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JSW Ispat Special Products Ltd.

BSE: 513446 Sector: Metals & Mining
NSE: JSWISPL ISIN Code: INE743C01021
BSE 00:00 | 15 Jan 32.60 1.45
(4.65%)
OPEN

31.80

HIGH

32.70

LOW

31.00

NSE 00:00 | 15 Jan 32.70 1.55
(4.98%)
OPEN

32.20

HIGH

32.70

LOW

31.25

OPEN 31.80
PREVIOUS CLOSE 31.15
VOLUME 135200
52-Week high 37.00
52-Week low 8.00
P/E
Mkt Cap.(Rs cr) 1,531
Buy Price 32.70
Buy Qty 20501.00
Sell Price 32.70
Sell Qty 291.00
OPEN 31.80
CLOSE 31.15
VOLUME 135200
52-Week high 37.00
52-Week low 8.00
P/E
Mkt Cap.(Rs cr) 1,531
Buy Price 32.70
Buy Qty 20501.00
Sell Price 32.70
Sell Qty 291.00

JSW Ispat Special Products Ltd. (JSWISPL) - Director Report

Company director report

To the Members

The Board of Directors present the 30th Annual Report of the Company along with thefinancial statements for the financial year ended 31 March 2020.

1. FINANCIAL SUMMARY

The financial summary and performance highlights of the Company for the financial yearunder review are as follows:

( ` in Crore except per share data)

S. No. Particulars Standalone Year ended 31.03.2020 Year ended 31.03.2019 Consolidated Year ended 31.03.2020 Year ended 31.03.2019
1 Income from operations
(a) Gross sales 2607.76 1872.35 2607.76 1872.35
(b) Other operating income 30.40 7.06 30.40 7.06
Total income from operations 2638.16 1879.41 2638.16 1879.41
Other Income 25.97 26.83 26.28 27.00
Total income 2664.13 1906.24 2664.44 1906.41
2 Expenses
(a) Cost of materials consumed 1977.84 1744.01 1977.84 1744.01
(b) Changes in inventories of finished goods work-in-progress and stock-in-trade (34.48) (266.01) (34.48) (266.01)
(c) Employee benefits expense 116.46 89.34 117.00 90.35
(d) Finance costs 253.32 445.27 253.32 445.27
(e) Depreciation and amortization expense 216.99 275.60 218.76 277.51
(f) Power and fuel 287.28 147.85 287.28 147.85
(g) Other expenses 334.88 163.37 336.72 164.00
Total expenses 3152.29 2599.43 3156.44 2602.98
3 Loss from operations before exceptional items and tax (1-2) (488.16) (693.19) (492.00) (696.57)
4 Exceptional items - 2767.92 - 2855.67
5 Loss before tax (3-4) (488.16) (3461.11) (492.00) (3552.24)
6 Tax expense:
(i) Current tax - - - -
(ii) Deferred tax - - - -
7 Loss after tax for the year(5 + 6) (488.16) (3461.11) (492.00) (3552.24)
8 Other comprehensive loss (after tax)
A. (i) Items thatwillnotbereclassifiedtoprofit loss or (3.65) (33.04) (3.64) (33.06)
(ii) Income tax relating to items that will not be reclassified to profit and loss - - - -
B. (i) Items that will be reclassified to profit or loss - - (25.69) -
(ii) Income tax relating to items that will be reclassified to profit and loss - - - 9.98
9 Total comprehensive loss for the year(7+8) (491.81) (3494.15) (521.33) (3575.32)
Total comprehensive loss for the year attributable to:
Owner of the company - - (521.21) (3575.19)
Non-controlling interests - - (0.12) (0.13)
Total loss for the year attributable to:
Owner of the company - - (491.88) (3552.11)
Non-controlling interests - - (0.12) (0.13)
Other comprehensive loss for the year attributable to:
Owner of the company - - (29.33) (23.08)
Non-controlling interests - - - -

2. FINANCIAL AND OPERATIONAL PERFORMANCE

The Company has two manufacturing facilities namely at Raigarh and Raipur in State ofChhattisgarh.

During the financial year under review the Company had taken shut down of the steelmanufacturing operations other than Pellet Plant and Sponge Iron Plant at its RaigarhChhattisgarh plant with effect from 21 June 2019 for necessary modifications and generalmaintenance. The integrated steel operations at the Raigarh Plant of the Company werere-started with effect from 02 March 2020. However in view of 21 days' nationwidelockdown advisory announced by the Government of India and other authorities to containthe spread of Corona Virus disease (COVID-19) the Company temporarily suspended all themanufacturing operations of its plants situated at Raipur and Raigarh both located in theState of Chhattisgarh with effect from 25 March 2020. The Company has taken aforesaidtemporary suspension of its all plants operations even though the manufacturing units withcontinuous operation and the units producing essential commodities (Steel is classified asan essential commodity under the Essential Services Maintenance Act 1981 (ESMA)) wereexempted from the lockdown announcement supporting the initiative of the Government forcontainment of COVID -19 epidemic.

The Company restarted the integrated steel manufacturing operations at the Raigarhplant of the Company with effect from 02 May 2020 and the manufacturing operations atRaipur plant were restarted with effect from 15 May 2020.

The manufacturing operations of the Company are conducted in compliance with therelevant guidelines/ advisory issued by the Government and authorities for takingnecessary measures for the containment of COVID-19 including measures like maintainingsocial distancing. Following is the operational and financial performance of the Companyfor the financial year under review:

Standalone:

The Company's operational performance in terms of physical production and sales duringthe year ended on 31 March 2020 is as under –

Production (MT)–

Particulars FY'2020 FY'2019 Increase / (Decrease) (+)/(-) Variance
Sponge Iron 829228 722371 106856
Billets 212266 157430 54836
Structural Steel/ 134561 108945 25616
TMT
Ferro Alloys 24722 28358 (3636)
Pellets 1661150 537920 1123230
Pig Iron 221141 73700 147441

Sales Data (MT)–

Particulars FY'2020 FY'2019 Increase / (Decrease) (+)/(-) Variance
Sponge Iron 699354 580240 119114
Billets 76580 32442 44138
Structural Steel / 126318 98098 28220
TMT
Ferro Alloys 22813 25173 (2360)
Pellets 774078 81647 692431
Pig Iron 34431 7761 26670

During the year under review the Company's revenue from operations was `2638.16 croresas against ` 1879.41 crores in the previous year. The Company's loss before depreciationinterest and tax was ` 17.85 crores in the financial year ended 31 March 2020 as opposedto profit before depreciation interest and tax of ` 27.68 crores in the immediatepreceding year.

Taking into account depreciation and interest costs loss before tax (LBT) stood at `488.16 crores as against LBT of

` 3461.11 crores in the previous year and total comprehensive loss for the year was `491.81 crores as against total comprehensive loss of ` 3494.15 crores in the previousfinancial year.

During the year under review there were no exceptional items as against `2767.92crores in the year ended on 31 March 2019.

Consolidated:

During the year under review the Company's consolidated revenue from operations was`2638.16 crores as against `1879.41 crores in the previous year. Further in the financialyear ended 31 March 2020 loss before tax (LBT) was ` 492.00 crores as against LBT of `3552.24 crores in the previous year and loss after tax was ` 492.00 crores against lossafter tax

` 3552.24 crores in the previous financial year.

The performance and financial position of the subsidiary companies and joint venturesis included in the consolidated financial statement for the financial year under review.

3. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OFTHE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TOWHICH THE FINANCIAL STATEMENTS RELATES AND THE DATE OF THE REPORT

The outbreak of COVID-19 pandemic in the financial year under review has not beencontained on the contrary its severity has been increased all over the globe includingIndia severally impacting economy. The impact of COVID-19 pandemic is detailed underManagement Discussion and

Analysis Report (Annexure - 8 of the report). Apart fromCOVID-19pandemicimpactwhichmayaffectthe financial position of the Companythere are no other material changes and commitments affecting the fi of the Companyrequired to be reported under this section.

4. DIVIDEND AND RESERVES

In view of the losses incurred by the Company the Board of Directors of the Companyhave not recommended any dividend for the financial year under review. As the Company hasincurred losses during the year no amount has been transferred to Reserves.

5. SUBSIDIARIES JOINT VENTURES OR ASSOCIATE COMPANIES

As on 31 March 2020 the Company has four subsidiaries

(including 2 step-down subsidiaries) and four joint ventures. During the Companyhas sold and transferred the entire equity shareholding held by it in Monnet SportsFoundation and Chomal Exports

Private Limited to M/s Champak Corporate Services Private

Limited (‘the Acquirer')consequently both these companies effceasedasthesubsidiariesoftheCompanywith ect from 15 January 2020.

The consolidated by the Company include financial information of itssubsidiaries and joint ventures prepared in compliance with applicable Ind-AS. Theconsolidated financial statement does not include financials of Monnet Power CompanyLimited (MPCL) which ceased to be an associate of the Company w.e.f. 23 October

2019 upon initiation of its liquidation as per provisions of the Insolvency andBankruptcy Code 2016 and order issued byNationalCompanyLawTribunal.TheCompanyhaswrittenoff its investment in MPCL during previousfinancial year.

A gist of financial highlights/performance of these Companies is contained in FormAOC-1 and forms part of this report and annexed as Annexure-1. The separateaudited/unaudited financial statements of these subsidiaries as case may be areavailable on the website of the Company vizwww.aionjsw.in. The annual financial statementsof the subsidiary companies are open for inspection by any shareholder at the Company's

Registered Office situated at Monnet Marg Mandir Hasaud Raipur Chhattisgarh -492101and the Company will make available these documents and the related detailed informationupon request by any shareholder of the

Company or any shareholder of its subsidiaries joint ventures companies who may beinterested in obtaining the same. Also the standalone financial statements consolidatedstatements and financial statements of subsidiaries available on the website of theCompany vizwww.aionjsw.in.

Further the consolidated financial statements of the Company and its subsidiaries andjoint ventures for the year under review is prepared in compliance with the applicableprovisions of the Companies Act 2013 Indian Accounting Standards (Ind-AS) and theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 as amended ("SEBI Listing Regulations 2015") which forms partof the Annual Report.

6. SHARE CAPITAL

As on 31 March 2020 the authorized capital of the Company was `15500000000/-(Rupees one thousand five hundred and fifty crores only) and the paid up capital stands at

` 9955275340/- (Rupees nine hundred and ninety-five crores fifty-two lakhs seventyfive thousand three hundred and forty only) consisting of 469547534 equity shares of `10 (Rupees ten) each and 525980000 Compulsory

Convertible Preference Shares of `10 (Rupees ten) each. There was no change in sharecapital of the Company during the financial year under review.

7. DEBENTURES

During the financial year under review the Company has not issued or allotted anyDebentures and does not have any outstanding Debentures.

During the year under review 9200 Secured Redeemable Non-Convertible Debentures(NCDs) of `1000000/- each of the Company were delisted from the stock exchange i.e. BSELimited.

8. CREDIT RATING

During the year under review CARE Ratings Limited (Formerly known as Credit Analysis& Research Limited) in the month of April 2019 had assigned the credit rating of"A-" Stable for long term bank facilities (term loan & fund based-cashcredit) and "A- Stable/A2+" for non-fund based long/short term bank facilitiesbank guarantees of the Company.

However CARE Ratings Limited in the month of March 2020 revised the credit ratings ofthe Company to "BBB+" Stable for long term bank facilities (term loan & fundbased-cash credit) and "BBB+; Stable/A2" for non-fund based long/short term bankfacilities bank guarantees of the Company.

9. PUBLIC DEPOSITS

The Company has not accepted or renewed any public deposits during the period underreview. It has not accepted any deposits from the public within the meaning of theprovisions of Section 73 of the Companies Act 2013 and

Rules made there under. Therefore it is not required to furnish information in respectof outstanding deposits under non-banking non-financial Companies (Reserve Bank)Directions

1966 and Companies (Accounts) Rules 2014.

10. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

During the year there are no significant or material orders passed by the Regulators/Courts/ Tribunals that could impact the going concern status of the Company and its futureoperations.

Further members' attention is drawn to the statement on contingent liabilitiescommitments in the notes forming part of the financial statements.

 11. INTERNAL CONTROLS AUDIT AND INTERNALFINANCIAL CONTROLS

Internal control systems are integral to the Company's corporate governance. Theinternal control systems and procedures are designed to assist in the identification andmanagement of risks the procedure-led verification of all compliances as well as anenhanced control consciousness.

The Board / management are of the opinion that based on the knowledge/ informationgained by them about affairs of the

Company from records of the Company the Company has effective internal financialcontrol systems and policies and such controls are operating effectively.

The internal control systems include documented policies checks and balancesguidelines and procedures that are supplemented by robust internal audit processes andmonitored continuously through periodical reviews by management to provide reasonableassurance that all assets are safeguarded; and all transactions entered into by

Company are authorized recorded and reported properly.

Internal Audit plan and execution

The Internal Audit function prepares audit plan which is approved by the AuditCommittee. The frequency of the audit is decided by risk ratings of areas/functions. Theaudit plan is carried out by the internal team and reviewed periodically to include areasthat have assumed significant importance in line with the emerging industry trend and theaggressive growth of the Company. In addition the Audit Committee also places reliance oninternal customer feedback and other external events for inclusion into the audit plan.Significant observations if any of Internal Auditor are reported to the Audit Committeeevery quarter.

Internal financial controls

The Company has sound internal controls including internal financial control frameworkwhich is commensurate with the size scale and nature of business of the Company. Theframework includes entity-level policies processes and

Standard Operating Procedures (SOP). During the year under review the Company hasimplemented SAP ERP system at its

Raigarh unit from 1 August 2019 as a part of strengthening the internal control andinternal financial control framework. The Audit Committee of the Board of Directorsregularly reviews audit plans significant audit findings adequacy of internal controlsand compliance with Accounting Standards etc. The Company has also strong internal auditprocess and the internal auditor reports to the Audit Committee on regular basis withaudit findings and the audit plans. The internal audit team has access to all informationin the organization and this process is largely facilitated by ERP implementation in theCompany.

The Internal control systems and procedures are designed to assist in theidentification and management risks the procedure-led verification of all compliances aswell as enhanced control consciousness. During the financial year under review thecontrols were tested and no reportable material weakness in design and effectiveness wasobserved.

12. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

As on 31 March 2020 the Board of Directors of the Company consists 1 Whole-timeDirector (Executive) 3 Independent Directors and 4 Non- Executive Directors of theCompany the details of which are given in the Corporate Governance

Report which forms part of this Annual Report. During the year under review there wasno change in the composition of the Board of Directors.

In accordance with the provisions of section 152 of the

Companies act 2013 and Articles of association of the

Company Mr. Nikhil Gahrotra and Mr. Kalpesh Kikani Directors retires by rotation atthe forthcoming Annual General Meeting and being eligible offered themselves forre-appointments. Your Board recommends their re-appointment.

The details of profile experience other directorships etc. in respect of Mr. NikhilGahrotra and Mr. Kalpesh Kikani as required under Regulations 26(4) and 36(3) of the SEBI(Listing Obligations and Disclosure Requirement) Regulations 2015 and SecretarialStandard -2 is annexed to the Notice of forthcoming 30th Annual General Meetingof the Company.

There were no changes in the Key Managerial Personnel of the Company during the yearunder review.

13. DIRECTORS‘ RESPONSIBILITY STATEMENT

Pursuant to the requirements under Section 134 (5) of the Companies Act 2013 theBoard of Directors to the best of their knowledge and ability state and confirm that:(a) in the preparation of the annual accounts for the financial year ended 31 March 2020the applicable accounting standards have been followed and a proper explanation has beenprovided in relation to any material departures; (b) such accounting policies have beenapplied consistently (except for the change in the method of valuation of inventory fromFirst in First Out to Weighted Average during the current year w.e.f. 1 August 2019) andmade judgments and estimates that are reasonable and prudent so as to give a reasonablytrue and fair view of the state of affairs of the Company at the end of the financial yearended 31 March 2020 and of the loss of the Company for the year; (c) proper and sufficientcare for the maintenance of adequate accounting records in accordance with the provisionsof the Companies Act 2013 for safeguarding the assets of the Company and for preventingand detecting fraud and other irregularities; (d) the annual accounts for the financialyear ended 31 March 2020 have been prepared on a going concern basis; (e) internalfinancial controls to be followed by the Company and such internal financial controls areadequate and are operating effectively; and (f) proper systems to ensure compliance withthe provisions of all applicable laws and such systems are adequate and operatingeffectively.

14. ANNUAL EVALUATION OF PERFORMANCE OF BOARD ITS COMMITTEES AND DIRECTORS

Pursuant to applicable provisions of the Companies Act

2013 and the SEBI Listing Regulations 2015 the Board has formulated a frameworkcontaining inter-alia the criteria for performance evaluation of the entire Board of theCompany its Committees and individual Directors including Independent Directors("the Performance Evaluation Policy"). For the evaluation of all the Directorswas carried out by the

Nomination and Remuneration Committee. The performance evaluation of the Chairman andthe Non-Independent

Directors was carried out by the Independent Directors. The

Board carried out an annual performance evaluation of its own performance theperformance of the Independent Directors individually as well as the evaluation of theworking of the

Committees of the Board.

Details of the same are given in the report on Corporate Governance annexed hereto.

15. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

During the financial year under review four (4) Board Meetings were convened and heldthe details of which are given in the Corporate Governance Report. The intervening gapbetween these Meetings was within the period prescribed under the Companies Act 2013 andRegulations 17 of the Securities and Exchange Board of India (Listing Obligation andDisclosure Requirements) Regulation 2015.

16. COMMITTEES OF THE BOARD

Your Company has duly constituted the Committees as required under the Companies Act2013 read with applicable Rules made there under and the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.

At present following are the Committees of the Board; a. Audit Committee b. Nominationand Remuneration Committee c. Stakeholders Relationship Committee d. Corporate SocialResponsibility Committee e. Finance Committee f. Business Responsibility Reporting (BRR)and International Trade Practice Committee The details of composition of each Committeeterms of the reference and number of meetings held during the year under review are givenin the Corporate Governance Report annexed to this report.

17. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTORS

The Company has received the necessary declaration from each Independent Directors whoare part of Board confirming that; a) he/she meets the criteria of Independence as laidout in

Section 149(6) of the Companies Act 2013 read with the Schedules rules made thereunder and Regulation 25 of SEBI Listing Regulations 2015 and b) registered themselveswith the Independent Directors' Databank as per the Companies (Appointment andQualification of Directors) Fifth Amendment Rules 2019.

18. NOMINATION AND REMUNERATION POLICY

Pursuant to the SEBI Listing Regulations 2015 read with SEBI (Listing Obligations andDisclosure Requirements) (Amendment) Regulations 2018 the Board of Directors has put inplace the Nomination and Remuneration policy of the Company.

The details of the policy are explained in the Corporate

Governance Report which forms part of this Annual Report. The Nomination andRemuneration Policy as approved by the Board of Directors is also hosted on the websiteof the

Company viz:-https://www.aionjsw.in/investors/policies.

19. VIGIL MECHANISM CUM WHISTLE BLOWER POLICY

The Company has a vigil mechanism named as Vigil

Mechanism Cum Whistle Blower Policy to deal with instances of fraud and mismanagementif any. Details of the same are given in the Corporate Governance Report. The policy isavailable on the website of the Company viz:-https://www. aionjsw.in/investors/policies.

20. RELATED PARTY TRANSACTIONS

All Related Party Transactions (RPT) that were entered into by the Company during thefinancial year under review were on an arm's length basis and in the ordinary course ofbusiness and thus a disclosure in Form AOC-2 in terms of Section

134 of the Act is not required. Further there are no material related partytransactions during the year under review with any related party. All related partytransactions are mentioned in the notes to the accounts. The Company has developed aframework through Standard Operating Procedures for the purpose of identification andmonitoring of such Related

Party Transactions.

The policy on "Policy on Materiality of Related Party Transactions and also ondealing with Related Party

Transactions" (‘the Policy') as approved and amended by the

Board of Directors has been uploaded on the website of the

Company viz : https://www.aionjsw.in/investors/policies. The Policy intends to ensurethat proper reporting approval and disclosure processes are in place for all transactionsbetween the Company and Related Parties. This Policy specifically deals with the reviewand approval of RPT keeping in mind the potential or actual conflicts of interest thatmay arise because of entering into these transactions. All RPT are placed before the AuditCommittee for review and approval.

Prior omnibus approvals are obtained for related party transactions that are ofrepetitive nature and / or entered in the ordinary course of business and are at arm'slength in compliance with applicable provisions. The statement giving details of allRelated Party Transactions are placed before the

Audit Committee / the Board for review and approval on a quarterly basis.

21. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Details of Investments Loans and Guarantees as covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the financial statements.

22. CORPORATE SOCIAL RESPONSIBILITY

In compliance with Section 135 of the Companies Act 2013 read with the Companies(Corporate Social Responsibility Policy) Rules 2014 as amended the Board of the Companyhas formed Corporate Social Responsibility ("CSR")

Committee. The policy on CSR as approved by the Board of

Directors is also hosted on the website of the Company i.e.https://www.aionjsw.in/investors/policies.

Pursuant to Section 135 of the Companies Act 2013 read with CSR policy of the Companyit is required to spend two percent of the average net profit of the Company for threeimmediately preceding financial year. As the average net profit of the Company duringprevious three financial years is negative the Company is not required to spend anyamount for the CSR purpose during the year under review. Annual Report on mandatory CSRactivities as required under the Companies (Corporate Social Responsibility Policy) Rules

2014 as amended have been annexed as Annexure-2 and forms integral part ofthis Report.

23.AUDITORS

a) Statutory Auditor

At the 29th Annual General Meeting ("AGM") of the Company held on 19 July2019 members of the Company had approved the appointment of M/s. Deloitte Haskins &Sells

LLP Chartered Accountant Mumbai (Registration Number

117366W/W-100018) as the statutory auditor for a period of 5 years with effect from theconclusion of the ensuing 29 th AGM till the conclusion of 34th AGMof the Company.

The Auditors have audited standalone and consolidated financial statements of theCompany for the financial year ended 31 March 2020 and no fraud has been reported by theAuditors under Section 143(12) of the Companies Act 2013 requiring disclosure in theBoard's Report. The Report does not contain any qualification reservation or adverseremark or disclaimer requiring explanation or comments from the Board under Section 134(3)of the Companies Act 2013. b) Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies

Act 2013 and the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 the

Board at its meeting held on 17 May 2019 has appointed M/s S. Srinivasan & Co. aCompany Secretaries firm to conduct a secretarial audit of the Company for the financialyear 2019-2020. The Report of the Secretarial Audit carried out for the financial year2019-2020 is annexed herewith as Annexure -3.

The report does not contain any qualification reservation or adverse remark ordisclaimer requiring explanation or comments from the Board under Section 134(3) of theCompanies Act 2013.

The Board at its meeting held on 18 May 2020 has reappointed M/s S. Srinivasan &Co. a Company Secretaries

Firm Practicing Company Secretaries as Secretarial Auditor for conducting SecretarialAudit of the Company for financial year 2020-2021.

c) Cost Auditor

Pursuant to Section 148(2) of the Companies Act 2013 read with the Companies (CostRecords and Audit) Amendment Rules 2014 your Company is required to get its costaccounting records audited by a Cost Auditor.

Accordingly the Board at its meeting held on 18 May 2020 on the recommendation ofthe Audit Committee has appointed

M/s. Shome & Banerjee Cost Accountants (Firm Reg. No.

00001) to conduct the audit of the cost accounting records of the Company for financialyear 2020-2021 on a remuneration of `300000/- plus taxes as applicable and reimbursementof actual travel and out-of-pocket expenses. The remuneration is subject to theratification of the Members in terms of Section

148 read with Rule 14 of the Companies (Audit and Auditors)

Rules 2014 and is accordingly placed for your ratification. The due date for filingthe Cost Audit Report of the Company for the financial year ended 31 March 2019 was 30September 2019 and the Cost Audit Report was filed in XBRL mode on

22 August 2019.

24. COMPLIANCE WITH THE PROVISIONS OF SECRETARIAL STANDARDS

The Company has in place proper systems to ensure compliance with the provisions of theapplicable secretarial standards issued by the Institute of Company Secretaries of Indiaand such systems are adequate and operating effectively. During the financial year underreview the

Company was in compliance with Secretarial Standards i.e.

SS- 1 and SS- 2 relating to "Meetings of Board of Directors" and"General Meetings" respectively.

25. RISK MANAGEMENT

The Company has a Risk Management Policy of the Company duly adopted by the Board ofDirectors.

The Company recognizes that the emerging and identified risks need to be managed andmitigated to; protect its shareholders and other stakeholder's interest achieve itsbusiness objective and enable sustainable growth.

The Board oversees the Enterprise Risk Management framework to ensure execution ofdecided strategies with focus on action; monitoring risks arising out of unintendedconsequences of decisions or actions related to performance operations complianceincidents processes and systems transactions and the same are managed appropriately.

26. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO

In accordance with Section 134(3)(m) of the Companies Act 2013 read with the Rule8(3) of the Companies (Accounts)

Rules 2014 as amended the information on conservation of energy technologyabsorption and foreign exchange earnings and outgo are annexed as Annexure –4hereto and forms an integral part of this Report.

27. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Disclosures pertaining to remuneration and other details of the employees as requiredunder Section 197(12) of the Companies Act 2013 read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 as amended areannexed to this report as Annexure -5 and 6.

28. EXTRACT OF ANNUAL RETURN

In accordance with the provisions of the Companies Act 2013 and amendment thereto theextract of the annual return in Form No. MGT – 9 is annexed as Annexure-7 andsame is hosted on the website of the Company https://www.aionjsw. in/investors/mgt9.

29. MANAGEMENT DISCUSSION & ANALYSIS REPORT

A detailed analysis of the Company's performance is discussed in the ManagementDiscussion and Analysis Report which forms part of this Annual Report and annexed as Annexure-8.Certain statements in the ‘Management Discussion and

Analysis' section may be forward-looking and are stated as required by applicable lawsand regulations. Many factors may affect the actual results which would be different fromwhat the Directors envisage in terms of the future performance and outlook. Investors arecautioned that this discussion contains forward looking statement that involve risks anduncertainties including but not limited to risks inherent in the Company's growthstrategy dependence on certain businesses dependence on availability of qualified andtrained manpower and other factors discussed. The discussion and analysis should be readin conjunction with the Company's financial statements and notes on accounts.

30. BUSINESS RESPONSIBILTY REPORTING

The Securities and Exchange Board of India (‘SEBI') pursuant to Regulation 34 ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) (Fifth Amendments) Regulations 2019 mandated top 1000 listed

Companies (by market capitalization) to include Business

Responsibility Report (BRR) as a part of the annual report of the Company fromfinancial year 2019-2020 onwards.

The Company is committed to pursuing its business objectives ethically transparentlyand with accountability to all its stakeholders. The Company believes in demonstratingresponsible behavior while adding value to the society and the community as well asensuring environmental well-being with a long-term perspective.

BRR for the financial year 2019-2020 forms part of this Annual

Report as Annexure 9.

31. CORPORATE GOVERNANCE REPORT

The Company constantly endeavours to follow the corporate governance guidelines andbest practice sincerely and disclose the same transparently. The Board is conscious of itsinherent responsibility to disclose timely and accurate information on the Company'soperations performance material corporate events as well as on the leadership andgovernance matters relating to the Company. Your Company has complied with therequirements of Securities and Exchange Board of India (Listing Obligation and DisclosureRequirements) Regulations

2015 regarding corporate governance.

A report on the Corporate Governance practices followed by the Company together with acertificate(s) regarding compliance is given as an Annexure-10 to this report.

32. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE

 (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The Company has laid down Anti Sexual Harassment policy on Gender Equality GenderProtection Prevention of Sexual Harassment and Redressal System as per the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. AnInternal Complaints Committee

(ICC) has been set up to redress complaints received regarding sexual harassment. Allemployees (permanent contractual temporary apprenticeship) are covered under thispolicy. No complaints pertaining to sexual harassment were received or pending to beresolved by the Company in this respect during financial year 2019-2020.

33. OTHER DISCLOSURES / REPORTING

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions pertaining to these items during the yearunder review:

1. Issue of equity shares with differential rights as to dividend voting or otherwise;

2. Issue of shares (including sweat equity shares) to employees of the Company underany scheme or ESOPs;

3. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries;

34. ACKNOWLEDGEMENT

The Directors wish to place on record their gratitude to the authorities banksbusiness associates shareholders customers dealers agents and suppliers for theirunstinted support assistance and co-operation and faith reposed in the Company. TheDirectors place on record their deep appreciation to employees at all levels for theirhard work dedication and commitment.

Place: Mumbai By order of the Board
Date: 18 May 2020 For Monnet Ispat and Energy Limited
Jyotin Mehta
Chairman
DIN: 00033518

Annexure-1

FORM NO. AOC -1

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014) Statement containing salient features of the financialstatement of subsidiaries/associate companies/joint ventures

Part "A": Subsidiaries

(Amount in `)

SI. No. 1 2 3 4
Name of the subsidiary Monnet Sport Foundation Chomal Exports Private Limited Monnet Global Limited
Monnet Cement Limited (upto 15 Jan 2020) (upto 15 Jan 2020)
Date since when subsidiary was acquired 29 November 2007 12 December 2011 31 December 2010 17 September 2005
Reporting period for the subsidiary concerned Same Same Same Same
Reporting Currency and exchange rate as on last date Rupees Rupees Rupees Rupees US Dollar
of the financial year in case of foreign subsidiaries
Share capital 21900000 100000 954000 377517284 5007797
Reserves and surplus (20218239) - - (4158159701) (55158321)
Total asset 1711889 - - 372152272 4936630
Total liabilities 30128 - - 4152794714 55087154
Investments - - - - -
Turnover - - - - -
Profit before taxation (587774) - - (40696284) (563052)
Provision for taxation - - - - -
Profit after taxation (587774) - - - -
Proposed Dividend - - - - -
% of shareholding 100.00% 64.15% 51.00% 100.00%
Additional Disclosure
Subsidiaries Yet to commence Operations Monnet Cement Limited
Monnet Global Limited
Subsidiaries Liquidated or Sold during the Year Monnet Sport Foundation (upto 15 January 2020)
Chomal Exports Private Limited (upto 15 January 2020)

Part "B": Associates/Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act 2013 related to AssociateCompanies and Joint Ventures

Name of Associates/Joint Ventures MP Monnet Company Limited Mining Company Limited Mandakini Coal Urtan North Mining Company Limited Monnet Ecomaster Enviro Private Limited Monnet Power Comapny. Limited
1. Latest audited Balance Sheet Date 31 Mar 2020 31 Mar 2020 31 Mar 2020 31 Mar 2020
2. Date on which the Associate or Joint Venture was associated or acquired 20 Jun 2009 14 Mar 2008 4 Mar 2010 29 Mar 2011
3. Shares of Associate/Joint Ventures held by the company
on the year end
a) No. 980000 39300000 5751347 14211363
b) Amount of Investment in Associates/Joint Venture 9800000 393000000 57513470 142113630
c) Extend of Holding % 49.00% 33.33% 33.33% 50.00%
Description of how there is significant influence % of shareholding % of shareholding % of shareholding % of shareholding (Refer Note -1 below)
5. Reason why the associate/joint venture is not N.A. N.A. N.A. N.A.
Consolidated
6. Networth attributable to Shareholding as per latest 5392840 678570312 162932745 (170252920)
audited Balance Sheet
7. Profit / Loss for the year
i. Considered in Consolidation (25558) (560470) - (59445018)
ii. Not Considered in Consolidation (27123) (1120940) - (59445018)
Total (52682) (1681410) - (118890036)

Note -1: Statement does not include information of Monnet Power Company Limited (MPCL)which ceased to be an associate of the Company w.e.f. 23 October 2019 upon initiation ofits liquidation as per Insolvency and Bankruptcy Code for liquidation of the CorporateDebtor.

Additional Disclosure

Associates/Joint ventures Yet to commence Operations MP Monnet Mining Company Limited
Mandakini Coal Company Limited
Urtan North Mining Company Limited
Associates/Joint ventures Liquidated or Sold during the Year See note 1 above.

.