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Welspun Corp Ltd.

BSE: 532144 Sector: Metals & Mining
NSE: WELCORP ISIN Code: INE191B01025
BSE 13:00 | 06 Oct 275.05 16.40
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OPEN 257.10
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VOLUME 112919
52-Week high 298.35
52-Week low 123.00
P/E 13.75
Mkt Cap.(Rs cr) 7,193
Buy Price 274.95
Buy Qty 1.00
Sell Price 275.35
Sell Qty 97.00
OPEN 257.10
CLOSE 258.65
VOLUME 112919
52-Week high 298.35
52-Week low 123.00
P/E 13.75
Mkt Cap.(Rs cr) 7,193
Buy Price 274.95
Buy Qty 1.00
Sell Price 275.35
Sell Qty 97.00

Welspun Corp Ltd. (WELCORP) - Director Report

Company director report

To

The Members

Welspun Corp Limited

Your directors have pleasure in presenting the 27th Annual Report ofyour Company along with the Audited Financial Statements for the financial year endedMarch 31 2022.

1. FINANCIAL RESULTS

( Rs in Mn)

Particulars

Standalone

Consolidated

For the year ended

For the year ended

31.03.2022 31.03.2021 31.03.2022 31.03.2021
Total income 57704.92 61503.17 70563.32 75093.91
Profit before finance cost depreciation & tax 7870.12 14780.23 10229.06 11519.10
Less : Finance costs 768.78 579.40 1018.85 849.48
Profit before depreciation & tax 7101.34 14200.83 9210.21 10669.62
Less: Depreciation and amortization expense 1152.75 1096.79 2547.54 2464.69
Add: Share of net loss of joint ventures accounted for using the equity method (57.20) 1349.20
Profit before exceptional items & tax 5948.59 13104.04 6605.47 9554.13
Exceptional Items - Income / (Expenses) 1376.14
Profit before tax 5948.59 13104.04 6605.47 10930.27
Less : Provision for tax
Current Tax 1094.60 3889.59 2297.10 3938.77
Deferred Tax (3.24) (1036.97) (133.18) (1385.36)
Profit after taxes before Non-controlling interests from continuing operations 4857.23 10251.42 4441.55 8376.86
Profit/ (loss) before tax from discontinued operations - (104.26) (143.64)
Tax expense from discontinued operations - (33.26) (33.26)
Profit / (loss) from discontinued operations after tax - (71.00) - (110.38)
Profit for the period 4857.23 10180.42 4441.55 8266.48
Less :Non-controlling interests - - 53.55 590.60
Profit after tax for the year (after 4857.23 10180.42 4388.00 7675.88
Non-controlling interests)
Add : balance brought forward from previous year 15988.18 5920.85 25197.10 17645.41
Re-measurements of post-employment benefit (net of tax) 19.32 17.35 14.04 15.35
Share of OCI of joint ventures (4.34) (9.05)
Dividend on equity shares (1304.75) (130.44) (1304.75) (130.44)
Share issue expenses during the year - - (34.82) -
Balance carried forward to the next year 19559.98 15988.18 28255.23 25197.15

2. HIGHLIGHTS FOR THE YEAR & OUTLOOK

(a) Sales Highlight for the year under the report are as under

Product

Standalone (in MT)

Consolidated(in MT)

FY 2021-22 FY 2020-21 FY 2021-22 FY 2020-21
MS Pipes 506483 626249 795826 1002947
Billet 111738 175403 111738 175403
SS Pipes 2915 1937 2915 1937

MS Pipes Consolidated sales includes operations at Saudi Arabia

(b) Outlook:

The Financial Year under Report was a pivotal year for your Company asit made significant progress on its Business Growth & Diversification Strategy. YourCompany demonstrated resilience despite a sharp increase in steel prices and a weakoperating environment. As the Company embarks upon a new journey of growth along withsustainability at the core the management is confident of creating incremental value forall its stakeholders. Your Company's foray into the B2C segment would help improveits competitiveness and provide a stronger base for future growth.

The Government has set a target to raise the share of natural gas inthe energy mix to 15% by 2030 from about 6.7% now. Various steps taken by the Governmentin this direction include expansion of National Gas Grid Pipeline expansion of City GasDistribution network setting up of Liquefied Natural Gas etc.

There is a big focus on creating drinking water supply in the countrythrough Government programs. There is also a coordinated focus by both the Central andState Governments on increasing the area under irrigation through various schemes.

Overall the government's programs reflect the continued focus onimproving the lives of people through several schemes to build water infrastructure toincrease the use of natural gas to build refining capacity etc. Your Company is confidentthat it will see a steady improvement in demand for line pipes and DI pipes as theseprograms are implemented.

As the members may be aware that Russia's invasion of Ukraine isdriving up the prices in the Global Energy market. Sanctions on

Russia have contributed to rising crude prices with significant marketuncertainties about the potential for further supply disruptions. Gas prices all over theworld have also gone up in tandem. Your Company is in active discussions for severalorders in the export markets which have seen an improvement in prospects for pipelines dueto high oil prices increased energy demand and Europe looking to diversify its energysupply away from Russia.

The clean energy transition in the US has been interrupted due tosoaring prices and the disruptions caused by geo political events in Europe. There is arevival in demand for fossil fuels due to which there has been an increase in Oil &Gas exploration. The US is now focused on boosting supply within the country but alsotrying to provide the much-needed back up to Europe for critical gas supplies therebycreating a need to evacuate both Oil & Gas through some potential long distance largediameter pipelines. This augurs well for your Company as it has a manufacturing facilityin Little Rock US.

(c) Pig Iron and Ductile Iron Pipe facilities in Anjar

As mentioned in the previous Annual Report the steel making facilityof 400 KMPTA and DI Pipe Plant of 400 KMPTA under two separate wholly owned subsidiariesare under construction and are expected to be commenced in early FY 2022-23.

Due to improvements to the project plan and inflation the project costhas been revised from Rs 15500 Mn (plus soft costs) to

Rs 19000 Mn (plus soft costs). Some of the major reasons for thevariance are: 1) Design changes for productivity improvements and increased safety 2)Augmentation and increase in capacities of BF Sinter Coke Oven and DI Pipes 3) OwnOxygen plant instead of a BOOT model 4) Transfer of BF gas directly to the power plant toreduce emissions 5)

Cost escalation for key input commodities like Steel TMT bars CementOcean Freight etc. and 6) Creating expanded residential infrastructure for our Staff andAssociates.

The project viability continues to be healthy with the increasedinvestment being offset through productivity gains and increased realizations for DIpipes.

The project is being funded through internal accruals and externaldebts.

(d) Sale of the Plate & Coil Mill Division ("PCMD"):

As mentioned in the previous Annual Report the transactioncontemplated in the Business Transfer Agreement dated March 30 2019 (the "BTA")has been concluded on March 31 2021. As regards purchase consideration the

Company has received the full consideration of Rs8485 Mn net ofclosing adjustments towards net working capital and there is no further considerationreceivable.

(e) Offer for sale & Listing of shares of subsidiary in the Kingdomof Saudi Arabia:

As mentioned in the previous Annual Report the shares of East PipesIntegrated Company for Industry (erstwhile joint-venture in Kingdom of Saudi Arabia) havebeen successfully listed w.e.f. February 14 2022 on Saudi Exchange's Main Market(‘Tadawul') and made strong debut.

Post the offer for sale and listing the shareholding of the Company inthe joint venture through its step-down subsidiary in Mauritius has reduced to 35.01%from 50.01%.

(f) Scheme of Arrangement between Welspun Steel Limited ("theDemerged Company") and Welspun Corp Limited ("the Resulting Company") andtheir respective shareholders ("the Scheme").

As mentioned in the previous Annual Report the Scheme of Arrangementbetween Welspun Steel Limited (the "Demerged Company") and Welspun Corp Limited(the "Resulting Company") and their respective shareholders (the"Scheme") has been sanctioned by the Ahmedabad bench of National Company LawTribunal ("NCLT") vide its order pronounced on March 16 2022 (the"Order"). In terms of the Scheme the captioned Scheme has become effective fromthe date of passing of the Order by the NCLT i.e. March 16 2022 with the Appointed Dateof April 1 2021.

The Scheme of Arrangement is in line with the Company's BusinessGrowth & Diversification strategy to improve earnings predictability and enhance valuecreation for all its stakeholders.

The Company will add to its product portfolio by manufacturing BISCertified Steel Billets Direct Reduced Iron TMT bars Stainless & Alloy Steel andStainless Steel Tubes & Pipes. It intends to create significant value throughexpanding its offerings to address both the B2B and B2C segments. The diversification intothe B2C segment will help the Company to significantly expand its base enhance its brandpenetrate new markets build a distribution network and provide opportunities to developnew products.

Further as the Demerged Company also held 50.03% equity shares inWelspun Specialty Solutions Ltd. ("WSSL") upon the Scheme becoming effectivethe shares of WSSL held by the Demerged Company stands transferred to the ResultingCompany. WSSL manufactures Super Specialty Steel & Steel products that are used forcritical applications in sectors like Energy Defence Nuclear Power Aerospace Oil &Gas Petrochemicals Food Fertilizers Pharma Desalination etc.

(g) Acquisitions of Special Purpose Vehicles (SPV)

Your Company's growth strategy entails creating a diversifiedproduct portfolio repurposing its business to add new target segments expanding itsofferings to address both the B2B and B2C markets and making well-considered strategicacquisitions. The diversification into the B2C segment will help your Company tosignificantly expand its base enhance its brand penetrate new markets build adistribution network and provide opportunities to develop new products.

For organic / inorganic growth of the businesses under the objects ofthe Company your Company has acquired from an unrelated party entire share capital of:

? Mahatva Plastic Products and Building Materials Private Limited("Mahatva") a newly incorporated company with objects inter alia of Polymerproducts business

? Big Shot Infra Facilities Private Limited ("Big Shot") anewly incorporated company with objects inter alia of Infrastructure facilities(Acquired on April 18 2022).

Mahatva has acquired Sintex BAPL Ltd.'s Senior Secured UnlistedNon-Convertible Debentures with outstanding of Rs 11288 Mn for a purchase price of Rs3869.37 Mn.

(h) Long Products.

The demand for Long Steel Products would be supported by increasedgovernment spending on infrastructure. The Union Budget 2022-23 has seen an increase of36% Y-o-Y in allocation of capex. The budget has infrastructure push towards seven engines(roads railways airports ports mass transport waterways and logistic infra). Theallocation for various schemes like Pradhan Mantri Awas Yojana (for housing) will have apositive impact on long steel players. The government has a fixed objective of increasingrural consumption of steel from the current 19.6 kg/per capita to 38 kg/per capita by2030-31.

Our forward integration plan of setting up a TMT Bars plant at Anjarwith a capacity of 350 KMPTA is on track and we expect to begin Commercial Operations inQ2-2022-23.

(i) ESG Initiatives

During the year your Company has taken several ESG interventionsaligned with global ESG standards. Your Company was ranked 13th among the 41 companiesincluded in its industry group (68th percentile) in S&P Global's DJSI CorporateSustainability Assessment (CSA).

(j) Carbon Neutrality Signing of Memorandum of Understanding

In line with the Company's ESG framework your Company remainsstrongly committed to net-zero carbon emissions with an aim of lowering its carbonfootprint in core operations through renewable energy cleaner transport effective energymanagement water circularity and sludge cycling bio-gas under the company'ssustainability goals.

In the same regard the Company has signed a

Memorandum of Understanding with BP India Pvt Ltd. to jointly explorecarbon emission mitigation and reduction opportunities in your Company's energylogistics mobility and waste management activities.

3. RESERVES DIVIDEND & DIVIDEND POLICY.

The Board is pleased to recommend a dividend @ 100% for the year endedMarch 31 2022 i.e. Rs 5 per equity share of Rs 5/- each fully paid-up out of the netprofits for the year. In respect of the dividend declared for the previous financialyears

Rs 8.5 Mn remained unclaimed as on March 31 2022. During the yearunder Report the Company has transferred dividend of Rs 380098 remaining unclaimed forthe financial year 2013-14 to the Investor Education and Protection Fund. Detail ofunclaimed dividend is available on the website of the Company at"www.welspuncorp.com".

The Company has appointed Mr. Pradeep Joshi Company Secretary as theNodal Officer for the purpose of co-ordination with Investor Education and Protection FundAuthority. Details of the Nodal Officer are available on the website of the Company atwww.welspuncorp.com.

The Board does not propose to transfer any amount to General Reserves.

In terms of the Regulation 43A of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board of Directors approved and adoptedDividend Distribution

Policy of the Company setting out the parameters and circumstances thatwill be taken into account by the Board in determining the distribution of dividend to theshareholders and/ or retaining the profits earned by the Company. The Policy is annexed tothis Report as Annexure 1 and is also available on your Company's website at"http://www.welspuncorp.com" under the tab "Who We Are --> PolicesDisclosures Notices."

4. INTERNAL CONTROLS & INTERNAL AUDIT

Your Company has adequate internal control system which iscommensurate with the size scale and complexity of its operations. Your Company has aprocess in place to continuously monitor existing controls and identify gaps and implementnew and / or improved controls wherever the effect of such gaps would have a materialimpact on your Company's operation. The controls were tested during the year underReport and no reportable material weaknesses either in their design or operations wereobserved. In other observations appropriate corrective actions were taken as advised bythe Audit Committee.

At the beginning of each financial year a risk-based annual audit planis rolled out after it is approved by the Audit Committee and the Board. The audit planaims to evaluate the efficacy and adequacy of the internal control system(s) andcompliance(s) thereof robustness of internal processes policies and accountingprocedures compliance with laws and regulations.

The Internal Audit is carried by independent external audit firmconsisting of qualified accountants domain & industry experts fraud risk andinformation technology specialists.

Based on the reports of internal auditor corrective actions are takenwherever required. Significant audit observations and corrective actions thereon arepresented to the Audit Committee of the Board.

In view of COVID-19 pandemic and consequent restrictions imposed tocurb its spread conduct of physical audits became difficult. Under such challengingcircumstances and considering the safety and well-being of employees Internal

Auditors envisioned and adopted a mixed approach comprising of on siteand ‘remote audit' approach by leveraging technology to ensure continuity inaudit and assurance processes.

A comprehensive plan scoping and deployment of data analyticsfacilitated seamless and effective conduct of remote internal audits during the year.

5. SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES AND THEIRPERFORMANCE

A report on the performance and financial position of each of thesubsidiaries and joint venture companies included in the consolidated financial statementis presented in Form AOC-1 annexed to this Report as Annexure 2.

Financial statements of the subsidiaries and joint venture are hostedon the website of the Company at "http://www.welspuncorp.com" under the tab"Investor Relations --> Subsidiary Accounts".

6. DEPOSITS

The Company has not accepted any deposit within the meaning of theChapter V to the Companies

Act 2013. Further no amount on account of principal or interest ondeposit was outstanding as at the end of the year under report.

7. DETAILS OF UTILIZATION OF FUNDS RAISED THROUGH PREFERENTIALALLOTMENT OR QUALIFIED INSTITUTIONS PLACEMENT AS SPECIFIED UNDER REGULATION 32 (7A)

During the year under Report the Company raised

Rs 400 Mn by issuing unsecured rated listed taxable redeemablenon-convertible debentures on private placement basis for General Corporate Purposes. Thefunds have been used for the purpose for which the same were raised.

8. AUDITORS i) Statutory Auditors:

Your Company's Auditors M/s. Price Waterhouse CharteredAccountants LLP who have given their consent and confirmation of qualification forre-appointment as the Statutory Auditors have been re-appointed for second term ending onthe conclusion of the 29th Annual General Meeting. The remuneration approved by the Boardfor the Financial Year 2022-23 is Rs 17.85 Mn p.a. plus applicable taxes (subject todeduction of tax as may be applicable) and travelling and out-of-pocket expenses.

Total fees for all services paid by the Company and its subsidiarieson a consolidated basis to the statutory auditors and all entities in the networkfirm/network entity of which the statutory auditors is a part during the financial yearunder Report is Rs 28.13 Mn.

ii) Cost Auditors:

M/s. Kiran J. Mehta & Co Cost Accountants (Firm Registration No.000025) have been appointed as the Cost Auditors under Section 148 of the Companies Act2013 for the Financial Year 2022-23. The members are requested to approve theirremuneration by passing an ordinary resolution pursuant to Rule 14 of the Companies (Auditand Auditors) Rules 2015.

iii) Secretarial Auditors:

The Board of Directors have re-appointed M/s. Mihen Halani &Associates Practicing Company Secretary as the Secretarial Auditor of your Company forthe

Financial Year 2022-23.

9. AUDITORS' REPORT

(a) Statutory Auditors' Report:

The Auditors' observations read with Notes to Accounts areself-explanatory and therefore do not call for any comment.

No frauds or instances of mismanagement were reported by the StatutoryAuditor under Section 143(12) of the Companies Act 2013.

(b) Cost Audit Report :

As required under the Companies (Cost

Records and Audit) Rules 2014 the cost accounting records asspecified by the Central Government under Section 148(1) of the Companies Act 2013 weremade and maintained by the Company.

The Company had appointed M/s. Kiran J. Mehta & Co. CostAccountants as the Cost Auditors of the Company for auditing cost accounting records forthe financial year 2021-22. The Cost Audit Report for the year 2020-21 was e-filed onAugust 10 2021. The Cost Audit for the financial year 2021-22 is in progress and thereport will be e-filed to the Ministry of Corporate Affairs Government of India in duecourse.

(c) Secretarial Audit Report :

Secretarial Audit Report given by M/s. Mihen Halani & AssociatesCompany Secretaries is annexed with the Report as Annexure 3. The Report read withthe annexure thereto is self-explanatory and therefore do not call for any furthercomments.

10. SHARE CAPITAL & LISTING

A) The Company does not have any equity shares with differential rightsand hence disclosures as per Rule 4(4) of the Companies (Share Capital and Debentures)Rules 2014 are not required. Further the Company has not issued any sweat equity sharesand hence no disclosure is required under Rule 8 (13) of Companies (Share Capital andDebentures) Rules 2014.

The Company had granted stock options during the financial year2018-19. Disclosure as required under Regulation 14 of the SEBI (Share Based EmployeeBenefits & Sweat Equity) Regulations 2021 Rule 12(9) of the Companies (Share Capitaland Debentures) Rules 2014 and Part-F of Schedule I to the SEBI (Share Based EmployeeBenefits & Sweat Equity) Regulations 2021 are as under:

(I) A description of each ESOS that existed at any time during the year including thegeneral terms and conditions of each ESOS including -

(a) Name of the ESOP Plan Welspun Employee Stock Option Plan
(b) Date of shareholders' approval September 30 2005
(c) Total number of options approved under ESOS 5614752
(d) Vesting requirements Vesting: 30% on end of one year from the date of grant; 35% on end of second year from the date of grant and 35% on end of third year from the date of grant.
(e) Exercise price or pricing formula At the discount up to 25% to the latest available closing market price of the equity shares of the Company rounded off to the nearest higher rupee prior to the date of grant.
(f) Maximum term of options granted 3 years
(g) Source of shares (primary secondary or combination) Primary
(h) Variation in terms of options No modifications were made to the schemes during the year. The Board of Directors however recommended change in the Exercise Price from market linked exercise price to fixed exercise price of" Rs 100/- per ESOP". The change is subject to approval by the shareholders.
(II) Method used to account for ESOS - Intrinsic or fair value. The Company has recognized compensation cost using fair value method of accounting.
The Company has recognized stock option compensation cost of Rs 5.6 million in the statement of profit and loss for the financial year 2021-22.

 

(III) Where the company opts for expensing of the options using the intrinsic value of the options the difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognized if it had used the fair value of the options shall be disclosed. The impact of this difference on profits and on EPS of the company shall also be disclosed. The Company accounted for employee compensation cost on the basis of fair value of the options.

 

(IV) Option movement during the year Number of options outstanding at the beginning of the period 2085000
Options granted Nil
Options forfeited / lapsed 150000
Options vested 735000
Options exercised Nil
The total number of shares arising as a result of exercise of option 65000 Equity shares were allotted during FY 2021-22 for 65000 ESOPs exercised during FY 2020-21.
The exercise price Rs 100/-
Money realized by exercise of options Not Applicable
Loan repaid by the Trust during the year from exercise price received Not Applicable
Number of options outstanding at the end of the year 1935000
Number of options exercisable at the end of the year 1935000

 

Employee wise details of options granted to:-
? Key managerial personnel Granted during the financial year 2018-19: Mr. Vipul Mathur MD & CEO 1500000
? Any other employee who receives a grant of options in any one year of option amounting to five percent or more of options granted during that year Granted during the financial year 2018-19:
? Mr. Lal Hotwani - Head- Corporate Accounts & Taxation : 150000*
? Mr. Godfrey John- BuH - E-MENA India & APAC : 150000
? Mr. T.S.Kathayat- President - Quality & Technical Services: 150000
? Mr. Piyush Thakor- Vice President India Mfg Head: 150000^
? Mr. Chintan Thaker- Head - Corporate Affairs and Strategic Planning Cell: 150000
* Lapsed during FY 2020-21 due to retirement.
^ Lapsed during FY 2021-22 due to separation.

 

? Identified employees who were granted option during any one year equal to or exceeding one percent of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant. Nil

 

Diluted Earnings Per Share (EPS) pursuant to issue of shares on exercise of option calculated in accordance with Accounting Standard (AS) 20 "Earnings Per Share". Rs 18.57
Where the company has calculated the employee compensation cost using the intrinsic value of the stock options the difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognized if it had used the fair value of the options shall be disclosed. The impact of this difference on profits and on EPS of the company shall also be disclosed. The Company accounted for employee compensation cost on the basis of fair value of the options.
Weighted-average exercise prices and weighted-average fair values of options shall be disclosed separately for options whose exercise price either equals or exceeds or is less than the market price of the stock Weighted-average exercise prices Rs 100 weighted-average fair value Rs 52.01
A description of the method and significant assumptions used during the year to estimate the fair values of options including the following weighted-average information:

 

i. the weighted average values of share price Rs 100
ii. the weighted average values of exercise price Rs 100
iii. expected volatility 50%
iv. expected Option life 1.43 years
v. expected dividends 0.55%
vi. risk-free interest rate 7.49% to 7.85%
vii. Method used and the assumptions made to incorporate the effects of expected early exercise; Black Scholes method is used for fair valuation of ESOP.
viii. how expected volatility was determined including an explanation of the extent to which expected volatility was based on historical volatility; The measure of volatility used in ESOP pricing model is the annualized standard deviation of the continuously compounded rates of return. Expected volatility for fair valuation is considered based on average of previous 6 years annualized volatility.
ix. whether and how any other features of the options granted were incorporated into measurement of fair value such as a market condition. The following factors have been considered
(a) Share Price
(b) Exercise price
(c) Historical volatility
(d) Excepted option life
(e) Dividend Yield
x. the price of the underlying share in market at the time of option grant. Rs 126.10

Certificate from M/s Mihen Halani & Associates CompanySecretaries Secretarial Auditors of the Company with respect to the implementation ofWelspun Employee Stock Option Plan would be placed before the members at the ensuingAnnual General Meeting of the Company and a copy of the same shall be available forinspection at the registered office of the Company.

(V) Disclosure of Shares held in suspense account under Clause F ofSchedule V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015

No of shareholders No of shares
Outstanding Balance in the suspense account lying at the beginning of the year 24 6300
Number of shareholders who approached issuer for transfer of shares from suspense account during the year 4 770
Transferred/Credited during the year 4 770
Balance outstanding 20 5530

The voting rights on these shares shall remain frozen till the rightfulowner of such shares claims the shares.

(VI) Listing with the stock exchanges

The Company's equity shares are listed on the BSE Limited (BSE)and the National Stock Exchange of India Limited (NSE). The Secured/ UnsecuredRedeemable Non-Convertible Debentures are listed on the BSE. The unsecured CommercialPapers outstanding as at March 31 2022 are listed on the NSE.

Applicable annual listing fees for the year 2021-22 have been paid toboth the BSE and the NSE as per the invoices received by the Company.

11. ANNUAL RETURN OF THE COMPANY.

The Annual Return in Form MGT-7 of the Companies (Management andAdministration) Rules 2014 is placed on the website of the Company and can be accessed athttp://www.welspuncorp.com under the tab "Who We Are --> Polices DisclosuresNotices"

12. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

EARNINGS AND OUTGO

01. Conservation of energy:

Initiatives taken for conservation of energy its impact are as under:

Sr. No. Description of Energy Efficiency Energy Savings Savings
Improvement Measure [kWh/Annum] [Rs In million/Annum]
At Pipe Mill Anjar
1 Energy saving through replacement to LED lights replacement of 3ph Arc welding machine with DC arc welding machine Cooling tower operation Shed light time control in LSAW Coating Plants 17504 0.15
2 Energy saving by providing APFC panel for HF welding Seam Annealing in ERW plant 18512 0.16
3 Energy saving through replacement of LED lights Installation of VFD and replacement of 1.5kw stretching roller motor in Coating Plant 30310 0.26
4 Energy saving through replacement of Shade LED lights automation of hydraulic power pack in L-SAW Plant 176981 1.54
5 Energy saving through optimization usage of first pinch roll motor Provide inter locking for parallel operation Hydraulic motor replaced in Spiral-2 Plant 150380 1.30
6 Energy saving through VT pump replace with lower rating Cooling pump nozzle replace Multi-function timers in admin Gurukul and SP2 GM office ACs in Utility function. Note: Average Power cost in 21-22 including electricity Duty Rs 8.7/KWH 91439 0.79
Sub-Total 485126 4.2
At Mandya Plant

 

Sr. No. Description of Energy Efficiency Energy Savings Savings
Improvement Measure [kWh/Annum] [Rs In million/Annum]
1 Saving Continue from last year projects 23255 0.176
2 Installation of 57 no's of 150 W LED High bay fixtures for "Shed Lights" in place of 400 W HPSV Fixtures. 4032 0.0306
3 Replacement of Conventional street lights with Solar lights of 11 Nos. 652 0.005
4 Replaced 32 nos. 36 watt CFL Tube Lights with 16 nos. 18 W LED Tube lights 415 0.003
5 Installation of VFD for End Beveling main pallet trolley motor 13.75 x 2 nos. 800 0.006
6 Replacement of 400watt HPMV with 250Watt LED at High mast tower light 605 0.0046
Note- Most of the energy saving projects implemented in
Q4 2021-22 hence more outcome will come in FY 2022-23
Sub-Total 29759 0.2261

 

At Bhopal
1 Installed DAY/NIGHT sensor to auto switching for outside lights ( Coating Yard High Mast) 5609 0.03
2 Installation of Drive to run 37kw Jet Pressure pump for coating application 10656 0.08
3 Installed and commissioning of Air Regulator in Mill Plasma Cutting 23868 0.179
4 Process Cooling Tower Fan Stop during Night duration in winter season. 29640 0.22
Sub-Total 69773 0.509

02. Technology absorption and Research & Development

A. Innovation.

Automatic Enquiry Management System is made live and it is in use.

Anjar Plant:

In House Low-cost automation provided at final inspection bed at ERW16" to measure pipe length which was previously measured manually.

Plant Changeover parameter data of each project incorporated in SAP.

Face sealing system successfully executed at Hydro tester machine.

Provision of power-driven roof ventilators (10000 cfm capacity)- 20nos for Better work conditions in LSAW plant.

Bhopal Plant:

? Energy Management System implemented in Bhopal Plant to analyze thepower consumption in plant.

? Automation of Cross Seam Welding done IN-HOUSE. Now cross seamwelding can be done by single switch in SP#2.

? 2 Nos of Drives replaced in Mill Main Pinch Roll in SP#2.

? Automatic Conveyor STOP and GO provided at 6 nos. critical stationfor Human Safety in SP#2.

? UPS system installed in SP#2 to ensure power to save the failure of

High Cost Electronics System as our Plant is prone to Power Failure.

B. Research & Development carried out by the Company.

Anjar Plant:

? To improve the CVN toughness value of HF Weld Line various studieswere done and subsequent implementation based on the successful parameters were done.

? Development of online diameter measurement system the trial hastaken and found satisfactory. With more usage further improvement is expected.

? ECP-3 Plant Automation for productivity improvement.

? Development of Pipelines for the transport of Pure Hydrogen/ blendedwith Natural Gas. Carrying out the tests required for the qualification of pipelines asper ASME B31.12 standard.

? Participating in JIP program on revising the guidelines for Designand

Operation of Hydrogen Pipelines.

? Participated in subcommittee in development of Line pipespecification by Bureau of Indian Standards.

? Our company is actively involved in the ASME subcommittee ondevelopment of pipelines for

Hydrogen transportation.

? R & D being carried out for establishing Welding consumablescombination to achieve CVN values at -60? C.

? Prototype HIC & SSC Test vessel @ 1 bar gauge pressuredevelopment underway @ NASELAB.

? Development of Sour grade steel for

ERW application is being carried out along with M/s Tata steel one ofthe leading Indian steel maker.

? Continuous Coil Feeding Line for Spiral Pipes Patent granted andcertificate issued to Welspun with European patent no EP2167249A2 on 21st October 2021.

C. Technology Upgradation

Anjar Plant:

? Developed in house facility to perform Straight HAZ Weldability teston plate.

? Installation of new Pipe cut off system at ERW 16" plant toimprove plant performance resulting in enhanced end quality.

? Mill speed enhancement from 6.24 to 6.75 mpm to increase throughoutby replacement of V-belt pulley.

? Utility digital dashboard for online monitoring of Air Co2 LPGWater consumptions reports and trends analysis.

? ERW 16" Mill process parameters SAP integration &digitalization. ERW 6"

Pre-visual station parameters SAP integration.

Bhopal Plant:

? Modification in Hydrotester End Facer and Final Section to run theplant for 6 Meter pipe production.

? Installation and commissioning of External Blaster-2 at ExternalCoating.

? DFBE system installation and commissioning done for the first time inBhopal Coating Plant.

? 132 INCH 25MM pipe produced in the SP#1. Necessary modificationsdone.

? Stretching Roller installed and commissioned In House by installationof VFD and Displacement Sensor. This helps to reduce PE Material consumption by speedcontrol of stretching roller by detecting welding seam.

Mandya Plant:

? Plasma Max 200 is replaced by upgraded version of Max 200 Pro atSpiral mill.

? Automation at Cross welding system for speed synchronization ofLinear & rotational speed with reference of Pipe Size & Installed Auto Stick Outcontrol system for improvement in weld quality.

? End-facer F & T-end Pallet:

Conventional starter replaced by VFD for smooth control and energyconservation.

? Auto positioning of Offline OD-welding head on "Tab" andAuto welding start function provided.

? Hydro-tester HP Pump-2: Conventional starter replaced by VFD forbetter control & energy conservation.

D. Process & System Improvement

Anjar Plant:

? Press and Process modification at our Anjar LSAW plant to managechallenging D/T ratio and increase throughput

? De-bottlenecking at ERW 16" to increase throughput by 20%

? Centralized Air network grid establishment for cost optimization& energy saving.

? Completed Automation for Process Improvement provided at ERW 16"Body UT area to transfer pipe to MPI skid which was manual .

? Sand filtration system installed for ERW 16" Hydrostatic testermachine for machine healthiness.

? Instruments calibration process through SAP.

? Generation of MTC (Material testing certificate) through SAP for ISgrade Pipes.

? Reduction in power consumption for idle days.

a. Replacement of transparent sheet for reduce power consumption ofshade lighting.

b. Utilization of robot compressor for idle day.

c. Load optimization of pumps of plant utility.

? Installation of PE Dryer at ECP-1 to improve coating quality.

? In House development for Heat input data collection in weldingparameter graph.

Bhopal Plant:

? Increase in the productivity of Internal Coating by increasing thespeed of the buggy.

? During 18-inch API Project the automatic ratio mixing of Chromate andPhosphorous with DM water.

Installed Drive and PLC Program modification done.

Mandya Plant:

? MTC documents extracted & recorded through SAP.

? Calibration traceability system taken through SAP.

? Included IS 3589 Fe450 for specific pipe size 1685.8 mm OD x 12.9mmWT from BIS.

? Plant Illumination improved by installation of LED shed lights.

? Development of "Paper less PDF graph generation"application has been done.

? Auto Synchronization & Auto start up at OD cross welding forconsistency in better welding quality.

? Auto weld head position and auto start of OD welding for consistencyin better welding quality.

? Water consumption reduced from 8575 ltr to 6551 ltr in FY 2021-22.

? Snubber roller modification at Spiral mill for proper de-coiling andfeeding of lower weight coils.

? Strengthening bottom assembly of butt joint system for improve coiljoining Process.

Coil Car Lifting plate & Guide rod modification for enhancingsafety standard during coil movement.

E. Key Initiatives for Future

Anjar Plant:

? Implementation of ESG project (Environment Social Governance)(Energy saving by VFD installation LED lights power factor improvement).

? Plan to Installation of solar park at Anjar to promote RenewableEnergy.

? Development of the software for HSE Management System.

? SAVE WATER conservation project:

Process RO & drinking RO reject water utilization for gardeningpurpose at Anjar Campus-1 plant.

? HFW Plant o Yield improvement by various initiatives of Internal and

External factors.

o Spectrometer automation to transfer chemical parameters valuedirectly to SAP.

o Installation of a new Squeeze roll force measurement system to caterto the requirement of some clients like PDO SAUDI ARAMCO etc.

o Centralized operation of the slitting line from one integratedworkstation.

o Automated Pipe diameter measurement system for ERW pipes (Final).

o ERW-16 Coil UT System up gradation.

? Spiral-2 Plant o Real-Time measurement of coil width and thicknessduring uncoiling.

o Up-gradation of Spiral-2 Anjar Fluoroscopy system.

o Stop & Go assembly installation at Hydro tester (IS) entry andre-routing of hydraulic piping accordingly for smooth movement of large diameter pipe(above 80" OD).

? LSAW Plant o Pipe Diameter Measurement from inside at final.

o Automatic Bead Profile Bead height and Plate Offset Inspection.

o Up gradation of Forming Press hydraulic System.

o Up gradation of LSAW Final UT System.

o Yield improvement by various initiatives from process control.

o Hamplemann provision in sample exit bed to eliminate scratches onpipe surface.

o Provision of pull type limit s/w at left manipulator to detectfailure of manipulator chain.

o Machine profibus network converted into profinet to avoid machinebreakdowns in expander machines.

? Coating Plant o Development of facility to External coat 3LPE oninduction bends.

o Development of facility to internal diameter Bend coating.

o Development of Inspection of internal surface by high resolutioncamera.

o Installation of new 500 kW induction heater at ECP-3 for pipepre-heating before shot blaster.

o Successfully completed the qualification of our Coating facility byM/s SHELL.

Bhopal Plant:

? Modification in Hydrotester End Facer and Final Section to run theplant for 6 Meter pipe production.

? Modification in the plant for enhancing it to run the HigherThickness Higher Diameter Pipe(132" x 25 mm).

Mandya Plant:

? Water Conservation & Rain Water Harvesting project: Initiativetaken for installation of rain water harvesting project for usage of rain water in processand gardening purpose.

? Water conservation project - Sand Filter Installation forHydro-tester water re circulation to reduce process wastage.

? Water Conservation RO Drain waste water consumed for Hydro-testerprocess.

? Replacement of Conventional high bay shed Lights with 75 LED Lights.

? Initiative taken for Installation of 17 nos. Solar street lights.

? Initiative taken to replaced 16 nos. 400 watt lights by 250 watt LEDfor High mast.

? Initiative taken to install 60KW x 2 VFD for Compressors for energyconservation.

? Initiative taken for maximize use of

LED lights.

Expenditure on R&D

(a) Capital : NIL

(b) Recurring : Rs 25.21 Mn

(c) Total : Rs 25.21 Mn

(d) Total R&D expenditure as a percentage of revenue fromoperations : 0.05%

Total Foreign exchange: Used - Rs 13139.28 Mn Earned- Rs 13281.65 Mn

13. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Disclosures as required under Rule 9 of the Companies (Corporate SocialResponsibility Policy) Rules 2014 are annexed to this Report as "Annexure 4".

14. DIRECTORS AND KEY MANAGERIAL PERSONNEL

A) Changes in Directors and Key Managerial Personnel

Since the last report no changes took place in the Board of Directorsand Key Managerial Personnel.

In accordance with the provisions of the Companies Act 2013 and theArticles of Association of the Company Mr. Balkrishan Goenka is retiring by rotation atthe forthcoming Annual General Meeting and being eligible he has been recommended forre-appointment by the Board.

Further at the recommendation of the Nomination and RemunerationCommittee the Board of Directors of the Company have recommended re-appointment of Mr.Vipul Mathur as the Managing Director and CEO for another term of 5 years from December 12022.

Further at the recommendation of the Nomination and RemunerationCommittee and the approval of the shareholders Mr. Desh Raj Dogra has been re-appointedas an Independent Director of the Company for second term of 4 (four) years w.e.f.February 9 2022.

Details about the directors being (re)-appointed are given in theNotice of the forthcoming Annual General Meeting which is being sent to the members alongwith the Annual Report.

B) Independent Directors

The independent directors have individually declared to the Board thatthey meet the criteria of independence as provided under Section 149(6) of the CompaniesAct 2013 at the beginning of the year and there is no change in the circumstances as onthe date of this Report which may affect their status as an independent director.

Your Board confirms that in their opinion the independent directorsfulfill the conditions of the independence as prescribed under the SEBI (LODR) 2015 andthey are independent of the management. Further in the opinion of the Board theindependent directors possess requisite expertise experience and integrity. All theindependent directors on the Board of the Company are registered with the Indian Instituteof Corporate Affairs Manesar Gurgaon as notified by the Central Government under Section150(1) of the Companies Act 2013 and shall undergo online proficiency self-assessmenttest as may be applicable within the time prescribed by the IICA.

The key criteria for independence are mapped as under:

Key Independence Criteria AM DRD KHV RA
1. The director must not have been employed by the Company in an executive capacity within the last five years. ? ? ? ?
2. The director must not accept or have a "Family Member who accepts any payments from the company or any parent or subsidiary of the company in excess of $60000 during the current fiscal year" other than those permitted by SEC Rule 4200 Definitions including i) payments arising solely from investments in the Company's securities; or ii) payments under non-discretionary charitable contribution matching programs. Payments that do not meet these two criteria are disallowed ? ? ? ?
3. The director must not be a "Family Member of an individual who is or during the past three years was employed by the Company or by any parent or subsidiary of the Company as an executive officer. ? ? ? ?
4. The director must not be (and must not be affiliated with a company that is) an adviser or consultant to the Company or a member of the Company's senior management ? ? ? ?
5. The director must not be affiliated with a significant customer or supplier of the Company ? ? ? ?
6. The director must have no personal services contract(s) with the Company or a member of the Company's senior management ? ? ? ?
7. The director must not be affiliated with a not-for-profit entity that receives significant contributions from the Company ? ? ? ?
8. The director must not have been a partner or employee of the Company's outside auditor during the past three years ? ? ? ?
9. The director must not have any other conflict of interest that the board itself determines to mean they cannot be considered independent ? ? ? ?

C) Formal Annual Evaluation

Background:

The performance evaluation of the Board its committees and individualdirectors was conducted by the entire Board (excluding the Director being evaluated) onthe basis of a structured questionnaire which was prepared after taking into considerationinputs received from the Directors covering various aspects of the Board'sfunctioning viz. adequacy of the composition of the Board and its Committees time spentby each of the directors; accomplishment of specific responsibilities and expertise;conflict of interest; integrity of the Director; active participation and contributionduring discussions and governance.

Mode of evaluation:

Assessment is conducted through a structured questionnaire. Eachquestion contains a scale of 0 to 3. The Company has developed an in-house digitalplatform to facilitate confidential responses to a structured questionnaire. All thedirectors participated in the evaluation process.

For the financial year 2021-22 the annual performance evaluation wascarried out by the Independent Directors Nomination and Remuneration Committee and theBoard which included evaluation of the Board Independent Directors Non-independentDirectors Executive Directors Chairman Committees of the Board Quantity Quality andTimeliness of Information to the Board.

Results:

The evaluation results were discussed at the meeting of Board ofDirectors Nomination & Remuneration Committee and the Independent Directors meeting.The Directors were satisfied with the overall corporate governance standards Boardperformance and effectiveness. The results are summarized below:

Key parameters No. of evaluation parameters Score %
Board of Directors ? Board structure and composition 20 91%
? Board meeting practices (agenda frequency duration)
? Functions of the Board (Strategic direction etc.)
? Quantity quality & timeliness of information
? Board culture and effectiveness
? Functioning of Board Committees
? Director induction and development programs
Board Committees ? Composition roles & responsibilities and effectiveness of the committee 7-10 86-96%
? Meeting structure and information flow
? Contributions to Board decisions
Independent directors ? Independence from company (no conflict of interest) 8 84-94%
? Independent views and judgement
? Objective contribution to the Board deliberations
Chairperson ? Promote effective decision-making 6 97%
? Encourage high quality of constructive debate
? Open-minded and listening to the members
? Effectively dealing with dissent and work constructively towards consensus
? Shareholders' interest supreme while taking decisions.
Executive Directors ? Relevant industry experience 9 93%
? Performance vis-a-vis business plan
? Capabilities to deal with challenging situations
? Established leadership position
? Development of expertise and general competence of people under him
Non- executive non- independent director ? Contribution to the Board discussions with his/her expertise and experience 8 90-98%
? Depth of understanding about the business model and the industry

 

Board of Directors
Parameters with high performance scores: ? Key suggestions / focus areas:
? Well informed decisions with clear insight in to the Company's business ? Re-visiting the Board and the Committee evaluation questionnaire to increase the depth to identify gaps in the system more focus on ESG and taking care of change in the business and regulatory framework (Action Plan Undertaking external bench-marking engagement of experts and revising the evaluation questionnaire).
? Adequate allocation of meeting time on management presentation and discussion
? Independent Directors were facilitated to freely participate and express their views.
? Sensitive to the interest of all stakeholders including minority shareholders and has adequate mechanism to communicate with them. ? Re-assess Board composition and diversity with the objective of further strengthening the Board by inducting domain specialists in the new business areas of the Company (Action Plan-Develop long term Board succession plan considering diversity domain expertise).
? Efforts should be made by all the directors to attend the meetings of the Board and Committees regularly (Action Plan Fixing adhering to the Annual calendar for Board and Committee meetings).
Board Committees
Parameters with high performance scores: Key focus areas for next year:
? Size composition and diversity of each committee ? Review the process for evaluation of ESG risks and opportunities that may materially affect the Company's Enterprise Risk Management (ERM) Program need to be strengthen (Action Plan Strengthen the process for review and evaluation of ESG risks and opportunities)
? Strong oversight on financial reporting process internal financial controls compliance with related party transactions regulations whistle blower & vigil mechanism and reporting to Board on key control gaps
? Performance monitoring of subsidiaries ? Review the process evaluating the Company's risk appetite and specific risk tolerance levels in conjunction with strategic objectives (Action Plan- Focussed discussion on the Company's risk appetite and specific risk tolerance levels in conjunction with strategic objectives
? Effective process of selection of new directors and well-defined board evaluation framework
? Adequacy of information and effective monitoring of security transfer system
? Monitoring of actions taken on key issues
? Discussion on emerging issues and risks
? Effective Communication between the Committees and the executives to discuss the issues within the Committee's scope

Key actions taken as a result of previous year's evaluation:

More training opportunities were provided to the independent directorson the emerging issues.

Time allocation between the agenda items to strive balance.

The Composition of the Board of subsidiaries formed / acquired for newbusinesses have been reconstituted considering the long term objectives.

Key insights on strategic agenda items are provided well in advance.

Revised Whistle Blower Policy and Vigil Mechanism implemented.

Revised the process for appointment and remuneration of KMP and SMP.

D) Committees of the Board of Directors

Information on the Audit Committee the Nomination and RemunerationCommittee the Stakeholders'

Relationship Share Transfer and Investor Grievance Committee the RiskManagement Committee and the ESG & CSR Committee (erstwhile Corporate SocialResponsibility Committee) and meetings of those committees held during the year underReport is given in the "Corporate Governance Report" annexed to the AnnualReport as "Annexure 5".

15. PARTICULARS OF OUTSTANDING LOANS GUARANTEES AND INVESTMENTS UNDERSECTION

186 ARE AS UNDER:

( Rs in Mn)

Name of the Entity / beneficiary Investment Joint Bonds Corporate Guarantee Loans
Welspun Pipes Inc. 0.44
Welspun Tradings Limited 50.22
Welspun Captive Power Generation Limited 765.79
Welspun Mauritius Holdings Limited* 298.46
Welspun Wasco Coatings Private Limited (provision made) 254.65 86.70 247.01
Welspun Metallics Limited 2981.94 2832.60 5750.00 2490.78
Welspun DI Pipes Limited 2095.68 4676.40 7500.00
Welassure Services Limited 1.16
Welspun Global Services Limited 0.02
Welspun Mahatva Plastic Products And Building Materials Private Limited 4010.10
Anjar TMT Steel Private Limited 448.25 1500.00
Welspun Specialty Solutions Limited 2836.50 2123.60 886.34

* Investment carried at fair value through profit and loss.

Justification for providing loans / guarantee / investment.

The corporate guarantees were given to secure credit facilities availedby the subsidiaries / joint ventures of your Company to guarantee export obligations ofthe subsidiaries / joint ventures to the custom authorities and to guarantee performanceof the subsidiaries of the Company.

The Long-term investments are made only in subsidiaries joint-venturesand associate companies for business expansion business transformation as per the objectclause in the Memorandum of the Company.

16. PARTICULARS OF CONTRACTS OR

ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the yearunder Report were on an arm's length basis and were in the ordinary course ofbusiness. There were no materially significant related party transactions undertaken bythe Company with Promoters Directors Key Managerial Personnel or other designatedpersons which might have a potential conflict with the interest of the Company at large.

The Company's policy on Related Party Transactions as approved bythe Board is uploaded on the Company's website at "http://www.welspuncorp.com"under the tab "Who We Are --> Polices Disclosures Notices".

Save and except as disclosed in the financial statements none of theDirectors or Key Managerial Personnel had any pecuniary relationships or transactionsvis-a-vis the Company.

Accordingly the disclosure of related party transactions as requiredunder Section 134(3)(h) of the Act in Form AOC-2 is not applicable to the Company forfinancial year 2021-22 and hence does not form part of this report. Details of relatedparty transactions entered into by the Company in terms of Ind AS-24 have been disclosedin the Note No. 42 of the standalone financial statements.

17. MANAGERIAL REMUNERATION a. Details of the ratio of theremuneration of each director to the median employee's remuneration and other detailsas required pursuant to Rule 5(1) oftheCompanies(AppointmentandRemuneration of ManagerialPersonnel) Rules 2014.

Non-executive independent directors are paid sitting fees at a fixedrate per meeting of the Board or the Committee attended by them and as such the samecannot compared with the remuneration to the employees.

(i) The ratio of the remuneration of each director to the medianremuneration of the employees of the Company for the financial year:

Director's name For the period Ratio with reference to median remuneration of the employees
Mr. Vipul Mathur 01.04.2021 to 31.03.2022 164.5

(ii) The percentage increase in remuneration of each director ChiefFinancial Officer Chief Executive Officer Company Secretary or Manager if any in thefinancial year ended March 31 2022 : Managing Director & CEO: 34% CFO:39% and CS :31% since the previous year numbers were reduced due to Covid pandemic related reduction.

(iii) The percentage increase in the median remuneration of employeesin the financial year: 4.4%.

(iv) The number of permanent employees on the rolls of the Company:1714.

(v) Variations in the market capitalization of the

Company price earnings ratio as at the closing date of the currentfinancial year and previous financial year and percentage increase over decrease in themarket quotations of the shares of the company in comparison to the rate at which theCompany came out with the last public offer in case of listed companies and in case ofunlisted companies the variations in the net worth of the Company as at the close of thecurrent financial year and previous financial year :

The market cap of the Company increased from Rs 36093.36 Mn to Rs43682.93 Mn after taking in to consideration the buyback of equity shares and allotmentunder ESOP Scheme during the financial year. The P/ E ratio changed from 3.61 times to 9.1times. The share price increased by 1071.80% in comparison to the rate at which theCompany came out with the public issue in February 1997 (after taking in to considerationthe reorganization of share capital done in March 2005 but without considering othercorporate actions not resulting in to any material change in the share capital).

(vi) Average percentage increase /(decrease) already made in thesalaries of employees other than the managerial personnel in the last financial year andits comparison with the percentage increase/ (decrease) in the managerial remuneration andjustification thereof and point out if there are any exceptional circumstances forincrease in the managerial remuneration: Aggregate remuneration of employees excluding KMPincreased by 14.8%. Change in the remuneration of the KMP increased by 34.4%.

(vii) The key parameters for any variable component of remunerationavailed by the directors:

1) Cash PAT

2) Operating Cash-Flow

3) Gross Debt

4) ESG Goals b. Details of the top ten employees in terms ofremuneration drawn and the name of every other employee as required pursuant to Rule 5(2)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is asunder:

Name Designation DOB (mm/dd/ yyyy) Age Joining Date (mm/ dd/yyyy) Remuneration FY 21-22 Previous Company Qualification Nature of Employment % Of Equity Shares held in the Company Relative of any Director/ Manager of the Company
Vipul Mathur Managing Director & CEO 3/21/1970 52 2/2/2001 59004022 Man Industries (India) Ltd MBA Permanent Negligible No
Godfrey John Director# 8/30/1965 56 6/11/2012 28945528 Ferro Tech India Pvt. Ltd. MBA Permanent Negligible No
Percy Birdy President 1/22/1968 54 6/11/2018 17976000 Allanasons Group CA Permanent Nil No
Tribhuwan Singh Kathayat President 1/10/1971 51 6/20/1996 14683214 Jindal Organization BSC/DME/ MBA Permanent Negligible No
Suresh Chander Darak President 1/2/1968 54 1/2/2008 11943507 Reliance Industries Ltd. B. Com/ DITM Permanent Nil No
Navin Agarwal Senior Vice President 1/1/1972 50 6/2/2008 11930352 Mahindra & Mahindra Ltd. PGDBM Finance/B. Com (Hons) Permanent Nil No
Atul Trivedi Senior Vice President 1/3/1974 48 5/14/2007 11180743 Tata Consultancy CA Permanent Nil No
Manish Pathak President 1/20/1968 54 6/26/2008 11028623 Man Industries (India) Ltd BE Mech Permanent Nil No
Gaurav Merchant Vice President 9/11/1973 48 1/15/2014 9823021 Essar Steel Limited B. Com/MBA Permanent Nil No
Rupak Ghosh Senior Vice President 10/17/1969 52 10/29/2007 9736501 Blue Star Limited ICWA/ CA Permanent Nil No
Nitin Agarwal Vice President 2/6/1983 39 4/20/2007 9604936 Welspun Tubular LLC MBA/PGDM Permanent Nil No
Anil Nimbargi Senior Vice President 10/13/1965 56 9/9/2009 8570519 - B.sc + MBA Permanent Nil No
Bidisha Banerjee Vice President 1/18/1980 42 7/9/2018 8113126 Future Group MBA Permanent Nil No
Nitin Goyal* Vice President 12/24/1981 40 1/24/2022 2025000 Ernst & Young B.Com(Hons)+ ICWA+CA+ LLB+DISA Permanent Nil No
Harishchandra Gupta Senior Vice President 2/5/1966 56 4/7/2007 7842866 Idea cellular Ltd. M. Com/ LLB/ MBA Permanent Nil No

* Employed for a part of the year.

# Not on the board of the Company.

c. Managing Director of the Company was not in receipt of anycommission from the Company and at the same time remuneration or commission from theCompany's Subsidiary Company.

d. Particulars of remuneration to the executive directors including thedetails of remuneration paid/payable to the executive directors for the financial year2021-22 are as under:

Name of the Director Salary & Allowance Perqui- sites Commi- ssion Service Contract/ Tenure performance linked incentives Notice Period Severance Fees Stock Option Pension
1 Mr. Vipul Mathur Rs 58.75 Mn^ Nil Nil 5 years Nil 1 month Nil Refer note below Nil

^ In addition to salary & allowance entitled for other benefits asper the Company's policy.

Note: 1500000 Employee Stock Options granted during FY 2018-19 at anexercise price of Rs 100 per option and can be exercised as per the vesting schedule givenunder the Welspun Employee Stock Option Plan which is 30% 35% and 35% each year from theend of 1st year from the grant date. No ESOPs exercised so far.

Mr. Balkrishan Goenka Non-Executive Chairman was paid Commission of Rs52.92 Mn (Gross) i.e. @1% of the Net Profits (standalone) for the Financial Year 2020-21in terms of the approval granted by the members of the Company at the 26th Annual GeneralMeeting held on August 31 2021. The Commission payable @1% of the Net Profits(Consolidated) for the financial year 2021-22 is Rs 30.67 Mn.

No remuneration or perquisite was paid to and no service contract wasentered into with or stock options granted to any non-executive director but the sittingfees were paid / payable to the following directors for attending meetings of

Board / Committees of the Board and General Meetings. Only Letter ofAppointment were issued to the independent directors.

Name of the Director (Rs)
1 Ms. Amita Misra 1770000
2 Mr. Desh Raj Dogra 2136000
3 Mr. K. H. Viswanathan 3838000
4 Ms. Revathy Ashok 1628000
Total to Non-Executive Directors 9372000

The above mentioned sitting fee paid / payable to the non-executivedirectors was within the limits prescribed under the Companies Act 2013 for payment ofsitting fees. Hence prior approval of the members as stipulated under Regulation 17(6) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 was notrequired.

18. SHAREHOLDING OF THE DIRECTORS OF THE COMPANY AS ON MARCH 31 2022

For detail of shareholding of the directors refer to the"Corporate Governance Report" annexed to this Report.

Except as mentioned in the "Corporate Governance Report"none of the other directors hold any shares or convertible securities in the Company.

19. CORPORATE GOVERNANCE CERTIFICATE

The Compliance certificate obtained from M/s. Mihen Halani &Associates Practicing Company Secretary regarding compliance of conditions of corporategovernance as stipulated under Chapter IV read with relevant Schedule to the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed with this Report.

20. RISK MANAGEMENT POLICY

With its fast and continuous expansion in different areas of businessesacross the globe the Company is exposed to a plethora of risks which may adversely impactgrowth and profitability. The Company recognizes that risk management is of concern to alllevels of the businesses and requires a structured risk management policy and processesinvolving all personnel. With this objective the Company had formulated structured RiskManagement Policy thereby to effectively address those risks such as strategic businessregulatory and operational risks including cyber security & Data Privacy risks. ThePolicy envisages identification of risks by each business segment and location togetherwith the impact that these may have on the business objectives.

It also provides a mechanism for categorization of risks into LowMedium and High according to the severity of risks. The risks identified are reviewed by acommittee of the Managing Director & CEO of the Company and the relevant seniorexecutives and the appropriate actions for mitigation of risks are advised; the riskprofile is updated on the basis of change in the business environment. The Risk ManagementCommittee periodically reviews the risk management process risks and mitigation plansand provide appropriate advise in the improvement areas if any identified during thereview.

For the key business risks identified by the Company please refer tothe Management Discussion and Analysis annexed to this Report.

21. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS

The details of familiarization program (for independent directors) aredisclosed on the Company's website and a web link thereto is"http://www.welspuncorp.com" under the tab "Who We Are --> PolicesDisclosures Notices".

During the reporting year on a cumulative basis the independentdirectors spent 74 (approx) hours on several familiarization program. During the year theCompany also conducted separate sessions on ESG familiarization new businessfamiliarization for directors as part of the committee meetings.

22. CODE OF CONDUCT

The Company has a Code of Conduct for the Board members and SeniorManagement Personnel. A copy of the Code has been put for information of all the membersof the Board and management personnel on the Company's website "http://www.welspuncorp.com"under the tab "Who We Are --> Polices Disclosures Notices".

All the members of the Board and the Senior Management Personnel haveaffirmed compliance with the same.

A declaration signed by the Managing Director & CEO of the Companyis given below:

I hereby confirm that the Company has obtained from all the members ofthe Board and the Senior Management Personnel affirmation that they have complied withthe Code of Conduct for the financial year 2021-22.

Sd/-

Vipul Mathur

Managing Director& CEO

DIN: 07990476

23. MISCELLANEOUS DISCLOSURES

Except as mentioned in this Report with respect to acquisitions ofspecial purpose vehicles for organic / inorganic growth of the businesses under theobjects of the Company during the year under Report there was no change in the generalnature of business of your Company.

Except as mentioned in this Report no material change or commitmenthas occurred which would have affected the financial position of your Company between theend of the financial year of your Company to which the financial statements relate and thedate of the Report.

No significant and material order was passed by the regulators orcourts or tribunals which would have impacted the going concern status and your

Company's operations in future.

There are no proceedings either filed by the Company or filed againstthe Company pending under the Insolvency and Bankruptcy Code 2016 as amended before theNational Company Tribunal or other Courts as at the end of the Financial Year 2021-22.

Your Company has not made any provision of money for the purchase ofor subscription for shares in your Company to be held by or for the benefit of theemployees of your Company and hence the disclosure as required under Rule 16(4) of theCompanies (Share Capital and Debentures) Rules 2014 is not required.

The Board of Directors affirms that the Directors have devised propersystems to ensure compliance with the provisions of all applicable Secretarial Standardsissued by the Institute of

Companies Secretaries of India and that such systems are adequate andoperating effectively. The Company has complied with the applicable Secretarial Standards.

The Company has complied with provisions relating to the constitutionof Internal Complaints

Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. The ICC comprises of internal as wellexternal members.

Disclosure of number of complaints filed disposed of and pending inrelation to the Sexual

Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 as on the end of the financial year under Report are as under:

? number of complaints filed during the financial year Nil

? number of complaints disposed of during the financial year : N/A

? number of complaints pending as on end of the financial year Nil

24. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Sections 134(3)(c) & 134(5) of the Companies Act 2013your directors hereby confirm that: a. in the preparation of the annual accounts theapplicable accounting standards had been followed along with proper explanation relatingto material departures;

b. 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 and of the profit and loss of the Company for that period;

c. the directors had taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;

d. the directors had prepared the annual accounts on a going concernbasis;

e. being a listed company the directors had laid down internalfinancial controls to be followed by the Company and that such internal financial controlsare adequate and were operating effectively; and

f. the directors had devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.

ACKNOWLEDGEMENTS

Your directors express their deep sense of gratitude to allstakeholder bankers business associates contractors customers employees governmentauthorities joint venture partners suppliers for the support received from them duringthe year and look forward to their continued assistance in future.

For and on behalf of the Board of Directors
Vipul Mathur Balkrishan Goenka
Managing Director & CEO Chairman
DIN : 07990476 DIN: 00270175
Date: May 27 2022
Place: Mumbai

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