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Narayani Steels Ltd.

BSE: 540080 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE715T01015
BSE 00:00 | 06 Apr Narayani Steels Ltd
NSE 05:30 | 01 Jan Narayani Steels Ltd
OPEN 9.87
PREVIOUS CLOSE 9.87
VOLUME 32462
52-Week high 37.50
52-Week low 6.95
P/E 32.90
Mkt Cap.(Rs cr) 11
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 9.87
CLOSE 9.87
VOLUME 32462
52-Week high 37.50
52-Week low 6.95
P/E 32.90
Mkt Cap.(Rs cr) 11
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Narayani Steels Ltd. (NARAYANISTEELS) - Director Report

Company director report

To

The Members

Narayani Steels Limited.

A Corporate Insolvency Resolution Process has been initiated against Narayani SteelsLimited (the Company) vide an order Kolkata Bench of National Company Law Tribunal (NCLT)dated 24th March2021 under the provision of the Insolvency and BankruptcyCode 2016. The honorable NCLT Kolkata bench order dated 24.03.2021 has appointed Mr. KrishnaKomaravolu IP Registration no. IBBI/IPA-002/IP-N00562/2017-18/11699 as InterimResolution Professional(‘IRP’) for carry out the Corporate Insolvency ResolutionProcess (CIRP) of the Company. At 1st Meeting of Committee of Creditors of theCompany held on 23 April 2021 his appointment was confirmed as Resolution Professional.

In terms of Section 17 of the Code on commencement of the Corporate InsolvencyResolution Process (CIRP) the powers of the Board of Directors of Narayani Steels Limitedstands suspended and the same are being exercised by the Resolution Professional. Themanagement of the affairs of Narayani Steels Limited has been vested with ResolutionProfessional. In View of the abovementioned provisions of Law since the Powers of Board ofDirectors stands Suspended and be exercised by the Interim Resolution Professional theDirectors Report which is required to be presented by Board of Directors under Section134(3) Companies Act 2013 is not being presented. However a report of Managementcontaining the Details and information as available to be disclosed in Directors Report tothe shareholders is being presented to you by Resolution Professional.

1. FINANCIAL SUMMARY OF THE COMPANY:

(Rs. in Amount)

Standalone Consolidated
Particulars For the year ended 31.03.2021 For the year ended 31.03.2020 For the year ended 31.03.2021 For the year ended 31.03.2020
Total Revenue including other income 828429258 3623627845 828429258 3623627845
Total Expenses 1629018789 4104153698 1629018789 4104153698
Profit/(Loss) before tax -800589531 -480525853 -800589531 -480525853
Exceptional Item- - - - -
Tax Expenses -280912393 -167373701 -280912393 -167373701
Profit/(Loss) after tax -519677138 -313152152 -519677138 -313152152
EPS Weighted Average
-Basic (Rs.) -47.64 -28.71 -47.64 -28.71
-Diluted (Rs.) -47.64 -28.71 -47.64 -28.71

2. STATE OF COMPANY’S AFFAIRS UNDER CLAUSE (i) TO SUB-SECTION (3) OFSECTION 134 OF THE COMPANIES ACT 2013:

a) FINANCIAL SUMMERIES

STANDALONE:

During the year under review the Company has recorded a Total Revenue of Rs.8284.29Lakhs as compared to the previous year Total Revenue of Rs. 36236.27 Lakhs. The TotalExpenditure incurred the year was Rs. 162.90 Lakhs as against the amount of Rs. 41041.53Lakhs during the previous year. The profit/(Loss) before tax and Tax Expenses during theyear were Rs. -8005.89 Lakhs and Rs. 2809.12 Lakhs as compared to the profit/(Loss) beforetax and Tax Expenses provided for the previous year were -4805.25 Lakhs and Rs. -1673.73Lakhs respectively. Hence the Company has earned a Net Loss of Rs. -5196.77 Lakhs ascompared to the previous year loss amount of Rs. -3131.52 Lakhs.

CONSOLIDATED:

During the year under review the Company has recorded a Total Revenue of Rs.8284.29Lakhs as compared to the previous year Total Revenue of Rs. 36236.27 Lakhs. The TotalExpenditure incurred the year was Rs. 162.90 Lakhs as against the amount of Rs. 41041.53Lakhs during the previous year. The profit/(Loss) before tax and Tax Expenses during theyear were Rs. -8005.89 Lakhs and Rs. 2809.12 Lakhs as compared to the profit/(Loss) beforetax and Tax Expenses provided for the previous year were -4805.25 Lakhs and Rs. -1673.73Lakhs respectively. Hence the Company has earned a Net Loss of Rs. -5196.77 Lakhs ascompared to the previous year loss amount of Rs. -3131.52 Lakhs.

(b) CHANGE IN THE NATURE OF BUSINESS IF ANY:

There are no changes in the nature of business of the Company during the Financial Year2020-21.

3. EXTRACT OF THE ANNUAL RETURN:

As required under Clause (a) to Sub-section (3) of Section 134 of the Companies Act2013 the extract of Annual Return in form MGT-9 as provided under Sub-section (3) ofSection 92 of the Companies Act 2013 and Rule 12(1) of the Companies (Management andAdministration) Rules 2014 is enclosed in Annexure-2.

4. AUDITORS:

A) STATUTORY AUDITORS:

M/s. Ramamoorthy (N) & Co Chartered Accountants Visakhapatnam (FRN:002899S)appointed as Statutory Auditors to conduct Statutory Audit of Company.

B) COST AUDITORS.

M/s. A.S. Rao & Co. Cost Accountants Hyderabad was appointed as Cost Auditors ofthe Company to conduct the audit of Cost Accounts maintained by the Company. The Companyhas received the Cost Audit Report from the Cost Auditor for the FY 2020-21.

C) SECRETARIAL AUDITORS:

The Company has appointed M/s. ASN Associates Practicing Company Secretaries or anyother Company Secretary Farm to conduct Secretarial Audit for the Financial Year 2021-22.The Secretarial Audit Report for the Financial Year ended March 31 2021 is annexedherewith to this Report.

5. PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES ASSOCIATESAND JOINT VENTURE COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT: HariEquipments Private Limited (Associate Company)

During the Financial Year 2020-21 its Associate Company i.e Hari Equipments PrivateLimited has total income Rs. 26949118/- as compared to Rs. 217521700/- in theprevious Financial Year and its profit after tax in 2020-21 is R.-88278751/- as compareto Rs.-74361523/- in previous Financial Year. Details of Associate Company mentioned in(Annexure-3)

6. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW:

During the F.Y. 2020-21 the Board of Directors met for 14 (Fourteen) times to discussabout the business and other important matters relating to the Company which forms part ofthis report. The details of which are given in Annexure-1. The intervening gap between theMeetings was within the period prescribed under the Companies Act 2013.

7. RESOLUTION PROFESSIONAL/DIRECTORS RESPONSIBILITY STATEMENT:

In accordance with the provisions of Sub-section (5) of Section 134 of the CompaniesAct 2013 the Director/Resolution Professional hereby confirm that:

(a) in the preparation of the Annual Accounts the applicable Accounting Standards hadbeen followed along with proper explanation relating to material departures; (b) they haveselected such Accounting Policies and applied them consistently and made judgments andestimates that are reasonable and prudent so as to give a true and fair view of the stateof affairs of the Company at the end of the Financial Year and of the profit and loss ofthe Company for that period;

(c) they have taken proper and sufficient care for the maintenance of adequateAccounting Records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

(d) they have prepared the Annual Accounts on a Going Concern basis;

(e) the Company being listed Company Sub-clause (e) to Sub-section (5) of Section 134of the Companies Act 2013 pertaining to laying down Internal Financial Controls isapplicable to the Company; and

(f) they have advised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

8. COMPANY’S POLICY RELATING TO DIRECTOR’S APPOINTMENT PAYMENT OFREMUNERATION

INCLUDING DISCHARGE OF THEIR DUTIES AND OTHER MATTERS:

The Company is covered under Sub-section (1) of Section 178 Nomination &Remuneration Committee has devised and implemented a Nomination and Remuneration Policyfor Director’s appointment and remuneration including criteria for determiningqualifications positive attributes independence of a Director and other matters providedunder Sub-section (3) of Section 178 of Companies Act2013

9. EXPLANATION OR COMMENTS ON QUALIFICATIONS RESERVATIONS OR ADVERSE REMARKS ORDISCLAIMERS MADE BY THE AUDITORS AND COMPANY SECRETARY IN PRACTICE IN THEIR REPORTS UNDERCLAUSE (f) TO SUB-SECTION (3) OF SECTION 134 OF THE COMPANIES ACT 2013:

As required under Clause (f) to Sub-section (3) of Section 134 of the Companies Act2013 the explanation or comments on qualifications reservations adverse marks ordisclaimers made by the Auditors in their reports.

10. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013:

Company has complied with the provisions of Section 186 of the Companies Act2013

11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO INSUBSECTION (1) OF SECTION 188 IN THE PRESCRIBED FORM:

No Material Related Party Transactions i.e. transactions exceeding 10% of the annualconsolidated turnover as per the last audited financial statement were entered during theyear by your Company. Accordingly the disclosure of Related Party Transactions asrequired under Section 134(3)(h) of the Companies Act 2013 in Form AOC-2 is notapplicable

12. THE AMOUNTS IF ANY WHICH IT PROPOSES TO CARRY TO ANY RESERVES UNDER CLAUSE (j) TOSUBSECTION (3) OF SECTION 134 OF COMPANIES ACT 2013:

During the Financial Year 2020-21 the Company has not transferred any amount to itsReserves.

13. THE AMOUNT IF ANY WHICH IT RECOMMENDS SHOULD BE PAID BY WAY OF DIVIDEND UNDERCLAUSE

(k) TO SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT 2013:

Your Company not recommended any dividend in view of the sluggish market conditionsprevalent in the Steel Industry.

14. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT:

A CIRP has been initiated against the Company vide an order of Kolkata bench of theNCLT dated March 24 2021 under the provisions of the Code. The Hon’ble NCLT KolkataBench by order Dated 24th March 2021 has appointed Mr. Krishna Komaravolu as an‘IRP’ for carrying out the Corporate Insolvency Resolution Process (CIRP) of theCompany.

15. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGOIN SUCH MANNER AS MAY BE PRESCRIBED UNDER CLAUSE (m) TO SUB-SECTION (3) OF SECTION 134 OFCOMPANIES ACT 2013:

The particulars as prescribed under Clause (m) to Sub-section (3) of Section 134 of theCompanies Act 2013 read with Companies’ (Accounts) Rules 2014 regardingConservation of Energy Technology Absorption and Foreign Exchange Earnings/ Outgo isprovided as under:

(a) Conservation of Energy:

(i) The steps taken or impact on conservation of energy To improve the Power Factor upto 0.99.
(ii) The steps taken by the company for utilizing alternate sources of energy 125 KVA DG power is used whenever APEPDCL power fails.
(iii) The capital investment on energy conservation equipments Power Capacitors.

(b) Technology Absorption:

(i) The efforts made towards technology absorption Spectrometer of Oxford and MK for In-house testing lab.
(ii) The benefits derived like product improvement cost reduction product development or import substitution Saved expenses on testing from Outside agencies.
(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year)-
(a) the details of technology imported -
(b) the year of import; -
(c) whether the technology been fully absorbed -
(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof -
(iv) The expenditure incurred on Research and Development -

(c) Foreign Exchange Earnings /Outgo:

Particulars 2020-21 2019-2020
(Rs.) (Rs.)
Foreign Exchange Earnings Nil Nil
Foreign Exchange Outgo
Interest on Buyers' Credit Loan Nil Nil
Import of Traded Goods Nil Nil
Travel and Miscellaneous Matters Nil Nil

16. STATEMENT INDICATING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY FORTHE COMPANY AS REQUIRED UNDER CLAUSE (n) TO SUB-SECTION (3) OF SECTION 134:

The Company has devised and implemented a Risk Management Policy and all the risks arediscussed at the Senior Management Level at their Meetings periodically to ensure that therisk mitigation plans are well thought out and implemented and adverse impact of risks isavoided or kept within manageable proportions though the elements of risk threatening theCompany’s existence are very minimal. This policy are mentioning inhttps://narayanisteels.co.in/investors/polices/

17. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIALRESPONSIBILITY INITIATIVES TAKEN DURING THE YEAR UNDER CLAUSE (o) TO SUB-SECTION (3) OFSECTION 134 OF COMPANIES ACT 2013:

The provisions of Section 135 of the Companies Act 2013 read with the Companies(Corporate Social Responsibility Policy) Rules 2014 are not applicable to the Company.

18. FORMAL ANNUAL EVALUATION:

statement on Formal Annual Evaluation of performance of the Board its Committee and ofIndividual Directors has been made.

19. VIGIL MECHANISM POLICY:

Pursuant to the provisions of Sub-section (9) & (10) of Section 177 of theCompanies Act 2013 a Vigil Mechanism Policy for Directors and Employees to reportgenuine concerns has been established. The Company has also provided adequate safeguardsagainst victimization of Employees and Directors who express their concerns. The VigilMechanism Policy has been uploaded on the website of the Company athttps://narayanisteels.co.in/investors/polices/

20. SECRETARIAL AUDIT REPORT:

The provisions relating to Secretarial Audit under Section 204 of the Companies Act2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 areapplicable to the Company as the turnover exceeds Rs. 2500000000/- and the same isenclosed as Annexure-5.

21. DEPOSITS:

The Company has neither accepted nor renewed any deposits during the year under reviewwithin the meaning of Section 73 of the Companies Act 2013 and the Companies (Acceptanceof Deposits) Rules 2014.

22. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR

TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE:

As stated hereinbefore the Hon’ble National Company Law Tribunal Kolkata (NCLTKolkata) vide order dated 24th March 2021 approved initiation of Corporate InsolvencyResolution Process of the Company pursuant to an application under section 7 of theInsolvency and Bankruptcy Code 2016 filed by ICICI Bank.

Pursuant to the initiation of the above proceedings and in terms of SEBI (ListingObligations and Disclosure Requirements) (Third Amendments) Regulations 2018 dated 31stMay 2018 that after the Commencement of Corporate Insolvency Resolution Process (CIRP)allthe powers of the Board or Committees shall be fulfilled by Resolution Professional inaccordance with sections 17 and 23 of Insolvency and Bankruptcy Code 2016 and powers ofthe Board of Directors stand suspended the powers of the Board / Committees have beensuspended in terms of section 17 of the said Code and the same now vest with Mr. KrishnaKomaravolu IP Registration no. IBBI/IPA-002/IP-N00562/2017-18/11699 the ResolutionProfessional.

23. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS:

The Company has established an internal control over financial reporting criteriaconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India.

Also as per the Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 issued by the Independent Auditorsof the Company the Company has in all material respects an adequate internal financialcontrols system over financial reporting and such internal financial controls overfinancial reporting were operating effectively.

24. THE BOARD AND KMP.

a) Change in the Composition of the Board of Directors& KMP:

No change has been occurred during the Financial Year 2020-21 except appointment ofMrs Swarnalath Mandaleeka Prakash Kumar Thakur Rabi Kumar Gupta and resignation of Mrs.Jaya Padmavathi Bandi & Bhaskararao Puvvala. Details of Senior Executive and KMP areshown in our website: www.narayanisteels.co.in

b) Details of composition of audit committee as per section 177(8) of the companiesact2013

Before passing the Order by NCLT Kolkata The Composition of Audit Committee was. asunder:

Sr. No Particulars Designation
01 Eunny Krishnamacharyulu Chairman
02 Prakash Kumar Thakur member
03 Rabi Kumar Gupta member

After the Commencement of Corporate Insolvency Resolution Process (CIRP) as perregulation 17 of IBC "the Code" The management of the affairs of the companyshall vested in the interim resolution professional and the power of the board ofdirectors/ committees shall stand suspended and be exercised by the Interim ResolutionProfessional.

25. PARTICULARS OF EMPLOYEES:

There were no permanent employees during the year under review whose particulars arerequired to be given in this Board’s Report in accordance with the provisions ofSection 197 of the Act read with Rule 5(1) & 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 as amended from time to time. Theremuneration paid to Directors and Key Managerial Personnel of the Company during theFinancial Year 2020-21 was in accordance with the Nomination and Remuneration Policy ofthe Company.

26. DECLARATION GIVEN BY INDEPENDENT DIRECTORS:

The statement on Declaration to be given by Independent Directors under Sub-section (6)of Section 149 of Companies Act 2013 and Companies Appointment and Qualification ofDirectors) Rules 2014 as required under Clause (d) to Sub-section (3) of Section 134 ofthe Companies Act 2013

27. INSURANCE:

All the assets of the Company wherever necessary and to the extent required have beenadequately insured.

28. EMPLOYEE RELATIONS:

During the year the Employee relations in the Company remained cordial and highlyconducive to congenial working environment in all its establishments and further theCompany has been in touch relating to recruitment of required personnel from time to time.

29. A DISCLOSURE AS TO WHETHER MAINTENANCE OF COST RECORDS AS SPECIFIED BY THE CENTRALGOVERNMENT UNDER SUB-SECTION (1) OF SECTION 148 OF THE COMPANIES ACT 2013:

Maintenance of cost records as specified by the central government undersub-section (1) of section 148 of the companies act 2013 is required by the company andaccordingly such accounts and records are made and maintain.

30. INTERNAL COMPLAINTS COMMITTEE:

Company has complied with provision relating to the constitution of InternalComplaints Committee under sexual harassment of women at workplace (preventionprohibition and redressal) Act 2013

31. MANAGEMENT DISCUSSIONS AND ANALYSIS:

The Board has been continuing its efforts and taken the required steps in the area ofIndustry structure and Development Growth Strategy Segment-wise Performance InternalControl Systems and their adequacy Analysis of Strengths Weaknesses Opportunities andThreats Financial Performance with respect to Operational Performance Materialdevelopments in human resources / industrial relations Strict Compliances TalentManagement Leadership Development and Talent Retention Learning and Development.

32. ACKNOWLEDGEMENTS:

The Resolution Professional / Directors would like to express their sincereappreciation for the assistance and cooperation received from the financial institutionsbanks Government authorities customers vendors and members during the year underreview. The Resolution Professional / Directors also wish to place on record their deepsense of appreciation for the dedication of the employees at all levels which has beenrequire for the Company’s success. The Directors/Resolution Professional of theCompany look forward to their continued support in future.

By Order of the Resolution Professional

Narayani Steels Limited

(A Company under Corporate Insolvency Resolution Process)

Date:03.09.2021

Vizanagaram

(Sunil Choudhary)

Managing Director

DIN:00289479

(Ankit Gupta)

Director and Chief Financial Officer

DIN: 08415248

(Narayani Steels Limited is under Corporate Insolvency Resolution Process under theInsolvency and Bankruptcy Code 2016. Its affairs business and assets are being managedby the Resolution Professional Mr.

Krishna Komaravolu IP Registration no. IBBI/IPA-002/IP-N00562/2017-18/11699appointed as Interim Resolution Professional by the National Company Law Tribunal by orderdated 24th March 2021 and continued as Resolution Professional by the Committee ofCreditors in its meeting held on 23 April 2021 under provisions of the code.)

.