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MSP Steel & Power Ltd.

BSE: 532650 Sector: Metals & Mining
NSE: MSPL ISIN Code: INE752G01015
BSE 00:00 | 04 Aug 12.00 -0.62






NSE 00:00 | 04 Aug 12.00 -0.60






OPEN 12.88
VOLUME 176054
52-Week high 13.35
52-Week low 5.86
P/E 92.31
Mkt Cap.(Rs cr) 463
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 12.88
CLOSE 12.62
VOLUME 176054
52-Week high 13.35
52-Week low 5.86
P/E 92.31
Mkt Cap.(Rs cr) 463
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

MSP Steel & Power Ltd. (MSPL) - Director Report

Company director report

Dear Members


We are pleased to present you the 49th Annual Report of your Company along with theStandalone and Consolidated Audited Financial Statements and the Auditor's Report for thefinancial year ended 31st March 2018.


The Company's financial performance for the year ended 31st March 2018 issummarised below:




F.Y. 17-18 (' in Lacs) F.Y. 16-17 ('in Lacs) F.Y. 17-18('in Lacs) F.Y. 16-17(' in Lacs)
Revenue from Operations 118794.72 84283.58 118794.72 84283.58
Other Income 261.85 105.16 261.85 105.26
Total Income 119056.57 84388.74 119056.57 84388.84
Total Expenses (D) 125688.60 94794.36 125688.60 94809.07
Profit/(Loss) Before Tax (E=C-D) (6632.03) (10405.62) (6632.03) (10420.23)
Add/(Less): Exceptional Items(F) 476.24 476.24 -
Less: Tax Expenses (G)
Income Tax for Earlier Years - 154.05 - 154.05
Deferred Tax (585.27) (1199.23) (585.27) (1199.23)
Profit/(Loss) for the Year (E+F-G) (5570.52) (9360.44) (5570.52) (9375.05)
Share of Profit/(Loss) of Associates N.A N.A 1.74 (13.92)

The financial statements have been prepared in accordance with Indian AccountingStandards ("Ind AS") as prescribed under Section 133 of the Companies Act 2013read with rule 7 of The Companies (Accounts ) rules 2014. Indian Generally AcceptedAccounting Principles (GAAP) has been replaced by Ind AS. Accordingly your Company hasadopted Indian Accounting Standards ("Ind AS") from 1st April 2016 with atransition date of 1st April 2015 and this financial results alongwith the comparativeshave been prepared in accordance with the recognition and measurement principles statedtherein prescribed under Section 133 of the Companies Act 2013 read with relevant rulesissued there under and the other accounting principles generally accepted in India. Thefinancial statements for the year ended 31st March 2016 have been restated to comply withthe IND AS to make them comparable.

Indian Accounting Standards shall also be applicable to subsidiary companies jointventures or associates of the Company. Hence the financial statement of MSP CementLimited AA EssTradelinks Pvt. Ltd. and Madanpur South Coal Company Limited shall beprepared in accordance to it.


The growth in the Indian steel sector has been driven by domestic availability of rawmaterials such as iron ore and cost-effective labour. Consequently the steel sector hasbeen a major contributor to India's manufacturing output The significant increase inglobal steel prices from November 2017 which began with rise in raw material prices —iron ore coking coal and scrap — and increase in global oil prices were factorswhich made it possible for rise in steel consumption by 3.1% from last year. In thecurrent year also till October 2017 the rise in steel consumption for the first 7 monthswas confined to 4.5%.

India's crude steel production was up 4.4 per cent and stood at 93.11 million tonnes(mt) for the period April 2017 to February 2018 compared with April 2016 to February2017which has helped India to overtake Japan and becomes the second largest producer ofcrude steel in the world.

According to the data released by Department of Industrial Policy and Promotion (DIPP)the Indian metallurgical industries attracted Foreign Direct Investments (FDI) to the tuneof US$ 10.56 billion in the period April 2000- December 2017.

The Union Cabinet Government of India has approved the National Steel Policy (NSP)2017 as it seeks to create a globally competitive steel industry in India. NSP 2017targets 300 million tonnes (MT) steel-making capacity and 160 kgs per capita steelconsumption by 2030.

Consolidated Results

Your Company has achieved a gross revenue of Rs. 118794.72 Lacs in the financial year2017-18 as compared to Rs. 84283.58 Lacs in the previous Financial Year 2016-17. TheManagement has reduced the cost of production and implemented a strategy which hasresulted in decreasing the loss of the Company from Rs.(9360.44) Lacs incurred during theprevious Financial Year to the loss of Rs.(5570.52) Lacs

The Management has taken initiative for improving the performance of the Companyresulting from optimization of the cost to focus on yields and productivity.

Consolidated Results

The financial performance of the subsidiary company associate company and Jointventure are included in the Consolidated financial statement of the Company.

Revenue from Operations on consolidated basis stood at Rs. 118794.72 Lacs for the FY2017-18. The Company reported a net lossof Rs. (5570.52)Lacs for F.Y. 17-18 as compared tothe net loss of Rs. (9375.05) Lacs for the F.Y 2016-17.

Further the statement containing the salient features of our subsidiaries pursuant tosubsection 3 of Section 129 of the Companies Act 2013 in the prescribed form AOC-1 isappended as Annexure-1 to the Director's Report. The Statement provides the detailedperformance of the Subsidiaries including associate company and Joint venture.

The statement containing the salient features of our subsidiaries pursuant tosubsection 3 of Section 129 of the Companies Act 2013 in the prescribed form AOC-1 isappended as Annexure-1 to the Director's Report. The Statement provides the detailedperformance of the Subsidiaries including associate company and Joint venture.

The list of Subsidiaries and Associates of your Company as on March 31 2018 forms apart of Form No. MGT-9 Extract of the Annual Return which is annexed at as Annexure-2 tothe Director's Report

• MSP Cement Limited is a wholly owned subsidiary of the Company having itsRegistered Office at Banglapara North Chakradhar Nagar Raigarh- 496001 was incorporated on2nd June 2008 for manufacturing and sale of cement and clinker products. The Company isyet to commence its commercial operations.

• AA ESS Tradelinks Private Limited associate company of MSP Steel & PowerLimited is engaged in trading of industrial oxygen gases.

• Madanpur South Coal Company Limited incorporated on 23rd May 2006 havingits registered Office at Raipur Chattisgarh was formed by the Venture partners MSP Steel& Power Limited Hindustan Zinc Ltd. Akshay Investment Pvt. Ltd. Chattisgarh Steel& Power Limited and Chattisgarh Electricity Company Ltd with respect to obtain miningrights in respect of the Coal Blocks of Madanpur and use coal for its captive requirements

The details as required under Section 136 of the Companies Act 2013 and Rule 8 of theCompanies (Accounts) Rules 2014 regarding the performance and the financial position ofthe Subsidiary Company Associate Company and Joint Venture Company forms part of theConsolidated Financial Statement of the Company and applicable Indian Accounting Standards("Ind AS") for the Financial Year ended 31st March 2017.

Your Company has formulated a policy for determining 'Material Subsidiary' in terms ofthe Regulation 16(c ) of SEBI (Listing Obligations and Disclosure Requirements)Regulation 2015. The said policy is also available at the Company's website Material%20Subsidiaries.pdf

As per the provisions of section 136 of the Companies Act 2013 copy of the auditedfinancial statements including consolidated financial statements auditor's report alongwith the relevant documents and separate audit accounts in respects of the subsidiariesshall be kept open for inspection at the Registered office of your Company during workinghours on all days except Saturdays Sundays and public holidays for a period of twenty-onedays before the date of Annual General Meeting. Any member willing to obtain a copy of thesaid financial statements may write to the Company at its Registered office or CorporateOffice or visit the below mentioned website link for the same:


Your Your Company has not accepted any public deposit during the year under reviewwithin the meaning of provisions of Section 73 of Companies Act 2013 read with theCompanies (Acceptance of Deposit) Rule 2014.


Particulars of loans given investments made guarantees given or securities providedare as per the provisions of Section 186 of the Companies Act 2013 and forms part of thenotes to the financial statements provided in this Annual Report.


Management's Discussion and Analysis Report for the year under review stating theoperations of the Company as stipulated under Regulation 34 of Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulation 2015("SEBI LODR") is presented in a separate section and forms an integral part ofthe Annual Report.


Corporate Governance aims at creating ethical value that is not only profitable for thebusiness but also aims at enhancing an organization's brand and reputation. Your Companyis committed to achieve highest standards of Corporate Governance and adheres to theCorporate Governance requirements set out by the Securities and Exchange Board of India(SEBI).

A separate section on Corporate Governance as followed by your Company and asstipulated under SEBI LODR Companies Act 2013 and relevant rules made there under formspart of the Annual Report. The requisite certificate from the Auditors of the Companyconfirming compliance with the conditions of the Corporate Governance is attached to theAnnual Report BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL

Board of Directors

There was no change in the composition of the Board of Directors during the reportingperiod howereverin accordance with the provisions of the Act and the Articles ofAssociation of the Company Mr. Suresh Kumar Agrawal(DIN: 00587623) Director of theCompany retire by rotation at the ensuing Annual General Meeting and being eligible haveoffered himself for re-appointment.

Key Managerial Personnel

Following persons are the Key Managerial Personnel of the Company pursuant to Section2(51) and Section 203 of the Act read with Rules framed thereunder:

1. Mr. Suresh Kumar Agrawal - Chairman

2. Mr. Saket Agrawal - Managing Director

3. Mr. DhananjayUchit Singh - Executive Director

4. Mr. Kamal Kumar Jain - Chief Financial Officer

5. Ms. Shreya Kar - Company Secretary

Remuneration and other details of the said Key Managerial Personnel for the financialyear ended March 312018 are provided in Form No. MGT-9 Extract of the Annual Returnwhich is set out at Annexure -2to the Director's Report.


The Board of Directors of your Company had constituted four committees for bestCorporate Governance Practices and in compliance with the provisions of the Companies Act2013 and SEBI LODR comprising of: Audit Committee Nomination and Remuneration CommitteeCorporate Social Responsibility Committee and the Stakeholders Relationship Committee.

A detailed note on composition of these Committees including number of meetings heldand attendance during the financial year have been disclosed separately in the CorporateGovernance Report section of this Annual Report.


Meetings of the Board of Directors are scheduled at regular intervals to discussdecide and approve on various business policies strategies financial performance andother matters. The schedule of the meeting are circulated in advance to ensure properparticipation of the Directors in the Meeting. The Board of Directors met eleven timesduring the financial year 2017-18. The intervening gap between the two consecutivemeetings did not exceed one hundred and twenty days as prescribed under Companies Act2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 .

Details of the meetings and attendance of the Board of Directors held during theFinancial Year 2017-18 are disclosed in Corporate Governance Report which form part ofAnnual Report.


In compliance with the requirements of SEBI Listing Regulations the Company has put inplace a familiarization programme for Independent Directors to familiarise them with theirrole rights and responsibility as Directors the operationsof the Company businessoverview etc.

The details of thPrograme can be access by weblink :


Pursuant to the provisions of the Companies Act 2013 and SEBI (LODR) Regulations2015 the Board has carried out an annual performance evaluation of its own performancethe directors individually as well evaluation of the working of its various Committees.The performance evaluation of all the Directors was carried out by the Nomination &Remuneration Committee. The performance evaluation of the Chairman and the Non-IndependentDirectors was carried out by the Independent Directors. Details pertaining to theevaluation process has been explained in the Corporate Governance Report annexed to theAnnual Report.


The Independent Directors of the Company should meet at least once during the yearpursuant to requirements of Schedule IV of the Companies Act 2013 and Regulation 25 ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. A meeting wasscheduled on 27.05.2017 without the attendance of non-independent directors and membersof the management interalia to:

a. Evaluation of performance of non-independent directors and the Board as a whole;

b. Evaluation of performance of the Chairman of the Company taking into accountthe views of Executive Directors and NonExecutive Directors;

c. assess the quality quantity and timeliness of flow of information between theCompany Management and the Board that is necessary for the Board to effectively andreasonably perform their duties;

d. report concerns about unethical behaviour actual or suspected fraud orviolation of the Company's code of conduct or ethical policy if any;and

e. ascertain and ensure that the Company has an adequate and functional vigilmechanism.


The term "Independent Director" as defined under section 149(6) of theCompanies Act 2013 and Regulation 16(b) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 forms the basis for determining independence of theDirectors. The Company has received necessary declarations from Mr. Kapil Deo Pandey Mr.NavneetJagatramka Mr. Ashok Kumar Soin and Mrs. Priyanka Tiwari Independent Directors ofyour Company that they meet the criteria of independence as laid down in Companies Act2013 read with Schedule IV and Rules made there under as well as

SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015


The policy of the Company on appointment and remuneration of Directors as formulated byNomination and Remuneration Committee includes criteria for determining qualificationspositive attributes independence of directors and remuneration for the directors andother perspective as laid down under section 178 of the Companies Act 2013 and SEBI LODRRegulations 2015.

As per the policy the Company should have optimum combination of executive andnon-executive directors with at least one woman director. As on 31st March 2017 theBoard consists of 8 Directors of which 6 are Non-Executive Directors including one womanindependent director. The Chairman being the Non-Executive Promoter Director your companycomprises of 4 Independent Director which is one-half of the total number of directors.

The details of the policy have been included in the Report on Corporate Governanceforming part of the Annual Report and also the same has been uploaded in Company's websitehttp://www .


In compliance with Section 135 read with Schedule VII of the Companies Act 2013 andrules made there under your Company has established Corporate Social ResponsibilityCommittee to formulate and monitor Corporate Social Responsibility Policy and also torecommend to the Board the amount of expenditure to be incurred on activities related tobetterment of society.

The Company is well aware of its responsibility towards the Society and hence in itsprevious years had taken efforts to improve the living condition in the vicinity of itsplants & surrounding areas. The Company had been continuing its efforts towards thebetterment of the society. The Board on the recommendation of CSR committee has formulateda policy on CSR to regulate the Company's activities amount to be spent on CSR etc

In terms with the Section 135 Companies Act 2013 read with Rule 8 of the companies(Corporate Social Responsibility) Rules 2014 and Rule 9 of the Companies (Accounts)Rules 2014 framed under the Company has to spent 2% of its average net profits of thepreceding three financial years for Corporate Social Responsibility activities due toloss incurred in the previous year and inadequate profit in the preceding three years theamount needed to be spend on CSR activities is inadequate. Irrespective of such situationof inadequate profit or loss your Company has spent Rs46.79 lacson CSR activities. Areport on Corporate Social Responsibility activities for the financial year 2017-18 isattached to this report as Annexure-3


All contracts or arrangements that were entered into by the Company with the relatedparties as defined under Section 177 of the Companies Act 2013 during the year were inthe ordinary course of business and on arm's length basis. All related party transactionsare placed before the Audit Committee for review and approval. Since all related partytransactions entered into by the Company were in the Ordinary course of business and wereon arm's length basis Form AOC-2 is not applicable to the Company. The routine relatedparty transactions was placed before the Audit Committee for their omnibus approval

The Company's policy on "materiality of related party transactions" and theprocess of dealing with such transactions are in line with the amended provisions of theCompanies Act 2013 and SEBI (LODR).

The said policy is also available on the website of the Company and the link for thesame is / related-party-transaction-policy.


In accordance with the provisions of section 134(5) of the Companies Act 2013 yourDirectors hereby confirms:

(a) that in the preparation of the annual accounts for the FY 2017-18 theapplicable Accounting Standards (IND AS) had been followed along with proper explanationrelating to material departures;

(b) that the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year ended 31st March 2018 and of the loss of the company for that period;

(c) that the directors has taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

(d) that the directors has prepared the annual accounts on a going concern basis;

(e) that the directors has laid down internal financial controls to be followed bythe company and that such internal financial controls are adequate and were operatingeffectively; and

(f) that the directors has devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.


In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended from time to time there are no employees who have drawn remuneration in excess ofthe limits set out in the said rules.

Disclosures relating to the Remuneration under Section 197(12) of the Companies Act2013 read with Rules 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are provided as Annexure-4 to this report.


The relevant information as required under sub-section (3)(m) of Section 134 of theCompanies Act 2013 read with Companies (Accounts) Rules 2014 are given in Annexure-5 tothe Board's Report

AUDITORS Statutory Auditors

In terms of Section 139 of the Companies Act 2013 M/s. Singhi & Co. CharteredAccountants (Firm Registration No. 302049E) were appointed as Statutory Auditors of theCompany for a tenure of 1 year by the Members to hold the office from the conclusion ofthe 49th Annual General Meeting until the conclusion of the 50th Annual General Meeting tobe held the Financial Year 2018-19.

As required under Section 139 of the Companies Act 2013 the Company has obtained awritten consent from the Auditors along with a certificate from them to the effect thattheir appointment is in accordance with the conditions prescribed under the Companies Act2013 and rules made thereunder.

Explanation to Auditor's Comments

The Notes on Financial Statement referred to in the Auditor's Report areself-explanatory and do not call for any further comments. The Auditor's Report does notcontain any qualification reservation adverse remarks or check when wereceive the final audit report from Singhi & Co. (CARO)

Internal Auditor

Pursuant to Section 138 of the Companies Act 2013 your Company has appointed M/s B.Chhawchharia& Co. as Internal Auditor of the Company to conduct internal audit of thefunctions and activities of the Company to audit for the period April 2018 to March 2019.Internal Auditor to change. - S.K. Agrawal & Co.

Cost Auditor

As per the Section 148 of the Companies Act 2013 read with the Companies (Cost Recordsand Audit) Amendments Rules 2014 the Company is required to get its Cost Audit done byCost Accountant in practice every financial year.

The Board of Directors on the recommendation of Audit Committee appointed Mr. SambhuBanerjee Cost Accountant (Membership No. 9780) to conduct the audit of the cost accountsof the Company for the financial year 2018-19.

As per the provisions of the Companies Act 2013 the remuneration payable to the CostAuditors is required to be placed before the members in a General Meeting for theirratification. Accordingly a resolution seeking members' ratification for the remunerationpayable to Mr. Sambhu Banerjee Cost Accountants is included in the notice convening the49th Annual General Meeting.

Secretarial Auditor

Secretarial Audit for the financial year 2017-18 was conducted by M/s. PS AssociatesPracticing Company Secretaries (C.P. No.:3502) as required under section 204 of theCompanies Act 2013 read with relevant Rules made there under. The Secretarial AuditReport for FY 2017-18 is annexed herewith as Annexure-6.The Report does not contain anyqualification reservation or adverse remarks.

The Board of Directors has re-appointed M/s PS Associates Practicing CompanySecretaries (C.P. No.:3502) as Secretarial Auditor for conducting the Secretarial Auditof the Company for the Financial Year 2018-19


Your Company has an effective and robust Risk Management Frameworkwhich would enabletimely identification of risks assessment and evaluation of the same in line with theoverall objectives and set adequate mitigation strategy. The Risk Management Framework isreviewed by the Board and Audit Committee on a periodical basis to oversee that all thecritical risk areas that the organisation faces have been identified and assessed andthere is an adequate risk management mechanism in place capable of addressing those risks.Further details on Risk Management Policy are briefed out in the Management Discussionand Analysis Report forming a part of this Annual Report.


The Company has in place adequate Internal Financial Control commensurate with thesize scale and complexity of its operation. The Directors of the Company have beenentrusted with the overall responsibility to implement and operate the internal financialcontrols adequately and effectively. The Company has devised appropriate systems andframeworks including proper delegation of authority ensuring orderly and efficientconduct of business adherence to policies and procedures effective IT system includingERP application aligned to business requirements risk management framework and whistleblower mechanism. This provides the Directors with the reasonable assurance review andcontrol mechanisms.


The Company has implemented whistle blower policy/vigil mechanism as envisaged inCompanies Act 2013 and SEBI LODR to enable directors employees and stakeholders reportabout any wrongful conduct unethical/illegal practices or that could have grave impact onthe operations and performance of the business of the Company or any other matter thatmight cause financial/non- financial loss to the director/employee of the Company or mightimpact their goodwill. The details of the Whistle Blower Policy are provided in theCorporate Governance Report and is also available at on the website of the Company at policy.


The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof Sexual Harassment of Women at Workplace (Prevention Prohibition & Redressal) Act2013. The objective of the policy is to prohibit prevent and address issues of sexualharassment at the workplace.MSPL has established suitable mechanisms to ensure issuesrelated to sexual harassment are effectively addressed. MSPL believes in providingfavorable working environment devoid of discrimination and harassment. Sexual harassmentis a form of misconduct that undermines the employment relationship. This policy hasstriven to prescribe a code of conduct for the employees and all employees have access tothe Policy document and are strictly required to abide by it.. Sexual harassment at thework place or other than work place if involving employees is a grave offence and istherefore punishable. During the year under review no complaints were reported to theBoard.

A Committee has been constituted by the Management to consider and redress complaintsof Sexual Harassment. The Chairman and Members of the Committee are as follows:

Position Officer in-charge
Presiding Officer Ms. Shreya Kar
Member - Mr. Kamal Kumar Jain
Member - Mr. P.K Dey
Member - Ms. Mita Das


An extract of annual return named as provided under sub-section 3 of Section 92 and inline with Section 134(3)(a) of the Companies Act 2013 MGT-9 has been annexed to theDirector's Report as Annexure-2


There are no such significant or material orders passed by the regulators or courts ortribunals impacting the going concern status of the company's operation in future.


The Company and its Registrar M/s. Bigshare Services Private Limited who is lookingafter the physical as well as Demat work and also shareholders correspondence in terms ofSEBI direction for having a common Registrar and Share Transfer Agent endeavored theirbest to service the Investors satisfactorily.


During the year under review your Company was recognized in various ways/by variousinstitutions and some of the awards presented to the Company are listed below:

The said awards and recognition is also available in the Company's website


Statement in the Board's Report and the Management Discussion & Analysis reportdescribing the Company's Objectives expectation and forecast may be forward lookingwithin the meaning of applicable securities laws and Regulations. Actual result may differmaterially from those expressed in the statement important factors that may influence thatcompany's operational include global and domestic demand and supply conditions &selling prices of finished goods input availability and prices changes in governmentregulating tax laws economic developments within the country and other parts.


Your directors take this opportunity to express their deep and sincere gratitude toshareholders customers dealers agents suppliers investors bankers for theircontinued support and faith during the year. Your Directors place on record a deep senseof appreciation for the commitment shown by the employees at all levels whose contributionwas significant to the growth of the Company.

Your directors also thank for the valuable guidance and support given by the Governmentof India various State Government Departments Ministry of Corporate Affairs Income TaxAuthority and all other regulatory authorities for their assistance and cooperation duringthe year and look forward for the same in the future.

For and behalf of the Board


Date: 14th August 2018
Place: Kolkata
Suresh Kumar Agrawal Manish Agrawal
DIN:00587623 Din: 00129240