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RHI Magnesita India Ltd.

BSE: 534076 Sector: Engineering
NSE: RHIM ISIN Code: INE743M01012
BSE 00:00 | 30 Sep 670.25 19.00






NSE 00:00 | 30 Sep 669.95 19.05






OPEN 659.65
VOLUME 35644
52-Week high 701.00
52-Week low 322.70
P/E 35.98
Mkt Cap.(Rs cr) 10,791
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 659.65
CLOSE 651.25
VOLUME 35644
52-Week high 701.00
52-Week low 322.70
P/E 35.98
Mkt Cap.(Rs cr) 10,791
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

RHI Magnesita India Ltd. (RHIM) - Director Report

Company director report

To the Members

The Directors present the Annual Report of RHI Magnesita India Limited (formerly knownas Orient Refractories Limited) (the Company or RHIM) along with the audited financialstatements for the financial year ended 31 March 2021. The consolidated performance of theCompany and its subsidiaries has been referred to wherever required.


(Amount in Rs. Lacs)




2020-21 2019-20* 2020-21 2019-20
Gross revenue from operations 136641.31 138399.13 137037.86 138758.56
Total expenditure before finance cost and depreciation 115864.22 117065.04 116184.5 117365.83
Operating Profit 20777.09 21334.09 20853.36 21392.73
Add: Other income 1203.56 1017.59 1232.39 1035.84
Profit before finance cost depreciation exceptional items and taxes 21980.65 22351.68 22085.75 22428.57
Less: Finance costs 648.31 1230.13 648.31 1230.13
Profit before depreciation exceptional items and taxes 21332.34 21121.55 21437.44 21198.44
Less: Depreciation 2961.33 2604.00 2979.48 2617.67
Profit/(Loss) before exceptional items & tax 18371.01 18517.55 18457.96 18580.77
Add/(Less): Exceptional Items - - - -
Profit before taxes 18371.01 18517.55 18457.96 18580.77
Less: Tax Expense 4775.55 4890.5 4795.63 4992.24
(A) Profit/(Loss) after taxes 13595.46 13627.05 13662.33 13588.53
(B) Total other comprehensive income 7.26 -107.76 7.26 -107.76
(C) Total comprehensive income for the period [A + B] 13602.72 13519.29 13669.59 13480.77
Retained Earnings: Balance brought forward from the previous year 52116.49 42218.05 52077.97 42218.05
Add: Profit for the period 13595.46 13627.05 13662.33 13588.53
Add: Other Comprehensive Income recognised in Retained Earnings 7.26 -107.76 7.26 -107.76
Balance Which the Directors have apportioned as under to:
(i) Dividend on Ordinary Shares 3421.16 3003.48 3421.16 3003.48
(ii) Tax on dividends 617.37 617.37
Total Appropriations 3421.16 3620.85 3421.16 3620.85
Retained Earnings: Balance to be carried forward 62298.05 52116.49 62326.40 52077.97

*Pls. refer notes 4.


Revenue from operation has decreased by 1.27 % to Rs 136641.31 lacs in current year incomparison to Rs 138399.13 lacs in previous year. Profit after tax (PAT) on revenuedecreased by 0.23 %. PAT in current year Rs. 13595.46 lacs in comparison to Rs 13627.05lacs in previous year. In current year the PAT was 9.95% which is higher as compared to9.85% previous year.


The Board of Directors has decided to retain the entire amount of profits in theprofit and loss account.


On 31 July 2018 the Board of Directors of the Company and its fellow subsidiariesi.e. RHI India Private Limited (the ‘RHI India’) and RHI Clasil Private Limited(the ‘RHI Clasil’) (hereinafter referred as ‘erstwhile fellowsubsidiaries’) had granted its in-principle approval to the scheme of amalgamationof RHI India and RHI Clasil with and into the Company with the proposed appointed date of1 January 2019 or such other date as may be fixed by the Tribunal (‘theScheme’).

The Scheme was filed before the National Company Law Tribunal Mumbai(‘NCLT’) and was rejected by them vide order dated 2 March 2021.

An appeal was filed before the Hon’ble National Company Law Appellate Tribunal(‘NCLAT’) and NCLAT vide its judgement dated 19 January 2021 allowed the saidappeal and directed the NCLT to approve the said Scheme with an appointed date of 31 July2018.

The NCLT vide its Order dated 5 May 2021 has approved the Scheme with an appointed dateof 31 July 2018 in view of the order passed by the NCLAT.

On 11 June 2021 the Board of Directors of the Company took on record the sanction ofthe Scheme by the NCLT change in the authorised share capital and have fixed the recorddate as 24 June 2021 for the purpose of determining the shareholders of its erstwhilefellow subsidiaries who shall be entitled to receive the shares of the Company.

The Company has prepared these Standalone Financial Statements after considering effectin accordance with clause 3.7 of the Scheme which requires the accounting treatment to becarried out as prescribed under applicable accounting standards that is from thebeginning of the preceding year and in accordance with Ind AS 103 Business Combination.The corresponding figures in these Standalone Financial Statements have been preparedbased on the audited financial statements of the Company and its erstwhile fellowsubsidiaries as adjusted for giving effect to the Scheme as approved by the NCLT.

Pursuant to the Scheme becoming effective the authorised share capital of the Companyhas been increased from Rs. 1205 lacs to Rs. 3080 lacs.

As a consideration of the merger of the Company with the erstwhile fellow subsidiariesthe Company on 25 June 2021 issued and allotted 40857131 equity shares of Re. 1/- eachfully paid up to the shareholders of the erstwhile fellow subsidiaries.

After the issuance and allotment of the equity shares to the shareholders of itserstwhile fellow subsidiaries paid up share capital of the Company has been increasedfrom Rs. 1201.39 lacs to Rs.1609.96 lacs. After above said allotment of shares the newshareholding pattern of the Company is.

Particulars No. of Shares %'age of Paid-up Capital
Promoters 113002465 70.19
- Dutch US Holding B.V. 79877771 49.61
- Dutch Brasil Holding B.V. 20620887 12.81
- VRD Americas B.V. 12503807 7.77
Public 47993866 29.81
Total Paid up Capital 160996331 100.00

The Company on 7 July 2021 applied with BSE Limited and National Stock Exchange ofIndia Limited for in-principle approval for listing of above said 40857131 equityshares.


The name of the Company w.e.f. 2 July 2021 changed from Orient Refractories Limitedto RHI Magnesita India Limited. The change of name was approved by the Board of Directorsof the Company at their meeting held on 11 June 2021 pursuant to and as per the terms ofthe Scheme of Amalgamation amongst RHI India Private Limited RHI Clasil Private Limitedand Orient Refractories Limited as approved and sanctioned by Hon’ble NationalCompany Law Tribunal Mumbai Bench Mumbai in accordance with provisions specified underthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended from time to time. The Registrar of CompaniesMumbai Maharashtra approved the name and issued a new certificate of incorporation on 2July 2021.

The shares of the Company have commenced trading on BSE Limited and National StockExchange of India Limited with the new name "RHI Magnesita India Limited" withscrip code "RHIM" with effect from July 22 2021.


Covid- 19 first wave started showing its impact from March’2020 which tookaway the growth of first two months of 2020. The first two months raised the hope both inservices and manufacturing sector but COVID-19 pandemic impacted Indian economynegatively. A nationwide lockdown was declared on 24 March 2020 & extended till June2020. All socio- economic activities came to a standstill.

The Q1/2020 has very badly impacted the production demand supply and consumption inall the major economies. All the sectors were badly hit and faced supply and logisticsproblem. Indian steel production and imports were declined in the month of April andMay’ 2020. Government announced the financial stimulus of Rs. 20 trillion which hasmitigated the economic fall out to some extent due to pandemic.

RHIM has responded well to the challenges presented by COVID-19 in Q1 2020. The Companymaintained production capabilities and supply chains to support customers whilst aboveall protecting health of employees customers and business partners. The Company reactedquickly to reduced customer demand by successfully managing costs and cash in the shortterm. Whilst revenues and profits are down materially in Q1/2020 despite RHIM hasmaintained good operating margins and positive operating cash flow. The Company tooknumber of key initiatives to further improve for the longer term business processes andoverall cost effectiveness. This has helped us to regain the profitability in Q2/2020 andbeyond. COVID second wave has affected most part of the India and cases went upto400 k plus in May’2021 end. In June’2021 there is some respite and cases camedown to 70 K per day. Q1/2021 steel production was affected due to manpower issues as wellas restriction imposed by the Government on mobility of vehicles. Now the cases are ondown trend we are expecting less or no restrictions in Q2/2021.The long-term economicimpact of COVID-19 remains uncertain. However the business is taking appropriate actionsto withstand an extended period of uncertainty. With significant financial strength RHIMis well positioned to take advantage of growth opportunities when markets improve and willexit this period of disruption with positive strategic momentum.


The Company has taken appropriate measures to ensure safety and health of all itsemployees and ensured due compliance with various directives issued by Central State andMunicipal authorities. The Company has adopted Work from home for its office-basedemployees effective mid of March’2020 to minimize the risk. Consequent to thelock-down orders issued by Central and State Governments the operations have beendisrupted from 24 March 2020 at both the Plants situated at

Bhiwadi Rajasthan Cuttack Orrisa Vizag and across different sites facilities anddistribution centres as per the directives applicable to them. To meet the customersrequirement and uninterrupted supplies the Company started dispatches of the finishedgoods from 20 April 2020 and after obtaining requisite permission from concerned districtadministration the Company has resumed their limited operation from 8 May 2020 at allPlants in compliance with all the safety guidelines/ directives issued by the Central/State Governments and local administration to safeguard the employees labourers and allother stakeholders to prevent the spread of COVID-19. The Company has promoted vaccinationdrive for its employees across the India and distributed the Covid-19 preventive kits tothe local communities. The Company has tied up with the local hospitals to help thecommunity in this pandemic. Company has taken lot of actions to protect the health ofemployees and for the public through their CSR initiatives.


RHIM is in the business of manufacturing and marketing special basic and non-basic refractory products systems and services to the steel industry in India andGlobally. The Company is market leader for refractories in India and has many globalcustomers for its international quality products. The Company’s produces nearly130000 tons of refractory per annum including customized products and system solutions.Other than this RHIM imports significant value of refractory products which are used forfull line contracts in steel industries. The refractory products are mainly used in hightemperature manufacturing processes in iron and steel industry metal smelters cementglass industry and for other industrial products. Demand for refractory is primarilydependent on the consumption of steel which accounts for about 75% of the total value andthe remaining is used for glass cement non-ferrous petrochemicals etc.

Products of RHIM are manufactured at its state-of-the-art manufacturing facility atBhiwadi in Rajasthan & Tangi in Orissa and in Vishakhapatnam. The Company has ongoingprograms for improving efficiency and effectiveness of its manufacturing processes rawmaterial cost energy conservation control over working capital and to produce specialrefractories at low cost so as to add maximum value to the customers. Energy efficientinstallations have been made at the factories. Best in class safety measures and processeshave been put in place and improved upon at the factories and all working sites.

The products of the Company are of Global standards in quality and highly costcompetitive which makes it attractive for the customers worldwide.

Industry overview

Review of Global Steel Industry and outlook

As per World Steel Association (WSA) Global crude steel production reached 1864.0Million Tonnes (MT) for the year

2020 down by 0.9% compared to 2019 with maximum share of China almost half of totalworld’s production. Forecasts for the global steel demand to grow by 5.8% in the year2021 primarily supported by a robust consumption growth of 9.1% in China and bysubstantial fiscal stimulus measures in most of the advanced economies. Asia produced1374.9 MT` of crude steel in the year 2020 an increase of 1.5% compared to 2019.China’s crude steel production in the year 2020 reached 1053 MT up by 5.2% in theyear 2019. China’s share of global crude steel production increased from 53.3% in theyear 2019 to 56.5% in the year 2020. Except China and few countries the growth of steelproduction in all major economies remain negative for the year 2020. Economic recovery wasuneven across countries depending on the success to contain the spread of virus andfinancial stimulus announced.

India’s Steel Industry Review and Outlook

Our Country is hit badly with COVID 19 effect and thus GDP is negatively affected by24%. Government has taken initiative to promote "Make in India" concept whereinindigenous production will be given preference (especially in procurement of Govt.controlled SAIL group of plants)

The economy has been recovering strongly since August 2020 much sharper than expectedwith the resumption of government projects and pent consumption demand. However thedevastating second wave and renewed rounds of localized lockdown have slowed down theindustrial activities and raised the level of business uncertainty.

India industry overview FY 2021

India’s crude steel production dropped 6% to 102.4 MT in FY 2021 due to pandemicled countrywide shutdown and muted economic activity in the first quarter. Finished steelproduction also slumped 8% to 94.6 MT in FY2021. Several large integrated plants divertedtheir production to exports in first quarter of FY2021 due to muted domestic demand.Finished steel exports grew by 29% to 10.7 MT in FY2021 as 28% of the exports werediverted to China. Finished steel imports dropped 30% to 4.7 MT in FY2021. Finished steelexports reached the peak in June’2020 after which the production was diverted back todomestic markets on steep recovery in demand. Average capacity utilization levels acrossthe country reached 75% of their last year levels by end of July’2020. Thereafterdomestic demand remained strong for rest of year due to government’s financialstimulus pent-up demand for automobiles festive season and easing liquidity in thecountry. Effectively finished steel consumption declined 7% to 93.4 MT in FY2021.India’s HRC & Rebar prices reached their decade high in the end of fiscal yeardue to strong domestic demand iron ore cost push and elevated global prices. With largecapacity cuts in China to reduce pollution and lower domestic steel production (by meansof removal of import duties and export VAT rebates) global market ex-china is expected toremain in deficit. India is expected to benefit from this phenomenon in the short term.Domestic production is expected to be diverted to exports in case of any slowdown indomestic demand due to outbreak of second wave of pandemic. The April’2021 Shortrange outlook published by World Steel Association expects Indian steel demand to grow by19.8% in Current Year 2021; unless the 2nd wave of pandemic plays a major spoil sport. TheIndian auto industry is expected to record strong growth in 2021-22 post recovering fromeffects of COVID-19 pandemic. Electric vehicles especially two-wheelers are likely towitness positive sales in 2021-

22. Huge scope for growth is offered by India’s comparatively low per capita steelconsumption and the expected rise in consumption due to increased infrastructureconstruction and the thriving automobile and railways sectors.

The COVID-19 crisis is linked with consumers demand supply logistics financials andhuman resources. The logistic work has been impacted globally which has disrupted themovement of raw material and finished goods which contributes to the growth challengesacross sectors and hence will impact the steel sector negatively.

Indian Refractory industry

With a production capacity of 1.5 MT the India Refractory Industry is an integral partof the Country’s steel eco system as well as other thermally intensive industriessuch as Cement and Glass. Refractories are used as vital input materials in steelproduction process without which the commodity cannot be made.

The nationwide lockdown has disrupted the production of all refractory manufacturers inyear 2020. Despite the disruption and curtailments in steel production there is demand ofrefractory material with growth in Q2/2020. Indian refractory manufacturers are dependenton China for key raw materials like Bauxite and Magnesia. Clogged logistical network andlack of transportation facilities are taking toll on timely delivery of raw material.Increased freight and raw material cost are starting to be felt in result of refractoryindustries in the year 2021. Due to non-availability of containers the global supply iserratic. The growth of refractory industry is totally dependent on growth of steelindustries in India and globally which is likely to grow in India in the year 2021 due togood monsoon and Government initiatives political stability and growth in foreignreserves. Though it is very difficult to comment on forecast for 2020-2021 even tocomment on short term outlook is difficult because of Government’s action which arechanging the situation on day-to-day basis. With Covid-19 second wave and expected thirdwave very soon there is lot of uncertainties on overall industry growth.

Benefits of the new structure

Year 2018 has seen the Indian steel market becoming the second largest in the worldfurther reinforcing the necessity RHI

Magnesita continued emphasis on this geography. The Indian Steel Ministry has set a 300million tonne per annum steel capacity target by the end of 2030 which bodes well for thefuture of this industry. The Indian steel industry is undergoing consolidation which isexpected to build up its strength but also to provide a higher market share for industryleaders.

As a result of substantial restructuring and consolidation in the India steel industrydemand for higher performance and better-quality solutions has increased a developmentwhich corresponds well to our strengths as a Group and enables us to take advantage ofthis position whilst also working to further strengthen our position in the market interms of cost competitive refractory solutions.

As a combined group in India RHI Magnesite’s business here will be in a strongposition to benefit from this consolidation on the basis of the breath of the combinedorganization as well as its long-standing relationships with the market-leading customers.All the merged Companies are into same and allied business activities.

The new organization structure will form one strong entity to seize growthopportunities and enhance the shareholders’ value. It will help in simplification ofthe corporate structure and consolidation of Indian business. One strong entity willenhance the business and operational synergies shareholders value and utilization ofresources due to pooling of management expertise technologies and other resource of thecompanies. This will also create a larger asset base and facilitation of access to betterfinancial resources by optimizing cash flow which contributes to overall growth prospectsof the combined company. For the customers the new entity will provide single window forall refractory solution under one umbrella though establishing comprehensive refractoryproduct portfolio. There is also an ongoing exercise to optimize the production footprintin India through maximizing the operational and supply chain excellence. The merger willenhance the shareholder value pursuant to economies of scale and business efficiencies.

Challenges & Opportunities Challenges

The financial year 2020-21 was badly impacted in first half as all the major steelbuying industries like energy auto machinery construction showed negative growth duringthe first half 2020. The demand started growing in second half due to good monsoonGovernment fiscal policy and exports. Below are the factors that resulted in challengingtimes for the industries in terms of growth and margins-

- Volatility in currency is a big concern to keep the margins intact. Rupeedepreciation against Dollar and Euro has impacted profitability.

- Non availability of containers and increase in freight and RM cost is biggest concernfor refractories in current and in future.

- While steel output prices turned soft inputs continued to be costlier for domesticproduction. There are likely to be pressure on the margins in future.

- Raw materials availability from China is in short supply which will have an impact onprofitability margin.

- COVID-19 second wave has disrupted supplies demand human resource and createduncertainty to Industrial growth for first quarter and third wave is expected soontherefore market is very uncertain.


The Indian steel industry has a good chance to seize the opportunity as the steel millsare gearing up for an increase in demand from overseas buyers as the pandemic has chokedthe supplies from China. National Steel Policy 2017 states that India’s objective isto increase the per Capita Steel Consumption from 60 Kg. to 160 Kg. by 2030-31 this inturn would have 300 tonne capacity.

Also to achieve 5 trillion USD economy by fiscal year 2025 India needs to spend 1.4trillion USD on infrastructure.

The growing steel industry along with the elevating infrastructure development isaugmenting the demand for refractory materials. These materials exhibit higher-temperatureresistance than conventional ones thereby positively influencing the market growth. Thewidespread adoption of unshaped refractories for several construction applications is alsoinflating the global market. Additionally the high prevalence of recycling refractorymaterials for steel production is also augmenting the market growth. The growingpopularity of refractories in various sectors such as aerospace automotive medical andelectrical is anticipated to drive the market


The Board recommended a dividend of 2.50 per equity share on 160996331 equity sharesof Re. 1.00 each for the year ended 31 March 2021. The dividend on equity share is subjectto the approval of the shareholders at ensuing Annual General Meeting (‘AGM’).

The dividend pay-out is in accordance with the company’s dividend distributionpolicy the policy is available on the weblink


The Company has only one subsidiary i.e. Intermetal Engineers (India) PrivateLimited as on 31 March 2021. There are no associates or joint venture companies within themeaning of Section 2(6) of the Companies Act 2013 ("Act"). There has been nomaterial change in the nature of the business of the subsidiary.

Pursuant to the provisions of Section 129(3) of the Act a statement containing thesalient features of financial statements of the Company’s subsidiaries in Form No.AOC-1 is attached to the financial statements of the Company as Annexure-I.

Further pursuant to the provisions of Section 136 of the Act the financial statementsof the Company consolidated financial statements along with relevant documents andseparate audited financial statements in respect of subsidiary are available on thewebsite of the Company


In terms of Section 134 (3) (l) of the Companies Act 2013 no material changes andcommitments affecting the financial position of your Company have occurred between the endof the financial year of the Company to which the financial statements relate and on thedate of this report except as disclosed elsewhere in this report.


The Company has adequate internal control systems in place and also has reasonableassurance on authorizing recording and reporting transactions of its operations. TheCompany has a well-placed proper and adequate internal controls environment commensuratewith its size scale and complexities of its operations. The Company had already developedand implemented a framework for ensuring internal controls over financial reporting. Thisframework includes entity level policies processes and operating level standard operatingprocedures. Internal control systems are an integral part of your Company’s corporategovernance structure. These have been designed to provide reasonable assurance with regardto inter-alia

(a) recording and providing reliable financial and operational information;

(b) complying with the applicable statutes;

(c) safeguarding assets from unauthorized use;

(d) executing transactions with proper authorization and ensuring compliance withcorporate policies;

(e) Prevention and detection of frauds / errors and

(f) Continuous updating of IT systems. The Company’s management has assessed theeffectiveness of the Company’s internal control over financial reporting as of 31March 2021. The Audit Committee reviewed the reports submitted by the Management InternalAuditors and Statutory Auditors. Based on their evaluation (as defined in section 177 ofthe Companies Act 2013 and Regulation 18 of Listing Regulations 2015) theCompany’s Audit Committee has concluded that as of 31 March 2021 the Company’sinternal financial controls were adequate and operating effectively.


Employees being prime force the Company give equal emphasis on employees’development and their engagement. Our people are the most important resource we have. TheCompany believes in enhancing the competencies of employees to create a high performingand innovative organization. Employees are facilitated to participate in training programsin house and at outside institutes. Equal emphasis is given on technical & softskills. We are creating numerous opportunities for our employees to develop includinginternational development paths and special initiatives for the future management of ourcompany. Last year our main focus of in-house trainings was on interpersonal skillsbehavioral attributes customer focused culture lean implementation and 5’s at shopfloor. The Company endeavors to keep the employee’s motivation high level byproviding congenial & respectful work atmosphere and rewarding/remuneratingeffectively. 100% safety of our employees is one of the important operative targets forRHIM. Various initiatives have been launched to engage employees. Communicating andreaching out to employees at all levels is being done by using various mass mediatechniques. Celebrating festivals and achievements on various occasions is part of RHIMculture. There are cordial relations between the management and the employees of theCompany.


All contracts /arrangements / transactions entered by the Company during thefinancial year with related parties were in ordinary course of business and on anarm’s length basis. During the year the Company has not entered into any contracts/arrangements / transactions with related parties which could be considered material inaccordance with the policy of the Company on materiality of related party transactions.Accordingly the disclosure of related party transactions as required under Section134(3)(h) of the Companies Act 2013 in Form AOC - 2 is not applicable to your Company.

The policy on materiality of related party transactions and dealing with related partytransactions are approved by the Board and can be accessed on the Company’s websiteat the link: Members can refer thefinancial statements which set out related party disclosures.

The Board of Directors of the Company has approved the criteria for making the omnibusapproval by the Audit Committee within the overall framework of the policy on relatedparty transactions. Prior omnibus approval is obtained for related party transactionswhich are of repetitive nature and proposed to be entered in the ordinary course ofbusiness and at arm’s length during the financial year. All related partytransactions are placed before the Audit Committee for review and approval.


The brief outline of the Corporate Social Responsibility (CSR) Policy of theCompany as adopted by the Board and the initiatives undertaken by the Company on CSRactivities during the year under review are set out in Annexure II of this report in theformat prescribed in the Companies (Corporate Social Responsibility Policy) Rules 2014.For other details regarding the CSR Committee please refer to the Corporate GovernanceReport which is a part of this report. The CSR policy is available on


The Company’s Board of Directors has overall responsibility for theestablishment and oversight of the Company risk management framework. The Company hasframed a Risk Management Policy to identify and access the key business risk areas and arisk mitigation process. The policy aims to ensure resilience for sustainable growth andsound corporate governance by having an identified process of risk identification andmanagement in compliance with the provisions of the Companies Act 2013. Risk managementpolicies and systems are reviewed regularly to reflect changes in market conditions andthe Company’s activities. The Company through its training and management standardsand procedures aims to maintain a disciplined and constructive control environment.

We regard occupational safety and health as an integral part of our operations and makeit a prime consideration in every decision we make. We comply with all regulatory healthand safety norms by assessing risks providing controls for health and safety hazards andconducting audits. At workplace we believe in TEI (Total Employees Involvement).Employees are encouraged to report unsafe conditions and unsafe practices. Safetychampions are trained time to time. The Company has got ISO 45000 Certification in FY2021. In FY 2021 we achieved zero accident.

The Board has formed a Risk Management Committee. The composition of the same has beengiven in Corporate

Governance Report.

The Risk Management Committee oversees how management monitors compliance with theCompany’s risk management policies and procedures and reviews the adequacy of therisk management framework in relation to the risks faced by the Company. There are norisks which in the opinion of the Board threaten the existence of the Company.


Mr. Erwin Jankovits retires by rotation and being eligible offers himself forre-appointment.

Mr. Nazim Sheikh who was appointed as an Additional Independent Director on 3 November2020 will retire at the ensuing AGM of the Company in terms of provisions of Section 161of the Companies Act 2013 unless re-appointed. In due compliance with the provisions ofSection 149 of the Companies Act 2013 it is proposed to appoint Mr. Nazim Sheikh as

Independent Director on the Board of the Company to hold office for 5 years from thedate of his initial appointment up to 2 November 2025 and he will not be liable to retireby rotation.

Mr. Rudraraju Venkata Suryanarayana Raju (Mr. RVS Rudraraju) who was appointed as anAdditional Director on 25 June

2021 will retire at the ensuing AGM of the Company in terms of provisions of Section161 of the Companies Act 2013 unless re-appointed. He is also appointed as whole TimeDirector of the Company for a period of 5 years from the date of his initial appointmentup to 24 June 2026 and he will be liable to retire by rotation.

Resolutions seeking shareholders’ approval for appointment & re-appointmentalong with other required details forms part of the Notice.

Mr. Rama Shanker Bajoria (DIN 00033727) Independent Director upon completion of hissecond tenure as an independent director retired on 23 September 2020 he passed away on12 December 2020. The Directors place on record their deep appreciation of his visionleadership and enormous contribution towards the Company and express a deep gratitude tohis indefatigable influential spirit for shaping the Company. Pursuant to the provisionsof Section 149 of the Act the independent directors have submitted declarations that eachof them meets the criteria of independence as provided in Section 149(6) of the Act alongwith Rules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations.There has been no change in the circumstances affecting their status as independentdirectors of the Company.

During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company other than sitting fees andreimbursement of expenses if any.

Pursuant to the provisions of Section 203 of the Act Mr. Parmod Sagar ManagingDirector and Chief Executive Officer Mr. Sanjeev Bhardwaj Chief Financial Officer andMr. Sanjay Kumar Company Secretary are the Key Managerial Personnel of the Company as on31 March 2021. During the year there has been no change in the Key Managerial Personnel.


The Company has devised the Nomination and Remuneration Policy for the selectionappointment and remuneration of the Directors and Key Managerial Personnel and alsoremuneration of other employees who have the capacity and ability to lead the Companytowards achieving sustainable development. The Nomination and Remuneration Policy of theCompany is available on the Company’s website and can be accessed on theCompany’s website at the link: http://www.

The criteria for appointment and remuneration of directors is as under:

i. Criteria for appointment of Managing Directors / Whole Time Director / Director:

The Nomination and Remuneration Committee shall identify persons of integrity whopossess relevant expertise and experience particularly in refractory industry leadershipqualities required for the position and shall take into consideration recommendation ifany received from any member of the Board.

ii. Criteria for appointment of Independent Director:

The Independent Director shall be of high integrity with relevant expertise andexperience so as to have as diverse

Board with directors having expertise in the fields of manufacturing marketingfinance and general management


Pursuant to Section 134(5) of the Act the Board of Directors to the best of itsknowledge and ability confirm that:

i. in the preparation of the annual accounts the applicable accounting standards havebeen followed and there are no material departures;

ii. they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitof the Company for that period;

iii. they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

iv. they have prepared the annual accounts on a going concern basis;

v. they have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and operating effectively

vi. they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.


The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and SEBIListing Regulations.

The performance of the board was evaluated by the Board after seeking inputs from allthe directors on the basis of criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.

The performance of the committees was evaluated by the Board after seeking inputs fromthe committee members on the basis of criteria such as the composition of committeeseffectiveness of committee meetings etc.

The above criteria are broadly based on the Guidance Note on Board Evaluation issued bythe Securities and Exchange Board of India on 5 January 2017.

In a separate meeting of independent directors held on 29 June 2020 performance ofnon-independent directors the Board as a whole and Chairman of the Company was evaluatedtaking into account the views of executive directors and non-executive directors.

The Board and the Nomination and Remuneration Committee reviewed the performance ofindividual directors on the basis of criteria such as the contribution of the individualdirector to the board and committee meetings like preparedness on the issues to bediscussed meaningful and constructive contribution and inputs in meetings etc.

At the board meeting that followed the meeting of the independent directors and meetingof Nomination and Remuneration Committee the performance of the Board its Committeesand individual directors was also discussed. Performance evaluation of independentdirectors was done by the entire Board excluding the independent director being evaluated


i. Statutory Auditor

M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016)were appointed as

Statutory Auditors of the Company at the 7th AGM held on 25 September 2017 for a periodof 5 years for auditing the accounts of the Company from the conclusion of 7th AGM tillthe conclusion of 12th AGM of the Company for the year 2021-22.

ii. Internal Auditor

The Board has appointed M/s. Chaturvedi & Partners as Internal Auditors for thefinancial year 2019-20 under Section 138 of the Companies Act 2013 and they havecompleted the internal audit as per the scope defined by the Board. They have beenre-appointed for the financial year 2020-21 also.

iii. Secretarial Auditor

The Company has appointed M/s. Naresh Verma & Associates Company Secretaries inPractice to conduct Secretarial Audit for the financial year 2019-20 as required bySection 204 of the Companies made thereunder. The Company provided all assistance andfacilities to the secretarial auditors for conducting their audit. The Secretarial AuditReport for the financial year ended 31 March 2021 is annexed herewith marked as

Annexure - III.

iv. Cost Auditor

As per Section 148 of the Companies Act 2013 the Company is required to have theaudit of its cost records conducted by a Cost Accountant in practice. In this connectionthe Board of Directors of the Company has on the recommendation of the Audit Committeeapproved the appointment of M/s. K. G. Goyal & Associates as the Cost Auditors of theCompany for the year ending 31 March 2022.

In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of theCompanies (Audit and Auditors) Rules 2014 the remuneration payable to the cost auditorsas recommended by the Audit Committee and approved by the Board has to be ratified by themembers of the Company. Accordingly appropriate resolution forms part of the noticeconvening the AGM. The Board seeks your support in approving the proposed remuneration ofRs. 75000 plus out-of-pocket expenses and taxes payable to the Cost Auditors for thefinancial year 2021-22. M/s. K. G. Goyal & Associates have vast experience in thefield of cost audit and have conducted the audit of the cost records of the Company forthe past several years under the provisions of the erstwhile Companies Act 1956.

The Cost Audit Report for the year ended 31 March 2021 will be filled within statutorytime limit.


There are no qualifications in the reports of the Statutory Auditor and SecretarialAuditors’ except one adverse observation by Secretarial Auditor’s regardingshort fall in Corporate Social Responsibility expenditure. which is explained in CSRdisclosure (Annexure II) stated in this report and no further explanation is required.

There are no frauds reported in the reports of the auditors as mentioned undersub-section (12) of Section 143 of the Act.


RHI Magnesita N.V (Ultimate Holding Company) has implemented a share option planfor the members of senior management including of the Company. Each share option convertsinto one ordinary share of RHI Magnesita N.V on exercise. No amounts are paid or payableby the recipient on receipt of the option. The options carry rights to dividends but novoting rights. Options may be exercised at any time from the date of vesting to the dateof their expiry. The number of options granted is calculated in accordance with theperformance-based formula approved by the shareholders of the Ultimate Holding Company.The vesting period for each share option plan is three years. If the options remainunexercised after a period of seven years from the vesting date the options expire.Options are forfeited if the employee leaves the Company before the options vest. Theallocation of share option plan has been made by the Ultimate Holding Company details havebeen disclosed in the financial statements.


The Company enjoys the status of "One Star Export House".


There is no change in the nature of business of your Company during the year underreview


i. Vigil Mechanism /Whistle Blower Policy

The Vigil mechanism of the Company which also incorporate a whistle blower policy inthe terms of SEBI (Listing Obligations and Disclosure Requirements) 2015 deals withinstances of fraud and mismanagement if any. The policy on vigil mechanism and whistleblower policy may be accessed on the Company’s website at the link:

ii. Audit Committee The composition of the Audit Committee has been given in CorporateGovernance Report. All the recommendations made by the Audit Committee were accepted bythe Board.

iii. Number of Board Meeting The Board of Directors of the Company met four (4) timesin the year the details of which are provided in the corporate governance report.

iv. Particulars of Loans given Investment made Guarantees given and Securitiesprovided

The particulars of loans guarantees and investments as per Section 186 of the Act bythe Company have been disclosed in the financial statements.

v. Conservation of Energy Technology Absorption and Foreign Exchange Earnings &Outgo The particulars relating to Conservation of Energy Technology Absorption andForeign Exchange Earnings & Outgo as required to be disclosed under Section 134(3)(m)of the Companies Act 2013 read with Rule 8 (3) of the Companies (Accounts) Rules 2014are provided in Annexure - IV.

vi. Extract of Annual Return

Extract of Annual Return of the Company is annexed herewith marked as Annexure - V.

vii. Particulars of employees and related disclosures

The information required under Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is attached as Annexure - VI.

viii. Corporate Governance Report Report on Corporate Governance is annexed herewith asAnnexure - VII to this report. ix. Business Responsibility Reporting

The Company’s ethical and responsible behaviour complements its corporate culture.Being a public listed company the Company recognises that its accountability is notlimited only to its shareholders from a financial perspective but also to the largersociety in which it operates. During the year consequent to the requirements of reportingof its business responsibility initiatives becoming mandatory under the ListingRegulations the Company formulated a consolidated policy on business responsibility whichlays down the broad principles guiding the Company in delivering its variousresponsibilities to its stakeholders. The policy is intended to ensure that the Companyadopts responsible business practices in the interest of the social set up and theenvironment so that it contributes beyond financial and operational performance. A copy ofthe policy is available at and theBusiness Responsibility

Report for the year ended 31 March 2021 in terms of Regulation 34 of the ListingRegulations is annexed to this report as Annexure - VIII.

x. Transfer of amounts to Investor Education and Protection Fund

Details regarding transfer of amount & shares to IEPF has been given in CorporateGovernance Report.

xi. Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal)Act2013 The Company has formulated and implemented a policy of prevention of sexualharassment at the workplace with mechanism of loading/redressal complaints. During theyear under review there were no complaints reported to the Board. The policy may beaccessed on the Company’s website at the link: htm

xii. Compliance with the Institute of Company Secretaries of India ("ICSI")Secretarial Standards The relevant Secretarial Standards issued by the ICSI related to theBoard Meetings and General Meeting have been complied with by the Company.

xiii. No disclosure or reporting is required in respect of the following items as therewere no transaction on these items during the year under review:

- Details relating to deposit and unclaimed deposits or interest thereon.

- Issue of equity shares with differential rights as to dividend or voting.

- Issue of shares (including sweat equity shares) and Employee Stock Option Scheme ofthe Company under any scheme. by the Regulators or Courts or Tribunals which impact thegoing - Nosignificant concern and Company’s operation in future


Certain statements in the "Management Discussion and Analysis" describing theCompany’s views about the Industry expectations/ predictions objectives etc. maybe forward looking within the meaning of applicable laws and regulations. Actual resultsmay differ materially from those expressed in the Statement. Company’s operations mayinter-alia affect with the supply and demand stipulations input prices and theiravailability changes in Government regulations taxes exchange fluctuations and otherfactors such as Industrial relations and economic developments etc. Investors should bearthe above in mind.


The Directors thank the Company’s employees customers vendors and investors fortheir continuous support. The Directors also thank the Government of India Governments ofvarious states in India Governments of various countries and concerned Governmentdepartments and agencies for their co-operation.

The Directors mourn the loss of life due to COVID-19 pandemic and are deeply gratefuland have immense respect for every person who risked their life and safety to fight thispandemic.

The Directors appreciate and value the contribution made by every member of the RHIMfamily.

On behalf of the Board of Directors
Dr. Vijay Sharma
Gurugram 11 August 2021 (DIN:00880113)