Dear Shareholders,
The Board of Directors hereby submits the 47th Annual Report
on the business and operations of your Company ("the Company" or
"KIOCL") and its Audited Financial Statements for the financial year ended March
31, 2023 (FY'23), together with the Auditors' Report and Comments on the
Accounts by the Comptroller and Auditor General (CAG) of India.
FINANCIAL RESULTS AND STATE OF COMPANY'S AFFAIRS
(H in crores, Except EPS & Book Value)
Particulars |
FY 2023 |
FY 2022 |
Total Revenue / Turnover |
1623.81 |
3080.74 |
Revenue from Operations |
1543.42 |
3006.45 |
Other Income |
80.39 |
74.29 |
Earnings Before Interest and Tax |
(109.12) |
423.24 |
Profit / (Loss) Before Tax |
(122.76) |
411.03 |
Tax Expense / Saving (including deferred
taxes) |
25.09 |
97.62 |
Profit / (Loss) After Tax |
(97.67) |
313.41 |
Add: Other Comprehensive Income (Net of Tax) |
4.08 |
3.47 |
Total Comprehensive Income |
(93.59) |
316.88 |
EPS (Basic & Diluted) |
(1.61) |
5.16 |
Average Net Worth |
2072.84 |
2064.81 |
Average Capital Employed |
2290.18 |
2270.62 |
Book Value per Share |
32.94 |
35.27 |
Return (EBDITA) on average Capital Employed
(%) |
(3.66) |
20.01 |
Return on Average Net Worth (%) |
(4.71) |
15.18 |
Capital expenditure |
422.83 |
290.45 |
Contribution to Exchequer: - |
|
|
Central: |
63.44 |
167.97 |
State: |
21.85 |
3.06 |
Impact of Export Duty @ 45%
Export duty @ 45% on Pellets was levied by Govt. of India vide Customs
Notice No. 29/2022 - Customs dated 21-05-2022. Accordingly, mainly due to unviable
operation in view of levy of export duty, the Company's Pellet Plant operation was
suspended for 187 days and was operated only for 178 days during the year.
However, Govt. of India vide notification No. 58/2022-Customs dated
18-11-2022 withdrew the export duty w.e.f. 19-11-2022.
Despite the aforesaid challenges posed, your Company's production
during the year was 1.510 Million Tonnes (Mt) and dispatch was 1.460 Million Tonnes
(against FY'22 production and dispatch of 2.030 Mt and 2.072 Mt respectively).
Impact of Russia-Ukraine War
The year under review was a tumultuous year for the steel industry.
Globally, the industry started well on the back of a strong post-Covid recovery and the
infrastructure investments that many governments across the world had announced to support
this recovery. However, the conflict in Ukraine made worse the inflationary pressures
being felt due to supply chain bottlenecks in the post Covid world. Gas prices shot up as
did coal prices which led to steel prices shooting up. Economic crisis induced by war
caused decreasing steel demand and redirection of trade flows. The war worsened current
economic situation globally.
Revenue
During the year, your Company earned a Revenue from Operations of
H1543.42 crores as compared to H 3006.45 crores in the previous year. Revenue from export
witnessed a downward trend by 46% to H 1361.43 crores as compared to the previous
Financial Year figure of H 2928.97 crores.
Your Company achieved total export sales of 1.273 million tonnes of
Pellets, against previous years export of 2.032 million tonnes. Your Company achieved 88%
of total revenue from operations through export. Income from Sale of Services (O&M
Operations and Mineral Exploration Services) during the year was H 20.47 crores against H
24.91 crores of previous year. Other Income comprising of Income from Treasury Operation
and other Miscellaneous Income has increased to H 80.39 crores from H 74.29 crores.
Profits / Loss
Due to imposition of duty @ 45% on export of Iron Ore Pellets vide
Customs Notification dated 21-05-2022, w.e.f. 22-05-2022, your Company was not in a
position to export Iron Ore Pellets post duty imposition regime and coupled with high
produce prices for domestic market, your Company incurred a Loss Before Tax of H 122.76
crores against a Profit Before Tax of H 411.03 crores in the previous year.
DIVIDEND AND APPROPRIATIONS
Your Company being a CPSE, pays dividend in compliance with DIPAM
guidelines issued from time to time by Ministry of Finance and Board approved Dividend
Distribution Policy in terms of the Regulation 43A of SEBI (LODR) Regulations, 2015 which
is available at weblink https://kioclltd.in/table. php?id=282&lang=EN.
However, the Board of Directors had not recommended payment of dividend
for the year 2022-23 due to absence of distributable profits. The Board has not
recommended dividend based on the parameters laid down in the Dividend Distribution
Policy. Further no amount is transferred to reserves of the Company.
DIVIDEND HISTORY OF LAST 7 YEARS
(Excluding DDT)
Years |
|
Rate (%) |
Per Share (Rs) |
Amount (Rs in crs) |
2016-17 |
Interim |
1.1 |
0.11 |
6.98 |
|
Final |
2.6 |
0.26 |
16.50 |
2017-18 |
Interim |
2.7 |
0.27 |
17.13 |
|
Final |
7.9 |
0.79 |
50.13 |
2018-19 |
Final |
13.3 |
1.33 |
82.72 |
2019-20 |
Final |
7.0 |
0.70 |
43.54 |
2020-21 |
Final |
16.4 |
1.64 |
99.67 |
2021-22 |
Interim |
9.8 |
0.98 |
59.56 |
|
Final |
7.9 |
0.79 |
48.01 |
Financial Saliency
As on 31-03-2023, the Company had a net cash and Bank Balance of Rs
773.29 crores as against Rs 1107.58 crores as on 31-03-2022. The reduction in cash is due
to capital expenditure.
Treasury Management / Investment of Surplus Funds
The long-term requirements to fund the CAPEX of Rs 422.83 crores was
met through internal resources during the year and Term Loan in the Debt Equity ratio of
2:1 for forward and backward integration of the existing Blast Furnace plant at Mangalore
from Canara Bank aggregating to Rs 21.83 Crores.
The short-term borrowing requirements were met through surplus funds
invested with Liquid Fund of Public Sector Mutual Fund and availment of Overdraft against
Fixed Deposits from different banks at competitive rate of interest to optimize its cost
of working capital.
Your Company has a Board approved policy for investment of surplus
funds since 06-04-2016. The policy is being reviewed and amended from time to time by the
Board in line with DPE Guidelines.
Subsidiaries, Joint Ventures and Associates
During the FY 2022-23, the Company has no Subsidiaries, Joint Ventures
and Associates.
Credit Rating
The Credit rating of the Company is covered in the Corporate Governance
Report of the Company.
Details of Deposits
The Company has not accepted any deposits during the year.
Short Term Loans
Short Term borrowings of Rs 380.82 crore (previous year Rs NIL crore)
were outstanding as on 31-03-2023.
Debt Equity Ratio
Debt equity ratio as on 31-03-2023 was 0.206:1 as compared to 0.004:1
of previous year due to increase in borrowings.
CAPEX
During the year under review the total CAPEX was Rs 422.83 crores,
which was 110% of the Budget Estimate (BE) of Rs 384.63 crores and against previous
years CAPEX of Rs 290.45 crores.
KIOCLs ranking at Stock Exchange A Top 500 Company
Your Company had been included amongst the top 500 listed Companies as
per Market Capitalization on NSE and BSE and stands at No. 319 and 323 with Market
Capitalisation of Rs 10,243.64 crores and H 10,246.68 crores, respectively, as on
31-03-2023.
MoU Performance
MoU - 2021-22 - Performance of your Company in terms of the
Memorandum of Understanding (MoU) with the Ministry of Steel, Government of India for the
Financial Year 2021-22 was rated as "Good". MoU - 2022-23 - Due to
imposition of duty @ 45% on export of Iron Ore Pellets vide Customs Notification dated
21-05-2022, w.e.f. 22-05-2022, the Company was not in a position to export Iron Ore
Pellets post duty imposition regime during the FY 2022-23. Accordingly, at the
Inter-Ministerial Committee (IMC) Meeting held on 19-10-2022 for finalization of MoU
2022-23, Ministry of Steel informed IMC that the Company was primarily engaged in export
of iron pellets which amounts to around 80% of Company's revenue. However, due to
increase in export duty, the export revenue stream was no more viable, and Company's
domestic operations was also not very promising on account of high produce prices.
Therefore, the Company was proposed to be exempted from MoU signing. IMC agreed to this
view point and based on the request of Company and subsequent confirmation from
administrative Ministry, the Company was exempted from signing MoU for the Financial Year
2022-23.
Risk Management
Pursuant to the requirement of Regulation 21 of the Listing
Regulations, the Company had constituted a Board level Risk Management Committee w.e.f.
26-03-2019 and has a robust Risk Management Policy framework to identify, evaluate and
prevent / reduce impacts of the risks on Company's Business. Risk preventive work
culture with strength to mitigate / reduce the risks impacts are developed within the
organisation to enhance Company's performance. The details of Committee and its terms
of reference are set out in the Corporate Governance Report. In line with Risk Management
Policy, your Company have an established procedure to proactively identify, analyse and
mitigate risks.
Implementation of Risk Management Policy
The Company has been continuously assessing its risks to ensure
sustained business operations aligned with its long-term objectives. The following are the
roles and responsibilities for effective implementation of Risk Management System across
the organization: -
Roles |
Responsibilities |
Chief Risk |
Oversees the establishment of Risk Management
System. Informs Risk Management Committee and Board for its implementation and its
compliance. Ensures providing required resources for mitigating Risk. |
Officer |
|
Steering |
Ensures successful implementation of Risk
Management System. Reviews once in three months for continuous improvement and guides the
Risk Management Team. |
Committee |
|
|
Chairman of Steering Committee maintains
Company's Risk Register. Based on recommendation by Steering |
|
Committee, update the Company's Risk
Register once in three months. |
Roles |
Responsibilities |
Risk Officer |
Conducts Risk Awareness
Programme, co-ordinate with Steering Committee and HoDs for implementation of Risk
Management Policy across the Organization. |
Risk Owner |
Each HoD is the Risk Owner and
conducts brain storming session, identifies risks, risk evaluation and indexing, short
lists for mitigation, nominates risk champion for each risk, gets the mandate from
Functional |
|
Director/CMD for the required
resources, mitigates, adds or deletes and maintain risk register for the Department with
the approval of Unit In-charge or Functional Director as the case may be. Sends a copy of
Department Risk Register to Chairman Steering Committee with the status of implementation
once in three months. |
Risk Champion |
Assists concerned HoD in
implementation of RMP, responsible for mitigating the identified risk/risks, monitor and
review for continuous improvement. |
The Company has identified following major risks: -
MARKETING & SALES RISK
Discerption of Risk |
Risk Contributing Factors |
Risk Treatment Plan |
Volatility in Iron Ore & |
- Longer lead time of iron ore sourced from
market. |
Reduction of cost of production and entering |
Pellet market |
- High volatility in demand and price of
Pellets. |
into back-to-back contracts. |
|
- Market forces led
uncertainty in sales volumes and revenue. |
|
|
- Inventory holding at times of lower sales. |
|
|
- Sale of Pellets in spot market. |
|
|
- High Internal lead time for conversion of
Iron Ore |
|
|
Fines into Pellets. |
|
Govt Policies and Guidelines |
Implementation of new policies
and changes in taxation policies by Govt. |
Taking up the matter with
concerned Govt authorities. |
Reputation Risk Brand
Image |
Any dent to the brand image /
reputation of KIOCL product will severely affect the demand in the market which in turn
affects the overall business activity. |
- Adhering to contractual
specification, terms and conditions for supply. |
|
|
- Production of pellets with
quality as per end user requirements. |
|
|
- Addressing quality concerns
and taking corrective actions. |
Changes in |
Likely to receive demand notice from Customs
/ GST |
An Indirect Tax Experts (GST & Customs |
Customs Act, Rules, Customs
Duty and GST tariff rates |
|
Duty) appointed to guide /
advice Company regarding any changes / impacts in the regulations and provide suggestions
to take necessary preventive / remedial actions. |
OPERATIONAL RISK
Discerption of Risk |
Risk Contributing Factors |
Risk Treatment Plan |
Delay in |
- Delay in Permission to enter Forest Area. |
- Resolution of pending issues with Forest
Dept. |
Development and Commencement
of |
- Delay in appointment of
raising contractor. |
- Appointment of consultant
for Transaction Advisory Services |
Mining Operations of Devadari
Iron ore mine |
- Unfavourable decision in the
WP No. 13311/2021 (PIL). |
- Defending the WP
No.13311/2021.(PIL) |
Failure of Steel |
- Ageing of structures |
- Periodical inspection of structures and
evaluating the stability and safety and taking corrective actions. |
Structures |
- Adverse coastal weather
conditions |
|
|
|
- Structural strengthening / replacement /
painting. |
Fire at Furnace oil |
- Nature / property of the material |
- Dedicated CISF Fire wing inside the plant. |
storage area |
- Leakage of furnace oil |
- Regular inspection and taking necessary
corrective action. |
|
- Grass growth surrounding the Furnace |
|
|
Oil tank. |
|
Procurement of Iron |
Long Term Agreement validity. |
- Long Term Agreement with M/s NMDC, |
Ore |
|
- Participation in e-auctions,
Tolling (Supply and buy back), diversification of sourcing. |
Adverse weather conditions and
environmental accidents at Lakya Dam, Kudremukh |
Weather vagaries, landslides
etc. |
- Regular monitoring and
maintenance work along with EAP. |
|
|
- Providing necessary
resources to maintenance and monsoon preparatory works. |
FINANCIAL RISK
Discerption of Risk |
Risk Contributing Factors |
Risk Treatment Plan |
Contingent Liability |
Adverse decision of CESTAT for demand of
Special Additional Duty on DTA clearance of Pellets during Oct'10 to Apr'12
amount to H 58,48,31,145/- & applicable interest towards the demand raised alongwith
penalty) |
- Case is sub-judice before CESTAT. |
|
|
- Consultant/s appointed by
Company will represent before CESTAT. |
PEOPLE RISK
Discerption of Risk |
Risk Contributing Factors |
Risk Treatment Plan |
Succession Plan |
Shortage of Manpower can
cause a volatile work environment leaving other employees and their subordinates feeling
unmotivated to do their jobs. |
Complete Manpower study by
September 2023. |
Directors and Officers insurance
The Company has undertaken Directors and Officers Liability insurance
(D and O insurance') Policy for all its Directors, including Independent
Directors and Officers.
Particulars of Loans, Guarantees or Investments
There was no loan, guarantee or investment made under Section 186 of
the Companies Act, 2013.
Related Party Transactions (RPTs)
During the period under review, no transactions were entered with
Related Parties as defined under the Section 188 of Companies Act, 2013 read with
Regulation 34(3) and Para A of Schedule V of the SEBI Regulations, 2015, as such annexure
AOC-2 is not furnished.
Further, details of related party transactions entered by the Company,
in terms of Ind AS-24 have been disclosed in the notes no. 28.2.4 to the financial
statements forming part of Annual Accounts 2022-23. The same were also disclosed to Stock
Exchanges on half yearly basis as required under Regulation 23(9) of SEBI (LODR),
Regulations, 2015.
The Board approved Policy on Materiality of Related Party Transactions
and dealing with Related Party Transactions is available on the Company's Website at
https://kioclltd.in/ table.php?id=280&lang=EN.
Material Changes and Commitments, if any, affecting Financial Position
There was no material change / commitment occurred affecting the
financial position of the Company after the financial year ended 31-03-2023 till the date
of this report and there was no change in business.
Management Discussion and Analysis Report
The Management's discussion and analysis report is set out in this
Annual Report in terms of the provisions of Regulation 34(2)(e) of the SEBI (LODR)
Regulations, 2015.
Business Responsibility & Sustainability Report
In accordance with Regulation 34(2)(f) of the SEBI Listing Regulations,
the Securities and Exchange Board of India (SEBI'), in May 2021, introduced new
sustainability related reporting requirements to be reported in the specific format of
Business Responsibility and Sustainability Report (BRSR'). BRSR is a notable
departure from the existing Business Responsibility Report and a significant step towards
giving platform to the companies to report the initiatives taken by them in areas of
Environment, Social and Governance. Further, SEBI has mandated top 1,000 listed companies,
based on market capitalisation, to transition to BRSR from FY2022-23 onwards. Accordingly,
we are glad to present our inaugural
BRSR for FY2022-23, which forms part of this year director's
report.
BUSINESS AND OPERATIONAL REVIEW
Pellet Plant Unit
Your Company produced 1.510 million tons of Pellets during the year
2022-23 as compared to 2.030 million tons in the previous year and sold 1.460 million tons
of Pellets as against 2.072 million tons in the previous year. Out of the total quantity
sold, exported quantity was 1.273 million tons which was about 87.19 % of the total sales.
Blast Furnace Unit
The Blast Furnace Unit (BFU) remained under suspension due to
uneconomic price of Pig Iron and high Coke Price since August 2009. Your Company is in the
process of implementing the backward integration of BFU (Coke Oven) to make its operations
economically viable.
A snapshot of production target vis-a-vis actual achievement with
capacity utilization and sales performance during last five years including current year
are depicted at Table 1 & 2.
Table 1: Capacity Utilisation
(Qty. In Million Tons)
Year |
MOU Target |
Actual Production |
capacity utilisation (%) |
2022-23 |
NIL* |
1.510 |
43 |
2021-22 |
2.800 |
2.030 |
58 |
2020-21 |
2.500 |
2.210 |
63 |
2019-20 |
2.300 |
2.375 |
68 |
2018-19 |
2.170 |
2.238 |
64 |
(Installed capacity of Pellet Plant is 3.500 million tons / annum). *
The Company was exempted from signing MoU.
Table 2: Sales Performance
(Qty: in Million Tons, Value: H In crores.)
|
Pellets |
Pig Iron |
Total |
Year |
Qty |
Value |
Qty |
Value |
Qty |
Value |
2022-23 |
1.460 |
1518.02 |
0.004 |
4.71 |
1.464 |
1522.73 |
2021-22 |
2.072 |
2980.15 |
0.001 |
1.15 |
2.073 |
2981.30 |
2020-21 |
2.311 |
2343.80 |
0.003 |
3.55 |
2.314 |
2347.35 |
2019-20 |
2.356 |
1878.97 |
0.003 |
5.20 |
2.359 |
1884.17 |
2018-19 |
2.206 |
1,825.97 |
0.002 |
2.80 |
2.208 |
1,828.77 |
Mineral Exploration Works
A total of nineteen (19) number of Mineral Exploration Projects for
NMET, Govt. of Karnataka and M/s JSW Steel Limited with cumulative approved project value
of H 134.95crores (including GST) were handled during the year.
Additionally, Mineral Exploration works of Devadari Iron Ore Block
(captive mine block) with approved project value of H 24.86 Crores (including GST)
was also handled.
Your Company: -
- entered into regime of providing mineral exploration services to
private agencies by securing five (5) number of Iron Ore Mine Lease (for assessment of BHQ
/ silicious ore) Projects from M/s JSW Steel Limited, Tornagallu, Bellary, Karnataka with
order value of H 12.27 crores (Including GST).
- carried out G4 level of Mineral Exploration as per the technical
directions of National Mineral Exploration Trust (NMET), Ministry of Mines, Govt of India
for: -
basemetal minerals in Anaji Basemetal Block, Obalapura Basemetal
Block, Chitradurga (Dist.), Karnataka and
kyanite mineral in Kallahalli Kyanite Block, Mysore (Dist.),
Karnataka.
- diversified in to the arena of handling basemetal ME Projects through
executing copper exploration works at Anaji and Obalapura basemetal blocks in the state of
Karnataka.
- Completed G3 level of ME works in HR Gaviyappa Amalgamated Iron Ore
Block (Block ID: KIOCL_10_KA) under GoK Funding with submission of Geological Report to
DMG, GoK and the Block is under auction by Department of Mines and Geology, Govt of
Karnataka.
- Generated a revenue of H 6.40 crores (Including GST) during FY
2022-23 and cumulative revenue of H 23.25 Crores (Including GST) from past 5 years.
- Placed a request to Director General, Geological Survey of India for
entering into MoU for carrying out NGPM works (National Geo Physical Mapping Programme -
baseline data generation programme) in 22 nos of toposheets over an extent of 15,735 sqkm
in the state of Tamilnadu.
- Continual efforts are in place for securing 15 potential blocks in
the state of Karnataka for bulk and base metals for future ME works through GoK and NMET
funding.
Operation and Maintenance - M/s. OMC at South Kaliapani, Odisha: -
KIOCL has taken up the project of completing the balance works of COBP
2, OMC at South Kaliapani through a mutual contract agreement. The work involves erection,
commissioning and handover the chrome ore beneficiation plant of M/s OMC. The work of
commissioning of balance of equipment of new COBP plant of M/s OMC has been completed on
27-06-2022. The no load test was carried out during July-October 2022 since tailing pond
of OMC was not available. The load test of the plant was conducted during 10-11-2022 to
10-12-2022 as per contract. The plant modification jobs were done from 11-12-2022 to
31-01-2023 to stabilise the plant operation and finally the plant was declared as
commissioned on 10-02-2023. M/s OMC has issued commissioning certificate on 16-03-2023.
TheplantishandedovertoM/sOMCforrunning.YourCompany has earned a net revenue of H 56 crores
towards works and supply of equipment.
EXPANSION OF MARKET BASE
China, being the consumer of more than 50% of the iron ore produced in
the world has been the major market for KIOCL Pellets. In continuation with its efforts to
sell pellets in the non-Chinese Market to minimize dependency on the Chinese market and to
expand its Market presence, about 54.38% of the total exports made were to markets other
than China in comparison with about 57.93% during the previous year. Efforts Continued for
market share diversification by reaching end-users in Oman, Indonesia, Italy, Turkey, and
Netherlands. China controls about 70-80% of sea borne iron ore trade and hence finding
market alternative to China for KIOCL pellets is in line with Company's expansion of
business plan.
[Source: PMAI, Steel Mint, MoS, IBEF, World Steel, Media Report, PIB,
Union Budget, WSA etc.]
CAPEX AND GROWTH PLAN
For long term sustainability / viability of your Company in the
competitive market environment and forward consistent steady growth, your Board made the
following efforts:
DEVELOPMENT & COMMENCEMENT OF DEVADARI IRON ORE MINE
Govt. of Karnataka vide notification dated 23-01-2017 reserved an area
of 470.40 ha in Devadari Range, Sandur Taluk, Bellary District for Iron Ore and Manganese
in favour of KIOCL Ltd., under the provisions of Section 17A (2) of MMDR Act, 1957.
Director, Mine & Geology, GoK vide letter dated 13-02-2017 directed KIOCL to obtain
statutory clearance viz Mining plan approval from IBM, Environment clearance from
MoEF&CC, Forest clearance from MoEF&CC, GoI, CFE from KSPCB to take further
necessary action for execution of mining lease deed.
Final approval / Stage II approval
Ministry of Environment, Forest and Climate Change (Forest Conservation
Division), Government of India vide its Letter dated December 16, 2022 intimated that the
Central Government has accorded Final approval / Stage II approval under the Forest
(Conservation) Act, 1980 for the diversion of 401.5761 hectare (388.00 ha for mining +
13.5761 ha. for approach road=401.5761 ha.) of forest land in Swamimalai Block Forest,
Sandur Taluk, Ballari District, Karnataka state for Iron Ore and Manganese Ore Mining in
Devadari Hill Range in favour of M/s KIOCL Ltd, subject to the conditions mentioned in
said letter.
Execution of deed for grant of a Mining lease between GoK & KIOCL
Govt. of Karnataka executed the Mining Lease deed on January 2, 2023
with KIOCL Ltd. for grant of a mining lease for Iron Ore and Manganese Ore, over an extent
of 388 ha for a period of 50 years in Devadari Range, Sandur Taluk, Ballari District,
Karnataka State.
Registration of Mining Lease Deed document
The Mining Lease deed document executed between Govt. of Karnataka and
KIOCL has been registered at the Office of Sub-Registrar, Sandur taluk on 18-01-2023 by
paying total amount of H 329.17 crores which includes the stamp duty, cess on stamps and
fees for registering documents.
Issue of Govt. Order for handing over of forest land
Government of Karnataka issued Govt order for final diversion of Forest
land 401.57610 ha on 11-04-2023, on handing over of forest land by DCF Ballary to KIOCL,
Company will start the activities for commencement & development work at Devadari Iron
Ore Mine.
Shri Nagendranath Sinha, IAS, Secretary, Ministry of Steel, Govt. of
India visited Devadari iron Ore Mine site on February 25 & 26, 2023 and reviewed the
status of commencement and Development work and also chaired the meeting with NMDC, KIOCL
& MECON official for the same.
Appointment of Agencies for preparation of R&R Plan
Your Board has appointed Federation of Indian Mining Industries (FIMI)
for collection of data / information from KIOCL, review of data / information and
compilation of data for preparation of Rehabilitation & Reclamation Plan by Indian
Council of Forestry Research and Education (ICFRE) for Devadari Iron Ore Mine. The Board
has also appointed Indian Council of Forestry Research and Education (ICFRE) for
preparation of Rehabilitation & Reclamation (R&R) Plan for Devadari Iron Ore Mine.
SETTING UP OF COKE OVEN AND DISP PROJECTS OF BFU
Your Company has planned to re-activate the existing Blast Furnace of
350 Cu.M capacity by suitable upgradation with forward integration project of 2.0 lakh TPA
DISP and
1.8 Lakh TPA, Coke Oven Plant with waste recovery Power Plant under
backward integration projects of existing Blast Furnace Unit. KIOCL's Board and
Public Investment Board (PIB) had approved the project with total capital outlay of
H836.90 crores. MoEF&CC has granted environmental clearance (EC) and KSPCB has
accorded consent for expansion in June 2021 valid up to June 2026.
M/s MECON has been appointed as EPCM consultant for the project. Main
technological packages envisaged are NRHR type Coke Oven Plant, Waste heat recovery Power
Plant, Ductile Iron Spun Pipe, Pulverised Coal Injection Plant (PCI), Oxygen and Nitrogen
Plants. Captive coke oven and PCI System will reduce the input raw material cost of Blast
furnace operation. The Coke Oven Plant agreement was signed with M/s Tuaman Engg. Ltd,
Kolkata on 22-11-2021 and Tripartite agreement was entered among KIOCL, M/s Tuaman Engg.
Ltd and M/s. CIMFR, Dhanbad, Technology provider under Atmanirbhar Bharath Initiative. The
total project cost for Coke Oven is H218.00 crores. The tenders floated for DISP Plant,
Power Plant, Pulverized Coal Injection (PCI), Oxygen and Nitrogen plants have been
cancelled due to high price and change in procurement policy of GoI. Further process of
re-tendering is being reviewed by Company as per the guidelines of Ministry of Steel.
INSTALLATION OF VERTICAL PRESSURE FILTERS
The existing vacuum disc filters at Pellet Plant are not able to handle
Iron ore having high Alumina content and slimy in nature. KIOCL Board approved the project
in its 257th Meeting held on 26-03-2019 with the estimated cost of H 158.60
crores. Four (04) vertical Pressure filters have been installed at Pellet Plant supplied
by M/s METSO to have flexibility to utilize the ore received from any part of the country.
Auxiliary equipments are also being supplied by various vendors and commissioning of
Vertical Pressure filters is expected during the year 2023. Company has appointed M/s
MECON as consultant for installation of vertical pressure filters. The total savings in
production cost by installation of vertical pressure filters is expected to be H
45.3 crores per annum and it would also improve the capacity utilization with flexibility
in using iron ores of different types.
INSTALLATION OF DUAL BURNER SYSTEM
Your Board in its 277th Meeting held on 04-02-2022 as a part
of green initiative, has taken up the project of installing dual burner system in the
indurating machine of Pellet Plant to utilise Natural Gas as an alternative to the Furnace
Oil being used currently. The project cost is H 36.80 Crores. The installation of
non-recovery coke plant of capacity 1.8 LTPA with indigenous technology provider Central
Institute of Mining and Fuel Research (CIMFR), Dhanbad is taken up under Atma Nirbhar
Bharath initiative.
INFORMATION TECHNOLOGY FOR DIGITAL TRANSFORMATION
Single Integrated Information System / ERP
SAP S/4 Hana ERP on cloud platform has gone live on April 1, 2023 with
core modules. The project is named as "Ashwa Megha". The ERP implementation is a
major milestone towards digital transformation of the Company.
Upgradation of Networking System
The network is upgraded with managed L2 and L3 core managed switches
with OFC and copper cables with managed network architecture with NMS server having Active
Directory (AD) and Authentication, Authorisation and Accounting (AAA) software for central
management admin console to monitor the data traffic.
Data and Cyber Security
The Company relies on state-of-the-art technologies to ensure that the
confidentiality, integrity and availability of all its online services and its data are
adequately secured from the prevailing cyber security threats. The Company safeguards its
data with advanced security systems and successfully defends the system against malicious
virus or other cyber threats. The networks of the Company are secured by using Fortinet
Next Generation Firewall and Bit Defender End Point Security for protection of end point
devices. IT audit and VAPT was carried out during the year.
HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL RELATIONS
Human Capital
Total number of employees on the rolls of the Company as on 31-03-2023
was 654 consisting of 195 Executives, 41 Supervisors and 418 Non executives.
Table: 3 Breakup of employees on rolls as on March 31, 2023
Group |
Total Employees |
SC |
ST |
PWD |
Women Employees |
A |
195 |
35 |
16 |
4 |
14 |
B |
41 |
6 |
2 |
3 |
7 |
C |
395 |
57 |
26 |
1 |
2 |
D&D(S) |
23 |
2 |
3 |
3 |
1 |
Total |
654 |
100 |
47 |
11 |
24 |
Employee Welfare
The Company continues to extend welfare benefits to the employees and
their dependents by way of comprehensive Medical Facilities for self & dependents,
retired employees, Housing Facilities, Canteen Facilities, Sports Facilities, First Aid
Centre, Ambulance, Recreation centre etc.
Persons with Disabilities Act, 1995
Your Company ensures compliance under Persons with Disabilities act,
1995. Suitable provisions / modifications are made in the work place to meet the
requirements of persons with disability.
Prevention of Sexual Harassment of Women at Workplace
KIOCL has a zero tolerance towards sexual harassment at the workplace.
In line with the provisions of Sexual Harassment of Women at Workplace (Prevention,
Prohibition & Redressal) Act, 2013 (POSH Act), an Internal Complaints
Committee' has been constituted in the Company for redressal of complaint(s) against
sexual harassment of women employees. No complaint was filed during the year under the
Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act,
2013.
Women in the Workforce and their Empowerment
KIOCL is a Corporate Life Member of the Forum of Women in Public Sector
(WIPS) a body functioning under aegis of Standing Conference of Public Enterprises
(SCOPE). Women employees are life members of the Forum. Conducting several constructive
programmes for the betterment of Women. Several training sessions on empowerment of Women
have been conducted for enlightening women and for the contract workers.
Industrial Relations and Employees Welfare
Your Company continued to maintain harmonious industrial relations,
co-operation between the elected representative bodies of employees and management.
Recruitment & Superannuation
During the year: -
a) Company recruited seven recruited seven (7) Executive Trainees,
Eight (8) Graduate Engineer Trainees in group A';
b) Company recruited three (3) employees at lateral entry;
c) Fifty-Two (52) employees superannuated on attaining the age of
superannuation.
d) No employee was released under VRS scheme.
Human Resource Development
Various Training programs including in-house training programs,
nominations for external seminars, conferences, participation in training programs
organized by DPE etc., were carried out to enhance the skillset of employees.
Revision of Perquisites
Ministry of Steel vide its letter dated 10-04-2023 conveyed the
presidential directive to your Company to implement revision of perquisites of Board level
and below Board level Executives and Non-Unionised Supervisors from existing rate of 20%
to 35% w.e.f. the date of issue of presidential directives strictly as per DPE OM dated
03-08-2017 subject to conditions as mentioned in said letter. In pursuance to Presidential
directive perquisites of Board level and below Board level Executives and Non-Unionised
Supervisors were revised from 20% to 35% w.e.f. 10-04-2023.
Remuneration Policy
The Policy of Remuneration to Directors, KMP & other Employees in
pursuance to Schedule II Part D (1) of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 is
available on Company website at weblink https://www.
kioclltd.in/table.php?id=282&lang=EN. Your Company is a Government Company within the
meaning of Section 2 (45) of the Companies Act, 2013 and being a Central Public Sector
Enterprise under Ministry of Steel, the remuneration and other benefits of the employees
of the Company are fixed / decided by the Department of Public Enterprises (DPE), Govt. of
India.
Remuneration of Whole Time Directors
The salary and/or allowances of the Whole Time Directors are decided by
the President of India.
Remuneration of Independent Directors
Independent Directors are appointed by the President of India. The
remuneration to Independent Directors is paid by way of sitting fee for attending Board of
Directors meeting and Committees meetings thereof. The sitting fee is being paid to
Independent Directors within the ceiling limit prescribed under Section 197 (5) read with
Rule 4 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014.
Remuneration of Government Directors
No remuneration either by way of salary / allowances or sitting fee is
paid to a Government Director representing Ministry of Steel.
Remuneration of KMPs other than Directors
The Salary / allowances of KMPs other than Directors are paid as per
the scale of pay determined based on DPE Guidelines.
Man-days Trainings
During the year 6085 of Man-days training was imparted to the
employees. Further, the Company in its commitment to good corporate governance, also
imparts skill development training to contract workers, apprentices, students from
managerial and technical institutes as well as for local population.
INTELLECTUAL CAPITAL
Class 16 of the Trade Marks Act, 1999
In pursuance to the Trade Marks Act, 1999, registration certificates
under two applications filed under class 16 were registered during the year 2018 and were
valid for a period of ten years from the date of application i.e., upto 06-05-2023.
Accordingly, your Company has re-submitted two applications during the year under Class 16
to the Trade Marks Registry. Registrar for Trade Marks has renewed Registration for Trade
Mark No. 2526716 and 2526717 in class 16 for a period of ten years from 07-05-2023.
Class 6 and 35 of the Trade Marks Act, 1999
For two applications each filed during the year 2013 under Class 35
(Device Mark - Advertising, Business Management, Business Administration, Office
Functions) and Class 6 (Device Mark - Iron Oxide Pellet, Pig Iron Ore Concentrate) of the
Act, opposition proceedings are pending.
Particulars of Employees
Ministry of Corporate Affairs vide its notification dated June 5, 2015
exempted Government Company with the applicability of Section 197 of the Companies Act,
2013. However, the remuneration received by the employees of the Company, had not exceeded
the limit prescribed under Section 197 read with Rule 5 of The Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
Public/Staff Grievance Redressal
Your Company has framed a well-defined grievance procedure, evolved
under the Code of Discipline'. Staff Grievances received are redressed to the
satisfaction of the aggrieved. With respect to public grievance, as and when any
complaints are received, necessary remedial action is taken promptly. Complaints/
grievances other than the staff grievance are categorized into customer / consumer
complaints / grievances from the Contractors, NGOs / General Public etc. The respective
project heads are empowered to dispose of the grievances concerning their areas.
CORPORATE GOVERNANCE
Pursuant to Regulation 34(3) and Para-C of SEBI (LODR) Regulations,
2015, a separate section on Corporate Governance along with certificate from Practising
Company Secretary confirming the level of compliance is attached and forms a part of the
Board's Report.
Directors and Other Key Managerial Personnel
As on financial year ended March 31, 2023, the Board consists of six
members, two of whom were executive or whole-time Directors, two non-executive Director,
representing Ministry of Steel and two Independent Directors. Details of sitting fees /
remuneration paid to Directors and to KMP's respectively are provided at table no. 15
in Corporate Governance Report.
Declaration by Independent Directors
The Company received necessary declaration from Independent Directors
under Section 149(7) of the Companies Act, 2013, that they meet the criteria of
independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of
the Listing Regulations. The Board of Directors at its 285th Meeting held on
05-04-2023, noted the declarations. Independent Directors of the Company have registered
themselves with Independent Directors databank in compliance with Companies (Creation and
Maintenance of database of Independent Directors) Rules, 2019 and Companies (Appointment
and Qualification of Directors) Fifth Amendment Rules, 2019.
Women Directors
As on Financial Year ended March 31, 2023, the Company had two women
Directors, Smt. Sukriti Likhi, Non-Executive Govt. Nominee Director representing Ministry
of Steel and Dr. Usha Narayan, Independent Director.
Changes in the Composition of the Board
Inductions / Cessations
In terms of Article 91 of the Articles of Association of the Company,
the President of India is vested with the power to appoint the Directors of the Company
from time to time and shall determine the term of office of such Directors. Accordingly,
the following appointments/cessations on the Board of your Company were affected as per
the directives of the President of India: -
Shri Devidatta Satapathy, Dy. Secretary, Ministry of Steel was
appointed as an Additional Director and designated as Govt. Nominee Director on the Board
of the Company with effect from 30-04-2022. Having so appointed, Shri Devidatta Satapathy
was regularized with the approval of shareholders by way of postal ballot on 23-07-2022 by
virtue of Section 110 of the Companies Act, 2013 read with Regulation 17 of SEBI (LODR)
Regulations, 2015.
Shri Binay Krushna Mahapatra was appointed as Director
(Commercial) w.e.f. 30-08-2022.
Shri Nirmalendu Mohapatra ceased to be the Independent Director
on the Board of the Company w.e.f. 20-10-2022 on completion of his tenure.
Shri G. Ramasamy ceased to be the Independent Director on the
Board of the Company w.e.f. 21-11-2022 on completion of his tenure.
Shri S. K. Gorai ceased to be the Director (Finance) of the
Company w.e.f. close of business hours of 31-01-2023, consequent upon attaining the age of
superannuation.
Shri K. V. Bhaskara Reddy ceased to be the Director (Production
& Projects) of the Company w.e.f. close of business hours of 31-01-2023, consequent
upon attaining the age of superannuation.
Ministry of Steel vide its order dated 03-05-2023 appointed Dr.
Sanjay Roy, Joint Secretary, Ministry of Steel as Govt. Nominee Director on the Board of
Company vice Shri Devidatta Satapathy, Director, Ministry of Steel.
Shri Ganti Venkat Kiran assumed the charge of Director
(Production & Projects) w.e.f. 09-05-2023 pursuant to MoS order dated 08-05-2023.
Shri Manoj Kumar Jhawar assumed the charge of Director (Finance)
w.e.f. 26-05-2023 pursuant to MoS order dated 24-05-2023.
Additional Charge assigned to Directors
Shri T. Saminathan, Chairman-cum-Managing Director was holding
the post of Additional Charge of Director (Commercial) upto 30-08-2023. Further, he was
holding the post of Additional Charge - Director (Production & Projects), from
01-02-2023 to 09-05-2023.
Shri Binay Krushna Mahapatra, was holding the Additional Charge
for the post of Director (Finance), from 01-02-2023 to 26-05-2023.
Appointments / Resignations of KMP
During the year under review, there was no appointment / resignation of
KMP. However, Shri S.K. Gorai, ceased to be Director (Finance) and Chief Financial Officer
of the Company w.e.f. close of business hours of 31-01-2023, consequent upon attaining the
age of superannuation.
Ministry of Steel vide its order dated 24-05-2023 appointed Shri Manoj
Kumar Jhawar as Director (Finance) of the Company and he took the charge of the post
w.e.f. 26-05-2023. Further Board appointed Shri Manoj Kumar Jhawar as Chief Financial
Officer of the Company w.e.f. 30-05-2023.
Key Managerial Personnel
In terms of Section 203 of the Act, the Key Managerial Personnel of the
Company are Shri T. Saminathan, Chairman-cum-Managing Director & Chief Executive
Officer, Shri Manoj Kumar Jhawar, Director (Finance) & Chief Financial Officer and
Shri P.K. Mishra, Company Secretary & Compliance Officer.
Directors Retiring by Rotation
In terms of Section 152 (6) of the Companies Act, 2013, Shri T.
Saminathan, (DIN: 08291153) Chairman-cum-Managing Director and Shri Binay Krushna
Mahapatra, (DIN: 09613777), Director (Commercial) being longest in office shall retire by
rotation at the ensuing AGM and being eligible for reappointment, offers themselves for
re-appointment. The Board recommends their re-appointment.
Number of Meetings of the Board
The Board met seven (7) times during the year under review, the details
of which are given in the Corporate Governance Report. The maximum interval between any
two Meetings did not exceed 120 days. The Meetings were conducted in compliance with
relevant regulations of Listing Regulations and Secretarial Standard -1 issued by The
Institute of Company Secretaries of India (ICSI).
Directors Responsibility Statement
Pursuant to Section 134 of the Act (including any statutory
modification(s) and/or re-enactment(s) thereof for the time being in force), the Directors
of the Company state that:
a) In the preparation of the Annual Accounts for the Financial Year
ended March 31, 2023, the applicable Accounting Standards had been followed along with
proper explanation relating to material departure.
b) The Company has selected such Accounting Policies and applied them
consistently and made judgments & estimates that are 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 & Loss of the Company for that period.
c) The Company has taken proper and sufficient care towards 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 fraud and other irregularities.
d) The Company have prepared the Annual Accounts on a going concern
basis.
e) The Company has laid down Internal Financial Controls, which are
adequate and are operating effectively.
f) The Company has devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively.
The aforesaid statement has also been reviewed and confirmed by the
Audit Committee and the Board of Directors of the Company.
Annual Return
The Annual Return of the Company as on March 31, 2023 in Form MGT-7 in
accordance with Section 92(3) read with Section 134(3)(a) of the Act and the Companies
(Management and Administration) Rules, 2014, is available on the website of the Company at
weblink https://www.kioclltd.in/data. php?id=191&lang=EN.
MCA-21 e-filings
During the year under review, the Company filed all the statutory forms
and returns electronically as per the manner and conditions for filing prescribed under
Companies (Registration Offices and Fees) Rules, 2014. The financial statements for the
year under review were filed in accordance with the requirements of Section 134 read with
Companies (Filing of Documents and Forms in Extensible Business Reporting Language) Rules,
2015.
Compliance with Secretarial Standards
The Company complies with the applicable Secretarial Standards issued
by the Institute of Company Secretaries of India (ICSI).
Other disclosure
The details of application
made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the
year alongwith their status as at the end of the financial year. |
There was no application made
or proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016
(31 of 2016) during the year under review. |
The details of difference
between amount of the valuation done at the time of one-time settlement and the valuation
done while taking loan from the Banks or Financial Institutions along with the reasons
thereof. |
Not Applicable |
Statutory Auditor
The C&AG of India vide its letter dated 30-08-2022 had appointed
M/s YCRJ & Associates, Chartered Accountants as the Statutory Auditor of the Company
under Section 139 of the Companies Act, 2013 for the financial year 2022-23. The Auditors
have confirmed that they are not disqualified from being appointed as Auditors of the
Company. The Auditors remuneration for the year was fixed at H8.50 Lakhs plus applicable
taxes for Statutory Audit. The total amount paid to the Statutory Auditors for all
services rendered to the Company during 2022-23 was H12.15 Lakhs.
The Statutory Auditors have issued an unmodified opinion on the
financial statements for the financial year 2022-23 and the Auditor's Report forms
part of Annual Report.
Cost Records and Cost Audit
The Company is maintaining the cost records and requirement of cost
audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013. The
Cost Audit Report for the Financial Year 2021-22 was filed with the Ministry of Corporate
Affairs on 07-10-2022. The Cost Audit Report for Financial Year 2022-23 is under
finalisation and will be submitted to the Ministry of Corporate Affairs within the
prescribed timeline.
Cost Auditor
The Company maintains cost records as required under the provisions of
the Companies Act. The Company had appointed Cost Auditors for conducting the audit of the
cost records maintained for its Pellet Plant Unit during the Financial Year 2022-23. A
remuneration of H 50,000/- was fixed by the Board for payment to the cost auditors for
Financial Year 2022-23, which was ratified by the shareholders in the last AGM. The cost
audit reports are filed with the Central Government in the prescribed form within the
stipulated time. For the Financial Year 2023-24, the Board on the recommendations of the
Audit Committee, had re-appointed M/s R. M. Bansal & Co., Cost Accountants to audit
the cost records. The remuneration payable to the Auditor being placed before the members
in this Annual General Meeting (AGM) for their ratification vide Resolution at Item No. 8
of the Notice convening the AGM.
The Cost Audit Report for the financial year 2022-23 does not contain
any qualification, reservation or adverse remark.
Secretarial Auditor
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Company appointed M/s P.S. Bathla & Company Secretaries, Practicing Company Secretary
for conducting the Secretarial Audit for the Financial Year 2022-23. The Secretarial Audit
Report for the Financial Year 2022-23 forms part of the Directors Report.
The Secretarial Audit Report and Secretarial Compliance Report for the
financial year 2022-23 forms part of this report.
Internal Auditor
Pursuant to provisions of Section 138 of the Companies Act, 2013 read
with rule 13 of Companies (Accounts) Rule 2014 and based on the recommendation of the
Audit Committee, the Board of your Company had appointed M/s Manohar Chowdhry &
Associates, Chartered Accountants, Bangalore as the Internal Auditor of the Company for
conducting Internal Audit for the Financial Year 2022-23 at audit fees of H13,80,000/-.
The objective of internal auditing is to assist the Audit Committee/ Management in the
effective discharge of their responsibilities by furnishing them with analysis,
appraisals, recommendations and pertinent comments concerning the activities reviewed.
Besides conducting transaction audit with adherence to legal and regulatory requirements,
Internal Audit is to evaluate the adequacy of risk management and internal control system
in the Company. While focusing on effective risk management and control in addition to
appropriate transaction testing, the Internal Audit offers suggestions for mitigating
current risks and also anticipate areas of potential risks. The quarterly Internal Audit
Report is being placed before the Audit Committee for its information and review.
Reporting of Frauds by Auditors
During the year under review, Auditors has not reported to the Audit
Committee (under Section 143 (12) of the Companies Act, 2013) any instances of fraud
committed against the Company by its officers or employees, the details of which would
need to be mentioned in the Board's report.
C&AG Audit
The Comptroller & Auditor General of India (C&AG) vide its
letter dated 21-07-2023 has conveyed "Nil" comments on the accounts of the
Company for the year ended March 31, 2023. Copy of the same is annexed to this Report.
Adoption of new Memorandum of Association and Articles of Association
In line with the approval of the Board at its Meeting held on
11-02-2020, the proposal for adoption of new set of Memorandum of Association and Articles
of Association had been taken up with the Administrative Ministry for its approval vide
Company's letter dated 11-03-2020. The approval from Ministry is awaited.
CORPORATE SOCIAL RESPONSIBILITY
During the Financial Year 2022-23, the Company has spent H589.96 lakhs
towards CSR expenditure, including projects identified as ongoing for FY 2022-23 and to be
completed during FY 2023-24 of H196.10 lakhs, set-off of excess CSR spends of H34.98
lakhs, in terms of the CSR activity recommended by the CSR Committee and approved by the
Board of Directors, from time to time. The brief outline of the Corporate Social
Responsibility (CSR) initiatives undertaken by the Company during the year under review
form a part of this Report as an Annexure in the format prescribed in the Companies
(Corporate Social Responsibility Policy) Rules, 2014 and amendments. For other details
regarding the CSR Committee, please refer to the Corporate Governance Report, which is a
part of this report. The CSR policy is available on weblink
https://www.kioclltd.in/table.php?id=282.
KEY INITIATIVES
Environmental Management and Pollution Control Measures
Your Company has taken initiatives to address the cause of global
environmental issues and as a part of the initiatives, following has been carried out:
A 80 KLD capacity Sewage Treatment Plant is operational in
Pellet Plant Unit. A 2 Km length sewerage system is connected to the STP. The sewage is
being treated adopting Membrane Bio Reactor. The treated effluent is completely recycled
in the process.
A mobile water sprinkler of 6 KLD capacity is continuously
operated for suppression of fust in Plant premises.
Safety
The Onsite Emergency Plan approved by Director of Factories is in
existence for both Pellet Plant and Blast furnace unit. The same will be updated as and
when there is a change in plant condition as well as emergency team members and emergency
mock drills are conducted to practice the role of each member of emergency teams. The
previous mock drill was conducted on 13-12-2022 in CPP-PPU. Worker's participation in
Safety Management System is one of the important subjects as per the Factories Act. The
Company has formed area wise safety committees. Worker's participation in these
Safety Committees is ensured in PPU and BFU units of KIOCL. The safety committee meetings
are conducted on 24-03-2022, 20-07-2022, 25-10-2022, and 04-01-2023 in PPU and 07-05-2022,
27-01-2023 (BFU). The Safety Audit by an external agency has been conducted in the month
of May 2022 through a reputed Govt. agency M/s National Safety Council, Mumbai, as per
statutory requirement and to maintain the plant premises in a safe condition. The next is
planned in May, 2024. A very effective administrative tool of educating the
employee's regarding safety is tool box talk which is being in practice in both units
on daily basis to educate all the workmen including contractors.
Safety Inspections are carried out regularly once in a week and once in
two months by the Safety officer/staff along with concerned department engineers and
Safety committee members. The observations made during Inspection are noted and reported
to concerned departmental heads for compliance.
Internal cross departmental Safety audit has been conducted along with
a Committee members, formulated by competent authority to conduct as per Standard
checklist IS: 14489. The previous internal safety audit was held in Dec, 2021 and next
external audit is planned in the month of May, 2023.
Suitable standard Personal Protective equipment's such as Safety
helmets, Shoes, Respirators, Rain coats, Gloves, Safety Goggles, Face shields, Aprons, Ear
plugs/muffs are purchased and issued to all employees including Contract labors to protect
them against work place hazards.
Various Training programmes are being conducted to inculcate Safety
consciousness and to develop the human resources. The Refresher Training on SOPs and
Maintenance activities, first aid, Firefighting training, Awareness programme on
Environment, Occupational health, Safety, Vigilance Sustainable development, Productivity.
The total training of 4185 Man days, provided for regular employees on the above said
subjects and 1779 Man days for contractors' workmen on Work place Safety asper IMS
requirement and statutory requirements. Sixty-nine ATS trainees are given with 50 RI
classes each and 3450 Man days training on, on-the job skill development training also 277
Technical college students are provided with one week each Internship training during 2022
and 2023.
As per The Factories Act 1948, the Company is conducting National
Safety week celebrations. The previous National Safety week celebration was conducted on
March 4, 2023 to March 10, 2023. The Safety Boards and Emergency contact telephone
number's boards are displayed in KIOCL PPU and BFU sites every year.
Steel Safety code
The Steel Safety Code is studied and adopted in the Company. Regular
training is provided for all employees in phased manner to all Executives from top to
front line supervisors.
ISO Certification
KIOCL was certified with ISO 9001: 2015 for Quality Management System,
ISO 14001: 2015 for Environmental Management System and ISO 45001:2018 for Occupational
Health and Safety Management System under registered number R191/9103. The accrediting
Agency M/s International Certification Services Pvt Ltd, Mumbai, issued ISO
recertification for all above mentioned standards as Integrated Management System (IMS) on
14-01-2022 and it is valid up 08-11-2024. To comply with IMS ISO standards, KIOCL is
conducting internal departmental audits, management review meetings and apex committee
meetings as per ISO standards. Every year, the certifying agency is conducting
surveillance audit for confirming the electiveness of implementation of IMS system in
accordance with required ISO standards. The last surveillance audit was done during the
month of January 2023 and the agency recommended for continuation of IMS Certificate.
Implementation of Official Language Policy
To ensure compliance of Official Language Policy of the Union, the
Rajbhasha Department of KIOCL Limited takes every action. This covers activities broadly
divided into three main categories, i.e. (i) Training, (ii) Translation, and (iii)
Implementation.
An employee of Company received prestigious Rajbhasha Nistha shield
during Hindi Salahkar Samiti meeting chaired by Honourable Union Minister held in Gangtok
on 13-05-2022. Shield was received by Chairman-cum-Managing Director, KIOCL Limited. As
another achievement Pellet Plant Unit of Company secured third prize for Official Language
excellence from TOLIC, Mangaluru.
During the year Rajbhasha Department scheduled Official Language
Implementation Committee meetings, organised workshops and conducted Official Language
inspections as per targets of the Annual Program 2022-23 of Department of Official
Language (Ministry of Home Affairs). During the year Chairman-cum-Managing Director marked
his remarkable presence in Hindi Salahkar Samiti Meeting held in Gangtok on 13-05-2022 and
Varanasi on 31-08-2022 and received accolades from Honourable Minister of Steel.
Chairman-cum-Managing Director received Bhartendu Harishchandra Award on 08-12-2022 from
BEL Corporate Office in a competition conducted for Chief of Offices under aegis of TOLIC
(PSU), Bengaluru.
Inspection was carried out by the third Sub-Committee of the Committee
of Parliament on Official Language on 04-11-2022 at Corporate Office at Bengaluru. A Hasya
Kavi Gosthi was organised on 31-12-2022 at Corporate Office and honourable Union Minister
of State for Steel and Rural Development Shri Faggan Singh Kulaste graced the occasion as
chief guest.
During the year Company participated in Second All India Conference on
Official Language held in Surat on 14-09-2022. Subsequently the Company organised
various Hindi competitions during Hindi Pakhwada, 2022 in which all groups of employees
participated. Incentive scheme for original work in Hindi has been implemented in the
organisation and total 41 employees were rewarded with cash prizes this year. The
E-Magazine of Company Shrigandha' was published and the link of the e-magazine
was also provided on the website of the Company and Official Language Department (Ministry
of Home Affairs) under E-Pustakalay segment.
Vigilance
Preventive vigilance has been the thrust area of Vigilance Department
all these years and the same has received focused attention during the year. A climate of
preventive vigilance is generated to sensitize officials at all levels about the ill
effects of corruption and malpractices. Regular Structured Meeting of Vigilance with the
management is being conducted and issues related to system improvements, e-governance,
Leveraging Technology, Tender Management, Award of Works, Recruitment Policy have been
discussed.
The Vigilance Department is certified for compliance to ISO
certification 9001-2015 standards to ensure continuous improvement in Quality Management
System. Certificate is renewed and is valid till January 29, 2025. e-Procurement is in
vogue and the threshold value for this is fixed at H 2 Lakhs and above. During the year,
94.51% of contracts by value are covered under this. All payments are being made through
electronic mode. During the Year, 196 work/purchase/sale orders have been issued
incorporating Integrity Pact Clause, covering 97.48% of contracts by value. No complaints
have been received under Integrity Pact. 66 Scrutiny / examinations, 38 checks /
inspections were carried out during the period and corrective actions, if any were
suggested. Necessary action is taken as regards to the complaints received during the
year.
As a new initiative, publication of quarterly "Vigilance
Newsletter" commenced from January, 2022. These are circulated among Officers and
employees through e-mail, WhatsApp and also available on the website of KIOCL. They bring
out the latest O.M.s and Circulars issued by various Ministries/Departments of Government
of India and Central Vigilance Commission which have bearing on the working of KIOCL for
compliance with a view to keep employees abreast of Rules, Regulations and Guidelines.
Also, articles on relevant topics and initiatives taken by other organizations in areas of
systemic improvement and preventive vigilance which can be a model for adoption to improve
working are shared which would add to the knowledge of the employees and benefit the
Company. Vigilance Awareness Week was observed from October 31 to November 6, 2022 at all
the locations/offices of KIOCL Limited. The theme of this year's Vigilance Awareness
Week was "Corruption free India for a developed Nation;
^??>MMMA W?$ ^MAV - {DH${GV ^MAV". Workshops, Guest
Lectures,
Sensitization programs & vendor meet were conducted during the
week. Essay, slogan writing and quiz competitions were conducted among the employees.
Essay writing competitions were also conducted for students of Schools & Colleges. On
this occasion, the importance of observing the Vigilance Awareness Week and steps taken to
strengthen vigilance activities were highlighted.
Vigil Mechanism
Your Company has a Whistle Blower Policy and has established the
necessary vigil mechanism for Directors and Employees in confirmation with Section 177(9)
of the Act and Regulation 22 of Listing Regulations, to report concerns about unethical
behaviour. The details of the policy have been disclosed in the Corporate Governance
Report, which forms part of this report and is available on link
https://www.kioclltd.in/table. php?id=279. During the period under review, no person was
denied access to the Chairman of the Audit Committee.
Integrity Pact
With the commitment to maintain the highest standard of transparency
and governance, your Company has entered into an integrity Pact with Transparency
International and has also appointed Independent External Monitors (IEMs). Structured
Meetings are held with IEMs on regular intervals and threshold value is H 30 lakhs for
signing of Integrity Pact for purchase / works contracts.
Details of Independent External Monitor (IEM)
Dr. Yatindra Pal Singh, IRSE (Retd.) and Shri. Paul Antony, IAS (Retd.)
have been appointed as Independent External Monitors (IEMs) for Implementation of the
Integrity Pact Programme in KIOCL Ltd with effect from 27-08-2022 for a period of three
years.
Compliance of recommendations made by the Committee on Papers Laid on
the Table (Rajya Sabha) in its 150th Report
Details of cases initiated / disposed-off during 2022-23: -
The details of vigilance cases initiated / disposed-off during 2022-23
are as under: -
No. of cases pending as on 31-03-2022 |
3 |
No. of cases initiated during 2022-23 |
0 |
No. of cases disposed-off during 2022-23 |
1 |
No. of cases pending as on 31-03-2023 |
2 |
Nature of pending cases: -
1. Favouritism in various recruitment and promotions made in KIOCL.
2. Irregularities in appointment of First Aid Superintendent in Port
Trust Hospital, NMPT while on deputation from KIOCL.
Officers involved |
2 |
Charge sheets issued on |
26-08-2021 & 27-04-2022 |
Disciplinary proceedings |
One is under finalisation. |
|
Second stage advise of CVC
awaited in another case. |
Audit Paras:
There is no pending Audit Para from C&AG during the year under
review.
Expenditure on R&D
At KIOCL, R&D activities and innovation initiatives are being taken
up departmentally based on the need on continuous basis to improve upon the existing
process system, bring down the cost of production and to achieve the set targets. The
expenses are also covered as per the provisions made in the budget. During the financial
year 2022-23, following R&D activities have been taken up: -
The High Efficiency Rotor Assembly is operating at
full load most of the time. The design of the impeller is more than 35 years old and
presently better design impellers with better efficiency are available. Hence the matter
was taken up with various fan manufacturers for supply of better efficiency impeller which
can be mounted on the existing foundation, bearing supports and casing. Already an Order
no. 407360-I dated 15-12-2020 is placed on M/s. Boldrocchi India Pvt. Ltd. for the supply
of high efficiency impeller. The High efficient Rotor assembly for VZ-31 FAN delivered on
April 11, 2022. High Efficiency Rotor Assembly was installed in Recuperation Fan to
improve operation. Performance checked and found satisfactorily. The expenditure on
Design, manufacture and supply of High Efficiency Rotor Assembly is H 72,00,000/-
Reduction in length of CB92 conveyor: - As the fines
storage Silo is not being used, the length of the pellet loading conveyor CB92 was reduced
by 120m by relocating the tail pulley. The advantages of this modification are (a)
Reduced power consumption to the extent of 20% and (b) Reduced maintenance cost. Due to
the reduction in length, we were able to reduce installed quantity of idlers, brackets,
conveyor belts amounting to a cost of H 26,10,600/- there by leading to equivalent
reduction in inventory costs.
Fixing of VFD for Thickener underflow pump PS125, in
place of fixed speed drive. With the fixed speed drive, PS125 was running at full
load, which is not always desirable. Sometimes it is required to run at lesser RPM to
control the pump density. With the fixing of VFD for PS125, the following advantages are
achieved:
1) Better control of pump density which improves the process
efficiency.
2) Reduction in power consumption, as the pump needs to run at on
average of 75% of full load to achieve the desired density. The cost of VFD is H
3,78,800/-. This cost will be paid back in one year even if the pump runs at 75% load for
6 hours in a day for 300 days in a year.
Procurement of raw material from sources other than NMDC
During the year under review, your Company has procured around 20,616
MT of Iron Ore Fines from sources other than NMDC.
MSME Act, Section 21 & Filing of Form MSME-1
As per MSME Development Act 2006, where any MSME vendor supplies any
goods or renders any services to any buyer, the buyer shall make payment within 45 days
from the day of acceptance of goods/ services. Where any buyer fails to make payment to
the supplier within 45 days, the buyer shall be liable to pay interest on that amount.
A total amount of H84.80 crores was paid to MSME vendors during the
Financial Year 2022-23 and the details of the amount released and the number of days to
which the payments were released are furnished below:
(H in crores)
0 - 15 days |
15 - 30 days |
30 - 45 days |
> 45 days |
Total |
71.93 |
10.70 |
2.17 |
- |
84.80 |
The Ministry of Corporate Affairs (MCA) issued a notification on
22-01-2019 states that specified Companies having outstanding dues to the MSME (Micro,
Small and Medium) enterprises have to file the particulars of all current outstanding dues
in Form MSME-1 with the ROC (Registrar of Companies). Since, your Company had no payments
outstanding for more than 45 days to the MSME supplier, form MSME-1 was not required to be
filed during the year.
Implementation of Public Procurement Policy for MSEs
In line with the Govt. of India guidelines as per MSME Development Act
2006 and keeping in view of the effective implementation of Public Procurement Policy for
Micro and Small Enterprises (MSEs) Order 2012, following steps were taken by the Company:
List of item components that could be sourced from MSEs were
posted on the Company's website at www.kioclltd.in for the information of MSE
vendors.
Communication sent to all the registered vendors regarding the
said policy with the objective of achieving an overall procurement from MSEs. Further, for
enhancing the procurement from MSEs owned by SC/ST, all the vendors were approached for
capturing necessary details and update the data bank.
During the FY 2022-23, Company placed orders for Goods &
Services for a value of H 163.48 crores from MSE's which constituted 39.15% of the
total procurement value of H 417.62 crores (excluding iron ore fines and furnace oil).
The procurement from MSMEs complies to Public Procurement Policy during
the financial year 2022-23 as placed below:
(Rs in crores)
1 |
Total annual procurement |
417.62 |
2 |
Target %age of annual procurement |
25% |
3 |
Total value of goods and
services procured from MSEs (including MSEs owned by SC/ST entrepreneurs) |
163.48 |
4 |
Total value of goods and
services procured from only MSEs owned by SC/ST entrepreneurs |
4.38 |
5 |
% age of
procurement from MSEs (including MSEs owned by SC/ ST entrepreneurs) out of total
procurement |
39.15% |
6 |
% age of
procurement from only MSEs owned by SC/ ST entrepreneurs out of total procurement |
2.68% |
7 |
% age of procurement from Women
MSEs |
3.62% |
The deficit under the targets and sub-targets was due to
non-availability of vendors, several initiatives were undertaken to identify the
entrepreneurs for procurement of goods and services from MSEs owned by SC / ST
enterprises.
Trade Receivables Discounting System (TReDS) platform
In exercise of powers conferred by Section 9 of the Micro, Small and
Medium Enterprise Development Act, 2006 (27 of 2006), the Central Government has issued
instructions that all CPSEs shall be required to get themselves on boarded on the Trade
Receivables Discounting System (TReDS) platform, set up as per the notification of the
Reserve Bank of India. In compliance with the above instruction, your Company is on the
TReDS platform to facilitate financing of trade receivables of MSEs by discounting of
their receivables and realisation of their payment before the due date. During FY 2022-23,
no complaint was filed by the MSEs, on MSME SAMADHAN Delayed Payment Monitoring
System.
Procurement from Government e-Marketplace (GeM)
During the Financial Year 2022-23, the Company had placed 438 orders on
GeM amounting to H315.91 crores against H 260.72 crores during the previous Year
Right to Information
In consonance with the spirit of Right to Information Act, 2005 the
Company has created necessary mechanism as required under the Act. The Public Information
Officers and Appellate Authorities are effectively responding to the requests and appeals
of the applicants. The names of all PIOs/ Appellate Authorities are displayed on the
Company's website. During the year, 40 RTI applications were received and were
disposed-off within stipulated time.
Energy Conservation, R&D, Technology Absorption, Forex Earnings
& Outgo
Details of Energy Conservation, R&D, Technology Absorption and
foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies
Act, 2013 read with Rule, 8 of the Companies (Accounts) Rules, 2014, is annexed to this
report.
Appreciations and Acknowledgement
Your Directors gratefully acknowledge the support, co-operation and
guidance received from the Hon'ble Minister of Steel, Hon'ble Minister of State
for Steel, Hon'ble Chief Minister of Karnataka, the Secretary, Ministry of Steel and
other officials of the Ministry of Steel as well as other Ministries of the Government of
India, Government of Karnataka, Odisha, Tamil Nadu and all other departments / agencies of
Central and State Government in all the endeavours of the Company. The Board is also
thankful to all its stakeholders, including bankers, investors, members, customers,
consultants, technology licensors, contractors, vendors, etc., for their continued support
and confidence reposed in the Company.
Your Directors appreciate and value the contribution made by every
member of the KIOCL family.
For and on behalf of the Board of Directors
|
Sd/- |
|
(T. Saminathan) |
Date: 09-08-2023 |
Chairman-cum-Managing Director |
Place: New Delhi |
DIN: 08291153 |
|