and also to meet stringent SOx emission norms.


(1) Operations in Eagle Press continued to be affected due to slowdown in Canada andUSA due to Covid-19 during the year under report. The revenue was therefore less. Thesubsidiary company had a loss during the year.

(2) The loss was mainly on account of an expense to settle an outstanding arbitrationon account of performance issue of the Presses supplied by Eagle before it was taken overby Isgec.

(3) In order to utilize the manufacturing resources it was decided to build a Press instock to be sold against future orders.

(4) Situation has now improved. The Company with the opening of the economy in USAhas been able to book a large number of orders and FY 22 is likely to be good.


(i) Free Look Software Private Limited and Isgec Export Limited:

There was no commercial activity during the year.

(ii) Isgec Engineering & Projects Limited:

There was no commercial activity during the year except letting out of property atKasauli.

(iii) Isgec Covema Limited:

The company had orders for supply of Boiler parts and for Erection and Commissioning ofBoilers. These orders were majorly executed in FY 21. Balance will be executed in FY 22.


6.01 No amount was transferred to the Reserves during the year ended 31stMarch 2021.


7.01 Four Board Meetings were held during the year ended 31st March 2021.


8.01 Your Directors hereby confirm that:

(a) In the preparation of the Annual Accounts for the Financial Year 2020-21 theapplicable Accounting Standards have been followed and there are no material departures;

(b) The Directors have selected such accounting policies with the concurrence of theStatutory Auditors and applied them consistently and made judgments and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany at the end of the financial year and of the profit of the Company for thefinancial year;

(c) The Directors have taken proper and sufficient care to the best of their knowledgeand ability for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act 2013. They confirm that there are adequate systems andcontrols for safeguarding the assets of the Company and for preventing and detecting fraudand other irregularities;

(d) The Directors have prepared the Annual Accounts on a going concern basis;

(e) The Directors have laid down internal financial controls to be followed by theCompany and these financial controls are adequate and are operating effectively; and

(f) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.


9.01 All the Independent Directors have furnished declarations that each of them meetsthe criteria of independence as provided in Sub-section (6) of Section 149 of theCompanies Act 2013 and Rule 6 (1) and (2) of the Companies (Appointment and Qualificationof Directors) fifth Amendment Rules 2019.


10.01 The Nomination and Remuneration Committee formulated the criteria for determiningqualifications positive attributes and independence of a Director and recommended to theBoard a policy relating to the remuneration for the key managerial personnel and otheremployees. While formulating the policy the Committee has taken into account:-

(i) that the level and composition of remuneration is reasonable and sufficient toattract retain and motivate Directors of the quality required to run the Companysuccessfully;

(ii) that relationship of remuneration to performance is clear and meets appropriateperformance benchmarks; and

(iii) that remuneration to Directors key managerial personnel and senior managementinvolves a balance between fixed and incentive pay reflecting short and long termperformance objectives appropriate to the working of the Company and its goals.

The Nomination and Remuneration Policy is available on the website of the company athttp://www.isgec. com/pdf/NRC-policy.pdf


11.01 There is no qualification reservation or adverse remark or disclaimer made bythe Statutory Auditors in the Auditors' Report or by the Company Secretary in Practice inSecretarial Audit Report needing explanation or comments by the Board.

11.02 The Statutory Auditors have not reported any incident of fraud to the AuditCommittee of the Company in the year under review.


12.01 Particulars of Loans given Investments made or Securities provided underSection 186 of the Companies Act are annexed as Annexure-2.


13.01 The Company has formulated a Policy on Materiality of Related Party Transactionsand also on dealing with Related Party Transactions as required under SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The Policy on Related PartyTransactions has been disclosed on the website of the company at on Materiality of Related Party Transactions and onDealingwithRelatedPartyTransactions1822020.pdf

13.02 All Contracts Arrangements and Transactions entered by the Company during thefinancial year with Related Parties were in its ordinary course of business and were onarm's length basis.

13.03 The particulars of contracts or arrangements with Related Parties referred to inSection 188(1) of the Companies Act 2013 are given in the prescribed Form AOC-2 annexedas Annexure-3.


14.01 There have been no material changes and commitments if any affecting thefinancial position of the Company which have occurred between the end of the financialyear of the Company to which the financial statements relate and the date of the report.


15.01 The required information regarding Conservation of Energy Technology Absorptionand Foreign Exchange Earnings and Outgo is annexed hereto as Annexure-4.


16.01 The Board has developed and implemented a Risk Management Policy for the Companyincluding for identifying elements of risk which in the opinion of the Board may threatenthe existence of the Company. In terms of the Policy a detailed risk review is done byUnit Level Committee or Corporate Level Committee (depending upon the value of the order)before accepting any order. All the terms and conditions both financial and technicalare reviewed.

16.02 In addition the Board has laid down a Foreign Exchange Risk Management Policywhich is implemented for hedging Forex risk.

16.03 The Company also takes adequate insurance to protect its assets.


17.01 The Company has a Corporate Social Responsibility Committee of the Board ofDirectors as under:-

- For the period from April 01 2020 till the conclusion of the 87th AGM ofthe Company held on September 18 2020:

S. No. Name of the Committee Member Position
1. Mr. RanjitPuri (DIN: 00052459) Chairman
2. Mr. Aditya Puri (DIN: 00052534) Member
3. Mr. Vinod Kumar (DIN: 00454458)) Sachdeva Member

- For the period from the conclusion of the 87th AGM of the Company held onSeptember 18 2020 till March 31 2021:

S. No. Name of the Committee Member Position

1. Mr. Ranjit Puri (DIN:00052459) Chairman

2. Mr. Aditya Puri (DIN:00052534) Member

3. Mr. Vishal (DIN: 00164204) Kirti Keshav Marwaha Member

17.02 In addition to the amount of Rs 16.15 lakhs pertaining to the previous year theCompany was required to spend a further amount of Rs 391.39 lakhs for the year ended 31stMarch 2021 i.e. an aggregate amount of Rs 407.54 lakhs.

17.03 The Company has allocated an amount of Rs 225 lakhs to be spent on Multi-yearOngoing Projects for installing Water Harvesting Systems and Solar Power Systems in thelocal areas including rural areas around Yamunanagar for ensuring environmentalsustainability and conservation of natural resources and maintaining the quality of soilair and water. The Company has spent Rs 123.88 lakh on ongoing projects in the currentfinancial year and the balance amount of Rs 101.12 lakhs transferred to Unspent CSRAccount.

17.04 The Company has spent further Rs 182.54 lakhs on Social Projects other thanongoing projects including Rs 19.56 lakhs on administrative overheads during the financialyear.

17.05 The annual report on Corporate Social Responsibility is given in the prescribedformat annexed as Annexure-5.

17.06 In view of the oxygen scarcity being faced by hospitals in their fight againstCovid it was decided to prioritise the utilization of our CSR resources to help mitigatethe situation. It was therefore decided to provide Oxygen Plants to the ESI Hospital atYamunanagar as well as to the District Hospital at Muzaffarnagar along with OxygenCylinders and Oxygen Concentrators. j This has strengthened the local healthinfrastructure j and will help fight the current and any future wave of i the pandemic.


18.01 On the recommendation of the Nomination and i Remuneration Committee the Boardhas finalized i the Evaluation Process to evaluate the entire Board Committees ExecutiveDirectors and Non-Executive Directors.

18.02 The method of evaluation as per the Evaluation Process is to be done byinternal assessment through a detailed questionnaire to be completed by individualDirectors.

18.03 In accordance with the Companies Act and the Listing Requirements the evaluationis done once in a year after close of the year and before the Annual General Meeting.


19.01 The Annual Return is available on the website of the company at


20.01 Mr. Vinod K. Nagpal (DIN: 00147777) Mr. Tahir Hasan (DIN: 00074282) Mr. ArunKathpalia (DIN: 00177320) and Mr. Vinod Kumar Sachdeva (DIN: 00454458) are IndependentDirectors who retired from the Board j of the Company on completion of tenure of theirappointment with effect from the conclusion of the 87th Annual General Meetingof the Company held on September 18 2020.

20.02 The Board placed on record its appreciation for the services rendered by them asIndependent Directors during the tenure of their appointment.

20.02 Mr. Sidharth Prasad (DIN: 00074194) Independent Director was reappointed by theShareholders for a second term of 5 (Five) years with effect from October 31 2020 up toOctober 31 2025.

20.03 Mr. Vishal Kirti Keshav Marwaha (DIN: 00164204) Independent Director wasreappointed by the Shareholders for a second term of 5 (Five) years with effect from theconclusion of 87th AGM up to the conclusion of 92nd AGM to be heldin the year 2025.

20.04 Statement regarding the opinion of the Board with regard to integrity expertiseand experience (including the online proficiency self-assessment (test) of the IndependentDirectors appointed during the year is annexed hereto as Annexure-6.


21.01 No new company has become or ceased to be a subsidiary joint venture andassociate company during the year.


22.01 There is no significant or material order passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.


23.01 The Company has not accepted any deposits from the public and as such no amounton account of principal or interest on deposits was outstanding as on the date of close ofthe financial year.


24.01 The Company has adequate internal financial controls with reference to financialstatements and these are working effectively.


25.01 The composition of Audit Committee is as below:- For the period from April 012020 till the conclusion of the 87th AGM of the Company held on September 182020:

Name of the Committee Member No. Position
1. Mr. Vinod K. Nagpal (DIN: 00147777) Chairman
2. Mr. Arun Kathpalia (DIN:00177320) Member
3. Mr. Aditya Puri (DIN:00052534) Member
4. Mr. Sidharth Prasad (DIN:00074194) Member

- For the period from the conclusion of the 87th AGM of the Company held onSeptember 18 2020 till March 31 2021:

S. No. Name of the Committee Member Position
1. Mr. Vishal Kirti (DIN: 00164204) Keshav Marwaha Chairman
2. Mr. Aditya Puri (DIN: 00052534) Member
3. Mr. Sidharth (DIN:00074194) Prasad Member

25.02 There is no recommendation by the Audit Committee which has not been accepted bythe Board.


26.01 Report on Corporate Governance for the year under review as stipulated under theSEBI (Listing Obligations & Disclosure Requirements) Regulations 2015 is annexed asAnnexure- 7.


27.01 In accordance with Section 129(3) of the Companies Act 2013 the Company hasprepared consolidated financial statements of the Company and all its subsidiarycompanies which is forming part of the Annual Report.

27.02 Further as required under Rule 5 of the Companies (Accounts) Rules 2014 astatement in Form AOC- 1 containing salient features of the financial statements of thesubsidiary companies is attached as Annexure-8.


28.01 Disclosures regarding remuneration as required under Section 197 (12) of theCompanies Act 2013 are annexed as Annexure-9.

28.02 Annexure giving certain details about the employees in receipt of remunerationof not less than one crore and two lakh rupees throughout the financial year or eight lakhand fifty thousand rupees per month during any part of the year is not annexed with theBoards' Report. In accordance with Section 136 (1) of the Companies Act 2013 the Annexureis available for inspection by any member at the registered office of the Company duringworking hours 21 days before the date of the AGM.


29.01 The Board has framed Vigil Mechanism / Whistle Blower Policy for DirectorStakeholders Individual Employees and their Representative Bodies in accordance withSection 177 (9) of the Companies Act 2013 read with Rules made thereunder Regulation 4(2) (d) and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirement)Regulations 2015 and Regulation 9A (6) of the SEBI (Prohibition of Insider Trading)Regulations 2015 as amended from time to time. Details of Vigil Mechanism are given inthe Corporate Governance Report. The Vigil Mechanism has been disclosed on the website ofthe Company at VigilMechanismWhistleBlowerPolicy-10.06.2021.pdf


30.01 Pursuant to Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Rules 2014 the provision of maintenance of cost records is applicableon the Company accordingly the cost accounts and records are made and maintained by theCompany.


31.01 The Company has in place a Policy of Prevention on Sexual Harassment in line withthe requirements of the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013. An Internal Complaint Committee has been set up to redresscomplaints received regarding sexual harassment.


32.01 The Board of Directors of the Company has appointed M/s. Pramod Kothari &Co. Company Secretaries to conduct the Secretarial Audit.

32.02 Pursuant to Section 204 of the Companies Act 2013 a Secretarial Audit Reportgiven by Mr. Pramod Kothari of M/s. Pramod Kothari & Co Company Secretaries isannexed as Annexure-10.


33.01 The Company complies with all applicable secretarial standards.


34.01 The Board wishes to express its appreciation to all the employees of the Companyfor their contribution to the operations of the Company during the year.


35.01 Industrial relations remained peaceful.


36.01 Your Directors take this opportunity to thank the Financial Institutions BanksGovernment Authorities Regulatory Authorities and the Shareholders for their continuedco-operation and support to the Company.

36.02 With these remarks we present the Accounts for the year ended March 31 2021.

Aditya Puri Sidharth Prasad
Date: 28.06.2021 Managing Director Director
Place: Noida DIN:00052534 DIN:00074194