DIRECTORS' REPORT
Your Directors are pleased to present the 61st Annual Report and the Audited
Financial Statements of the Company for the financial year ended 31st March
2023.
Financial Results
|
(Amount in Rs. crore) |
|
FY 2022-23 |
FY 2021-22 |
1. Revenue from operations |
2,676.39 |
2,602.95 |
2. Other Income |
25.66 |
18.06 |
3. Total Income |
2,702.05 |
2,621.01 |
4. Profit before finance cost, depreciation, taxation and exceptional
items |
514.48 |
828.83 |
5. Finance Cost |
68.42 |
61.55 |
6. Depreciation |
107.28 |
110.22 |
7. Exceptional items |
15.70 |
- |
8. Profit before Tax |
323.08 |
657.06 |
9. Tax including Deferred Tax |
97.35 |
149.19 |
10. Profit after Tax |
225.73 |
507.87 |
11. Other Comprehensive Income/(Expenses) |
(0.29) |
(1.33) |
12. Total Comprehensive Income/(Expenses) for the year |
225.44 |
506.54 |
13. Dividend paid |
67.44 |
32.37 |
14. Balance carried forward |
1,804.90 |
1,646.90 |
Your Company's revenue from operations during the year under review reached a new high
of Rs.2,676.39 crore (previous year: Rs.2,602.95 crore) including highest ever foreign
exchange earnings of Rs.2,522.67 crore (previous year: Rs.2,441.71 crore). However, EBITDA
before exceptional items decreased to Rs.514.48 crore (previous year: Rs.828.83 crore) and
profit after tax stood at Rs.225.73 crore (previous year: profit of Rs.507.87 crore) due
to commodity prices cooling off while input costs remained high.
Dividend
Pursuant to the provisions of Regulation 43A of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, as amended, the Company has formulated a
Dividend Distribution Policy. The Policy sets out the parameters and circumstances that
will be taken into account by the Board in determining the distribution of dividend to its
shareholders.
The policy has been uploaded on the website of the Company and can be accessed at
https://www.imfa.in/ pdfs/Dividend-Distribution-Policy.pdf.
Interim Dividend
The Board of Directors in its meeting held on 27th October 2022 had approved
payment of interim dividend of Rs.5/- per Equity Share (@ 50%) on of 5,39,54,106 Equity
Shares of the Company of face value of Rs.10/- each fully paid-up, out of the profits for
FY 2022-23. Interim dividend was paid to the shareholders as per their entitlement as on
the Record Date i.e 4th November 2022.
Final Dividend
In view of the excellent performance during the year under review, your Directors are
pleased to recommend a final dividend of Rs.5/-per equity share (@ 50 %) on 5,39,54,106
equity shares of face value of Rs.10/- each for the year ended 31st March 2023,
subject to approval of shareholders at the forthcoming Annual General Meeting of the
Company. Final dividend, if approved by the shareholders, taken together with the interim
dividend, will amount to total dividend of Rs.10/- per equity share for FY 2022-23.
State of Company's Affairs Operations
The production of ferro chrome during the year under review was at 244,505 tonnes
(previous year: 246,175 tonnes) while electricity generation stood at 1074 MUs including
6.14 MUs from solar (previous year: 1085 MUs including 5.80 MUs from solar) and chrome ore
raising was 564,775 tonnes (previous year: 559,356 tonnes).
It is pertinent to note that your Company has consistently followed in letter and
spirit the practice of value addition with ore raised from its mines being used only for
captive consumption, thus creating employment and maximising contribution to the
exchequer.
Utkal 'C' Compensation
During the year under review, Company's subsidiary viz Utkal Coal Limited has received
the compensation of Rs.20.69 crore towards reimbursement of statutory expenses from
Ministry of coal for its Utkal 'C' coal block, consequent upon the issuance of its vesting
order to the new allottee. Valuation of leasehold land is in progress, and balance
compensation amount is expected shortly.
Annual Return
The extract of annual return as required under Section 92(3) of the Companies Act, 2013
and Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on
the website of the Company at http://www. imfa.in/pdfs/Annual-Return-2021-22.pdf.
Number of Meetings of the Board
The Board met four times in financial year 2022-23 viz. on 24th May, 2022,
26th July, 2022, 27th October, 2022 and 30th January,
2023. The maximum interval between any two meetings did not exceed 120 days. The details
of the composition of the Board and its Committees and of the Meetings held and attendance
of the Directors at such Meetings are provided in the Corporate Governance Report.
Directors' Responsibility Statement
Pursuant to provisions of section 134(5) of the Companies Act, 2013, your Directors
hereby confirm:
(i) that in the preparation of the annual accounts for the financial year ended 31st
March 2023, the applicable accounting standards read with requirements set out under
Schedule III of the Companies Act, 2013 have been followed and there are no material
departures from the same;
(ii) that they have selected such accounting policies and applied them consistently and
made judgments and estimates that were reasonable and prudent so as to give a true and
fair view of the state of affairs of the Company at the end of the financial year and of
the profit for the year under consideration;
(iii) that they have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013 for
safeguarding the assets of the Company and for preventing and detecting frauds and other
irregularities;
(iv) that they have prepared the annual accounts of the Company for the financial year
ended 31st March 2023 on a going concern basis;
(v) that they have laid down internal financial controls to be followed by the Company
and that such internal financial controls are adequate and were operating effectively; and
(vi) that they had devised proper system to ensure compliance with the provisions of
all applicable laws and that such systems were adequate and operating effectively.
Declaration given by Independent Directors
The Independent Directors have given declaration that they meet the criteria specified
under section 149(6) of the Companies Act, 2013 and regulation 25(8) of SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) and
relevant provisions of Rule 6 of the Companies (Appointments and Qualifications of
Directors) Rules, 2014. The Board is of the opinion that the Independent Directors of the
Company possess requisite qualifications, experience and expertise in their respective
fields and they hold highest standards of integrity.
Business Responsibility and Sustainability Report
In terms of amendment dated May 05, 2021 to Regulation 34(2)(f) of the Listing
Regulations, the Company has prepared Business Responsibility and Sustainability Report
(BRSR) for the year 2022-23 on Environment, Social and Governance (ESG) parameters in the
prescribed format as Annexure -1 and forms integral part of the Annual Report.
Policy on Directors' Appointment and Remuneration
The Company has a policy for remuneration of Directors, Key Managerial Personnel and
Senior Management Personnel as well as well-defined criteria for the selection of
candidates for appointment to the said positions which has been approved by the Board. The
Policy broadly lays down the guiding principles for determining qualifications, positive
attributes, independence of a Director and other matters provided under sub-section (3) of
section 178 of Companies Act, 2013.
During the year under review, no changes were made in the above policy. Salient
features of this policy are enumerated in the Corporate Governance Report which forms part
of the Annual Report. The above policy is available at the website of the Company at :
https://www.imfa.in/pdfs/ Nomination-Remuneration-Policy.pdf
Auditors and Auditors' Report Statutory Auditors
In terms of Section 139 of the Companies Act, 2013, read with the Companies (Audit and
Auditors) Rules, 2014, Members of the Company at 57th Annual General Meeting
held on 17th July, 2019 approved the appointment of M/s SCV & Co LLP,
Chartered Accountants (Firm Registration No.000235N/ N500089) as the Statutory Auditors of
the Company for an initial term of 5 years i.e. from the conclusion of 57th Annual
General Meeting till the conclusion of 62nd Annual General Meeting of the
Company. The Statutory Auditors have confirmed they are not disqualified from continuing
as Auditors of the Company.
There are no qualifications, reservations or adverse remarks or disclaimers made in
their audit report. The Auditors of the Company have not reported any fraud as specified
under section 143(12) of the Companies Act, 2013.
The Auditor's in their report to the members, have stated one "Emphasis of
matter" and the response of your Directors are as follows:
The "Emphasis of matter" |
Board's Comment: |
paragraph which is part of Independent Auditor's Report is produced
below: |
As the Company is hopeful of receiving the compensation amount,
pending which no accounting adjustments have been made in its books of accounts. |
"Note Nos. 43 and 44 to the Standalone Ind AS Financial
Statements relating to the Company's exposure in its subsidiary and non-recognition of
income from interest on unsecured loan given to the subsidiary respectively. |
|
These matters have arisen out of the cancellation of allotment of
the coal block being held by the subsidiary vide the Hon'ble Supreme Court of India's
order dated 24th September 2014 and subsequent events in connection therewith." |
Further, pending the determination of compensation to be received from
the Nominated |
|
Authority, the Company has postponed recognition of income from
interest on unsecured loan given to UCL. |
|
The interest income would be considered as revenue in the year of
settlement of compensation. |
Secretarial Auditor
The Company has appointed M/s Sunita Jyotirmoy & Associates, Company Secretaries to
conduct secretarial audit and their Report is appended to this Report as Annexure-2.
There are no qualifications, reservations or adverse remarks or disclaimers made in
their secretarial audit report.
Cost Auditor
Pursuant to section 148 of the Companies Act 2013, the Board of Directors on the
recommendation of Audit Committee appointed M/s S S Sonthalia & Co., Cost Accountants
as the Cost Auditors of the Company for the Financial Year 2022-23 and has recommended
their remuneration to the Shareholders for their ratification at the ensuing Annual
General Meeting. M/s S S Sonthalia & Co., Cost Accountants have given their consent to
act as Cost Auditors and also certified that they are free from any disqualifications
specified under Section 141 of the Companies Act, 2013. Pursuant to Companies (Cost
Records and Audit) Rules, 2014, the Cost Audit Report for the financial year 2021 was
filed with the Ministry of Corporate Affairs on 16th August 2022 vide SRN
F22036495. The Company has maintained the cost records as specified under sub-section (1)
of section 148 of the Companies Act, 2013.
Particulars of Loans, Guarantees or Investments Under Section 186
The details of loans, guarantees and investments covered under the provisions of
Section 186 of the Companies Act, 2013 are set out below:
Amount Outstanding as on March 31, 2023
|
(Rs. crore) |
Particulars |
Amount |
Loans Given |
243.51 |
Guarantees Given |
3.99 |
Investments Made |
115.52 |
Loans, Guarantees given or Investments made during FY 2022-23
|
|
|
|
(H crore) |
Name of the Entity |
Relation |
Amount |
Particulars of Loans, Guarantees given or Investments made |
Purpose for which the loans, guarantees and investments are
proposed to be utilised |
Utkal Coal Limited |
Subsidiary |
0.16 |
Loan given |
Operational needs |
Utkal Coal Limited |
Subsidiary |
20.69 |
Loan repaid |
|
Particulars of Contracts or Arrangements with Related Parties
There are no contracts/arrangements/transactions which are not at arm's length basis
and there are no material contracts/arrangements/transactions which are at arm's length
basis. Accordingly, particulars of contracts or arrangements with related parties referred
to in Section 188(1) along with the justification for entering into such contract or
arrangement in Form AOC-2 does not form part of the report. The disclosure on related
party transactions as per Ind AS-24 has been provided under Note of the standalone &
consolidated financial statements.
Material Changes and Commitments Affecting the Financial Position of the Company
There are no material changes and commitments affecting the financial position of the
Company which have occurred between the end of the financial year to which the financial
statements relate and the date of the report.
Energy Conservation, Etc.
The information required under section 134 of the Companies Act, 2013 read with
Companies (Accounts) Rules, 2014 are set out in Annexure-3 hereto forming part of
this report.
Risk Management Policy
The Company has a Risk Management framework in place which is designed to identify,
assess and monitor various risks related to key business and strategic objectives and lead
to the formulation of a mitigation plan. All identified risks are categorised based on a
matrix of likelihood of occurrence and impact thereof and a mitigation plan is worked out
to the extent possible. Major risks in particular are monitored regularly at meetings of
the Risk Management Committee and the Board of Directors of the Company is kept abreast of
such issues.
Corporate Social Responsibility (CSR)
The details about the development of CSR Policy and initiatives taken by the Company on
Corporate Social Responsibility during the year as per Companies (Corporate Social
Responsibility Policy) Rules, 2014 have been appended as Annexure-4 to this Report.
The CSR Policy of the Company is hosted on the Company's website at
http://www.imfa.in/pdfs/CSR-Policy.pdf
Annual Evaluation by the Board
The evaluation framework for assessing the performance of Directors comprises of the
following key areas:
(i) Attendance of Board and Committee Meetings
(ii) Quality of contribution to Board deliberations
(iii) Strategic perspectives or inputs regarding future growth of Company and its
performance
(iv) Providing perspectives and feedback going beyond information provided by the
management
(v) Commitment to shareholder and other stakeholder interests
The evaluation involves Self-Evaluation by the Board Member and subsequently assessment
by the Board of Directors. A member of the Board will not participate in the discussion of
his/her evaluation.
Disclosure Under Section 197(12) of the Companies Act, 2013
Pursuant to Section 197(12) of the Companies Act, 2013 read with Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, the ratio of remuneration of each
Director to the median employee's remuneration and such other details are furnished below:
(i) the ratio of the remuneration of each Director to the median remuneration of the
employees of the Company for the financial year 2022-23:
Name of the Director |
Ratio |
Name of the Director |
Ratio |
Mr Nalini Ranjan Mohanty |
2:1 |
Mr Sudhir Prakash Mathur |
2:1 |
Mr Baijayant Panda |
180:1 |
Mr Bijoy Kumar Das |
2:1 |
Mr Subhrakant Panda |
192:1 |
Mrs Latha Ravindran |
2:1 |
Mr Chitta Ranjan Ray |
10.89:1 |
Mr Stefan Georg Amrein |
0.06:1 |
(ii) the percentage increase in remuneration of each Director, Chief Financial Officer
& Company Secretary and Chief Executive Officer, in the financial year:
Name of the Director |
% increase/ decrease |
Name of the Director/CFO&CS |
% increase |
Mr Baijayant Panda |
(33.26) |
Mr Bijoy Kumar Das |
0.76 |
Mr Subhrakant Panda |
(31.42) |
Mrs Latha Ravindran |
0.76 |
Mr Chitta Ranjan Ray |
(14.22) |
Mr Stefan Georg Amrein |
50.00 |
Mr N R Mohanty |
1.10 |
Mr Prem Khandelwal, CFO & CS |
69.46 |
Mr Sudhir Prakash Mathur |
0.42 |
|
|
(iii) the percentage increase in the median remuneration of employees in the financial
year : 12.97
(iv) the number of permanent employees on the rolls of company : 2,128
(v) average percentile increase already made in the salaries of employees other than
the managerial personnel in the last financial year and its comparison with the percentile
increase in the managerial remuneration and justification thereof and point out if there
are any exceptional circumstances for increase in the managerial remuneration:
Average percentile increase in the salaries of employees other than the managerial
personnel : 52nd
Percentile increase in the managerial remuneration : 0
(vi) The Nomination and Remuneration Committee of the Company has affirmed that the
remuneration is as per the Nomination and Remuneration Policy of the Company.
Particulars of Employees
In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rule
5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, a statement showing top ten employees in terms of remuneration drawn and
includes the name of every employee of the Company, who are in receipt of remuneration of
rupees one crore and two lakh or more during the financial year 202223 or a monthly
remuneration of rupees eight lakh and fifty thousand or more during financial year 2022-23
are provided in the Annexure-5 forming part of the Report.
Public Deposits
The Company has not accepted/renewed any public deposits during the year under review
under Section 73 of the Act read with Companies (Acceptance of Deposits) Rules, 2014.
There are no deposits that remain unclaimed.
Whistle Blower Policy
The Company has formulated a Whistle Blower Policy for Directors and employees to
report their genuine concerns, details of which have been given in the Corporate
Governance Report annexed to this Report.
Directors and Key Managerial Personnel
Mr Chitta Ranjan Ray (DIN: 00241059), Director, retires by rotation at the forthcoming
Annual General Meeting of the Company and is eligible for re-appointment.
Resolutions seeking approval of the members have been incorporated in the notice of the
forthcoming Annual General Meeting. Brief resume/details relating to Directors who are to
be appointed/re-appointed are furnished in the Explanatory Statement to the Notice of the
ensuing Annual General Meeting as required under the Code of Corporate Governance.
Transfer of amounts to Investor Education and Protection Fund
Pursuant to the provisions of Section 124 of the Act, Investor Education and Protection
Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (" I EPF
Rules") read with the relevant circulars and amendments thereto, the amount of
dividend remaining unpaid or unclaimed for a period of seven years from the due date is
required to be transferred to the Investor Education and Protection Fund
("IEPF"), constituted by the Central Government. The Company had, accordingly,
transferred Rs.4,52,630/-, being the unpaid and unclaimed dividend amount pertaining to FY
2014-15 to the IEPF authority.
Disclosure with respect to Unclaimed Suspense Account
Pursuant to IEPF Fund Authority (Accounting, Audit, Transfer & Refund) Rules 2016
all unclaimed shares were transferred to IEPF Authority.
All the corporate benefits in terms of securities accruing to on these unclaimed shares
shall be credited to the aforesaid account. Voting rights on these shares shall remain
frozen till the rightful owner of such shares claim the shares.
Internal Financial Control Systems and their Adequacy
The Company has a comprehensive system of internal controls that enables efficient
operations, optimal resource utilisation and compliance with all applicable laws and
regulations. Each of these internal controls strengthens the Company and protects loss or
unauthorised use of assets by providing adequate checks and balances. The Company
authorises, records and reports all transactions. An independent firm of Chartered
Accountants serves as the internal auditor to execute the internal audit functions. The
Management and Audit Committee of the Board observes and then recommends corrective
measures following such audits to improve business operations.
Corporate Governance
Pursuant to SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015,
a report on the Corporate Governance, Management Discussion and Analysis, Certificate from
Practicing Company Secretary regarding compliance of conditions of Corporate Governance
have been made a part of the Annual Report.
Significant and Material Orders Passed by the Regulators or Courts
There are no significant and material orders passed by the Regulators/Courts that would
impact the going concern status of the Company and its future operations.
Subsidiary/Joint Venture Companies
Pursuant to section 129(3) of the Companies Act, 2013, a statement containing the
salient features on the performance and financial position of each of the subsidiaries,
associates and joint venture companies included in the consolidated financial statement is
attached as Annexure-6. The audited Consolidated Financial Statements, together
with Auditors' Report, form part of the Annual Report. Pursuant to section 136 of the
Companies Act, 2013, the financial statements of the subsidiary and joint venture
companies are kept for inspection by the shareholders at the Registered Office of the
Company. The statements are also available on the Company's website (www.imfa.in).
Disclosures Under Sexual Harassment of Women at Workplace (Prevention, Prohibition
& Redressal) Act, 2013
The Company has zero tolerance policy towards sexual harassment at the workplace. The
Company has complied with the provisions relating to the constitution of Internal
Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
During the year under review, the Company have resolved one complaint which was
received during the FY22 by taking appropriate action and details of complaints
received/disposed during FY 2022-23 are provided in the Report on Corporate Governance.
Disclosure Under Insolvency and Bankruptcy Code
During the year under review there are no application made or any proceeding pending
under the Insolvency and Bankruptcy Code, 2016 (31 of 2016).
Disclosure Under One Time Settlement
During the year under review your Company has not made any one-time settlement with any
of its Banks or Financial Institutions.
Compliance With Secretarial Standards
The Board of Directors affirms that the Company has complied with the applicable
Secretarial Standards issued by the Institute of Company Secretaries of India (SS1 and
SS2) relating to Meetings of the Board, its Committees and Annual General Meetings.
Industrial Relations
During the year under review, industrial relations at the Company's manufacturing/
operational complexes located at different sites remained cordial.
Acknowledgement
Your Directors would like to place on record their sincere appreciation of the
exemplary service rendered by the entire workforce during the year under review. Further,
your Directors would also like to appreciate the support received from term lenders and
working capital bankers. Last, but certainly by no means least, your Directors would like
to thank shareholders, customers, Central and State Government and the public at large for
their continued support and confidence.
|
|
For and on behalf of the Board |
|
Sd/- |
Sd/- |
|
(Subhrakant Panda) |
(Chitta Ranjan Ray) |
Date: 30th May, 2023 |
Managing Director |
Whole-time Director |
Place: Bhubaneswar |
DIN:00171845 |
DIN:00241059 |
|