JSW Steel IR 2018-19 Final PDF
JSW Steel IR 2018-19 Final PDF
JSW Steel IR 2018-19 Final PDF
GREAT LEADERS
INSPIRE COUNTLESS LIVES,
LEAVE EVERLASTING MEMORIES,
TO FOREVER GUIDE DESTINIES
Way back in 1952, an age before the phrase entered public discourse, Shri O. P. Jindal heralded ‘Make in
India’ with a small scale manufacturing unit in his home town of Hisar in Haryana. In its ground-breaking
wake came a pipe manufacturing company, the Jindal Group, and an industrial folklore built with steel and
power.
For more than five decades, as young India, born from colonial subjugation to democratic freedom, built
itself into a modern state, Shri O. P. Jindal epitomised enterprise, nationalism, innovation and social service.
He sired and took his eponymous business organisation to stellar heights, strengthening at every step his
commitment to social work and nation building.
On this day, countless individuals in the Jindal family and beyond, salute his spirit, which will forever guide
our destiny.
Index
Corporate overview Page 8-9 Message from the CMD Page 16-18
Reporting frameworks
The statutory and financial section of the The disclosures presented in the Report
Report is in line with the requirements of are mapped with the following additional
the Companies Act, 2013 (including the reporting standards and principles on
rules made thereunder), Indian Accounting sustainable development:
Standards, the Securities and Exchange
• Global Reporting Initiative (GRI)
Board of India (Listing Obligations and
Standards: Core option
Disclosure Requirements) Regulations,
2015, and the Secretarial Standards. • Sustainable Development Goals (SDGs)
of the United Nations
The non-financial section* of the
Report is in line with the International • National Voluntary Guidelines (NVGs)
Our reporting suite Integrated Reporting <IR> Framework by
the International Integrated Reporting
Access our previous reports and Council (IIRC).
presentations at
www.jsw.in/investors/steel/
investor-relations-steel
Reporting period Management responsibility
1 April 2018 to 31 March 2019 statement
The management of JSW Steel
Scope acknowledges their responsibility in
The information contained in the Report ensuring the integrity of the Integrated
pertains to JSW Steel, its national and Report. The management also confirms
international subsidiaries, joint ventures that the Report addresses all material
and associate companies. matters pertaining to the organisation and
its stakeholders, and communicates the
organisation’s ability to pursue prospects
and mitigate risks.
The non-financial information is limited to the Company’s major manufacturing operations in India.
*
Report navigation
To aid navigation and to indicate cross-referencing, the below
icons have been used through the Report.
Manufactured Natural page reference risk
Financial
Social and relationship Intellectual capital Human capital Strategic priority Material issue
capital risk
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
India
A growing
economic
powerhouse
19.5 million
Houses to be built in
rural areas4 30%
Electric vehicles
target by 20305
300 MTPA
Steel production target by 2031
announced by government
1. International Air Transport Association 2. Regional Human Development Report of the United Nations Development Programme (UNDP)
3. World Economic Forum 4. IBEF : Union Budget 2019-20 analysis 5. Niti Aayog
Commitment to
Digitalisation Skilled workforce
health and safety
In the last 25 years, we have built a long-lasting association with all our stakeholders
and have contributed to the country’s economy. Inspired by this trust and
confidence, we will continue to focus on all our economic, social and environmental
commitments, and work towards contributing to a circular global economy.
It is our singular aim to grow in an efficient and responsible way and participate in
India’s progress.
Natural capital 3
Iron ore mines operationalised
Includes resources such Read more on natural capital in
as iron ore, coal and other Climate Change [Page 78-81] and
minerals along with air, water,
energy, land and biodiversity,
Conserving Resources [Page 82-85]
discussions
3.79 m3/TCS
Specific water consumption
which are either utilised by
the Company or impacted
by its operations.
4.5 MnT
Material reused and recycled
Note: The information for financial and manufactured capital is at the consolidated level, while other information pertains to JSW Steel Ltd., unless stated otherwise.
*Million Tonnes Per Annum **Million Tonnes
Community development
Read on
page 86-91
Corporate overview
The Company has robust technological competence with a JSW Steel has a strong marketing and distribution network across
combination of state-of-the-art steel-making technologies such India, along with export presence in 100 countries across five
as Corex, Direct-Reduced Iron (DRI) and Blast Furnace (BF). continents. As on 31 March 2019, the Company had over 9,500
To stay on the leading edge of technological advancement, exclusive and non-exclusive retail outlets across India.
the Company has entered into a collaboration with JFE Steel
In line with the Indian Government's vision of increasing Indian
Corporation, Japan, for manufacturing high-strength and
steelmaking capacity to 300 MnT by 2031, JSW Steel envisions
advanced high-strength steel for the automobile sector.
increasing its domestic capacity in India to 45 MnT over the same
The Company has also entered into a joint venture with time period.
Marubeni-Itochu Steel Inc., Tokyo, to set up state-of-the-art
Key metrics
12,599
Employees
` 48,715 crore
Capex pipeline till FY 2021-22
Vision Values
Bring positive transformation to Confidence
every life we touch
Courage
Purpose
Building world-class infrastructure, Commitment
products and solutions
Compassion
Deploying world-class capabilities
Collaboration
Nurturing our communities
Integrated
manufacturing
process
Strong distribution
network and export
presence
6
Iron ore mines
7
Manufacturing facilities
100+ Countries
Market presence
Diversified Technological
product competence
portfolio
Global presence
Geographic presence
World-class steelmaking.
Worldwide distribution.
JSW Steel features among the list of the world’s top 20 steel producers in terms of tonnage.
The Company is also one of the largest steelmakers in India with seven state-of-the-art,
strategically located facilities within the country. Apart from its domestic production units,
the Company has acquired facilities in Italy and in the US to further its strategic global
footprint. The facilities, operating at one of the most efficient EBITDA/tonne levels, have
enabled JSW Steel to be a leading producer with a large portfolio of Value-added and
Special Products (VASP). JSW Steel's subsidiaries include JSW SCPL, JSW SPCL, JSW ARCL,
JSW Industrial Gases and JSW Salav.
Capacity 5 MTPA
Strategically connected to a 15 MTPA
capacity jetty
JSW Steel - Piombino
Read a detailed
(previously Aferpi) review on page 124
Acquired in 2018
#
DRI/HBI - Direct Reduced Iron / Hot Briquetted Iron
A wide-ranging
domestic reach
Under the banner of JSW Shoppe,
the Company has set up a vast retail
Vijayanagar Works presence across the length and
Key product(s): Crude steel breadth of India, where customers can
access the top range of steel products
Capacity 12 MTPA and steel-related services, including
financing. Run on a franchisee model,
• World’s sixth-largest steel plant
JSW Shoppe is an initiative by
• India’s largest single-location steel JSW Steel to offer branded steel and
plant steel products to semi-urban and rural
markets.
• India’s most productive steel plant
Read a detailed
review on page 121 9,500+
Exclusive and non-exclusive
retail outlets
Salem Works
Key product(s): Crude steel 575
Districts covered
Capacity 1 MTPA
~50%
India’s largest special alloy steel plant
GI/GL - Galvanised/Galvalume
*
Product portfolio
• Cold-formed sections
• Furniture • Automotive
• Heat plates
products • Construction
automobiles
Landmark projects
Ready to ride
high with India
Dear Shareholders,
It gives me great pleasure to report yet
another remarkable year at your Company
– one that validates our actions towards a
'Better Everyday' and our contribution to the
story of 'New India' that’s taking gigantic
strides on to the world stage.
Scaling new peaks of India’s top 50 companies, Nifty50, in the scale is unprecedented. India has set a
September 2018 was a clear validation of target of becoming a US$5 trillion economy
FY 2018-19 was indeed a year of two
our growing scale and influence, not just in by 2024, and to bring that target within the
halves for India – with very strong
terms of market capitalisation, but also in realm of reality, the government is likely to
business environment in the first half and
terms of our ability to consistently create spend heavily on developing social as well
a challenging second half after the onset
value for our stakeholders. JSW Steel as economic infrastructure.
of certain strains in the overall financial
was also recognised as one of the “Steel
system. Regardless of this, we continued The ongoing affordable housing scheme,
Sustainability Champions” 2018 by World
to increase our domestic market share in dedicated freight and industrial corridors,
Steel Association.
FY 2018-19. We delivered strong profitable "Make in India" initiatives and the newly
performance on higher steel spreads in launched project to provide piped water at
Favourable domestic business
the first half, focussed on cost reduction every home have significant potential to
environment
and brought about favourable change in propel urban as well as rural steel demand.
our portfolio mix towards Value-added and After a two-year strong steel cycle, an Next-generation infrastructure, gas grids,
Special Products (VASP). increase in supply, coupled with trade water grids, highways, etc. could witness
actions, led to a fall in steel prices globally significant investment boost.
We recorded the highest-ever production,
towards the end of Q3 of FY 2018-19.
shipments, revenue and EBITDA during The Indian economy is likely to grow at
Further, a series of counter-trade actions
FY 2018-19. Our capacity utilisation was around 7% over the next decade. As GDP
by various countries following the
at its highest at 93%, driven by improved growth and steel consumption growth
imposition of Section 232 by the US led
utilisation levels in the Vijayanagar and have displayed a strong correlation in
to diversion of steel exports into India by
Salem plants, which led to a 3% increase recent past, steel demand is likely to
steel surplus countries like Japan, South
in production volumes. Our EBITDA, which grow at around 6-7%, which implies that
Korea and China. This combination of lower
reflects the strength of underlying the country would need to produce an
international steel prices and increasing
improving operational excellence stood additional 7 MnT of steel every year with
imports weighed on domestic steel prices
at `18,952 crore. Our balance sheet is consumption expected to cross the
as well.
strong with cash and cash equivalents 100 MnT milestone in 2019.
of `6,269 crore as of 31 March 2019. The That said, with the general election
Board of Directors has recommended a overhang now behind us and given the Well positioned to capitalise on
dividend of `4.10 per share for the year. strong mandate, the central government opportunities
is likely to push through key structural
This year, our Vijayanagar plant received In line with the Indian Government’s vision
reforms and infrastructure development
the world’s most coveted recognition for of Indian steel capacity increasing to
projects at full throttle, at least for the
quality, the Deming Prize, for outstanding 300 MnT by 2031, from 140 MnT currently,
foreseeable future.
practices in managing continuous JSW Steel’s Vision is to increase our
improvements across all functions. India is home to 1.3 billion people and has domestic capacity in India to 45 MnT
Deming Prize is like a Gold medal for a favourable demographics with 65% of the – and have a global capacity footprint
large-scale manufacturing enterprise and population below 35 years age. India is of 10 MnT over the same time period.
is testimony to our operational excellence. modernising, urbanising and managing We are in the midst of a large organic
The inclusion of JSW Steel in the National the rising aspirations of a large population; growth programme involving a spend
Stock Exchange (NSE) benchmark index this is a unique opportunity in itself and of about `48,700 crore over FY 2017-18
to FY 2021-22 to expand capacity (from Works are facilitating enhanced tracking facilitated the sustenance and livelihood of
18 MTPA to 24 MTPA; modernise and and predictability of the schedule of the local community.
expand downstream capacities), achieve our ongoing expansion project, which
As a large steelmaker, we depend on natural
backward and forward integration and will drive on-time completion within the
resources for running our operations.
cost reduction. We strengthened our raw budgeted cost.
Across the value chain, we strive to reduce
material sourcing by securing six iron
We have created ‘connected factories’ in the usage of water, energy and other
ore mines in the recent mining auctions.
procurement and large capital projects resources and recycle them wherever
We acquired facilities in the US and Italy,
to track and manage various processes, possible. We have undertaken several
and a joint control with AION Capital in
which has improved transparency and projects across our facilities to minimise our
Monnet Ispat & Energy Limited (MIEL)
lowered manual interventions. Computer environmental impact. Our capacity expansion
through the Insolvency and Bankruptcy
vision-aided video analytics is being used projects ensure that all new production units
Code (IBC) route. We are also awaiting
to drive manual process time reduction, exceed compliance under the Indian as well
approvals from the adjudicating authority
enhance throughput and improve as Euro emission norms.
for our bid for Bhushan Power and
productivity of Steel Melting Shops (SMS).
Steel Limited.
Big data and analytics-driven real-time The road ahead
Fiscal prudence and a relentless focus on models are being used to reduce power
Globally, and especially in India, steel is
efficient capital allocation is our guiding consumption and associated losses.
expected to witness sustained demand
principle. In sync with this, we continue
In the past two years, we have growth. Trends such as recyclability,
to pursue returns-accretive projects with
implemented over 100 digital technology light weighting and better design are on
a strategic intent of continuing to deliver
projects across manufacturing, the horizon and are expected to impact
industry-leading returns through the cycle.
supply chain, sales and procurement, consumption patterns. We expect large
Our best-in-class technology and which helped generate approximately demand for high-tensile, high-strength steel,
sustained R&D initiatives helped deliver `180 crore in accrued saving. We have tailored to our customers’ requirements.
customised and innovative offerings. envisaged additional cost saving of
As we move forward, we will continue to
We remain strategically focussed `300 crore in FY 2019-20 from digital-led
focus on maximising value per tonne in steel,
on enriching our portfolio mix, VASPs projects. We will pursue further digital
driven by technology and R&D, and drive
are finding increasing applications in initiatives to create differentiation and
portfolio mix shift towards 50%+ of VASP.
automobiles, construction and appliances. innovation. Using analytics, robotics and
Our expansion projects will focus on value
We have a strong and expanding domestic hybrid cloud, we are aligning business
accretion and profitability while catering to
retail presence, with over 9,500 direct and processes with the dynamic sectoral and
the nation’s growing appetite for steel for
indirect outlets, distributing contemporary economic realities.
developing infrastructure and catapulting
steel products.
itself to a global economic superpower over
Being better by doing good
Vijayanagar Works is poised for even higher the next decade.
operational efficiency in FY 2019-20. We are driven by integrated thinking and
As we continue our journey of scaling new
In order to transport iron ore from the follow a multi-capital approach to value
peaks while being better everyday, I would like
mine to the plant, we installed the world’s creation (including other non-financial
to thank the Board for guiding me to execute
longest, 24-kilometre-long conveyor pipe, dimensions of capital like human, social,
my responsibilities in the best possible
which will ensure zero spillage of raw intellectual and natural). We maintain
manner. I would like to extend my gratitude
material while transporting and reduce the an unwavering focus on Environment,
to each and every member of our team for
cost of transportation. The conveyor pipe Health and Safety (EHS) and engage
their relentless efforts in making JSW Steel a
will also lower our carbon footprint and continuously with the communities who
leading steel company in the world. I would
contribute towards traffic decongestion are in the direct impact zones of our
also like to thank all our stakeholders, Board,
by eliminating diesel trucks in the operations. That’s why, our Corporate
Bankers and the Government authorities
transportation process. Social Responsibility (CSR) initiatives go
for the support and assistance provided
way beyond compliance. The outreach
throughout our journey.
Ushering in Industry 4.0 programme at JSW Foundation has been
instrumental in positively impacting the I solicit your continued cooperation.
We have deployed various new-age
lives and livelihoods of more than 1.5
technologies, including Industry 4.0
million people.
interventions such as Machine Learning,
Sincerely,
Internet of Things (IoT) and Artificial In Vijayanagar, our hospital equipped with
Intelligence (AI); powered simulations the latest medical facilities and trained Sajjan Jindal
and optimisation engines; and computer doctors continues to play a crucial role in
vision to enhance productivity, minimise ensuring a healthy community. In Dolvi, our
human intervention and ensure greater mangrove plantations have helped regain
safety. The digital tools deployed at Dolvi the lost ecological balance, and have
Performing for
a better everyday
During the year, JSW Steel continued to perform better than the previous years across all metrics. A
comparative, five-year summary of key financial and operational performance indicators has been
given below. Key sustainability indicators can be found on page 81 and 85.
Gross turnover
(in ` crore)
15.6% Operating EBITDA
(in ` crore)
28.11%
FY19 82,499 FY19 18,952
(in %)
Profit after tax
(in ` crore)
23.08%
FY19 22.4 FY19 7,524
(in `)
22.91% Contribution to government and society
(in ` crore)
8.22%
FY19 31.60 FY19 12,769
(in ` crore)
8.16% Net debt equity ratio
(in times)
Shareholder metrics
(in `)
28.13% Book value per share
(in `)
24.73%
FY19 4.10 FY19 142.08
Operational metrics
(in MTPA)
3% Saleable steel sales
(in MnT)
1%
FY19 16.69 FY19 15.60
Value chain
• Action strategic tie-ups to bolster integration • Continued leveraging in-house state-of-the-art blend
process with international and national entities management system
2 INBOUND
LOGISTICS
24 km
World's largest pipe conveyor
• Installed the latest technology to reduce • Installed Industry 4.0 technologies and
consumption of water in operations commenced the journey towards digitalisation
• Monitoring and conserving energy through • Manufacturing facilities expansion forms the major
waste heat and gas recovery part of the `48,715 crore capex plan to be actioned
through FY 2019-20 to FY 2021-22
4 PROCESSING 52
New grades developed/customised during the year
5 OUTBOUND
LOGISTICS
19.3 MnT
Total outbound logistics handled in FY2018-19
6 USE 53%
VASP share in sales portfolio in FY 2018-19
The environment
we operate in
Global economy Indian economy
According to the International Monetary The Indian economy continued
Fund (IMF), global economy grew at 3.7% in its growth momentum. In FY 2018-19,
CY 2018, compared to 3.8% in CY 2017. the economy grew at 6.8% compared to
The world economy faced headwinds owing 6.7% in FY 2017-18.
to the US and China trade disputes and
geopolitical tensions across some regions. OUTLOOK
According to the IMF, India’s growth rate
OUTLOOK is expected to pick up to 7.3% in CY 2019
The slowdown from CY 2018 is expected and 7.5% in CY 2020. The growth will be
to continue in the first half of CY 2019 too. supported by recovery in investment
The IMF pegs the global growth rate at 3.3% and a more expansionary monetary
for the year, down from 3.6% previously. policy stance.
However, in the second half of CY 2019,
growth is expected to be steady with a
gradual stabilisation in emerging markets
and fading headwinds in the eurozone.
OUTLOOK OUTLOOK
World Steel Association expects global demand for finished steel World Steel Association forecasts overall steel demand in India
to grow marginally by 1.3% in CY 2019 to touch 1,735 MnT and 1.0% to be above 7% in CY 2019 and CY 2020. Demand is likely to
thereafter in CY 2020 to reach 1,751.6 MnT. grow to 100-105 MnT, with per capita consumption improving
to 75-76 kg, driven by heavy infrastructure spending and faster
Global steel demand (MnT )
economic growth.
4.9 1.3 1
By FY 2025-26, Indian steel demand is expected to be over
1,752
1,735 150 MnT – from just about 100 MnT now. This will be driven by large
1,712 spends on infrastructure build-out, increasing urbanisation and
rising consumption.
CY18 CY19 CY20
India steel demand (MnT )
Source: World Steel Association
*Note: China closed most of its outdated induction furnaces in CY 2017, a category
which was generally not captured in official statistics. With closure of the induction 7.5 7.1 7.2
furnaces, the demand from this sector of the market is now satisfied by mainstream 110
steelmakers and therefore captured in the official statistics in CY 2017. Consequently, 103
the nominal growth rate for steel demand in China increased to 7.9% or 835 MnT.
Disregarding this statistical base effect, Worldsteel expects that the underlying
96
growth rate of China's steel demand for CY 2018 will be 2.0%, which will make the
corresponding global growth rate 2.1% (Source : Worldsteel).
CY18 CY19 CY20
Demand growth (%) Source: World Steel Association and JPC
Trends Opportunities
1. INDUSTRY 4.0 INTERIM BUDGET `83,016 crore
allocated towards
Industry 4.0 is making huge The Finance Minister announced major investment
road transport and
waves in the way businesses push for the infrastructure sector in the Interim Budget.
highways.
conduct their operations. The government announced an allocation of ` 4.56 lakh crore
With the capability to gather for the sector, with communications and Indian
and analyse data across Railways getting a share of ` 38,637 crore and
`8,350 crore
machines with more accuracy ` 66.77 billion, respectively. to boost telecom
and flexibility, it has begun infrastructure
a manufacturing revolution
and steel companies are CONSISTENT INVESTMENTS With an
increasingly adopting the ways
of "smart production". The
With the Indian GDP expected to continuously grow, the steel economic
industry is expected to get the necessary push. Even as the
use of AI systems is allowing
country’s GDP growth remains above 5%, steel elasticity would
growth rate
the steel industry to run
almost- autonomous steelworks.
be at around 1.1%. Given the growth estimates for Indian GDP of ~7%, India
of around 6-8% at least for a decade, the steel sector could
grow at 7%.
would need
2. RECYCLABILITY
OF STEEL to produce
Given the fact that steel STEADY GOVERNMENT an additional
maintains an average of 86%
With the outcome of 2019 elections in favour of a steady
7 MTPA of
recyclability, a substantial
quantity of steel demand can be
government at the centre, the Indian economy is expected to steel to cater
be supported with uninterrupted implementation of ongoing
met using converted steel scrap.
reforms and programmes.
to the growing
With the use of right processes
and scientific methods, steel
demand
scrap belonging to lower value
steel products can be converted
into high-value steels. Challenges
On average, new steel SLOWING GLOBAL ECONOMY SLOWING DOMESTIC
products contain 37% CONSUMPTION
According to the Organisation for Economic
recycled steel*
Co- operation and Development (OECD), India’s consumption growth has recorded
continued trade disputes can further broaden, a slight decline. In April 2019, the sales of
3. DEMAND FOR impacting the world economy adversely. It automobiles across segments in India fell
BETTER DESIGN believes that the global economy will weaken 16% to touch the lowest in eight years, while
Lightweight, high-strength to 3.2% in CY 2019. This would be the slowest domestic air travel contracted 4.5% for the
and high-tensile steel is being pace in three years and down from rates of first time in nearly five years. Volume growth
demanded by customers about 5% before the financial crisis. in leading FMCG companies that derive more
worldwide. They find increasing than a third of sales from rural areas has
applications in automobiles and also dropped.
white goods. TRADE PROTECTIONISM Source: SIAM and DGCA
Today, the strength of In CY 2018, the US imposed a 25% tariff on
steel in a vehicle’s body steel imports. In response, the European
RAW MATERIAL AVAILABILITY
structure can reach Union and Canada moved to safeguard
1,500 MegaPascals, their own producers from a surge in steel According to the rating agency India Ratings,
which is over 8x imports. These safeguards have bolstered a delay in auction of iron ore mines, whose
stronger than 50 years domestic production and capacity utilisation licences are expiring by March 2020, could hit
ago* rate. However, they have had a negative steel production significantly in the country.
impact on sectors such as construction, Licences of 288 merchant mines, of which
*Steel Facts by World Steel
automotive, infrastructure, etc. With a decline 59 mines are under operation, will expire by
Association
in demand from the aforementioned sectors, March next year.
steel companies across the globe are facing
Find a detailed discussion on the economy and the steel
uncertainty.
industry on pages 106-115
Business model
Processes
Value 1
model
2
Outputs Outcomes
Revenue: `84,757 crore Dividend declared: `1,195 crore
EBITDA: `18,952 crore Market capitalisation: `70,837 crore*
PAT: `7,524 crore Included in the Nifty 50 benchmark index
ROCE: 19.6%
Credit rating domestic: AA (long term), A1+ (short term)
Debt to equity ratio: 1.19
Credit rating international: Ba2 (Moody's), BB (Fitch)
Crude steel production: 16.69 MnT Among the largest producers and exporters
VASP produced: 8.3 MnT of steel in India
Capacity utilisation: 93% Domestic market share: 13.6%
Ranked 2nd at Steel Sustainability Champions
Award 2018 by World Steel Association
8th position in world-class steel makers
ranking by World Steel Dynamics (WSD)
Diversification of
product profile and
customer base
Strategic Backward
growth integration
Strategic
focus areas
Mainstreaming
sustainability in Focus on resource
business imperatives optimisation
Prudent financial
management
Action Plan • Maintain leadership through value–accretive organic and inorganic opportunities
• Undertake brownfield expansion at relatively low investment cost
FY 2018-19 • 5 MTPA brownfield expansion at Dolvi progressing as per schedule (expected commissioning by March 2020)
Progress • Acquired Acero Junction Inc. (USA) (steelmaking Capacity of 1.5 MTPA) and Aferpi S.p.A (Italy) (downstream capacity
of 1.32 MTPA)
• Joint controlling stake in MIEL (steelmaking capacity of 1.5 MTPA)
Outlook • Continue to evaluate organic/inorganic growth opportunities to achieve 45 MTPA capacity in India and global capacity foot-print of 10 MnT
by FY 2030-31
FY 2018-19 • 11% y-o-y increase in domestic sales compared to the 7.5% y-o-y increase in Indian steel demand
Progress • 20% rise in high margin auto sector sale vs automotive production growth of 6%
• ~53% in overall sales contributed by VASP
• 50 bps increase in domestic market share to 13.6%
• 52 new grades developed/customised, of which 3 grades are first-to-market
• 9,500+ retail outlets covering 575 districts pan-India
• 0.25 MTPA tinplate capacity commissioned at Tarapur
FY 2019-20 Focus on completion of 3.95 MTPA additional downstream capacity and commission between FY 2019-20 and FY 2020-21.
Focus Projects include:
• CRM-1 complex expansion at Vijayanagar from 0.85 MTPA to 1.8 MTPA
• Modernisation and capacity enhancement at Vasind and Tarapur by 1.5 MTPA by setting up PLTCM
• Set up 0.3 MTPA colour coated line at Vijayanagar and 0.25 MTPA colour coated line at Rajpura
• Additional 0.25 MTPA tinplate line at Tarapur
• Set up 0.5 MTPA Continuous Annealing Line (CAL) at Vasind
• Two new lines of 0.45 MTPA for construction-grade galvanised products at Vijayanagar
• Enhance capacity by 0.22 MTPA of Pre-Painted Galvalume Line (PPGL) at Kalmeshwar
Outlook • Continued focus on increasing the share of VASP to 60% of the portfolio, to enhance margins
• Company to leverage reach through international acquisitions
Action Plan • Achieving sustainable and secure supply of key raw material by evaluating assets in India and abroad
• Targeting strategic tie-ups and investment
FY 2019-20 • Operationalise the remaining three captive iron ore mines in Karnataka
• Moitra coal block with reserves of ~30 MnT to be operational by FY 2020-21
Focus
• Revamp existing mill in Texas and set up melt and manufacture steelmaking facility in phases, as part of expansion and
modernisation at JSW Steel (USA)
• Evaluate setting up another EAF and additional equipment at Ohio facility to make it a 3 MTPA fully integrated unit
• Set up of 8 MTPA pellet plant and 1.5 MTPA coke oven plant at Vijayanagar to reduce costs
Outlook • To participate in Government’s iron ore and coal auctions to improve backward integration
• Evaluate opportunities to increasingly use domestic coal
• Target to source upto 50% of iron ore requirement captively
FY 2018-19 • Commissioning of 1.5 MTPA coke oven battery at Dolvi by DCPL to eliminate procurement of coke
• 93% plant capacity utilisation vs 91% in the previous year
Progress • Reducing logistics cost by port optimisation and usage of Cape vessels
• 60+ digital initiatives implemented and cost savings of ~`180 crore achieved, over the last two years
• Pipe conveyor system near to completion, for transport of raw material from the mines to Vijayanagar plant
• Tailing beneficiation plant has improved iron content in feed to pellet and sinter plant at Vijayanagar
• Additional coke injection system and relining of stove of BF-3 at Vijayanagar has reduced fuel consumption
• Commissioning of coke oven battery at Dolvi to eliminate procurement of coke
FY 2019-20 • Setting up of Phase-2 coke oven plant of 1.5 MTPA at Dolvi along with Coke Dry Quenching (CDQ) facilities
• Set up 175 MW Waste Heat Recovery Boilers (WHRB) and 60 MW captive power plant to harness flue gases and steam from
Focus CDQs at Dolvi
• Diversifying the coal procurement basket and optimising cost through dynamic coal blends
• Increase Pulverized Coal Injection (PCI) to reduce fuel consumption
• To implement the identified "Deep Drive Projects" with savings of over ~`1,000 crore
• Utilise digital increasingly, with a target to generate additional cost savings of over `300 crore
• Turnaround JSW Ohio (Acero), JSW Piombino (Aferpi) and MIEL operations
FY 2018-19 • Vijayanagar Works received the prestigious Deming Prize for excellence in Total Quality Management
• 18 patents filed
Progress • 4.5 MnT material recycled
• 0.35 LTIFR
• Implemented ISO 50001, to promote energy management best practices
• International consultant "DuPont" engaged for rolling out international safety standards
• Continued "Million Trees Plantation Mission" at Dolvi and Karav
• 2 MOUs signed with Bombay Natural History Society (BNHS), Mumbai and People for Environment (PFE), New Delhi for
biodiversity assessment in JSW Steel Complex
Enablers
1 ONE OF THE LEADING DOMESTIC STEEL • Well placed to benefit from strong economic
fundamentals
PLAYERS AND WELL PLACED TO BENEFIT • Lower cost from commencement of captive
120
100
US$/t rebased to 100
80
60
40
13 4 14 15 15 17 17 8 8 19
p- r-1 v- n- c- l-1
6 b- p- r-1 t-1 y-
Se Ap No Ju De Ju Fe Se Ma Oc Ma
Source: Platts, Steelmint India HRC China HRC North Europe HRC Change in prices between
01 January 2016 to
15 May 2019 (%)
India apparent steel consumption expected to grow significantly (%)
India HRC 34.4
13.2
China HRC 93.3
11.4
NorthEurope
HRC 68.5
7.9 7.5
6.8
5.9
3.9
3.1
Enablers
Flexibility to judiciously shift between domestic and international markets based on market conditions
15 16 12 13
24 26 25 24
76 85 84 74 88 75 76 87
76
54 58 53
24
Enablers
CONVERSION COSTS •
•
Installation of captive power plant
Setting up pellet plant and coke oven
World-Class Steelmaker Rankings places JSW Steel among the top global steel companies based on
SUMITOMO METAL
multiple evaluation parameters
NUCOR
ALPINE
POSCO
VOEST
Parametera
Expanding capacity 10 9 8 9 7 6 6
Labour costs 10 7 7 8 5 9 6
Cost-cutting efforts 9 7 10 6 10 8 8
Aggregate rank 8 15 1 2 3 4 5
a
ll quoted numbers are scores assigned out of 10 on World Steel Dynamics' World-Class Steelmaker Rankings as on June 2018
A
b
On the basis of weighted average score out of 10 across 23 different parameters from World Steel Dynamics' World-Class Steelmaker Rankings as of June 2018
2,740
2,139
1,760
925
12,253
10,584
8,752
6,647
Enablers
Bonds and
` Debt debentures
54 23
6,101 6,265 5,695 7,552
916
capacity
increase of
3.95 MTPA
6,415
Crude steel
capacity
increase from
18 MTPA 911
to 24 MTPA
3,021
Trade-offs
CAPITALS
Human
Financial capital Manufactured capital Intellectual capital
STRATEGIES IMPACTS
The Company’s organic and The organic and inorganic The growth initiatives
inorganic strategic growth strategic growth initiatives would result in acquisition
initiatives are fuelled by would result in an addition of new technologies and
large investments, which of steelmaking assets. technical knowhow, thereby
S1 may temporarily reduce the enhancing JSW Steel’s
STRATEGIC financial capital.
technical capabilities.
GROWTH
The resultant growth due
to the strategic initiatives
would positively impact the
capital in the long term.
At JSW Steel, our integrated thinking process serves as the benchmark for organisational decision making.
As the organisation progresses towards delivering on its strategic priorities, it identifies the various positive
and negative impacts it makes on internal and external stakeholders, represented through capitals.
Social Natural
Human
Financial
Human capital Social and Natural capital
relationship capital
IMPACTS
As the Company grows, the As JSW Steel expands its operations, Since the Company operates in a
cumulative strength, skills and the number of stakeholders resource intensive business, its
competencies of our workforce positively impacted by the Company dependence on natural resources
increase, thus positively contributing increases, while simultaneously would increase proportionately with
to the human capital. enriching the relationship with the the growth initiatives. However, to
existing stakeholders. minimise any negative impact on
nature, JSW Steel adheres to global
efficiency norms and standards,
which will help improve the
environmental performance of its
operations.
Diversification of product profile and A diversified product range would Development of new products with
customer base would be achieved increase the marketability of the better environmental performance
by enhancing the skillset of the products, thus enhancing the will enable customers to use less
workforce. customer base. material, and utilise products
with better lifespan and improved
productivity, thereby positively
impacting natural capital in the
long term.
Improved integration will increase Backward integration would increase Value chain integration would
the workforce along with its the total number and types of in-effect increase the cumulative
knowledge about the steel value stakeholders of the Company. This environmental footprint of the
chain, positively impacting the would also further benefit vendors, Company. However, JSW Steel is
human capital. customers and communities. committed to following international
norms and best practices to
minimise the environmental impacts
of all its operations.
Short & long term Short term Long term Positive impact Negative impact
Trade-offs
CAPITALS
Human
Financial capital Manufactured capital Intellectual capital
STRATEGIES IMPACTS
S4 Optimal utilisation of Improvement in utilisation Deployment of the latest
FOCUS ON resources would help of resources would technology and processes
RESOURCE reduce operational cost and be partly achieved by to optimise the resource
OPTIMISATION lead to higher profitability. technology upgradation of utilisation would positively
the manufacturing capacity. impact the stock of
intellectual capital.
Social Natural
Human
Financial
Human capital Social and Natural capital
relationship capital
IMPACTS
This strategy would improve the per Focus on resource optimisation Judicious utilisation of resources
person productivity of the Company, would enable the Company to offer would enable the Company to
fuelled by improvements in the better products at competitive produce more with lesser impacts on
skillset of the employees. prices to its customers. This will lead the natural environment.
to enhanced customer satisfaction.
This strategy will enhance the Financial discipline helps give The Company gives utmost
Company’s growth prospects, further better returns to the Company’s importance to reducing its
providing growth and development stakeholders, while simultaneously environmental impact at all
opportunities for employees. supporting the society. times, and its prudent financial
management makes available
capital for continued investment in
environment friendly technologies
and processes.
Improvements in the sustainability Better and harmonious relations Due to the nature of JSW Steel’s
performance of the Company would with the local communities and the business, natural resources
also include provision of a safer work society in general will be supported are extensively utilised across
environment for the workforce. by the Company’s CSR activities. operations. However, embedding
sustainable practices across facets
of operations – including better
management of resources, waste
and emissions – results in reducing
impact on the environment.
Short & long term Short term Long term Positive impact Negative impact
Stakeholder engagement
JSW Steel’s stakeholder engagement strategy seeks feedback on The Company has formal mechanisms in place to engage
a regular basis, which is then integrated into the organisation’s key stakeholder groups in a constructive manner and collect
medium- and long-term strategy and planning exercises. This also valuable feedback. This proves to be a valuable input for the risk
enables the Company to promote the idea of shared growth and a assessment and strategy formulation process of the Company.
common prosperous future for the society at large.
Government • Official communication channels: Advertisements, • Aligning with the government to support
and regulatory publications, website and social media economic development
bodies • Phone calls, emails and meetings • Continued contribution to the exchequer
• Regulatory audits/inspections
Investors • Analyst meets and conference calls • Sustainable growth and returns
• Annual General Meeting • Excellent operational performance
• Official communication channels: Advertisements, • High standards of corporate governance and
publications, website and social media risk management
• Investor meetings and roadshows
Materiality
As part of the continued efforts of the Company to identify topics that are crucial to its
ability to create long-term value, a detailed stakeholder engagement and materiality
assessment exercise was undertaken in FY 2018-19.
• Raw materials
• Energy
• Economic performance
• Water
• Indirect economic
• Emissions
impacts
• Effluents and waste
• Environmental
compliance
pital Nat
ura
l ca lc
ia ap
nc
a
ita
Fin
l
hip capital
Materiality
linkages
Hum
ons
a
i
n
lat
cap
re
nd
ital
a
cial
So
I nt e l l e
ct u al c a pital
• Employment
• Procurement • Occupational
practices health and safety
• Local communities • Training and
education
• Innovation
Risk management
Proactively managing
externalities
Success in a challenging and dynamic external environment is largely dependent on an organisation’s ability to be agile and respond
to changes quickly and effectively. This forms the basis of the risk management process at JSW Steel, which is well geared to identify,
assess and manage traditional as well as new-age risks, thereby protecting stakeholder interests, achieving business objectives
and enabling sustainable growth. JSW Steel follows the globally recognised Committee of Sponsoring Organisations of the Treadway
Commission (COSO) framework for risk management. The Company has constituted a sub-committee of Directors to oversee the
Enterprise Risk Management framework. It monitors risks related to performance, operations, compliance, incidents, processes and
systems and tracks their mitigation plan till their closure.
Strategic risks
Stakeholders Capitals Linkage of
Risk type Strategic response
impacted impacted material topics
Financial
Financial
Financial
Mergers and • Appropriate due diligence process followed before M&A • Investors •
Economic
Acquisitions
Human
Human
Strategic risks
Stakeholders Capitals Linkage of
Risk type Strategic response
impacted impacted material topics
Financial
Operational risks
Stakeholders Capitals Linkage of
Risk type Strategic response
impacted impacted material topics
Natural
Financial
• Emissions
Manufactured
Human
Natural
Financial
• Effluents
and civil Manufactured
and waste
society
Human
Human
• Training
• Opportunities for skill enhancement and career and education
development for all levels
• Enhancing gender diversity
• Platforms for greater interaction between employees and senior leaders
• Long-term succession planning
Financial
Human
Compliance risks
Stakeholders Capitals Linkage of
Risk type Strategic response
impacted impacted material topics
Human
Governance
JSW Steel engages with leading industry bodies and organisations for policy advocacy and works towards the improvement of public
good, thereby creating value for all. Through these engagements, the Company supports the government in framing policies in the
following areas:
JSW Steel engages with the following associations and organisations: World Steel Association, CII, FICCI, ASSOCHAM, Indian Steel
Association, GRI, DJSI, CDP, UN Global Compact, Bangalore Chamber of Industry & Commerce, Karnataka Iron & Steel Manufacturing
Association, Indian Institute of Metals, American Society of Metals, Association of Iron & Steel Technology (US), Iron and Steel Institute of
Japan, PMS (Metal Society of USA), Indian Chamber of Commerce and Bengal Chamber of Commerce & Industry.
Board of Directors
Balanced Board of Executive and Non-executive
Independent Directors with diverse range of expertise and experience
Board committees
Business
Nomination & responsibility/ Stakeholder Risk
Audit
remuneration sustainability relationship management
reporting
Hedging
Project Corporate social Finance
policy JSWSL ESOP
review responsibility
review
Information Human
Legal Safety Commercial
technology resources
6 10
Independent Directors Board committees headed
on the Board by Independent Directors
Governance
The Company’s Board of Directors consists of global thought leaders who create trust by example. They instil hope and confidence
about the future and make employees feel enthusiastic and proud of being part of the journey. They are the leaders who are helping
translate JSW Steel’s vision into a reality. In FY 2018-19, the Board of Directors held four meetings.
*KSIIDC subsequently withdrew the nomination of Mrs. Gunjan Kinnu, IAS w.e.f 08 May, 2019 and nominated Mr. Gangaram Baderiya, IAS, as its nominee on the Company's Board w.e.f 24 May, 2019
• Value added: Council member of the Indian Institute of Metals, • Value added: Strategy formulations related to business
member of the Executive Committee and Chairman of the development, expansion of existing businesses, joint ventures,
Sustainability Committee of World Steel Association, M&As and cost management
as well as the former President of Institute of Steel
• Appointment date: 06 April 1999
Development and Growth
Governance
• Value added: With over 30 years of • Value added: Rich experience in all • Value added: Awarded the "Best CFO" on
experience in the steel industry across aspects of M&As, creditor restructuring, multiple occasions, he has experience
various countries, he brings unmatched foreign investment, joint ventures and in building and managing the global
international expertise foreign collaborations operations of TCS in its early days
• Appointment date: 17 May 2017 • Appointment date: 30 September 2015 • Appointment date: 27 July 2016
Mr. Harsh Charandas Mariwala Mr. Gangaram Baderiya Mrs. Nirupama Rao
• Independent Non Executive Director • Nominee Director, KSIIDC • Independent Non Executive Director
• Value added: Over the past three • Value added: He has rich experience • Value added: India’s first woman
decades, he has transformed a of working with the State Government spokesperson in the Ministry of External
traditional commodities driven business and various Corporate Bodies. He Affairs and has a four-decade-long
into a leading consumer products and is responsible for spearheading diplomatic career
services company. implementation of infrastructure
projects including projects on Public
Private Partnership [PPP] basis
Key Board committees
AUDIT COMMITTEE (A) RISK MANAGEMENT STAKEHOLDERS RELATIONSHIP
COMMITTEE (RM) COMMITTEE (SR)
Chairman: Mr. Seturaman Mahalingam
Chairman: Mr. Malay Mukherjee Chairman: Mr. Seturaman Mahalingam
Function: Audit Committee, a
sub-committee of the Board of Directors, Function: To periodically review risk Function: To periodically look into the
comprises Independent Directors. The assessment and minimisation procedures functioning of the Company’s shareholder/
Audit Committee regularly reviews audit and ensure that the Executive Management investor grievance redressal system
plans, significant audit findings, adequacy controls risk by means of a properly defined and oversee improvements in the same,
of internal controls, compliance with framework, besides reviewing major risks besides reporting serious concerns, if any
accounting standards, etc. and proposed action plans
Number of meetings held: 2
Number of meetings held: 7 Number of meetings held: 2
Function: Responsible for the adoption Function: To closely monitor the progress
of National Voluntary Guidelines on of large projects, in addition to ensuring a
Social, Environmental and Economic proper and effective coordination among the
Responsibilities of Business (NVGs) in the various project modules, essentially with
business practices of JSW Steel the objective of timely project completion
within the budgeted project outlay
Number of meetings held: 2
Number of meetings held: 4
Execution in action
Capacity
building
S1 | S3
SDGs targeted
Capacity building
Acquisitions
Acero Junction Inc. (US) JSW Steel has acquired the
steelmaking facilities of Acero Junction
Inc. with the aim of expanding its
global presence and locally providing
steel-related products to the American
market. Going forward, the facility
is expected to be evaluated for
manufacturing capacity expansion of
up to 3 MTPA.
1.5 MTPA
Integrated facility, with 3 MTPA
finishing capacity
1.3 MTPA
Finishing capacity
1.5 MTPA
Total capacity
JSW Steel’s key projects such as the expansion of crude steel capacity at Dolvi Works from 5 MTPA to 10 MTPA,
capacity expansion of CRM-1 complex at Vijayanagar Works, modernisation-cum-capacity enhancement at
downstream facilities of JSW Steel coated products and strategic cost savings projects have progressed
satisfactorily for commissioning as per schedule. A key consideration while executing such projects is that all
equipment should have best-in-class environmental attributes and should be able to meet European emission
standards.
The work pertaining to revamping and capacity upgradation of BF-3 at Vijayanagar is progressing satisfactorily.
After taking into consideration strong domestic demand conditions, and with a strategic intent of ensuring
no volume loss for FY 2019-20, the Company has decided to defer the shutdown of BF-3 at Vijayanagar for
upgradation. The plan will be implemented at a later period after the new BF at Dolvi gets commissioned by
March 2020 and starts ramping up. All other projects at Vijayanagar such as Steel Melting Shop (SMS), caster
and wire rod mill will continue towards completion as per original schedule of March 2020.
`48,715 crore
Capex plan till FY 2021-22
With a cumulative cash outflow of `14,371 crore in the last two years, the Company plans to spend about
`34,300 crore over the next two years with some spillover to FY 2021-22. With this, the Company is now implementing
a cumulative capex spend of `48,715 crore (net of capex projects put on hold during the year) over FY 2017-18 to
FY 2020-21.
These projects will be planned and funded by a mix of debt and internal accruals. The intended plan is expected to
improve crude steel capacity by 27% from 18 MTPA to 24 MTPA and VASP capacity by 44% from 5.6 MTPA to 8.4 MTPA.
Increasing Decreasing
Manufactured Natural
Human Financial
Human
Financial
Social
Capacity building
Moving in line with the change in market demand, the Company is focussing on value-added products such as galvalume and
colour-coated products. This has ensured that it has a better product mix than its industry counterparts, owing to cutting-edge
technology provided by JFE.
JSW Steel places quality at the core of all its activities. As an outcome of this effort, JSW Steel Vijayanagar facility was awarded the
coveted Deming Prize, the highest honour for organisational quality in the world. The Deming Prize is given to an organisation for
managing continuous improvements across all its functions.
Training on safety
With the aim of ensuring that all individuals have the right
knowledge regarding safety procedures that need to be
followed in the plants, exhaustive safety training modules have
been created. These modules cover different safety standards
streamlined into training methodologies that were identified
based on specific job requirements and trainings were imparted
accordingly.
1 Conduct safety training programmes (i.e., legal compliances, working at height, confined space entry, emergency
preparedness, road safety, construction safety, excavation safety and learning from previous incidents)
2. Arrange interactive sessions with Factory Directorate Officers with all neighbouring industries
8. Arrange safety skits based on learnings from previous incidents and best practices
Capacity building
Key areas of focus in the adoption include safety observation, incident investigation, permit to work, confined space, work
at height, Lock Out Tag Out (LOTO), road safety, electrical safety, conveyor safety, scaffolding safety, machine guarding, PPE,
lifting of heavy equipment and contractor safety management.
TE Management of
Incident
L technology
NE
CH
investigation change
ON
NO
PERS
LOG
Y
Management leadership
and commitment
Contractors
16.67%
Mechanical
integrity
Injuries
FY19 71
FY18 77
FY17 50
FY16 83
LTIFR
FY19 0.35
FY18 0.42
FY17 0.36
FY16 0.5
Capability
building
S1
SDGs targeted
Capability building
Tin Mill Black Plate using Improved hot metal quality and
Continuous Annealing Line efficiency of BF
Tin Mill Black Plate (TMBP) is an intermediate product for Real-time BF monitoring and decision support has helped
processing tinplate and acts as a raw material for electrolytic improve hot metal quality and reduce fuel rate in BF. The multiple
tinning process. TMBP can be produced using two methods, viz. optimisation models that were installed have helped improve
Batch Annealing Furnace (BAF) and Continuous Annealing Line the productivity, quality and efficiency of hot metal at lower cost
(CAL). BAF was the only method practised in India to produce through real-time equipment monitoring.
TMBP till recently. However, for the first time in the country, TMBP
was produced using the CAL route by JSW Steel. This method
results in high productivity and uniform mechanical properties
along the complete length and width of the produce, making it
suitable for automatic can-making machines.
36.61 MW
Highest-ever power generation from
waste gases (Previous best – 36.51 MW,
FY 2016-17)
Capability building
Talent management
A highly skilled workforce is of prime importance to an As a part of its transformation into a truly digitised organisation,
organisation’s competitive advantage. JSW Steel constantly JSW Steel launched the digital learning initiatives under the
organises trainings for its employees to acquire new skills and “Learning Academy” umbrella. This learning management system
sharpen existing ones. These initiatives have resulted in improved makes bite-sized learning and assistance available to employees
performance and increase in productivity across operations. as and when required through exciting online course content.
A wide spectrum of courses ranging from behavioural,
In FY 2018-19, the main insights for the Company’s learning
interpersonal and functional skills are hosted on the platform. In
needs came from JSW Steel’s Performance Management System,
order to provide further impetus to individual learning, renowned
Future Fit Assessment and the Great Place to Work survey. Based
course packages of Skillsoft and Harvard Managementor are made
on their analysis, the Company launched systematic learning
available to all employees.
interventions for every grade, focussing on the next role capability
building and enhancement of leadership and functional skills.
41,040
Total training hours achieved
85%
Utilisation
JSW Steel honoured with
the Skillsoft Global
of online
resources
Innovation award
Key e-learning initiatives and courses
Employee engagement
JSW Steel respects human rights and is committed to ensuring Avtar Group and Working Mother Media recognised JSW Group as
that they are protected. To this end, the Company has a human a part of 100 Best Companies for Women in India (BCWI) 2018 for
rights policy that addresses human rights issues across the its vision and efforts to create and sustain a work environment
supply chain. It articulates the Company’s stand on human where women can advance and thrive.
rights, including non-discrimination, prohibition of child and
JSW Steel also featured among the shortlisted participants for
forced labour, freedom of association and the right to engage in
the World Steel Association Steelie Awards, where member
collective bargaining. It is complemented by other specific policies
companies are recognised for their contributions to education
such as occupational health and safety, environment,
and training programmes and leadership in enhancing the skills
anti-corruption, etc. Officers of security agencies are trained
of the steel workforce for today and tomorrow.
to act in a manner that respects human rights at all times and
comply with all the applicable national, state and local laws. The Steel Sustainability Champions programme by the
JSW Steel contributes to the fulfilment of human rights through World Steel Association has recognised JSW Steel among
compliance with local human rights legislation wherever it has six companies that have set the example in making tangible
operations, as well as through its policies, programmes and impacts in supporting sustainable development and a circular
grievance redressal mechanism. economy.
No complaints related to child labour, forced labour, involuntary JSW Steel has been also awarded by the DJSI RobecoSAM
labour, or discriminatory employment were received during Sustainability Industry Mover Award in 2018.
the reporting year and none are pending at the end of the
reporting year.
16,885 1,065
Contractual New employee
employees hires
Capability building
82 30.69
FY19 141 2019 22.54
311 17.57
51 13.60
FY18 115 2018 19.74
289 3.41
90 48
FY17 202 2017 37
403 34
52 43
FY16 163 2016 44
506 17
> 50 years 30-50 years < 30 years Management (L8 and above) Non-management Temporary/Contractual
#
Corporate employees excluded from the given disclosures *
T he average hours of training for FY 2017-18 have been revised on account of a
more robust data collection process and estimation methodology
Disclosure JSW SCPL JSW SPCL JSW ARCL JSW JSW JSW
INDUSTRIAL SALAV MINES
GASES
Permanent employees 1,992 25 205 33 382 19
Management 691 8 150 22 98 8
Non-management 1,301 17 55 11 284 11
Male employees 1,960 25 201 32 376 19
Female employees 32 0 4 1 6 0
Contractual employees 2,667 193 – 5 190 53
New employee hires 100 – 0 2 0 1
Resigned employees 86 1 7 2 23 1
Employees at sites
(segmented by age)
<30 years 156 14 57 8 29 2
30-50 years 1,231 9 133 21 222 17
> 50 years 605 2 15 4 131 0
Cost leadership
& financial
discipline
S3 | S5
SDGs targeted
9.1 | 9.4
JSW Steel is in the process of developing and
streamlining logistics infrastructure, including
pipe conveyor systems, thereby making it more
sustainable and reliable
JSW Steel follows a robust system on capital allocation and judiciously allocates capital
amongst various competing capital expenditure projects across locations, with the
least payback periods and compliance to environment and safety related aspects.
These projects include investments in strategic expansion, acquisitions, increasing
value-added capacity, efficiency and cost saving related outlay. Accordingly, every
capital expenditure and mergers and acquisitions, are calibrated to ensure that the
leverage ratios are within the acceptable levels.
Given that the Company has launched an extensive capacity upgradation plan, it
regularly considers financing and refinancing opportunities intended to diversify its
obligations, reduce interest cost and lengthen the maturity profile of its indebtedness.
In order to implement this strategy, the Company’s diversified sources of financing
include a right mix of rupee and foreign currency denominated debt, External Commercial
Borrowings (ECB) and Non-Convertible Debentures (NCD). The Company also leverages
opportunities to raise finance through structured trade solutions to diversify its pool of
liquidity. In March 2019, it raised US$700 million through Advance Payment and Supply
Agreement (APSA).
A strict adherence to these financial management systems and risk control measures
has helped the Company achieve a higher Return on Capital Employed (RoCE), correct
market perceptions, and has resulted into growth in market capitalisation as well as
better credit ratings.
Cost leadership
JSW Steel firmly believes that cost leadership is an accumulation In the last fiscal, JSW Steel strategically focussed on reducing
of innovation, better execution and ensuring customer costs by working on the following areas as a part of its
satisfaction and competitive advantage across all functions, continuous improvement journey:
every single day.
• Commissioning of coke oven battery at Dolvi to eliminate
At `3,500 crore/MnT, JSW Steel has one of the lowest capacity procurement of coke
expansion costs. The Company has achieved this on the back of
• Diversifying the coal procurement basket and optimising coal
the efficiency projects it has undertaken, while the in-house skill
cost by dynamic coal blends
and expertise have reduced the time taken to complete these
projects. • Reducing logistics cost by port optimisation and usage of
cape vessels to reduce freight costs
Today, the Company has a steady ROCE, besides having one of
the lowest financial leverage in Asia and competitive conversion • Increasing Pulverised Coal Injection (PCI) to reduce fuel
costs. JSW Steel depends on domestic as well as international consumption
suppliers for meeting its raw material requirements; however, it
• Operationalised three iron ore mines and using captive iron
prioritises domestic sourcing over imports. In the reporting year,
ore, thereby reducing dependency on imported iron ore
the Company procured 70% of iron ore from domestic sources.
Logistics infrastructure
Due to the high volumes of incoming raw material and outgoing finished goods that
the Company handles, logistics is one of the major cost centres for JSW Steel. In order
to optimise its logistics process and improve costs, special focus is being placed on
streamlining the existing systems using technology.
• Digital tools such as dashboards are used to monitor and In addition to maintaining a strong sourcing strategy, the
streamline the Company's end-to-end supply chain. The Company has invested in a strong backward integration
dashboard showcases real-time view from shipping, ship programme by securing six iron ore mines in the recent open
unloading and Raw Material Handling System (RMHS) to auctions. More auctions are expected and JSW Steel will
the plant. proactively participate in them to derive cost and
logistical benefits.
• This has resulted in optimum ordering and ship schedule,
optimum barge allocation, minimum barge turnaround time, To reduce import dependency and ensure partial security of
maximum equipment utilisation and real-time scheduling of raw material, JSW Steel also engaged in domestic steel supply
RMHS-Jetty-Plant system. initiatives by participating in coal linkage auctions for the
non-regulated sectors. It acquired one coal mine in Jharkhand in
FY 2018-19.
Conveyor system for material handling
Until recently, bulk materials such as iron ore, iron ore fines, coal,
limestone and dolomite were being received through wagon
tippler arrangement from where they were carried to the storage
`84,757 crore
Economic value generated
yard through trucks. With a view to limit the movement of these
trucks, JSW Steel installed a 24-km-long pipe conveyor belt in
Vijayanagar. This has helped in saving fuel and reducing carbon
emissions and dust generation from the roads, while improving
`73,285 crore
Economic value distributed
safety.
Customer
centricity
S2
SDGs targeted
9.5
JSW Steel is developing new products through
continuous improvement in technology
Over the past few years, the Company has been focussing on envisioning, designing
and producing better products and services that meet the customers’ needs and create
seamless experiences across the board. This helps it become a customer- centric brand
that has the ability to build a community of long-term loyal customers.
The Company also regularly organises conferences and customer meets across the
country. These events serve as a platform to network and discuss market dynamics and
challenges.
With an aim to achieve JSW Steel’s ambitious retail plans, a retail- focussed company,
JSW Retail Ltd., has been incorporated. The company has provided a renewed focus on
branded retail products with dedicated manpower and a robust market presence.
JSW Steel continues to focus on value addition for customers and remains a supplier of
choice in all markets, while improving the wellbeing of customers and the society. The
Company is committed to operating processes and conducting marketing promotions in
a transparent and responsible manner by sharing product information. As a responsible
corporate citizen, the Company complies with all regulatory and legal requirements
and does not have any pending cases filed by any stakeholder relating to unfair trade
practices, irresponsible advertising or anti- competitive behaviour.
Customer centricity
Grievance redressal has been a key element of the Company’s customer strategy and it has a
de-centralised system to ensure early resolution of issues faced by customers. In FY 2018-19, the
Company received 1,639 complaints from customers of which 99.8% were resolved. JSW Steel
conducts customer satisfaction surveys through professional third-party consultants covering
aspects such as product quality, order servicing, customer relationship, company personnel and
customer loyalty.
3.88
Customer satisfaction score
3.83
Customer satisfaction score
3.94
Customer satisfaction score
– Overall in FY 2017-18 (3.76 - OEM segment in FY 2017-18 – Retail segment in FY 2017-18
in FY 2015-16) (3.71 in FY 2015-16) (3.88 in FY 2015-16)
●● Based on a recommendation from the Ministry of Steel, JSW ●● An import substitute product was developed and supplied for
Steel developed import-substitute high-carbon wire rods use in tire cord manufacturing.
for the manufacture of wires for textile carding. This was
achieved after the development team made several visits
to understand the application, post which two grades were
supplied to textile carding companies.
●● The Company developed a new ●● New variant of steel developed and ●● The Company initiated alloy steel
variant of steel for coil spring supplied to automobile customers export supply to Aferpi
application, which fulfilled all the providing superior strength
requirements of the client
Climate
change
S6
SDGs targeted
Climate change
JSW Steel is shifting towards better technology and processes Combating climate change
to reduce Greenhouse Gas (GHG) emissions for every tonne
India has pledged to do its bit in the fight against climate
of steel produced. Over the years, a number of initiatives have
change. As the integrated iron and steel manufacturing industry
been taken to improve the energy efficiency and reduce GHG
contributes a substantial portion of the total GHG emissions in
emissions across the manufacturing units. In FY 2018-19, these
India, JSW Steel has devised a strategy to help reduce emissions
initiatives have led to a substantial reduction in direct emissions
in accordance with the norms.
and an increase in energy savings. Some of the key initiatives are
as follows: A few initiatives taken at JSW Dolvi Works in this regard include:
• Hot stove waste heat recovery • Increasing steelmaking via electric arc furnace process
• Installation of energy monitoring and management systems • Exploring possibilities in carbon capture and storage/utilisation
1,05,435
FY 2016-17
3,00,000
FY 2017-18
3,06,942
FY 2018-19
Biodiversity initiatives
• The Million Tree Plantation Project has • At Vijayanagar, extensive biodiversity Forest Department for greenery
been initiated in nearby degraded forest mapping has been undertaken by development outside its premises, with
areas at Dolvi and Karav with a vision experts from BNHS and PFE, thereby special emphasis on biodiversity.
to achieve 1 million tree plantations, identifying 216 IUCN’s Red List species.
• The Company engaged in research and
in collaboration with the forest
• The Company is promoting ex-situ promotion of constructed wetlands for
department. In the year 2018, 26,555
conservation of native red-listed plant Wildfowl & Wetlands Trust, leading to
trees were planted, taking the total
species within the JSW Complex. increased avian and aquatic biodiversity.
number to 2,01,539.
• The Company undertook joint forest • JSW Steel participated in Bird Count
management initiatives with State of India.
FY19 14.3
436.3 FY19 26.14 FY19 93
4.5 MnT
FY19 41,938.35 0.94 Recycled input materials
3,909.96 FY19 1.74
1.29
Conserving
resources
S4
SDGs targeted
Being aware of the fact that efficient use of natural resources is critical to sustainability,
JSW Steel uses advanced technologies and techniques to increase production yield
rates, reduce its energy requirements and facilitate the use of by-products. Without
compromising on operational excellence, JSW Steel optimises resource consumption
at various levels such as the conversion of two-coat paint system to unicoat paint,
reduction of zinc coat thickness and use of reusable steel packaging. Also, recycled steel
(scrap steel) continues to be one of the most important raw materials for the Company.
The Company is also constantly trying to reduce the impact of transporting raw materials
and finished goods. To this end, the Company prioritises domestic sourcing wherever
possible. Efforts are also made to transport maximum cargo via ship/rail. In FY 2018-19,
about 83% of the cargo was transported via ship/rail.
Conserving resources
FY19 13,616.75
129.72
FY18 12,662.79
1,572.00
FY17 12,385.00
119.00
FY16 8,103.00
1,336.00
Non-hazardous Hazardous
Community
development
S6
SDGs targeted
Community development
The Company contributes towards CSR with the aim of mitigating due diligence process. Joint periodic reviews of the project with
the major challenges faced by the communities across all the partner form the basis of course corrections from time to
locations where it has operations. The interventions focus on time. Indicators identified at the project conceptualisation stage
programmes aimed at creating development models that can be are used to ascertain its impact. Projects also include a defined
replicated at scale and adopted across geographies with similar phase-out strategy, ensuring that they are adopted by the
issues. community.
• Solar powered
• Weathering steel
• Unique design
Vijayanagar
• In its commitment to offer sustainable prosperity to the farming
community, the Company treated 17,400 hectares of land
through watershed management around the facility.
Community development
In partnership with ISHA Education, 22 teachers were trained Scholarships received by the students
in remedial methodology and placed in government schools to
Name of the scholarship Nos.
provide remedial education for students from classes 6th to 9th.
10th Toppers Scholarship 24
Education for specially-abled children JSW Rural Scholarship 101
O.P. Jindal Memorial Scholarship 8
With an aim to guide and assist parents, siblings and other family
Total 133
members on how to train their disabled children, funding was
provided to construct a classroom for the specially-abled children
in the Government Boys Higher Secondary School premises.
Assurance statement
To The Board of Directors of JSW Steel • JSW Steel Coated Products Limited (“JSW SCPL”) - Operations
specific to Kalmeshwar, Tarapur and Vasind
Limited
• JSW Steel Processing Centres Limited (“JSW SPCL”)
We have been engaged by the Management of JSW Steel
Limited, to provide an independent Limited Assurance Statement • Amba River Coke Limited (“ARCL”)
on sustainability-related key performance indicators (“SPIs”) • JSW Steel (Salav) Limited, (“JSW Salav”) and
described below and presented in the ‘key performance • JSW Industrial Gases Private Limited (“JSW Industrial Gases”).
indicators’ section of the Integrated report as per the “GRI
Sustainability Reporting Standards (‘In accordance’ - Core)” issued Subject matter
by the Global Reporting Initiative (“the GRI Standards”) in the We are required to provide limited assurance on the following SPIs
Integrated Report of JSW Steel Limited (“JSW Steel/ The Company”) reported in numerical figures, specific to the period from April 1,
for the year ended March 31, 2019 (“the Integrated Report”) 2018 to March 31, 2019 in accordance with management’s basis
covering - JSW Steel, JSW Steel Coated Products Limited (“JSW of preparation and the GRI Standards. The terms of management’s
SCPL”), JSW Steel Processing Centre Limited (“JSW SPCL”), Amba basis of preparation and the GRI Standards comprise the criteria
River Coke Limited (“ARCL”), JSW Steel (Salav) Limited, (“JSW Salav”) by which the SPIs are evaluated for purposes of our limited
and JSW Industrial Gases Private Limited (“JSW Industrial Gases”). assurance engagement.
Project Boundary
Sustainability reporting boundary covers the following operations:
Natural Capital:
Indicators GRI Standard Reporting Entities
Topic Disclosure
Coal JSW Steel, ARCL
Iron Ore JSW Steel, JSW Salav, ARCL
Fluxes JSW Steel, JSW Salav
301: Materials
HRC JSW SCPL, JSW SPCL
Runoff mine (ROM) JSW Steel, Mines
Recycled input materials JSW Steel, JSW SCPL
Energy consumption within the organization JSW Steel, JSW SCPL, JSW SPCL,
ARCL, JSW Industrial Gases, JSW Salav
Energy consumption outside the organization JSW Steel, JSW SCPL, JSW SPCL, JSW Salav
Energy intensity 302: Energy JSW Steel, JSW SCPL, JSW SPCL,
ARCL, JSW Industrial Gases, JSW Salav
Reduction in energy consumption JSW Steel, JSW SCPL, JSW SPCL, JSW Salav
Water withdrawal by source 303: Water JSW Steel, JSW SCPL, JSW Salav, JSW SPCL, ARCL,
JSW Industrial Gases
Water recycled & reused JSW Steel, JSW SCPL, ARCL
Direct Scope 1 GHG emissions 305: Emissions JSW Steel, JSW SCPL, JSW SPCL,
Indirect Scope 2 GHG emissions JSW Mines, JSW Industrial Gases, ARCL
Indirect Scope 3 GHG emissions JSW Steel, JSW SCPL, JSW SPCL,
GHG emission intensity JSW Industrial Gases, ARCL
Ozone depleting substances (ODS) JSW Steel, JSW SCPL, JSW Salav, JSW SPCL
Non GHG emissions (SOx, NOx and TPM/SPM) JSW Steel, JSW SCPL, JSW SPCL,
Water discharge 306: Waste and JSW Steel, JSW SCPL, JSW SPCL
Waste by type disposal: Hazardous Effluents JSW Steel, JSW SCPL, JSW Salav, JSW SPCL, ARCL,
JSW Industrial Gases
Waste by type disposal: Non- Hazardous JSW Steel, JSW SCPL, JSW Salav, JSW SPCL, ARCL
Assurance statement
Human Capital:
Indicators GRI Standard Reporting Entities
Topic Disclosure
Permanent employees (excludes Corporate office)
Management 405: Diversity &
Equal Opportunity
Non-Management
Women
New employees hires
Employees resigned
401: Employment JSW Steel, JSW SCPL, JSW SPCL, ARCL, JSW
Employees (segmented by age)
Industrial Gases, JSW Salav
Employees separated ( segmented by age)
Average hours of training per employee 404: Training And
Education
Reported injuries
403: Occupational
Fatalities Health And Safety
LTI
Assurance statement
Section D: BR Information
1. DETAILS OF DIRECTOR / DIRECTORS RESPONSIBLE FOR BR
# Name DIN Telephone Email ID
1 Mr. Malay Mukherjee 02861065 (91) 11 4103 2905 malayumauk@googlemail.com
Chairman & Independent Director
2 Dr. (Mrs.) Punita Kumar Sinha 5229262 (91) 98333 63533 punitakumarsinha@gmail.com
Independent Director
3 Mrs. Nirupama Rao 06954879 (91) 7022621529 nirupamamenonrao@hotmail.com
Independent Director
4 Mr. Seshagiri Rao M.V.S 00029136 (91) 22 4286 1000 seshagiri.rao@jsw.in
Executive Director
5 Dr. Vinod Nowal 00046144 (91) 8395 283 416 vinod.nowal@jsw.in
Executive Director
6 Mr. Jayant Acharya 00106543 (91) 22 4286 1000 jayant.acharya@jsw.in
Executive Director
3. GOVERNANCE RELATED TO BR
1. Indicate the frequency with which the Board of 3-6 months
Directors, Committee of the Board or CEO to assess
the BR performance of the Company. Within 3
months, 3-6 months, Annually, More than 1 year
2. Does the Company publish a BR or a Sustainability JSW Steel publishes an annual Integrated Report that acts as the Sustainability Report as
Report? What is the hyperlink for viewing this well as the Business Responsibility Report.
report? How frequently it is published? The hyperlink to view all the published reports:
http://www.jsw.in/investors/investor-relations-steel
6 Ensure availability and 6.3 improve water quality Conserving Resources; 83, 87
sustainable management of Community Development
water and sanitation for all
Promote sustained, inclusive and 8.8: Protect labour rights and Capacity Building; Capability Building 55, 63
sustainable economic growth, promote safe and secure
full and productive employment working environment
and decent work for all
Build resilient infrastructure, 9.1: Develop quality, reliable, Cost Leadership & Financial Discipline 71
promote inclusive and sustainable and resilient
sustainable industrialization and infrastructure, including regional
foster innovation and transborder infrastructure
9.2: Promote inclusive and Capacity Building 55
sustainable industrialization
9.4: Upgrade infrastructure Capacity Building; Capability 55, 63, 71, 79, 83
and retrofit industries to make Building; Cost Leadership &
them sustainable Financial Discipline; Climate Change,
Conserving Resources
9.5: Enhance scientific research, Capability Building; 63, 75
upgrade the technological Customer Centricity
capabilities of industrial sectors
in all countries, in particular
developing countries
Reduce inequality within and 10.3: Equal opportunity and Capability Building 63
among countries reduction in inequalities
Ensure sustainable consumption 12.2: sustainable management and Capability Building, 63, 83
and production patterns efficient use of natural resources Conserving Resources
Management
discussion
and analysis
Index
JSW Steel
Organisational
overview
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
JSW Steel Ltd. (JSW Steel), the flagship company of Quick facts
the US$14 billion JSW Group, is an Indian integrated
steel major. The Company has an installed capacity of
18 MTPA across seven state-of-the-art manufacturing
facilities in India.
9,500+
Special Bars and Special TMT, among several others.
They find increasing applications in automobile,
construction and appliances industries. The Company
also has a strong domestic retail presence, with over
Exclusive and non-exclusive retail outlets
9,500 direct and indirect outlets, and exports to over
100 countries across five continents.
3
continuously engages in cost and operating efficiency
improvement programmes across its facilities, which
results in lower operating costs, better quality and
higher profitability. JSW Steel is one of the most
Acquisitions
efficient steel producers in the world with conversion
cost in first quartile.
105
A VISION TO EXECUTE BETTER. EVERYDAY.
1.0
Economic
review
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
1.1 Global economy the effects of US policy stimulus are likely to taper off. Growth
is likely to gradually pick up and stabilise at 3.6% in CY 2020,
MODERATING GROWTH ACROSS THE GLOBE as the centrals banks of most major economies shift to a more
CY 2018 started on an optimistic note with global growth accommodative policy stance and China ramps-up its economic
expectations pegged at 3.9%, driven by strong economic stimulus to minimise the impact of increased tariffs.
activity and policy-level interventions. In the first half of the
year, economic growth remained robust backed by the US fiscal
stimulus plan rolled out in December 2017 and the resilient Region-wise growth outlook estimates (In %)
emerging markets. A steady global oil consumption and rally in oil
prices also supported the growth. Region 2017 2018 2019 2020(E)
However, in the second half of CY 2018, fears of trade wars among World 3.8 3.6 3.3 3.6
major economies, especially between the US and China, weighed
on the growth momentum significantly. In addition to trade wars, AMEs 2.4 2.2 1.8 1.7
geopolitical tensions across regions proved as headwinds. The EMEs 4.8 4.5 4.4 4.8
world economy grew at 3.6% in CY 2018 comparable to CY 2017
levels but below 3.9% expected at the start of the year. ASEAN 5.4 5.2 5.1 5.2
US 2.2 2.9 2.3 1.9
3.6%
Economic China 6.8 6.6 6.3 6.1
The Eurozone witnessed slowdown in growth due to political The World Trade Organisation (WTO) expects global merchandising
uncertainties like Brexit and the disruption of automobile trade volume growth to slow to 2.6% in CY 2019 from 3.0% in
production in Germany caused by the new emission norms. The CY 2018, but could rebound to 3.0% in CY 2020, as the trade
region also witnessed softening of overall external demand from tensions subside. The short- and medium-term outlook appears
emerging Asia. This was further met with a drop in investment in positive, and international bodies including the IMF have urged
Italy due to widening sovereign spreads. the member countries not to escalate trade tensions or tighten
policies that could affect the current situation. There is a broad-
In the Far East, Japan was hit by natural disasters. China’s growth
level consensus on this, though the challenge for them would be
declined following a combination of much needed regulatory
to contain inflationary tendencies while endorsing a neutral to
tightening to rein in shadow banking and an increase in trade
accommodative monetary policy.
tensions with the United States. Emerging market economies such
as Argentina and Turkey remained stressed.
1.1.1 OUTLOOK
The International Monetary Fund (IMF) expects the global
economic growth to further slow down to 3.3% in CY 2019, as
the issues that plagued the major economies in the second half
of CY 2018 are likely to spill over to the first half of CY 2019 and
1.2.Indian economy
INDIA REMAINS THE FASTEST GROWING
MAJOR ECONOMY Government programmes boosting
The Indian economy grew at 6.8% and remained the world’s development
fastest growing major economy despite a visible slowdown in the
The Indian government has rolled out several
fourth quarter of FY 2018-19.
initiatives, such as the National Mineral Policy and
National Electronic Policy, to fast-track development.
Since 2012, India has outperformed the global growth trend Similarly, the Agriculture Export Policy was
introduced with a mandate to double agriculture
Year Global GDP Indian GDP Difference exports to US$60 billion by 2022.
growth rate (%) growth rate (%) The Union Budget (interim) has also announced
2012 3.5 5.5 2.0
several initiatives aimed at socioeconomic
development and enhancing consumption. These
2013 3.5 6.4 2.9 include direct income support schemes for small
and marginal farmers, income tax provisions for
2014 3.6 7.4 3.8
exemption till 5 lakh and pension programmes for
2015 3.4 8.0 4.6 the unorganised sector.
2016 3.4 8.1 4.7
India’s
6.8%
Economic
Growth in
FY 2018-19
India’s Ease THE LIQUIDITY TIGHTNESS PROMPTED THE RBI TO CUT THE
REPO RATE BY 25 BPS TO 6%, THE SECOND CUT IN THREE
77
of Doing MONTHS, MAKING INDIA THE ONLY ECONOMY IN ASIA TO HAVE
Business HAD IMPLEMENTED TWO CONSECUTIVE POLICY RATE CUTS. THE
COMBINED 50 BPS CUT ALSO REFLECTED THE RBI’S INTENT OF
Rank INFUSING LIQUIDITY TO KICKSTART THE ECONOMY WHICH IS
EXPERIENCING A SOFT PATCH.
Average industrial production witnessed marginal growth. As per India’s forex reserves remained buoyant, at US$411 billion during
the latest (April 2019) available data, the eight core industries the last week of March 2019. Merchandise exports grew by 8.75%
together grew at 4.3% in FY 2018-19 with cement, steel, y-o-y to US$331.06 billion and services exports rising 17% y-o-y to
fertiliser and refinery products bolstering the index. The eight US$204.7 billion (Source: Ministry of Commerce and DGFT).
core industries account for ~41% of India’s Index of Industrial
Production (IIP). 1.2.1 OUTLOOK
Prices remained largely benign, led by food articles and oil. According to the IMF, India is expected to grow at 7.3% in CY 2019
Headline consumer price inflation (CPI) remained under the and 7.5% in CY 2020, driven by a continued recovery in investment
targeted 4%. Overall, CPI inflation fell from 3.7% in August- (9.4% growth) and robust consumption. Going forward, the Indian
September 2018 to 2.86% in March 2019, after touching a low of economy is expected to contribute 13.7% to total world economic
2.0% in January 2019. This has a bearing on overall growth and growth, which is higher than that of several developed countries,
employment. Liquidity tightness was evidenced by high credit- including the US (Source: Bloomberg).
deposit ratios and elevated corporate bond spreads.
With the general election overhang now behind us and a stable
During the year, the financial services industry went through a government elected at the centre, any uncertainty around policy
turbulent phase. NBFCs in particular, experienced a liquidity crisis continuity or visibility has subsided. Continued economic reforms,
owing to asset-liability issues, the fallout of which was evident in along with efforts to reduce public debt, is a prerequisite for the
pessimistic investor sentiment and an overall constrained access country’s growth. Given the strong mandate, the government is
to capital. likely to push through key structural reforms towards its ambition
of making India a US$5 trillion economy by 2024.
2.0
Industry
review
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
Supply-side structural reforms by China to capacities, has benefitted market sentiment, pricing power, and
streamline capacities bottom-lines of most Chinese steel producers.
China has taken a conscious call to close excess and inefficient On average, metal prices rose 6% in CY 2018 (Source: World
capacities across various core sectors including steel and coal. Bank), dragged down by broad-based tariffs imposed by the US
Between 2016 and 2020, the country has set a steep target of on China’s imports in the second half. Heightened trade tensions
closing down 200 MnT of inefficient capacity. Till 2017, China dampened market sentiments for global trade and investment
had already closed down 115 MnT of steel capacities. This, prospects. Following the specific tariffs announcement, prices of
coupled with the restructuring of the 140 MnT induction furnace steel and aluminium recouped in the US.
* Note: China closed most of its outdated induction furnaces in 2017, a category which was generally not captured in official statistics. With closure of the
induction furnaces, the demand from this sector of the market is now satisfied by mainstream steel makers and therefore captured in the official statistics in 2017.
Consequently, the nominal growth rate for steel demand in China increased to 7.9% or 835 MnT. Disregarding this statistical base effect Worldsteel expects that the
underlying growth rate of China’s steel demandfor 2018 will be 2.0%, which will make the corresponding global growth rate 2.1%. (Source : Worldsteel)
* Note: The world and regional production figures in this table includes estimates
of other countries that only report annually.
TOP 10 (2020)
Country Steel Demand (MnT)
China 834.9
Top 10 steel-producing countries
India 110.2
Country 2018(MnT) 2017(MnT) % 2018/2017
While China leads production volumes with more than 51% share,
India displaced Japan as the world’s second largest steel producer
at the start of CY 2019. According to Worldsteel, India’s crude steel
production in CY 2018 was at 106.5 MnT, up 4.9% from 101.5 MnT in
CY 2017. Japan produced 104.3 MnT in CY 2018, down 0.3% from CY
2017 levels.
European Union (28) 169.7 170.2 172.2 4.3 0.3 1.2 84.9
India's
Infrastructure boost in Union Budget coking coal
(interim) FY 2019-20: 52.26MnT imports in
• Infrastructure sector was allocated CY 2018
`4.56 lakh crore.
• Communications was allocated `38,637 crore
In CY 2018, India imported 52.26 MnT of coking coal, up 14% from
to develop post and telecommunications
45.93 MnT in CY 2017, primarily driven by the restriction on usage
departments.
of petroleum coke, an alternative to coal, in some parts of the
• Indian Railways was allocated `66.77 billion; country.
of this, `64.59 billion was set aside for capital
expenditures. 2.2.2 OUTLOOK
• `83,016 crore was allocated towards road Worldsteel forecasts overall steel demand in India to grow above 7%
transport and highways. in CY 2019 and CY 2020. Demand is likely to grow to 100-105 MnT,
with per capita consumption improving to 75-76 kg, driven by heavy
• `3,899 crore to increase capacity of Green
infrastructure spending and faster economic growth. Worldsteel also
Energy Corridor Project along with wind and
forecasts that at the current rate, India would overtake the US in
solar power projects.
terms of demand.
• `8,350 crore to boost telecom infrastructure.
In India, iron ore prices mirror the global trend, which peaked at
However, India’s steelmakers face persistent threats of cheaper
US$88/tonne in January and February 2019, its highest since
imports and lower domestic prices. The ongoing trade disputes and
August 2014, due to concerns about supply disruptions. However,
the global economic slowdown are routing Asian steel inventory
the strengthening of the US$ narrowed the spread between
to India, negatively impacting the country’s steelmakers. Since,
landed costs and domestic iron ore prices, contributing to a fall
certain trade remedial actions have become irrelevant, imposition
in imports. Domestic iron ore production is expected to rise by
of safeguard duty is the need of the hour to stop such imports and
2-5%, which should be sufficient to meet domestic demand.
corresponding injury to the domestic industry.
However, this needs to be supported with measures that prioritise
domestic consumption over exports. The government is likely to take tariff and non-tariff measures to
address the issue. It has already asked automakers to cut imports. The
2.2.1.2 Coal list of locally made steel for use in government infrastructure projects
is being augmented, along with more stringent quality control norms
The steel industry has two categories of coal requirement –
for all steel products. The government could auction more iron ore
coking coal and thermal coal (for captive power plants). Thermal
mines to increase raw material supply security.
coal requirements are met through domestic production,
but coking coal needs to be imported, as the coal available Going forward, India’s steel producers are likely to rely more on robust
domestically has a higher ash content and a lower calorific value. domestic demand to maintain healthy margins. Margins could also
be improved through production of high-end value added steel. The
ongoing industry consolidation is expected to drive efficiency.
3.0
Business review
PERFORMING BETTER. EVERYDAY • More auctions are expected and JSW Steel will
proactively participate to derive cost and logistical
In FY 2018-19, JSW Steel achieved its highest-ever crude steel
benefits
production of 16.69 MnT, up 3% y-o-y. Domestic sales volume
grew 11% y-o-y to 13.2 MnT, well above Indian steel consumption 5. Introduce Industry 4.0 technologies in plant operations
growth of 7.5% y-o-y, driven by the increase in market share to • Appointed a Chief Digital Officer
13.6% with primary focus on Southern and Western regions to • Robotics, IoT and sensor-based systems installed
increase realisations. The higher-margin Value Added and Special
Products (VASP) accounted for over 53% of sales volume at 8.3
MnT in FY 2018-19. Sales to the auto sector grew 20%, significantly 3.2 Product performance
above the automobile sector growth rate of 6%.
JSW Steel’s best-in-class technology and sustained R&D
During the year, export markets witnessed a turbulent phase. initiatives help deliver customised and innovative offerings.
Weighing the opportunity in India, the Company strategically The Company remained strategically focussed on enriching its
shifted its focus to domestic markets and maintained its sales product mix by increasing the volume and share of high-margin
momentum. Compared to 77% in FY 2017-18, 85% of the sales were VASP in its portfolio.
directed at domestic markets in FY 2018-19.
Product development
Product development
Automotive High Strength Low Long member General Engineering High Strength Food grain silo
Alloy (HS 800) (for HCVs) (S350GD) Z600
(600 GSM Zinc
coating)
3.2.1.2 Cold Rolled
Cold rolled (CR) steel products are manufactured at Vijayanagar
3.2.1.5 Colour Coated
Works. The CR products segment has a 13% share in the total
product mix, and witnessed an overall domestic growth of 12% Colour coated products comprised 4% of the product portfolio in
y-o-y. FY 2018-19, with domestic sales growth of 4% y-o-y.
Cold rolled products in India are majorly consumed by the The overall growth was driven by the construction and rural
automotive, industrial and engineering sectors. sector, aided by the Company’s brand building and consumer
education drive to identify original JSW coated sheets.
3.2.1.3 Electrical steel
3.2.2 LONGS
Electrical steel finds application across sectors such as electric
motors, generators, nuclear power stations, power generation JSW Steel manufactures a variety of long products such as TMT
plants, domestic appliances, transformers and automotive bars, wire rods, and special alloy steel. The product segment
electricals. Electrical steel sales increased by 17% y-o-y driven by comprised 24% of the product portfolio in FY 2018-19. During the
consumer durables, heavy industrial motors and traction motors. year, long products’ domestic sales increased by 14% y-o-y.
defence, port and airport, expressway and highway, and critical served as a platform for the dealers to network and discuss
atomic power. Neosteel also catered to prominent educational market dynamics and challenges. A Coated OEM customer meet
institutions, hospitals, IT parks and high rises. JSW Neosteel is the was organised in Pune. They were given a virtual tour of the
best quality TMT bar range available in India. Manufactured from Vijayanagar plant to showcase the plant’s innovative technologies.
virgin iron ore in state-of-the-art rolling mills, JSW Neosteel TMT
bars are free from impurities and have uniform properties. 3.3.2.1 Awards from OEM customers
1. JSW Steel received a Certificate of Appreciation from the
3.2.2.2 Wire rods
global auto major Toyota Kirloskar, for meeting all quality
Wire rods are manufactured at Vijayanagar Works and Salem standards for CY 2018.
Works comprising 4% of the product portfolio with domestic sales
2. JSW Steel received a certificate of appreciation from Honda
growth of 8% y-o-y.
for Outstanding Support in Sales Promotion.
3.2.2.3 Alloy steel 3. JSWSCPL received award from IFB for outstanding support.
Alloy steel products are manufactured at JSW Salem Works. The 4. JSWSCPL received Best Supplier Award from Samsung.
Company is the largest domestic producer of spring steels flats,
5. JSWSCPL received award from LG for outstanding support.
alloy steel rounds and bars, alloy steel wire rods and spring
steel flats.
4.0
Operational
review
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
Vijayanagar Works uses state-of-the-art technology to optimise • Process improvements which reduced coke fine
its operations, profitability per tonne and environmental footprint. generation.
Some of them are: • Continued focus on environmental initiatives led
to lower-than-target energy consumption.
a. Ambient air control temperature: To create the
• Strict adherence to safety standards and
toughest, most durable steel
improved employee awareness reduced the lost
b. Corex technology: Used for high smelting intensity time injury frequency rate (LTIFR) to 0.28.
and hence high productivity for steel and hot metal • JSW Steel signed a long term tariff contract
production (LTTC) with the South Western Railways (for
Vijayanagar, Dolvi and Salem Works).
c. Pair-cross technology: To minimise thrust force and
wear between contacting work roll and back up roll
Raw
40.6
material
MT
PA received at
Vijayanagar
Finished
16.7
goods
MT dispatched
PA
from plant
(steel + slag)
4.1.4 CAPACITY EXPANSION ROADMAP 1. Logistics Control Room to act as the central
A
controlling node for all logistics – inbound, in-plant
1. Capacity augmentation to 13 MTPA
and outbound.
Objective: Upgrade BF-3 capacity to 4.5 MTPA hot metal,
enhance SMS capacity, augment existing HSM and Wire Rod 2. RFID for yard management will enable 100%
Mills to support enhanced BF-3 capacity visibility of finished goods inventory
movement
Expected commissioning: March 2020
3. Electrification of railway yards for faster operations.
2. CRM-1 complex capacity expansion
4. Road Trans Hub that can handle up to 5 MTPA road
Objective: CRM-1 complex capacity will be increased dispatches at plant boundary to nearly eliminate
from 0.85 MTPA to 1.80 MTPA along with two Continuous in-plant truck movements and ensure a quicker
Galvanising Line of 0.45 MTPA each, a new 1.2 MTPA turnaround.
Continuous Pickling Line for HRPO products
5. European design for steel loading – first ever in
Expected commissioning: March 2020 India to reduce damage rate and improve dispatch
efficiency.
5.0
Financial review
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
5.1 Standalone higher by 3% with the Vijayanagar and Salem units achieving
higher utilisation levels. Overall capacity utilisation was 93%.
For the steel industry, the year began with a strong underlying
demand and rising international prices, which resulted in higher Revenues increased 13% y-o-y to `76,727 crore, primary due to
spreads and ensured better profitability. However, towards the higher realisations. The Company’s saleable steel volume grew by
second half, on-going trade disputes between US and China 1% y-o-y to 15.76 MnT with domestic sales volume growth at 10%
and slowdown across some of the developed economies, led to outpacing India’s overall steel consumption growth of 7.5%.
softening of the prices and demand for steel globally. Despite the
The Company reduced costs by switching to secondary
headwinds, global steel demand expanded 2.1% in 2018.
benchmarks for coal, strategic switch to low Fe imported iron ore,
Cash flows and profitability in FY 2018-19 was driven by stronger operationalising three iron ore mines and utilising captive iron ore,
steel spreads, as the increase in finished steel products prices and increasing usage of PCI coal in blast furnace to reduce fuel
was higher than the increased price of principal raw materials like consumption.
iron ore and coking coal.
The increased realisations and cost optimisation initiatives helped
In the first half of FY 2018-19, the demand for steel remained the Company report an operating EBITDA of `18,403 crore, up 34%
positive owing to continued government spending on y-o-y, operating EBITDA margin of 24%, and net profit after tax of
infrastructure. Towards, the last two quarters, activities `8,259 crore.
surrounding the national election led to restrained investment
Net gearing was at 1.03 as on 31 March 2019 (vis-à-vis 1.27, as
activity. However, the domestic demand for steel during FY
on 31 March 2018) and Net Debt to EBITDA stood at 1.97x as on 31
2018-19 sustained a growth and increased by 7.5%. Steel imports
March 2019 (as against 2.59x as on 31 March 2018).
increased by 4.7% specifically in coated products. However,
steel exports from India reduced by 26.4%, due to subdued
5.1.2 REVENUE ANALYSIS
international demand and various trade measures. Higher spreads
during the year, was on back of robust steel demand in the (` in crore)
domestic markets and the benign macro-economic activities.
2018-19 2017-18 Change Change %
In this competitive environment, the Company continued to
increase the market share in the domestic market by strategically Domestic 66,841 54,869 11,972 22%
focusing on increasing domestic sales volume. Turnover
This robust domestic demand, focussed cost reduction, backward Export Turnover 7,928 11,366 (3,438) -30%
integration and healthy mix of value added portfolio helped the Total Turnover 74,769 66,235 8,534 13%
Company deliver strong operational and profitable performance
during FY 2018-19. Other Operating 1,958 1,488 470 32%
Revenues
5.1.1 HIGHLIGHTS OF FY 2018-19 76,727 67,723 9,004 13%
Revenue from operations 76,727 67,723 13% Product wise quantity break-up (Mt)
PAT 8,259 4,625 79% Revenue from operations for FY 2018-19 stood at `76,727 crore,
up 13% y-o-y. This revenue was mainly driven by higher average
JSW Steel reported its highest-ever production, shipments, realisations on the back of improved price realisations.
revenue and EBITDA during FY 2018-19. The Company produced
JSW Steel continued to improve its market share as domestic
16.69 MnT of crude steel, up 3% y-o-y. Production volume was
sales surged to 13.9 MnT in FY 2018-19, an increase of 10% y-o-y
compared to 7.5% y-o-y increase in Indian steel demand.
During the year, export markets witnessed a turbulent phase. 5.1.6 MANUFACTURING AND OTHER EXPENSES
Weighing the opportunity in India, JSW Steel strategically
(` in crore)
shifted its focus to domestic markets and maintained its sales
momentum. Compared to 77% in FY 2017-18, 85% of the sales were 2018-19 2017-18 Change Change %
contributed by the domestic markets in FY 2018-19.
Other Expenses 17,025 13,993 3,032 22%
Other operating revenue was higher by `470 crore compared to
FY 2017-18, primarily due to higher incentive benefits recognised Manufacturing and other expenses increased 22% y-o-y to
in FY 2018-19 due to upward revision in incentive rates in the GST `17,025 crore, primarily due to an increase in power and fuel cost,
regime as compared to the previous year where the incentive stores and spares consumption, and hedging cost. Power and fuel
benefits was recognised only for a period of nine months and cost increased 20% y-o-y by `975 crore on account of additional
increase in regional sales and realisations. power purchases and higher steam coal prices. Stores and spares
consumption increased by 35%, largely due to an increase in
5.1.3 OTHER INCOME prices of electrodes and refractories. The hedging cost was higher
as the Company covered its exposures largely through forwards.
(` in crore)
Other income was higher primarily due to the receipt of dividend 2018-19 2017-18 Change Change %
income from its subsidiaries and increase in interest dividend Finance Cost 3,708 3,591 117 3%
income from subsidiaries.
Finance cost increased by 3% y-o-y to `3,708 crore. The margin
5.1.4 MATERIALS increase in finance cost was primarily due to increased working
capital requirements, which was driven by a rise in inventories
(` in crore)
owing to increase in key inputs and receivables. Overall, a
2018-19 2017-18 Change Change % tighthened liquidity scenario, higher steel prices and blockage
of Government receivables, all led to a rise in finance cost. Total
Cost of materials 39,899 37,470 2,429 6% borrowings as on 31 March 2019 stood at `41,937 crore, up from
consumed (including `36,181 crore, as on 31 March 2018.
changes in inventories
of finished goods and 5.1.8 DEPRECIATION AND AMORTISATION
work in progress)
(` in crore)
The Company’s expenditure on material consumption increased
6% y-o-y to `39,899 crore on account of a 3% increase in 2018-19 2017-18 Change Change %
production volumes and increase in raw material prices, Depreciation and 3,397 3,054 343 11%
especially iron ore and coal, and the impact of an unfavourable amortisation
local currency movement on imported raw materials.
Depreciation and amortisation increased 11% y-o-y to `3,397 crore
5.1.5 EMPLOYEE BENEFITS EXPENSES due to additional depreciation on asset capitalisation for new
projects and normal capex. Accelerated depreciation was charged
2018-19 2017-18 Change Change % on certain assets discarded / to be discarded due to expansion /
Employee 1.400 1,260 140 11% modification / setting up of new facilities.
remuneration
and benefits 5.1.9 EXCEPTIONAL ITEMS
(` in crore)
Employee benefits expenses increased by 11% y-o-y to `1,400
crore, largely due to annual increase in compensation for 2018-19 2017-18 Change Change %
employees and increase in headcount to 12,599 employees at
end-March 2019, from 11,619 employees at end-March 2018. Exceptional items - 234 (234) -100%
5.1.10 TAX EXPENSE Loan and advance increased primarily due to loans provided to
certain overseas subsidiaries for acquisitions, working capital,
Tax expense increased to `3,558 crore in FY 2018-19 from `2,450
capital expenditure and other general corporate purposes.
crore in FY 2017-18 primarily on account of higher tax provisions
due to an increase in profit before tax during the current year. The
5.1.14 OTHER FINANCIAL ASSETS
effective tax rate decreased to 30.11% from 34.63%, primarily due
to the availment of certain tax incentives in FY 2018-19. (` in crore)
Capital 9,577 3,071 6,506 212% Decrease in non current other financial assets is primarily due to
work-in-progress reclassification of certain receivable of subsidiaries to current
Intangible assets 172 65 107 165% other financial assets. Current other financial assets increased
primarily due to non receipt of GST incentive benefits recognised
Intangible assets 344 321 23 7% during the year and previous years.
under development
Other Investments 1,424 1,030 394 38% 2018-19 2017-18 Change Change %
The increase in investments was primarily due to acquisitions Work-in-Progress 476 690 (214) -31%
made during the year. The Company invested `536 crore in Acero Semi Finished/ 3,229 2,826 403 14%
Junction Holding Inc. in June 2018, `399 crore in Creixent Special Finished Goods
Steels Limited for investing in Monnet Ispat and Energy Limited
in August 2018 and `359 crore in its subsidiary Dolvi Mineral and Production 1,919 1,792 127 7%
Metals Private Limited. Consumables and
Stores & Spares
5.1.13 LOANS AND ADVANCES Total 10,599 10,082 517 5%
(` in crore)
The average inventory holding as on 31 March 2019 for finished
2018-19 2017-18 Change Change % goods was unchanged at 20 days. However, overall inventory
holding fell to 66 days for FY 2018-19 from 70 days a year earlier.
Long-term loans 7,674 5,165 2,509 49% Value of inventories increased by 5% due to higher cost of raw
and advances materials like coal and iron ore and spares.
Short-term loans 136 158 (22) -14%
and advances
Current Maturities 9,404 4,099 5,305 129% Return on capital employed was at 21.6% for FY 2018-19.
- Debt
5.1.22 OWN FUNDS
Current Maturities - 417 359 58 16%
Finance Lease Net worth increased from `27,907 crore as on 31 March 2018 to
`35,162 crore as on 31 March 2019.
Sub Total 41,937 36,181 5,756 16%
The book value per share was `145.47 as on 31 March 2019 as
Long-term borrowings (including current maturity of long term against `115.45 as on 31 March 2018.
debt) increased by `2,560 crore mainly due to availment of new
loans for capacity expansion projects. 5.1.23 OTHER KEY FINANCIAL INDICATORS
Notes:
* Increase was primarily on account of increase in steel prices in FY 2018-19 and extended credit due to stressed liquidity conditions
** The increase in Interest Coverage Ratio has improved by 33% primarily due to the increase in EBITDA during the year
^ Change in net profit margin is due to increased profitability in FY 2018-19 driven by stronger steel spreads. The EBITDA increased by `4,662 crore (34% increase).
However, the interest and depreciation charge remained at similar levels as compared to previous year.
# Return on Net worth is higher due to increase in profitability in FY 2018-19 by 79%
5.2 Consolidated 30. JSW Jharkhand Steel Limited 60. JSW Vallabh Tinplate Private Limited
The Company reported consolidated 31. JSW Steel Coated Products Limited 61. Acciaitalia S.p.A. (till 17 April 2018)
revenue from operations, operating
32. Amba River Coke Limited 62. Creixent Special Steel Limited (w.e.f 28
EBITDA and net profit after tax of `84,757
August 2018)
crore, `18,952 crore, and `7,524 crore, 33. Nippon Ispat Singapore (PTE) Limited
respectively. The Company’s consolidated 63. Milloret Steel Limited (w.e.f 28 August
34. Erebus Limited
financial statements include the financial 2018 till 31 August 2018)
performance of the following subsidiaries 35. Arima Holdings Limited
64. Monnet Ispat & Energy Limited (w.e.f 31
and joint ventures.
36. Lakeland Securities Limited August 2018)
2. JSW Steel Italy S.r.l. 39. JSW Industrial Gases Private Limited
5. JSW Steel (USA), Inc. 42. Milloret Steel Limited (till 27 August
2018)
6. Purest Energy, LLC
43. Creixent Special Steels Limited (till 27
7. Meadow Creek Minerals, LLC
August 2018)
8. Hutchinson Minerals, LLC
44. Dolvi Minerals & Metals Private Limited
9. RC Minerals, LLC
45. Dolvi Coke Projects Limited
10. Keenan Minerals, LLC
46. JSW Realty & Infrastructure Private
11. Peace Leasing, LLC Limited
12. Prime Coal, LLC 47. JSW Retail Limited (w.e.f 20 September
2018)
13. Planck Holdings, LLC
48. Acero Junction Holdings, Inc. (w.e.f 13
14. Rolling S Augering, LLC
June 2018)
15. Periama Handling, LLC
49. JSW Steel USA Ohio, Inc. (Previously
16. Lower Hutchinson Minerals, LLC known as Acero Junction Inc.) (w.e.f 13
June 2018)
17. Caretta Minerals, LLC
50. Aferpi S.p.A (w.e.f 24 July 2018)
18. JSW Panama Holdings Corporation
51. Piombino Logistics S.p.A (w.e.f 24 July
19. Inversiones Eroush Limitada
2018)
20. Santa Fe Mining S.A.
52. GSI Lucchini S.p.A (w.e.f 24 July 2018)
21. Santa Fe Puerto S.A.
5.2.2 JOINTLY CONTROLLED
22. JSW Natural Resources Limited
ENTITIES:
23. JSW Natural Resources Mozambique
53. Vijayanagar Minerals Private Limited
Limitada
54. Rohne Coal Company Private Limited
24. JSW ADMS Carvão Limitada
55. Geosteel LLC
25. JSW Steel Processing Centres Limited
56. JSW Severfield Structures Limited
26. JSW Bengal Steel Limited
57. JSW Structural Metal Decking Limited
27. JSW Natural Resources India Limited
58. Gourangdih Coal Limited
28. JSW Energy (Bengal) Limited
59. JSW MI Steel Service Center Private
29. JSW Natural Resources Bengal Limited
Limited
6.0
Energy
management
132
132 JSWSTEEL
JSW STEELLIMITED
LIMITED INTEGRATEDREPORT
INTEGRATED REPORT2018-19
2018-19
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
JSW Steel Energy Policy With a mission to set a benchmark for other steel plants with
regard to carbon footprint reduction and emissions, the Company
JSW Steel strives for global recognition and
is investing in extensive green belt development through tree
excellence by achieving the lowest specific energy
plantation in and around the plants to enable carbon dioxide
consumption and taking proactive steps to combat
sequestration and derive other benefits like dust control and
climate change.
better landscape.
The Company is committed to:
JSW Steel has set up a state-of-the-art Energy Management
• Continuously improving its energy performance
Centre equipped with a supervisory control and data acquisition
through resource optimisation, deployment of
(SCADA) system that gathers all plant site energy information
the latest technologies and cost-effective use of
by remote Programmable Logic Controllers (PLCs) and field
energy.
instruments. A trained team of engineers works continuously
• Driving energy conservation and increasing in shifts to optimise real-time distribution of by-product gases
efficiency of operations through deployment generated during the process, considering production and power
of innovative and reliable processes, which management. The Company has set a goal of ‘Adaptation of global
enable effective reuse, recycle and reduction of best available technologies and lowest SEC by 2025.’
resources.
Further, the Company has deployed an online software which
• Performing beyond compliance with all the
calculates SEC of a plant on a daily basis. This helps in regular
applicable statutory, regulatory and business
monitoring and subsequent reduction of SEC.
requirements.
• Training and engaging with relevant stakeholders
in building responsible behaviours in usage of
6.2 Initiatives for effective energy
energy and facilitating installation of energy management at JSW Steel:
efficient plant, equipment and other resources for
●● To promote energy management best practices and
future expansions
reinforce good energy management behaviours, the
• Harnessing green, clean or renewable energy management implemented ISO 50001.
sources.
●● The energy coordinators have conducted the following
activities:
6.3 Vijayanagar Works ●● Fuel conversion of LCP 1, 2 and 3 from solid fuel (coal) to
by-product gas (BFG+COG) resulting in reduction of heat
Initiatives taken for energy conservation, emissions reduction and
rate lower CO2 emissions.
results achieved:
●● Commissioned 150 TPH Boiler for power augmentation 2018-19 9.7 6.95
●● Reduction in oxygen venting by 36% ●● Highest-ever power generation from waste gases of
36.61 Mw (previous best – 36.51 Mw, FY 2016-17).
Progress of energy consumption reduction at Vijayanagar Works:
Year *SEC, Gcal/Tcs *CO2, TCO2/Tcs 6.5.2 ENERGY SAVINGS INITIATIVES AT SALEM
2016-17 6.260 2.41
WORKS
●● Reduction in fuel rate in BF-1 by increasing Hot Blast
2017-18 6.185 2.40
Temperature after installation of High Temperature Hot
2018-19 6.08 2.31 Blast Stoves.
*As per PMT norms (i.e. excluding CRM, Boiler & CPP; including DRI & CDQ) ●● Optimisation of Air Fuel ratio in BF Hot Blast stoves
through digitalisation initiative to reduce BF gas
consumption.
6.4 Dolvi Works
●● Energy savings by installation of Motor with drive in
6.4.1 ENERGY MANAGEMENT HIGHLIGHTS Hydraulic system in EOF2 .
●● Dolvi Works initiated the usage of Coke Oven Gas in place ●● Installation of variable-voltage/variable-frequency (VVVF)
of Natural Gas (NG) in FY 2018-19 at production of Direct drive in BLM Furnace blowers, Descalar and Internal
Reduced Iron (DRI), Tunnel Furnace, Bar Mill and SMS circulating water pump house motors resulted in energy
ladle preheater. saving.
●● Fuel conversion of HSM Boiler and BF Cast house from NG ●● Energy savings at Sinter Plant-2 through Waste gas ID
to COG leading to NG saving of 672 KSm3. fan impeller replacement with increased bed height
operations.
●● Revamping of CPP turbine, identification and arresting
of leakages resulting in reduction of gaseous heat rate ●● Solid fuel saving at Sinter Plant-2 through installation of
from 2641 Kcal/nm3 in FY 2017-18 to 2400 Kcal/kwh. three row burner with increased bed height operations.
●● Interconnection of HP and LP steam network through ●● Installation of VFD in BF-2 cooling tower fans (8 No’s).
Pressure Reducing and Desuperheating (PRDS) system
to provide steam from Sinter-2 waste heat recovery
boiler to Coke oven resulting in steam production
@20 TPH.
7.0
Procurement
Iron ore and coking coal are the two key raw materials in steel The Company restarted coking coal mining operations in the US in
production, accounting for nearly 64% of the total cost of steel FY 2018-19, after a gap of almost three years, as the rise in coking
production. JSW Steel has launched several strategic initiatives coal prices has made it viable. Though the Company does not plan
to secure the availability and procurement of these two raw to import the coking coal produced in the US to India, this coal
materials. production will provide a financial hedge as it will be sold in the
open market. To reduce import dependency and ensure partial
7.1 Iron Ore security of raw material, JSW Steel engaged in domestic steel
supply initiatives by participating in coal linkage auctions for the
JSW Steel has undertaken a significantly large capacity expansion
non-regulated sectors. It acquired one coal mine in Jharkhand in
project. As capacities grow, the need for iron ore proportionately
FY 2018-19.
increases. To ensure continued iron ore supply with a cost
advantage, the Company has initiated an aggressive backward To ensure that its dependence on premium coking coal is
integration strategy to gain more control over its value chain and optimised with a customised blend of carbon bearing materials of
get direct access to iron ore. The Company has acquired six iron improved quality, the Company continues to leverage its in-house
ore mines in Karnataka. state-of-the-art blend management system. To increase cost
benefits by optimising coal usage, PCI injection has also been
Apart from sourcing from its captive iron ore capacity of 5 MTPA,
undertaken in the units. Such measures have reduced production
the Company also procures from third-party sources, domestic or
costs and coking coal consumption substantially, while improving
international, depending on availability and cost. During FY 2018-
resource efficiency, maintaining smooth operations, and keeping
19, the Vijayanagar and Salem facilities benefited from the captive
costs under check.
iron ore supply while Dolvi Works sourced from Chhattisgarh,
Odisha and through imports.
8.0
Talent
management
JSW Steel invests in its talent pool as much as it does in business The data collected from these surveys was decisive in creating
processes to generate value over time. It involves multiple a grade-wise systematic learning intervention aimed at instilling
facets, from tracking career paths, creating opportunities and leadership skills, enhancing functional skills and building next role
mentoring, to creating an ambient workspace. In FY 2018-19, JSW capabilities.
Steel formulated a ‘people first’ approach in diverse domains
using technical knowhow, data analysis from surveys and a solid
understanding of organisational behaviour.
Training
FY 2018-19, 68 Future Fit Leaders were trained across different development. In partnership with leading business schools, FFLs’
business units within the JSW Group. The programme involves development journey is further sustained by Action Learning
a comprehensive leadership capability development journey Projects and Individual Development Plans (IDPs) specific to their
that includes a structured framework to impart training and next identified role.
1,104 22
Total number of employees in Total number of Band-3 FFLs who
Initial Assessment Process started their leadership development
with Cornell University
196 515
Total number of employees Total number of shortlisted Band-
shortlisted for 1 day in-person 4 and Band-5 employees for
development centres programme
68 46
Total number of Future Fit Leaders Total number of Band-4 and
Band-5 FFLs who begun their
development with the Indian
School of Business
The Diversity and Inclusion Policy for JSW Steel was unveiled in
FY 2018-19. This policy aims to ensure that all those participating
in its workplace are treated with respect, dignity and fairness,
thus creating an environment which promotes positive working
relationships.
HMM Spark: Harvard Managementor Spark (HMM Spark) is a ●● Emotionally and mentally safe place to work.
mobile application intended to provide personalised, best-in-class
●● Improve perception on respect and fairness by building
leadership and management content to employees on-the-go
people manager capability.
Skills 2020: An initiative where Skillsoft courses were categorised
●● Build culture of appreciation through non-monetary
based on the most important skills employees should possess by
recognition.
2020 according to the World Economic Forum
9.0
Digital initiatives
at JSW Steel
Deliver wow by
JSW Steel’s digitally transforming
Digital Vision and nurturing JSW
Steel’s ecosystem,
thereby creating
sustainable value.
In the past two years, the Company has launched over 100
projects in digital across manufacturing, supply chain, sales and
procurement. Its accruals for FY 2018-19 from digital projects
Direct impacts of going digital : was approximately `180 crore. It has also helped improve
Computer vision-aided video analytics is used to governance, boost sales, enhance customer delight and reduce
drive manual process time reduction, enhance discrepancies in forecasting.
throughput and improve productivity of Steel
Using analytics, robotics and hybrid cloud, JSW Steel is aligning
Melting Shops (SMS).
business processes to dynamic sectoral and economic realities.
Big data and analytics driven real time models The Company leverages the SAP platform enabling smooth
used to reduce power consumption and associated data collation, decision making, and data security. The year in
losses. review witnessed several such levers to innovate, enhance and
strengthen business operations, using information technology
(IT) and digital platforms.
10
Risk
management
JSW Steel follows the globally recognised ‘COSO’ framework Requirements) Regulations, 2015 and Clause 49 of the erstwhile
of Enterprise Risk Management. ERM brings together the Listing Agreement, the Company has constituted a sub-
understanding of the potential upside and downside of all those committee of Directors to oversee Enterprise Risk Management
factors which can affect the organisation with an objective to framework to ensure resilience such that:
maximise sustainable value to all the activities of the organisation
●● Intended risks, say growth, are taken prudently so as to
and to its stakeholders.
plan for the best and be prepared for the worst.
The Company recognises that the emerging and identified risks
●● Execution of decided strategies and plan with focus on
need to be managed and mitigated, in order to:
action.
●● protect its shareholders and other stakeholders’
●● Unintended risks like performance, incident, process and
interests.
transaction risks are avoided, mitigated, transferred (like
●● achieve its business objective. in insurance) or shared (like through sub-contracting).
The probability or impact thereof is reduced through
●● enable sustainable growth.
tactical and executive management, policies, processes,
Pursuant to the requirement of Regulation 21 of the Securities inbuilt systems controls, MIS, internal audit reviews etc.
and Exchange Board of India (Listing Obligations and Disclosure
Strategic
3) Unfair trade practices 3) Broadening product range like CRM, auto grade etc.
resulting into surge in
4) Increased Value added products like galvanised,
imports
galvalume.
4) Trade barriers imposed
5) Strong retail footprint leveraging the network of
by other countries like US,
distributors and dealers and branded products to
Europe.
focus on retail sales.
Marketing Increasing competition post 1) In India Steel output is expected to increase marginally
the recent consolidation in as against the steel demand growth @ 7-8%.
steel industry driven by IBC
2) Expanding market share and customer retention by
process
focusing on:
Strategic
Raw material High cost of iron ore 1) Successfully participated in auction of iron ore mines
impacting the EBITDA. and bagged leasing rights for 6 mines
availability (approx 5 MTPA capacity in Karnataka state).
Availability and cost of
and cost – required grade of Iron ore are 2) Focusing on the captive mines for the requirements
Iron ore impacted by: through participation of iron ore auctions in Karnataka
and Odisha.
1) Global movement and
parity of landed cost 3) Exploring iron ore from international sources. The
considering price, freight, imported iron ore on value-in-use basis has certain
tariff and exchange rates. productivity gains and to a large extent offsets the
difference in price.
2) Domestic demand-supply
gap, constraints and 3) Government policies and their impact on ore
vendor actions availability are being tracked regularly.
3) Government policies on
mining, allocation and
tariff - NMDC stopped
mining at Donimalai (which
contributes to 10% of the
requirements) due to
substantial increase in
lease rent by GOI.
Risk of production stoppage 1) Buying on Annual Rate Contract where price is linked to
Raw material due to non- availability of TSI and PLATTS index.
availability & coking coal for the capacity
2) The Company plans to ensure availability of coking coal
expansion at Dolvi and other
cost – locations since JSW Steel is
and minimise the impact of rising price by diversifying
the sources across various geographies.
Coking coal solely dependent on import.
b) no additional capacities
are being added globally
constraining the supply
side and demand from India
continues to increase.
Strategic
Exchange Foreign currency - rupee 1) The Company has an advantage of natural economic
depreciation against US$ from hedge as domestic prices of steel are linked with
rate `65 to `74 during the year. international steel prices.
fluctuation Such volatility may increase
2) The Company has a robust hedging policy approved
the cost of the imported raw
by Board.
material and increase the dollar
denominated borrowings. 3) For Exports – continue to hedge entire exports
through forwards.
Risk of high borrowing cost 1) The Company has divided its Foreign Currency
Interest impacting the profitability. Loan (FCL) in fixed and floating interest rate in an
rate Globally there is increasing
appropriate ratio.
trend of the interest rate - 2) In order to mitigate the risk of increasing interest rate,
the Company has hedged its floating rate FCL through
Fed raised the key rate in the
Interest Rate Swap (IRS).
range of 2% to 2.25%.
Return On Capital Employed 2) M&A team has access to data room of the target.
(ROCE). It will also have
3) Carry out due diligence that mainly includes Finance,
adverse impact on debt
Tax and Legal aspects. This helps to identify risks and
and interest serving.
plan strategies for mitigations.
2) Challenges in turnaround
4) Finance model designed taking input from Strategy,
and scale up. Delay may
Business Development and then the M&A team decide
drag the profitability.
the capital structure.
3) Old litigation may dent the
5) Overall leverage ratios to be within targeted threshold
JSW brand and reputation.
levels of 3.75 x Net debt / EBITDA and 1.75 x Net debt /
Equity.
Operational
1) Port congestion, unloading 4) Higher capacity barges (RSV – River Sea vessels)
/ loading infrastructure, rail being procured for transportation of inbound raw
connectivity and channel material and outbound finished goods. This will also
blockage. reduce pressure on road movement.
Availability Company’s proposed expansion 1) The power required would be met partly through
at Dolvi would increase the self-generation from Coke oven / Blast Furnace gases
of power for power requirement. Inadequate and balance from JSW Energy, Ratnagiri and MSEDCL
production power supply and network through open access.
bandwidth may lead to
2) In order to have network bandwidth, 200 KV additional
operational interruptions and
transmission line of 20 kms is planned from Nagothane
affect production.
to Plant.
1) Steel making process 1) The Company ensures compliance with norms through
Environment involves emission of CO2, selecting right equipment, technology, processes,
dust and other hazardous inputs and tracks emissions. Additional capex
gases / waste (slag). allocation for advanced technologies like Electrostatic
These emissions pose Precipitators (ESPs) in sinter to further reduce the dust
risk to environment and emissions.
sustainable growth.
2) The Company regularly tracks changes in technology
2) India is also a part of Paris and future norms to plan in advance. In discussion with
agreement (COP 21) which vendor for processing of additional LD slag that would
aims at reducing carbon be generated after proposed expansions at Vijayanagar
emissions. and Dolvi.
Operational
Health Any safety lapses would result 1) Compliance with local and international regualtions and
in damage to property, assets standards, protecting the employees and communities
and safety and human capital. The steel from harm and operations from business interuptions
sector is subject to extensive are the primary focus.
health and safety laws,
2) International consultant DuPont has been engaged for
regulations and standards
rolling out their international safety standards.
Human Human workforce with required 1) Senior leadership support helps in setting the tone at
skillset and experience is the top.
resource critical for maintaining current
2) For building strong relationships, a platform called
level of operations and
Candid Conversation launched that enables greater
upcoming expansions at plants.
interaction between employees and senior leaders.
Operational
Cyber Cyber security risk could result The Company de-risks by:
in substantial reputation and
security financial loss arising from: 1) Periodically assessing the current state and prioritise
the foundational components of cyber security.
1) Theft of corporate
information 2) Conducting periodic audits of security systems and
procedures.
2) Theft of financial information
(e.g. Financial results, bank 3) Developing a new capability, technologies and
details etc.) processes to combat cyber-threats.
Certain statements in this release concerning our future growth prospects are forward-looking statements, which involve a number of
risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks
and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings,
JSW Steel’s ability to manage growth, intense competition within Steel Industry including those factors which may affect the Company’s
cost advantage, wage increases in India, its ability to attract and retain highly skilled professionals, time and cost overruns on fixed-
price, fixed-time frame contracts, client concentration, restrictions on immigration, its ability to manage internal operations, reduced
demand for steel, ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the
success of the companies in which – has made strategic investments, withdrawal of fiscal governmental incentives, political instability,
legal restrictions on raising capital or acquiring companies outside India, unauthorised use of the Company’s intellectual property and
general economic conditions affecting our industry. The Company does not undertake to update any forward-looking statements that
may be made from time to time by or on behalf of the Company.
DIRECTORS’ REPORT
To the Members of
1. FINANCIAL RESULT
(` in crores)
Standalone Consolidated
FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18
I Revenue from operations 76,727 67,723 84,757 73,211
II Other income 519 213 204 167
III Total income (I+II) 77,246 67,936 84,961 73,378
IV Expenses:
Cost of materials consumed 39,589 35,995 43,476 38,779
Purchases of stock-in-trade 498 1,063 320 2
Changes in inventories of finished goods, work-in-progress (188) 412 (590) 244
and stock-in-trade
Employee benefits expense 1,400 1,260 2,489 1,843
Finance costs 3,708 3,591 3,917 3,701
Depreciation and amortization expense 3,397 3,054 4,041 3,387
Excise duty expense - 1,259 - 1,278
Other expenses 17,025 13,993 20,110 16,271
Total expenses 65,429 60,627 73,763 65,505
V Profit before share of profit/(loss) of joint ventures (net) and 7,309 7,873
11,817 11,198
exceptional items (III-IV)
VI Share of profit/(loss) of joint ventures (net) - - (30) 42
VII Profit before exceptional items and tax (V+VI) 11,817 7,309 11,168 7,915
VIII Exceptional items - 234 - 264
IX Profit before tax (VII-VIII) 11,817 7,075 11,168 7,651
X Tax expense/(benefit):
Current tax 2,348 1,578 2,473 1,826
Deferred tax 1,210 872 1,171 (288)
3,558 2,450 3,644 1,538
XI Net Profit for the year (IX- X) 8,259 4,625 7,524 6,113
XII Other comprehensive income
A i) Items that will not be reclassified to profit or loss
a) Re-measurements of the defined benefit plans (15) (3) (19) (5)
b) Equity instruments through Other Comprehensive Income 4 82 (2) 92
ii) Income tax relating to items that will not be reclassified 5 1 7 2
to profit or loss
Total (A) (6) 80 (14) 89
(` in crores)
Standalone Consolidated
FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18
B i) Items that will be reclassified to profit or loss
a) The effective portion of gains and loss on hedging instruments 31 (341) 85 (401)
b) Changes in Foreign Currency Monetary Item Translation Difference (49) (33) (49) (33)
account (FCMITDA)
c) Foreign currency translation reserve (FCTR) - - (60) 9
ii) Income tax relating to items that will be reclassified to profit or loss 6 130 (12) 150
Total (B) (12) (244) (36) (275)
Total Other comprehensive income / (loss) (A+B) (18) (164) (50) (186)
XIII Total comprehensive income (XI+ XII) 8,241 4,461 7,474 5,927
Total Profit /(loss) for the year attributable to:
- Owners of the company 7,639 6,214
- Non-controlling interests (115) (101)
7,524 6,113
Other comprehensive income/(loss) for the year attributable to:
- Owners of the company (24) (184)
- Non-controlling interests (26) (2)
(50) (186)
Total comprehensive income/(loss) for the year attributable to:
- Owners of the company 7,615 6,030
- Non-controlling interests (141) (103)
7,474 5,927
The Company has adopted Indian Accounting demand grew by 2.1% in CY18, largely driven by China, coupled
Standard (referred to as ‘Ind AS’) with effect from with an investment-led recovery in the advanced economies.
1 April, 2016 and accordingly these financial results along with
Cash flows and profitability in FY 2018-19 was driven by
the comparatives have been prepared in accordance with
stronger steel spreads, as the increase in finished steel
the recognition and measurement principles stated therein,
products prices was higher than the increased price of
prescribed under Section 133 of the Companies Act, 2013 (“Act”)
principal raw materials like Iron ore and Coking Coal.
read with the relevant Rules framed thereunder and the other
accounting principles generally accepted in India. On the domestic front, India became the world’s second
largest steel producer with a crude steel production of 106.5
2. RESULTS OF OPERATIONS million tonnes. In the first half of FY 2018-19, the demand
The year 2018 started on an optimistic note driven by strong for steel remained positive owing to continued government
economic activity and policy level interventions. In the first spending on infrastructure. Towards the last two quarters,
half of the year, economic growth remained robust backed by activities surrounding the national election led to restrained
fiscal stimulus and resilient Emerging Markets. However, the investment activity. However, the demand for steel during
second half of the year was marked by volatility, weakening FY 2018-19 sustained a growth of 7.5%. Steel imports increased
demand caused by trade tensions, China’s slowdown and by 4.7% specifically in coated products. However, steel exports
tightening financial conditions. from India reduced by 26.4% due to subdued international
demand and various trade measures. In this competitive
In 2018, global crude steel production reached 1,808.60 environment, the Company continued to increase the market
million tonnes, up 4.6% from 2017 levels. The upsurge in share in the domestic market by strategically focusing
production was majorly driven by China, with its share in on increasing domestic sales volume, which witnessed a
global crude steel production increasing from 50.3% in 2017 growth of 11% YoY mainly driven by OEM segment. Sales of
to 51.3% in 2018. value added and special products (VASP) accounted for 53%
For the Steel industry, the year began with a strong of total sales volumes.
underlying demand and rising international prices, which This robust domestic demand, strong operational performance
resulted in higher spreads and improved profitability. focused cost reduction, backward integration and healthy mix
However, towards the second half, on-going trade disputes of value added portfolio helped the Company deliver strong
between US and China and slowdown across some of the operational and profitable performance and consequently the
developed economies, led to softening of the prices and Company’s profitability improved during FY 2018-19.
demand for steel globally. Despite the headwinds, global steel
(a) Standalone Results The consolidated performance for the year includes
The Company delivered its highest ever production the acquired assets of Acero Junction Holdings, Inc.
volumes, sales volume, EBITDA and profit after tax during along with its wholly owned subsidiary JSW Steel USA
the FY 2018-19. Ohio Inc. and Aferpi S.p.A, Piombino Logistics S.p.A
and GSI Lucchini S.p.A from the respective date of
The Company achieved highest ever crude steel their acquisition.
production for the year at 16.69 million tonnes, a growth
of 3% YoY as the capacity utilisation levels improved to The Company’s net worth increased to `34,345 crores
93%. Saleable steel sales volume for the year grew by 1% as on 31 March, 2019 as compared to `27,534 crores as
YoY to 15.76 million tonnes, driven by domestic sales. on 31 March, 2018. The Company’s gearing (Net Debt to
Equity) at the end of the year stood at 1.20x (as against
Revenue from operations for FY 2018-19 stood at 1.38x as on 31 March, 2018) and Net Debt to EBITDA stood
` 76,727 crores, up 13% YoY. This revenue was mainly at 2.17x (as against 2.57x as on 31 March, 2018).
driven by higher average realisations on the back of
improved price realisations. The Company continued to In terms of Section 134(3) (l) of the Companies Act, 2013,
improve its market share as domestic sales surged to except as disclosed elsewhere in this Report, no material
13.9 million tonnes in FY 2018-19, an increase of 10% YoY changes or commitments affecting the financial position
compared to 7.5% YoY increase in Indian steel demand. of the Company have occurred between the end of the
financial year and the date of this Report.
In the last fiscal, the Company strategically focused on
reducing costs by working on the following areas as a 3. TRANSFER TO RESERVES
part of its continuous improvement journey:
The Board of Directors has decided to retain the entire
––
Commissioning of Coke oven battery at Dolvi to amount of profits in the profit and loss account, except
eliminate procurement of coke for an amount of `144 Crores, which has been transferred
to the Debenture Redemption Reserve as required
–– Increase PCI injection to reduce fuel consumption
under the Companies Act 2013.
–– Operationalised three iron ore mines and use of
captive iron ore, thereby reducing dependency on 4. DIVIDEND
imported iron ore The Board of Directors of the Company has approved a
––
Diversifying the coal procurement basket and Dividend Distribution Policy on 31 January, 2017 in accordance
optimising coal cost by dynamic coal blends with the Securities and Exchange Board of India (Listing
Obligations & Disclosure Requirements) Regulations, 2015.
––
Reducing logistics cost by port optimisation and The Policy is available on the Company’s website: www.jsw.
usage of Cape vessels to reduce freight costs in/investors/investor-relations-steel.
The Company progressed well on these performance In terms of the Policy, Equity Shareholders of the Company may
improvement initiatives and the operating EBITDA expect Dividend if the Company has surplus funds and after
for the year grew by 34% YoY to `18,403 crores. taking into consideration relevant internal and external factors
Consequently, the Company registered a net profit enumerated in the policy for declaration of dividend. The policy
growth of 79% YoY at `8,259 crores for FY 2018-19 as also enumerates that efforts will be made to maintain a
compared to the net profit of `4,625 crores for FY 2017-18. dividend payout (including dividend distribution tax and
The Company’s net worth increased to `35,162 crores dividend on preference shares, if any) in the range of 15% to
as on 31 March, 2019 as compared to `27,907 crores as 20% of the consolidated net profits of the Company after tax,
on 31 March, 2018. The Company’s gearing (Net Debt to in any financial year, subject to compliance of covenants with
Equity) at the end of the year stood at 1.03x (as against Lenders / Bond holders.
1.27x as on 31 March, 2018) and Net Debt to EBITDA stood In line with the said policy, the Board has, subject to the
at 1.97x (as against 2.59x as on 31 March, 2018). approval of the Members at the ensuing Annual General
Meeting, recommended dividend at the stipulated rate of
(b) Consolidated Results
0.01% per share on the 48,54,14,604; 0.01% Cumulative
Revenue from operations on a consolidated basis for Redeemable Preference Shares (proportionately considering
FY 2018-19 stood at `84,757 crores. The operating EBITDA four instalments of redemption) (` 0.000790411 per share) for
stood at `18,952 crores, registering an increase of 28% the year ended 31 March, 2019.
YoY. The Company reported a net profit growth of 23%
YoY at `7,524 crores for FY 2018-19 as compared to the The Board had also, in its meeting held on 25 October, 2018
net profit of `6,113 crores for FY 2017-18. approved the payment of dividend due on the Company’s
10% Cumulative Redeemable Preference Shares of `10 each,
The performance and financial position of the subsidiary for the FY 2018 – 19 upto the date of its redemption on 15
companies and joint arrangements are included in September, 2018.
the consolidated financial statement of the Company.
The Board considering the Company’s performance and the 7 to 8 %, steel consumption is expected to remain strong.
financial position for the year under review, also recommended The current high capacity utilisation, consolidation of players
payment of dividend at `4.10 per equity share on the in flat segment and expected robust domestic demand
241,72,20,440 equity shares of `1 each for the year ended 31 augurs well for the steel industry. Government of India has
March, 2019, subject to the approval of the Members at the declared a New Steel Policy to increase steel production
ensuing Annual General Meeting. Together with Corporate Tax capacity to about 300 MTPA steel by 2030, considering the
on dividend, the total outflow, on account of equity dividend, per capita consumption increasing to 160 kgs and elasticity
will be `1,195 crores, vis-à-vis `933 crores paid for FY 2017–18. of steel demand at 1.14 upto 2020 and thereafter at 1.
3) Capacity expansion of CRM-1 complex from 0.85 MTPA to The projects are planned to be funded by a mix of debt
1.80 MTPA at Vijayanagar and internal accruals.
1) Setting up of 8 MTPA pellet plant and 1.5 MTPA coke • A Tailing Beneficiation plant which helps reduce tailing
oven plant at Vijayanagar: losses and improves iron content in the feed to Pellet
With a view to reduce its dependency on the expensive and Sinter plants.
lump iron ore, the Company has decided to set up an
• Additional Coal Injection system and relining of Stove
8 MTPA pellet plant at Vijayanagar. The Company has
#4 part of Blast Furnace-3 has helped reduce fuel
also decided to set up a 1.5 MTPA coke oven plant at
consumption substantially.
Vijayanagar to bridge the current and expected gaps in
the coke availability. Both these projects are expected II. Projects under implementation
to provide significant cost savings and are likely to be
•
Downhill conveyors from newly acquired mines up
commissioned by March 2020.
to the Ore yard and remaining segments of pipe
2) Phase-2 coke oven plant of 1.5 MTPA under Dolvi Coke conveyor system, to ensure improved connectivity
Projects Limited (DCPL): and seamless transport of raw material.
The Company through DCPL will be setting up a second
• Coke drying unit at Blast Furnace-1 to reduce coke
line of 1.5 MTPA coke oven plant along with CDQ facilities
moisture utilising waste heat from Sinter Plant-1.
to cater to the additional coke requirement for the crude
steel capacity expansion to 10 MTPA at Dolvi. This project • A new Cut to Length (CTL) line to meet demand of sized
is expected to be commissioned by June 2020. steel products.
• Debottlenecking of BP-2 to enable handling of 50,000 of the Company along with relevant documents and separate
tpd of low grade Iron Ore. audited accounts in respect of subsidiaries are available on
the website of the Company. The Company would provide the
DOLVI
annual accounts of the subsidiaries and the related detailed
I. Projects commissioned during FY 2017-18 information to the shareholders of the Company on specific
• 1.5 MTPA coke oven plant at Dolvi by Dolvi Coke Projects request made to it in this regard by the shareholders.
Limited eliminating the procurement of high cost coke.
The details of major subsidiaries and JVs are given below:
•
Commissioning of LCP Fuel Conversion resulting
in considerable reduction of emission level A. INDIAN SUBSIDIARIES
and cost savings. 1. JSW STEEL COATED PRODUCTS LIMITED (JSW STEEL COATED)
•
Digitalisation initiatives to reduce set up time for JSW Steel Coated Products Limited is the Company’s
processes and thus improve productivity at SMS. wholly-owned subsidiary. It has three manufacturing
facilities in the State of Maharashtra at Vasind, Tarapur
II. Projects under implementation and Kalmeshwar. It is engaged in the manufacture of
The steelmaking capacity at Dolvi Works will be increased value-added flat steel products comprising of Galvanised
from existing 5 MTPA to 10 MTPA. and Galvalume Coils/Sheets and Colour-Coated Coils/
Sheets. This Company caters to both domestic and
SALEM
international markets. JSW Steel Coated reported
I. Projects commissioned during FY 2018-19 a production (Galvanising/Galvalume products) of
• Third Billet grinding machine to improve surface finish 1.74 million tonnes, an increase by 3% YoY. The sales
of billets for Cold head quality and free cutting steels. volume decreased by 13% YoY to 1.79 million tonnes
during FY 2018-19.
•
BF 1 Stove upgradation to improve Hot Blast
Temperature to reduce fuel consumption. The revenue from operations for the year under review
was `12,324 crores. The operating EBITDA during
• Sinter Plant II capacity augmentation to increase
FY 2018-19 was `393 crores as compared to the EBITDA
agglomerated burden in blast furnace to reduce
of `638 crores in FY 2017-18. The operating EBITDA
dependency on lump iron ore.
margin during FY 2018-19 was 3% as compared to 5%
II. Projects Under Implementation in FY 2017-18 primarily due to increase in raw material
cost and conversion costs. The net profit after tax stood
• Conveyor system for handling of raw materials from
at `80 crores, compared to net profit after tax of `275
Wagon tippler.
crores in FY 2017-18.
• Advanced MPI Inspection facilities with Grinding
station at Line 04. KEY NEW PROJECTS
• Liquid Oxygen Backup system for emergency supply Tin Plate Mill
of oxygen to SMS and oxygen facility for increasing During the year, JSW Steel Coated has installed and
oxygen enrichment in Blast furnace. commissioned a Tin Plate Mill of 0.25 MTPA and related
facilities at its Tarapur Work to cater to the increasing
8. SUBSIDIARY and JOINT VENTURE (JV) COMPANIES demand for the tin plate. The total project cost incurred
The Company had fifty direct and indirect subsidiaries and ten is `575 crores.
JVs as on 31 March, 2019. The Company has acquired certain Considering the potential growth in demand, it is decided
overseas subsidiaries and domestic joint ventures during the to set up another Tin Plate Mill with capacity of 0.25 MTPA
year. Further, JSW Retail Limited was incorporated as a wholly at an estimated cost of `419 crores.
owned subsidiary by the Company during the year with an
objective to achieve retail focus and increase the retail steel Modernisation and Capacity Enhancement at Vasind &
sales to improve profitability. Other than these, there has Tarapur by 1.5 MTPA by setting up PLTCM
been no material change in the nature of the business of Additions/modifications will be carried out at Vasind
the subsidiaries. and Tarapur for net capacity enhancement of cold rolling
As per the provisions of Section 129(3) of the Act, a statement by 1 MTPA and other downstream facilities. The project
containing the salient features of the financial statements cost is estimated at `1,729 crores and is expected to be
of the Company’s subsidiaries (which include associate commissioned in FY 2019-20.
companies and JVs) in Form AOC-1 is attached to the financial
Colour coated products capacity expansion
statements of the Company.
Considering the market trends and broad demand
As per the provisions of Section 136 of the Act, the standalone outlook, the Company has strategically decided to
financial statements and consolidated financial statements increase the capacity of its colour coated products
with an investment of around `1,180 crores in Rajpura, 6. DOLVI MINERAL & METALS PRIVATE LIMITED (DMMPL) AND
Kalmeshwar and Vasind. ITS SUBSIDIARY DOLVI COKE PROJECTS LIMITED (DCPL)
The Company was holding 39.996% stake in Dolvi
Ne w CRCA capacity
Minerals & Metals Private Limited (DMMPL). On 23
JSW Steel Coated has also decided to set up a 0.5 October, 2018, the Company acquired the shareholding of
MTPA Cold Rolled Close Annealed (CRCA) capacity at other shareholders of DMMPL aggregating to 60.004% for
Vasind. This will strengthen the Company offering to the a consideration of `109 crores to make DMMPL a wholly
automotive and white goods sector. owned subsidiary of the Company. Dolvi Coke Projects
Limited (DCPL) is a wholly-owned subsidiary of DMMPL.
2. AMBA RIVER COKE LIMITED (ARCL)
Amba River Coke Limited (ARCL) is a wholly-owned DCPL has set up a 1.5 million tonnes per annum Coke
subsidiary of the Company. ARCL has set up a 1 MTPA Oven Plant (Phase-1) at Dolvi. The coke produced is
coke oven plant and a 4 MTPA pellet plant. ARCL has being supplied to the Dolvi unit and Vijayanagar unit
produced 1.05 million tonnes of coke and 4.02 million of the Company.
tonnes of pellet during FY 2018-19. The coke and
DCPL has also commenced setting up of Phase II
pellets produced are primarily supplied to the Dolvi unit comprising of a 1.5 MTPA coke oven plant and 2x190
of the Company. The operating EBITDA during FY 2018-19 TPH Coke Dry Quenching (CDQ) unit at an estimated cost
was `434 crores as compared to the EBITDA of `431 of `2,133 crores and is expected to be commissioned
crores in FY 2017-18. The profit after tax increased during FY 2019-20.
to `176 crores in FY 2018-19 as compared to `169
crores in FY 2017-18. 7. OTHER MATERIAL PROJECTS TO BE UNDERTAKEN BY DO-
MESTIC SUBSIDIARIES
3. JSW STEEL (SALAV) LIMITED (JSW SALAV)
The Company had announced a few greenfield projects
JSW Salav is a wholly-owned subsidiary in the states of West Bengal, Jharkhand and Odisha.
of the Company. JSW Salav has a DRI plant with a capacity The Company is not certain when they will become
of 0.9 MTPA, along with a captive jetty and railway sliding. fully operational:
During FY 2018-19, the unit has produced 0.68 MnT, an •
JSW Bengal Steel Limited (“JSW Bengal Steel”)
increase of 2% as compared to FY 2017-18. The profit after - As a part of the Company’s overall growth
tax for FY 2018-19 was `38 crores as compared to `35 strategy, the Company had planned to set up a 10 mtpa
crores in FY 2017-18. capacity steel plant in phases through its subsidiary
JSW Bengal Steel. However, due to uncertainties in the
4. JSW STEEL PROCESSING CENTRES LIMITED (JSWSPCL)
availability of key raw materials such as iron ore and
JSW Steel Processing Centres Limited (JSWSPCL) is the coal after the cancellation of the allotted coal blocks,
Company’s wholly-owned subsidiary. JSWSPCL was the implementation of the JSW Bengal Steel Salboni
set up as a steel service centre, comprising HR/ CR project is currently put on hold.
slitter and cut-to-length facility, with an annual slitting
capacity of 6.5 lakh tonnes. The Company processed •
JSW Jharkhand Steel Limited (JJSL)- JJSL was
5.64 lakh tonnes of steel during FY 2018-19, compared to incorporated in relation to the setting up of a 10
previous year’s 5.68 lakh tonnes. JSWSPCL registered a million tonnes steel plant in Jharkhand. The Company
profit after tax for FY 2018-19 of `23 crores as compared is currently in the process of obtaining the various
to `21 crores in FY 2017-18. approvals and clearances for the project.
undertaken in a phased manner and is expected to be Profit after tax for FY 2018-19 was `61 crores, compared
operational during fiscal year 2021. It includes revamping to `76 crores in FY 2017-18.
of the existing plate mill in the first phase and setting
up a melt and manufacture steel making facility in 2. JSW SEVERFIELD STRUCTURES LIMITED AND ITS SUBSIDI-
the second phase. ARY JSW STRUCTURAL METAL DECKING LIMITED
JSW Severfield Structures Limited (JSSL) is operating
During FY 2018-19, the US plate and pipe mill’s operating
a facility to design, fabricate and erect structural steel
performance improved as compared to FY 2017-18 with
work and ancillaries for construction projects.
better capacity utilisation. This unit produced 0.33 million
net tonnes of plates and 0.07 million net tonnes of pipes These projects have a total capacity of 55,000 TPA
with capacity utilisation of 35 % and 13 %, respectively. at Bellary, Karnataka. JSSL produced 67,886 tonnes
(including job work) during FY 2018-19. Its order book
During FY 2018-19, JSW Steel (USA) generated EBITDA
stood at `1,338 crores (119,310 tonnes), as on 31
of USD 26.09 million compared to EBITDA of USD 13.22
March, 2019 and EBITDA in FY 2018-19 increased to `63
million in FY 2017-18. The increase was mainly attributable
crores from `51 crores in FY 2017-18. The profit after
to higher sales volume of plate product.
tax for FY 2018-19 was `28 crores, as compared to `11
Net loss after tax for FY 2018-19 was `363 crores crores in FY 2017-18.
compared to net profit after tax of `652 crores in
JSW Structural Metal Decking Limited (JSWSMD),
FY 2017-18. During FY 2017-18, tax expenses was lower
a subsidiary company of JSSL, is engaged in the
primarily due to a reversal of deferred tax liabilities
business of designing and roll forming of structural
pursuant to the enactment of Tax Cuts and Jobs Act by
metal decking and accessories such as edge trims and
the United States on 22 December, 2017, as the corporate
shear studs. The plant’s total capacity is 10,000 TPA.
income tax rate for entities of the Group based in the
EBITDA in FY 2018-19 increased to `5 crores from `2
United States was reduced to 21 per cent and recognition
crores in FY 2017-18. The profit after tax for FY 2018-19
of deferred tax asset on the unused tax losses to the
was `2 crores, compared to `0.1 crore in FY 2017-18.
extent the components had sufficient taxable temporary
differences in the view of improved operational 3. JSW MI STEEL SERVICE CENTRE PRIVATE LIMITED (MISI JV)
performance of components based in the United States.
JSW Steel Limited and Marubeni-Itochu Steel signed a JV
b) Coal mining operation agreement on 23 September, 2011 to set up steel service
centres in India.
Periama Holdings LLC has 100% equity interest in coal
mining concessions in West Virginia, US along with The JV Company had started the commercial operation
permits for coal mining; Periama also owns a 500 TPH of its steel service centre in western India (near Pune),
coal-handling and preparation plant. with 0.18 MTPA initial installed capacity in March 2015.
During the year, MISI JV has also commissioned its steel
During the year, the coal-mining operations ramped up
service centre in Palwal, Haryana, with 0.18 MTPA initial
and the total production stood at 84,743 NT.
capacity. The service centre is equipped to process
During FY 2018-19, the coal mining operations generated flat steel products, such as hot-rolled, cold-rolled and
EBITDA of USD 5.44 million compared to negative EBITDA coated products. Such products offer just-in-time
of USD 0.02 million in FY 2017-18. solutions to automotive, white goods, construction and
other value-added segments.
Loss after tax of coal mining operations for FY 2018-19
was `116 crores, compared to net profit after tax of `81 EBITDA in FY 2018-19 increased to `24 crores from `15
crores in FY 2017-18. crores in FY 2017-18. MISI JV earned a profit after tax
of `12 crores during FY 2018-19, similar to profit of `12
C. JOINT VENTURE COMPANIES Crores and FY 2017-18.
1. GEO STEEL LLC
4. JSW VALLABH TINPLATE PRIVATE LIMITED (JSWVTPL)
Geo Steel LLC (Geo Steel) is a Georgia-based JV, in
The Company holds 50% stake in JSWVTPL, which is into
which the Company holds 49% equity through JSW Steel
tin plate business and has a capacity of 1.0 lakh tonnes.
(Netherlands) B.V. Geo Steel has set up a steel rolling mill
JSWVTPL produced 0.90 lakh tonnes during FY 2018-19.
in Georgia, with 1.75 lakh tonnes production capacity.
EBITDA in FY 2018-19 was `23 crores as compared to `26
Geo Steel produced 1.16 lakh tonnes of rebars and 1.13
crores in FY 2017-18. Net loss after tax for FY 2018-19 was
lakh tonnes of billets during FY 2018-19.
`4 crores against a net loss of `2 crores in FY 2017-18.
EBITDA in FY 2018-19 decreased by 23% to USD 12.83
million from USD 16.65 million in FY 2017-18 primarily due D. MERGER OF WHOLLY-OWNED SUBSIDIARIES
to decrease in sales volume by 24%. The Board of Directors of the Company at its meeting held
on 25 October, 2018 considered and approved the Scheme
of Amalgamation pursuant to sections 230 - 232 and 2. Acero Junction Holdings, Inc (Acero) And Its Wholly
other applicable provisions of the Companies Act, 2013, Owned Subsidiary JSW Steel USA Ohio Inc (JSWSUO)
providing for the merger of its wholly owned subsidiaries, (Previously Known as Acero Junction, Inc)
Dolvi Minerals and Metals Private Limited (DMMPL), Dolvi On 28 March, 2018, the Company entered into a stock
Coke Projects Limited (DCPL), JSW Steel Processing purchase agreement with JSM International Limited,
Centres Limited (JSWSPCL), and JSW Steel (Salav) Limited Acero Junction Holdings Inc. and Acero Junction Inc.
(JSW Salav) with the Company. The merger is subject to for acquisition of 100% shares of Delaware-based steel
regulatory approvals. manufacturer, Acero Junction Holdings Inc. for a cash
The application for the merger filed with the National consideration of USD 80.85 million.
Company Law Tribunal (NCLT) by the Company, DMMPL, On 15 June 2018, the Company completed the acquisition
DCPL and JSWSPCL has been admitted by NCLT. The next of Acero along with its wholly owned subsidiary JSWSUO.
date of hearing at NCLT, Mumbai is scheduled on 6th JSWSUO has steelmaking assets consisting of 1.5 MTPA
June, 2019. The application for merger filed with NCLT, electric arc furnace (EAF), 2.8 MTPA continuous slab
Ahmedabad in relation to JSW Salav is yet to come caster and a 3.0 MTPA hot strip mill at Mingo Junction,
up for hearing. Ohio in USA. The Company expects that the acquisition
will allow it to gain increased access to the North
E. ACQUISITION DURING THE YEAR
American steel market.
1 Monnet Ispat & Energy Limited (MIEL)
The Company is proposing a two-phased expansion
In July, 2018, the National Company Law Tribunal, and modernization plan for JSWSUO. The first phase
Mumbai Bench approved the resolution plan of revamping and restarting the existing EAF was
submitted by the consortium of the Company and completed in December 2018. On completion of this
AION Investments Private II Limited (a wholly-owned capital expenditure, JSWSUO has become a 1.5 MTPA
subsidiary of AION Capital Partners Limited) (“AION”, and fully integrated steel making facility, with HSM rolling
together with the Company, the “Consortium”) for MIEL. capacity upto 3 MTPA. In the second phase and subject
The acquisition of MIEL was completed bythe Consortium on to economic viability, prevailing economic conditions
31 August, 2018. and subject to necessary approvals, the possibility of
The Consortium members and its affiliates directly or adding another EAF as well as additional manufacturing
indirectly hold equity shares amounting to approximately equipment at the hot strip mill to make the Ohio facility
74.33% of the paid-up equity share capital of MIEL. a fully integrated unit with 3.0 mtpa capacity will be
The effective holding of the Company in equity shares considered at an expected cost of USD 250 million.
of MIEL is ~23.10%. In addition, Consortium also holds From the date of acquisition, Acero has posted a negative
Compulsorily Convertible Preference Shares aggregating EBITDA of USD 41.62 million and net loss after tax of USD
to `526 crores in MIEL. In addition to the above 45.74 million.
investments, the Company has provided `125 crores as
a working capital advance to MIEL. MIEL has steel plants 3. Aferpi S.p.A (AFERPI), Piombino Logistics S.p.A (PL) and
in the state of Chhattisgarh with Blast furnace and DRI GSI Lucchini S.p.A (GSI)
facility of 1.5 MTPA. The Company through its wholly owned subsidiary in
Post-acquisition of management control, operations Italy, JSW Steel Italy S.r.l., on 24 July, 2018, completed
of Raigarh Pellet plant was started in October 2018 and the acquisition of 100% shares each of Aferpi, S.p.A.
production was ramped up to around 90% of installed (Aferpi) and Piombino Logistics S.p.A. (PL) and 69.27%
capacity. In the month of February 2019, MIEL started the shares of GSI Lucchini S.p.A (GSI), (jointly referred to
integrated steel production through blast furnace (for iron as Targets) from Cevitaly S.r.l (“Cevitaly”), a company
making), electric arc furnace (steel making), ladle refining, organized under the laws of Italy, for a cash consideration
continuous casting and bar mill rolling. The iron making of Euro 55 Million on a cash free, debt free basis and
and steel making operations are under stabilisation. additional consideration on account of net working
Further MIEL is investing in equipment upgradations capital of the respective Targets on the date of closing
with the objective of producing value added steel (long) the transaction.
products for applications in automobile sector, energy, Aferpi produces and distributes special long steel
railways and general engineering. With this MIEL is products, viz. rails, wire rods and bars. They have a plant
expected to enter into the value added market by the end at Piombino in Italy, comprising a Rail Mill (0.32 mtpa),
of current financial year. Bar Mill (0.4 mtpa), Wire Rod Mill (0.6 mtpa) and a captive
industrial port concession.
GSI is a producer of forged steel balls used in grinding finally approved the resolution plan vide its order dated
mills with predominant application in mining processing. 16 April, 2019. The Company filed an appeal challenging the
GSI facilities are located within the premises of Piombino said NCLT Order before NCLAT, in which an interim order was
plant, providing easy access to export markets through passed on 30 April, 2019 suggesting that the Resolution
the port of Piombino. Plan as approved by the Committee of Creditors may be
implemented. The Company has further filed an Appeal before
The acquisition provides a unique opportunity
the Hon’ble Supreme Court against the interim order of NCLAT
for the Company to establish its presence in Italy and get
in which the Hon’ble Supreme Court vide an order dated 10
access to the European speciality steel long products market.
May, 2019 has ordered status quo and also requested the
The acquisition will also provide a foothold for the Company for
Hon’ble NCLAT to take up the matter on 28 May, 2019 and
exploring future opportunities in the European markets.
dispose it off.
From the date of acquisition, Aferpi, PL and GSI collectively
VIL is a listed company which manufactures colour coated
posted a negative EBITDA of Euro 17.30 million and net loss
products. VIL has its manufacturing unit at Rajpura District,
after tax of Euro 15.32 million.
Patiala in Punjab. VIL has a colour coating capacity of 40,000
tonnes per annum and a small service centre to cater to white
9. COMPANY’s PARTICIPATION IN IBC PROCESS
goods customers in North India. VIL also own 23.5% of equity
Bhushan Power and Steel Limited (BPSL) of JSW Vallabh Tinplate Private Limited.
BPSL was referred to National Company Law Tribunal
(NCLT) for commencement of Corporate Insolvency and 10. TECHNICAL COLLABORATION WITH JFE STEEL
Resolution Process (CIRP) on 26 July, 2017. The Company has CORPORATION, JAPAN (JFE)
submitted its resolution plan for BPSL under the CIRP under The technical collaboration between JFE Steel Corporation,
the Insolvency and Bankruptcy Code, 2016. The Company’s Japan (JFE) and JSW Steel Limited which commenced in 2010
ability to submit a revised resolution plan for BPSL was entered its 9th successful year in FY 2018-19.
challenged before the National Company Law Appellate
The strategic technical collaboration with JFE Steel has
Tribunal (NCLAT). However, by its order dated 4 February,
added significant value to the Company, both in terms
2019, the NCLAT struck down the challenge. Further, on
of products and services, thereby enriching the product
13 February, 2019, the Company accepted a Letter of Intent
mix of the Company. The Company has developed a wide
issued by the Committee of Creditors of BPSL. The completion
range of steel for critical auto end use applications such
of a potential acquisition of BPSL by the Company is subject
as outer body panels, bumper beams and other crash
to obtaining the necessary approval from the NCLT and
resistant components with strength levels up to 980 MPA.
satisfaction of conditions precedent under the resolution
The continuous support received from JFE in the form of
plan. As of the date of this report, hearings in respect of the
technical assistance has resulted in expeditious resolution
NCLT’s approval is completed and judgment on the same is
of issues observed during commercial production/approval of
reserved by NCLT.
stipulated licensed grades.
The closure of the transaction is subject to obtaining necessary
The collaboration with JFE has immensly helped your
regulatory approvals which are currently in progress.
company in imbibing the technological best pratices.
Founded in 1970 and based in New Delhi, India, BPSL is a It has further created a culture of continous learning and
fully integrated steel making company with an installed process improvements, which ensure medium to long-term
capacity of 3.5 MTPA. It manufactures and markets flat and value creation.
long products and owns plants at Chandigarh, Kolkata and
Even in the auto and electrical steel sales, JFE’s experience
Odisha in India. These plants manufacture products covering
and understanding has been successfully leveraged to
entire steel value chain, from manufacturing pig iron, sponge
gain customer satisfaction. This has helped the Company to
iron, billets, hot rolled coils, cold rolled coils, galvanized
consolidate its leadership position in the supplies of value
sheets, precision tubes, black pipe, cable tapes, carbon
added products into the ever demanding segments of
and special alloy steel wire rods and rounds conforming to
automotive and electrical steel.
IS and international standards. BPSL serves agriculture and
irrigation, fire-fighting/HVAC, construction, gas/oil pipe lines, Our strategic collaboration with JFE Steel has added significant
cement/sugar/paper, automobiles, white goods, bicycles, value to the Company – in terms of products and customers
steel/power projects, and general engineering industries. and relationship shared between the two organisations at all
levels has been exemplary.
Vardhman Industries Limited (VIL):
VIL was referred to the NCLT, Delhi Bench under the corporate 11. RISK MANAGEMENT
insolvency and resolution process of the Insolvency and
The Company has developed and implemented a Risk
Bankruptcy Code 2016. The Company had submitted its Management Policy and follows the globally recognised
resolution plan which was approved by the committee of ‘COSO’ framework of Enterprise Risk Management (ERM).
creditors of VIL on 10 August, 2018. The Hon’ble NCLT, Delhi
ERM brings together the understanding of the potential and outbound finished goods, improving infrastructure
upside and downside of all those factors which can affect facilities at Dharamtar jetty and additional storage yards
the organisation with an objective to add maximum for iron ore fines & coal are constructed to handle the
sustainable value to all the activities of the organisation & to enhanced volumes.
various stakeholders.
•
Technology and operational disruptions – effective
The Company recognises that the emerging and identified management of automation systems, spares management,
risks need to be managed and mitigated to: maintenance scheduling, R & D infrastructure and insurance
cover for plant interruptions and loss of profit.
• protect its shareholder’s and other stakeholder’s interests.
• Environment, health and safety – compliance with norms
• achieve its business objective.
through the right selection of equipment, technologies,
• enable sustainable growth. processes, inputs and tracking emissions; additional capital
expenditure allocation for advanced technologies like
Pursuant to the requirement of Regulation 21 of
Electrostatic Precipitators (ESPs) in sinter to further reduce
the Securities and Exchange Board of India (Listing
the dust emissions; developing sustainable products
Obligations and Disclosure Requirements) Regulations,
which are safe for consumers; preserving bio-diversity in
2015, the Company has constituted a sub-committee
eco-sensitive area; tracking changing technology and future
of Directors to oversee the Enterprise Risk Management
norms for advance planning; rolling out international safety
framework to ensure resilience such that -
standards, safety training and providing medical facilities
• Intended risks are taken prudently so as to plan for the best and Mediclaim policy cover for employees and their families.
and be prepared for the worst.
• Manpower availability with desired skill-sets – manpower
•
Execution of decided strategies and plan with planning in line with growth strategy, on-the-job / online
focus on action. trainings to develop competencies and soft skills and
leadership programmes to develop future fit leaders.
• Unintended risks like performance, incident, process and
transaction risks are avoided, mitigated, transferred (like •
Reputation – value-driven leadership; adhering to the
in insurance) or shared (like through sub-contracting). highest standards of governance and code of conduct,
The probability or impact thereof is reduced through tactical extending even to business partners.
and executive management, policies, processes, inbuilt
•
Finance - proactive tracking of funding and covenants,
systems controls, MIS, internal audit reviews etc.
regular review of hedging strategy, close monitoring
• The Company believes that the overall risk exposure of of plant operations, cost optimisation, inventory,
present and future risks remains within risk capacity. receivables and payables.
•
Deployment of an ERP system that covers most of Internal financial controls
its operations and is supported by a defined on-line
As per Section 134(5)(e) of the Companies Act 2013,
authorisation protocol. the Directors have an overall responsibility for ensuring
•
Ensuring complete compliance with laws, regulations, that the Company has implemented a robust system and
standards and internal procedures and systems. framework of internal financial controls. This provides the
Directors with reasonable assurance regarding the adequacy
• De-risking the Company’s assets/ resources and protecting and operating effectiveness of controls with regards to
them from any loss. reporting, operational and compliance risks. The Company
• Ensuring the integrity of the accounting system and a proper has devised appropriate systems and framework, including
and authorised recording and reporting of all transactions. proper delegation of authority, policies and procedures;
effective IT systems aligned to business requirements;
•
Preparation and monitoring of annual budgets for all risk-based internal audits; risk management framework and
operating and service functions. a whistle blower mechanism.
• Ensuring a reliabilityof all financial and operational information.
The Company had already developed and implemented
• Audit Committee of Board of Directors, comprises majority a framework for ensuring internal controls over financial
of Independent Directors. The Audit Committee regularly reporting. This framework includes entity-level policies,
reviews audit plans, significant audit findings, adequacy processes and Standard Operating Procedures (SOP).
of internal controls and compliance with Accounting The entity-level policies include antifraud policies (such
Standards, etc. as code of conduct, conflict of interest, confidentiality and
• A comprehensive Information Security Policy and continuous whistle blower policy) and other polices (such as organisation
updation of IT systems. structure, insider trading policy, HR policy, IT security policy,
treasury policy and business continuity and disaster recovery
The internal control systems and procedures are designed plan). The Company has also prepared SOP for each of its
to assist in the identification and management of risks, the processes such as procure to pay, order to cash, hire to
procedure-led verification of all compliances as well as an retire, treasury, fixed assets, inventory, manufacturing
enhanced control consciousness. operations, etc.
Internal audit During the year, controls were tested and no reportable
The Company has an internal audit function that inculcates material weakness in design and effectiveness was observed.
global best standards and practices of international majors
into the Indian operations. The Company has a strong 13. CREDIT RATING
internal audit department reporting to the Audit Committee During the year, Moody’s Investors Service has maintained
comprising majority of Independent Directors who are the Corporate Family Rating and Senior Unsecured Bond
experts in their fields. The Company successfully integrated Rating due in 2019, 2022 and 2024, respectively, to Ba2 while
the COSO framework in its audit process to enhance the changing the outlook to positive from stable.
quality of its financial reporting, compatible with business
Also, Fitch Ratings retained the Company’s long-term Issuer
ethics, effective controls and governance.
Default Rating (IDR) and Senior Unsecured Bond rating due
The Company extensively practices delegation of authority in 2019, 2022 and 2024, respectively, to BB, maintaining the
across its team, which creates effective checks and balances outlook at stable.
within the system to arrest all possible gaps. The internal
The domestic credit rating for long-term debt/ facilities/
audit team has access to all information in the organisation
Non-Convertible Debentures (NCDs) by Credit Analysis and
– this is largely facilitated by ERP implementation across
Research Ltd (CARE) and ICRA were upgraded to AA from AA-,
the organisation.
while the short-term debt/ facilities continues to be rated at
Audit plan and execution the highest level of A1+. CARE and ICRA has assigned a stable
outlook on the long-term rating. India Ratings has upgraded
The Internal Audit function has prepared a risk-based audit
a long-term issuer rating and rating for the outstanding
plan. The frequency of the audit is decided by risk ratings
NCDs of the Company to AA from AA- while maintaining the
of areas/functions. The audit plan is carried out by the
outlook at stable.
internal team and reviewed periodically to include areas
that have assumed significant importance in line with
14. FIXED DEPOSITS
the emerging industry trend and the aggressive growth
of the Company. In addition, the audit committee also places The Company has not accepted any fixed deposits from the
reliance on internal customer feedback and other external public. Therefore, it is not required to furnish information
events for inclusion into the audit plan. in respect of outstanding deposits under Non-banking,
Non-financial Companies (Reserve Bank) Directions, 1966 and
Companies (Accounts) Rules, 2014.
15. SHARE CAPITAL plans for future growth secured by committed exports of
The Company’s Authorised Share capital during the financial steel products to DSA.
year ended 31 March, 2019 remained at `9015,00,00,000
(Rupees Nine Thousand Fifteen crores only) consisting 18. ISSUANCE OF NON-CONVERTIBLE DEBENTURES
of `6015,00,00,000 (Rupees Six Thousand Fifteen crores In a meeting held on 25 July, 2018, the Board of Directors
only) equity shares of `1/- (Rupee One only) each and of the Company approved issue of secured and unsecured
300,00,00,000 (Three Hundred crores) preference shares of redeemable non-convertible debentures on private
`10/- (Rupees Ten only) each. placement basis and/or public issue for an amount of up
to `10,000 crores in one or more tranches in the domestic
The Company’s paid-up equity share capital remained
market. The specified use of proceeds includes replacement
at `241,72,20,440 comprising of 241,72,20,440 equity
of short-term loans, long-term working capital, normal/
shares of `1 each.
approved capital expenditure, reimbursement of capital
During the financial year, the Company has fully redeemed expenditure already incurred and/or general corporate
the balance amount of its 27,90,34,907, 10% cumulative purposes. The Board authorised the finance committee to
redeemable preference shares of `10 each fully paid up, in finalise the terms of issue.
two equal instalments of `2.5 per share on 15 June, 2018 and
15 September, 2018. 19. CORPORATE GOVERNANCE
Further, the Company also partially redeemed its 48,54,14,604, The Company constantly endeavours to follow the corporate
0.01% cumulative redeemable preference shares of `10 each governance guidelines and best practices sincerely and
fully paid up, in four equal instalments of `1.25 per share on disclose the same transparently. The Board is conscious of
15 June, 2018, 15 September, 2018, 15 December, 2018 and its inherent responsibility to disclose timely and accurate
15 March, 2019. information on the Company’s operations, performance,
material corporate events as well as on the leadership and
Thereby, the aggregate preference share capital as at governance matters relating to the Company.
the financial year ended 31 March, 2019 is `242,70,73,020
comprising of 48,54,14,604, 0.01% cumulative redeemable Your Company has complied with the requirements of the
preference shares of `5 each fully paid up. Securities And Exchange Board Of India (Listing Obligation
and Disclosure Requirements) Regulations, 2015 regarding
16. FOREIGN CURRENCY BONDS (FCBS) corporate governance. A report on the Corporate Governance
practices and the Auditors’ Certificate on compliance of
During FY 2014-15, the Company had allotted 2,500, 4.75%
mandatory requirements thereof are given as an annexure to
Fixed Rate Senior Unsecured Notes of USD 2,00,000 each
this report and also available on the website of the company at
of the Company due 2019, aggregating to USD 500 million,
https://www.jsw.in/investors/investor-relations-steel.
to eligible investors. In April 2017, the Company further
allotted 2,500, 5.25% Fixed Rate Senior Unsecured Notes of
20.MANAGEMENT DISCUSSION & ANALYSIS
USD 2,00,000 each of the Company due 2022 aggregating
to USD 500 million, to eligible investors. These Notes issued A detailed report on the Management Discussion & Analysis is
by the Company in the International Market are listed on the provided as a separate section in the Annual Report.
Singapore Exchange Securities Trading Limited (the “SGX-ST”).
21. BUSINESS RESPONSIBILITY / SUSTAINABILITY
Further, in April 2019, the Company has issued 5.95% REPORTING
Fixed Rate Senior Unsecured Notes of USD 2,00,000 each
The Company is committed to pursuing its business
of the Company, aggregating to USD 500 million, due 2024.
objectives ethically, transparently and with accountability to
The Notes are listed on the Singapore Exchange Securities
all its stakeholders. The Company believes in demonstrating
Trading Limited (SGX- ST).
responsible behaviour while adding value to the society
and the community, as well as ensuring environmental
17. ADVANCE PAYMENT AND SUPPLY AGREEMENT WITH
well-being with a long-term perspective.
DUFERCO S.A.
The Company entered into a five-year Advance Payment
The Business Responsibility Report (BRR)
and Supply Agreement (the “APSA”) agreement on 27 of the Company was being presented to the stakeholders
February, 2019 with Duferco S.A. (“DSA”) for the export of as per the requirements of Regulation 34 of the Securities
steel products. Under the terms of the APSA, DSA, as the and Exchange Board of India (Listing Obligations and
purchaser, has provided an interest-bearing advance Disclosure Requirements) Regulations 2015 describing
amount of USD 700 million. This unique financing structure the environmental, social and governance initiatives taken
provides the Company long term funding to complement its by the Company. Further, SEBI in their circular dated 6 February,
2017, has advised the top 500 listed companies (by market Mrs. Nirupama Rao is given in the notice convening the 25th
capitalisation) to voluntarilyadopt Integrated Reporting (IR) from Annual General Meeting , for the perusal of the shareholders.
FY 2017-18.
Pursuant to the recommendation of Nomination and
As stated earlier in the report, the current financial year marks Remuneration Committee, the Board of Directors at its
the second year of the Company transition towards Integrated meeting held on 24 May, 2019, has subject to the approval of
Reporting, focussing on the ‘capitals approach’ of value the members at the forthcoming 25th Annual General Meeting
creation.The Company’s second Integrated Report, includes the of the Company scheduled on 25 July, 2019, approved the
Company’s performance as per the IR framework for the period re-appointment of Mr. Jayant Acharya (DIN 00106543), as a
1 April, 2018 to 31 March, 2019. Whole-time Director of the Company, designated as ‘Director
(Commercial and Marketing)’, for a period of five years, with
The Company was awarded the “Highly Commended” award
effect from 7 May, 2019.
for its maiden IR FY 2017-18 in Asia Sustainability Reporting
awards. The Company was ranked second globally at The proposals regarding the re-appointment of the aforesaid
Steel Sustainability Champions Award 2018 by WorldSteel. Directors are placed for your approval.
JSW Steel Limited was the only steel company selected
Changes in the Board of Directors of your Company, during
as one of ‘India’s Super 50 Companies’ (Forbes, Super50
the year under review, are as follows:
Companies 2018). JSW Steel, Vijayanagar was awarded the
coveted Deming Prize in 2018. Karnataka State Industrial Infrastructure and Development
Corporation Limited (KSIIDC) had nominated Mrs. Gunjan Kinnu,
The Company has adopted an integrated approach towards
IAS (DIN 08184500) as its nominee on yourCompany’s Board with
addressing biological diversity at various sites. The Company
effect from 25 July 2018 in place of Mr. Narasimhaiah Jayaram,
was among the pioneers to sign up and commit to the Indian
IAS (DIN 03302626), whose nomination was withdrawn w.e.f.
Business and Biodiversity Initiative (IBBI), an initiative by the
19 July, 2018. KSIIDC subsequently withdrew the nomination
Confederation of Indian Industry (CII) in partnership with India’s
of Mrs. Gunjan Kinnu, IAS w.e.f. 08 May, 2019 and nominated,
Ministry of Environment, Forest & Climate Change. Million Tree
Mr. Gangaram Baderiya, IAS. (DIN No.07507633) as its nominee
Plantation Project has been initiated in nearby degraded
on your Company’s Board with effect from 24 May, 2019.
forest areas at Dolvi and Karav in a vision to achieve 1 million
Tree plantation, in collaboration with forest department. Your Directors place on record their deep appreciation of the
valuable services rendered by Mr. Narasimhaiah Jayaram, IAS
The Company has also provided the requisite mapping of
and Mrs. Gunjan Kinnu, IAS during their tenure on the Board
principles of the National Voluntary Guidelines to fulfill the
of the Company.
requirements of the Business Responsibility Report as per
directive of SEBI, as well as between the Integrated Report and There were no changes in the Key Managerial Personnel
the Global Reporting Initiative (‘GRI’). The Report, along with all of the Company during the year under review.
the related policies, can be viewed on the Company’s website
(http://www.jsw.in/investors/investor-relations-steel). POLICY ON DIRECTORS’ APPOINTMENT AND
REMUNERATION
22. DIRECTORS AND KEY MANAGERIAL PERSONNEL Matching the needs of the Company and enhancing the
In accordance with the provisions of Section 152 competencies of the Board are the basis for the Nomination
of the Companies Act, 2013 and in terms of the Articles and Remuneration Committee to select a candidate for
of Association of the Company, Mr. Jayant Acharya (DIN appointment to the Board.
00106543) retires by rotation at the forthcoming Annual The current policy is to have a balanced mix of executive
General Meeting and, being eligible, offers himself for and non-executive Independent Directors to maintain the
re-appointment. independence of the Board and separate its functions of
Mr. Harsh Charandas Mariwala (DIN 00210342) and governance and management. As at 31 March, 2019 the
Mrs. Nirupama Rao (DIN 06954879) who were appointed as Board of Directors comprises 12 Directors, of which eight are
Additional Directors, in the category of Independent Director, non-executive, including three women directors. The number
by the Board of Directors with effect from 25 July, 2018, in of Independent Directors is six, which is one half of the total
terms of Section 161 of the Companies Act, 2013 and in terms number of Directors.
of Article 123 of your Company’s Articles of Association, hold The policy of the Company on directors’ appointment, including
office untill the date of the ensuing Annual General Meeting. criteria for determining qualifications, positive attributes,
Your Company has received a notice under Section 160 independence of a director and other matters, as required
of the Companies Act, 2013 from two shareholders of your under sub-section (3) of Section 178 of the Companies Act,
Company, proposing the names of Mr.Harsh Charandas Mariwala 2013, is governed by the Nomination Policy. The remuneration
and Mrs. Nirupama Rao for appointment as Directors of your paid to the directors is in accordance with the remuneration
Company. A brief profile of Mr. Harsh Charandas Mariwala and policy of the Company.
More details on the Company’s policy on director’s reimbursement of actual travel and out-of-pocket expenses.
appointment and remuneration and other matters provided in The remuneration is subject to the ratification of the Members
Section 178(3) of the Act has been disclosed in the Corporate in terms of Section 148 read with Rule 14 of the Companies
Governance Report, which forms a part of this report. (Audit and Auditors) Rules, 2014 and is accordingly placed for
your ratification. The due date for filing the Cost Audit Report
23.DECLARATION BY INDEPENDENT DIRECTORS of the Company for the financial year ended 31 March, 2018
The Company has received necessary declaration from was 30 September, 2018 and the Cost Audit Report was filed
each of the Independent Directors under Section 149(7) in XBRL mode on 21 August, 2018.
of the Companies Act, 2013, that he/she meets the
SECRETARIAL AUDITOR
criteria of independence laid down in Section 149(6)
of the Companies Act, 2013 and Regulation 25 of the
Pursuant to the provisions of Section 204
Securities and Exchange Board of India (Listing Obligations of the Companies Act, 2013 and the Companies (Appointment
and Disclosure Requirements) Regulations, 2015. and Remuneration of Managerial Personnel) Rules,
2014, the Company had appointed M/s. S. Srinivasan & Co.,
24. BOARD EVALUATION a firm of Company Secretaries in Practice, to undertake
the Secretarial Audit of the Company. The Report of the
The Board carried out an annual performance evaluation of
Secretarial Audit is annexed herewith as Annexure ‘C’.
its own performance, the performance of the Independent
The report does not contain any observation or qualification
Directors individually as well as the evaluation of the working
requiring explanation or comments from the Board under
of the Committees of the Board. The performance evaluation
Section 134(3) of the Companies Act, 2013.
of all the Directors was carried out by the Nomination and
Remuneration Committee. The performance evaluation of the During the period under review, the Company has complied
Chairman and the Non-Independent Directors was carried out with the applicable Secretarial Standards notified by the
by the Independent Directors. Details of the same are given in Institute of Company Secretaries of India.
the Report on Corporate Governance annexed hereto.
The Company has also undertaken an audit for the FY 2018-19
pursuant to SEBI Circular No. CIR/CFD/CMO/I/27/2019 dated
25. AUDITORS AND AUDITORS’ REPORT
08th February 2019 for all applicable compliances as per the
STATUTORY AUDITORS Securities and Exchange Board of India Regulations and
At the Company’s 23rd AGM held on 29 June, 2017, M/s S R B Circular/Guidelines issued thereunder. The Report (Annual
C & CO LLP (324982E/E300003), Chartered Accountants, has Secretarial Compliance Report) has been submitted to the
been appointed as the Statutory Auditor of the Company for Stock Exchanges within 60 days of the end of the financial
a term of 5 years to hold office from the conclusion of the year ended 31 March, 2019.
23rd Annual General Meeting until the conclusion of the 28th As per the provisions of Regulation 24A of the Securities and
Annual General Meeting of the Company. Exchange Board of India (Listing Obligations and Disclosure
The Notes on financial statements referred to in the Auditors’ Requirements) Regulations, 2015, M/s. Vanita Sawant &
Report are self-explanatory and do not call for any further Associates, Practicing Company Secretaries, had undertaken
comments. The Auditors’ Report does not contain any secretarial audit of the Company’s material subsidiary i.e., JSW
qualification, reservation, adverse remark, or disclaimer. Steel Coated for the FY 2018–19. The Audit Report confirms
that the material subsidiary has complied with the provisions
No fraud has been reported by the Auditors under section of the Act, Rules, Regulations and Guidelines and that there
143(12) of the Companies Act, 2013 requiring disclosure in the were no deviations or non-compliances.
Board’s Report.
The Board, at its meeting held on 24 May 2019, has re-appointed
COST AUDITORS M/s. S. Srinivasan & Co., as Secretarial Auditor, for conducting
Pursuant to Section 148(1) of the Companies Act, 2013 your Secretarial Audit of the Company for FY 2019–20.
Company is required to maintain cost records as specified by
the Central Government and accordingly such accounts and 26. RELATED PARTY TRANSACTIONS
records are made and maintained. All Related Party Transactions (RPT) that were entered into
during the financial year were on an arm’s length basis and in
Pursuant to Section 148(2) of the Companies Act, 2013
the ordinary course of business.
read with the Companies (Cost Records and Audit)
Amendment Rules, 2014, your Company is also required to The Company has put up a proposal for your approval by way of
get its cost accounting records audited by a Cost Auditor. an ordinary resolution at the ensuing Annual General Meeting
Accordingly, the Board, at its meeting held on 24 May, 2019 has to be held on 25 July, 2019 for RPT with JSW International
on the recommendation of the Audit Committee, re-appointed Tradecorp Pte Limited (JITPL) aggregating to USD 9,265
M/s. Shome & Banerjee, Cost Accountants to conduct the audit million over a period of 36 months starting from 1 April, 2019,
of the cost accounting records of the Company for FY 2019–20 being considered material RPT in terms of the Securities and
on a remuneration of `17 Lakhs plus taxes as applicable and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations 2015, for procuring iron ore, Accordingly, 1,59,44,271 options have been granted over
coking coal, coke and other raw materials. The total value of a period of three years under this plan by the JSWSL ESOP
raw materials purchased from JITPL during FY 2018-19 was Committee to the eligible employees of the Company and
`16,038 crores. its Indian Subsidiaries, including the Whole-time Directors
of the Company. The details of the ESOPs granted to
The policy on dealing with RPT as approved by
Mr. Seshagiri Rao M.V.S, Dr. Vinod Nowal and Mr. Jayant Acharya,
the Board is uploaded on the Company’s website
Whole-time Directors of the Company is as given in the
(https://www.jsw.in/investors/investor-relations-steel).
table below. The grant of ESOPs to the Whole-time Directors
The policy intends to ensure that proper reporting, approval
of the Company has been approved by the Nomination and
and disclosure processes are in place for all transactions
Remuneration Committee and the Board.
between the Company and Related Parties. This policy
specifically deals with the review and approval of RPT, keeping Options Granted to Whole-time
in mind the potential or actual conflicts of interest that may JSWSL ESOP Total Directors of the Company
arise because of entering into these transactions. All RPT are Committee options Mr.
Dr. Vinod Mr. Jayant
Meeting granted Seshagiri
placed before the Audit Committee for review and approval. Rao M.V.S
Nowal Acharya
Prior omnibus approval is obtained for RPT that are of repetitive 17 May 7,436,850 192,680 179,830 179,830
nature and / or entered in the ordinary course of business 2016 (1st Grant)
and are at arm’s length. All RPT are subjected to independent 16 May 5,118,977 127,968 127,968 119,436
review by a reputed accounting firm to establish compliance 2017 (2nd Grant)
with the requirements of RPT under the Companies Act, 2013 15 May 3,388,444 87,841 87,841 81,985
and Regulation 23 of the Securities and Exchange Board 2018 (3rd Grant)
of India (Listing Obligation and Disclosure Requirements) Total : 15,944,271 408,489 395,639 381,251
Regulations, 2015.
As per the ESOP Plan, 50% of these options will vest at the
The disclosure of material RPT is required to be made end of the third year and the balance 50% at the end of
under Section 134(3)(h) read with Section 188(2) the fourth year.
of the Companies Act, 2013 in Form AOC 2. Accordingly, RPTs
The applicable disclosures relating to ESOP plan of 2016, as
that individually or taken together with previous transactions
stipulated under the ESOP Regulations, pertaining to the year
during a financial year, that exceed 10% of the annual
ended 31 March, 2019, is posted on the Company’s website
consolidated turnover as per the last audited financial
at http://www.jsw.in/investors/investor-relations-steel and
statements, which were entered into during the year by your
forms a part of this Report.
Company, is given in Annexure E to this Report.
Voting rights on the shares, if any, as may be issued
Your Directors draw your attention to Note No 8 to the
to employees under the aforesaid ESOP Plans are to be
Abridged Standalone financial statements and Note No 44 to
exercised by them directly or through their appointed
the Standalone financial statements, which set out related
proxy, hence, the disclosure stipulated under Section 67(3)
party disclosures.
of the Companies Act, 2013 is not applicable.
27. EMPLOYEE STOCK OPTION PLAN (ESOP) There is no material change in the aforesaid ESOP Plans and
The Board of Directors of the Company, at its meeting held the same are in compliance with the ESOP Regulations.
on 29 January, 2016, formulated the JSWSL Employees Stock
The Certificate from the Statutory Auditors
Ownership Plan – 2016 (ESOP Plan), to be implemented of the Company certifying that the Company’s Stock Option
through the JSW Steel Employees Welfare Trust (Trust), with Plans are being implemented in accordance with the ESOP
an objective of enabling the Company to attract and retain Regulations and the resolution passed by the Members,
talented human resources by offering them the opportunity to would be placed at the AGM for inspection by Members.
acquire a continuing equity interest in the Company, which will
reflect their efforts in building the growth and the profitability JSWSL EMPLOYEES SAMRUDDHI PLAN 2019
of the Company. The ESOP Plan involves acquisition of shares The JSWSL Employees Samruddhi Plan 2019 (“Plan”) was
from the secondary market. approved by a special resolution passed by the shareholders
A total of 2,86,87,000 (Two Crores Eighty-Six Lakhs of the Company by way of a postal ballot on 17 May, 2019.
Eighty-Seven Thousand) options were available for grant to The Plan will be effective from 1 April, 2019. The scheme is a
the eligible employees of the Company and its Director(s), one-time scheme applicable only for permanent employees
excluding independent directors, and a total of 31,63,000 of the Company, working in India (excluding an employee
(Thirty-One Lakh Sixty-Three Thousand) options were available who is a promoter or a person belonging to the promoter
for grant to the eligible employees of the Indian Subsidiaries group, a probationer and a trainee) in the grade L01 to L15
of the Company and their Director(s), excluding independent (“Eligible Employee”), who were not covered under the
directors, under the ESOP Plan. earlier JSWSL Employees Stock Ownership Plan – 2016.
The Indian Subsidiary companies have a similar scheme to
• Installation of Dry Fog system in Blast Furnace and wagon the Forest Department by FY 2021-22, around 26,555 saplings
tippler reduced the fugitive dust emission which leads to have been planted in the last fiscal.
improvement in ambient air quality.
In Dolvi, the Company has planted large number of saplings
•
In Dolvi, dust emissions during the material handling in the plant premises and has undertaken focused efforts to
has reduced after the replacement and modification of develop a green belt by maintaining the full-fledged nursery.
the ducts of Dust Extraction (DE) System in Sinter Plant During the year, total number of big trees and shrubs/small
Proportionating House. trees is over 2 lakhs and 5 lakhs respectively.
DOLVI c)
Proper and sufficient care has been taken for the
maintenance of adequate accounting records, in
1) Platinum level recognition in CII Exim Bank Award for
accordance with the provisions of the Companies Act,
Business Excellence 2018.
2013 for safeguarding the assets of the Company and for
2) PM’s Trophy 2016-17: Maximum Incremental Improvement preventing and detecting fraud and other irregularities.
award for Integrated Steel Plant.
d) The annual financial statements have been prepared on
3)
In “Frost & Sullivan – PERP 2018” Digitalisation team a Going Concern Basis.
was Winner & Six Sigma Project team from CSP Mill
e) Internal financial controls were laid down to be followed
were 2nd runner up.
and that such internal financial controls were adequate
4) 2 QCC teams from Bar Mill & Coke Oven won Gold award in and operating effectively.
ICQC, Singapore.
f)
Proper systems were devised to ensure compliance
5) Out of 12 Teams, 8 teams won “Par Excellence” award with the provisions of all applicable laws and that such
in NCQC, Gwalior. systems were adequate and operating effectively.
6) Six Sigma team from CSP Mill won second position in 12th
32. DISCLOSURES
CII National Level Competition at Bangalore.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
SALEM
During the year, four Board Meetings were convened and held,
1)
State Level Health and Safety Award 2016: Won the details of which are given in the Corporate Governance
Commendation Certification from National Safety Council. Report. The intervening gap between the Meetings was
2) IIM Sustainability Award: Won the first prize in the alloy within the period prescribed under the Companies Act, 2013
steel category by the Indian Institute of Metals. and Regulations 17 of the Securities and Exchange Board
of India (Listing Obligation and Disclosures Requirements)
3) Swachh Bharat initiatives: Won Commendation Regulation, 2015.
Certificate from Salem District Collector.
AUDIT COMMITTEE
4) Customer Awards
The Audit Committee comprises of one Executive Director and
a. FAG Schaeffler has awarded JSW Salem for “Best three Non-Executive Independent Directors. Mr. Seturaman
Development Support”. Mahalingam is the Chairman of the Audit Committee.
b.
TIMKEN has awarded JSW Salem for “Strategic The Members possess adequate knowledge of Accounts,
Partner 2018” & “Excellence in Corporate Citizenship Audit, Finance, etc. The composition of the Audit Committee
and Sustainability”. meets the requirements of Section 177 of the Companies Act,
2013 and Regulation 18 of the Securities and Exchange Board
c.
JTEKT has awarded JSW Salem for of India (Listing Obligation and Disclosure Requirements)
“Supplier Performance”. Regulations, 2015.
d. Automotive Axles Ltd has awarded JSW Salem for There are no recommendations of the Audit Committee that
class performance in “Best in Agility” for Rolled Bar have not been accepted by the Board.
supplies in 2017-18.
EXTRACT OF ANNUAL RETURN
31. DIRECTORS’ RESPONSIBILITY STATEMENT The extract of annual return in Form MGT 9 as required under
Pursuant to the requirements under Section 134, sub-section Section 92(3) of the Companies Act, 2013 and Rule 12 of the
3(c) and sub-section 5 of the Companies Act, 2013, the Board Companies (Management and Administration) Rules, 2014
of Directors, to the best of their knowledge and ability, state is attached as Annexure B hereto and forms a part of this
and confirm that: Report. The same is also available on the Company’s website
at http://www.jsw.in/investors/investor-relations-steel.
a) In the preparation of the annual accounts, the applicable
Accounting Standards have been followed, along with
proper explanation relating to material departures.
WHISTLE BLOWER POLICY / VIGIL MECHANISM of the Company on all working days of the Company, between
The Company has a vigil mechanism named Whistle Blower 10.00 a.m. and 1.00 p.m.; or by requesting a physical copy by
Policy / Vigil Mechanism to deal with instances of fraud and writing to the Company Secretary.
mismanagement, if any. Details of the same are given in the
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF
Corporate Governance Report.
WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
PARTICULARS OF LOANS, GUARANTEES OR AND REDRESSAL) ACT, 2013
INVESTMENTS UNDER SEC. 186 The Company has in place an Anti-Sexual Harassment Policy
Details of Loans, Guarantees and Investments covered under in line with the requirements of the Sexual Harassment of
the provisions of Section 186 of the Companies Act, 2013 are Women at Workplace (Prevention, Prohibition and Redressal)
given in the notes to the Financial Statements. Act, 2013. All employees (permanent, contractual, temporary
and trainees) are covered under this policy. The Company
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS has also complied with the provisions related to costitution
PASSED BY THE REGULATORS OR COURTS OR of Internal Complaints Committee (ICC) under the said Act to
TRIBUNALS IMPACTING THE GOING CONCERN STATUS redress complaints received regarding sexual harassment.
AND COMPANY’S OPERATIONS IN FUTURE The details of complaints pertaining to sexual harassment
There are no significant or material orders passed by the received during FY 2018-19 are given in the Corporate
Regulators/ Courts/ Tribunals that could impact the going Governance Report.
concern status of the Company and its future operations.
OTHER DISCLOSURES / REPORTING
However, Members’ attention is drawn to the statement on Your Directors state that no disclosure or reporting is required
contingent liabilities, commitments in the notes forming part in respect of the following items as there were no transactions
of the Financial Statements. pertaining to these items during the year under review:
PARTICULARS REGARDING CONSERVATION OF ENERGY, 1. Details relating to deposits covered under Chapter V
TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE of the Companies Act, 2013.
EARNINGS AND OUTGO
2.
Issue of equity shares with differential rights as to
Information in accordance with the provisions of Section dividend, voting or otherwise.
134(3)(m) of the Companies Act, 2013, read with Rule 8 of the
Companies (Accounts) Rules, 2014 regarding conservation 3.
Issue of shares (including sweat equity shares) to
of energy, technology absorption and foreign exchange employees of the Company under any scheme save and
earnings and outgo, is given in the statement annexed except ESOPs referred to in this Report.
(Annexure A) hereto and forms a part of this Report. 4.
Neither the Managing Director nor the Whole-time
Directors of the Company receive any remuneration or
PARTICULARS OF EMPLOYEES AND RELATED
commission from any of its subsidiaries.
DISCLOSURES
The information required to be disclosed in the Directors’ 33. APPRECIATION
Report pursuant to Section 197 of the Companies Act,
Your Directors take this opportunity to express their
2013, read with Rule 5 of the Companies (Appointment and
appreciation for the cooperation and assistance received
Remuneration of Managerial Personnel) Rules, 2014, is set out
from the Government of India, Republic of Chile, Mauritius,
as Annexure F to this Report.
Mozambique, Italy, the US and the UK, the State Governments
Having regard to the provisions of the first proviso to Section of Karnataka, Maharashtra, Tamil Nadu, West Bengal,
136(1) of the Companies Act, 2013, an abridged version of Jharkhand and Odisha and the financial institutions, banks as
the Annual Report, excluding the aforesaid information, well as the shareholders and debenture holders during the
is being sent to the members of the Company and others year under review. The Directors also wish to place on record
entitled thereto. For those persons who have registered their their appreciation of the devoted and dedicated services
e-mail addresses with the Company, the full version of the rendered by all employees of the Company.
Annual Report containing the aforesaid information is being
For and on behalf of the Board of Directors
sent to them electronically. Members and other entitled
persons who have not registered their e-mail addresses
with the Company may access the full version of the Annual Place: Mumbai Sajjan Jindal
Report on the website of the Companyorbyphysicallyinspecting Date : 24 May, 2019 Chairman
the full version of the Annual Report at the Registered Office
A. ENERGY CONSERVATION •
Interconnection of HP & LP steam network through
The Company has always been a frontrunner in continually PRDS system to provide steam from Sinter-2 waste
improving its operational performance in all areas, like heat recovery boiler to Coke oven resulting in steam
production, yield, plant utilisation and others, while reducing production @20 TPH.
the consumption of fuel, power, stores and others. This is • Implementation of online air fuel ratio logic at CPP, has
done by adopting an approach of continual improvement of resulted in reduction of gaseous heat rate by 10.6%.
process metrics across all energy consuming facilities.
• Fuel conversion of LCP 1, 2, & 3 from solid fuel (Coal) to
The Energy departments renewed its efforts by carrying By-product gas (BFG+COG) resulting in reduction of heat
out energy benchmarking with the best-in-class steel rate and lower CO2 emissions.
players and adopting some of the relevant best practices.
Energy conservation was taken up as a key improvement SALEM
theme during the year and the new approach attempted to • Reduced Fuel rate in Blast Furnace-1 by increasing Hot
prioritise actions through a three-pronged strategy: Blast Temperature after installation of High Temperature
1.
Higher Prevention / minimisation – i.e., Preventing Hot Blast Stoves which has resulted in energy savings of
wastage / minimisation of energy usage by relentless 5,159 Gcals in FY 2018-19.
optimisation of process parameters to achieve lower • Optimisation of Air Fuel ratio in BF Hot Blast stoves through
values of fuel / energy consumption. digitalisation initiative which has reduced the BF gas
2. Improving Recovery – deploying innovative methods of consumption, resulted savings of 6741 Gcals in FY 2018-19.
recovering higher amount of unused fuel heat in various • Energy saved by installation of motor with drive in Hydraulic
process exhausts / recovery systems. system in EOF2 resulted in power saving of 20,000 KWH/
3. Higher Re-use / Re-cycling – studying available potential month in FY 2018-19.
of recovered energy from various sources and doing a • Installation of VVVF drive in BLM Furnace blowers, Descalar
cost-benefit analysis of practices required. and Internal circulating water pump house motors resulted
in power savings of 2,211,538 Kwh in FY 2018-19.
STEPS TAKEN FOR ENERGY CONSERVATION:
• Power savings at Sinter Plant #2 through Waste gas ID fan
VIJAYANAGAR
impeller replacement with increased bed height operation
• Top recovery turbine power generation is 18.3MW which resulted in power savings of 1,037,434 Kwh in FY 2018-19.
fulfils 13.3 % of total power consumption requirement
of Blast Furnace. • Solid fuel savings at Sinter Plant #2 through installation
of three row burner with increased bed height operation
•
Substantially increased the BF PCI to 200 Kg/thm, by resulted in fuel savings of 519 MT in FY 2018-19.
reducing coke consumption.
• Installation of VFD in Blast furnace#2 cooling tower fans (8
• Increased LD gas recovery to 98.7 Nm3/TLS. No’s) resulted in savings of 298,084 Kwh in FY 2018-19.
• Commissioned blast furnace gas fired 150TPH boiler for
THE STEPS TAKEN BY THE COMPANY FOR UTILISING
power augmentation.
ALTERNATE SOURCES OF ENERGY:
• 45TPH of Steam generation through sinter cooler waste
VIJAYANAGAR
heat recovery boiler.
• 30% Increase in by-product gas supply YoY to power plants
•
Zero coal fired boilers, 100% by-product gas firing for resulted in coal saving of 21TPH.
process steam generation.
•
HSM waste heat recovery for steam generation is
• Reduction in oxygen venting by 36%. under progress.
DOLVI DOLVI
• Usage of Coke Oven Gas (COG) in place of Natural Gas to Usage of Coke Oven gas / Mixed gas at Dolvi as a replacement
improve cost efficiency in FY 2018-19, at Direct Reduced of NG at following facilities:
Iron (DRI), Tunnel Furnace and Bar Mill.
a)
Tunnel furnace heating, all ladle preheaters
heating at SMS.
• Optimisation of resource utilisation. • Process development for using high LOI iron ore micro
fines in sintering process.
•
Quality, productivity and cost optimization through
process efficiency improvements. •
Ball mill productivity improvement with controlled
Blain No. through consistent feed size to dry grinding
•
Product development, customization and
ball mill at PP1.
new applications.
• Optimisation of ignition intensity to enhance the sinter
•
Recycling and reuse of process waste and
properties at sintering plant.
conservation of natural resources.
• Development of process for reduction of NOx emission
• New application developments and promotion of slag
in sinter making.
usage in the country.
•
Studies on Precipitation behavior of niobium
•
New process technology development for process
micro-alloy steel in hot rolling process.
intensification and productivity.
• Study on effect of process parameters on the welding
R&D is actively involved in Industry- Institute partnership
characteristics of AHSS.
and has initiated eight collaborative projects in FY 2018-19
with leading academic and research institutes in India • Improving steel cleanliness in Electrical grade steels
- IIT Roorkee, IIT Kharagpur, IIMT Bhubaneswar, PSG for improved magnetic properties.
Coimbatore, Sona college of Engineering Tamilnadu, CBRI,
• Use of granulated LHF slag in cement making.
NEERI and NITK Surathkal.
B. TECHNOLOGY ABSORPTION, ADOPTION AND 9. A process for beneficiation and iron making from lean
INNOVATION iron ore fines using high ash coals.
VIJAYANAGAR 10.
System for material beneficiation involving
• Commissioning of raw water pond of 1.1 TMC. hydro-squeeze classifier assisted grinding ball mill.
1.
Dust burner system for injecting recycled-dust in
DOLVI
melter-gasifier with increased dust load and longer life-
• Commissioning of LCP Fuel Conversion. patent no: 298316.
• Commissioning of Coke Oven Battery A&B by Dolvi Coke 2.
A system for automated coil transfer car for
Projects Limited. productivity improvement in cold rolling mill complex.
- patent no: 299700.
SALEM
• Commissioning of paver block making machine. DOLVI
2. A process for recovery of ultra-fine particles from iron 5. White aluminium dross based briquetted synthetic slag
ore beneficiation plant tailing involving two-stage and a process of steel making using the same during
magnetic separation. tapping without fume generation.
7.
A process for manufacturing of calcium aluminate Total numbers of 29 papers have been published. (7 journal
cement from secondary steelmaking byproduct. publications – in international and National journals such as
Journal of Nondestructive testing, Materials engineering and
8. A system for zinc removal from steel plant process waste performance, Steel tech, Mineral processing and metallurgical
and upgradation of its Fe values and a process thereof. engineering, Ceramics international etc and a total of 22
National and International conference proceedings).
DOLVI
The R&D developments in process improvement,
A total of 4 papers in National and International journals and energy optimization and cost reduction have helped in
conference proceedings were published. substantial savings in operational costs and revenue
generation due to product development.
SALEM
Savings (` in Crores)
Total of 8 papers (7 journal papers and 1 paper in conference Vijayanagar Dolvi Salem
proceedings) have been published. 54 18 23
i)
The benefits derived like product improvement, cost
reduction, product development or import substitution
ii) Information regarding Imported Technology (Imported during the last three years reckoned from the
beginning of the financial year)
(` In Crores)
FY 2018 – 19 FY 2017 – 18
Foreign Exchange earned 7,604 10,938
Foreign Exchange used 28,015 22,617
[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies
(Management and Administration) Rules, 2014]
% Of Shares
Sr. N0 Name Of The Company Address Of The Company Cin/Gln
Held
17 Hutchinson Minerals, LLC 407 Prosperity Road, Prosperity, WV, 25909 Not applicable 100%
18 RC Minerals, LLC 407 Prosperity Road, Prosperity, WV, 25909 Not applicable 100%
19 Peace Leasing, LLC 407 Prosperity Road, Prosperity, WV, 25909 Not applicable 100%
20 JSW Panama Holdings Corporation 48th East Street, Bella, Vista, P.O. Box No. Not applicable 100%
0816-01832, Panama.
21 Inversiones Eurosh Limitada Juan Franciscvo Gonzalez 562, Sector Placilla, Not applicable 100%
Morales Copiapo, Chile
22 Santa Fe Mining S.A. Juan Franciscvo Gonzalez 562, Sector Placilla, Not applicable 70%
Morales Copiapo, Chile
23 Santa Fe Puerto S.A. Apoquindo 3650 Oficina 803, Las Not applicable 70%
Condes, Santiago.
24 JSW Steel Processing Centres Limited JSW Centre, Bandra –Kurla Complex, Bandra U01010MH2003PLC176595 100%
East, Mumbai 400 051
25 JSW Jharkhand Steel Limited JSW Centre, Bandra –Kurla Complex, Bandra U27310MH2007PLC171405 100%
East, Mumbai 400 051
26 JSW Bengal Steel Limited JSW Centre, Bandra Kurla Complex U27106MH2007PLC170160 98.69%
Bandra(E), Mumbai-51.
27 JSW Natural Resources India Limited JSW Centre, Bandra Kurla Complex U14200MH2007PLC173687 98.69%
Bandra(E), Mumbai-51.
28 JSW Energy (Bengal) Limited JSW Centre, Bandra Kurla Complex U40300MH2010PLC199844 98.69%
Bandra(E), Mumbai-51.
29 JSW Natural Resources Bengal Limited JSW Centre, Bandra Kurla Complex U10300MH2010PLC200871 98.69%
Bandra(E), Mumbai-51.
30 JSW Steel Coated Products Limited JSW Centre, Bandra Kurla Complex U27100MH1985PLC037346 100%
Bandra(E), Mumbai-51.
31 Amba River Coke Limited JSW Centre, Bandra Kurla Complex U23100MH1997PLC110901 100%
Bandra(E), Mumbai-51.
32 Peddar Realty Private Limited JSW Centre, Bandra Kurla Complex U45200MH2002PTC137214 100%
Bandra(E), Mumbai-51.
33 Arima Holdings Limited 42 Hotels Street, 3rd Floor, Gfin Tower, Cybercity, Not Applicable 100%
Ebene, Mauritius
34 Lakeland Securities Limited 42 Hotels Street, 3rd Floor, Gfin Tower, Cybercity, Not Applicable 100%
Ebene, Mauritius
35 Erebus Limited 42 Hotels Street, 3rd Floor, Gfin Tower, Cybercity, Not Applicable 100%
Ebene, Mauritius
36 Nippon Ispat Singapore (PTE) Ltd 17 Philip Street # 05-01 Grand Building, Reg No.199303132W 100%
Singapore 048695.
37 Acero Junction Holdings, Inc 1500 Commercial St, Mingo Junction , OH 43938- Not applicable 100%
1096, United States
38 JSW Steel USA Ohio, Inc 1500 Commercial St, Mingo Junction , OH 43938- Not applicable 100%
1096, United States
39 JSW Steel (Salav) Limited Welspun City, Village Versamedi, Taluka Anjar, U27100GJ2008PLC064145 100%
Kutch, Anjar Gujrat.
40 JSW Industrial Gases Private Limited JSW Centre, Bandra Kurla Complex U85110KA1995PTC018868 100%
Bandra(E), Mumbai-51
41 JSW Steel Italy S.r.l. Largo Caduti Sul Lavoro 21 Not Applicable 100%
PIOMBINO (LI), 57025, Italy
42 Aferpi S.p.A Largo Caduti Sul Lavoro 21 Not applicable 100%
PIOMBINO (LI), 57025, Italy
43 Piombino Logistics S.p.A Largo Caduti Sul Lavoro 21 Not applicable 100%
PIOMBINO (LI), 57025, Italy
44 GSI Lucchini S.p.A Largo Caduti Sul Lavoro 21 Not applicable 69.27%
PIOMBINO (LI), 57025, Italy
45 JSW Utkal Steel Limited JSW Centre, Bandra Kurla Complex, Bandra (E), U27209MH2017PLC301887 100%
Mumbai 400 051.
46 Hasaud Steel Limited Grand Palladium, 6th Floor, 175, CST Road, U27209MH2018PLC305033 100%
Santacruz East, Mumbai 400 098
47 JSW Retail Limited JSW Centre, Bandra Kurla Complex, Bandra (E), U27300MH2018PLC314290 100%
Mumbai 400 051.
48 Dolvi Mineral & Metals Private Limited JSW Centre, Bandra Kurla Complex, Bandra (E), U51900MH2014PTC257483 100%
Mumbai 400 051.
49 Dolvi Coke Projects Limited JSW Centre, Bandra Kurla Complex, Bandra (E), U23209MH2014PLC254395 100%
Mumbai 400 051.
% Of Shares
Sr. N0 Name Of The Company Address Of The Company Cin/Gln
Held
Associates & Joint Ventures (Applicable Section 2(6))
50 Creixent Special Steel Limited QR No. 50-51,Park Avenue colony, Jindal Road, U27209OCT2018PLC008397 48%
Dhimrapur, Raigarh, Chattisgarh 496001
51 Monnet Ispat & Energy Limited Naharpali, Tehsil, Kharsia, Raigarh L0271OCT1990PLC009826 23.10%
52 Vijayanagar Minerals Private Limited Toranagallu Village, Sandur Taluk, Bellary U13100KA1997PTC022398 40%
53 Rohne Coal Company Private Limited A-2, Shaheed Jeet Singh marg, Qutub Institutional U10300DL2008PTC176675 49%
Area, New Delhi 110 016
54 Geo Steel LLC 36 Davit Gareji St Not applicable 49%
Rustavi, Georgia, 3700
55 JSW Severfield Structures Limited 401, Grande Palladium, 175 CST Road, U28112MH2009PLC191045 50%
Kalina, Santacruz (East) Mumbai Mumbai
City, MH 400098
56 JSW Structural Metal Decking Limited Office no. 601, 6th Floor, Gujral House, Plot No. 167, U28112MH2009PLC197954 33.33%
C.S.T. Road, Kalina, Santacruz (E) Mumbai Mumbai
City, MH 400098
57 Gourangdih Coal Limited 5B, Nandalal Basu Sarani, Kolkata U10100WB2009PLC1393007 50%
Kolkata, WB 700071
58 JSW MI Steel Services Center JSW Centre, Bandra Kurla Complex, Bandra East, U74900MH2011PTC222152 50%
Private Limited Mumbai, MH 400051
59 JSW Vallabh Tinplate Private Limited Flat No. 1309,13th Floor Vikram Tower, Rajendra U28112DL1995PTC204971 50%
Place, New Delhi 110008
IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity):
1 Category-wise Share Holding: -
no. of shares held at the beginning of the year no. of shares held at the end of the year
01.04.2018 31.03.2019 % Change
Category
Category Of Shareholder % Of During
Code % Of Total
Demat Physical Total Demat Physical Total Total The Year
Shares
Shares
(I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX) (X) (XI)
(A) PROMOTER
AND PROMOTER GROUP
(1) INDIAN
(a) Individual /HUF 14510770 0 14510770 0.60 14584040 0 14584040 0.60 0.00
(b) Central Government/ 9079520 0 9079520 0.38 9079520 0 9079520 0.38 0.00
State Government(s)
(c) Bodies Corporate 935543350 0 935543350 38.70 957420350 0 957420350 39.61 0.91
(d) Financial Institutions / Banks 0 0 0 0.00 0 0 0 0.00 0.00
(e) Others 600 0 600 0.00 600 0 600 0.00 0.00
Sub-Total A(1) : 959134240 0 959134240 39.68 981084510 0 981084510 40.59 0.91
(2) FOREIGN
(a) Individuals (NRIs/ 0 0 0 0.00 0 0 0 0.00 0.00
Foreign Individuals)
(b) Bodies Corporate 50021540 0 50021540 2.07 50021540 0 50021540 2.07 0.00
(c) Institutions 0 0 0 0.00 0 0 0 0.00 0.00
(d) Qualified Foreign Investor 0 0 0 0.00 0 0 0 0.00 0.00
(e) Others 0 0 0 0.00 0 0 0 0.00 0.00
Sub-Total A(2) : 50021540 0 50021540 2.07 50021540 0 50021540 2.07 0.00
Total A=A(1)+A(2) 1009155780 0 1009155780 41.75 1031106050 0 1031106050 42.66 0.91
(B) PUBLIC SHAREHOLDING
(1) INSTITUTIONS
(a) Mutual Funds /UTI 58424736 152510 58577246 2.42 47224701 152510 47377211 1.96 -0.46
(b) Financial Institutions /Banks 8592447 17650 8610097 0.36 22005362 18270 22023632 0.91 0.55
(c) Central Government / 12375000 0 12375000 0.51 12375000 0 12375000 0.51 0.00
State Government(s)
(d) Venture Capital Funds 0 0 0 0.00 0 0 0 0.00 0.00
(e) Insurance Companies 0 0 0 0.00 0 0 0 0.00 0.00
(f) Foreign Institutional Investors 479964786 97750 480062536 19.86 449025505 97750 449123255 18.58 -1.28
no. of shares held at the beginning of the year no. of shares held at the end of the year
01.04.2018 31.03.2019 % Change
Category
Category Of Shareholder % Of During
Code % Of Total
Demat Physical Total Demat Physical Total Total The Year
Shares
Shares
(I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX) (X) (XI)
(g) Foreign Venture 0 0 0 0.00 0 0 0 0.00 0.00
Capital Investors
(h) Qualified Foreign Investor 0 0 0 0.00 0 0 0 0.00 0.00
(i) Others 0 0 0 0.00 0 0 0 0.00 0.00
Sub-Total B(1) : 559356969 267910 559624879 23.15 530630568 268530 530899098 21.96 -1.19
(2) NON-INSTITUTIONS
(a) Bodies Corporate 188421487 4993500 193414987 8.00 185516708 4985130 190501838 7.88 -0.12
(b) Individuals
(i) Individuals holding nominal 94081643 19811708 113893351 4.71 92146917 16609570 108756487 4.50 -0.21
share capital upto `2 lakh
(ii) Individuals holding 124346201 0 124346201 5.14 132615432 0 132615432 5.49 0.34
nominal share capital in
excess of `2 lakh
(c) Others
Foreign Bodies Corporates 362583070 1660 362584730 15.00 362583070 1660 362584730 15.00 0.00
IEPF 12027406 0 12027406 0.50 13049760 0 13049760 0.54 0.04
Non Resident Indians 25241320 3530120 28771440 1.19 25037328 3215650 28252978 1.17 -0.02
NRI Non- Repatriation 2089524 0 2089524 0.09 2194892 0 2194892 0.09 0.00
Overseas Corporate Bodies 0 9660 9660 0.00 0 9660 9660 0.00 0.00
Trusts 11302482 0 11302482 0.46 17249515 0 17249515 0.71 0.25
(d) Qualified Foreign Investor 0 0 0 0.00 0 0 0 0.00 0.00
Sub-Total B(2) : 820093133 28346648 848439781 35.10 830393622 24821670 855215292 35.38 0.28
Total B=B(1)+B(2) : 1379450102 28614558 1408064660 58.25 1361024190 25090200 1386114390 57.34 -0.91
Total (A+B) : 2388605882 28614558 2417220440 100.00 2392130240 25090200 2417220440 100.00 0.00
(C) SHARES HELD BY CUSTODIANS, AGAINST WHICH DEPOSITORY RECEIPTS HAVE BEEN ISSUED
(1) Promoter and Promoter Group 0 0 0 0.00 0 0 0 0.00 0.00
(2) Public 0 0 0 0.00 0 0 0 0.00 0.00
GRAND TOTAL (A+B+C) : 2388605882 28614558 2417220440 100.00 2392130240 25090200 2417220440 100.00
Shareholding at the beginning of the Year Shareholding at the end of the Year
01.04.2018 31.03.2019
% of Shares
% of Total % of Shares No of % of Total % change in
Sl.no Name of the Share Holder No of Shares Pledged/
Shares Pledged/ Shares Shares shareholding
held as on encumbered
of the encumbered to Held As on of the
01.04.2018 to total
Company total shares 31.03.2019 Company
shares
1 JSW TECHNO PROJECTS MANAGEMENT LTD 229326950 9.49 55.99 223328450 9.24 82.04 -0.25
2 JSW HOLDINGS LIMITED 177306230 7.34 50.77 178837230 7.40 32.64 0.06
3 VIVIDH FINVEST PRIVATE LIMITED 140726690 5.82 62.85 141995690 5.87 47.99 0.05
4 SAHYOG HOLDINGS PRIVATE LIMITED 110597360 4.58 55.95 111672860 4.62 63.48 0.04
5 JSW ENERGY LIMITED 0 0.00 0.00 70038350 2.90 12.79 2.90
6 DANTA ENTERPRISES PRIVATE LIMITED 60368250 2.50 70.23 60368250 2.50 70.82 0.00
7 VIRTUOUS TRADECORP PRIVATE LIMITED 60368250 2.50 20.41 60368250 2.50 26.34 0.00
8 NALWA SONS INVESTMENTS LTD 45486370 1.88 0.00 45486370 1.88 0.00 0.00
9 JSW TECHNO PROJECTS MANAGEMENT 0 0.00 0.00 24000000 0.99 0.00 0.99
LIMITED
10 JSL OVERSEAS LIMITED 21026090 0.87 0.00 21026090 0.87 0.00 0.00
11 GLEBE TRADING PRIVATE LIMITED 17157930 0.71 74.07 17157930 0.71 84.70 0.00
12 JSW LOGISTICS INFRASTRUCTURE 17125770 0.71 0.00 17125770 0.71 0.00 0.00
PRIVATE LIMITED
13 BEAUFIELD HOLDINGS LIMITED 16409910 0.68 0.00 16409910 0.68 0.00 0.00
14 KARNATAKA STATE INDUSTRIAL AND 9079520 0.38 0.00 9079520 0.38 0.00 0.00
INFRASTRUCTURE DEVELOPMENT CORPN
15 SIDDESHWARI TRADEX PRIVATE LIMITED 7024580 0.29 0.00 7024580 0.29 0.00 0.00
16 MENDEZA HOLDINGS LIMITED 4218090 0.17 0.00 4218090 0.17 100.00 0.00
17 NACHO INVESTMENTS LIMITED 4207380 0.17 0.00 4207380 0.17 100.00 0.00
18 ESTRELA INVESTMENT COMPANY LIMITED 4160070 0.17 0.00 4160070 0.17 100.00 0.00
19 TARINI JINDAL HANDA 4913890 0.20 32.50 4913890 0.20 29.96 0.00
20 TANVI SHETE 4883630 0.20 0.00 4883630 0.20 0.00 0.00
21 PARTH JINDAL 3520000 0.15 0.00 1820000 0.08 0.00 -0.07
22 SEEMA JAJODIA 0 0.00 0.00 1750000 0.07 0.00 0.07
25 URMILA BHUWALKA 260000 0.01 0.00 283270 0.01 74.13 0.00
26 ARTI JINDAL 227550 0.01 0.00 227550 0.01 0.00 0.00
27 DEEPIKA JINDAL 148650 0.01 0.00 148650 0.01 0.00 0.00
28 NIRMALA GOYAL 120000 0.00 0.00 120000 0.00 0.00 0.00
29 PRITHAVI RAJ JINDAL 84580 0.00 0.00 84580 0.00 0.00 0.00
30 SAVITRI DEVI JINDAL 75300 0.00 0.00 75300 0.00 0.00 0.00
31 S K JINDAL AND SONS HUF . 58000 0.00 0.00 58000 0.00 0.00 0.00
32 SMINU JINDAL 55970 0.00 0.00 55970 0.00 0.00 0.00
33 TRIPTI JINDAL 50660 0.00 0.00 50660 0.00 0.00 0.00
35 P R JINDAL HUF . 45550 0.00 0.00 45550 0.00 0.00 0.00
36 NAVEEN JINDAL 54990 0.00 0.00 54990 0.00 0.00 0.00
39 HEXA TRADEX LIMITED 13620 0.00 0.00 13620 0.00 0.00 0.00
40 AIYUSH BHUWALKA 10000 0.00 0.00 10000 0.00 0.00 0.00
41 REYNOLD TRADERS PRIVATE LIMITED 1000 0.00 0.00 1000 0.00 0.00 0.00
42 JSW PROJECTS LIMITED 1000 0.00 0.00 1000 0.00 0.00 0.00
43 JSW INVESTMENTS PRIVATE LIMITED 1000 0.00 0.00 1000 0.00 0.00 0.00
44 SAJJAN JINDAL 1000 0.00 0.00 1000 0.00 0.00 0.00
45 SANGITA JINDAL 1000 0.00 0.00 1000 0.00 0.00 0.00
46 TANVI JINDAL FAMILY TRUST 100 0.00 0.00 100 0.00 0.00 0.00
47 TARINI JINDAL FAMILY TRUST 100 0.00 0.00 100 0.00 0.00 0.00
48 PARTH JINDAL FAMILY TRUST 100 0.00 0.00 100 0.00 0.00 0.00
49 SAJJAN JINDAL FAMILY TRUST 100 0.00 0.00 100 0.00 0.00 0.00
50 SANGITA JINDAL 100 0.00 0.00 100 0.00 0.00 0.00
FAMILY TRUST
51 SAJJAN JINDAL 100 0.00 0.00 100 0.00 0.00 0.00
LINEAGE TRUST
52 JSW POWER TRADING COMPANY LIMITED 70038350 2.90 12.79 0 0.00 0.00 -2.90
Total 1009155780 41.75 1031106050 42.66 0.91
3. Change in Promoters & Promoter Group Shareholding (please specify, if there is no change):
Sl.No. Name of the Share Holder Shareholding at the Cumulative shareholding Remarks
beginning of the year during the year
% of total No of % of total
No of Shares No. of shares at
shares Shares shares
held as on Date Sold Purchased the end of the
of the held As on of the
01.04.2018 year
Company 31.03.2019 Company
1 JSW TECHNO PROJECTS 229326950 9.49 223328450 9.24 01-04-2018 0 0 229326950
MANAGEMENT LTD
13-07-2018 0 2565000 231891950
20-07-2018 0 616500 232508450
03-08-2018 0 1070000 233578450
10-08-2018 0 1266650 234845100
17-08-2018 0 990350 235835450
24-08-2018 0 1790000 237625450
31-08-2018 0 710000 238335450
07-09-2018 0 1210000 239545450
14-09-2018 23275000 0 216270450
21-09-2018 0 195000 216465450
28-09-2018 0 1465000 217930450
05-10-2018 0 2670000 220600450
12-10-2018 0 2423000 223023450
31-03-2019 0 305000 223328450
2 JSW HOLDINGS LIMITED 177306230 7.34 178837230 7.40 01-04-2018 0 0 177306230
24-08-2018 0 300000 177606230
31-08-2018 0 100000 177706230
07-09-2018 0 60000 177766230
14-09-2018 0 370000 178136230
28-09-2018 0 300000 178436230
05-10-2018 0 165000 178601230
22-03-2019 0 200000 178801230
29-03-2019 0 36000 178837230
31-03-2019 0 0 178837230
3 VIVIDH FINVEST PRIVATE 140726690 5.82 141995690 5.87 01-04-2018 0 0 140726690
LIMITED
29-03-2019 0 1269000 141995690
31-03-2019 0 0 141995690
4 SAHYOG HOLDINGS PRIVATE 110597360 4.58 111672860 4.62 31-03-2018 0 0 110597360
LIMITED
15-03-2019 0 855500 111452860
22-03-2019 0 220000 111672860
31-03-2019 0 0 111672860
5 JSW ENERGY LIMITED 0 0.00 70038350 2.90 01-04-2018 0 0 0
06-04-2018 0 61078350 61078350
20-04-2018 0 8960000 70038350
30-03-2019 0 0 70038350
Sl.No. Name of the Share Holder Shareholding at the Cumulative shareholding Remarks
beginning of the year during the year
% of total No of % of total
No of Shares No. of shares at
shares Shares shares
held as on Date Sold Purchased the end of the
of the held As on of the
01.04.2018 year
Company 31.03.2019 Company
20-07-2018 0 616500 232508450
03-08-2018 0 1070000 233578450
10-08-2018 0 1266650 234845100
17-08-2018 0 990350 235835450
24-08-2018 0 1790000 237625450
31-08-2018 0 710000 238335450
07-09-2018 0 1210000 239545450
14-09-2018 23275000 0 216270450
21-09-2018 0 195000 216465450
28-09-2018 0 1465000 217930450
29-09-2018 0 1465000 217930450
05-10-2018 0 2670000 220600450
12-10-2018 0 2423000 223023450
19-10-2018 0 305000 223328450
31-03-2019 0 0 223328450
Sl.No. Name of the Share Holder Shareholding at the Cumulative shareholding Remarks
beginning of the year during the year
% of total No of % of total
No of Shares No. of shares at
shares Shares shares
held as on Date Sold Purchased the end of the
of the held As on of the
01.04.2018 year
Company 31.03.2019 Company
24 TANVI SHETE 1383630 0.06 1383630 0.06 01-04-2018 0 0 1383630
31-03-2019 0 0 1383630
25 URMILA BHUWALKA 260000 0.01 283270 0.01 01-04-2018 0 0 260000
13-04-2018 0 22270 282270
28-09-2018 0 1000 283270
29-09-2018 0 1000 283270
31-03-2019 0 0 283270
26 ARTI JINDAL 227550 0.01 227550 0.01 01-04-2018 0 0 227550
31-03-2019 0 0 227550
27 DEEPIKA JINDAL 148650 0.01 148650 0.01 01-04-2018 0 0 148650
31-03-2019 0 0 148650
28 NIRMALA GOYAL 120000 0.00 120000 0.00 01-04-2018 0 0 120000
31-03-2019 0 0 120000
29 PRITHAVI RAJ JINDAL 84580 0.00 84580 0.00 01-04-2018 0 0 84580
31-03-2019 0 0 84580
30 SAVITRI DEVI JINDAL 75300 0.00 75300 0.00 01-04-2018 0 0 75300
31-03-2019 0 0 75300
31 S K JINDAL AND SONS HUF . 58000 0.00 58000 0.00 01-04-2018 0 0 58000
31-03-2019 0 0 58000
32 SMINU JINDAL 55970 0.00 55970 0.00 01-04-2018 0 0 55970
31-03-2019 0 0 55970
33 TRIPTI JINDAL 50660 0.00 50660 0.00 01-04-2018 0 0 50660
31-03-2019 0 0 50660
34 P R JINDAL HUF . 45550 0.00 45550 0.00 01-04-2018 0 0 45550
31-03-2019 0 0 45550
35 NAVEEN JINDAL 54990 0.00 54990 0.00 01-04-2018 0 0 54990
31-03-2019 0 0 54990
36 HEXA TRADEX LIMITED 13620 0.00 13620 0.00 01-04-2018 0 0 13620
31-03-2019 0 0 13620
37 AIYUSH BHUWALKA 10000 0.00 10000 0.00 01-04-2018 0 0 10000
31-03-2019 0 0 10000
38 REYNOLD TRADERS 1000 0.00 1000 0.00 01-04-2018 0 0 1000
PRIVATE LIMITED
31-03-2019 0 0 1000
39 JSW PROJECTS LIMITED 1000 0.00 1000 0.00 01-04-2018 0 0 1000
31-03-2019 0 0 1000
40 JSW INVESTMENTS PRIVATE 1000 0.00 1000 0.00 01-04-2018 0 0 1000
LIMITED 31-03-2019 0 0 1000
41 SAJJAN JINDAL 1000 0.00 1000 0.00 01-04-2018 0 0 1000
31-03-2019 0 0 1000
42 SANGITA JINDAL 1000 0.00 1000 0.00 01-04-2018 0 0 1000
31-03-2019 0 0 1000
43 SAJJAN JINDAL 100 0.00 100 0.00 01-04-2018 0 0 100
FAMILY TRUST 31-03-2019 0 0 100
44 SAJJAN JINDAL 100 0.00 100 0.00 01-04-2018 0 0 100
LINEAGE TRUST 31-03-2019 0 0 100
45 SANGITA JINDAL 100 0.00 100 0.00 01-04-2018 0 0 100
FAMILY TRUST 31-03-2019 0 0 100
46 TARINI JINDAL 100 0.00 100 0.00 01-04-2018 0 0 100
FAMILY TRUST 31-03-2019 0 0 100
47 TANVI JINDAL 100 0.00 100 0.00 01-04-2018 0 0 100
FAMILY TRUST 31-03-2019 0 0 100
Sl.No. Name of the Share Holder Shareholding at the Cumulative shareholding Remarks
beginning of the year during the year
% of total No of % of total
No of Shares No. of shares at
shares Shares shares
held as on Date Sold Purchased the end of the
of the held As on of the
01.04.2018 year
Company 31.03.2019 Company
48 PARTH JINDAL 100 0.00 100 0.00 01-04-2018 0 0 100
FAMILY TRUST 31-03-2019 0 0 100
49 JSW POWER TRADING 70038350 2.90 0 0.00 01-04-2018 0 0 70038350
COMPANY LIMITED 06-04-2018 61078350 0 8960000
20-04-2018 8960000 0 0
31-03-2019 0 0 0
4. Shareholding Pattern of top ten Shareholders: (other than Directors, Promoters and Holders of GDRs and
ADRs):
Shareholding at the Cumulative shareholding Date Sold Purchased No. of shares at
beginning of the year during the year the end of the
year
Sl.No. Name of the Share Holder % of Total No of % of Total
No of Shares
Shares Shares Shares
held as on
of the Held As on of the
01.04.2018
Company 31.03.2019 Company
1 JFE STEEL INTERNATIONAL 362583070 15 362583070 15 01.04.2018 0 0 362583070
EUROPE B.V.
31.03.2019 0 0 362583070
4 APMS INVESTMENT FUND LTD 36885000 1.53 36885000 1.53 01-04-2018 0 0 36885000
31-03-2019 0 0 36885000
5 THELEME MASTER FUND LIMITED 9157172 0.38 28905847 1.20 01-04-2018 0 0 9157172
06-04-2018 0 4810612 13967784
18-05-2018 0 1329328 15297112
25-05-2018 0 1300000 16597112
31-08-2018 0 1875000 18472112
07-09-2018 0 2700000 21172112
11-01-2019 0 1200656 22372768
01-02-2019 0 1708281 24081049
08-02-2019 0 1406798 25487847
15-02-2019 0 1868000 27355847
22-02-2019 0 1100000 28455847
01-03-2019 0 100000 28555847
08-03-2019 0 350000 28905847
31.03.2019 0 0 28905847
8 ENAM SECURITIES PVT LTD 20847750 0.86 24052750 1.00 01-04-2018 0 0 20847750
08-06-2018 0 3205000 24052750
31-03-2019 0 0 24052750
10 ELM PARK FUND LIMITED 19350000 0.80 19350000 0.80 01-04-2018 0 0 19350000
31-03-2019 0 0 19350000
5. Shareholding of Directors and Key Managerial Personnel:
SN Name of the Directors and KMP Shareholding at the beginning Cumulative Shareholding during the
of the year 01.04.2018 year 31.03.2019
No. of shares % of total No. of shares % of total
shares of the shares of the
company company
1 Mr. Sajjan Jindal, Chairman & Managing Directors 1000 0.00 1000 0.00
2 Mr. Seshagiri Rao MVS, Jt. Managing Director & Group CFO 223200 0.01 223200 0.01
3 Dr. Vinod Nowal, Dy. Managing Director 120560 0.00 120560 0.00
4 Mr. Jayant Acharya, Director (Commercial & Marketing) 112060* 0.00 112060* 0.00
5 Mr. Hiroyuki Ogawa 0 0.00 0 0.00
6 Mrs. Gunjan Krishna, IAS 0 0.00 0 0.00
SN Name of the Directors and KMP Shareholding at the beginning Cumulative Shareholding during the
of the year 01.04.2018 year 31.03.2019
No. of shares % of total No. of shares % of total
shares of the shares of the
company company
7 Mr. Seturaman Mahalingam 0 0.00 0 0.00
8 Mr. Malay Mukherjee 0 0.00 0 0.00
9 Mr. Haigreve Khaitan 0 0.00 0 0.00
10 Dr. (Mrs) Punita Kumar Sinha 0 0.00 0 0.00
11 Mr. Harsh Charandas Mariwala 0 0.00 0 0.00
12 Mrs. Nirupama Rao 0 0.00 0 0.00
13 Mr. Rajeev Pai, Chief Financial Officer 0 0.00 0 0.00
14 Mr Lancy Varghese, Company Secretary 0 0.00 0 0.00
V. INDEBTEDNESS
Indebtedness of the Company including interest outstanding/accrued but not due for payment:-
(` in Crores)
Secured Loans Unsecured Total
Deposits
excluding deposits Loans Indebtedness
INDEBTEDNESS AT THE BEGINNING OF THE FINANCIAL YEAR
i) Principal Amount 14977 21204 - 36181
ii) Interest due but not paid - - - -
iii) Interest accrued but not due 114 207 - 321
Total (i+ii+iii)
* Addition 1980 25777 - 27757
* Reduction 20551 1367 - 21918
NET CHANGE 18571 24410 - 5839
INDEBTEDNESS AT THE END OF THE FINANCIAL YEAR
i) Principal Amount 14246 27692 - 41938
ii) Interest due but not paid - - - -
iii) Interest accrued but not due 111 292 - 403
Total (i+ii+iii) 14357 27984 - 42341
Amt in ` Crores
Name of MD/WTD/ Manager Total
SN. Particulars of Remuneration
Mr. Sajjan Jindal Mr. Seshagiri Rao Dr. Vinod Nowal Mr. Jayant Acharya Amount
1 Gross salary
(a) Salary as per provisions contained in section 17(1) 10.88 5.40 4.18 3.35 23.81
of the Income-tax Act, 1961
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 1.30 0.25 0.18 0.16 1.89
(c) Profits in lieu of salary under section 17(3) - - - - -
Income- tax Act, 1961
2 Stock Option
3 Sweat Equity
4 Commission 57.16 - - - 57.16
- as % of profit
- others, specify…
5 Others, please specify - - - - -
Total (A) 69.34 5.65 4.36 3.51 82.86
Ceiling as per the Act (@10% of profits calculated under 1203.45
Section 198 of the Companies Act, 2013)
[Pursuant to section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014]
iii. The Depositories Act, 1996 and the Regulations and Bye-laws We have also examined compliance with the applicable
framed thereunder; clauses of the following:
iv. The Foreign Exchange Management Act, 1999, and the rules a) Secretarial Standards
and regulations made thereunder to the extent of Foreign
The Secretarial Standards SS-1, SS-2 and SS-3 issued and
Direct Investment, Overseas Direct Investment and External
notified by the Institute of Company Secretaries of India
Commercial Borrowings;
have been generally complied with by the Company during
the year under review;
b) SEBI (Listing Obligations and Disclosure • During the year under review, the Company has fully redeemed
Requirements) Regulations, 2015 27,90,34,907, 10% Cumulative Redeemable Preference
Shares (two installments in FY 2017-18 and two installments
The Company has complied with the applicable
in 2018-19). The Company has also partially redeemed its
regulations of the Securities and Exchange Board of
48,54,14,604, 0.01% Cumulative Redeemable Preference
India (Listing Obligations and Disclosure Requirements)
Shares of `10/- each fully paid up, in four equal installments
Regulations, 2015.
of `1.25/- per share on 15.06.2018, 15.09.2018, 15.12.2018 and
During the year under review the Company has complied with the 15.03.2019. The Preference share capital as on 31.03.2019 is
aforesaid provisions of the Act, Rules, Regulations, Standards, etc. ` 242,70,73,020/- comprising of 48,54,14,604, 0.01% Cumulative
Redeemable Preference Shares of ` 5/- each.
We further report that,
• The Company has completed acquisition of 100% equity stake
The Board of Directors of the Company is duly constituted with
in Acero Junction Holdings, Inc. (Acero) for a cash consideration
proper balance of Executive Directors, Non-Executive Directors
of ` 536 crores (USD 80.85 million) along with its wholly owned
and Independent Directors. The changes in the composition of the
subsidiary JSW Steel USA Ohio, Inc. (JSWSUO) (Formerly known
Board of Directors that took place during the year under review
as Acero Junction, Inc.) on 15 June 2018.
were carried out in compliance with the provisions of the Act.
• Pursuant to the Corporate Insolvency Resolution process under
Adequate notices are given to all the Directors to schedule the
the Insolvency Bankruptcy Code, 2016 initiated on 18 July 2017,
Board Meetings, agenda and detailed notes on agenda were
the National Company Law Tribunal (‘NCLT’) on 24 July 2018
sent at least seven days in advance, and a system exists for
(Order date) approved (with modifications) the resolution plan
seeking and obtaining further information and clarifications on the
submitted by the consortium of JSW Steel Limited and AION
agenda items before the meeting and for meaningful participation
Investments Private II Limited. The consortium completed the
at the meeting.
acquisition of Monnet Ispat & Energy Limited (“MIEL”) through
Decisions at the meetings of the Board of Directors were carried their jointly controlled entity Creixent Special Steels Limited
through on the basis of majority and there were no dissenting (“CSSL”) on 31 August 2018. The Company made an investment
views by any Member of the Board during the year under review. of ` 375 crores through equity and redeemable preference
shares in CSSL to acquire joint control in MIEL.
We further report that,
• The Resolution Plan submitted by the Company for Vardhman
Based on the information provided and the representation
Industries Limited (VIL) was approved with some modification, by
made by the Company and also on the review of the compliance
the Hon’ble NCLT New Delhi, by its order dated 19 December 2018
reports of Company Secretary / Chief Financial Officer /
under Section 31 of the Insolvency and Bankruptcy Code,
Whole-time Director taken on record by the Board of Directors
2016 (NCLT Order). The Company filed an application before
of the Company, in our opinion there are adequate systems and
the Hon’ble NCLT seeking certain clarifications/modifications
processes in the Company commensurate with the size and
to the NCLT Order. The Hon’ble NCLT, by its order dated 7
operations of the Company to monitor and ensure compliance
January 2019, deferred the implementation of the resolution
with applicable laws, rules, regulations and guidelines.
Plan until clarifications are processed by the Regular Bench.
The compliance by the Company of applicable financial laws The hearing on the Clarification Application concluded on 28
such as direct and indirect tax laws and maintenance of financial January 2019 and was reserved for orders. Meanwhile, an Appeal
records and books of accounts has not been reviewed in this was filed before the Hon’ble National Company Law Appellate
Audit since the same have been subject to review by statutory Tribunal (‘NCLAT’) on 1 February 2019. The Hon’ble National
financial audit and other designated professionals. Company Law Appellate Tribunal, by its order dated 30April 2019,
(“NCLAT Order”) received by the Company on May 01, 2019, inter
We further report that, during the audit period, except the events
alia suggested that the Resolution Plan as approved by the
listed below no other events occurred which had any major
Committee of Creditors may be implemented subject to final
bearing on the Company’s affairs in pursuance of the above
orders to be passed by the Hon’ble NCLAT on the Appeal.
referred laws, rules, regulations, guidelines, and standards and
that the Company has complied with such of those relevant • The Company through its wholly owned subsidiary in Italy, JSW
clauses thereto which are applicable: Steel Italy S.r.l, completed acquisition of 100% shares each of
Aferpi S.p.A (“Aferpi”) and Piombino Logistics S.p.A (“PL”) and
• The Company has fully redeemed the following Non-Convertible
69.27% of the shares of GSI Lucchini S.p.A (“GSI”) (collectively
Debentures during the year under review:
referred to as “Targets”) for a consideration of ` 489 crores (Euro
1.
1750 10.50% secured Non-Convertible Debentures of 60.70 million) towards acquisition of equity shares and ` 100
` 10,00,000 each crores (Euro 12.38 million) towards acquisition of loans provided
by erstwhile shareholders of the targets on 24 July 2018.
• The Company has acquired an additional stake of 60.004% of • During the year under review, the Company has incorporated
the share capital of Dolvi Minerals and Metals Private Limited one wholly owned subsidiary, namely, JSW Retail Ltd.
(“DMMPL”), a subsidiary, for a cash consideration of `109 crores
on 23 October 2018. Pursuant to the acquisition of shares of For S. Srinivasan & Co.
DMMPL, DMMPL along with its wholly owned subsidiary Dolvi Company Secretaries
Coke Projects Limited (“DCPL”), have become wholly owned
subsidiaries of the Company. S. Srinivasan
• The Board of Directors of the Company at its meeting held Practicing Company Secretary
on 25 October 2018, considered and approved the Scheme FCS: 2286
of Amalgamation pursuant to sections 230 - 232 and other CP. No: 748
applicable provisions of the Companies Act, 2013, providing
for the merger of its wholly owned subsidiaries, Dolvi Minerals Place: Mumbai
and Metals Private Limited, Dolvi Coke Projects Limited, JSW Date: 10.05.2019
Steel Processing Centre Limited, and JSW Steel (Salav) Limited
This report is to be read with our letter of even date which is
with the Company. The merger is subject to regulatory approvals.
annexed and forms an integral part of this report.
1. Maintenance of secretarial records is the responsibility of the For S. Srinivasan & Co.
management of the Company. Our responsibility is to express Company Secretaries
an opinion on these secretarial records based on our audit.
2. We have followed the audit practices and processes as were S. Srinivasan
considered appropriate to obtain reasonable assurance about Practicing Company Secretary
the correctness of the contents of the secretarial records. FCS: 2286
The verification was done on test basis to ensure that correct CP. No: 748
facts are reflected in secretarial records. We believe that the
processes and practices, we followed, provide a reasonable Place: Mumbai
basis for our opinion. Date: 10.05.2019
4.
Wherever required, we have obtained the Management
representation about the compliance of laws, rules and
regulations and happening of events etc.
1 2 3 4 5 6 7 8
Amount spent on
the projects or
Cumulative
programs Sub-
Projects of Program Amount outlay expenditure
heads: (1) Direct
(1) Local area or other (budget) up to the
Sector in Which expenditure
Sr. (2) Specify the State project or reporting Amount spent Direct or through
CSR projects or activities the Initiatives on projects or
No and district where programs period (` In implementing agency *
were Covered programs (2)
projects or Programs wise Crores)
Overheads:
was undertaken (` In Crores) (as on 31st
(` In Crores)
March 2019)
(as on 31st March
2019)
1 Malnourishment project, Improving Around our DIZ 28 28 28 Direct / Implementing agency
Mid-day meals, Leprosy Living at Vijayanagar,
project, General Health & Conditions Dolvi, Vasind,
Cataract Camps, Drinking Salem, Tarapur.
Water Supply, Artificial Also at Thane,
Limb Replacement , Rural Palghar & Gadchiroli
Transformation Program etc.
2 School Infrastructure Promoting Around DIZ at 11 11 11 Direct / Implementing agency
development and Social Vijayanagar,
Enhancement of Quality Development Vasind, Dolvi,
education; Nehru Science Kalmeshwar, Tarapur.
Centre Lecture Series, Also at Uttarakhand
School for Differently-
Abled. Vocational
Training Institutes
1 2 3 4 5 6 7 8
Amount spent on
the projects or
Cumulative
programs Sub-
Projects of Program Amount outlay expenditure
heads: (1) Direct
(1) Local area or other (budget) up to the
Sector in Which expenditure
Sr. (2) Specify the State project or reporting Amount spent Direct or through
CSR projects or activities the Initiatives on projects or
No and district where programs period (` In implementing agency *
were Covered programs (2)
projects or Programs wise Crores)
Overheads:
was undertaken (` In Crores) (as on 31st
(` In Crores)
March 2019)
(as on 31st March
2019)
4 Watershed Management, Addressing Around our DIZ at 5 5 5 Direct / Implementing agency
Conservation of Natural Environmental Vijayanagar, Dolvi,
Resources, Tree Plantation, Issues Salem, Vasind,
School Sanitation Program, Kalmeshwar, Tarapur.
Garbage Management,
Construction of Individual
toilets, Clean Fuel Stoves
5 Conservation of Hampi, Preserving Around our DIZ at 1 1 1 Direct / Implementing agency
Restoration of various National Heritage Vijayanagar, Dolvi-
Historical Monuments Alibaug, Mumbai.
6 Sports Excellence Programs; Sports Training At various 5 5 5 Direct / Implementing agency
Domestic/ International locations.
Training / Medical support
7 Construction of community Rural Around our 4 4 4 Direct / Implementing agency
halls, village roads, Development DIZ at Salem,
drainages, bus shelters etc. Projects Tarapur, Vasind,
Dolvi, Vijayanagar.
TOTAL 63 63 63
* CSR activities have been carried out directly and through several other private, Non-Governmental Organisations and Charitable Institutions.
We hereby confirm that the implementation and monitoring of CSR Policy, is in compliance with CSR Objectives and Policy of the Company.
Sd/- Sd/-
Place: Mumbai SAJJAN JINDAL NIRUPAMA RAO
Date: May 24, 2019 CHAIRMAN & MANAGING DIRECTOR CHAIRPERSON CSR COMMITTEE
Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties
referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arm’s length transactions
under third proviso thereto
(a) Name(s) of the related party and nature of relationship JSW Steel Coated Products Limited (“JSW Steel Coated”) and JSW International
Trade Corp Pte Limited (“JITPL”)
(b) Nature of contracts / arrangements/ transactions Sale/purchase of steel products to/from JSW Coated, recovery/ reimbursement
of expenses, Interest income, sale of investments and Procurement of Iron
Ore, Coking Coal, Coke and other raw materials from JITPL
(c) Duration of the contracts/ arrangements/transactions Apr’18 to Mar’19
(d) Salient terms of the contracts or arrangements orValue of transaction with JSW Steel Coated amounted to `10,502 crores and
transactions including the value, if any procured raw material from JITPL amounted to `16,038 crores during FY 2018-19
(e) Date(s) of approval by the Board, if any For JITPL – The Board approved transaction on 27 October, 2016 and shareholders
approved this transaction through Postal Ballot by passing resolution dated
17 December, 2016.
For JSW Coated – Not applicable
1 Sajjan Jindal 59 BE (Mechanical) 04-Jul-1992 Chairman and Managing Director 702,697,511 37 Jindal Strips Ltd. (Jt. Managing Director)
2 Seshagiri Rao M V S 61 B.Com, CAIIB, AICWA, 01-Sep-1997 Jt. Managing Director and Group CFO 58,117,187 40 Nicholas Piramal (India) Ltd. (Sr.
LCS, DBF Vice President)
3 Dr. Vinod K Nowal 63 MBA,Ph.D 14-Feb-1984 Deputy Managing Director 44,895,330 40 K. M. Sugar Mills Ltd. (Factory Manager)
(Inventory Management)
4 Arun Maheshwari 49 MBA (Mareketing & 20-Feb-2003 Executive Vice President - Commercial 40,686,232 27 Maketi Rolling Mills Ltd. (Manager -
Finance) Business Development)
5 Jayant Acharya 56 BE (Chemical), MBA 01-Jul-1999 Director - Commercial & Marketing 36,179,953 36 Essar Steel Ltd. (Jt. General Manager)
(Marketing), MSC (Physics)
6 Gautam Chainani 56 B. Sc, MMS 01-Nov-2016 Group President - Human Resources 31,991,939 33 Ultratech Cement Limited ( Chief Human
Resource Officer & Corp. Communication )
7 Sandeep Gokhale 56 BE (Electrical), 25-Aug-2008 President - Business Development 28,224,759 33 Mumbai International Airport Pvt Ltd
MBA (Finance) (Director - Commercial)
8 Kaustubh Kulkarni 45 B. Com., MMS, CFA. 06-Nov-2017 Group Head- M&A & Strategic Financing 23,012,437 22 Standard Chartered Bank
(Managing Director)
9 Dheeraj Sinha 48 BE ( Electronics & 05-Jul-2016 Chief Information Officer - 22,044,782 26 Apollo Tyres Ltd. (Group Head
Communication ), Information Technology - CMS, IT & SCM)
MBA ( Finance )
10 Rajiv Bakshi 58 B. Com, LLB 04-Mar-2013 Sr. Vice President - Legal & Group 21,410,107 34 Godrej Industries Limited
Counsel General ( Executive Vice President - Legal )
(B) Employed for the part of the year and were in receipt of remuneration aggregating to not less than `8,50,000 per month
Nil
Notes:
CORPORATE OVERVIEW
1. Remuneration shown above includes Salary, Performance Reward / Special Allowance, House Rent Allowance / Perquisite for Accommodation, Leave Travel Allowance, Medical
Reimbursement, Perquisite for Car, Bonus, Variable Pay, Commission, monetary value of perquisites as per income tax rules and Company’s Contribution to Provident Fund, but does not
include Acturial Valuation of Leave Encashment, Company’s Contribution to Gratuity Fund.
2.
None of the employees is covered under Rule 5(3)(viii) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with Section 197
of the Companies Act , 2013.
ANNEXURE – F TO DIRECTORS’ REPORT
STATUTORY REPORTS
4. Mr. Sajjan Jindal is relative of Mrs. Savitri Devi Jindal, Chairperson emeritus of the Company.
195
Information as per Section 197 of the Companies Act, 2013 read with the rule 5 of the Companies (Appointment & Remuneration of Managerial Personnel ) Rules,
196
2014 and forming part of the Directors’ Report for the financial year ended 31st March, 2019.
Sr. Age in Date of commencement of Remuneration (Amt. Total Experience
Name Qualification Designation Previous Employment (Designation)
No. Years Employment in `) (No. of Years)
B(i) Employed throughout the year and were in receipt of remuneration of not less than `. 1.02 Crore per annum ( Other Than Top 10 )
1 Ajanta Chatterjee 51 B.A., Post 20-Oct-2015 Vice President - 11,324,248 20 Vodafone India Ltd. ( Associate Vice
4 Anil Kumar Singh 53 B. Sc ( Engineering ) 01-Dec-1994 Head - Project 18,089,899 31 B S B K Ltd. (General Manager)
Monitoring & Mining Ops
5 Ashok Kumar Aggarwal 60 B. Sc ( Engineering ) 02-Jun-1998 President - 20,501,684 33 Essar Steel Ltd. (Jt. General Manager)
Business Development
6 Ashok Venkatram Bharadwaj 60 BE ( Mechanical ), PGDM 20-Jul-2009 Senior Vice President 10,593,500 33 Mercedes Benz ( Head -
Business Sales )
197
Sr. Age in Date of commencement of Remuneration (Amt. Total Experience
198
Name Qualification Designation Previous Employment (Designation)
No. Years Employment in `) (No. of Years)
43 Sushil Nowal 52 B.Com., MBA (Mktg), EDM 01-Jan-1989 Senior Vice President - 12,127,896 32 Jindal Strips Ltd. ( Marketing Assistant )
Planning & Logistics
44 Vijaykumar Patidar 59 B.E.-Electricals 07-Jan-1992 Senior Vice 17,110,068 36 Electrotech Engg. (Partner)
President - Project
45 Vinay Shroff 55 BE- Chemical 22-Apr-2010 Executive Vice President 20,069,348 32 Reliance Industries Ltd. (Senior
1. Remuneration shown above includes Salary, Performance Reward / Special Allowance, House Rent Allowance / Perquisite for Accommodation, Leave Travel Allowance, Medical
Reimbursement, Perquisite for Car, Bonus, Variable Pay, Commission, monetary value of perquisites as per income tax rules and Company’s Contribution to Provident Fund, but does
not include Acturial Valuation of Leave Encashment, Company’s Contribution to Gratuity Fund.
2. None of the employees is covered under Rule 5(3)(viii) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with Section 197 of the Companies
Act, 2013.
3. The nature of employment in all cases is contractual except in case of Mr. Sajjan Jindal.
4. Mr. Sajjan Jindal is relative of Mrs. Savitri Devi Jindal, Chairperson emeritus of the Company.
CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS
DETAILS PERTAINING TO REMUNERATION AS REQUIRED UNDER SECTION 197(12) OF THE COMPANIES ACT, 2013 READ WITH
RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014
(i) The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary during the financial
year 2018-19, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the
financial year 2018-19 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance
of the Company are as under:
Ratio of remuneration
Remuneration of Director/ % Increase in
of each Director/ to
Sr. No. Name of Director/ KMP and Designation KMP for financial year Remuneration in the
median remuneration of
2018-19 (`in crores) Financial Year 2018-19
employees
1. Sajjan Jindal 70.30 10% 1052:1
Chairman & Managing Director
2. Seshagiri Rao MVS 5.81 10% 87:1
Joint Managing Director & Group CFO
3. Dr. Vinod Nowal 4.49 10% 67:1
Dy. Managing Director
4. Jayant Acharya 3.62 10% 54:1
Director ( Commercial & Marketing )
5. Rajeev Pai 1.98 15% N.A.
Chief Financial Officer
6. Lancy Varghese 0.74 8.5% N.A.
Company Secretary
(ii) In the Financial year, there was an increase of 8.37% in the median remuneration of employees;
(iii) There were 12,599 permanent employees on the rolls of Company as on March 31, 2019;
(iv) Average percentage increase made in the salaries of employees other than the managerial personnel in FY 2018-19 was 9.54%.
(v) The Key parameters for the variable component of remuneration in case of the Chairman and Managing Director is linked
with Company performance. In case of other key managerial personnel(s) the same is linked with Company performance and
Individual performance.
(vi) It is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and
other Employees.
No Director is related to any other Director on the Board in terms of the definition of “relative” as defined in Section 2(77)
of the Companies Act, 2013. None of the Directors on the Board are Independent Directors of more than seven listed companies and
Director in more than eight listed entities and none of the Whole-time Directors are Independent Directors of any listed company.
None of the Directors on the Board is a member of more than 10 committees or Chairperson of more than 5 committees (as
specified in Regulation 26 of SEBI (LODR) Regulations) across all the public Companies in which he/she is a Director. The necessary
disclosures regarding committee positions in other public companies have been made by the Directors.
The information stipulated under Part A of Schedule II of SEBI (LODR) Regulations is being made available to the Board.
T he details of composition of the Board as at 31.03.2019, the attendance record of the Directors at the Board Meetings held during
financial year 2018-19 and at the last Annual General Meeting (AGM), as also the number of Directorships, Committee Chairmanships
and Memberships held by them in other Public Companies, the names of other listed entities where they have Directorship and their
category of directorship in such listed entities, the number of Board Meetings and dates on which held and the number of shares and
convertible instruments held by non-executive directors are given here below:
No. of
No. of No. of No. of
Shares and
No. of No. of Directorships Chairmanship(s) Membership(s)
Date of Joining Attendance Convertible
Board Board in other of Committees of Committees
Category Name of Director Position the at last Instruments
Meetings meetings Indian Public in other Indian in other Indian
Board AGM held by Non-
held attended Limited Public Limited Public Limited
Executive
Cos. Cos. ** Cos., **
Directors
Executive Mr. Sajjan Jindal Chairman & Managing 15.03.1994 4 4 Yes 2 0 0 NA
Directors Director
Mr. Seshagiri Rao MVS Jt. Managing Director 06.04.1999 4 4 Yes 3 0 0 NA
&
Group CFO
Dr. Vinod Nowal Dy. Managing Director 30.04.2007 4 4 Yes 1 0 0 NA
Mr. Jayant Acharya Director (Commercial 07.05.2009 4 4 Yes 2 0 1 NA
& Marketing)
Independent Mr. Malay Mukherjee Director 29.07.2015 4 4 Yes 1 0 1 -
Non- Executive Dr. (Mrs.) Punita Director 28.10.2012 4 4 Yes 8 1 7 -
Kumar Sinha
Mr. Haigreve Director 30.09.2015 4 3 Yes 8 3 5 -
Khaitan -
Mr. Seturaman Director 27.07.2016 4 4 Yes 7 4 3 -
Mahalingam -
Nominee Mr. Hiroyuki Ogawa Nominee of JFE Steel 17.05.2017 4 4 Yes 0 0 0 -
Director Corporation, Japan
(Equity Investor &
Foreign Collaborator)
Part of the year
Independent Dr. Vijay Kelkar Director 20.01.2010 1* 1* Yes -- -- -- -
Non-Executive (ceased to be Director
w.e.f 24.07.2018)
Mr. K. Vijayaraghavan Director 16.06.2008 1* 1* No -- -- -- -
(ceased to be Director
w.e.f 24.07.2018)
Mr. Harsh C. Mariwala Director 25.07.2018 3* 2* NA# 3 0 1 -
Mrs. Nirupama Rao Director 25.07.2018 3* 2* NA# 2 0 0 -
Notes:
1. During the Financial Year 2018-19, four Board Meetings were held and the gap between two meetings did not exceed four months.
Board Meetings were held on 16.05.2018, 25.07.2018, 25.10.2018 & 06.02.2019.
2. * No. of Board Meetings indicated is with reference to date of join/cessation of the Director.
3. ** Only two Committees, namely, Audit Committee and Stakeholders’ Relationship Committee have been considered as per Regulation
26(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The names of other listed entities where the Directors have Directorship and their category of directorship in such listed entities:
2.4 Board Meetings, Board Committee Meetings and advance to the Directors. Additional meetings of the Board are
Procedures: held when deemed necessary to address the specific needs
of the Company. In case of business exigencies or urgency of
A. Institutionalised decision making process: matters, resolutions are passed by circulation.
The Board of Directors oversees the overall functioning
ii. The meetings are usually held at the Company’s Registered
of the Company. The Board provides and evaluates the
Office at JSW Centre, Bandra-Kurla Complex, Bandra (E),
strategic direction of the Company, management policies
Mumbai 400 051.
and their effectiveness and ensures that the long-term
interest of the stakeholders are being served. The Chairman All divisions/departments of the Company are advised to
and Managing Director is assisted by the Executive Directors/ schedule their work plans well in advance, with regard to
Senior Managerial Personnel in overseeing the functional matters requiring discussion/approval/decision at the Board/
matters of the Company. Committee meetings. All such matters are communicated
to the Company Secretary in advance so that the same can
The Board has constituted Thirteen Standing Committees,
be included in the Agenda for the Board/Committee Meetings.
namely, Audit Committee, Corporate Social Responsibility
Committee, Stakeholders Relationship Committee, Nomination iii. In addition to items which are mandated to be placed before
& Remuneration Committee, Project Review Committee, the Board for its noting and/ or approval, information is
Finance Committee, Risk Management Committee, Business provided on various significant issues.
Responsibility/Sustainability Reporting Committee, Hedging
iv.
The Board is given presentations covering Global Steel
Policy Review Committee, JSWSL ESOP Committee, Share
Scenario, Global/Indian Economy, Company’s Financials, Sales,
Allotment Committee, Share/ Debenture Transfer Committee
Production, Business Strategy, Subsidiary’s performance,
and JSWSL Code of Conduct Implementation Committee.
Competitor’s Performance and Risk Management practices
The Board constitutes additional functional committees, from
before taking on record the Quarterly/ Half Yearly/ Nine
time to time, depending on the business needs.
Monthly/ Annual financial results of the Company.
B.
Scheduling and selection of Agenda Items for Board Meetings: The Board is also provided with Audit Committee observations
i.
A minimum of four Board Meetings are held every year. on the Internal audit findings and matters required to be
Dates for the Board Meetings in the ensuing quarter are included in the Director’s Responsibility Statement to be
decided well in advance and communicated to the Directors. included in the Board’s report in terms of clause (c) of
The Agenda along with the explanatory notes are sent in sub-section 3 of Section 134 of the Companies Act, 2013.
C. Distribution of Board Agenda material: appointment letter is disclosed on the company’s website-
Agenda and Notes on Agenda are circulated to the Directors, http://www.jsw.in/investors/ investor-relations-steel.
in advance, in the defined Agenda format through an e-portal.
2.7 Meetings of Independent Directors:
All material information is incorporated in the Agenda papers
for facilitating meaningful and focused discussions at the The Independent Directors of the Company meet as and
meeting. Where it is not practical to attach any document to when required before the Board Meeting without the
the Agenda, the same is uploaded on the e-portal before the presence of Executive Directors or management personnel.
meeting with specific reference to this effect in the Agenda. These meetings are conducted in an informal and flexible
In special and exceptional circumstances, additional or manner to enable the Independent Directors to discuss
supplementary item(s) on the Agenda are considered. matters pertaining to the affairs of the Company and put forth
their views to the Chairman and Managing Director.
D. Recording Minutes of proceedings at Board and Committee
During the year under review, the Independent Directors met
Meetings:
on 25.10.2018 and 20.03.2019, inter alia, to discuss:
The Company Secretary records the minutes of the
proceedings of each Board and Committee meeting. •
Evaluation of the performance of Non-Independent
Draft minutes are circulated to all the members of the Board/ Directors and the Board of Directors as a whole;
Committee for their comments. The final minutes are entered •
Evaluation of the performance of the Chairman
in the Minutes Book within 30 days from conclusion of the of the Company, taking into account the views of the
meeting and are signed by the Chairman of the meeting/ Executive and Non-Executive Directors;
Chairman of the next meeting. A copy of the signed Minutes
certified by the Company Secretary are circulated to all • Evaluation of the quality, content and timelines of flow of
members within fifteen days after those are signed. information between the Management and the Board that
is necessary for the Board to effectively and reasonably
E. Post-Meeting Follow-up Mechanism: perform its duties.
The Company has an effective post meeting follow-up, review All the Independent Directors were present at the Meetings.
and reporting process mechanism for the decisions taken
by the Board/Committees. The important decisions taken at 2.8 Lead Independent Director:
the Board/ Committee meetings are communicated to the
Mr. Malay Mukherjee is the Lead Independent Director
concerned functional heads promptly. Action Taken Report appointed by the Board in its meeting held on 25.07.2018.
on decisions of the previous meeting(s) is placed at the
immediately succeeding meeting of the Board/ Committee for 2.9 Familiarization program for Independent Directors:
noting by the Board/ Committee members.
The Company believes that the Board be continuously
empowered with the knowledge of the latest developments
F. Compliance:
in the Company’s business and the external environment
While preparing the Agenda, Notes on Agenda, Minutes affecting the industry as a whole. To this end, the Directors
etc. of the meeting(s), adequate care is taken to ensure were given presentations on the global business environment,
adherence to all applicable laws and regulations as well as all business areas of the Company including
including the Companies Act, 2013, read with the Rules made business strategy, risks opportunities. Monthly updates on
thereunder and secretarial standards issued by the ICSI. performance/developments giving highlights of performance
of the Company during each month including the
2.5 Strategy Meet:
developments/ events having impact on the business
A strategy meet of the Board of Directors is generally held of the Company are also sent to all the Directors. The details
at appropriate intervals to formulate, evaluate and approve of familiarization programmes imparted to Independent
the business strategy of the Company. The Functional Directors is disclosed on the company’s website, http://
Heads give a brief presentation to the Board covering their www.jsw.in/investors/ investor-relations-steel.
respective areas of responsibility. The meeting focuses on
strategic goals, financial management policies, management 2.10 Fulfilment of the independence criteria by the
assurances and control aspects and the growth plan Independent Directors:
of the Company. Independent Directors are non-executive directors as defined
under Regulation 16(1)(b) of the SEBI (LODR) Regulations
2.6 Terms and conditions of appointment of
read with Section 149(6) of the Companies Act, 2013 along
Independent Directors:
with rules framed thereunder. Based on the declarations
The terms and conditions of appointment of Independent received from the Independent Directors, the Board of
Directors were set out in the appointment letter issued Directors has confirmed that they meet the criteria of
to the Director at the time of his/her appointment/ independence as mentioned under Regulation 16(1)(b) of the
re-appointment as an Independent Non-Executive Director SEBI (LODR) Regulations and that they are independent of
of the Company. The terms and conditions as mentioned in the the management. In terms of Regulation 25(8) of SEBI (LODR)
Regulations, the Independent Directors have confirmed that was carried out by the Nomination and Remuneration
they are not aware of any circumstance or situation which Committee. The performance evaluation of the Chairman
exists or may be reasonably anticipated that could impair or and the Non-Independent Directors was carried out by the
impact their ability to discharge their duties. Independent Directors.
2. Changes to any accounting policies and practices. Sl. No. Name of the Members Category
No. of Meetings
attended
3. Major accounting entries based on the exercise of 01. Mr. Seturaman Non-Executive 7/7
judgement by Management. Mahalingam (Chairman) Independent Director
02. Mr. Seshagiri Rao MVS Executive Director 5/6*
4.
Significant adjustments if any, arising out of
audit findings. 03. Mr. Malay Mukherjee Non-Executive 7/7
Independent Director
5. Compliance with respect to accounting standards, 04. Mr. Haigreve Khaitan Non-Executive 3/4**
listing agreements and legal. Independent Director
Note:- Mr. K. Vijayaraghavan, upon completion of his term as an Independent
6. requirements concerning financial statements. Director on the Board w.e.f 24.07.2018, ceased to be the Chairman and
7. Disclosure of any related party transactions. Member of the Audit Committee w.e.f 24.07.2018.
*inducted on the Committee on 16.05.2018
8. Modified opinion (s) in the draft audit report. **inducted on the Committee on 25.07.2018
c)
Re-commending to the Board, the appointment, The Dy. Managing Director, Director (Commercial & Marketing), Chief
re-appointment, remuneration and terms of appointment Financial Officer, Accounts Heads of each Unit, Sr. Vice President
of Auditors of the Company. (Internal Audit), Financial Controller, the Company Secretary
and the representatives of the Statutory Auditors attend the
d)
To review reports of the Management Auditors and Audit Committee meetings. The representatives of Management
Internal Auditors and discussion on any significant Auditors attend the Audit Committee Meeting whenever matters
findings and follow up there on. relating to management audit are considered. The representatives
e) Reviewing with the management, external and internal of the Cost Auditor attend the Audit Committee meeting when the
auditors, the adequacy of internal control systems, Cost Audit Report is tabled for discussion. The Company Secretary
and the Company’s statement on the same prior to is the Secretary of the Audit Committee.
endorsement by the Board. r. Seturaman Mahalingam, Chairman of the Audit Committee was
M
f)
Evaluation of the internal financial controls and risk present at the last Annual General Meeting held on 25.07.2018.
management systems.
4. Nomination & Remuneration Committee:
g)
To review the adequacy of internal audit function,
The Nomination & Remuneration Committee’s constitution
including the structure of the internal audit department,
and terms of reference are in compliance with the provisions
staffing and seniority of the official heading the
of the Companies Act, 2013 and Regulation 19 and Part D of
department, reporting structure coverage and frequency
the Schedule II of the SEBI (LODR) Regulations.
of internal audit.
The terms of reference of the Committee inter alia,
h) To approve transactions of the Company with related
include the following:
parties and subsequent modifications of the transactions
with related parties. • Identifying persons who are qualified to become directors
and who may be appointed in senior management in
i)
In addition, the powers and role of Audit Committee
accordance with the criteria laid down, recommend to
are as laid down under Regulation 18(3) and Part C of
the Board their appointment and removal and carry out
Schedule II of the SEBI (LODR) Regulations and Section
evaluation of every director’s performance.
177 of the Companies Act, 2013.
•
Formulating criteria for determining qualifications,
Seven meetings of the Audit Committee were held during the
positive attributes and independence of a director and
financial year 2018-19, as against the minimum requirement
recommending to the Board a policy, relating to the
of four meetings. The Committee meetings were held on
remuneration of the directors, key managerial personnel
15.05.2018, 18.06.2018, 24.07.2018, 20.09.2018, 24.10.2018,
and other employees.
05.02.2019 & 20.03.2019.
•
Formulating criteria for evaluation of Independent
The composition of the Committee as at 31.03.2019, name of
Directors and the Board.
members and Chairperson and the attendance of each member at
the Committee Meetings are as given below: • Devising a policy on Board diversity.
• Whether to extend or continue the term of appointment This is to be done on an annual basis for determining
of independent director on the basis of the report of whether to extend or continue the term of appointment
performance evaluation of Independent Directors. of the independent director.
• Recommend to the Board, all remuneration, in whatever The Evaluation process of Independent Directors and the
form, payable to Senior Management. Board will consist of two parts:
Three meetings of Nomination and Remuneration Committee - Board Member Self Evaluation ; and
were held on 16.05.2018, 25.07.2018 & 07.12.2018.
- Overall Board and Committee Evaluation.
The composition of the Nomination & Remuneration
In the Board Member Self Evaluation, each Board member
Committee as at 31.03.2019 and the attendance of each
is encouraged to be introspective about his/ her personal
member at the Committee Meetings are as given below:
contribution, performance, conduct as director with reference
No. of Meetings to a questionnaire provided to them. Copies of the evaluation
Sl. No. Name of the Member Category
attended forms as applicable will be distributed to each Board Member.
01. Mr. Seturaman Non-Executive 3/3
Board members shall complete the forms and return them
Mahalingam Independent Director
to the Company Secretary or Board nominee or the consultant,
02. Mr. Sajjan Jindal Executive Director 2/3
as may be informed.
03. Mr. Malay Mukherjee Non-Executive 2/2*
Independent Director The Company Secretary or Board nominee or the consultant
04. Mr. Harsh Charandas Non-Executive 1/1** will tabulate the Forms. The Tabulated Report would be sent to
Mariwala Independent Director
all Board Members for evaluation and if any director disagrees
05. Mrs. Nirupama Rao Non-Executive 1/1** with the self-evaluated results, he/she will suitably intimate
Independent Director the Chairman of the Board, else the same will be deemed to
Note:- Dr. Vijay Kelkar & Mr. K. Vijayaraghavan, upon completion of have been accepted.
their term as Independent Directors on the Board w.e.f 24.07.2018,
ceased to be the Chairman and Member of the Nomination &
The individually completed forms will be preserved
Remuneration Committee w.e.f 24.07.2018. by the Company Secretary and the Tabulated Report would be
* inducted on the committee on 24.07.2018
presented to the Board and NRC for evaluation.
**inducted on the committee on 25.07.2018
Apart from the above, the NRC will carry out an evaluation
Mr. Seturaman Mahalingam, Chairman of the Nomination of every director’s performance. For this purpose, the NRC
& Remuneration Committee was present at the last Annual would review the Tabulated Report. The NRC would provide
General Meeting held on 24.07.2018. feedback to the Board on its evaluation of every director’s
performance and based on such feedback, the Board will
4.1 Performance Evaluation Criteria for Independent
recommend appointments, re-appointments and removal of
Directors:
the non-performing Directors of the Company.
Board Evaluation Policy has been framed by the Nomination
and Remuneration Committee (NRC) and approved by the 4.2 Remuneration Policy and details of Remuneration
Board in its meeting held on 30.01.2015 and subsequently paid to Directors:
amended by the Board in its meeting held on 29.01.2016.
In determining the remuneration of the Directors, Key
This policy has been framed in compliance with the provisions Managerial Personnel (KMP) and other employees
of Section 178 (2), 134(3)(p) and other applicable provisions, if of the Company, a Remuneration Policy has been framed by
any, of the Companies Act, 2013 and Regulation 17(10), 19(4) the Nomination & Remuneration Committee and approved by
and Part D of Schedule II of the SEBI (LODR) Regulations, as the Board with the following broad objectives:
amended from time to time,
i. Ensuring that the level and composition of remuneration
The Company adopted the following criteria to carry out the is reasonable and sufficient to attract, retain
evaluation of Independent Directors, in terms of the provisions and motivate directors of the quality required to
of the Companies Act, 2013 and the SEBI (LODR) Regulations: run the company successfully.
• The Nomination and Remuneration Committee (NRC) shall ii.
Motivate KMP and Senior Management to achieve
carry out evaluation of every Director’s Performance. excellence in their performance.
• In addition, the evaluation of the Independent Directors iii. Relationship of remuneration to performance is clear and
shall be done by the entire Board, excluding the director meets appropriate performance benchmarks.
being evaluated, which shall include:
iv.
Ensuring that the remuneration to Directors, KMP
a) Performance of the directors; and and Senior Management involves a balance between
b)
Fulfilment of the independence criteria as specified fixed & incentive pay reflecting short and long-term
in 16(1) (b) of SEBI (LODR) Regulations and their performance objectives appropriate to the working
independence from the management. of the Company and its goals.
v. Retain, motivate and promote talent and to ensure long The present remuneration structure of Executive Directors
term sustainability of talented employees. comprises of salary, perquisites, allowances, performance
linked incentive, ESOPs and contribution to PF and Gratuity.
The full text of the remuneration policy is available at http://
www.jsw.in/investors/ investor-relations-steel. The Non-Executive Directors are paid remuneration by way of
commission and sitting fees. The commission payable to the
The Whole-time Directors compensation is based on the
Non-Executive Directors is based on the number of meetings
appraisal system wherein their individual goals are linked to
of the Board attended by them and their Chairmanship /
the organizational goals. The whole-time Directors are paid
Membership of Audit Committee during the year, subject
compensation as per the agreements entered into between
to an overall ceiling of 1% of the net profits approved by
them and the Company, subject to the approval of the Board
the Members. The Company pays sitting fees at the rate of
and of the members in General Meeting and such other
` 20,000/-for each meeting of the Board and sub-committees
approvals, as may be necessary.
attended by them.
The details of remuneration paid/payable to the Non-Executive Directors for the period 01.04.2018 to 31.03.2019 are as follows:
Name of the Director Commission paid/payable Sitting fees @ ` 20,000
Total (` in lakhs)
(2018-19) (` in Lakhs) per meeting (` in Lakhs)
Mr. Kannan Vijayaraghavan * 10.77 1.60 12.37
Dr. Vijay Kelkar * 10.45 0.40 10.85
Mr. Jayaraman N/Mrs. Gunjan Kinnu 31.00# 0.20 31.20
Mr. Hiroyuki Ogawa (JFE Steel Corporation Nominee Director) 34.00# 1.60# 35.60#
Dr. (Mrs) Punita Kumar Sinha 34.00 2.40 36.40
Mr. Malay Mukerjee 34.50 4.40 38.70
Mr. Haigreve Khaitan 34.50 1.40 35.90
Mr. Seturaman Mahalingam 34.84 4.40 39.24
Mr. Harsh C Mariwala 22.54 0.80 23.34
Mrs. Nirupama Rao 22.54 1.20 23.74
Total 269.14 18.40 287.54
*Ceased to be director.
# Payable to the respective Institutions/Companies they represent.
Note : None of the Non-Executive Directors hold any shares in the Company
The details of Remuneration paid / payable to the Whole-time Directors for the financial year 2018- 19 are as given below:
Name of Director and Designation Salary Perks (` in Profit linked Total Period of Notice Period
including crores) commission contract
Provident (` in crores)
Fund (` in
Crores)
Mr. Sajjan Jindal 11.81 1.30 57.16 70.27 From 07.07.2017 NA
Chairman & Managing Director to 06.07.2022
Mr. Seshagiri Rao MVS 5.57 0.24 -- 5.81 From 06.04.2017 3 months from
Jt. Managing Director & Group CFO to 05.04.2020 either side or
salary in lieu
thereof.
Dr. Vinod Nowal 4.31 0.18 -- 4.49 From 30.04.2017 3 months from
Dy. Managing Director to 29.04.2022 either side or
salary in lieu
thereof.
Mr. Jayant Acharya Director (Commercial & Marketing) 3.46 0.16 -- 3.62 From 07.05.2014 3 months from
to 06.05.2019 either side or
salary in lieu
thereof.
Note: The above figures exclude provision for leave encashment and contribution to the approved Group Gratuity Fund, which are actuarially determined for the
Company as a whole. There is no separate provision for payment of severance fees.
5. Stakeholders Relationship Committee: Address : JSW Centre, Bandra Kurla Complex, Bandra
The Stakeholders Relationship Committee comprises of 3 (East), Mumbai 400 051
Non-Executive Directors, all of whom are Independent Directors. Phone : 022-42861000
The Stakeholders Relationship Committee’s constitution Fax : 022-42863000
and terms of reference are in compliance with provisions Email : jswsl.investor@jsw.in
of the Companies Act, 2013 and Regulation 20 and Part D (B)
of Schedule VI of the SEBI (LODR) Regulations. Investor Grievance Redressal
Number of complaints received and resolved to the
The role of the Committee shall inter-alia include the following:
satisfaction of Shareholders / Investors during the year
1) Resolving the grievances of the security holders of the under review and their break-up is as under:
listed entity including complaints related to transfer/
No. of Shareholders’ Complaints received during the : 733
transmission of shares, non-receipt of annual report,
year ended 31.03.2019
non-receipt of declared dividends, issue of new/ Number not solved to the satisfaction : 0
duplicate certificates, general meetings etc. of Shareholders
No. of pending Complaints as on 31.03.2019 : 0
2) Review of measures taken for effective exercise of voting
rights by shareholders. None of the Complaints were pending for a period
exceeding 30 days. All requests for transfer of shares
3) Review of adherence to the service standards adopted
have been processed on time and there are no transfers
by the listed entity in respect of various services being
pending for more than 15 days.
rendered by the Registrar & Share Transfer Agent.
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
2017-18
2018-19
of the Companies Act, 2013 and Regulation 21 of the SEBI The Risk Management Committee, a sub-committee of the
(LODR) Regulations. Board has further constituted:
The terms of reference of the Committee are as follows: i. “Capex Risk Evaluation Committee” to evaluate the risks
associated with capex proposals including mergers
1. To periodically review risk assessment and minimisation
and acquisitions.
procedures to ensure that Executive Management
controls risk through means of a properly defined ii. Locational Committees namely (a) Corporate Locational
framework including cyber security. Committee (b) Vijayanagar Locational Committee (c)
Dolvi Locational Committee and (d) Salem Locational
2. To review major risks and proposed action plan.
Committee to further review risk assessment at
The Risk Management Committee met twice during the Location Level.
financial year 2018-19 on 18.06.2018 and 07.12.2018.
The composition of the Committee as on 31.03.2019 and 7 Other Major Committees of Directors:
the details of the meetings attended by the Members are In addition to the above referred Committees, which are
as given below: constituted pursuant to the Corporate Governance Code, the
No. of
Board has constituted the following major Committees of the
Sl. Name of the Board and delegated thereto powers and responsibilities with
Category Meetings
No. Members
attended respect to specific purposes. Time schedule for holding the
1 Mr. Malay Mukherjee Non-Executive 2/2 meetings of these Committees are finalized in consultation
(Chairman) Independent Director with the Committee Members:
2 Mr. Seshagiri Executive Director 2/2
Rao MVS,
(Member)
3 Dr. Vinod Nowal, Executive Director 1/2
Member
4 Mr. Jayant Acharya Executive Director 2/2
Member
5 Dr. (Mrs.) Punita Non-Executive 1/2
Kumar Sinha, Independent
Member Director
6 Mr. Harsh Non-Executive 1/1*
Charandas Mariwala, Independent
Member Director
Note:- Mr. K. Vijayaraghavan, upon completion of his term as an
Independent Director on the Board w.e.f 24.07.2018, ceased to be the
Member of the Risk Management Committee w.e.f 24.07.2018.
*inducted on the committee on 25.07.2018
5. FINANCE COMMITTEE:
Terms of reference of the Committee Composition Frequency of Meetings
1. To approve availing of credit / financial facilities 1. Mr. Seshagiri Rao MVS (Chairman) Executive Need based. Meetings were
of any description from Banks/ financial Director held on 24.04.2018, 24.05.2018,
Institutions/ Bodies Corporate within the limits 12.06.2018, 18.06.2018,
2. Dr. Vinod Nowal, (Member) Executive Director
approved by the Board. 05.07.2018, 24.07.2018,
2. To approve investments and dealings with any 3. Mr. Jayant Acharya, (Member) Executive 27.07.2018, 06.08.2018,
monies of the Company upon such security Director 27.08.2018, 28.08.2018,
or without security in such manner as the 10.09.2018, 15.11.2018, 03.12.2018,
committee may deem fit, and from time to time to 15.12.2018, 09.01.2019, 31.01.2019,
vary or realise such investments within the frame 06.02.2019, 15.03.2019 &
work of the guidelines laid down by the Board. 30.03.2019
2013 and Regulation 22 of the Securities Exchange Board 10. Means of Communication:
of India (Listing Obligations & Disclosure Requirements) Timely disclosure of consistent, comparable, relevant and
Regulations 2015, which is a mandatory requirement, has reliable information on corporate financial performance is at
been posted on the Company’s website http://www.jsw.in/ the core of good governance. towards this end:
investors/investor-relations-steel.
a) Quarterly/Half Yearly/Nine Monthly/ Annual Results: The
iv.
Subsidiary Monitoring Framework: All the Subsidiary Quarterly, Half Yearly, Nine Monthly and Annual Results
Companies of the Company are Board managed with of the Company are intimated to the Stock Exchanges
their Boards having the rights and obligations to manage immediately after they are approved by the Board.
such companies in the best interest of their stakeholders. Quarterly financial results were sent to the Shareholders’
As a majority shareholder, the Company nominates its through e-mail.
representatives on the Boards of subsidiary companies and
monitors the performance of such companies, inter alia, by b)
Publication of Quarterly/ Half Yearly/Nine Monthly/
the following means: Annual Results: The Quarterly, Half Yearly, Nine Monthly
and Annual Results of the Company are published in the
a) The financial statements along with the investments prescribed proforma within 48 hours of the conclusion of
made by the unlisted subsidiaries are placed before the the meeting of the Board in which they are considered,
Audit Committee and the Company’s Board, quarterly. at least in one English newspaper circulating in the
b) A copy of the Minutes of the Meetings of the Board of whole or substantially the whole of India and in one
Directors of the Company’s subsidiaries along with Vernacular newspaper of the State of Maharashtra where
Exception Reports and quarterly Compliance Certificates the Registered Office of the Company is situated.
issued by CEO/CFO/CS are tabled before the Company’s The quarterly financial results during the financial year
Board, quarterly. 2018-19 were published in The Financial Express and
c) A summary of the Minutes of the Meetings of the Board Navshakti Newspapers as detailed below:
of Directors of the Company’s subsidiaries are circulated
Quarter Date of Board Date of
to the Company’s Board, quarterly. (F. Y. 2018-19) Meeting publication
The Company does not have any material subsidiary c) Monthly production figures and other press releases:
whose net worth exceeds 20% of the consolidated To provide information to Investors, monthly production
net worth of the holding company in the immediately figures and other press releases are sent to the Stock
preceding accounting year or has generated 20% of the Exchanges as well as displayed on the Company’s
consolidated income of the Company during the previous website before it is released to the media.
financial year. However, a policy for determination of
d) Website: The Company’s website www.jsw.in
Material Subsidiaries has been formulated and has been
contains a separate dedicated section “Investors”
posted on the Company’s website http://www.jsw.in/
where information for shareholders is available.
investors/investor-relations-steel.
The Quarterly/Annual Financial Results, annual reports,
v. Internal Controls: The Company has a formal system of analysts presentations, investor forms, stock exchange
internal control testing which examines both the design information, shareholding pattern, corporate benefits,
effectiveness and operational effectiveness to ensure polices, investors’ contact details, etc., are posted on the
reliability of financial and operational information and all website in addition to the information stipulated under
statutory/regulatory compliances. The Company’s business Regulation 46 of the Securities and Exchange Board of
processes are on SAP- ERP platforms and has a strong India (Listing Obligations and Disclosure Requirements)
monitoring and reporting process resulting in financial Regulations, 2015. The latest official press releases are
discipline and accountability. also available on the website.
vi.
Compliance with Indian Accounting Standards: e) Presentations to Analysts:
The Company has followed Indian Accounting Standards
The Company arranged 4 Conference Calls with Analysts
(“Ind AS”) in the preparation of the Financial Statements for
on 16.05.2018, 25.07.2018, 25.10.2018 & 06.02.2019.
accounting periods beginning on or after 01.04.2016, as per
The presentation for the aforesaid were uploaded on the
the roadmap announced by Ministry of Corporate Affairs
Company’s website www.jsw.in before the Conference
Companies. The significant accounting policies which are
Call. The Presentations broadly covered the operational
consistently applied have been set out in the Notes to the
and financial performance of the Company and industry
Financial Statements.
outlook. The same are available on the Company’s website.
f) Filing with BSE “Listing Centre”: Pursuant to Regulation Companies (Management and Administration) Rules
10 (1) of the SEBI (LODR) Regulations, BSE has mandated 2014 and Regulation 44 of the SEBI (LODR) Regulation,
the Listing Centre as the “Electronic Platform” for filing 2015, members have been provided the facility to
all mandatory filings and any other information to exercise their right to vote at General Meetings by
be filed with the Stock Exchanges by Listed Entities. electronic means, through e-Voting Services provided by
BSE also mandated XBRL submissions for Financial Karvy Fintech Pvt Ltd.,
Results, Shareholding Pattern, Corporate Governance
Report, Reconciliation of Share Capital Audit Report & iv. CORPORATE IDENTITY NUMBER (CIN):
Voting Results. All the data relating to financial results, The CIN of the Company allotted by Ministry of Corporate
various quarterly/half yearly /annual submissions/ Affairs, Government of India is L27102MH1994PLC152925.
disclosure documents etc., have been filed Electronically/
XBRL mode with the Exchange on the “Listing Centre” v. LISTING ON STOCK EXCHANGES:
(http://listing.bseindia. com). The Company’s Equity Shares and 0.01% Cumulative
Redeemable Preference shares are listed on the following
g) NSE Electronic Application Processing System (NEAPS):
Stock Exchanges in India:
NEAPS is a web based application designed by NSE
for corporates. The Financial Results, Shareholding BSE Limited (BSE)
pattern and Corporate Governance Report, various
Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400 001
submissions/disclosure documents etc. are filed
electronically on NEAPS. National Stock Exchange of India Limited (NSE)
h) Annual Report: Annual Report containing, inter alia, Exchange Plaza, Bandra-Kurla Complex, Bandra East,
Audited Annual Accounts, Consolidated Financial Mumbai - 400051
Statements, Directors’ Report along with relevant
The following Secured Redeemable Non-Convertible
annexures, Business Responsibility/ Sustainability
Debentures of the Company are listed on the BSE:
Report, Auditor’s Report and other important information
is circulated to members and others entitled thereto. Sl. Face Value (as on
Description
The Management Discussion and Analysis (MD&A) Report No. issue date)
forms part of the Annual Report. 1. 10.34% Secured Redeemable Non- `10 Lakhs eDach
convertible Debentures
i) Chairman’s Communiqué: Printed copy of the Chairman’s
2. 10.60% Secured Redeemable Non- `10 Lakhs each
Speech is distributed to all the shareholders at the convertible Debentures
Annual General Meetings. The same is also placed on the
3. 10.60% Secured Redeemable Non- `10 Lakhs each
website of the Company. convertible Debentures
4. 10.02% Secured Redeemable Non- `10 Lakhs each
11. General Shareholders Information: convertible Debentures
i. Annual General Meeting: 5. 10.02% Secured Redeemable Non- `10 Lakhs each
convertible Debentures
Date and Time : 25.07.2019 at 11.00 a.m.
6. 10.40% Secured Redeemable Non- `10 Lakhs each
Venue: Y B Chavan Auditorium,
convertible Debentures
General Jagannathrao
Bhonsle Marg, Nariman 7. 10.60% Secured Redeemable Non- `10 Lakhs each
Point, Mumbai 400 021, convertible Debentures.
Maharashtra 8. 9.72% Secured Redeemable Non- `10 Lakhs each
Dates of Book closure: 10.07.2019 to 12.07.2019 convertible Debentures.
(both days inclusive
The Company has paid Annual Listing Fees as
Dividend Payment date: 29.07. 2019
applicable, to the BSE and the NSE for the financial years
ii. Financial Calendar 2019-20: 2018-19 and 2019-20.
First quarterly results : July 2019 The 4.75% Fixed Rate Senior Unsecured Foreign Currency
Second quarterly results : October 2019 Denominated Notes due 2019 (FCNs) aggregating
to US $ 500 million and the 5.25% Fixed Rate Senior
Third quarterly results : January, 2020
Unsecured Foreign Currency Denominated Notes due
Annual results for the year ending on May, 2020 2022 (FCNs) aggregating to US $ 500 million issued
31.03.2020 :
by the Company in the International Market have been
Annual General Meeting for the Year 2019 : July, 2020
listed on the Singapore Exchange Securities Trading
iii. E-VOTING: Limited (the “SGX-ST”), 2 Shenton Way,#19-00 SGX Centre
1,Singapore 068804. The one time Listing fees has been
Pursuant to the provisions of Section 108
paid by the Company to the SGX
of the Companies Act, 2013 read with Rule 20 of the
Equity : INE019A01038
Preference : INE019A04024
(0.01% Cumulative redeemable preference shares)
INE019A07258 – 10.02% NCDs of `10 Lakhs each
INE019A07266 – 10.02% NCDs of `10 Lakhs each
INE019A07324 – 10.40% NCDs of `10 Lakhs each
INE019A07357 – 10.60% NCDs of `10 Lakhs each
Debentures:
INE019A07407 – 9.72% NCDs of `10 Lakhs each
INE019A07183 – 10.60% NCDs of `10 Lakhs each
INE019A07241 – 10.34% NCDs of `10 Lakhs each
INE019A07167 – 10.60% NCDs of `10 Lakhs each
FCNs: XS1133588233
XS1586341981
Debenture Trustees:
Asian Building, Ground Floor, 17th R. Kamani Marg, Ballard Estate, Mumbai – 400001
viii. Performance of Share Price in comparison to S&P xi. Registrar & Share Transfer Agents:
BSE 100: Karvy Fintech Private Limited
Karvy Selenium Tower B, Plot 31-32,
425
400
375
12,000.00
Gachibowli, Financial District Nanakramguda,
11,500.00
350
325 11,000.00 Hyderabad – 500 032
300 10,500.00
275
250 10,000.00
Tel. No. 040 67161500
250
200 9,500.00 Fax No. 040 23001153
175 9,000.00
150
125 8,500.00 E-mil: einward.ris@karvy.com
100 8,000.00
Website: www.karvyFintech.com
Apr-18
May-18
Jun-18
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
xii. Share Transfer/Transmission System:
JSW Share Price S&P BSE 100
Requests for Transfer/Transmission of Shares held in physical
form can be lodged with Karvy Fintech Private Limited at
the above mentioned address. The requests are normally
processed within 15 days of receipt of the documents, if
IX Performance of Share Price in comparison to Nifty 50: documents are found in order. Shares under objection are
returned within two weeks.
12000 SEBI has vide its circular dated 7 January, 2010 made it
400
350 11500 mandatory to furnish a copy of PAN Card in the following
300 10000 cases for transmission of shares in physical form:
250
200 10500
150
a)
Deletion of name of the deceased shareholder(s),
10000
100 where the shares are held in the name of two or
50 9500
more shareholders.
Apr-18
May-18
Jun-18
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
b)
Transmission of shares to the legal heir(s), where
JSW Share Price Nifty 50
deceased shareholder was the sole holder.
As on 31.03.2019 As on 31.03.2018
Category
No. of Holders No. of Shares % of holding No. of Holders No. of Shares % of holding
Promoters 45 1031105450 42.66 42 1009155180 41.75
Promoters Trust 6 600 0.00 6 600 0.00
NRI 9419 30451920 1.26 9266 30865014 1.28
FII 519 449123255 18.58 542 480062536 19.86
OCB 2 9660 0.00 2 9660 0.00
FBC 3 362584730 15.00 3 362584730 15.00
IFI 8 21570492 0.89 7 8369980 0.35
IMF 112 47376216 1.96 86 58562246 2.42
Banks 37 453140 0.02 29 240117 0.01
Employees 675 367385 0.02 744 381242 0.02
Bodies Corporate 2462 202814438 8.39 2473 199207352 8.24
Public 582280 221996483 9.18 588499 225104609 9.31
Trust 22 17249515 0.71 19 313622 0.01
HUF 5743 19003731 0.79 5679 19305731 0.80
Employees Welfare Trust 0 0 0.00 1 10988860 0.45
NBFC 24 61960 0.00 15 25845 0.00
IEPF 1 13049760 0.54 1 12027406 0.50
AIF 1 995 0.00 1 15000 0.00
Transit A/C 1 710 0.00 1 710 0.00
Total 601360 2417220440 100.00 607416 2417220440 100.00
Under Section 124 (5) of the Companies Act, 2013, dividends that are unclaimed / un-paid for a period of seven years, are to be
transferred statutorily to the Investor Education and Protection Fund (IEPF) administered by the Central Government. To ensure
maximum disbursement of unclaimed dividend, the Company sends reminders to the concerned investors at appropriate intervals.
The status of dividend remaining unclaimed is given hereunder:
Pursuant to Section 124 (5) of the Companies Act, 2013, the unpaid dividends that are due for transfer to the Investor Education and
Protection Fund are as follows:
Members who have not encashed their dividend warrants shall issue a refund sanction order with the approval
pertaining to the aforesaid years may approach the Company or of the Competent Authority and shall either credit the
its Registrar, for obtaining payments thereof atleast 20 days shares which are lying with depository participant in
before they are due for transfer to the said fund. IEPF suspense account name of the company) to the
demat account of the claimant to the extent of the
c) Transfer of Shares to Investor Education and claimant’s entitlement.
Protection Fund:
Pursuant to the provisions of the Companies Act, 2013 read d) Unclaimed shares:
with the second proviso to Rule 6 of Investor Education and
As per Clause 5A(II) of the erstwhile Listing
Protection Fund Authority (Accounting, Audit, transfer and Agreement, the Company after sending three reminders on
refund) Rules, 2016 (“the rules”), all shares in respect of June 23, 2011, August 25, 2011 and October 31, 2011 to the
which dividend has not been en-cashed or claimed by the registered address of the shareholders of the Company and
shareholders for seven consecutive years or more should be on 23.01.2014, 21.03.2014 and 02.05.2014 to the registered
transferred by the Company to the Demat Account opened by address of the shareholders of the erstwhile JSW Ispat Steel
the IEPF Authority within a period of 30 days from which the Limited who became shareholders of the Company consequent
shares become due to transfer to the IEPF. to the merger, requesting for correct particulars to dispatch
the undelivered share certificates, for shares issued in
Accordingly, 10,24,994 equity shares pertaining to 9203
physical form which remained unclaimed, transferred
folios in respect of which dividend has been not been paid or
7,07,359 shares to a dedicated demat account styled as
claimed for seven consecutive years or more by shareholders,
“Unclaimed Suspense Account” opened with Stock Holding
has been transferred to the designated demat account of
Corporation of India.
the IEPF Authority maintained with CDSL through SBI Cap
Securities during December 2018. Any corporate benefits in terms of securities accruing on
aforesaid shares viz. bonus shares, split, etc., shall be
Refund process guidelines to facilitate the Claimants refund
credited to the “Unclaimed Suspense Account” duly opened
by IEPF Authority:
with Stock Holding Corporation of India Limited and dividend to
1)
Any person, whose shares, unclaimed dividend, sale the “Unclaimed Suspense Account” opened with Vijaya Bank.
proceeds of fractional shares, redemption proceeds
As and when the rightful owner of such shares
of preference shares, etc. has been transferred to the
approaches the Company at a later date, the Company shall
IEPF, may claim the shares under proviso to sub-section
credit the shares lying in the “Unclaimed Suspense Account”
(6) of section 124 or apply for refund under clause (a)
to the rightful owner to the extent of his/her entitlement after
of sub-section (3) of section 125 or under proviso to
proper verification of the identity of the rightful owner.
sub-section (3) of section 125, as the case may be, to
the Authority by making an application in Form IEPF- 5 As per Schedule V (F) of the SEBI (LODR
available online on website www.iepf.gov.in. Regulations, the Company reports the following details in
respect of equity shares and Preference Shares lying in the
2) Fill the required fields of the Form and submit the duly
suspense account:
filled form by following the instructions given in the
upload link on the website. On successful uploading JSW Steel Ltd - Equity Shares Unclaimed Suspense
of Form on MCA Portal, an acknowledgement will be Account:
generated indicating the SRN. Please note the SRN for
Number
future tracking of the form. Number of of Equity
Description
Share Holders Shares of `
3) Applicant has to send the printout of form IEPF-5, copy 1/- each
of challan and other documents as prescribed in the Aggregate Number of shareholders and the 13981 1773290
Form IEPF-5 to the Nodal Officer of the Company at its outstanding shares in the suspense account
registered office or RTA i.e. Karvy Fintech Pvt Limited in an lying as on 01.04.2018.
envelope marked “claim for refund from IEPF Authority” Number of Shareholders who approached 99 31620
for initiating the verification for claim. issuer for transfer of shares from suspense
account during the year ended 31.3.2019
4) The Company shall within fifteen days of receipt of claim
Number of shareholders to whom shares 99 31620
form, send a verification report to the IEPF Authority
were transferred from suspense account
in the format specified by the Authority along with all during the year ended 31.3.2019
documents submitted by the claimant.
Number of unclaimed shares transferred to 1230 161290
5) After verification of the entitlement of the claimant- (a) to IEPF on 26.12.2018
the amount claimed, the Authority and then the Drawing Aggregate number of shareholders and the 12652 1580380
and Disbursement Officer of the Authority shall present a outstanding shares in the suspense account
bill to the Pay and Accounts Office for e- payment as per lying as at year ended 31.3.2019
the guidelines (b) to the shares claimed, the Authority
JSW Steel Ltd - Preference Shares Unclaimed Suspense Account: Disclosure Requirements) Regulations, 2015, except in case
Description
Number of Share Number of of transmission or transposition, requests for effecting
Holders Preference Shares transfer of securities of listed companies shall not be
Aggregate Number of shareholders 25058 2701370
processed unless the securities are held in dematerialised
and the outstanding shares in
form with a Depository.
the suspense account lying
as on 01.04.2018. In view of the above, the Physical Share Purchase Scheme
Number of Shareholders who 58 6056 has been discontinued w.e.f 31.03.2019.
approached issuer for transfer of
shares from suspense account g) National Electronic Clearing Service (NECS):
during the year ended 31.3.2019 As per the directive from Securities and Exchange Board of
Number of shareholders to whom 58 6056 India dated March 21, 2013, companies whose securities are
shares were transferred from listed on the Stock Exchanges shall use any Reserve Bank of
suspense account during the year India (RBI) approved electronic mode of payment such as ECS
ended 31.3.2019 [LECS(Local ECS) / RECS (Regional ECS)/NECS (National ECS)]/
Aggregate number of shareholders 25000 2695314 NEFT etc., for making cash payments to investors.
and the outstanding shares in the
suspense account lying as at year The Company will remit the dividend payment through National
ended 31.3.2019 Electronic Clearing Service (NECS) to the shareholders having
accounts with Branches of Banks covered under CBS (Core
The voting rights on the shares outstanding in the suspense
Banking Solution).
accounts as on March 31, 2019 shall remain frozen till the rightful
owner of such shares claims the shares. Equity Shareholders holding shares in physical form, who
wish to avail the NECS facility, may send their NECS mandate
e) De-materialisation of Shares and Liquidity: in the format attached to the Company’s R & T Agents, in the
The Company has arrangements with both National Securities event they have not done so earlier. Equity Shareholders
Depository Limited (NSDL) and Central Depository Services holding shares in electronic mode may furnish their new
(India) Limited (CDSL) for demat facility. 2392130240 Equity Bank Account Number allotted to them by their bank after
Shares aggregating to 98.96% of the total Equity Capital is implementation of CBS, alongwith a photocopy of a cheque
held in dematerialised form as on 31.03.2019 of which 94.73% pertaining to the concerned account, or the NECS mandate to
(2289815226 Equity Shares) of total equity capital is held their Depositary Participant (DP), at the earliest.
in NSDL & 4.23% (102315014 Equity Shares) of total equity
The Company in compliance with SEBI circular dated 20th
capital is held in CDSL as on 31.3.2019.
April 2018, had sent 3 reminder letters on 04.06.2018,18.08.2018
Dematerialisation of Shares & 25.10.2018 to Shareholders holding physical shares seeking
their Pan, Bank Details and email address. The shareholders
who have not yet responded with their details are requested
to furnish the same to Karvy Fintech Pvt. Limited immediately.
Members who hold shares in physical form are requested k) Commodity Price Risk or Foreign Exchange Risk and
to fill in the Registration form which can be obtained Hedging Activities:
from Company’s Registrar Karvy Fintech Private Limited or A comprehensive financial and commodity risk management
downloaded from the Company’s website www.jsw.in under program supports the achievement of an organisation’s
the section “Investors”, and register the same with the objectives by enabling the identification and evaluation of
Company’s Registrar. risks, setting acceptable risk thresholds, identifying and
mapping controls against these risks and implementing
i) Nomination Facility:
policies and procedures to manage and monitor the risks.
Pursuant to the provisions of the Companies Act, 2013,
members are entitled to make nominations in respect of The Company has in place a Board approved policy which
shares held by them. Members holding shares in physical establishes the financial and commodity risk management
form and intending to make/change the nomination in respect framework and defines the procedures and controls for the
of their shares in the Company may submit their requests effective management of the Company’s risks that arise due
in Form No. 2B to the Company’s Registrar, Karvy Fintech to imports of raw material, capex, debt servicing and exports
Private Limited. Members holding shares in electronic form of finished steel.
may submit their nomination requests to their respective Currency Hedging and Commodity Hedging is as guided
Depository Participants directly. Form No. 2B can be obtained by Risk management policy approved by Board and the
from Company’s Registrar, Karvy Fintech Private Limited or same is reviewed by Board committee of independent
downloaded from the Company’s website www. jsw.in under directors each quarter.
the section ‘Investors’
Fitch
Particulars Rating Month Rating during FY 2019 Previous Rating
Long term Issuer Default Rating February 2019 BB; Stable BB; Stable
Senior Unsecured Notes BB; Stable BB; Stable
o) Total fees for all services paid by the Company and its b) For Securities held in Demat form
subsidiaries on a consolidated basis, to the statutory auditor The investor’s Depository Participant and/ or Karvy
and all entities in the network firm/network entity of which Fintech Private Limited
the statutory auditor is a part:
c) JSW Steel Limited – Investor Relation Centre
`in crores
Statutory audit fees (including limited reviews) 9
JSW Centre, Bandra-Kurla Complex, Bandra (East),
Audit related fees (certification, tax audit & capital 3 Mumbai 400 051, Phone No. 022 – 42861000
market transctions) Fax No. 022 – 42863000
Other services 1
Out of pocket expenses # 2. Institutional Investors:
Total 13
Mr. Pritesh Vinay, Vice President (Capital Markets and
Investor Relations),JSW Centre, Bandra-Kurla Complex,
p) Sexual Harassment of Women at Workplace
Bandra (E), Mumbai 400 051
(Prevention, Prohibition and Redressal) Act, 2013:
Tel. No. 022 – 42861000
a) No. of complaints filed during the financial year 2018-19 : 1 Fax No. 022 – 42863000
b)
No. of complaints disposed of during the financial
3. Designated exclusive email-id for Investor servicing: jswsl.
year 2018-19: 1
investor@jsw.in
c) No. of complaints pending as on 31.03.2019 : 0
4. Toll Free Number of R & T Agent’s exclusive call Centre:
q) Registered Office: 1-800-3454001
JSW Centre, Bandra-Kurla Complex, Bandra (East), 5. Web-based Query Redressal System
Mumbai 400 051. Web-based Query Redressal System has been extended
by the Registrars and Share Transfer Agent for redressal
r) Plant Locations:
of Shareholders’ queries. The Shareholder can visit http://
Vijayanagar : P.O. Vidyanagar, Toranagallu Village, Sandur
karisma.karvy. com and click on “investors” option for query
Taluk, Dist. Bellary, Karnataka - 583 275 registration after free identity registration.
Dolvi : Geetapuram, Dolvi
Village, Pen Taluk, Dist. After logging in, Shareholders can submit their query in the
Raigad, Maharashtra - 402 107 “QUERIES” option provided on the website, which would give
Salem : Pottaneri, M Kalipatti Village, Mecheri Post, Mettur
the grievance registration number. For accessing the status/
Taluk, Salem Dist., Tamil Nadu - 636 453. response to their query, the same number can be used at
the option “VIEW REPLY” after 24 hours. The Shareholders
can continue to put additional queries relating to the case till
they are satisfied.
that no personnel have been denied access to the in its meeting held on 28.1.2013 to bring it in line with
Audit Committee. the requirements of Business responsibility reporting.
JSW’s policy on human rights applies to all its businesses
The Company Secretary has been appointed as
processes and is a part of its commitment to ethical and
the Compliance Officer and is responsible for
socially responsible behaviour across its value chain.
adherence to the Code.
JSW contributes to the fulfilment of human rights
c) Reconciliation of Share Capital Audit Report : through compliance with local human rights legislation
Reconciliation of Share Capital Audit Report in terms of wherever it has operations, as well as through its
SEBI Circular No. CIR/MRD/ DP/30/2010 dated 06.09.2010 policies, programs and grievance redressal mechanism.
and SEBI Directive no. D&CC/FITTC/CIR-16/2002 dated JSW upholds international human rights standards,
31.12.2002, confirming that the total issued capital does not condone human rights abuses and creates &
of the Company is in agreement with the total number nurtures a working environment where human rights are
of shares in physical form and the total number of respected without prejudice.
dematerialised shares held with National Securities
Depository Limited and Central Depository Services Compliance Certificate by Auditors:
(India) Limited, is placed before the Board on a quarterly The Company has obtained a certificate from the Statutory Auditors
basis and is also submitted to the Stock Exchanges regarding compliance of conditions of Corporate Governance as
where the shares of the Company are listed. stipulated under Schedule V (E) of the SEBI (LODR) Regulations
which is annexed herewith.
d) Internal Checks and Balances:
Wide use of technology in the Company’s financial Compliance Certificate by Practicing Company Secretary
reporting processes ensures robustness and integrity. The Company has obtained a certificate from the Secretarial
The Company deploys a robust system of internal Auditor pursuant to the provisions of Regulation 34(3) read with
controls to allow optimal use and protection of assets, Schedule V Para C Clause (10)(i) of the SEBI (LODR) Regulations
facilitate accurate and timely compilation of financial which is annexed herewith.
statements and management reports and ensure
compliance with statutory laws, regulations and Declaration Affirming Compliance of Code of Conduct
Company policies. The Company has both external and As provided under Regulation 26(3) of the Securities and Exchange
internal audit systems in place. Auditors have access to Board of India (Listing Obligations & Disclosure Requirements)
all records and information of the Company. The Board Regulations, 2015, the Board Members and the Senior Management
and the management periodically review the findings and Personnel have confirmed compliance with the Code of Conduct
recommendations of the auditors and take necessary for the year ended 31.03.2019.
corrective actions whenever necessary. The Board
For JSW Steel Limited
recognises the work of the auditors as an independent
check on the information received from the management Sd/-
on the operations and performance of the Company. Place: Mumbai Seshagiri Rao MVS
Date : 24.05. 2019 Jt. Managing Director & Group CFO
e) Legal Compliance of the Company’s
Subsidiaries:
Periodical Management audit ensures that the Company‘s
Subsidiaries conducts its business with high standards
of legal, statutory and regulatory compliances. As per the
report of the Management Auditors, there has been no
material non-compliance with the applicable statutory
requirements by the Company and its subsidiaries.
CERTIFICATE PURSUANT TO THE PROVISIONS OF REGULATION 34(3) AND SCHEDULE V PARA C CLAUSE (10)(i) OF
THE SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015)
To,
The Members of
JSW Steel Limited,
JSW Centre,
Bandra Kurla Complex,
Bandra (East),
Mumbai - 400051
We have examined the relevant registers, records, forms, returns and disclosures received from the Directors of JSW Steel Limited
having CIN L27102MH1994PLC152925 and having registered office at JSW Centre Bandra Kurla Complex, Bandra (East) Mumbai, 400051
(hereinafter referred to as ‘the Company’), produced before us by the Company for the purpose of issuing this Certificate, in accordance
with Regulation 34(3) read with Schedule V Para-C Sub clause 10(i) of the Securities Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations,2015.
In our opinion and to the best of our information and according to the verifications (including Directors Identification Number (DIN) status
at the portal www.mca.gov.in) as considered necessary and explanations furnished to us by the Company & its officers, we hereby
certify that none of the Directors on the Board of the Company as stated below for the Financial Year ending on 31st March, 2019 have
been debarred or disqualified from being appointed or continuing as Directors of companies by the Securities and Exchange Board of
India, Ministry of Corporate Affairs, or any such other Statutory Authority.
Ensuring the eligibility of for the appointment/ continuity of every Director on the Board is the responsibility of the management
of the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is neither an assurance
as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs
of the Company.
Sd/-
S. Srinivasan
Practicing Company Secretary
FCS: 2286
CP. No.: 748
Place: Mumbai
Date: May 24, 2019
Independent Auditor’s Report on compliance with the conditions of Corporate Governance as per provisions
of Chapter IV of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, as amended
The Members of JSW Steel Limited 6. We have complied with the relevant applicable requirements
1.
The Corporate Governance Report prepared by JSW Steel of the Standard on Quality Control (SQC) 1, Quality Control
Limited (hereinafter the “Company”), contains details as for Firms that Perform Audits and Reviews of Historical
specified in regulations 17 to 27, clauses (b) to (i) of sub – Financial Information, and Other Assurance and Related
regulation (2) of regulation 46 and para C, D, and E of Schedule Services Engagements.
V of the Securities and Exchange Board of India (Listing 7. The procedures selected depend on the auditor’s judgement,
Obligations and Disclosure Requirements) Regulations, 2015, including the assessment of the risks associated in
as amended (“the Listing Regulations”) (‘Applicable criteria’) compliance of the Corporate Governance Report with
for the year ended March 31, 2019. This report is as required the applicable criteria. Summary of key procedures
by the Company for annual submission to the Stock exchanges performed include:
and to be sent to the shareholders of the Company..
i.
Read and understood the information prepared
Management’s Responsibility by the Company and included in its Corporate
2. The preparation of the Corporate Governance Report is the Governance Report;
responsibility of the Management of the Company including ii. Obtained and verified that the composition of the Board
the preparation and maintenance of all relevant supporting of Directors with respect to executive and non-executive
records and documents. This responsibility also includes the directors has been met throughout the reporting period;
design, implementation and maintenance of internal control
relevant to the preparation and presentation of the Corporate iii. Obtained and read the Register of Directors as on March 31,
Governance Report. 2019 and verified that atleast one woman director was
on the Board of Directors throughout the year;
3. The Management along with the Board of Directors are also
responsible for ensuring that the Company complies with iv. Obtained and read the minutes of the following meetings
the conditions of Corporate Governance as stipulated in the held from April 01, 2018 to March 31, 2019:
Listing Regulations, issued by the Securities and Exchange (a) Board of Directors;
Board of India.
(b)
Audit Committee;
Auditor’s Responsibility
(c) Annual General Meeting (AGM);
4.
Pursuant to the requirements of the Listing Regulations,
our responsibility is to provide a reasonable assurance in (d) Nomination and Remuneration Committee;
the form of an opinion whether, the Company has complied (e) Stakeholders Relationship Committee;
with conditions of Corporate Governance as specified in the
Listing Regulations. (f) Risk Management Committee
meeting where in such related party transactions have 11. This report is addressed to and provided to the members
been pre-approved by the audit committee. of the Company solely for the purpose of enabling it to
comply with its obligations under the Listing Regulations
viii. Performed necessary inquiries with the management
with reference to compliance with the relevant regulations
and also obtained necessary specific representations
of Corporate Governance and should not be used by any
from the management.
other person or for any other purpose. Accordingly, we do not
8.
The above-mentioned procedures include examining accept or assume any liability or any duty of care or for any
evidence supporting the particulars in the Corporate other purpose or to any other party to whom it is shown or into
Governance Report on a test basis. Further, our scope of work whose hands it may come without our prior consent in writing.
under this report did not involve us performing audit tests We have no responsibility to update this report for events and
for the purposes of expressing an opinion on the fairness or circumstances occurring after the date of this report.
accuracy of any of the financial information or the financial
statements of the Company taken as a whole.
For S R B C & CO LLP
Opinion Chartered Accountants
9.
Based on the procedures performed by us, as referred ICAI Firm Registration Number: 324982E/E300003
in paragraph 7 above, and according to the information
and explanations given to us we are of the opinion per Vikram Mehta
that the Company has complied with the conditions of Partner
Corporate Governance as specified in the Listing Regulations, Membership Number: 105938
as applicable for the year ended March 31, 2019, referred to in UDIN: 19105938AAAAAF1667
paragraph 4 above.
Place of Signature: Mumbai
Other matters and Restriction on Use Date: May 24, 2019
10. This report is neither an assurance as to the future viability
of the Company nor the efficiency or effectiveness with which
the management has conducted the affairs of the Company.
To the Members of JSW Steel Limited these requirements and the Code of Ethics. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a
Report on the Audit of the Standalone Ind AS Financial Statements
basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
Key Audit Matters
We have audited the accompanying standalone Ind AS financial
statements of JSW Steel Limited (“the Company”), which comprise the Key audit matters are those matters that, in our professional judgment,
Balance sheet as at March 31, 2019, the Statement of Profit and Loss, were of most significance in our audit of the standalone Ind AS financial
including the statement of Other Comprehensive Income, the Cash Flow statements for the financial year ended March 31, 2019. These matters
Statement and the Statement of Changes in Equity for the year then were addressed in the context of our audit of the standalone Ind AS
ended, and notes to the financial statements, including a summary of financial statements as a whole, and in forming our opinion thereon, and
significant accounting policies and other explanatory information. we do not provide a separate opinion on these matters. For each matter
below, our description of how our audit addressed the matter is provided
In our opinion and to the best of our information and according to the
in that context.
explanations given to us, the aforesaid standalone Ind AS financial
statements give the information required by the Companies Act, 2013, We have determined the matters described below to be the key
as amended (“the Act”) in the manner so required and give a true and fair audit matters to be communicated in our report. We have fulfilled the
view in conformity with the accounting principles generally accepted in responsibilities described in the Auditor’s responsibilities for the audit
India, of the state of affairs of the Company as at March 31, 2019, its profit of the standalone Ind AS financial statements section of our report,
including other comprehensive income its cash flows and the changes in including in relation to these matters. Accordingly, our audit included
equity for the year ended on that date. the performance of procedures designed to respond to our assessment
of the risks of material misstatement of the standalone Ind AS financial
Basis for Opinion
statements. The results of our audit procedures, including the procedures
We conducted our audit of the standalone Ind AS financial statements performed to address the matters below, provide the basis for our audit
in accordance with the Standards on Auditing (SAs), as specified under opinion on the accompanying standalone Ind AS financial statements.
section 143(10) of the Act. Our responsibilities under those Standards
are further described in the ‘Auditor’s Responsibilities for the Audit of
the Standalone Ind AS Financial Statements’ section of our report. We
are independent of the Company in accordance with the ‘Code of Ethics’
issued by the Institute of Chartered Accountants of India together with
the ethical requirements that are relevant to our audit of the financial
statements under the provisions of the Act and the Rules thereunder,
and we have fulfilled our other ethical responsibilities in accordance with
Key audit matters How our audit addressed the key audit matter
Recoverability of investments in and loans / advances given to certain subsidiaries and a Joint venture and financial guarantees
given on behalf of certain subsidiaries (as described in note 50 of the standalone Ind AS financial statements)
The Company has investments in certain subsidiaries Our audit procedures included the following:
and a joint venture with a carrying value of ` 1,018
• We have obtained and read management’s assessment for
crores. Further, Company has also provided loans and/
identification of indicators of impairment.
or guarantees to or on behalf of these subsidiaries and
the joint venture amounting to ` 8,632 crores. These • We performed test of controls over impairment process through
subsidiaries and joint venture, have either been incurring inspection of evidence of performance of these controls.
losses or the investments made by them in the step down
• Assessed the impairment model prepared by the management and
subsidiaries have been making losses.
the assumptions used, with particular attention to the following:
Assessment of the recoverable amount of the investments
- Benchmarking or assessing key market related assumptions
in and loans/advances including interest thereon given
used in the impairment models, including discount rates, long
to these subsidiaries and a joint venture and financial
term growth rate, risk free rate of return, weight average cost of
guarantees given on behalf of these subsidiaries has
capital, Production schedule against external data.
been identified as a key audit matter due to:
- assessing the cash flow forecasts through analysis of actual
• Significance of the carrying amount of these
past performance and comparison to previous forecasts;
balances.
- testing the mathematical accuracy and performing sensitivity
• The assessment requires management to make
analyses of the models;
significant estimates concerning the estimated
future cash flows, qualitative assessments of the - understanding the commercial prospects of the assets/
status of the project and its future depending on projects, and comparison of assumptions with external data
balance work to be performed or approvals to be sources;
received, associated discount rates and growth rates
• We assessed the competence, capabilities and objectivity of the
based on management’s view of future business
experts used by the Management in the process of evaluating
prospects.
impairment models.
• Changes to any of these assumptions could lead
• We assessed the compliance of the disclosures made in note 50
to material changes in the estimated recoverable
of the standalone Ind AS financial statements with accounting
amount, impacting both potential impairment
standards.
charges and also potential reversals of impairment
taken in prior years.
Key audit matters How our audit addressed the key audit matter
Recoverability of VAT deferral under the GST regime (as described in note 29 of the standalone Ind AS financial statements)
The Company’s units at Dolvi in Maharashtra and Our audit procedures included the following:
Vijayanagar in Karnataka are eligible and have been
• We obtained an understanding, evaluated the design and tested
availing for interest free VAT deferral loan as an incentive
operating effectiveness of the controls related to the recognition of
under the incentive schemes notified by the State of
government grants and income accruing therefrom, including the
Maharashtra and Karnataka.
controls in respect of measurement of the grants.
The Company has recognised income in relation these
• We have read eligibility certificates in respect of VAT deferral
grants being the difference between the net present
incentives available to Company.
value of these interest free loans granted to the Company
and the nominal value of such loans to the extent of SGST • We have read the notification issued by the Government of
collected by the Company in respect of sales eligible for Maharashtra and Government of Karnataka stating eligibility of VAT
such grants, in accordance with notifications issued by deferral under the GST regime.
the State of Maharashtra and Karnataka.
• We have read Government Resolution dated 20 December 2018
The State Government of Maharashtra (‘GoM’) vide its and revision made on 8 March 2019, issued by Government of
Government Resolution dated 20 December 2018, revised Maharashtra in respect of modalities for sanction and disbursement
on 8 March 2019, has issued the modalities for sanction of Incentives under GST regime.
and disbursement of Incentives under GST regime,
• We have read circular dated 26 February 2019 issued by the State
which includes certain additional conditions for eligibility
Government of Karnataka in respect of guidelines for certification of
and prescribed a new formula for determination of the
the eligible incentive amount.
incentives.
• Read the legal opinion obtained by the management for assessing
The State Government of Karnataka vide its circular dated
the impact of new eligibility conditions and formula for determination
26 February 2019, has issued guidelines for certification
incentives based on latest Government Resolution issued by GoM
of the eligible incentive amount.
• We involved specialists to assist us in reviewing and evaluating the
The amount of incentive recognized during the year
management’s assessment of latest Government Resolution issued
amounts to ` 1,111 crores and cumulative balance of these
by GoM.
receivables amount to ` 1,806 crores.
• We have tested the calculation of incentives accrued for the year
We considered VAT deferral incentive as a Key audit matter
ended March 31, 2019.
due to:
Key audit matters How our audit addressed the key audit matter
Accuracy and completeness of disclosure of related party transactions and compliance with the provisions of Companies Act 2013
and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (‘SEBI (LODR) 2015’) (as described
in note 43 of the standalone Ind AS financial statements)
We identified the accuracy and completeness of Our procedures in relation to the disclosure of related party transactions
disclosure of related party transactions as set out in included:
respective notes to the standalone Ind AS financial
• Obtaining an understanding of the Company’s policies and
statements as a key audit matter due to:
procedures in respect of the capturing of related party transactions
• the significance of transactions with related parties and how management ensures all transactions and balances
during the year ended March 31, 2019. with related parties have been disclosed in the standalone Ind AS
financial statements.
• Related party transactions are subject to the
compliance requirement under the Companies Act • Obtaining an understanding of the Company’s policies and
2013 and SEBI (LODR) 2015. procedures in respect of evaluating arms-length pricing and
approval process by the audit committee and the board of directors.
Key audit matters How our audit addressed the key audit matter
Claims and exposures relating to taxation and litigation (as described in note 44 of the standalone Ind AS financial statements)
The Company has disclosed in Note 44 contingent Our audit procedures included the following:
liabilities of ` 3,015 crores in respect of disputed claims/
• Understanding and assessing the internal control environment
levies under various tax and legal matters and ` 2,160
relating to the identification, recognition and measurement
crores towards Claims related to Forest development tax/
of provisions for disputes, potential claims and litigation, and
fee. In addition, the Company has assessed several claims
contingent liabilities.
as ‘Remote’ and hence are not required to be disclosed as
contingent liabilities. • Obtaining the details of legal and tax disputed matters and
evaluation made by the management and assessed management’s
Taxation and litigation exposures have been identified as
position through discussions on both the probability of success in
a key audit matter due to:
significant cases, and the magnitude of any potential loss.
• Significance of these amounts and large number of
• Read external legal opinions (where considered necessary) and
disputed matters with various authorities.
other evidence to corroborate management’s assessment of the risk
• Significant judgement and assumptions required profile in respect of legal claims.
by management in assessing the exposure of each
• We involved tax specialists to assist us in evaluating tax positions
case to evaluate whether there is a need to set up a
taken by management.
provision and measurement of exposures as well as
the disclosure of contingent liabilities. • We assessed the relevant disclosures made in the standalone Ind
AS financial statements for compliance in accordance with the
We focused on this matter because of the potential
requirements of Ind AS 37.
financial impact on the financial statements.
Additionally, the treatment of taxation and litigation
cases require significant judgement due to the
complexity of the cases, timescales for resolution
with the accounting principles generally accepted in India, including
and involvement of various authorities.
the Indian Accounting Standards (Ind AS) specified under section 133 of
Information Other than the Financial Statements and Auditor’s Report the Act read with the Companies (Indian Accounting Standards) Rules,
Thereon 2015, as amended. This responsibility also includes maintenance of
The Company’s Board of Directors is responsible for the other information. adequate accounting records in accordance with the provisions of the
The other information comprises the information included in the Annual Act for safeguarding of the assets of the Company and for preventing
Report, but does not include the standalone Ind AS financial statements and detecting frauds and other irregularities; selection and application
and our auditor’s report thereon. of appropriate accounting policies; making judgments and estimates
that are reasonable and prudent; and the design, implementation and
Our opinion on the standalone Ind AS financial statements does not cover
maintenance of adequate internal financial controls, that were operating
the other information and we do not express any form of assurance
effectively for ensuring the accuracy and completeness of the accounting
conclusion thereon.
records, relevant to the preparation and presentation of the standalone
In connection with our audit of the standalone Ind AS financial statements, Ind AS financial statements that give a true and fair view and are free from
our responsibility is to read the other information and, in doing so, material misstatement, whether due to fraud or error.
consider whether such other information is materially inconsistent
In preparing the standalone Ind AS financial statements, management is
with the financial statements or our knowledge obtained in the audit
responsible for assessing the Company’s ability to continue as a going
or otherwise appears to be materially misstated. If, based on the work
concern, disclosing, as applicable, matters related to going concern
we have performed, we conclude that there is a material misstatement
and using the going concern basis of accounting unless management
of this other information, we are required to report that fact. We have
either intends to liquidate the Company or to cease operations, or has no
nothing to report in this regard.
realistic alternative but to do so.
Responsibilities of Management for the Standalone Ind AS Financial
Those Board of Directors are also responsible for overseeing the
Statements
Company’s financial reporting process.
The Company’s Board of Directors is responsible for the matters stated
Auditor’s Responsibilities for the Audit of the Standalone Ind AS
in section 134(5) of the Act with respect to the preparation of these
Financial Statements
standalone Ind AS financial statements that give a true and fair view of the
financial position, financial performance including other comprehensive
income, cash flows and changes in equity of the Company in accordance
Our objectives are to obtain reasonable assurance about whether the fair presentation.
standalone Ind AS financial statements as a whole are free from material
We communicate with those charged with governance regarding, among
misstatement, whether due to fraud or error, and to issue an auditor’s
other matters, the planned scope and timing of the audit and significant
report that includes our opinion. Reasonable assurance is a high level of
audit findings, including any significant deficiencies in internal control
assurance, but is not a guarantee that an audit conducted in accordance
that we identify during our audit.
with SAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material We also provide those charged with governance with a statement
if, individually or in the aggregate, they could reasonably be expected to that we have complied with relevant ethical requirements regarding
influence the economic decisions of users taken on the basis of these independence, and to communicate with them all relationships and other
standalone Ind AS financial statements. matters that may reasonably be thought to bear on our independence,
and where applicable, related safeguards.
As part of an audit in accordance with SAs, we exercise professional
judgment and maintain professional skepticism throughout the audit. We From the matters communicated with those charged with governance,
also: we determine those matters that were of most significance in the audit
of the standalone Ind AS financial statements for the financial year ended
• Identify and assess the risks of material misstatement of the
March 31, 2019 and are therefore the key audit matters. We describe these
standalone Ind AS financial statements, whether due to fraud or
matters in our auditor’s report unless law or regulation precludes public
error, design and perform audit procedures responsive to those
disclosure about the matter or when, in extremely rare circumstances,
risks, and obtain audit evidence that is sufficient and appropriate to
we determine that a matter should not be communicated in our report
provide a basis for our opinion. The risk of not detecting a material
because the adverse consequences of doing so would reasonably be
misstatement resulting from fraud is higher than for one resulting
expected to outweigh the public interest benefits of such communication.
from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control. Report on Other Legal and Regulatory Requirements
• Obtain an understanding of internal control relevant to the audit 1. As required by the Companies (Auditor’s Report) Order, 2016 (“the
in order to design audit procedures that are appropriate in the Order”), issued by the Central Government of India in terms of sub-
circumstances. Under section 143(3)(i) of the Act, we are also section (11) of section 143 of the Act, we give in the “Annexure 1” a
responsible for expressing our opinion on whether the Company statement on the matters specified in paragraphs 3 and 4 of the
has adequate internal financial controls system in place and the Order.
operating effectiveness of such controls. 2. As required by Section 143(3) of the Act, we report that:
• Evaluate the appropriateness of accounting policies used and the (a) We have sought and obtained all the information and
reasonableness of accounting estimates and related disclosures explanations which to the best of our knowledge and belief
made by management. were necessary for the purposes of our audit;
• Conclude on the appropriateness of management’s use of the going (b) In our opinion, proper books of account as required by law
concern basis of accounting and, based on the audit evidence have been kept by the Company so far as it appears from our
obtained, whether a material uncertainty exists related to events examination of those books;
or conditions that may cast significant doubt on the Company’s
ability to continue as a going concern. If we conclude that a material (c) The Balance Sheet, the Statement of Profit and Loss including
uncertainty exists, we are required to draw attention in our auditor’s the Statement of Other Comprehensive Income, the Cash Flow
report to the related disclosures in the financial statements or, Statement and Statement of Changes in Equity dealt with by
if such disclosures are inadequate, to modify our opinion. Our this Report are in agreement with the books of account;
conclusions are based on the audit evidence obtained up to the (d) In our opinion, the aforesaid standalone Ind AS financial
date of our auditor’s report. However, future events or conditions statements comply with the Accounting Standards specified
may cause the Company to cease to continue as a going concern. under Section 133 of the Act, read with Companies (Indian
• Evaluate the overall presentation, structure and content of the Accounting Standards) Rules, 2015, as amended;
standalone Ind AS financial statements, including the disclosures, (e) On the basis of the written representations received from the
and whether the standalone Ind AS financial statements represent directors as on March 31, 2019 taken on record by the Board of
the underlying transactions and events in a manner that achieves Directors, none of the directors is disqualified as on March 31,
2019 from being appointed as a director in terms of Section 164 litigations on its financial position in its standalone Ind AS
(2) of the Act; financial statements – Refer Note 44 to the standalone
Ind AS financial statements;
(f) With respect to the adequacy of the internal financial controls
over financial reporting of the Company with reference to these ii. The Company did not have any long-term contracts
standalone Ind AS financial statements and the operating including derivative contracts for which there were any
effectiveness of such controls, refer to our separate Report in material foreseeable losses;
“Annexure 2” to this report;
iii. There has been no delay in transferring amounts,
(g) In our opinion, the managerial remuneration for the year ended required to be transferred, to the Investor Education and
March 31, 2019 has been paid / provided by the Company to its Protection Fund by the Company
directors in accordance with the provisions of section 197 read
For S R B C & CO LLP
with Schedule V to the Act;
Chartered Accountants
(h) With respect to the other matters to be included in the Auditor’s ICAI Firm Registration Number: 324982E/E300003
Report in accordance with Rule 11 of the Companies (Audit and
Auditors) Rules, 2014, as amended in our opinion and to the per VIKRAM MEHTA
best of our information and according to the explanations Partner
given to us: Membership Number: 105938
i. The Company has disclosed the impact of pending
Place of Signature: Mumbai
Date: 24 May 2019
Annexure 1
Annexure 1 referred to in paragraph 1 under the heading “Report parties covered in the register maintained under section
on Other Legal and Regulatory Requirements” of our report of 189 of the Companies Act, 2013 (‘the Act’). Accordingly, the
even date provisions of clause 3(iii) (a), (b) and (c) of the Order are not
applicable to the Company and hence not commented upon.
(i) (a) The Company has maintained proper records showing
full particulars, including quantitative details and (iv) In our opinion and according to the information and
situation of fixed assets. explanations given to us, provisions of section 185 and 186
of the Act in respect of loans to directors including entities
(b) All fixed assets were physically verified by the
in which they are interested and in respect of loans and
management in the previous year in accordance with
advances given, investments made and, guarantees, and
a planned programme of verifying them once in three
securities given have been complied with by the Company.
years which, in our opinion, is reasonable having
regard to the size of the Company and the nature of its (v) The Company has not accepted any deposits within the
assets. No material discrepancies were noticed on such meaning of Sections 73 to 76 of the Act and the Companies
verification. (Acceptance of Deposits) Rules, 2014 (as amended).
Accordingly, the provisions of clause 3(v) of the Order are not
(c) According to the information and explanations given
applicable.
by the management, the title deeds of immovable
properties, included in property, plant and equipment (vi) We have broadly reviewed the books of account maintained
are held in the name of the Company except for by the Company pursuant to the rules made by the Central
Government for the maintenance of cost records under
i. leasehold land aggregating to ` 67 crores wherein
section 148(1) of the Act, related to the manufacture of its
the lease deed has expired. As explained to us, the
products, and are of the opinion that prima facie, the specified
Company is in the process of converting the title
accounts and records have been made and maintained. We
into freehold as per the lease cum sale agreement.
have not, however, made a detailed examination of the same.
ii. freehold land aggregating to ` 9 crores as noted
(vii) (a) The Company is generally regular in depositing with
below for which title deeds were not available with
appropriate authorities undisputed statutory dues
the Company and hence we are unable to comment
including provident fund, employees’ state insurance,
on the same
income-tax, sales-tax, service tax, duty of custom, duty
Nature of immovable Total Number As at of excise, value added tax, goods and service tax, cess
Property of Cases March 31, 2019 and other statutory dues applicable to it.
(` in Crores) (b) According to the information and explanations given
Gross Net to us, no undisputed amounts payable in respect of
Block Block provident fund, employees’ state insurance, income-tax,
Land located at 12 9 9 service tax, sales-tax, duty of custom, duty of excise,
Maharashtra value added tax, goods and service tax, cess and other
statutory dues were outstanding, at the year end, for
(ii) The inventory has been physically verified by the management a period of more than six months from the date they
during the year. In our opinion, the frequency of verification is became payable.
reasonable. No material discrepancies were noticed on such
physical verification. Inventories lying with third parties have (c) According to the records of the Company, the dues
been confirmed by them and no material discrepancies were outstanding of income-tax, sales- tax, wealth-tax,
noticed in respect of such confirmations. service tax, customs duty, excise duty, value added tax
and cess on account of any dispute, are as follows:
(iii) According to the information and explanations given to us, the
Company has not granted any loans, secured or unsecured
to companies, firms, Limited Liability Partnerships or other
The above table does not include cases decided in favour of the applicable and the details have been disclosed in the notes to the
Company for which the department has preferred an appeal at financial statements, as required by the applicable accounting
higher levels amounting to ` 616 crores. standards.
(viii) In our opinion and according to the information and explanations (xiv) According to the information and explanations given to us
given by the management, the Company has not defaulted in and on an overall examination of the balance sheet, the Company
repayment of loans or borrowing to a financial institution, bank or has not made any preferential allotment or private placement of
government or dues to debenture holders. shares or fully or partly convertible debentures during the year
under review and hence, reporting requirements under clause
(ix) In our opinion and according to the information and explanations
3(xiv) are not applicable to the Company and, not commented
given by the management, the Company has utilized the monies
upon.
raised by way of term loans for the purposes for which they were
raised. According to the information and explanations given by the (xv) According to the information and explanations given by the
management, the Company has not raised any money way of initial management, the Company has not entered into any non-cash
public offer / further public offer (including debt instruments) and transactions with directors or persons connected with him as
hence not commented upon. referred to in section 192 of the Act.
(x) Based upon the audit procedures performed for the purpose (xvi) According to the information and explanations given to us,
of reporting the true and fair view of the standalone Ind AS financial the provisions of section 45-IA of the Reserve Bank of India Act,
statements and according to the information and explanations 1934 are not applicable to the Company.
given by the management, we report that no fraud by the Company
or no fraud on the Company by the officers and employees of the
Company has been noticed or reported during the year. For S R B C & CO LLP
Chartered Accountants
(xi) According to the information and explanations given by
ICAI Firm Registration Number: 324982E/E300003
the management, the managerial remuneration has been paid /
provided in accordance with the requisite approvals mandated by
per VIKRAM MEHTA
the provisions of section 197 read with Schedule V to the Act.
Partner
(xii) In our opinion, the Company is not a Nidhi company. Therefore, Membership Number: 105938
the provisions of clause 3(xii) of the order are not applicable to the
Company and hence not commented upon. Place of Signature: Mumbai
Date: 24 May 2019
(xiii) According to the information and explanations given by
the management, transactions with the related parties are
in compliance with section 177 and 188 of the Act wherever
Annexure 2
Annexure 2 to the Independent Auditor’s Report of even date on and evaluating the design and operating effectiveness of internal
the standalone Ind AS financial statements of JSW Steel Limited control based on the assessed risk. The procedures selected
depend on the auditor’s judgement, including the assessment of
Report on the Internal Financial Controls under Clause (i) of Sub-
the risks of material misstatement of the financial statements,
section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
whether due to fraud or error.
We have audited the internal financial controls over financial
We believe that the audit evidence we have obtained is sufficient
reporting of JSW Steel Limited (“the Company”) as of March
and appropriate to provide a basis for our audit opinion on the
31, 2019 in conjunction with our audit of the standalone Ind AS
internal financial controls over financial reporting with reference
financial statements of the Company for the year ended on that
to these standalone Ind AS financial statements.
date.
Meaning of Internal Financial Controls Over Financial Reporting
Management’s Responsibility for Internal Financial Controls
With Reference to these standalone Ind AS financial statements
The Company’s Management is responsible for establishing and
A company’s internal financial control over financial reporting
maintaining internal financial controls based on the internal
with reference to these standalone Ind AS financial statements
control over financial reporting criteria established by the
is a process designed to provide reasonable assurance regarding
Company considering the essential components of internal
the reliability of financial reporting and the preparation of financial
control stated in the Guidance Note on Audit of Internal Financial
statements for external purposes in accordance with generally
Controls Over Financial Reporting issued by the Institute of
accepted accounting principles. A company’s internal financial
Chartered Accountants of India. These responsibilities include the
control over financial reporting with reference to these standalone
design, implementation and maintenance of adequate internal
Ind AS financial statements includes those policies and
financial controls that were operating effectively for ensuring the
procedures that (1) pertain to the maintenance of records that, in
orderly and efficient conduct of its business, including adherence
reasonable detail, accurately and fairly reflect the transactions and
to the Company’s policies, the safeguarding of its assets, the
dispositions of the assets of the Company; (2) provide reasonable
prevention and detection of frauds and errors, the accuracy
assurance that transactions are recorded as necessary to
and completeness of the accounting records, and the timely
permit preparation of financial statements in accordance with
preparation of reliable financial information, as required under the
generally accepted accounting principles, and that receipts and
Companies Act, 2013.
expenditures of the Company are being made only in accordance
Auditor’s Responsibility with authorisations of management and directors of the Company;
and (3) provide reasonable assurance regarding prevention or
Our responsibility is to express an opinion on the Company’s
timely detection of unauthorised acquisition, use, or disposition
internal financial controls over financial reporting with reference
of the Company’s assets that could have a material effect on the
to these standalone Ind AS financial statements based on our
financial statements.
audit. We conducted our audit in accordance with the Guidance
Note on Audit of Internal Financial Controls Over Financial Inherent Limitations of Internal Financial Controls Over Financial
Reporting (the “Guidance Note”) and the Standards on Auditing Reporting With Reference to these standalone Ind AS financial
as specified under section 143 (10) of the Companies Act, 2013, statements
to the extent applicable to an audit of internal financial controls
Because of the inherent limitations of internal financial controls
and, both issued by the Institute of Chartered Accountants of
over financial reporting with reference to these standalone Ind
India. Those Standards and the Guidance Note require that we
AS financial statements, including the possibility of collusion
comply with ethical requirements and plan and perform the audit
or improper management override of controls, material
to obtain reasonable assurance about whether adequate internal
misstatements due to error or fraud may occur and not be detected.
financial controls over financial reporting with reference to these
Also, projections of any evaluation of the internal financial controls
standalone Ind AS financial statements was established and
over financial reporting with reference to these standalone Ind AS
maintained and if such controls operated effectively in all material
financial statements to future periods are subject to the risk that
respects.
the internal financial control over financial reporting with reference
Our audit involves performing procedures to obtain audit evidence to these standalone Ind AS financial statements may become
about the adequacy of the internal financial controls over financial inadequate because of changes in conditions, or that the degree
reporting with reference to these standalone Ind AS financial of compliance with the policies or procedures may deteriorate.
statements and their operating effectiveness. Our audit of internal
Opinion
financial controls over financial reporting included obtaining an
understanding of internal financial controls over financial reporting In our opinion, the Company has, in all material respects, adequate
with reference to these standalone Ind AS financial statements, internal financial controls over financial reporting with reference
assessing the risk that a material weakness exists, and testing to these standalone Ind AS financial statements and such internal
BALANCE SHEET
AS AT 31 MARCH 2019
` in crores
Notes As at As at
31 March 2019 31 March 2018
I ASSETS
Non-current assets
(a) Property, plant and equipment 4 49,245 49,503
(b) Capital work-in-progress 5 9,577 3,071
(c) Intangible assets 6 172 65
(d) Intangible assets under development 344 321
(e) Investments in subsidiaries, associates and joint ventures 7 4,853 3,848
(f) Financial assets
(i) Investments 8 1,424 1,030
(ii) Loans 9 7,674 5,165
(iii) Other financial assets 10 45 746
(g) Current tax assets (net) 195 250
(h) Other non-current assets 11 3,364 2,299
Total non-current assets 76,893 66,298
Current assets
(a) Inventories 12 10,599 10,082
(b) Financial assets
(i) Trade receivables 13 6,746 4,692
(ii) Cash and cash equivalents 14 5,258 451
(iii) Bank balances other than (ii) above 15 422 150
(iv) Loans 9 136 158
(v) Derivative Assets 16 228 147
(vi) Other financial assets 10 2,621 503
(c) Other current assets 11 1,999 3,070
Total current assets 28,009 19,253
Total Assets 104,902 85,551
II EQUITY AND LIABILITIES
Equity
(a) Equity share capital 17 301 302
(b) Other equity 18 34,861 27,605
Total equity 35,162 27,907
Non-current liabilities
(a) Financial liabilities
(i) Borrowings 19 26,748 29,551
(ii) Other financial liabilities 20 1,015 698
(b) Provisions 21 226 115
(c) Deferred tax liabilities(net) 22 3,270 2,071
(d) Other non-current liabilities 23 4,083 4
Total non-current liabilities 35,342 32,439
Current liabilities
(a) Financial liabilities
(i) Borrowings 24 5,368 2,172
(ii) Trade payables 25
(a) Total outstanding, dues of micro and small enterprises 30 10
(b) Total outstanding, dues of creditors other than micro and 13,022 13,978
small enterprises
(iii) Derivative Liabilities 26 332 90
(iv) Other financial liabilities 27 13,786 7,111
(b) Provisions 21 52 111
(c) Other current liabilities 28 1,616 1,381
(d) Current tax liabilities(net) 192 352
Total current liabilities 34,398 25,205
Total liabilities 69,740 57,644
Total equity and liabilities 104,902 85,551
` in crores
Notes For the year ended For the year ended
31 March 2019 31 March 2018*
I Revenue from operations 29 76,727 67,723
II Other income 30 519 213
III Total income (I + II) 77,246 67,936
IV Expenses:
Cost of materials consumed 39,589 35,995
Purchases of stock-in-trade 498 1,063
Changes in inventories of finished goods and work-in-progress 31 (188) 412
Employee benefits expense 32 1,400 1,260
Finance costs 33 3,708 3,591
Depreciation and amortization expense 34 3,397 3,054
Excise duty expense - 1,259
Other expenses 35 17,025 13,993
Total expenses 65,429 60,627
V Profit before exceptional items and tax (III-IV) 11,817 7,309
VI Exceptional items (refer note 49) - 234
VII Profit before tax (V-VI) 11,817 7,075
VIII Tax expense/(benefit): 22
Current tax 2,348 1,578
Deferred tax 1,210 872
3,558 2,450
IX Profit for the year (VII-VIII) 8,259 4,625
X Other comprehensive income
A i) Items that will not be reclassified to profit or loss
(a) Re-measurements of the defined benefit plans (15) (3)
(b) Equity instruments through other comprehensive income 4 82
ii) Income tax relating to items that will not be reclassified to profit 5 1
or loss
Total (A) (6) 80
B i) Items that will be reclassified to profit or loss
(a) The effective portion of gains and loss on hedging 31 (341)
instruments
(b) Changes in Foreign Currency Monetary Item translation (49) (33)
difference account (FCMITDA)
ii) Income tax relating to items that will be reclassified to profit or 6 130
loss
Total (B) (12) (244)
Total Other comprehensive income / (loss) (A+B) (18) (164)
XI Total comprehensive income / (loss) (IX + X) 8,241 4,461
XII Earnings per equity share of Re. 1 each 37
Basic (`) 34.35 19.24
Diluted (`) 34.17 19.14
* Restated (refer note 29( c ))
See accompanying notes to the standalone financial statements
As per our report of even date
For S R B C & CO LLP For and on behalf of Board of Directors
Chartered Accountants
ICAI Firm Reg. No.: 324982E/E300003
242
` in crores
Particulars Amount
As at 01 April 2017 301
Movement during the year @
As at 31 March 2018 302
Movement during the year @@
B. Other equity
` in crores
Reserves and surplus Items of Other Comprehensive Income/ Total
FOR THE YEAR ENDED 31 MARCH 2019
Particulars
(Loss) (OCI)
Capital Securities Capital Debenture Retained Equity General Equity Effective FCMITDA
reserve premium redemption redemption earnings settled reserve instruments portion of
` in crores
For the year ended For the year ended
31 March 2019 31 March 2018
Cash flow from operating activities
Profit before tax 11,817 7,075
Adjustments for :
Depreciation and amortisation expenses 3,397 3,054
Loss on sale of property, plant & equipment (net) 6 124
Gain on sale of financial investments designated as FVTPL (10) (16)
Interest income (239) (176)
Gain arising of financial instruments designated as FVTPL (8) (9)
Unwinding of interest on financial assets carried at amortised cost (31) -
Loss arising from Financial instruments designated as FVTPL 18 30
Dividend income (224) (5)
Interest expense 3,452 3,442
Share based payment expense 50 28
Export obligation deferred income amortisation (160) (67)
Unrealised exchange gain/(loss) 201 44
Allowance for doubtful debts, loans & advances 132 381
Government grant - GST incentive income - (53)
Non cash expenditure 6 -
6,590 6,777
Operating profit before working capital changes 18,407 13,852
Adjustments for :
(Increase) in inventories (517) (812)
(Increase) in trade receivables (2,056) (661)
(Increase) in other assets (924) (1,339)
Increase in trade payable and other liabilities 3,609 2,325
Increase in provisions 38 16
150 (471)
Cash flow from operations 18,557 13,381
Income taxes paid (net of refund received) (2,453) (1,207)
Net cash generated from operating activities (A) 16,104 12,174
Cash flow from investing activities
Purchase of property, plant & equipment, intangible assets including (7,902) (3,776)
under development
Proceeds from sale of property, plant & equipment 31 7
Investment in subsidiaries and joint ventures including advances and (1,237) (175)
preference shares
Sale of other non-current investments in equity instruments through 50 -
FVTOCI
Purchase of current investments (8,340) (7,804)
Sale of current investments 8,350 8,120
Bank deposits not considered as cash and cash equivalents (net) (268) 169
Loans given to related parties (3,317) (2,858)
Loans repaid by related parties 877 -
Interest received 202 178
Dividend received 224 5
Net cash used in investing activities (B) (11,330) (6,134)
` in crores
For the year ended For the year ended
31 March 2019 31 March 2018
Cash flow from financing activities
Proceeds from sale of treasury shares - 49
Payment for purchase of treasury shares (153) (76)
Proceeds from non-current borrowings 6,017 5,571
Repayment of non-current borrowings (4,244) (4,774)
Proceeds from/Repayment of current borrowings (net) 3,196 (2,703)
Repayment of finance lease obligation (365) (296)
Interest paid (3,532) (3,417)
Dividend paid (including corporate dividend tax) (886) (655)
Net cash used in financing activities (C) 33 (6,301)
Net increase/(decrease) in cash and cash equivalents(A+B+C) 4,807 (261)
Cash and cash equivalents - opening balances 451 712
Cash and cash equivalents - closing balances (note 14) 5,258 451
` in crores
Particulars 1 April 17 Cash Foreign Changes in New leases Other 31 March 18
flows(net) exchange fair values
(Gain)/Loss
Borrowings other than finance lease obligation 28,541 797 89 (52) - 52 29,427
(including Current maturities of long term
borrowing included in other financial liabilities
note 27)
Finance Lease Obligations (including Current 4,857 (296) - - 22 (1) 4,582
maturities)
Borrowings (Current) 4,875 (2,703) - - - - 2,172
Other comprises of Upfront Fees Amortization and Interest Cost accrual on preference shares.
Notes:
1. The cash flow statement is prepared using the “indirect method” set out in IND AS 7 – Statement of Cash Flows.
2. The Company has acquired property, plant and equipment of ` 411 crores (previous year ` 22 crores) on finance lease.
See accompanying notes to the standalone financial statements
As per our report of even date
For S R B C & CO LLP For and on behalf of Board of Directors
Chartered Accountants
ICAI Firm Reg. No.: 324982E/E300003
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
These financial statements are approved for issue by the • it is expected to be realized in, or is intended for sale or
Board of Directors on 24 May, 2019. consumption in, the Company’s normal operating cycle.
it is held primarily for the purpose of being traded;
II. Basis of preparation and presentation
The Standalone Financial Statements have been prepared • it is expected to be realized within 12 months after the
on the historical cost basis except for certain financial reporting date; or
instruments measured at fair values at the end of each
reporting year, as explained in the accounting policies • it is cash or cash equivalent unless it is restricted from
below. being exchanged or used to settle a liability for at least
12 months after the reporting date.
Fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction All other assets are classified as non-current.
between market participants at the measurement date,
regardless of whether that price is directly observable or A liability is classified as current when it satisfies any of the
estimated using another valuation technique. In estimating following criteria:
the fair value of an asset or a liability, the Company takes in to
account the characteristics of the asset or liability if market • it is expected to be settled in the Company’s normal
participants would take those characteristics into account operating cycle;
when pricing the asset or liability at the measurement date.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
• it is held primarily for the purpose of being traded; goods or services to a customer before the customer
pays consideration or before payment is due, a contract
• it is due to be settled within 12 months after the reporting asset is recognised for the earned consideration
date; or the Company does not have an unconditional including Trade receivables
right to defer settlement of the liability for at least 12
months after the reporting date. Terms of a liability that ii) Contract liabilities
could, at the option of the counterparty, result in its A contract liability is the obligation to transfer goods
settlement by the issue of equity instruments do not or services to a customer for which the Company has
affect its classification. received consideration (or an amount of consideration
is due) from the customer. If a customer pays
All other liabilities are classified as non-current. consideration before the Company transfers goods
or services to the customer, a contract liability is
Deferred tax assets and liabilities are classified as non- recognised when the payment is made or the payment
current only. is due (whichever is earlier). Contract liabilities are
recognised as revenue when the Company performs
III. Revenue recognition under the contract including Advance received from
A. Sale of Goods Customer
The Company recognizes revenue when control over the
promised goods or services is transferred to the customer iii) Refund liabilities
at an amount that reflects the consideration to which the A refund liability is the obligation to refund some or all
Company expects to be entitled in exchange for those of the consideration received (or receivable) from the
goods or services. customer and is measured at the amount the Company
ultimately expects it will have to return to the customer
Revenue is adjusted for variable consideration such as including volume rebates and discounts. The Company
discounts, rebates, refunds, credits, price concessions, updates its estimates of refund liabilities at the end of
incentives, or other similar items in a contract when they each reporting period.
are highly probable to be provided. The amount of revenue
excludes any amount collected on behalf of third parties. B. Dividend and interest income
Dividend income from investments is recognised when
The Company recognises revenue generally at the point in the shareholder’s right to receive payment has been
time when the products are delivered to customer or when established (provided that it is probable that the economic
it is delivered to a carrier for export sale, which is when benefits will flow to the Company and the amount of income
the control over product is transferred to the customer. In can be measured reliably).
contracts where freight is arranged by the Company and
recovered from the customers, the same is treated as a Interest income from a financial asset is recognised when
separate performance obligation and revenue is recognized it is probable that the economic benefits will flow to the
when such freight services are rendered. Company and the amount of income can be measured
reliably. Interest income is accrued on a time basis, by
In revenue arrangements with multiple performance reference to the principal outstanding and at the effective
obligations, the Company accounts for individual products interest rate applicable, which is the rate that exactly
and services separately if they are distinct – i.e. if a product discounts estimated future cash receipts through the
or service is separately identifiable from other items in the expected life of the financial asset to that asset’s net
arrangement and if a customer can benefit from it. The carrying amount on initial recognition.
consideration is allocated between separate products
and services in the arrangement based on their stand- IV. Leases
alone selling prices. Revenue from sale of by products are Leases are classified as finance leases whenever the terms
included in revenue. of the lease transfer substantially all the risks and rewards
of ownership to the lessee. All other leases are classified as
Revenue from sale of power is recognised when delivered operating leases.
and measured based on the bilateral contractual
arrangements. The Company as a lessor
Leases are classified as finance leases when substantially
Contract balances all of the risks and rewards of ownership transfer from
i) Contract assets the Company to the lessee. Amounts due from lessees
A contract asset is the right to consideration in under finance leases are recorded as receivables at the
exchange for goods or services transferred to the Company’s net investment in the leases. Finance lease
customer. If the Company performs by transferring income is allocated to accounting periods so as to reflect
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
a constant periodic rate of return on the net investment The transactions in currencies other than the entity's
outstanding in respect of the lease. functional currency (foreign currencies) are recognised
at the rates of exchange prevailing at the dates of the
Rental income from operating leases is recognised on transactions. At the end of each reporting year, monetary
straight-line basis over the term of the relevant lease. items denominated in foreign currencies are retranslated at
Initial direct cost incurred in negotiating and arranging an the rates prevailing at that date. Non-monetary items carried
operating lease are added to the carrying amount of the at fair value that are denominated in foreign currencies are
leased asset and recognised on straight-line basis over the retranslated at the rates prevailing at the date when the
lease term. fair value was determined. Non-monetary items that are
measured in terms of historical cost in a foreign currency
The Company as a lessee are not retranslated.
Assets held under finance leases are initially recognised as
assets of the Company at their fair value at the inception of Exchange differences on monetary items are recognised in
the lease or, if lower, at the present value of the minimum Statement of Profit and Loss in the year in which they arise
lease payments. The corresponding liability to the lessor except for:
is included in the Standalone balance sheet as a finance
lease obligation. • exchange differences on foreign currency borrowings
relating to assets under construction for future
Lease payments are apportioned between finance productive use, which are included in the cost of those
expenses and reduction of the lease obligation so as assets when they are regarded as an adjustment to
to achieve a constant rate of interest on the remaining interest costs on those foreign currency borrowings;
balance of the liability. Finance expenses are recognised
immediately in Statement of Profit and Loss, unless they •
exchange differences on transactions entered into
are directly attributable to qualifying assets, in which case in order to hedge certain foreign currency risks (see
they are capitalised in accordance with the Company's below the policy on hedge accounting in 2 (XVIII) (B)
general policy on borrowing costs. Contingent rentals are (g));
recognised as expenses in the years in which they are
incurred. •
exchange difference arising on settlement /
restatement of long-term foreign currency monetary
Lease payments under an operating lease shall be items recognized in the financial statements for the
recognised as an expense on a straight-line basis over the year ended 31 March, 2016 prepared under previous
term of the relevant lease. Where the rentals are structured GAAP, are capitalized as a part of the depreciable
solely to increase in line with expected general inflation fixed assets to which the monetary item relates
to compensate for the lessor’s expected inflationary cost and depreciated over the remaining useful life of
increases, such increases are recognised in the year in such assets. If such monetary items do not relate to
which such benefits accrue. Contingent rentals arising acquisition of depreciable fixed assets, the exchange
under operating leases are recognised as an expense in the difference is amortised over the maturity year / upto the
year in which they are incurred. date of settlement of such monetary item, whichever
is earlier and charged to the Statement of Profit and
Arrangements in the nature of lease Loss. The un-amortised exchange difference is carried
The Company enters into agreements, comprising a under other equity as “Foreign currency monetary
transaction or series of related transactions that does not item translation difference account” net of tax effect
take the legal form of a lease but conveys the right to use thereon, where applicable.
the asset in return for a payment or series of payments.
In case of such arrangements, the Company applies the VI. Borrowing costs
requirements of Ind AS 17 – Leases to the lease element Borrowing costs directly attributable to the acquisition,
of the arrangement. For the purpose of applying the construction or production of qualifying assets, which are
requirements under Ind AS 17 – Leases, payments and other assets that necessarily take a substantial period of time
consideration required by the arrangement are separated to get ready for their intended use or sale, are added to
at the inception of the arrangement into those for lease and the cost of those assets, until such time as the assets are
those for other elements. substantially ready for their intended use or sale.
V. Foreign currencies All other borrowing costs are recognised in the Statement
The functional currency of the Company is determined on of Profit and Loss in the year in which they are incurred.
the basis of the primary economic environment in which it
operates. The functional currency of the Company is Indian The Company determines the amount of borrowing costs
National Rupee (INR). eligible for capitalisation as the actual borrowing costs
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
incurred on that borrowing during the year less any interest corresponding restructuring cost whichever is earlier. Net
income earned on temporary investment of specific interest is calculated by applying the discount rate to the
borrowings pending their expenditure on qualifying assets, net defined benefit liability or asset. Defined benefit costs
to the extent that an entity borrows funds specifically are categorised as follows:
for the purpose of obtaining a qualifying asset. In case if
the Company borrows generally and uses the funds for •
service cost (including current service cost,
obtaining a qualifying asset, borrowing costs eligible for past service cost, as well as gains and losses on
capitalisation are determined by applying a capitalisation curtailments and settlements);
rate to the expenditures on that asset.
• net interest expense or income; and
Borrowing Cost includes exchange differences arising from
foreign currency borrowings to the extent they are regarded • re-measurement
as an adjustment to the finance cost.
The Company presents the first two components of defined
VII. Government grants benefit costs in profit or loss in the line item ‘Employee
Government grants are not recognised until there is benefits expenses’. Curtailment gains and losses are
reasonable assurance that the Company will comply with accounted for as past service costs.
the conditions attached to them and that the grants will be
received.
The retirement benefit obligation recognised in the
statement of financial position represents the actual
Government grants are recognised in the Statement of deficit or surplus in the Company’s defined benefit plans.
Profit and Loss on a systematic basis over the years in Any surplus resulting from this calculation is limited to
which the Company recognises as expenses the related the present value of any economic benefits available in
costs for which the grants are intended to compensate or the form of refunds from the plans or reductions in future
when performance obligations are met. contributions to the plans.
The benefit of a government loan at a below-market rate A liability for a termination benefit is recognised at the
of interest and effect of this favorable interest is treated earlier of when the entity can no longer withdraw the offer
as a government grant. The Loan or assistance is initially of the termination benefit and when the entity recognises
recognized at fair value and the government grant is any related restructuring costs.
measured as the difference between proceeds received
and the fair value of the loan based on prevailing market Short-term and other long-term employee benefits
interest rates and recognised to the income statement A liability is recognised for benefits accruing to employees
immediately on fulfillment of the performance obligations. in respect of wages and salaries, annual leave and sick
The loan is subsequently measured as per the accounting leave in the year the related service is rendered at the
policy applicable to financial liabilities. undiscounted amount of the benefits expected to be paid
in exchange for that service.
VIII. Employee benefits
Retirement benefit costs and termination benefits
Liabilities recognised in respect of short-term employee
Payments to defined contribution retirement benefit plans benefits are measured at the undiscounted amount of the
are recognised as an expense when employees have benefits expected to be paid in exchange for the related
rendered service entitling them to the contributions. service.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
settled share-based payments is expensed on a straight- The carrying amount of deferred tax assets is reviewed at
line basis over the vesting period, based on the Company’s the end of each reporting year and reduced to the extent
estimate of equity instruments that will eventually vest, that it is no longer probable that sufficient taxable profits
with a corresponding increase in equity. At the end of each will be available to allow all or part of the asset to be
reporting year, the Company revises its estimate of the recovered.
number of equity instruments expected to vest. The impact
of the revision of the original estimates, if any, is recognised Minimum Alternate Tax (MAT) paid in accordance with the
in profit or loss such that the cumulative expense reflects tax laws, which gives future economic benefits in the form
the revised estimate, with a corresponding adjustment to of adjustment to future income tax liability, is considered
the equity-settled employee benefits reserve. as an deferred tax asset if there is convincing evidence
that the Company will pay normal income tax. Accordingly,
The Company has created an Employee Benefit Trust for MAT is recognised as an asset in the Balance Sheet when it
providing share-based payment to its employees. The is probable that future economic benefit associated with it
Company uses the Trust as a vehicle for distributing shares will flow to the Company.
to employees under the employee remuneration schemes.
The Trust buys shares of the Company from the market, for Deferred tax assets and liabilities are measured at the tax
giving shares to employees. The Company treats Trust as rates that are expected to apply in the year in which the
its extension and shared held by the Trust are treated as liability is settled or the asset realised, based on tax rates
treasury shares. (and tax laws) that have been enacted or substantively
enacted by the end of the reporting year.
Own equity instruments that are reacquired (treasury
shares) are recognized at cost and deducted from Equity. No Deferred tax assets and deferred tax liabilities are offset
gain or loss is recognized in profit or loss on the purchase, if a legally enforceable right exists to set off current tax
sale, issue or cancellation of the Company’s own equity assets against current tax liabilities and the deferred taxes
instruments. Any difference between the carrying amount relate to the same taxable entity and the same taxation
and the consideration, if reissued, is recognized in capital authority.
reserve. Share options exercised during the reporting year
are satisfied with treasury shares. Current and deferred tax for the year
Current and deferred tax are recognised in profit or loss,
X. Taxes except when they are relating to items that are recognised
Income tax expense represents the sum of the tax currently in other comprehensive income or directly in equity, in which
payable and deferred tax. case, the current and deferred tax are also recognized in
other comprehensive income or directly in equity respectively.
Current tax Where current tax or deferred tax arises from the initial
Current tax is the amount of expected tax payable based on accounting for a business combination, the tax effect is
the taxable profit for the year as determined in accordance included in the accounting for the business combination.
with the applicable tax rates and the provisions of the
Income Tax Act, 1961 Deferred tax assets and liabilities are offset when they
relate to income taxes levied by the same taxation authority
Deferred tax and the relevant entity intends to settle its current tax
Deferred tax is recognised on temporary differences assets and liabilities on a net basis.
between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax XI. Property, plant and equipment
bases used in the computation of taxable profit. Deferred The cost of property, plant and equipment comprises its
tax liabilities are recognised for all taxable temporary purchase price net of any trade discounts and rebates,
differences. Deferred tax assets are recognised for all any import duties and other taxes (other than those
deductible temporary differences to the extent that it is subsequently recoverable from the tax authorities), any
probable that taxable profits will be available against which directly attributable expenditure on making the asset
those deductible temporary differences can be utilised. ready for its intended use, including relevant borrowing
Such deferred tax assets and liabilities are not recognised if costs for qualifying assets and any expected costs of
the temporary difference arises from the initial recognition decommissioning. Expenditure incurred after the property,
(other than in a business combination) of assets and plant and equipment have been put into operation, such as
liabilities in a transaction that affects neither the taxable repairs and maintenance, are charged to the Statement of
profit nor the accounting profit. In addition, deferred tax Profit and Loss in the year in which the costs are incurred.
liabilities are not recognised if the temporary difference Major shut-down and overhaul expenditure is capitalised as
arises from the initial recognition of goodwill. the activities undertaken improves the economic benefits
expected to arise from the asset.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
An item of property, plant and equipment is derecognised convertible to freehold land under lease agreements at
upon disposal or when no future economic benefits are future dates at no additional cost, are not depreciated.
expected to arise from the continued use of the asset.
Any gain or loss arising on the disposal or retirement of an Assets held under finance leases are depreciated over their
item of property, plant and equipment is determined as the expected useful lives on the same basis as owned assets.
difference between the sales proceeds and the carrying However, when there is no reasonable certainty that
amount of the asset and is recognized in Statement of ownership will be obtained by the end of the lease term,
Profit and Loss. assets are depreciated over the shorter of the lease term
and their useful lives.
Assets in the course of construction are capitalised in
the assets under construction account. At the point when Major overhaul costs are depreciated over the estimated
an asset is operating at management’s intended use, life of the economic benefit derived from the overhaul.
the cost of construction is transferred to the appropriate The carrying amount of the remaining previous overhaul
category of property, plant and equipment and depreciation cost is charged to the Statement of Profit and Loss if the
commences. Costs associated with the commissioning of next overhaul is undertaken earlier than the previously
an asset and any obligatory decommissioning costs are estimated life of the economic benefit.
capitalised where the asset is available for use but incapable
of operating at normal levels until a year of commissioning The Company reviews the residual value, useful lives and
has been completed. Revenue (net of cost) generated from depreciation method annually and, if expectations differ
production during the trial period is capitalised. from previous estimates, the change is accounted for as a
change in accounting estimate on a prospective basis.
Property, plant and equipment except freehold land held for
use in the production, supply or administrative purposes, XII. Intangible assets
are stated in the balance sheet at cost less accumulated Intangible assets with finite useful lives that are acquired
depreciation and accumulated impairment losses, if any. separately are carried at cost less accumulated amortisation
and accumulated impairment losses. Amortisation is
The Company has elected to continue with the carrying recognised on a straight-line basis over their estimated
value for all of its property, plant and equipment as useful lives. The estimated useful life and amortisation
recognised in the financial statements on transition to Ind method are reviewed at the end of each reporting year,
AS, measured as per the previous GAAP and use that as its with the effect of any changes in estimate being accounted
deemed cost as at the date of transition. for on a prospective basis. Intangible assets with indefinite
useful lives that are acquired separately are carried at cost
Depreciable amount for assets is the cost of an asset, less accumulated impairment losses.
or other amount substituted for cost, less its estimated
residual value. Depreciation is recognized so as to write off Useful lives of intangible assets
the cost of assets (other than freehold land and properties Estimated useful lives of the intangible assets are as
under construction) less their residual values over their follows:
useful lives, using straight-line method as per the useful life
prescribed in Schedule II to the Companies Act, 2013 except Class of assets Years
in respect of following categories of assets, in whose case Computer Software & Licenses 3-5 years
the life of the assets has been assessed as under based
Mining assets are amortised over the useful life of the mine
on technical advice, taking into account the nature of the
or lease period whichever is lower.
asset, the estimated usage of the asset, the operating
conditions of the asset, past history of replacement,
The Company has elected to continue with carrying value
anticipated technological changes, manufacturers
of all its intangible assets recognised ason transition date,
warranties and maintenance support, etc.
measured as per the previous GAAP and use that carrying
value as its deemed cost as of transition date.
Class of assets Years
Plant and equipment 8 to 40 years
XIII. Mining Assets
Work-rolls (shown under Plant and 1 - 5 years
Exploration and evaluation
equipment)
Exploration and evaluation expenditure incurred after
When significant parts of plant and equipment are required obtaining the mining right or the legal right to explore are
to be replaced at intervals, the Company depreciates them capitalised as exploration and evaluation assets (intangible
separately based on their specific useful lives. assets) and stated at cost less impairment. Exploration and
evaluation assets are assessed for impairment indicators
Freehold land and leasehold land where the lease is at least annually.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The Company measures its exploration and evaluation and rehabilitation of mining sites as soon as the obligation
assets at cost and classifies as Property, plant and to incur such costs arises. Such restoration and closure
equipment or intangible assets according to the nature costs are typical of extractive industries and they are
of the assets acquired and applies the classification normally incurred at the end of the life of the mine. The
consistently. To the extent that tangible asset is consumed costs are estimated on the basis of mine closure plans
in developing an intangible asset, the amount reflecting and the estimated discounted costs of dismantling and
that consumption is capitalised as a part of the cost of the removing these facilities and the costs of restoration are
intangible asset. capitalised. The provision for decommissioning assets is
based on the current estimates of the costs for removing
Exploration expenditure includes all direct and allocated and decommissioning production facilities, the forecast
indirect expenditure associated with finding specific timing of settlement of decommissioning liabilities and
mineral resources which includes depreciation and the appropriate discount rate. A corresponding provision
applicable operating costs of related support equipment is created on the liability side. The capitalised asset is
and facilities and other costs of exploration activities: charged to profit or loss over the life of the asset through
depreciation over the life of the operation and the provision
Acquisition costs - costs associated with acquisition of is increased each period via unwinding the discount on
licenses and rights to explore, including related professional the provision. Management estimates are based on local
fees. legislation and/or other agreements. The actual costs
and cash outflows may differ from estimates because
General exploration costs - costs of surveys and studies, of changes in laws and regulations, changes in prices,
rights of access to properties to conduct those studies analysis of site conditions and changes in restoration
(e.g., costs incurred for environment clearance, defense technology. Details of such provisions are set out in note 21.
clearance, etc.), and salaries and other expenses of
geologists, geophysical crews and other personnel XIV. Impairment of Property, plant and equipment and
conducting those studies. intangible assets
At the end of each reporting year, the Company reviews the
Costs of exploration drilling and equipping exploration - carrying amounts of its tangible and intangible assets to
Expenditure incurred on the acquisition of a license interest determine whether there is any indication that those assets
is initially capitalised on a license-by-license basis. Costs have suffered an impairment loss. If any such indication
are held, undepleted, within exploration and evaluation exists, the recoverable amount of the asset is estimated
assets until such time as the exploration phase on the in order to determine the extent of the impairment loss (if
license area is complete or commercial reserves have been any). Where it is not possible to estimate the recoverable
discovered. amount of an individual asset, the Company estimates the
recoverable amount of the cash-generating unit to which
Stripping cost the asset belongs. Where a reasonable and consistent
Developmental stripping costs in order to obtain access basis of allocation can be identified, corporate assets
to quantities of mineral reserves that will be mined in are also allocated to individual cash-generating units, or
future periods are capitalised as part of mining assets. otherwise they are allocated to the smallest group of cash-
Capitalisation of developmental stripping costs ends when generating units for which a reasonable and consistent
the commercial production of the mineral reserves begins. allocation basis can be identified.
Production stripping costs are incurred to extract the ore Intangible assets with indefinite useful lives and intangible
in the form of inventories and/or to improve access to assets not yet available for use are tested for impairment at
an additional component of an ore body or deeper levels least annually, and whenever there is an indication that the
of material. Production stripping costs are accounted for asset may be impaired.
as inventories to the extent the benefit from production
stripping activity is realized in the form of inventories. Recoverable amount is the higher of fair value less costs
to sell and value in use. In assessing value in use, the
Such costs are presented within mining assets. After estimated future cash flows are discounted to their present
initial recognition, stripping activity assets are carried at value using a pre-tax discount rate that reflects current
cost less accumulated amortisation and impairment. The market assessments of the time value of money and the
expected useful life of the identified component of the ore risks specific to the asset for which the estimates of future
body is used to depreciate or amortise the stripping asset. cash flows have not been adjusted.
Site restoration, rehabilitation and environmental If the recoverable amount of an asset (or cash-generating
costs: unit) is estimated to be less than its carrying amount, the
Provision is made for costs associated with restoration carrying amount of the asset (or cash-generating unit) is
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
reduced to its recoverable amount. An impairment loss is amount is charged or credited to the Statement of Profit
recognised immediately in the Statement of Profit and Loss. and Loss.
When some or all of the economic benefits required to A financial asset is measured at amortised cost if it
settle a provision are expected to be recovered from a meets both of the following conditions and is not
third party, a receivable is recognized as an asset if it is designated at FVTPL:
virtually certain that reimbursement will be received and
the amount of the receivable can be measured reliably. • The asset is held within a business model whose
objective is to hold assets to collect contractual
Onerous contracts cash flows; and
Present obligations arising under onerous contracts are
recognised and measured as provisions. An onerous • The contractual terms of the financial asset give
contract is considered to exist where the Company has a rise on specified dates to cash flows that are
contract under which the unavoidable costs of meeting solely payments of principal and interest on the
the obligations under the contract exceed the economic principal amount outstanding.
benefits expected to be received from the contract.
A debt instrument is classified as FVTOCI only if it meets
XVII. Investment in subsidiaries, associates and joint ventures both of the following conditions and is not recognised
Investment in subsidiaries, associates and joint ventures at FVTPL;
are shown at cost. Where the carrying amount of an
investment in greater than its estimated recoverable •
The asset is held within a business model
amount, it is written down immediately to its recoverable whose objective is achieved by both collecting
amount and the difference is transferred to the Statement contractual cash flows and selling financial
of Profit and Loss. On disposal of investment, the difference assets; and
between the net disposal proceeds and the carrying
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
• The contractual terms of the financial asset give any dividend or interest earned on the financial asset
rise on specified dates to cash flows that are and is included in the ‘other income’ line item. Dividend
solely payments of principal and interest on the on financial assets at FVTPL is recognized when:
principal amount outstanding.
• The Company’s right to receive the dividends is
Debt instruments included within the FVTOCI category established,
are measured initially as well as at each reporting date
at fair value. Fair value movements are recognized in •
It is probable that the economic benefits
the Other Comprehensive Income (OCI). However, the associated with the dividends will flow to the
Company recognizes interest income, impairment entity,
losses & reversals and foreign exchange gain or loss
in the Statement of Profit and Loss. On derecognition • The dividend does not represent a recovery of
of the asset, cumulative gain or loss previously part of cost of the investment and the amount of
recognised in OCI is reclassified from the equity to dividend can be measured reliably.
Statement of Profit and Loss. Interest earned whilst
holding FVTOCI debt instrument is reported as interest c) Derecognition of financial assets
income using the EIR method. The Company derecognises a financial asset when the
contractual rights to the cash flows from the asset
All equity investments in scope of Ind AS 109 are expire, or when it transfers the financial asset and
measured at fair value. Equity instruments which substantially all the risks and rewards of ownership of
are held for trading and contingent consideration the asset to another party.
recognised by an acquirer in a business combination to
which Ind AS 103 applies are classified as at FVTPL. For d) Impairment
all other equity instruments, the Company may make an The Company applies the expected credit loss model
irrevocable election to present in other comprehensive for recognising impairment loss on financial assets
income subsequent changes in the fair value. The measured at amortised cost, debt instruments at
Company makes such election on an instrument-by- FVTOCI, lease receivables, trade receivables, other
instrument basis. The classification is made on initial contractual rights to receive cash or other financial
recognition and is irrevocable. asset, and financial guarantees not designated as at
FVTPL.
If the Company decides to classify an equity
instrument as at FVTOCI, then all fair value changes on Expected credit losses are the weighted average
the instrument, excluding dividends, are recognized of credit losses with the respective risks of default
in the OCI. There is no recycling of the amounts from occurring as the weights. Credit loss is the difference
OCI to Statement of Profit and Loss, even on sale of between all contractual cash flows that are due to the
investment. However, the Company may transfer the Company in accordance with the contract and all the
cumulative gain or loss within equity. cash flows that the Company expects to receive (i.e.
all cash shortfalls), discounted at the original effective
Equity instruments included within the FVTPL category interest rate (or credit-adjusted effective interest
are measured at fair value with all changes recognized rate for purchased or originated credit-impaired
in the Statement of Profit and Loss. financial assets). The Company estimates cash flows
by considering all contractual terms of the financial
All other financial assets are classified as measured at instrument (for example, prepayment, extension, call
FVTPL. and similar options) through the expected life of that
financial instrument.
In addition, on initial recognition, the Company may
irrevocably designate a financial asset that otherwise The Company measures the loss allowance for a
meets the requirements to be measured at amortised financial instrument at an amount equal to the
cost or at FVTOCI as at FVTPL if doing so eliminates or lifetime expected credit losses if the credit risk on
significantly reduces and accounting mismatch that that financial instrument has increased significantly
would otherwise arise. since initial recognition. If the credit risk on a financial
instrument has not increased significantly since
Financial assets at FVTPL are measured at fair value initial recognition, the Company measures the loss
at the end of each reporting year, with any gains allowance for that financial instrument at an amount
and losses arising on remeasurement recognized equal to 12-month expected credit losses. 12-month
in statement of profit or loss. The net gain or loss expected credit losses are portion of the life-time
recognized in statement of profit or loss incorporates expected credit losses and represent the lifetime cash
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
shortfalls that will result if default occurs within the 12 premiums or discounts) through the expected life of
months after the reporting date and thus, are not cash the debt instrument, or, where appropriate, a shorter
shortfalls that are predicted over the next 12 months. year, to the net carrying amount on initial recognition.
If the Company measured loss allowance for a financial Income is recognised on an effective interest basis
instrument at lifetime expected credit loss model in the for debt instruments other than those financial assets
previous year, but determines at the end of a reporting classified as at FVTPL. Interest income is recognized in
year that the credit risk has not increased significantly statement of profit or loss and is included in the ‘Other
since initial recognition due to improvement in credit income’ line item.
quality as compared to the previous year, the Company
again measures the loss allowance based on 12-month B. Financial liabilities and equity instruments
expected credit losses. a) Classification as debt or equity
Debt and equity instruments issued by a company are
When making the assessment of whether there has classified as either financial liabilities or as equity in
been a significant increase in credit risk since initial accordance with the substance of the contractual
recognition, the Company uses the change in the arrangements and the definitions of a financial liability
risk of a default occurring over the expected life of and an equity instrument.
the financial instrument instead of the change in
the amount of expected credit losses. To make that b) Equity instruments
assessment, the Company compares the risk of a An equity instrument is any contract that evidences
default occurring on the financial instrument as at a residual interest in the assets of an entity after
the reporting date with the risk of a default occurring deducting all of its liabilities. Equity instruments
on the financial instrument as at the date of initial issued by the Company are recognised at the proceeds
recognition and considers reasonable and supportable received, net of direct issue costs.
information, that is available without undue cost or
effort, that is indicative of significant increases in Repurchase of the Company’s own equity instruments
credit risk since initial recognition. is recognised and deducted directly in equity. No gain
or loss is recognised in Statement of Profit and Loss
For trade receivables or any contractual right to on the purchase, sale, issue or cancellation of the
receive cash or another financial asset that result from Company’s own equity instruments.
transactions that are within the scope of Ind AS 115,
the Company always measures the loss allowance at c) Financial liabilities
an amount equal to lifetime expected credit losses. Financial liabilities are classified as either financial
liabilities ‘at FVTPL’ or ‘other financial liabilities’.
Further, for the purpose of measuring lifetime expected
credit loss allowance for trade receivables, the Financial liabilities at FVTPL:
Company has used a practical expedient as permitted Financial liabilities are classified as at FVTPL when
under Ind AS 109. This expected credit loss allowance is the financial liability is either held for trading or it is
computed based on a provision matrix which takes into designated as at FVTPL.
account historical credit loss experience and adjusted
for forward-looking information. A financial liability is classified as held for trading if:
The impairment requirements for the recognition and • It has been incurred principally for the purpose of
measurement of a loss allowance are equally applied repurchasing it in the near term; or
to debt instruments at FVTOCI except that the loss
allowance is recognised in other comprehensive • on initial recognition it is part of a portfolio of
income and is not reduced from the carrying amount in identified financial instruments that the Company
the balance sheet manages together and has a recent actual pattern
of short-term profit-taking; or
e) Effective interest method
The effective interest method is a method of calculating •
it is a derivative that is not designated and
the amortised cost of a debt instrument and of effective as a hedging instrument.
allocating interest income over the relevant year. The
effective interest rate is the rate that exactly discounts A financial liability other than a financial liability held
estimated future cash receipts (including all fees and for trading may be designated as at FVTPL upon initial
points paid or received that form an integral part of recognition if:
the effective interest rate, transaction costs and other
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
•
such designation eliminates or significantly discharged, cancelled or have expired. An exchange
reduces a measurement or recognition between with a lender of debt instruments with
inconsistency that would otherwise arise; substantially different terms is accounted for as an
extinguishment of the original financial liability and
•
the financial liability forms part of a group of the recognition of a new financial liability. Similarly, a
financial assets or financial liabilities or both, substantial modification of the terms of an existing
which is managed and its performance is financial liability (whether or not attributable to the
evaluated on a fair value basis, in accordance with financial difficulty of the debtor) is accounted for as an
the Company’s documented risk management or extinguishment of the original financial liability and the
investment strategy, and information about the recognition of a new financial liability. The difference
grouping is provided internally on that basis; or between the carrying amount of the financial liability
derecognised and the consideration paid and payable
• it forms part of a contract containing one or more is recognised in the Statement of Profit and Loss .
embedded derivatives, and Ind AS 109 permits the
entire combined contract to be designated as at d) Derivative financial instruments
FVTPL in accordance with Ind AS 109. The Company enters into a variety of derivative financial
instruments to manage its exposure to interest
Financial liabilities at FVTPL are stated at fair value, rate, commodity price and foreign exchange rate
with any gains or losses arising on remeasurement risks, including foreign exchange forward contracts,
recognised in Statement of Profit and Loss. The net commodity forward contracts, interest rate swaps and
gain or loss recognised in Statement of Profit and Loss cross currency swaps.
incorporates any interest paid on the financial liability
and is included in the Statement of Profit and Loss. Derivatives are initially recognised at fair value at the
For Liabilities designated as FVTPL, fair value gains/ date the derivative contracts are entered into and are
losses attributable to changes in own credit risk are subsequently remeasured to their fair value at the end
recognized in OCI. of each reporting year. The resulting gain or loss is
recognised in Statement of Profit and Loss immediately
The Company derecognises financial liabilities unless the derivative is designated and effective as a
when, and only when, the Company’s obligations are hedging instrument, in which event the timing of the
discharged, cancelled or they expire. The difference recognition in Statement of Profit and Loss depends on
between the carrying amount of the financial liability the nature of the hedge item.
derecognised and the consideration paid and payable
is recognised in the Statement of Profit and Loss. e) Embedded derivatives
An embedded derivative is a component of a hybrid
Other financial liabilities: (combined) instrument that also includes a non-
The Company enters into deferred payment derivative host contract – with the effect that some
arrangements (acceptances) whereby overseas of the cash flows of the combined instrument vary in a
lenders such as banks and other financial institutions way similar to a stand-alone derivative. An embedded
make payments to supplier’s banks for import of raw derivative causes some or all of the cash flows that
materials and property, plant and equipment. The otherwise would be required by the contract to
banks and financial institutions are subsequently be modified according to a specified interest rate,
repaid by the Company at a later date providing financial instrument price, commodity price, foreign
working capital benefits. These arrangements are exchange rate, index of prices or rates, credit rating or
in the nature of credit extended in normal operating credit index, or other variable, provided in the case of a
cycle and these arrangements for raw materials are non-financial variable that the variable is not specific
recognized as Acceptances (under trade payables) to a party to the contract. Reassessment only occurs
and arrangements for property, plant and equipment if there is either a change in the terms of the contract
are recognised as other financial liabilities. Interest that significantly modifies the cash flows that would
borne by the company on such arrangements is otherwise be required or a reclassification of a financial
accounted as finance cost. Other financial liabilities asset out of the fair value through profit or loss.
(including borrowings and trade and other payables)
are subsequently measured at amortised cost using If the hybrid contract contains a host that is a financial
the effective interest method. asset within the scope of Ind AS 109, the Company
does not separate embedded derivatives. Rather, it
Derecognition of financial liabilities: applies the classification requirements contained in
The Company derecognises financial liabilities Ind AS 109 to the entire hybrid contract. Derivatives
when, and only when, the Company’s obligations are embedded in all other host contracts are accounted
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
for as separate derivatives and recorded at fair value the heading of cash flow hedging reserve. The
if their economic characteristics and risks are not gain or loss relating to the ineffective portion is
closely related to those of the host contracts and the recognised immediately in profit or loss.
host contracts are not held for trading or designated
at fair value though profit or loss. These embedded
Amounts previously recognised in other
derivatives are measured at fair value with changes in comprehensive income and accumulated in
fair value recognised in profit or loss, unless designated equity relating to effective portion as described
as effective hedging instruments. above are reclassified to profit or loss in the years
when the hedged item affects profit or loss, in
f) Hedge accounting the same line as the recognised hedged item.
The Company designates certain hedging instruments, However, when the hedged forecast transaction
which include derivatives, embedded derivatives and results in the recognition of a non-financial
non-derivatives in respect of foreign currency, interest asset or a non-financial liability, such gains or
rate and commodity risk, as either cash flow hedge, losses are transferred from equity (but not as
fair value hedge. Hedges of foreign currency risk on a reclassification adjustment) and included in
firm commitments are accounted for as cash flow the initial measurement of the cost of the non-
hedges. financial asset or non-financial liability.
At the inception of the hedge relationship, the entity Hedge accounting is discontinued when the
documents the relationship between the hedging hedging instrument expires or is sold, terminated,
instrument and the hedged item, along with its or exercised, or when it no longer qualifies for
risk management objectives and its strategy for hedge accounting. Any gain or loss recognised in
undertaking various hedge transactions. Furthermore, other comprehensive income and accumulated
at the inception of the hedge and on an ongoing in equity at that time remains in equity and is
basis, the Company documents whether the hedging recognised when the forecast transaction is
instrument is highly effective in offsetting changes in ultimately recognised in profit or loss. When a
fair values or cash flows of the hedged item attributable forecast transaction is no longer expected to
to hedged risk. occur, the gain or loss accumulated in equity is
recognised immediately in profit or loss.
(i) Fair value hedges
Changes in fair value of the designated portion of XIX. Cash and cash equivalents:
derivatives that qualify as fair value hedges are Cash and cash equivalent in the Balance Sheet comprise
recognized in the Statement of Profit and Loss cash at banks and on hand and short-term deposits with an
immediately, together with any changes in the original maturity of three months or less, which are subject
fair value of the hedged asset or liability that are to insignificant risk of changes in value.
attributable to the hedged risk. The change in the
fair value of the designated portion of hedging For the purpose of the Statement of cash flows, cash and
instrument and the change in the hedged item cash equivalent consists of cash and short-term deposits,
attributable to hedged risk are recognized in as defined above, net of outstanding bank overdrafts as
the Statement of Profit and Loss in the line item they are considered an integral part of the Company’s cash
relating to the hedged item. management.
(ii) Cash flow hedges Diluted earnings per share is computed by dividing the
The effective portion of changes in fair value profit / (loss) after tax as adjusted for dividend, interest and
of derivatives that are designated and qualify other charges to expense or income (net of any attributable
as cash flow hedges is recognized in other taxes) relating to the dilutive potential equity shares, by the
comprehensive income and accumulated under weighted average number of equity shares considered for
deriving basic earnings per share and the weighted average
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
number of equity shares which could have been issued Contingent assets are neither recognized nor disclosed
on the conversion of all dilutive potential equity shares in the financial statements unless when an inflow of
including the treasury shares held by the Company to economic benefits is probable.
satisfy the exercise of the share options by the employees.
iv) Fair value measurements
3. Key sources of estimation uncertainty and When the fair values of financial assets or financial liabilities
critical accounting judgements recorded or disclosed in the financial statements cannot be
In the course of applying the policies outlined in all notes measured based on quoted prices in active markets, their
under section 2 above, the Company is required to make fair value is measured using valuation techniques including
judgements, estimates and assumptions about the the DCF model. The inputs to these models are taken from
carrying amount of assets and liabilities that are not readily observable markets where possible, but where this is not
apparent from other sources. The estimates and associated feasible, a degree of judgment is required in establishing
assumptions are based on historical experience and other fair values. Judgements include consideration of inputs
factors that are considered to be relevant. Actual results such as liquidity risk, credit risk and volatility.
may differ from these estimates.
v) Taxes
The estimates and underlying assumptions are reviewed Deferred tax assets are recognized for unused tax losses
on an ongoing basis. Revisions to accounting estimates to the extent that it is probable that taxable profit will
are recognized in the year in which the estimate is revised be available against which the losses can be utilized.
if the revision affects only that year, or in the year of the Significant management judgement is required to determine
revision and future year, if the revision affects current and the amount of deferred tax assets that can be recognised,
future year. based upon the likely timing and the level of future taxable
profits together with future tax planning strategies.
A) Key sources of estimation uncertainty
i) Useful lives of property, plant and equipment MAT is assessed on book profits adjusted for certain items
Management reviews the useful lives of property, plant and as compared to the adjustments followed for assessing
equipment at least once a year. Such lives are dependent regular income tax under normal provisions. MAT paid in
upon an assessment of both the technical lives of the excess of regular income tax during a year can be set off
assets and also their likely economic lives based on various against regular income taxes within a specified period in
internal and external factors including relative efficiency which MAT credit arises, subject to the limits prescribed.
and operating costs. This reassessment may result in
change in depreciation and amortisation expected in future B) Critical accounting judgements
periods. i) Control over JSW Realty & Infrastructure Private Limited
(RIPL)
ii) Impairment of investments in subsidiaries, joint- ventures RIPL has developed a residential township in Vijayanagar,
and associates Karnataka on the land taken on lease from the Company
Determining whether the investments in subsidiaries, joint for a period of 30 years and provides individual housing
ventures and associates are impaired requires an estimate units on rent to the employees of the Company or other
in the value in use of investments. In considering the value group companies. RIPL is not allowed to sub-let or assign
in use, the Directors have anticipated the future commodity its rights under the arrangement without prior written
prices, capacity utilization of plants, operating margins, consent of the Company. Though the Company does not
mineable resources and availability of infrastructure of hold any ownership interest in RIPL, the Company has
mines, discount rates and other factors of the underlying concluded that the Company has practical ability to direct
businesses / operations of the investee companies as the relevant activities of RIPL unilaterally, considering
more fully described in note 50. Any subsequent changes RIPL’s dependency on the Company for funding significant
to the cash flows due to changes in the above mentioned portion of its operation through subscription to 74.57% of
factors could impact the carrying value of investments. preference share capital amounting to ` 199 crore issued
by RIPL and significant portion of RIPL’s activities
iii) Contingencies
In the normal course of business, contingent liabilities may ii) Separating payments of lease from the other payments
arise from litigation and other claims against the Company. If an arrangement contains a lease, the parties to the
Potential liabilities that are possible but not probable arrangement shall apply the requirements of Ind AS 17 to
of crystalising or are very difficult to quantify reliably the lease element. Therefore, the Company is required to
are treated as contingent liabilities. Such liabilities are separate payments and other consideration required by the
disclosed in the notes but are not recognized. The cases arrangement into those for the lease and for other elements
which have been determined as remote by the Company on the basis of their relative fair values.
are not disclosed.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
f) Certain property, plant and equipment are pledged against borrowings, the details relating to which have been described in Note
19 and Note 24.
g) The title deeds of immovable properties, included in property, plant and equipment are held in the name of the Company except
for leasehold land aggregating to ` 67 crores wherein the lease deed has expired and the Company has a right to convert the land
into freehold land subject to complying with certain conditions. The Company is in the process of converting the title into freehold
as per the lease cum sale agreement.
h) Property, plant and equipment includes proportionate share (50%) of assets under joint operation as below:
` in crores
Particulars Buildings (Owned) Plant and Equipment (Owned)
Cost/deemed cost
At 1 April 2017 476 7
Additions - -
At 31 March 2018 476 7
Additions - -
At 31 March 2019 476 7
Accumulated depreciation
At 1 April 2017 32 1
Depreciation 16 1
At 31 March 2018 48 2
Depreciation 16 1
At 31 March 2019 64 3
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
5. Capital work in progress includes exchange fluctuation loss (including regarded as an adjustment to borrowing costs) of ` 307
crores (previous year ` 54 crores) and borrowing cost of ` 166 crores (previous year ` 50 crores) capitalised during the year.
6. Intangible assets
` in crores
Particulars Computer software License fees Mining Assets Total
Cost/deemed cost
At 1 April 2017 73 22 - 95
Additions 20 4 18 42
At 31 March 2018 93 26 18 137
Additions 28 - 105 133
At 31 March 2019 121 26 123 270
Accumulated depreciation
At 1 April 2017 36 8 - 44
Depreciation 20 7 1 28
At 31 March 2018 56 15 1 72
Depreciation 15 4 7 26
At 31 March 2019 71 19 7 98
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
^ ` 0.01 crores ^^ ` 0.19 crores && ` 0.19 crores $$ ` 0.01 crores &&& ` 3,990
Note:
(a) 304,373,882 shares (as at 31 March 2018 304,373,882 shares ) are pledged to the subsidiary’s banker.
(b) 400,605,365 shares (as at 31 March 2018 400,605,365 shares ) are pledged to the subsidiary’s banker.
(c) 40,000,000 shares (as at 31 March 2018 40,000,000 shares) are pledged to the subsidiary’s banker.
8. Investments (non-current)
As at 31 March 2019 As at 31 March 2018
Particulars Paid up value No. of shares ` in crores No. of shares ` in crores
A Investment in equity instruments
Quoted-Others (at fair value through OCI)
Fully paid up
JSW Energy Limited (refer Note (a) ) ` 10 each 8,53,63,090 619 9,14,74,090 666
Unquoted
Others (at fair value through OCI)
Toshiba JSW Power Systems Private Limited ` 10 each 1,10,00,000 - 1,10,00,000 -
MJSJ Coal Limited ` 10 each 1,04,61,000 9 1,04,61,000 9
SICOM Limited ` 10 each 6,00,000 5 6,00,000 5
Kalyani Mukand Limited ` 1 each 4,80,000 $ 4,80,000 $
Ispat Profiles India Limited ` 1 each 15,00,000 $ 15,00,000 $
14 14
B Investments in preference shares Terms
Unquoted- (at fair value through profit or loss)
Subsidiaries
JSW Steel(Netherlands) B.V. 5% redeemable, 3,99,00,250 254 3,99,00,250 254
non-cumula-
tive of Euro 1 each
JSW Steel (Salav) Limited 0% redeemable, 2,31,34,494 7 2,31,34,494 6
non-cumula-
tive of ` 10 each
JSW Realty & Infrastructure Private Limited 10% redeemable, 1,99,15,000 89 1,99,15,000 82
non-cumulative of
` 100 each
JSW Realty & Infrastructure Private Limited 10% redeemable, 50,00,000 34 - -
non-cumulative of
` 100 each(Series 1)
JSW Realty & Infrastructure Private Limited 10% redeemable, 53,00,000 27 - -
non-cumulative of
` 100 each(Series 2)
Joint ventures
Rohne Coal Company Private Limited 1% non-cumula- 2,36,42,580 - 2,36,42,580 -
tive of ` 10 each
Rohne Coal Company Private Limited 1% Series-A non-cu- 71,52,530 5 71,52,530 7
mulative of ` 10 each
Rohne Coal Company Private Limited 1% Series-B non-cu- 13,70,786 1 11,43,486 1
mulative of ` 10 each
417 350
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Note:
(a) Sale of shares to Amba River Coke Limited (14,56,000 shares) and JSW Steel Coated Products Limited (46,55,000 shares). Sale of
61,11,000 shares at fair value of ` 82.21 which is the quoted price on date of sale, resulting in cumulative gain recognized ` 36 crores
which is transferred from Equity Instruments through Other Comprehensive Income to Retained Earnings.
9. Loans (Unsecured)
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars Non -current Current Non –current Current
Loans
to related parties* 8,070 47 5,400 4
to other body corporate 9 - 9 -
Security deposits 280 89 288 154
Less : Allowance for doubtful loans (685) - (532) -
Total 7,674 136 5,165 158
Note :
Loans Receivable Considered good - Secured
Loans Receivable Considered good - Unsecured 7,674 136 5,165 158
Loans Receivable which have significant increase in Credit Risk - - - -
Loans Receivable – credit impaired
Loans and advances to other body corporate 9 - 9 -
Loans and advances to related parties 676 - 523 -
*Loans are given for business purpose. refer note 43 for terms of Loan
The Company had recognised financial guarantee obligation in the earlier years towards lenders of a subsidiary, against which
incremental loans have been advanced to the subsidiary during the current year. Consequently, the financial guarantee obligation has
been released and basis of the recoverability of the said loans provision for doubtful allowances has been recognised resulting in net
impact of ` Nil in the statement of profit and loss.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
12. Inventories
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Raw materials (at cost) 4,975 4,774
Work-in-progress (at cost) 476 690
Semi-finished/ finished goods (at cost or net realisable value) 3,229 2,826
Production consumables, fuel stock and stores and spares (at cost) 1,919 1,792
Total 10,599 10,082
Inventories have been pledged as security against certain bank borrowings, details relating to which has been described in
note 19 and note 24
Details of Stock-in-transit
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Raw materials 1,551 1,867
Production consumables and stores and spares 146 189
Total 1,697 2,056
The credit period on sales of goods ranges from 7 to 60 days with or without security.
Before accepting any new customer, the Company uses an external credit scoring system to assess the potential customer’s credit
quality and defines credit limits by customer. Limits and scoring attributed to customers are reviewed once a year.
The Company does not generally hold any collateral or other credit enhancements over these balances nor does it have a legal right of
offset against any amounts owed by the Company to the counterparty.
Trade receivables have been given as collateral towards borrowings details relating to which has been described in note 19 and note 24.
Credit risk management regarding trade receivables has been described in note 41 (8).
Trade receivables from related parties details has been described in note 43.
Trade receivables does not include any receivables from directors and officers of the company.
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Balances with Banks
In current accounts 420 188
In term deposit with maturity less than 3 months at inception 4,737 262
Cheques on hand 100 -
Cash on hand 1 #
Total 5,258 451
# represents amounts below ` 0.5 crores
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
ESOP is the primary arrangement under which shared plan service incentives are provided to certain specified employees
of the Company and it’s subsidiaries in India. For the purpose of the scheme, the Company purchases shares from the open market
under ESOP trust. The Company treats ESOP trust as its extension and shares held by ESOP trust are treated as treasury shares.
For the details of shares reserved for issue under the Employee Stock Ownership Plan (ESOP) of the Company refer note 38.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
c) Shareholders Holding More Than 5% Share in the Company are set out Below
As at 31 March 2019 As at 31 March 2018
Particulars No of shares % of shares No of shares % of shares
Equity shares
JFE Steel International Europe BV 36,25,83,070 15.00% 36,25,83,070 15.00%
JSW Holdings Limited 17,88,37,230 7.40% 17,73,06,230 7.34%
Vividh Finvest Private Limited 14,19,95,690 5.87% 14,07,26,690 5.82%
(Formerly Vividh Consultancy & Advisory Services Private Limited)
JSW Techno Projects Management Ltd 24,73,28,450 10.23% 22,93,26,950 9.49%
d) Shares Alloted as Fully Paid-Up Pursuant to Contracts Without Payment Being Received in Cash During the year
of Five Years Immediately Preceding the Date of the Balance Sheet are as Under:
Nil
Consequent to introduction of Companies Act 2013, the requirement of mandatory transfer of a specified percentage of the net
profit to general reserve has been withdrawn and the Company can optionally transfer any amount from the surplus of profit or loss
to the General reserves. This reserve is utilised in accordance with the specific provisions of the Companies Act 2013.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at 31 March 2019 As at 31 March 2018
Non-Current Current Non-Current Current Terms of Repayments Security
A. Bonds/Debentures
Bonds (Unsecured)
- 3,459 3,252 - 4.75% Repayable on 12 November 2019 -
3,459 - 3,252 - 5.25% Repayable on 13 April 2022 -
3,459 3,459 6,504 -
Debentures(secured)
1,000 - 1,000 - 10.02% secured NCDs of ` 10,00,000 First pari passu charge on 3.8 mtpa
each are redeemable in two tranches property, plant and equipments located at
a. ` 500 crores on 20 May 2023 Vijayanagar Works Karnataka (other than
b. ` 500 crores on 19 July 2023 specifically carved out) and a flat situated
at Vasind, Maharashtra.
1,000 - 1,000 - 10.34% secured NCDs of ` 10,00,000 First pari passu charge on property,
each are redeemable in three tranches plant and equipments related to 2.8
a. ` 330 crores on 18 January 2022 mtpa expansion project located at
b. ` 330 crores on 18 January 2023 Vijayanagar Works, Karnataka and a flat at
c. ` 340 crores on 18 January 2024 Vasind, Maharashtra.
- 400 400 - 9.72% secured NCDs of First pari passu charge on 3.2 mtpa
` 10,00,000 each are redeemable on property, plant and equipments located at
23 December 2019. Vijayanagar Works Karnataka (other than
specifically carved out) and a flat situated
at Vasind, Maharashtra.
- 250 250 - 10.40% secured NCDs of ` 10,00,000 First pari passu charge on 3.2 mtpa
each are redeemable on 19 August 2019 . property, plant and equipments located at
Vijayanagar Works Karnataka (other than
specifically carved out) and a flat situated
at Vasind, Maharashtra.
425 425 - 10.60% secured NCDs of ` 10,00,000 First pari passu charge on 3.2 mtpa
each are redeemable on 19 August 2019. property, plant and equipments located at
Vijayanagar Works Karnataka (other than
specifically carved out) and a flat situated
at Vasind, Maharashtra.
- - - 300 9.665% secured NCDs of First pari passu charge on 3.2 mtpa
` 10,00,000 each are redeemed on property, plant and equipments located at
21 December 2018. Vijayanagar Works Karnataka (other than
specifically carved out) and a flat situated
at Vasind, Maharashtra.
- - - 175 10.50% secured NCDs of ` 10,00,000 First pari passu charge on 3.2 mtpa
each are redeemed on 18 August 2018. property, plant and equipments located at
Vijayanagar Works Karnataka (other than
specifically carved out) and a flat situated
at Vasind, Maharashtra.
- 44 44 44 10.60% secured NCDs of ` 2,50,000 Pari passu first charge by way of legal
each are redeemable as 2 half yearly mortgage on land situated in the State of
instalments of `21.875 crores each from Gujarat. Pari passu first charge by way of
02 August 2019 to 02 February 2020. equitable mortgage on property, plant and
equipments of the new 5 mtpa Hot Strip Mill
at Vijayanagar Works, Karnataka
- 22 22 44 10.60% secured NCDs of ` 1,25,000 Pari passu first charge by
each are redeemable as 1 half yearly way of legal mortgage on land
instalment of `21.875 crores on 02 July situated in the State of Gujarat.
2019. Pari passu first charge by way of
equitable mortgage on property, plant and
equipments of the new 5 mtpa Hot Strip
Mill at Vijayanagar Works, Karnataka
2,000 1,141 3,141 563
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at 31 March 2019 As at 31 March 2018
Non-Current Current Non-Current Current Terms of Repayments Security
B. Term Loans
Rupee Term Loans From Banks (Secured) Weighted average interest rate as on 31 March 2019 is 9.21%
638 75 712 38 06 Quarterly instalments of First charge on property, plant and
` 18.75 crores each from 27 April 2019 equipments upto 5 MTPA capacity
to 27 July 2020 situated at Dolvi works, Maharashtra.
16 Quarterly instalments of ` 37.50
crores each from 27 October 2020
to 27 July 2024
750 125 875 100 03 Quarterly instalment of First charge on 3.2 mtpa expansion
` 25 crores each from 30 June 2019 to property, plant and equipments situated
31 December 2019 at Vijayanagar Works Karnataka
16 Quarterly instalment of ` 50
crores each from 31 March 2020 to
31 December 2023
1,031 63 1,094 62 06 Quarterly instalments of ` 15.625 First charge on property, plant and
crores each from 30 April 2019 to equipments upto 5 MTPA capacity
31 July 2020 situated at Dolvi works, Maharashtra.
04 Quarterly instalments of ` 62.50
crores each from 31 October 2020 to 31
July 2021
08 Quarterly instalments of ` 93.75
crores each from 31 October 2021
to 31 July 2023
812 150 962 75 11 quarterly instalments of ` 37.5 First pari passu charge on 3.8mtpa
crores each from 30 June 2019 to upstream assets (other than assets
31 December 2021 specifically carved out) at Vijayanagar
04 quarterly instalments of ` 43.75 Works, Karnataka.
crores each from 31 March 2022 to
31 December 2022
02 quarterly instalments of ` 187.5
crores each from 31 March 2023
to 30 June 2023
1,400 200 1,600 150 08 Quarterly instalments of First charge on property, plant and
` 50 crores each from 30 June 2019 equipments upto 5 MTPA capacity
to 31 March 2021 situated at Dolvi works, Maharashtra.
04 Quarterly installmets of
` 125 crores each from 30 June 2021
to 31 March 2022
02 Quarterly instalments of ` 350
crores each from 30 June 2022 to 30
September 2022.
500 150 650 150 08 quarterly instalments of First pari passu charge on 3.8mtpa
` 37.5 crores each from 30 June 2019 upstream assets (other than assets
to 31 March 2021 specifically carved out) at Vijayanagar
04 quarterly instalments of ` 43.75 Works, Karnataka.
crores each from 30 June 2021
to 31 March 2022
02 quarterly instalments of ` 87.5
crores each from 30 June 2022 to 30
September 2022.
902 192 1,094 192 10 quarterly instalments of First charge on entire movable and
` 48 crores each from 30 June 2019 to immovable property, plant and
30 September 2021 equipments upto 5 MTPA capacity
09 quarterly instalments of situated at Dolvi works, Maharashtra
` 64 crores each from 31 December (excluding those specifically charged
2021 to 31 December 2023 and equipment/machinery procured
01 quarterly instalment of ` 38.35 crores out of proceeds of ECA/ECB/FCL) both
on 31 March 2024. present and future.
163 50 213 50 17 Quarterly instalments of First charge on property, plant and
` 12.5 crores each from 30 June 2019 equipments upto 5 MTPA capacity
to 30 June 2023. situated at Dolvi works, Maharashtra.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at 31 March 2019 As at 31 March 2018
Non-Current Current Non-Current Current Terms of Repayments Security
215 125 340 75 01 quarterly instalment of ` 20 crores First charge on 3.2 mtpa expansion
on 30 June 2019 property, plant and equipments (other
04 quarterly instalments of ` 35 than assets specifically carved out)
crores each from 30 September 2019 situated at Vijayanagar Works Karnataka
to 30 June 2020
04 quarterly instalments of ` 45
crores each from 30 September 2020
to 30 June 2021
325 100 425 75 17 quarterly instalments of ` 25 crores First charge on 3.2 mtpa expansion
each from 03 June 2019 to 01 June 2023 property, plant and equipments situated
at Vijayanagar Works Karnataka
338 337 675 712 01 quarterly installment of ` 225 crores First charge on 3.2 mtpa expansion
on 30 June 2019 property, plant and equipments (other
04 quarterly instalments of ` 37.50 than assets specifically carved out)
crores each from 30 September 2019 to situated at Vijayanagar Works Karnataka
30 June 2020
02 quarterly instalments of ` 150 crores
each from 30 September 2020 to
31 December 2020
375 75 450 38 08 quarterly instalments of First pari passu charge on 3.8 mtpa
` 18.75 crores each from 30 June 2019 property, plant and equipments located at
to 31 March 2021 Vijayanagar Works Karnataka (other than
12 quarterly instalments of specifically carved out).
` 25 crores each from 30 June 2021
to 31 March 2024
450 37 - - 04 quarterly instalments of ` 9.375 First pari passu charge on 3.8 mtpa
crores each from 30 June 2019 property, plant and equipments located at
to 31 March 2020 Vijayanagar Works Karnataka (other than
08 quarterly instalments of ` 18.75 specifically carved out).
crores each from 30 June 2020 to 31
March 2022 12 quarterly instalments
of ` 25 crores each from 30 June 2022
to 31 March 2025
156 63 219 31 14 quarterly instalments of ` 15.625 First pari passu charge on 3.8 mtpa
crores each from 30 June 2019 to 30 property, plant and equipments located at
September 2022 Vijayanagar Works Karnataka (other than
specifically carved out) .
110 - - - 12 quarterly instalments of First pari passu charge on expansion
` 1.375 crores each from 31 June 2021 project at Dolvi Works, Maharashtra from
to 31 March 2024 5 MTPA to 10 MTPA capacity (other than
04 quarterly instalments of ` 6.875 specifically carved out) .
crores each from 30 June 2024
to 31 March 2025
08 quarterly instalments of
` 8.25 crores each from 30 June 2025
to 31 March 2027
475 25 - - 20 quarterly instalments of ` 25 First pari passu charge on property,
crores each from 15 March 2020 to plant and equipments situated at Salem
15 December 2024 Works, Tamil Nadu.
8,640 1,767 9,309 1,748
Rupee Term Loans From Banks (Unsecured) Weighted average interest rate as on 31 March 2019 is 8.98%
- - - 250 02 quarterly instalments of ` 125 crores
each repaid on 30 June 2018 and
30 September 2018
- - - 400 02 Instalments repaid
` 150 crores on 30 July 2018
` 250 crores on 30 December 2018
- - - 250 02 Instalments repaid
` 50 crores on 15 November 2018
` 200 crores on 15 December 2018
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at 31 March 2019 As at 31 March 2018
Non-Current Current Non-Current Current Terms of Repayments Security
150 120 - - 08 quarterly instalments of
` 30 crores each from 20 June 2019
to 20 March 2021
Final installment of ` 30
crores on 20 May 2021
250 500 03 equal instalments of
` 250 crores each on
i. 20 December 2019,
ii. 20 February 2020 and
iii. 20 May 2020
400 620 - 900
Foreign Currency Term Loans From Banks (Unsecured) Weighted average interest rate as on 31 March 2019 is 4.94%
475 200 634 188 05 half yearly instalments of -
` 57.53 crores each from 31 May 2019
to 31 May 2021.
09 half yearly instalments of
` 36.76 crores each from 30 April 2019
to 30 April 2023
10 half yearly instalments of ` 5.60
crores each from 18 September 2019
to 18 March 2024.
53 13 62 12 10 half yearly instalments of ` 6.585 -
crores each from 28 August 2019 to
28 February 2024
103 20 116 19 10 half yearly instalments of ` 3.12 -
crores each from 31 July 2019 to
31 January 2024.
11 half yearly instalments of ` 1.11 crores
each from 30 April 2019 to 30 April 2024
14 semi annual instalments of `2
crores each from 25 September 2019
to 25 March 2026
14 semi annual instalments of ` 2.08
crores each from 25 September 2019
to 25 March 2026.
15 semi annual instalments of
` 1.46 crores each from 25 June 2019
to 25 June 2026.
53 13 58 12 10 half yearly instalments of ` 6.62 -
crores each from 30 September 2019
to 31 March 2024
- 1,729 1,626 - Repayable on 20 March 2020 -
300 76 361 73 10 half yearly instalments of ` 16.16 -
crores each from 19 July 2019 to
19 January 2024.
09 half yearly instalments of ` 22.04 -
crores each from 19 July 2019 to 19 July
2023 and 1 half yearly instalment of
` 16.74 crores on 19 January 2024.
172 35 198 34 11 equal semi annual instalments -
of ` 5.68 crores each from 09 July
2019 to 09 July 2024 and 1 semi
annual instalment of ` 5.00 crores on
09 January 2025
11 equal semi annual instalments
of ` 11.93 crores each from 09 July
2019 to 09 July 2024 and 1 semi
annual instalment of ` 8.65 crores on
09 January 2025
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at 31 March 2019 As at 31 March 2018
Non-Current Current Non-Current Current Terms of Repayments Security
231 102 313 9 11 equal semi annual instalments of -
` 3.17 crores each from 25 September
2019 to 25 September 2024 and 1 semi
annual instalment of ` 2.67 crores
on 25 March 2025
3 equal annual instalments of ` 92.23
crores from 13.8.2019 to 13.8.2021
12 equal semi annual instalments of
` 1.56 crores each from 25 September
2018 to 25 March 2025
- - - 85 1 yearly instalment of ` 84.72 crores
repaid on 26 July 2018.
37 9 48 10 10 equal semi annual instalments of -
` 4.65 crores each from 15 June 2019 to
15 December 2023.
493 463 98 Repayable in two tranches -
a.` 238.84 crores on 27 April 2020
b.` 253.76 crores on 27 April 2021
59 8 66 8 16 semi annual instalments of ` 4.24 -
crores each from 31 July 2019 to
31 January 2027
1,037 - 976 - 3 equal instalments of ` 345.86 crores -
each on 02 April 2020, 21 September
2020 and 21 March 2021
76 13 85 11 14 semi annual instalments of ` 4.33 -
crores each from 23 July 2019 to
23 January 2026
14 semi annual instalments of ` 2.03
crores each from 06 August 2019 to
05 February 2026
623 - 586 - Repayable in three tranches -
a.` 345.86 crores on 21 February 2022
b.` 34.59 crores on 06 March 2022
c.` 242.10 crores on 06 July 2022
1,452 - 650 - 04 annual instalments of ` 363.15 crores
from 12 October 2021 to 12 October 2024
277 - - - 04 annual instalments of ` 69.17 crores
from 12 July 2022 to 12 July 2025
865 - - - 04 annual instalments of ` 216.16 crores
from 16 July 2022 to 16 July 2025
692 - - - Repayable on 05 April 2024
519 - - - 04 equal installment of ` 129.70 crores
from 19 October 2022 to 19 October 2025
110 - - - 20 equal semi-annual installment of
` 5.51 crores from 31 August 2020 to
28 February 2030
78 - - - 20 equal semi-annual installment of
` 3.92 crores from 30 June 2020 to
31 December 2029
210 11 - - 20 equal semi-annual installment of
` 6.70 crores from 25 March 2020 to
25 September 2029
20 equal semi-annual installment of
` 4.34 crores from 25 March 2020 to
25 September 2029
168 - - - 20 equal semi-annual installment of
` 4.27 crores from 25 June 2020 to
25 December 2029
20 equal semi-annual installment
of ` 4.14 crores from 25 June
2020 to 25-12-2029
8,083 2,229 6,242 559
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at 31 March 2019 As at 31 March 2018
Non-Current Current Non-Current Current Terms of Repayments Security
Total Term Loan-Unsecured
8,483 2,849 6,242 1,459
Total Term Loan
17,123 4,616 15,551 3,207
C. Deferred Payment Liabilities
Deferred Sales Tax Loan (Unsecured)
21 31 46 18 Interest free loan and payable in 30 -
varying monthly instalments starting
from 12 April 2019 to 12 September 2021.
58 - 19 - Interest free loan Payable after 14 years
from receipt date
79 31 65 18
D. Financial Lease Obligations
4,211 417 4,223 359 Varying monthly instalments from 8 to
15 years (refer note 48)
E. Preference Shares
- - - 140 10% CRPS Redeemable at par in 2 equal -
quarterly instalments redeemed on 15
June 2018 and 15 September 2018
- 231 195 243 0.01% CRPS Redeemable at par in 4 -
quarterly instalments from 15 June
.2019,15 September 2019,15 December
2019,15 March 2020
- 231 195 383
F. Unamortised Upfront Fees on Borrowing
(124) (74) (128) (72) -
Total Amount in ` crores
26,748 9,821 29,551 4,458
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
21. Provisions
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars Non –current Current Non -current Current
Provision for employee benefits
Provision for compensated absences (refer note 40) 91 14 81 12
Provision for gratuity (refer note 40) 127 37 32 99
Provision for PF (refer note 40) - 1 - -
Other provisions
Mine closure provision 8 - 2 -
Total 226 52 115 111
Statutory income taxes are assessed based on book profits prepared under generally accepted accounting principles in India
adjusted in accordance with the provisions of the (Indian) Income Tax Act, 1961 Statutory income tax is charged at 30% plus a
surcharge and education cess.
MAT is assessed on book profits adjusted for certain items as compared to the adjustments followed for assessing regular income
tax under normal provisions. MAT for the fiscal year 2018-19 is 21.55%. MAT paid in excess of regular income tax during a year can be
set off against regular income taxes within a period of fifteen years succeeding the fiscal year in which MAT credit arises subject
to the limits prescribed.
Business loss can be carried forward for a maximum period of eight assessment years immediately succeeding the assessment
year to which the loss pertains. Unabsorbed depreciation can be carried forward for an indefinite period .
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
A reconciliation of income tax expense applicable to accounting profit before tax at the statutory income tax rate to recognised income
tax expense for the year indicated are as follows:
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Profit before tax 11,817 7,075
Enacted tax rate in India 34.94% 34.61%
Expected income tax expense at statutory tax rate 4,129 2,448
Expenses not deductible in determining taxable profit 28 154
Income not recognized in book profit 158 -
Income exempt from taxation/taxable separately (386) (228)
Tax holiday and allowances (371) (1)
Provision/(reversal) due to change in tax rate from 34.61% to 34.94% - 63
Tax provision/(reversal) for earlier years - 14
Tax expense for the year 3,558 2,450
Effective income tax rate 30.11% 34.63%
There are certain income-tax related legal proceedings which are pending against the company. Potential liabilities, if any have been
adequately provided for, and the company does not currently estimate any probable material incremental tax liabilities in respect of
these matters (refer note 44).
` in crores
Recognised in /
As at Recognised /
reclassified from As at
Deferred tax balance in relation to 31 March 2018 reversed through
other comprehensive 31 March 2018
profit and loss
income
Property, plant and equipment (9,255) (354) - (9,609)
Carried forward business loss/ unabsorbed depreciation 3,249 (2,135) - 1,114
Cash flow hedges / FCMITDA (123) - 130 7
Provisions for employee benefit / loans and 425 134 1 560
advances and guarantees
Finance Lease obligation 1,681 (80) - 1,601
Others (51) (15) - (67)
MAT credit entitlement 2,745 1,578 - 4,323
Total (1,329) (872) 131 (2,071)
The Company expects to utilize the MAT credit within a period of 15 years.
Deferred tax asset on long term capital losses of ` 203 crores and ` 2,025 crores expiring in fiscal year 2021-22 and 2024-25 respectively
has not been recognised in the absence of probable future taxable capital gains.
Deferred tax asset on short term capital losses of ` 689 crores expiring in fiscal year 2024-25 has not been recognised in the absence
of probable future taxable capital gains
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Advance from customer includes the amount relating to a five year Advance Payment and Supply Agreement (“APSA”) agreement with
Duferco S.A. for supply of Steel Products. Duferco S.A has provided an interest bearing advance amount of US $ 700 million under this
agreement. The advance and interest will be adjusted by export of steel products to Duferco S.A . Current portion of ` 763 crores has
been included in note 28.
Working capital loans of ` 727 crores (31 March 2018 ` 253 crores) are secured by:
i) pari passu first charge by way of hypothecation of stocks of raw materials, finished goods, work-in-process, consumables (stores
and spares) and book debts / receivables of the Company, both present and future.
ii) pari passu second charge on movable properties and immovable properties forming part of the property, plant and equipments
of the Company, both present and future except such properties as may be specifically excluded.
Disclosure pertaining to micro, small and medium enterprises (as per information available with the Company):
` in crores
Description As at 31 March 2019 As at 31 March 2018
Principal amount due outstanding as at end of year 30 10
Principal amount overdue more than 45 days - -
Interest due and unpaid as at end of year - #
Interest paid to the supplier - -
Payments made to the supplier beyond the appointed day during the year - -
Interest due and payable for the year of delay - -
Interest accrued and remaining unpaid as at end of year - -
Amount of further interest remaining due and payable in succeeding year - 1
# ` 0.28 crores
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
Description As at 31 March 2019 As at 31 March 2018
(b) Total outstanding, dues of creditors other than micro and small enterprises
Acceptances 8,926 8,098
Other than acceptances 4,096 5,880
Total 13,022 13,978
Acceptances include credit availed by the Company from banks for payment to suppliers for raw materials purchased
by the Company. The arrangements are interest-bearing and are payable within one year.
Payables Other than acceptances are normally settled within 180 days.
Trade payables from related parties details has been described in note 43.
Acceptances include credit availed by the Company from Banks for payment to suppliers for capital items. The arrangements are
interest-bearing and are payable within one year.
Advance from customer includes current portion ` 763 crores relating to APSA. Refer note 23.
Export obligation deferred income represents government assistance in the form of the duty benefit availed under Export Promotion
Capital Goods (EPCG) Scheme on purchase of property, plant and equipments accounted for as government grant and accounted in
revenue on fulfillment of export obligation. Refer note and being amortised over the useful life of such assets.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Product-wise turnover
For the year ended 31 March 2019 For the year ended 31 March 2018
Particulars Tonnes ` in crores Tonnes ` in crores
MS slabs 347,603 1,274 360,187 1,164
Hot rolled coils/steel plates/sheets* 8,756,033 39,316 8,549,548 34,102
Galvanized coils/sheets 463,278 2,527 473,098 2,389
Cold rolled coils/sheets 2,068,763 10,603 2,145,068 9,776
Steel billets & blooms 428,573 1,728 542,900 1,780
Long rolled products 3,691,473 16,762 3,551,250 13,957
Others - 2,560 - 3,067
Total 74,769 66,235
* Includes Hot rolled coils converted into SAW Pipes on Jobwork basis – Sales – NIL tonnes (previous year: 89,820 tonnes) Value – ` NIL (previous
year: `429 crores)
Note :
The State Government of Karnataka vide its circular dated 26 February 2019, has issued guidelines for determining the eligible
incentive amount under the GST regime.
The State Government of Maharashtra (‘GOM’) vide its Government Resolution (GR) dated 20 December 2018 issued the modalities
for sanction and disbursement of incentives, under GST regime, and introduced certain new conditions / restrictions for accruing
incentive benefits granted to the Company including denying incentives on related party transactions and certain other restrictions.
Subsequently, the GOM issued a corrigendum dated 08 March 2019 to the above mentioned GR allowing eligible units to claim
incentives on related party transactions.
The management has evaluated the impact of other conditions imposed and has obtained legal advice on the tenability of these
changes in the said scheme. Based on such legal advice, the Company has also made the representation to GOM and believes
that said Incentives would continue to be made available to the Company under the GST regime, since the new conditions are not
tenable legally and will contest these changes appropriately.
Accordingly, the Company has recognized grant income without giving effect to the above restrictions amounting to ` 161 crores
(previous year ` 110 crores) for the year ended 31 March 2019. The cumulative amount receivable towards the same as at 31
March 2019 amounting to ` 271 crores has been considered good and recoverable.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
However, the Company has determined that, in case of certain contracts, shipping services provided to customer is a separate
performance obligation and accordingly the revenue attributable to such shipping services has been recognised as Revenue from
operations, which was hitherto netted off against the corresponding freight expenses included as part of other expenditure in the
Statement of Profit and Loss. The Company has applied the full retrospective approach and restated the previous periods presented.
The restated revenue for the year ended 31 March 2018 is higher by ` 1,489 crores with the corresponding increase in Other
expenses. Further, the export benefits amounting to ` 300 crores for the year ended 31 March 2018 which was earlier included as
part of Revenue from sale of products has been reclassified to Other operating revenue
The above adjustments have no impact on the balance sheet and cash flow statement for the previous period.
The restated revenue and restated other expenses for the year ended 31 March 2018 are:
` in crores
For the year ended
Particulars
31 March 2018
Revenue from operations 67,723
Other expenses 13,993
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Revenue from contracts with customer - Sale of products (including shipping services) 74,769 66,235
Other operating revenue 1,958 1,488
Total revenue from operations 76,727 67,723
India 68,799 56,357
Outside India 7,928 11,366
Total revenue from operations 76,727 67,723
Timing of revenue recognition
At a point in time 76,727 67,723
Total revenue from operations 76,727 67,723
Contract Balances
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Trade Receivables (Gross) (refer note 13) 6,828 4,770
Contract liabilities
Advance from customers (refer note 23 and 28) 5,065 280
The credit period on sales of goods ranges from 7 to 60 days with or without security.
As at 31 March 2019, ` 82 crores (previous ` 78 crores) was recognised as provision for allowance for doubtful debts on trade receivables.
ontract liabilities include long term and short term advances received for sale of goods. The outstanding balances of these accounts
C
increased in due to the continuous increase in the customer base. Long term advances is detailed in note 23.
mount of revenue recognized from amounts included in the contract liabilities at the beginning of the year ` 232 crores (previous year
A
`260 crores) and performance obligations satisfied in previous years ` NIL (previous year ` NIL).
Out of the total contract liabilities outstanding as on 31 March 2019, ` 986 crores will be recognized by 31 March 2020, and
remaining thereafter.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Refund liabilities
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Arising from volume rebates and discount (included in Other Financial Liabilities- note 27) 637 527
The Company does not have any significant adjustments between the contracted price and revenue recognized in the Statement of
profit and loss account.
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Opening stock :
Semi-finished /finished goods 2,826 3,702
Work-in-progress 690 747
A 3,516 4,449
Closing stock :
Semi-finished /finished goods 3,228 2,826
Work-in-progress 476 690
B 3,704 3,516
C (A-B) (188) 933
Excise duty on stock of finished goods (net) D - (521)
C-D (188) 412
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Interest
Bonds and Debentures 734 810
Others 2,080 1,960
Dividend on redeemable preference shares 41 72
Interest on finance lease obligations 579 587
Unwinding of interest on financial liabilities carried at amortised cost 18 12
Exchange differences regarded as an adjustment to borrowing costs 141 22
Other borrowing costs 110 105
Interest on Income Tax 5 23
Total 3,708 3,591
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Stores and spares consumed 3,558 2,636
Power and fuel 5,746 4,771
Royalty/premium on captive mines 272 -
Rent 27 31
Repairs and maintenance
Plant and machinery 967 851
Buildings 33 25
Others 11 14
Insurance 66 52
Rates and taxes 60 44
Carriage and freight 3,549 3,419
Jobwork and processing charges 885 810
Commission on sales 29 41
Net loss/ (gain) on foreign currency transactions and translation # 450 88
Donations and contributions 24 3
CSR Expenditure 63 53
Miscellaneous expenses 1,129 857
Allowances for doubtful debts ,loans and advances (net) 132 144
Fair value Loss arising from financial instruments designated as FVTPL 18 30
Loss on sale of property, plant and equipment (net) 6 124
Total 17,025 13,993
# including hedging cost of ` 429 crores (previous year ` 223 crores)
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Note :
a) Auditors remuneration (excluding tax) included in miscellaneous expenses:
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Statutory audit fees (including limited reviews) 5 5
Tax audit fees * 1 #
Fees for capital market transactions and other certifications 2 1
Other services # -
Out of pocket expenses # #
Total 8 6
# represents amounts below ` 0.5 crores
* Tax audit fees ` 0.53 crores (previous year ` 0.46 crores)
` in crores
For the year ended 31 March 2019 For the year ended 31 March 2018
Yet to be Yet to be
Particulars In- Cash In- Cash
Paid in Cash Paid in Cash
(a) Gross amount required to be spend by the Company during the year 63 35
(b) Amount spend on:
(i) Construction / acquisition of assets - - - -
(ii) On purposes other than (i) above (for CSR projects) 54 9 44 9
The number of options granted to each eligible employee is determined by dividing the Award Value (amount equivalent to
percentage of Annual Fix Pay) by the Fair Value of option provided. The Fair Value of option on the date of each grant is determined
by using Black Scholes model.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
ESOP is the primary arrangement under which shared plan service incentives are provided to certain specified employees
of the Company and it’s subsidiaries in India.
Three grants would be made under ESOP plan 2016 to eligible employees on the rolls of the Company as at 01 April 2016, 01
April 2017 and 01 April 2018.
The maximum value and share options that can be awarded to eligible employees is calculated by reference to certain percentage
of individuals fixed salary compensation. 50% of the grant would vest at the end of the third year and 50% of the grant would vest
at the end of the fourth year with a vesting condition that the employee is in continuous employment with the Company till the
date of vesting.
The exercise price is determined by the ESOP committee at a certain discount to the primary market price on the date of grant.
A total of 28,687,000 options are available for grant to the eligible employees of the Company and a total of 3,163,000 options
would be available for grant to the eligible employees of the Indian subsidiaries of the Company under the ESOP Plan.
These options are equity settled and are accounted for in accordance with the requirement applying to equity settled transactions.
The details of an employee share based payments plan operated through a trust for ESOP 2016 are as follows:
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
ESOP 2016
Particulars
1st Grant 2nd Grant 3rd Grant
Vesting Period 17 May 2016 till 31 March 2019 16 May 2017 till 31 March 2020 14 May 2018 till 31 March 2021
(for 50% of the grant) and 17 (for 50% of the grant) and 16 (for 50% of the grant) and 14
May 2016 to 31 March 2020 (for May 2017 to 31 March 2021 (for May 2018 to 31 March 2022 (for
remaining 50% of the grant) remaining 50% of the grant) remaining 50% of the grant)
Exercise Period 4 years from vesting date 4 years from vesting date 4 years from vesting date
Weighted average remaining contract life 54 months 66 months 78 months
Exercise price 103.65 161.36 263.24
Weighted average share price on exercise date Not applicable Not applicable Not applicable
A description of the method and significant The fair value of options has The fair value of options has The fair value of options has
assumptions used during the year to estimate been calculated by using been calculated by using been calculated by using
the fair value of options including the Black Schole’s Method. Black Schole’s Method. Black Schole’s Method.
following information: The assumptions used The assumptions used The assumptions used
in the above are: in the above are: in the above are:
Weighted-average values of share price Not applicable Not applicable Not applicable
Weighted-average exercise price Not applicable Not applicable Not applicable
Expected volatility Volatility was calculated using Volatility was calculated using Volatility was calculated using
standard deviation of daily standard deviation of daily standard deviation of daily
change in stock price. change in stock price. change in stock price.
The volatility used for valuation The volatility used for valuation The volatility used for valuation
is 39.23 % for options with 3 is 33.76 % for options with 3 is 33.23 % for options with 3
year vesting and 39.62 % with year vesting and 37.43 % with year vesting and 33.28 % with
4 years vesting 4 years vesting 4 years vesting
Expected option life The expected option life is The expected option life is The expected option life is
assumed to be mid-way assumed to be mid-way assumed to be mid-way
between the option vesting between the option vesting between the option vesting
and expiry. Since the vesting and expiry. Since the vesting and expiry. Since the vesting
period and contractual term period and contractual term period and contractual term
of each tranche is different, of each tranche is different, of each tranche is different,
the expected life for each the expected life for each the expected life for each
tranche will be different. tranche will be different. tranche will be different.
The expected option life is The expected option life is The expected option life is
calculated as (Year to Vesting + calculated as (Year to Vesting + calculated as (Year to Vesting +
Contractual Option Term)/2 Contractual Option Term)/2 Contractual Option Term)/2
Expected dividends ` 1.10 per share Re. 0.75 per share ` 2.25 per share
Risk-free interest rate Zero coupon sovereign bond Zero coupon sovereign bond Zero coupon sovereign bond
yields were utilized with yields were utilized with yields were utilized with
maturity equal to expected maturity equal to expected maturity equal to expected
term of the option term of the option term of the option
The rate used for calculation is The rate used for calculation is The rate used for calculation is
7.36% (for 3 years vesting) & 6.87% (for 3 years vesting) & 7.85% (for 3 years vesting) &
7.44%(for 4 years vesting) 6.96%(for 4 years vesting) 7.92%(for 4 years vesting)
The method used and the assumptions made to Black-Scholes Black-Scholes Black-Scholes
incorporate the effects of expected early exercise Options pricing model Options pricing model Options pricing model
How expected volatility was determined, including The following factors have been considered:
an explanation of the extent to which expected (a) Share price
volatility was based on historical volatility (b) Exercise prices
Whether and how any other features of the option (c) Historical volatility
grant were incorporated into the measurement of (d) Expected option life
fair value, such as a market condition (e) Dividend Yield
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018*
Domestic 68,799 56,357
Export 7,928 11,366
Total 76,727 67,723
* Restated (refer note 29)
Revenue from operations have been allocated on the basis of location of customers.
b) Non-current assets
All non-current assets other than financial instruments of the Company are located in India.
Company’s contribution to provident fund & family pension scheme recognized in statement of profit and loss of ` 47 crores (31
March 2018: ` 42 crores) (included in note 32).
Contribution towards Company owned trust is detailed in Defined benefit plans
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at 31
March 2019 by Independent, Qualified Actuary. The present value of the defined benefit obligation, and the related current service
cost and past service cost, were measured using the projected unit credit method.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
f) Experience adjustments:
` in crores
Particulars 2018-19 2017-18 2016-17 2015-16 2014-15
Defined benefit obligation 231 196 175 143 126
Plan assets 68 65 53 50 40
Surplus / (deficit) (164) (131) (122) (93) (85)
Experience adjustments on plan liabilities – Loss/(gain) 14 3 17 3 23
Experience adjustments on plan assets – Gain/(loss) # # # # #
# represents amounts below ` 0.5 crores
g) The Company expects to contribute ` 37 crores (previous year ` 32 crores) to its gratuity plan for the next year.
h) In assessing the Company’s post retirement liabilities, the Company monitors mortality assumptions and uses up-to-date mortality
tables, the base being the Indian assured lives mortality (2006-08) ultimate.
i) Expected return on plan assets is based on expectation of the average long term rate of return expected on investments of the
fund during the estimated term of the obligations after considering several applicable factors such as the composition of plan
assets, investment strategy, market scenario, etc.
j) The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other
relevant factors, such as supply and demand in the employment market.
k) The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the
estimated term of the obligations.
The amount included in the financial statements arising from the entity’s obligation in respect of its defined benefit plan is as follows:
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Defined benefit obligation 231 196
Plan assets 68 65
- net liability/(asset) arising from defined benefit obligation 164 131
Sensitivity Analysis:
Significant actuarial assumptions for the determination of the defined benefit obligation are discount rate, expected salary increase and
mortality. The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumptions
occurring at the end of the reporting year, while holding all other assumptions constant.
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars Increase Decrease Increase Decrease
Discount rate (1% movement) (18) 21 (16) 18
Future salary growth (1% movement) 21 (18) 18 (16)
Attrition rate (1% movement) 3 (3) 3 (3)
The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely
that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.
Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using
the projected unit credit method at the end of the reporting year, which is the same as that applied in calculating the defined benefit
obligation recognised in the balance sheet.
There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Fund Allocation
Particulars SBI HDFC ICICI LIC
As on 31 March 2019 68.76% 9.68% 8.57% 12.99%
As on 31 March 2018 73.27% 9.25% 3.98% 13.49%
Each year an Asset-Liability-Matching study is performed in which the consequences of the strategic investment policies are analysed
in terms of risk and return profiles.
The members of the Provident Fund Trust are entitled to the rate of interest declared by the Central Government under the
Employees Provident Funds and Miscellaneous Provisions Act, 1952. The shortfall, if any, is made good by the Company in the year
in which it arises.
As per Ind AS 19 on “Employee Benefits”, employer established provident fund trusts are treated as defined benefit plans,
since the Company is obliged to meet interest shortfall, if any, with respect to covered employees. According to the defined
benefit obligation of interest rate guarantee on exempted provident fund in respect of employees of the Company as at 31
March 2019 is 8.65%.
Out of the total contribution made for Provident Fund in Defined Contribution Plan, ` 20 crores (previous year ` 17 crores) is made
to the JSW Steel Employees Provident Fund Trust.
The funds of the Trust have been invested under various securities in accordance with the rules prescribed by the Government of India.
The Company has obtained the actuarial valuation of interest rate obligation in respect of Provident Fund and interest rate
guarantee shortfall of ` 1 crores (Previous year - Nil) is recognised in the Statement of Profit and Loss.
Actuarial assumptions made to determine interest rate guarantee on exempt provident fund liabilities are as
follows:
Particulars As at 31 March 2019 As at 31 March 2018
Total plan assets @ 505 453
Total plan liabilities @ 499 435
Discount rate 7.79% 7.85%
Rate of return on assets 8.55% 8.88%
Guaranteed rate of return 8.65% 8.55%
@ JSW Steel Employees Provident Fund Trust as at 31 March 2019 as per the unaudited financial statements
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The Company’s capital requirement is mainly to fund its capacity expansion, repayment of principal and interest on its borrowings
and strategic acquisitions. The principal source of funding of the Company has been, and is expected to continue to be, cash
generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not
subject to any externally imposed capital requirements.
The Company regularly considers other financing and refinancing opportunities to diversify its debt profile, reduce interest cost
and elongate the maturity of its debt portfolio, and closely monitors its judicious allocation amongst competing capital expansion
projects and strategic acquisitions, to capture market opportunities at minimum risk.
The Company monitors its capital using gearing ratio, which is net debt, divided to total equity. Net debt includes, interest bearing
loans and borrowings less cash and cash equivalents, bank balances other than cash and cash equivalents and current investments.
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Long term borrowings 26,748 29,551
Current maturities of long term debt and finance lease obligations 9,821 4,458
Short term borrowings 5,368 2,172
Less: Cash and cash equivalent (5,258) (451)
Less: Bank balances other than cash and cash equivalents (422) (150)
Net debt 36,257 35,580
Total equity 35,162 27,907
Gearing ratio 1.03 1.27
(i) Equity includes all capital and reserves of the Company that are managed as capital.
(ii) Debt is defined as long and short term borrowings (excluding derivatives and financial guarantee contracts), as described in
notes 19 and 24.
As at 31 March 2019
` in crores
Fair value
Derivatives Total
Amortised through other Fair value through Total carrying
Particulars in hedging fair value
cost comprehensive profit and loss value
relationship
income
Financial assets
Investments 374 633 417 - 1,424 1,425
Trade receivables 6,746 - - - 6,746 6,746
Cash and cash equivalents 5,258 - - - 5,258 5,258
Bank balances other than cash 422 - - - 422 422
and cash equivalents
Loans 7,810 - - - 7,810 7,810
Derivative Assets - - 147 81 228 228
Other financial assets 2,666 - - - 2,666 2,666
Total 23,276 633 564 81 24,554 24,555
Financial liabilities
Long term Borrowings * 36,569 - - - 36,569 37,357
Short term Borrowings 5,368 - - - 5,368 5,368
Trade payables 13,052 - - - 13,052 13,052
Derivative liabilities - - 296 36 332 332
Other financial liabilities 4,980 - - - 4,980 4,980
Total 59,969 - 296 36 60,301 61,089
* including current maturities of long term debt and finance lease obligations
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
As at 31 March 2018
` in crores
Fair value
Derivatives Total
Amortised through other Fair value through Total carrying
Particulars in hedging fair value
cost comprehensive profit and loss value
relationship
income
Financial assets
Investments # 680 350 - 1,030 1,030
Trade receivables 4,692 - - - 4,692 4,692
Cash and cash equivalents 451 - - - 451 451
Bank balances other than cash 150 - - - 150 150
and cash equivalents
Loans 5,323 - - - 5,323 5,323
Derivative Assets - - 85 62 147 147
Other financial assets 1,249 - - - 1,249 1,249
Total 11,865 680 435 62 13,042 13,042
Financial liabilities
Long term borrowings * 34,009 - - - 34,009 34,709
Short term borrowings 2,172 - - - 2,172 2,172
Trade payables 13,988 - - - 13,988 13,988
Derivative liabilities - - 32 58 90 90
Other financial liabilities 3,351 - - - 3,351 3,352
Total 53,520 - 32 58 53,610 54,311
* including current maturities of long term debt and finance lease obligations
# represents amounts below ` 0.5 crores
The risk management policies aims to mitigate the following risks arising from the financial instruments:
- Market risk
- Liquidity risk
The Company seeks to minimize the effects of these risks by using derivative financial instruments to hedge risk exposures. The use
of financial derivatives is governed by the Company’s policies approved by the Board of Directors, which provide written principles
on foreign exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments,
and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the Management and the
internal auditors on a continuous basis. The Company does not enter into or trade financial instruments, including derivatives for
speculative purposes.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Adverse movements in the exchange rate between the Rupee and any relevant foreign currency result’s in increase in the
Company’s overall debt position in Rupee terms without the Company having incurred additional debt and favourable movements
in the exchange rates will conversely result in reduction in the Company’s receivables in foreign currency. In order to hedge
exchange rate risk, the Company has a policy to hedge cash flows up to a specific tenure using forward exchange contracts and
options. At any point in time, the Company hedges its estimated foreign currency exposure in respect of forecast sales over the
following 6 months. In respect of imports and other payables, the Company hedges its payables as when the exposure arises.
Short term exposures are hedged progressively based on their maturity.
All hedging activities are carried out in accordance with the Company’s internal risk management policies, as approved by the
Board of Directors, and in accordance with the applicable regulations where the Company operates.
The carrying amounts of the Company’s monetary assets and monetary liabilities at the end of the reporting year are as follows:
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The following table details the Company’s sensitivity to a 1% increase and decrease in the INR against the relevant foreign currencies
net of hedge accounting impact. 1% is the sensitivity rate used when reporting foreign currency risk internally to key management
personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity
analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end for
a 1% change in foreign currency rates, with all other variables held constant. A positive number below indicates an increase in profit
or equity where INR strengthens 1% against the relevant currency. For a 1% weakening of INR against the relevant currency, there
would be a comparable impact on profit or equity, and the balances below would be negative.
` in crores
Increase Decrease
Particulars
31 March 2019 31 March 2018 31 March 2019 31 March 2018
Receivable
USD/INR 90 57 (90) (57)
Payable
USD/INR 108 99 (108) (99)
The forward exchange contracts entered into by the Company and outstanding are as under:
US$ Equivalent INR Equivalent MTM
As at Nature No. of Contracts Type
(Millions) (crores) (` in crores)
18 Buy 175 1,207 4
Assets
48 Sell 503 3,481 159
31 March 2019
125 Buy 1,207 8,351 (304)
Liabilities
0 Sell 0 0 0
42 Buy 463 3,015 20
Assets
37 Sell 443 2,879 25
31 March 2018
60 Buy 670 4,358 (24)
Liabilities
31 Sell 339 2,205 (17)
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The Company is subject to fluctuations in prices for the purchase of iron ore, coking coal, ferro alloys, zinc, scrap and other raw
material inputs. The Company purchased primarily all of its iron ore and coal requirements at prevailing market rates during the year
ended 31 March 2019.
The Company aims to sell the products at prevailing market prices. Similarly the Company procures key raw materials like iron ore
and coal based on prevailing market rates as the selling prices of steel prices and the prices of input raw materials move in the
same direction.
Commodity hedging is used primarily as a risk management tool to secure the future cash flows in case of volatility by entering
into commodity forward contracts.
Hedging commodity is based on its procurement schedule and price risk. Commodity hedging is undertaken as a risk offsetting
exercise and, depending upon market conditions hedges, may extend beyond the financial year. The Company is presently hedging
maximum up to 25 % of its consumption.
The following table details the Company’s sensitivity to a 5% movement in the input price of iron ore and coking coal. The sensitivity
analysis includes only 5% change in commodity prices for quantity purchased or consumed during the year, with all other variables
held constant. A positive number below indicates an increase in profit or equity where the commodity prices decrease by 5%
and vice-versa.
` in crores
Increase for the year ended Decrease for the year ended
Commodity 31 March 2019 31 March 2018 31 March 2019 31 March 2018
Iron ore lumps/fines 611 598 (611) (598)
Coal/Coke 1,178 1,027 (1,178) (1,027)
The commodity forward and option contracts entered into by the Company and outstanding at the year-end are as under:
Quantity
MTM of
(Iron Ore, Coking US$ Equivalent INR
No. of Commodity Commodity
As at Nature Coal - MT) of notional value equivalent
Contracts Name contract
(Brent Crude - Mio (Millions) (crores)
(` in crores)
Barrels)
1 BRENT CRUDE 45,000 2 17 4
31 March 2019 Assets
6 COKING COAL 45,000 9 65 #
5 BRENT CRUDE 1,68,750 10 68 6
Assets
31 March 2018 3 IRON ORE 1,16,000 7 47 1
Liabilities 44 IRON ORE 13,46,000 92 601 (43)
# represents amounts below ` 0.5 crores
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The following table provides a break-up of the Company’s fixed and floating rate borrowings:
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Fixed rate borrowings 19,663 19,723
Floating rate borrowings 17,104 14,486
Total gross borrowings 36,767 34,209
Less: Upfront fees (198) (200)
Total borrowings (refer note 19) 36,569 34,009
The sensitivity analyses below have been determined based on the exposure to interest rates for floating rate liabilities, after the
impact of hedge accounting, assuming the amount of the liability outstanding at the year-end was outstanding for the whole year.
If interest rates had been 100 basis points higher / lower and all other variables were held constant, the Company’s profit for the
year ended 31 March 2019 would decrease / increase by ` 171 crores (for the year ended 31 March 2018: decrease / increase by
` 145 crores). This is mainly attributable to the Company’s exposure to interest rates on its variable rate borrowings
The following table details the nominal amounts and remaining terms of interest rate swap contracts outstanding at the year-end.
US$ Equivalent of MTM of IRS
As at Nature No. of Contracts
notional value (Millions) (` in crores)
31 March 2019 Assets 13 220 20
Liablities 15 245 (27)
31 March 2018 Assets 14 237 37
Liabilities 5 128 (2)
The Company is exposed to credit risk for trade receivables, cash and cash equivalents, investments, other bank balances, loans,
other financial assets, financial guarantees and derivative financial instruments.
Moreover, given the diverse nature of the Company’s business trade receivables are spread over a number of customers with
no significant concentration of credit risk. No single customer (other than the Group Companies) accounted for 10% or more of
the trade receivables in any of the years presented. The history of trade receivables shows a negligible provision for bad and
doubtful debts. Therefore, the Company does not expect any material risk on account of non-performance by any of the Company’s
counterparties.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
For current investments, counterparty limits are in place to limit the amount of credit exposure to any one counterparty.
This, therefore, results in diversification of credit risk for Company’s mutual fund and bond investments. For derivative and financial
instruments, the Company attempts to limit the credit risk by only dealing with reputable banks and financial institutions.
The carrying value of financial assets represents the maximum credit risk. The maximum exposure to credit risk was ` 24,554
crores as at 31 March 2019 and ` 13,042 crores as at March 31, 2018, being the total carrying value of trade receivables, balances
with bank, bank deposits, Current investments and other financial assets.
In respect of financial guarantees provided by the Company to banks and financial institutions, the maximum exposure
which the Company is exposed to is the maximum amount which the Company would have to pay if the guarantee is called upon.
Based on the expectation at the end of the reporting period, the Company considers that it is more likely than not that such an
amount will not be payable under the guarantees provided.
Receivables are deemed to be past due or impaired with reference to the Company’s normal terms and conditions of business.
These terms and conditions are determined on a case to case basis with reference to the customer’s credit quality and prevailing
market conditions. The Company based on past experiences does not expect any material loss on its receivables and hence no
provision is deemed necessary on account of ECL.
The credit quality of the Company’s customers is monitored on an ongoing basis and assessed for impairment where indicators of
such impairment exist. The Company uses simplified approach for impairment of financial assets. If credit risk has not increased
significantly, 12-month expected credit loss is used to provide for impairment loss. However, if credit risk has increased significantly,
lifetime expected credit loss is used. The solvency of the debtor and their ability to repay the receivable is considered in assessing
receivables for impairment. Where receivables have been impaired, the Company actively seeks to recover the amounts in question
and enforce compliance with credit terms.
The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed
repayment years and its non-derivative financial assets. The tables have been drawn up based on the undiscounted cash flows of
financial liabilities based on the earliest date on which the Company can be required to pay. The tables include both interest and
principal cash flows.
To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the
reporting year. The contractual maturity is based on the earliest date on which the Company may be required to pay.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The amount of guarantees/standby letter of credit given on behalf of subsidiaries included in Note 45 represents the maximum
amount the Company could be forced to settle for the full guaranteed amount. Based on the expectation at the end of the reporting
year, the Company considers that it is more likely than not that such an amount will not be payable under the arrangement.
Collateral
The Company has pledged part of its trade receivables, short term investments and cash and cash equivalents in order to fulfil
certain collateral requirements for the banking facilities extended to the Company. There is obligation to return the securities
to the Company once these banking facilities are surrendered. (Refer note 19 and 24).
` in crores
Particulars As at 31 March 2019 As at 31 March 2018 Level Valuation techniques and key inputs
Quoted investments in equity shares 620 666 1 Quoted bid prices in an active market
measured at FVTOCI
Unquoted investments in equity shares 9 9 3 Net Asset value of share arrived has been
measured at FVTOCI considered as fair value
Unquoted investments in equity shares 5 5 3 Cost is approximate estimate
measured at FVTOCI of fair value,
Non-current investments in unquoted 417 350 3 Discounted cash flow - Future cash
preference shares measured at FVTPL flows are based on terms of Preference
Shares discounted at a rate that
reflects market risks
Derivative Assets 228 147 2 Inputs other than quoted prices included
within level 1 that are observable for asset
Derivative Liabilities 332 90 or liability, either directly (i.e. as prices) or
indirectly (derived from prices).
The carrying amounts of trade receivables, trade payables, capital creditors, cash and cash equivalents, other bank balances, other
financial assets and other financial liabilities (other than those specifically disclosed) are considered to be the same as their fair values,
due to their short term nature.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Details of Financial assets/ liabilities measured at amortized cost but fair value disclosed in category wise
` in crores
Particulars As at 31 March 2019 As at 31 March 2018 Level Valuation techniques and key inputs
Loans
Carrying value 7,810 5,323 Discounted cash flow on observable
Future cash flows are based on
Fair value 7,810 5,323 2 terms of discounted at a rate that
reflects market risks
Investments Discounted cash flow on observable
Carrying value - Future cash flows are based on
374 2
terms of discounted at a rate that
Fair value 375 - reflects market risks
Long Term Borrowing Discounted cash flow on observable
Carrying value 36,570 34,009 Future cash flows are based on
2 terms of discounted at a rate that
Fair value 37,357 34,709 reflects market risks
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
300
` in crores
Subsidiaries Joint Ventures Other related parties* Total
Particulars
FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18
NOTES
Purchase of goods / power & fuel / services
Amba River Coke Limited 4,416 4,405 - - - - 4,416 4,405
9 - - 9
301
` in crores
302
Subsidiaries Joint Ventures Other related parties* Total
Particulars
FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18
Investments / share application money given during the period
NOTES
Creixent Special Steels Limited 5 - 370 - - - 375 -
JSW Reality & Infrastructure Private Limited 103 - - - - - 103 -
Dolvi Minerals & Metals Private Limited 359 - - - - - 359 -
Notes:
STATUTORY REPORTS
2. The Company maintains gratuity trust for the purpose of administering the gratuity payment to its employees (JSW Steel Group Gratuity Trust and JSW Steel Limited Employee Gratuity
Fund). During the year, the Company contributed ` 3 crores (FY 2017-18: ` 13 crores).
3. In view of the uncertainty involved in collectability, revenue as interest income of ` 454 crores have not been recognised on loan provided to certain overseas subsidiaries.
303
A VISION TO EXECUTE BETTER. EVERYDAY.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
Particulars FY 2018-19 FY 2017-18
Nature of transaction
Short-term employee benefits 86 95
Post-employment benefits 1 1
Other long-term benefits - -
Termination benefits - -
Share-based payment - -
Total compensation to key management personnel 87 96
Notes:
1. As the future liability for gratuity is provided on an actuarial basis for the company as a whole, the amount pertaining to individual
is not ascertainable and therefore not included above.
2. The remuneration includes perquisite value of ESOPs in the year it is exercised ` Nil (previous year ` 32 crores). The Company
has recognised an expenses of ` 4 crores (previous year ` 2 crores) towards employee stock options granted to Key Managerial
Personnel. The same has not been considered as managerial remuneration of the current year as defined under Section 2(78)
of the Companies Act, 2013 as the options have not been exercised.
3. Dividend paid to key management personnel is `0.14 crores (previous year ` 0.09 crores), not included above.
4. The Independent Non-Executive Directors are paid remuneration by way of commission and sitting fees. The commission payable
to the Non-Executive Directors is based on the number of meetings of the Board attended by them and their Chairmanship/
Membership of Audit Committee during the year, subject to an overall ceiling of 1% of the net profits approved by the Members.
The Company pays sitting fees at the rate of ` 20,000/- for each meeting of the Board and sub-committees attended by them.
The amount paid to them by way of commission and sitting fees during FY 2018-19 is ` 3 crores (FY 2017-18 is ` 4 crores), which is
not included above.
Sales:
The sales to related parties are made on terms equivalent to those that prevail in arm’s length transactions and in the ordinary course of
business. Sales transactions are based on prevailing price lists and memorandum of understanding signed with related parties. For the
year ended 31st March 2019, the Company has not recorded any impairment of receivables relating to amounts owed by related parties.
Purchases:
The purchases from related parties are made on terms equivalent to those that prevail in arm’s length transactions and in the ordinary
course of business. Purchase transactions are based on made on normal commercial terms and conditions and market rates.
Guarantees to subsidiaries:
Guarantees provided to the lenders of the subsidiaries are for availing term loans and working capital facilities from the lender banks.
The transactions other than mentioned above are also in the ordinary course of business and at arms’ length basis.
Trade receivables
Peddar Realty Private Limited 155 155 - - - - 155 155
JSW Steel Coated Products Limited 700 447 - - - - 700 447
Others - 9 129 70 190 141 319 219
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
305
Total 655 650 66 28 302 362 1,024 1,040
` in crores
306
Subsidiaries Joint Ventures Other related parties Total
Particulars
31st March, 2019 31st March, 2018 31st March, 2019 31st March, 2018 31st March, 2019 31st March, 2018 31st March, 2019 31st March, 2018
Loan given
NOTES
Inversiones Eurosh Limitada 744 694 - - - - 744 694
Periama Holdings, LLC 4,936 3,988 - - - - 4,936 3,988
JSW Steel (Netherlands) B.V. 1,318 525 - - - - 1,318 525
Interest receivable
Inversiones Eurosh Limitada 192 181 - - - - 192 181
Periama Holdings, LLC 396 372 - - - - 396 372
Others 49 28 - - - - 49 28
Total 637 581 - - - - 637 581
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Excise Duty 448 414
Custom Duty 456 514
Income Tax 18 18
Sales Tax / VAT / Special Entry tax 1,243 156
Service Tax 598 593
Miscellaneous - #
Levies by local authorities – Statutory 2 3
Levies relating to Energy / Power Obligations 208 317
Claims by suppliers and other parties 42 42
Total 3,015 2,057
represents amounts below ` 0.5 crores
#
a) Excise duty cases includes disputes pertaining to availment of CENVAT credit, valuation methodologies, classification of gases
under chapter heading.
b) Custom duty cases includes disputes pertaining to import of Iron ore fines and lumps under wrong heading, utilisation of
SHIS licences for clearance of imported equipment, payment of customs duty for Steam Coal through Krishnapatnam Port and
anti-dumping duty on Met Coke used in Corex.
c) Sales Tax/ VAT/ Special Entry tax cases includes disputes pertaining to demand of special entry tax in Karnataka and demand of
cess by department of transport in Goa.
d) Service Tax cases includes disputes pertaining to availment of service tax credit on ineligible services, KKC amount paid but no
credit not availed, denial of credit distributed as an ISD, service tax on railway freight not taken as per prescribed documents.
e) Income Tax cases includes disputes pertaining to transfer pricing, deduction u/s 80-IA and other matters.
f) Levies by local authorities - Statutory cases includes disputes pertaining to payment of water charges and enhanced compensation.
g) Levies relating to Energy / Power Obligations cases includes disputes pertaining to uninterrupted power charges by Karnataka
Power Transmission Company Ltd., belated payment surcharge, claims for the set off of renewable power obligations against
the power generated in its captive power plants and dues relating to additional surcharge imposed on captive consumption by
Maharashtra State Electricity Distribution Company Ltd.
i) Claims by Suppliers and other parties includes quality claims issues raised by suppliers and others.
j) There are several other cases which has been determined as remote by the Company and hence not been disclosed above.
In response to a petition filed by the iron ore mine owners and purchasers (including the Company) contesting the levy of Forest
Development Tax (FDT) on iron ore on the ground that the State does not have jurisdiction to legislate in the field of major minerals
which is a central subject, the Honourable High Court of Karnataka vide its judgement dated 3 December 2015 directed refund
of the entire amount of FDT collected by Karnataka State Government on sale of iron ore by private lease operators and National
Mineral Development Corporation Limited (NMDC). The Karnataka State Government has filed an appeal before the Supreme Court
of India (“SCI”). SCI has not granted stay on the judgement but stayed refund of FDT. The matter is yet to be heard by SCI. Based on
merits of the case and supported by a legal opinion, the Company has not recognised provision for FDT of ` 1,043 crores (including
paid under protest – ` 665 crores) and treated it as a contingent liability.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The State of Karnataka on 27 July 2016, has amended Section 98-A of the Forest Act retrospectively substituting the levy as Forest
Development Fee (FDF) instead of FDT. In response to the writ petition filed by the Company and others, the Honourable High Court
of Karnataka has vide its order dated 4 October 2017, held that the amendment is ultra-vires the Constitution of India and directed
the State Government to refund the FDF collected. The State Government has filed an appeal before the SCI, and based on merits
of the case duly supported by a legal opinion and a favorable order from the High Court, the Company has not recognised provision
for FDF amount of ` 1,117 crores (including paid under protest - ` 255 crores) pertaining to the private lease operators & NMDC and
treated it as contingent liability.
(iii) Supreme Court (SC) passed a judgement dated 28 February 2019, relating to components of salary structure that need to be taken
into account while computing the contribution to provident fund under the EPF Act. There are numerous interpretative issues
relating to the Supreme Court (SC) judgement including the effective date of application. The Company continues to assess any
further developments in this matter for the implications on financial statements, if any.
46. Commitments
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Estimated amount of contracts remaining to be executed on capital account and not provided for 13,948 9,801
(net of advances)
Other commitments:
(a) The Company from time to time provides need based support to subsidiaries and joint ventures entity towards capital and
other requirements.
(b) The Company entered a five year Advance Payment and Supply Agreement (“APSA”) agreement with Duferco S.A. (“DSA”) for supply
of Steel Products. Duferco S.A has provided an interest bearing advance amount of US $ 700 million under this agreement, secured
by committed export of steel products to Duferco S.A .
(c) The Company has imported capital goods under the export promotion capital goods scheme to utilise the benefit of a zero or
concessional customs duty rate. These benefits are subject to future exports within the stipulated year. Such export obligations
at year end aggregate to
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Export promotion capital goods scheme 10,146 4,455
(d) The Company has given guarantees aggregating ` 127 crores (previous year ` 127 crores) on behalf of subsidiaries to Commissioner
of Customs in respect of goods imported.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
The agreements are renewable & cancellable by mutual consent of both parties. The rent paid on above is based on mutually agreed rates.
b) As lessee:
(i) Lease rentals charged to profit and loss for right to use following assets are:
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Office premises, residential flats etc. 18 22
Total: 18 22
The agreements are executed for a period of 11 to 180 months with a renewable clause and also provide for termination at will by either
party giving a prior notice period of 1 to 3 months.
(ii) The agreements for certain plant and equipment is on non-cancellable basis for a period of 10-15 years, which are renewable on
expiry of the lease period at mutually acceptable terms.
Lease rentals charged to profit and loss for right to use these assets are
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Property, plant and equipment 9 9
Total: 9 9
Future minimum rentals payable under non-cancellable operating leases are as follows:
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Not later than one year 5 6
Later than one year but not later than five years 6 11
Later than five years - -
Total 11 17
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
48. The Company has evaluated certain arrangements for purchase or processing of raw materials based on facts and circumstances
existing at the date of transition to Ind AS and have identified them in the nature of lease as the fulfillment of the arrangements
depend upon a specific asset and the Company has committed to obtain substantially all the production capacity of the asset.
After separating lease payments from the other elements in these arrangements, the Company has recognized plant and equipment
and building as Assets taken under finance leases (refer note 4). In certain arrangements related to purchase or processing of raw
materials, the Company also has an option to purchase the said assets at the end of the lease term.
The minimum lease payments and the present value of minimum lease payments as at 31 March 2019 in respect of aforesaid plant
and equipment acquired under the finance leases are as follows:
` in crores
As at 31 March 2019 As at 31 March 2018
Present value of Present value of
Minimum lease Minimum lease
minimum lease minimum lease
payments payments
payments payments
Not later than 1 year 985 418 916 362
Later than one year but not later than five years 3,769 2,092 3,864 2,142
Later than five years 3,082 2,118 3,111 2,078
Total 7,836 4,628 7,891 4,582
Less: Future finance charges 3,208 3,309
Total: 4,628 4,582
49. During the previous year a subsidiary of the Company had surrendered one of its iron ore mine in Chile considering its economic
viability and accordingly the Company had reassessed the recoverability of the loans given to and investments made in subsidiaries
and recognised an impairment provision of ` 234 crores which was disclosed as an exceptional item.
50. In assessing the carrying amounts of Investments in and loans / advances (net of impairment loss / loss allowance) to certain
subsidiaries and a Joint Venture and financial guarantees to certain subsidiaries (listed below), the Company considered various
factors as detailed there against and concluded they are recoverable.
(a) Investments aggregating to ` 259 crores (` 259 crores as at March 31, 2018) in equity and preference shares of JSW Steel
(Netherlands) B.V (“NBV”), loans of ` 848 crores (` 209 crores as at March 31, 2018), ` 5,332 crores (` 4,361 crores as at March 31,
2018) and ` 739 crores (` 678 crores as at March 31, 2018) to NBV, Periama Holdings LLC (“PHL”) and JSW Panama Holdings
Corporation respectively and the financial guarantees of ` 1,410 crores (` 1,626 crores as at March 31, 2018) and ` NIL (` 85 crores
as at March 31, 2018) on behalf of PHL and JSW Steel (USA) Inc. respectively – Estimate of values of the businesses and assets by
independent external valuers based on cash flow projections/implied multiple approach. In making the said projections, reliance
has been placed on estimates of future prices of iron ore and coal, mineable resources, and assumptions relating to operational
performance including significant improvement in capacity utilisation and margins based on forecasts of demand in local markets,
and capacity expansion/availability of infrastructure facilities for mines.
(b) Equity shares of JSW Steel Bengal Limited, a subsidiary (carrying amount: ` 446 crores (` 442 crores as at March 31, 2018)) -
Evaluation of the status of its integrated Steel Complex (including power plant) to be implemented in phases at Salboni of district
Paschim Medinipur in West Bengal by the said subsidiary and the plans for commencing construction of the said complex.
(c) Equity shares of JSW Jharkhand Steel Limited, a subsidiary (carrying amount: ` 88 crores as at March 31, 2019; ` 84 crores as at
March 31, 2018) - Evaluation of the status of its integrated Steel Complex to be implemented in phases at Ranchi, Jharkhand by the
said subsidiary and the plans for commencing construction of the said complex.
(d) Equity shares of Peddar Realty Private Limited (PRPL) (carrying amount of investments: ` 24 crores as at March 31, 2019; ` 24
crores as at March 31, 2018, and loans of ` 155 crores as at March 31, 2019; ` 155 crores as at March 31, 2018) -Valuation by an
independent valuer of the residential complex in which PRPL holds interest.
(e) Investment of ` 4 crores (` 4 crores as at March 31, 2018) and loan of ` 147 crores (` 137 crores as at March 31, 2018) relating to
JSW Natural Resources Mozambique Limitada and JSW ADMS Carvo Limitada (step down subsidiaries) - Assessment of minable
reserves by independent experts based on the plans to commence operations after mining lease arrangements are in place for
which application has been submitted to regulatory authorities, and infrastructure is developed.
(f) Equity shares of JSW Severfield Structures Limited, a joint venture (carrying amount: ` 198 crores as at March 31, 2019; ` 160 crores
as at March 31, 2018) - Cash flow projections approved by the said JV which are based on estimates and assumptions relating to
order book, capacity utilisation, operational performance, market prices of materials, inflation, terminal value, etc.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
51. a. On 15 June 2018, the Company completed acquisition of 100% equity stake in Acero Junction Holdings, Inc (Acero) for a cash
consideration of ` 536 crores (USD 80.85 million). Acero, along with its wholly owned subsidiary JSW Steel USA Ohio, Inc
(Formerly known as Acero Junction, Inc.).
b. Pursuant to the Corporate Insolvency Resolution process for Monnet Ispat & Energy Limited (“MIEL”) under the Insolvency
Bankruptcy Code, 2016 initiated on 18 July 2017, the National Company Law Tribunal (‘NCLT’) on 24 July 2018 (Order date)
approved (with modifications) the resolution plan submitted by the consortium of JSW Steel Limited and AION Investments
Private II Limited. The consortium completed the acquisition of MIEL through their jointly controlled entity Creixent Special
Steels Limited (“CSSL”) on 31 August 2018. The Company has made an investment of ` 375 crores through equity and
redeemable preference shares in CSSL to acquire joint control in MIEL and have an effective shareholding of 23.1% in MIEL.
c. The Resolution Plan submitted by the Company for Vardhman Industries Limited (VIL) was approved with some modifications,
by the Hon’ble National Company Law Tribunal (NCLT) New Delhi, by its order dated April 16, 2019. The Company filed an appeal
challenging the said NCLT Order before National Company Law Appellate Tribunal (NCLAT), in which an interim order was
passed on April 30, 2019 suggesting that the Resolution Plan as approved by the Committee of Creditors may be implemented
subject to the decision of the appeal. The Company further filed an Appeal before the Hon’ble Supreme Court against the
interim order of NCLAT in which the Hon’ble Supreme Court vide an order dated May 10, 2019 has ordered status quo and the
matter is posted for hearing before the NCLAT on May 28, 2019.
d. On 24 July 2018, the Company through its wholly owned subsidiary in Italy, JSW Steel Italy S.r.l, completed acquisition of 100%
shares each of Aferpi S.p.A and Piombino Logistics S.p.A and 69.27% of the shares of GSI Lucchini S.p.A (collectively referred
to as “Targets”) for a consideration of ` 489 crores (Euro 60.70 million) towards acquisition of equity shares and ` 100 crores
(Euro 12.38 million) towards acquisition of loans provided by erstwhile shareholders of the targets.
e. On 23 October 2018, the Company has acquired an additional stake of 60.004% of the share capital of Dolvi Minerals and
Metals Private Limited (“DMMPL”), a subsidiary, for a cash consideration of `109 crores. Pursuant to the acquisition of shares
of DMMPL, DMMPL along with its wholly owned subsidiary Dolvi Coke Projects Limited (“DCPL”), have become wholly owned
subsidiaries of the Company.
52. The Board of Directors of the Company at their meeting held on 25 October 2018, considered and approved the Scheme of
Amalgamation pursuant to sections 230 - 232 and other applicable provisions of the Companies Act, 2013, providing for the merger
of its wholly owned subsidiaries, Dolvi Minerals and Metals Private Limited, Dolvi Coke Projects Limited, JSW Steel Processing
Centre Limited, and JSW Steel (Salav) Limited with the Company. The said scheme has been filed with NCLT and the merger is
subject to regulatory approvals.
53. Previous year figures have been re-grouped /re-classified wherever necessary.
b) On 24 May 2019 the board of directors recommended a final dividend of ` 4.10 per equity share be paid to shareholders for
financial year 2018-19, which is subject to approval by the shareholders at the Annual General Meeting to be held on 25
July 2019. If approved, the dividend would result in a cash outflow of ` 1,195 crores inclusive of dividend distribution tax
of ` 204 crores.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease
term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee
will generally recognise the amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset.
Lessor accounting under Ind AS 116 is substantially unchanged from today’s accounting under Ind AS 17. Lessors will continue to
classify all leases using the same classification principle as in Ind AS 17 and distinguish between two types of leases: operating
and finance leases.
The Company is in the process of evaluating the effect of these amendments on the financial statements.
According to the amendments, these types of instruments can be classified as measured at amortised cost, or measured at
fair value through profit or loss, or measured at fair value through other comprehensive income by the lender or issuer if the
respective conditions specified under Ind AS 109 are satisfied.
The second amendment relates to tax consequence of an item whose tax treatment is uncertain. Tax treatment of an item is
considered as uncertain when there is uncertainty whether the relevant taxation authority will accept the tax treatment of
that item or not.
If there is uncertainty over tax treatment of an item an entity should predict the resolution of the uncertainty. If it is probable
that the taxation authority will accept the tax treatment, there will be no impact on the amount of taxable profits/losses, tax
bases, unused tax losses/credits and tax rates. In vice-versa case, the entity shall show the effect of the uncertainty for each
uncertain tax treatment on amount of related items by using either the most likely outcome or the expected outcome of the
uncertainty.
NOTES
TO THE STANDALONE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED 31 MARCH 2019
To the Members of JSW Steel Limited Institute of Chartered Accountants of India together with the
ethical requirements that are relevant to our audit of the financial
Report on the Audit of the Consolidated Ind AS Financial
statements under the provisions of the Act and the Rules
Statements
thereunder, and we have fulfilled our other ethical responsibilities
Opinion in accordance with these requirements and the Code of Ethics.
We believe that the audit evidence we have obtained is sufficient
We have audited the accompanying consolidated Ind AS financial
and appropriate to provide a basis for our audit opinion on the
statements of JSW Steel Limited (hereinafter referred to as “the
consolidated Ind AS financial statements.
Holding Company”), its subsidiaries (the Holding Company and its
subsidiaries together referred to as “the Group”) its joint ventures, Key Audit Matters
comprising of the consolidated Balance sheet as at March 31 2019,
Key audit matters are those matters that, in our professional
the consolidated Statement of Profit and Loss, including other
judgment, were of most significance in our audit of the consolidated
comprehensive income, the consolidated Cash Flow Statement
Ind AS financial statements for the financial year ended March 31,
and the consolidated Statement of Changes in Equity for the
2019. These matters were addressed in the context of our audit
year then ended, and notes to the consolidated Ind AS financial
of the consolidated Ind AS financial statements as a whole, and
statements, including a summary of significant accounting
in forming our opinion thereon, and we do not provide a separate
policies and other explanatory information (hereinafter referred to
opinion on these matters. For each matter below, our description
as “the consolidated Ind AS financial statements”).
of how our audit addressed the matter is provided in that context.
In our opinion and to the best of our information and according
We have determined the matters described below to be the key
to the explanations given to us and based on the consideration
audit matters to be communicated in our report. We have fulfilled
of reports of other auditors on separate financial statements and
the responsibilities described in the Auditor’s responsibilities for
on the other financial information of the subsidiaries and joint
the audit of the consolidated Ind AS financial statements section
ventures, the aforesaid consolidated Ind AS financial statements
of our report, including in relation to these matters. Accordingly,
give the information required by the Companies Act, 2013, as
our audit included the performance of procedures designed to
amended (“the Act”) in the manner so required and give a true and
respond to our assessment of the risks of material misstatement
fair view in conformity with the accounting principles generally
of the consolidated Ind AS financial statements. The results
accepted in India, of the consolidated state of affairs of the Group
of audit procedures performed by us and by other auditors of
and its joint ventures as at March 31, 2019, their consolidated
components not audited by us, as reported by them in their audit
profit including other comprehensive income, their consolidated
reports furnished to us by the management, including those
cash flows and the consolidated statement of changes in equity
procedures performed to address the matters below, provide the
for the year ended on that date.
basis for our audit opinion on the accompanying consolidated Ind
Basis for Opinion AS financial statements.
Key audit matters How our audit addressed the key audit matter
Recoverability of Goodwill, Property plant and Equipment (PPE), Capital work in progress (CWIP), Leasehold land and Advances
related to certain business (as described in note 49 of the consolidated Ind AS financial statements)
As at March 31, 2019, the Group has carrying amount of : Our audit procedures included the following:
• Goodwill of ` 746 crores, • We have obtained and read management’s assessment for
impairment.
• Property plant and Equipment, capital work in
progress, advances and license fees of ` 5,009 • We performed test of controls over impairment process through
inspection of evidence of performance of these controls.
• Inventories ` 121 crores
• Assessed the impairment model prepared by the management and
• Lease hold land `74 crores
the assumptions used, with particular attention to the following:
related to certain businesses incurring losses or
- Benchmarking or assessing key market related assumptions
where projects are under implementation.
used in the impairment models, including discount rates, long
Assessment of the recoverable amount of Goodwill, term growth rate, risk free rate of return, weight average cost of
Property plant and Equipment (PPE), capital work in capital, production schedule against external data.
progress, Capital work in progress (CWIP), Leasehold land,
- assessing the cash flow forecasts through analysis of actual
Inventories and Advances related to certain businesses
past performance and comparison to previous forecasts;
has been identified as a key audit matter due to:
- testing the mathematical accuracy and performing sensitivity
• Significance of the carrying amount of these
analyses of the models;
balances.
- understanding the commercial prospects of the assets/
• The assessment requires management to make
projects, and comparison of assumptions with external data
significant estimates concerning the estimated
sources;
future cash flows, qualitative assessments of the
status of the project and its future depending on • We assessed the competence, capabilities and objectivity of the
balance work to be performed or approvals to be experts used by the Group in the process of determining recoverable
received, associated discount rates and growth rates amounts.
based on management’s view of future business
• We assessed the compliance of the disclosures made in note 49 of
prospects.
the consolidated Ind AS financial statements with the accounting
• Changes to any of these assumptions could lead standards.
to material changes in the estimated recoverable
amount, impacting both potential impairment
charges and also potential reversals of impairment
taken in prior years.
Key audit matters How our audit addressed the key audit matter
Recoverability of VAT deferral / refunds under the GST regime (as described in note 30 of the consolidated Ind AS financial statements)
The Group’s units at Dolvi in Maharashtra and Vijayanagar Our audit procedures included the following:
in Karnataka are eligible and have been availing for interest
• We obtained an understanding, evaluated the design and tested
free VAT deferral loan / refunds as an incentive under the
operating effectiveness of the controls related to the recognition of
incentive schemes notified by the State of Maharashtra
government grants and income accruing therefrom, including the
and Karnataka.
controls in respect of measurement of the grants.
The Group has recognised income in relation these grants
• We have read eligibility certificates in respect of VAT deferral / refund
being the difference between the net present value of
incentives available to Company.
these interest free loans granted to the Company and
the nominal value of such loans to the extent of SGST • We have read the notification issued by the Government of
collected by the Group in respect of sales eligible for such Maharashtra and Government of Karnataka stating eligibility of VAT
grants, in accordance with notifications issued by the deferral / refunds under the GST regime.
State of Maharashtra and Karnataka.
• We have read Government Resolution dated 20 December 2018
The State Government of Maharashtra (‘GoM’) vide its and revision made on 8 March 2019, issued by Government of
Government Resolution dated 20 December 2018, revised Maharashtra in respect of modalities for sanction and disbursement
on 8 March 2019, has issued the modalities for sanction of Incentives under GST regime.
and disbursement of Incentives under GST regime,
• We have read circular dated 26 February 2019 issued by the State
which includes certain additional conditions for eligibility
Government of Karnataka in respect of guidelines for certification of
and prescribed a new formula for determination of the
the eligible incentive amount.
incentives.
• Read the legal opinion obtained by the management for assessing
The State Government of Karnataka vide its circular dated
the impact of new eligibility conditions and formula for determination
26 February 2019, has issued guidelines for certification
incentives based on latest Government Resolution issued by GoM
of the eligible incentive amount.
• We involved specialists to assist us in reviewing and evaluating the
The amount of incentive recognized during the year
management’s assessment of latest Government Resolution issued
amounts to ` 1,174 crores and cumulative balance of
by GoM.
these receivables amount to ` 2,047 crores.
We have tested the calculation of incentives accrued for the year
We considered VAT deferral / refund incentive as a Key
ended March 31, 2019.
audit matter due to:
• Significance of amount accrued during the year and
carrying amount of these receivables as at March 31,
2019
Key audit matters How our audit addressed the key audit matter
Accounting for Acquisitions (as described in note 39 and Note 3(B) of the consolidated Ind AS financial statements)
During the financial year ended 31 March 2019, the Group Our audit procedures included the following:
has completed following acquisitions:
• We have, amongst others, read the Shareholders agreements, the
I. Acero Junction Holdings Inc (or “Acero”) along with its Resolution plan approved by the National Company Law Tribunal
wholly owned subsidiary on 15 June 2018. The Group and other related documents to obtain an understanding of the
has acquired 100% equity stake in the Acero. transactions and the key terms and conditions.
II. Monnet Ispat and Energy Limited (or “MIEL”) through • Evaluating the control assessment made by the management and
its jointly controlled entity Creixent Special Steels assessing whether the appropriate accounting treatment has been
Limited on 31 August 2018, in accordance with the applied to these transactions.
resolution plan approved by the National Company
• Read the valuation reports for the purchase price considerations paid
Law Tribunal for consortium of JSW Steel Limited and
for these acquisitions. We tested the identification and fair valuation
AION Investments Private II Limited.
of the acquired assets including: intangible assets acquired and
III. Aferpi S.p.A, Piombino Logistics S.p.A and GSI Lucchini liabilities by corroborating this identification based on our discussion
S.p.A (“Aferpi”) through its wholly owned subsidiary in with management and understanding of the business.
Italy, JSW Steel Italy S.r.l on 24 July 2018.
• Understanding valuation methodologies used by management and
We considered the audit of accounting for these the external valuation experts in the fair valuation of acquired assets
acquisitions to be a key audit matter as these are and liabilities.
significant transactions during the year which require
• We assessed the valuation assumptions such as discount and
significant management judgement regarding:
long term growth rates risk free rate of return and weight average
• Assessment of control or joint control over the cost of capital by comparing these assumptions to source data and
entities acquired. external data.
• Allocation of the purchase price to the assets and • Understanding the commercial prospects of the assets /projects
liabilities acquired and adjustments made to align acquired.
accounting policies of the newly acquired entities
• We have also assessed the competence, capabilities and relevant
with the Group.
experience of the experts engaged by management to determine
• fair valuation of the assets and liabilities acquired fair valuation of the assets and liabilities acquired.
and to identify intangible assets acquired in the
• We also assessed the compliance of the disclosures made in
acquisition.
the consolidated Ind AS financial statements with the relevant
• Accounting and disclosures given in the financial accounting standards with respect to the assessment of control
statements in accordance with the applicable Ind AS. over MIEL in Note 3(B) and in respect to the acquisition of Acero and
Aferpi in Note 39 (a) and (b).
Key audit matters How our audit addressed the key audit matter
Accuracy and completeness of disclosure of related party transactions and compliance with the provisions of Companies Act 2013
and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (‘SEBI (LODR) 2015’) (as described
in note 43 of the consolidated Ind AS financial statements)
We identified the accuracy and completeness of Our procedures in relation to the disclosure of related party transactions
disclosure of related party transactions as set out in included:
respective notes to the consolidated Ind AS financial
• Obtaining an understanding of the Group’s policies and procedures
statements as a key audit matter due to :
in respect of the capturing of related party transactions and how
• the significance of transactions with related parties management ensures all transactions and balances with related
during the year ended March 31, 2019. parties have been disclosed in the consolidated Ind AS financial
statements.
• Related party transactions are subject to the
compliance requirement under the Companies Act • Obtaining an understanding of the Group’s policies and procedures
2013 and SEBI (LODR) 2015. in respect of evaluating arms-length pricing and approval process
by the audit committee and the board of directors.
Information Other than the Financial Statements and Auditor’s its associates and joint ventures are responsible for assessing
Report Thereon the ability of the Group and of its associates and joint ventures
to continue as a going concern, disclosing, as applicable, matters
The Holding Company’s Board of Directors is responsible for
related to going concern and using the going concern basis of
the other information. The other information comprises the
accounting unless management either intends to liquidate the
information included in the Annual report, but does not include the
Group or to cease operations, or has no realistic alternative but
consolidated Ind AS financial statements and our auditor’s report
to do so.
thereon.
Those respective Board of Directors of the companies included
Our opinion on the consolidated Ind AS financial statements does
in the Group and of its associates and joint ventures are also
not cover the other information and we do not express any form of
responsible for overseeing the financial reporting process of the
assurance conclusion thereon.
Group and of its associates and joint ventures.
In connection with our audit of the consolidated Ind AS financial
Auditor’s Responsibilities for the Audit of the Consolidated Ind
statements, our responsibility is to read the other information and,
AS Financial Statements
in doing so, consider whether such other information is materially
inconsistent with the consolidated financial statements or our Our objectives are to obtain reasonable assurance about whether
knowledge obtained in the audit or otherwise appears to be the consolidated Ind AS financial statements as a whole are free
materially misstated. If, based on the work we have performed, from material misstatement, whether due to fraud or error, and to
we conclude that there is a material misstatement of this other issue an auditor’s report that includes our opinion. Reasonable
information, we are required to report that fact. We have nothing assurance is a high level of assurance, but is not a guarantee that
to report in this regard. an audit conducted in accordance with SAs will always detect a
material misstatement when it exists. Misstatements can arise
Responsibilities of Management for the Consolidated Ind AS
from fraud or error and are considered material if, individually or
Financial Statements
in the aggregate, they could reasonably be expected to influence
The Holding Company’s Board of Directors is responsible for the the economic decisions of users taken on the basis of these
preparation and presentation of these consolidated Ind AS financial consolidated Ind AS financial statements.
statements in terms of the requirements of the Act that give a true
As part of an audit in accordance with SAs, we exercise
and fair view of the consolidated financial position, consolidated
professional judgment and maintain professional skepticism
financial performance including other comprehensive income,
throughout the audit. We also:
consolidated cash flows and consolidated statement of changes
in equity of the Group including its associates and joint ventures • Identify and assess the risks of material misstatement
in accordance with the accounting principles generally accepted of the consolidated Ind AS financial statements, whether
in India, including the Indian Accounting Standards (Ind AS) due to fraud or error, design and perform audit procedures
specified under section 133 of the Act read with the Companies responsive to those risks, and obtain audit evidence that is
(Indian Accounting Standards) Rules, 2015, as amended. The sufficient and appropriate to provide a basis for our opinion.
respective Board of Directors of the companies included in the The risk of not detecting a material misstatement resulting
Group and of its associates and joint ventures are responsible from fraud is higher than for one resulting from error, as
for maintenance of adequate accounting records in accordance fraud may involve collusion, forgery, intentional omissions,
with the provisions of the Act for safeguarding of the assets of the misrepresentations, or the override of internal control.
Group and of its associates and joint ventures and for preventing
• Obtain an understanding of internal control relevant to the
and detecting frauds and other irregularities; selection and
audit in order to design audit procedures that are appropriate
application of appropriate accounting policies; making judgments
in the circumstances. Under section 143(3)(i) of the Act, we
and estimates that are reasonable and prudent; and the design,
are also responsible for expressing our opinion on whether
implementation and maintenance of adequate internal financial
the Holding Company has adequate internal financial controls
controls, that were operating effectively for ensuring the accuracy
system in place and the operating effectiveness of such
and completeness of the accounting records, relevant to the
controls.
preparation and presentation of the consolidated Ind AS financial
statements that give a true and fair view and are free from • Evaluate the appropriateness of accounting policies used
material misstatement, whether due to fraud or error, which have and the reasonableness of accounting estimates and related
been used for the purpose of preparation of the consolidated Ind disclosures made by management.
AS financial statements by the Directors of the Holding Company,
• Conclude on the appropriateness of management’s use of the
as aforesaid.
going concern basis of accounting and, based on the audit
In preparing the consolidated financial statements, the respective
Board of Directors of the companies included in the Group and of
evidence obtained, whether a material uncertainty exists precludes public disclosure about the matter or when, in
related to events or conditions that may cast significant extremely rare circumstances, we determine that a matter
doubt on the ability of the Group and its associates and joint should not be communicated in our report because the
ventures to continue as a going concern. If we conclude adverse consequences of doing so would reasonably be
that a material uncertainty exists, we are required to draw expected to outweigh the public interest benefits of such
attention in our auditor’s report to the related disclosures communication.
in the consolidated Ind AS financial statements or, if such
Other Matter
disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up (a) We did not audit the financial statements and other financial
to the date of our auditor’s report. However, future events or information, in respect of 28 subsidiaries, whose Ind AS
conditions may cause the Group and its associates and joint financial statements include total assets of Rs 12,810 crores
ventures to cease to continue as a going concern. as at March 31, 2019, and total revenues of Rs 8,313 crores
and net cash inflows of Rs 136 crores for the year ended
• Evaluate the overall presentation, structure and content of
on that date. These Ind AS financial statement and other
the consolidated Ind AS financial statements, including the
financial information have been audited by other auditors,
disclosures, and whether the consolidated Ind AS financial
which financial statements, other financial information
statements represent the underlying transactions and
and auditor’s reports have been furnished to us by the
events in a manner that achieves fair presentation.
management. The consolidated Ind AS financial statements
• Obtain sufficient appropriate audit evidence regarding the also include the Group’s share of net loss of ` 30 crores
financial information of the entities or business activities for the year ended March 31, 2019, as considered in the
within the Group and its associates and joint ventures of consolidated Ind AS financial statements, in respect of 8
which we are the independent auditors, to express an opinion joint ventures, whose financial statements, other financial
on the consolidated Ind AS financial statements. We are information have been audited by other auditors and whose
responsible for the direction, supervision and performance of reports have been furnished to us by the Management. Our
the audit of the financial statements of such entities included opinion on the consolidated Ind AS financial statements, in
in the consolidated financial statements of which we are the so far as it relates to the amounts and disclosures included
independent auditors. For the other entities included in the in respect of these subsidiaries and joint ventures, and our
consolidated financial statements, which have been audited report in terms of sub-sections (3) of Section 143 of the
by other auditors, such other auditors remain responsible Act, in so far as it relates to the aforesaid subsidiaries and
for the direction, supervision and performance of the audits joint ventures, is based solely on the reports of such other
carried out by them. We remain solely responsible for our auditors.
audit opinion.
Certain subsidiaries and joint ventures are located outside
We communicate with those charged with governance of India whose financial statements and other financial
the Holding Company and such other entities included in the information have been prepared in accordance with
consolidated Ind AS financial statements of which we are the accounting principles generally accepted in their respective
independent auditors regarding, among other matters, the countries and which have been audited by other auditors
planned scope and timing of the audit and significant audit under generally accepted auditing standards applicable in
findings, including any significant deficiencies in internal control their respective countries. The Company’s management has
that we identify during our audit. converted the financial statements of such subsidiaries
and joint ventures located outside India from accounting
We also provide those charged with governance with a
principles generally accepted in their respective countries
statement that we have complied with relevant ethical
to accounting principles generally accepted in India. We
requirements regarding independence, and to communicate
have audited these conversion adjustments made by the
with them all relationships and other matters that may
Company’s management. Our opinion in so far as it relates
reasonably be thought to bear on our independence, and
to the balances and affairs of such subsidiaries and joint
where applicable, related safeguards.
ventures located outside India is based on the report of other
From the matters communicated with those charged with auditors and the conversion adjustments prepared by the
governance, we determine those matters that were of management of the Company and audited by us.
most significance in the audit of the consolidated Ind AS
(b) The accompanying consolidated Ind AS financial statements
financial statements for the financial year ended March 31,
include unaudited financial statements and other unaudited
2019 and are therefore the key audit matters. We describe
financial information in respect of 1 subsidiary, whose
these matters in our auditor’s report unless law or regulation
financial statements and other financial information reflect (b) In our opinion, proper books of account as required by law
nil total assets as at March 31, 2019, and nil total revenues relating to preparation of the aforesaid consolidation of the
and nil net cash outflows for the year ended on that date. financial statements have been kept so far as it appears
These unaudited financial statements and other unaudited from our examination of those books and reports of the other
financial information have been furnished to us by the auditors;
management. The consolidated Ind AS financial statements
(c) The Consolidated Balance Sheet, the Consolidated
also include the Group’s share of net loss of ` 0.07 crores
Statement of Profit and Loss including the Statement of
for the year ended March 31, 2019, as considered in the
Other Comprehensive Income, the Consolidated Cash Flow
consolidated Ind AS financial statements, in respect of 2
Statement and Consolidated Statement of Changes in Equity
joint ventures, whose financial statements, other financial
dealt with by this Report are in agreement with the books
information have not been audited and whose unaudited
of account maintained for the purpose of preparation of the
financial statements, other unaudited financial information
consolidated Ind AS financial statements;
have been furnished to us by the Management. Our opinion,
in so far as it relates amounts and disclosures included in (d) In our opinion, the aforesaid consolidated Ind AS financial
respect of these subsidiaries and joint ventures, and our statements comply with the Accounting Standards specified
report in terms of sub-sections (3) of Section 143 of the under Section 133 of the Act, read with Companies (Indian
Act in so far as it relates to the aforesaid subsidiaries and Accounting Standards) Rules, 2015, as amended;
joint ventures, is based solely on such unaudited financial
(e) On the basis of the written representations received from
statement and other unaudited financial information. In our
the directors of the Holding Company as on March 31, 2019
opinion and according to the information and explanations
taken on record by the Board of Directors of the Holding
given to us by the Management, these financial statements
Company and the reports of the statutory auditors who are
and other financial information are not material to the Group.
appointed under Section 139 of the Act, of its subsidiary
Our opinion above on the consolidated Ind AS financial companies and joint ventures, none of the directors of the
statements, and our report on Other Legal and Regulatory Group’s companies, its joint ventures incorporated in India is
Requirements below, is not modified in respect of the above disqualified as on March 31, 2019 from being appointed as a
matters with respect to our reliance on the work done and director in terms of Section 164 (2) of the Act;
the reports of the other auditors and the financial statements
(f) With respect to the adequacy and the operating effectiveness
and other financial information certified by the Management.
of the internal financial controls over financial reporting with
Report on Other Legal and Regulatory Requirements reference to these consolidated Ind AS financial statements
of the Holding Company and its subsidiary companies, and
As required by Section 143(3) of the Act, based on our audit and
joint ventures incorporated in India, refer to our separate
on the consideration of report of the other auditors on separate
Report in “Annexure 2” to this report;
financial statements and the other financial information of
subsidiaries and joint ventures, as noted in the ‘other matter’ (g) In our opinion and based on the consideration of reports
paragraph we report, to the extent applicable, that: of other statutory auditors of the subsidiaries and joint
ventures incorporated in India, the managerial remuneration
(a) We/the other auditors whose report we have relied upon have
for the year ended March 31, 2019 has been paid / provided
sought and obtained all the information and explanations
by the Holding Company, its subsidiaries and joint ventures
which to the best of our knowledge and belief were necessary
incorporated in India to their directors in accordance with the
for the purposes of our audit of the aforesaid consolidated
provisions of section 197 read with Schedule V to the Act;
Ind AS financial statements;
(h) With respect to the other matters to be included in the ii. The Group and its joint ventures did not have any material
Auditor’s Report in accordance with Rule 11 of the Companies foreseeable losses in long-term contracts including
(Audit and Auditors) Rules, 2014, as amended, in our opinion derivative contracts during the year ended March 31,
and to the best of our information and according to the 2019;
explanations given to us and based on the consideration
iii. There has been no delay in transferring amounts,
of the report of the other auditors on separate financial
required to be transferred, to the Investor Education and
statements as also the other financial information of the
Protection Fund by the Holding Company, its subsidiaries
subsidiaries and joint ventures, as noted in the ‘Other matter’
and joint ventures incorporated in India during the year
paragraph:
ended March 31, 2019.
i. The consolidated Ind AS financial statements disclose
For S R B C & CO LLP
the impact of pending litigations on its consolidated
Chartered Accountants
financial position of the Group and its joint ventures in
ICAI Firm Registration Number: 324982E/E300003
its consolidated Ind AS financial statements – Refer Note
44 to the consolidated Ind AS financial statements;
per VIKRAM MEHTA
Partner
Membership Number: 105938
Annexure 1
Annexure 1 to the Independent Auditor’s Report of even date on Our audit involves performing procedures to obtain audit evidence
the consolidated Ind AS financial statements of JSW Steel Limited about the adequacy of the internal financial controls over financial
reporting with reference to these consolidated Ind AS financial
Report on the Internal Financial Controls under Clause (i) of Sub-
statements and their operating effectiveness. Our audit of internal
section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
financial controls over financial reporting included obtaining an
In conjunction with our audit of the consolidated Ind AS financial understanding of internal financial controls over financial reporting
statements of JSW Steel Limited as of and for the year ended with reference to these consolidated Ind AS financial statements,
March 31, 2019, we have audited the internal financial controls assessing the risk that a material weakness exists, and testing
over financial reporting of JSW Steel Limited (hereinafter referred and evaluating the design and operating effectiveness of internal
to as the “Holding Company”) and its subsidiary companies and control based on the assessed risk. The procedures selected
joint ventures, which are companies incorporated in India, as of depend on the auditor’s judgement, including the assessment of
that date. the risks of material misstatement of the financial statements,
whether due to fraud or error.
Management’s Responsibility for Internal Financial Controls
We believe that the audit evidence we have obtained and the audit
The respective Board of Directors of the Holding Company, its
evidence obtained by the other auditors in terms of their reports
subsidiary companies and joint ventures, which are companies
referred to in the Other Matters paragraph below, is sufficient and
incorporated in India, are responsible for establishing and
appropriate to provide a basis for our audit opinion on the internal
maintaining internal financial controls based on the internal
financial controls over financial reporting with reference to these
control over financial reporting criteria established by the Holding
consolidated Ind AS financial statements.
Company considering the essential components of internal control
stated in the Guidance Note on Audit of Internal Financial Controls Meaning of Internal Financial Controls Over Financial Reporting
Over Financial Reporting issued by the Institute of Chartered With Reference to these consolidated Ind AS financial
Accountants of India. These responsibilities include the design, statements
implementation and maintenance of adequate internal financial
A company’s internal financial control over financial reporting with
controls that were operating effectively for ensuring the orderly
reference to these consolidated Ind AS financial statements is
and efficient conduct of its business, including adherence to the
a process designed to provide reasonable assurance regarding
respective company’s policies, the safeguarding of its assets,
the reliability of financial reporting and the preparation of
the prevention and detection of frauds and errors, the accuracy
financial statements for external purposes in accordance with
and completeness of the accounting records, and the timely
generally accepted accounting principles. A company’s internal
preparation of reliable financial information, as required under the
financial control over financial reporting with reference to
Act.
these consolidated Ind AS financial statements includes those
Auditor’s Responsibility policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect
Our responsibility is to express an opinion on the company’s
the transactions and dispositions of the assets of the Company;
internal financial controls over financial reporting with reference
(2) provide reasonable assurance that transactions are recorded
to these consolidated Ind AS financial statements based on our
as necessary to permit preparation of financial statements in
audit. We conducted our audit in accordance with the Guidance
accordance with generally accepted accounting principles, and
Note on Audit of Internal Financial Controls Over Financial
that receipts and expenditures of the Company are being made
Reporting (the “Guidance Note”) and the Standards on Auditing,
only in accordance with authorisations of management and
both, issued by Institute of Chartered Accountants of India, and
directors of the Company; and (3) provide reasonable assurance
deemed to be prescribed under section 143 (10) of the Act, to
regarding prevention or timely detection of unauthorised
the extent applicable to an audit of internal financial controls.
acquisition, use, or disposition of the Company’s assets that could
Those Standards and the Guidance Note require that we comply
have a material effect on the financial statements.
with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether adequate internal Inherent Limitations of Internal Financial Controls Over Financial
financial controls over financial reporting with reference to these Reporting With Reference to these consolidated Ind AS financial
consolidated Ind AS financial statements was established and statements
maintained and if such controls operated effectively in all material
Because of the inherent limitations of internal financial controls
respects.
over financial reporting with reference to these consolidated
Ind AS financial statements, including the possibility of
collusion or improper management override of controls, material
misstatements due to error or fraud may occur and not be detected. Over Financial Reporting issued by the Institute of Chartered
Also, projections of any evaluation of the internal financial controls Accountants of India.
over financial reporting with reference to these consolidated Ind
Other Matters
AS financial statements to future periods are subject to the risk
that the internal financial control over financial reporting with Our report under Section 143(3)(i) of the Act on the adequacy and
reference to these consolidated Ind AS financial statements may operating effectiveness of the internal financial controls over
become inadequate because of changes in conditions, or that financial reporting with reference to these consolidated Ind AS
the degree of compliance with the policies or procedures may financial statements of the Holding Company, insofar as it relates
deteriorate. to these 16 subsidiary companies and 9 joint ventures, which are
companies incorporated in India, is based on the corresponding
Opinion
reports of the auditors of such subsidiary and joint ventures
In our opinion, the Holding Company, its subsidiary companies incorporated in India.
and joint ventures, which are companies incorporated in India,
For S R B C & CO LLP
have, maintained in all material respects, adequate internal
Chartered Accountants
financial controls over financial reporting with reference to these
ICAI Firm Registration Number: 324982E/E300003
consolidated Ind AS financial statements and such internal
financial controls over financial reporting with reference to
per VIKRAM MEHTA
these consolidated Ind AS financial statements were operating
Partner
effectively as at March 31, 2019, based on the internal control over
Membership Number: 105938
financial reporting criteria established by the Holding Company
considering the essential components of internal control stated Place of Signature: Mumbai
in the Guidance Note on Audit of Internal Financial Controls Date: May 24, 2019
B. Other equity
` in crores
Reserves and surplus Other comprehensive income / (loss)
Equity settled Capital Equity instruments Effective Attributable Non-
Securities Capital Debenture to owners of controlling Total
Capital Retained share based General reserve on through other portion of
premium redemption redemption FCTR FCMITDA the parent interest
reserve earnings payment reserve bargain comprehensive cash flow
reserve reserve reserve
reserve purchase income hedges
` in crores
For the year ended For the year ended
31 March 2019 31 March 2018
A. Cash flow from operating activities
Net profit before tax 11,168 7,651
Adjustments for:
Depreciation and amortization expense 4,041 3,387
Loss on sale of property, plant and equipment 8 122
Gain on sale of current investments designated as FVTPL (19) (19)
Export obligation deferred income amortization (165) (68)
Fair value gain on deferral sales tax / VAT Loan - (53)
Interest income (134) (120)
Dividend income - (5)
Interest expense 3,582 3,500
Unrealised exchange gains / (loss) 155 31
Fair value gain on financial instruments designated as FVTPL (6) (2)
Unwinding of interest on financial assets carried at amortised cost (25) (1)
Share based payment expense 50 28
Share of loss / (profit) from joint ventures (net) 30 (42)
Fair value loss on financial instrument designated as FVTPL 1 111
Allowances for doubtful receivable and advances 152 136
Impairment of property plant and equipment, goodwill and investments - 264
Donation of land 6 -
7,676 7,269
Operating profit before working capital changes 18,844 14,920
Adjustments for:
Increase in inventories (1,741) (1,199)
Increase in trade receivables (2,203) (640)
Increase in other assets (1,084) (1,793)
Increase in trade payable and other liabilities 3,406 2,514
Increase in provisions 41 17
(1,581) (1,101)
Cash flow from operations 17,263 13,819
Income taxes paid (net of refund received) (2,630) (1,440)
Net cash generated from operating activities 14,633 12,379
B. Cash flow from investing activities
Payments for property, plant and equipment and intangibles (including (10,206) (4,736)
capital advances)
Proceeds from sale of property, plant and equipment 44 60
Net cash outflow for acquisition of a subsidiary / acquisition of NCI (1,014) (315)
Investment in joint ventures (413) (46)
Purchase of current investments (8,340) (8,111)
Sale of current investments 8,591 8,120
Bank deposits not considered as cash and cash equivalents (net) (268) 373
Interest received 158 121
Dividend received - 5
Net cash used in investing activities (11,448) (4,529)
C. Cash flow from financing activities
Proceeds from sale of treasury shares - 49
Payment for purchase of treasury shares (153) (76)
Proceeds from non-current borrowings 8,999 6,209
Repayment of non-current borrowings (6,273) (7,298)
Proceeds from / repayment of current borrowings (net) 4,155 (2,703)
Repayment of finance lease obligations (227) (200)
Interest paid (3,815) (3,511)
` in crores
For the year ended For the year ended
31 March 2019 31 March 2018
Dividend paid (including corporate dividend tax) (933) (655)
Net cash generated from / (used in) financing activities 1,753 (8,185)
Net increase / (decrease) in cash and cash equivalents(A+B+C) 4,938 (335)
Cash and cash equivalents at the beginning of year 582 917
Add: Translation adjustment in cash and cash equivalents 3 @
Add: Cash and cash equivalents pursuant to business combinations 58 -
(refer note 39)
Cash and cash equivalents at the end of year 5,581 582
@ - Less than ` 0.50 crores
Foreign
Cash flows Changes in 31 March
Particulars 1 April 2018 exchange New leases Others
(net) fair values 2019
difference
Borrowings (non-current) 35,435 2,726 926 32 - (13) 39,106
other than finance lease obligations
(including current maturities of long term
borrowing included in other financial
liabilities note 28)
Finance lease obligations (including 1,781 (227) - - 403 - 1,957
current maturities of finance
lease obligations)
Borrowings (current) 2,177 4,155 1 - - - 6,333
` in crores
Foreign
Cash flows Changes in
Particulars 1 April 2017 exchange New leases Other 31 March 2018
(net) fair values
difference
Borrowings (non-current) 36,472 (1,089) 93 (52) - 11 35,435
other than finance lease obligations
(including current maturities of long term
borrowing included in other financial
liabilities note 28)
Finance lease obligations (including 1,981 (200) - - - - 1,781
current maturities of finance
lease obligations)
Borrowings (current) 4,881 (2,703) (1) - - - 2,177
Other comprises of upfront fees amortization and interest cost accrual on preference shares.
Notes:
1. The cash flow statement is prepared using the “indirect method” set out in Ind AS 7 - Statement of Cash Flows.
2. The group has acquired property, plant and equipment of ` 403 crores (previous year ` Nil crores) on finance lease.
See accompanying notes to the Consolidated Financial Statements
As per our report of even date For and on behalf of Board of Directors
For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
RAJEEV PAI SAJJAN JINDAL
Chief Financial Officer Chairman & Managing Director
per VIKRAM MEHTA DIN 00017762
Partner
Membership No. 105938 LANCY VARGHESE SESHAGIRI RAO M.V.S.
Company Secretary Jt. Managing Director & Group CFO
DIN 00029136
ICSI Membership No. FCS 9407
Place: Mumbai Place: Mumbai
Date: 24 May 2019 Date: 24 May 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Fair value is the price that would be received to sell an asset • it is held primarily for the purpose of being traded;
or paid to transfer a liability in an orderly transaction between
• it is due to be settled within 12 months after the reporting
market participants at the measurement date, regardless of
date; or the Group does not have an unconditional right
whether that price is directly observable or estimated using
to defer settlement of the liability for at least 12 months
another valuation technique. In estimating the fair value
after the reporting date. Terms of a liability that could, at
of an asset or a liability, the group takes in to account the
the option of the counterparty, result in its settlement
characteristics of the asset or liability if market participants
by the issue of equity instruments do not affect its
would take those characteristics into account when pricing
classification.
the asset or liability at the measurement date. Fair value
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
All other liabilities are classified as non-current. of equity of each subsidiary. Business combinations
policy explains how to account for any related goodwill.
Deferred tax assets and liabilities are classified as
non-current only. •
Eliminate in full intragroup assets and liabilities,
equity, income, expenses and cash flows relating to
III. Basis of consolidation
transactions between entities of the group (profits
The Consolidated Financial Statements incorporate the
or losses resulting from intragroup transactions that
financial statements of the Company and entities (including
are recognised in assets, such as inventory and fixed
special purpose entities) controlled by the Company and its
assets, are eliminated in full). Intragroup losses may
subsidiaries. Control is achieved where the Company:
indicate an impairment that requires recognition in the
• has power over the investee consolidated financial statements. Ind AS 12 Income
Taxes applies to temporary differences that arise from
• is exposed to, or has rights, to variable returns from its
the elimination of profits and losses resulting from
involvement with the investee; and
intragroup transactions.
• has the ability to use its power to affect its returns
Profit or loss and each component of other comprehensive
The Company reassess whether or not it controls an investee income are attributed to the owners of the Company and to
if facts and circumstances indicate that there are changes the non-controlling interests. Total comprehensive income of
to one or more of the three elements of control listed above. subsidiaries is attributed to the owners of the Company and
to the non-controlling interests even if this results in the
When the Company has less than majority of the voting
non-controlling interests having a deficit balance.
rights of an investee, it has power over the investee when
the voting rights are sufficient to give it the practical ability When necessary, adjustments are made to the financial
to direct the relevant activities of the investee unilaterally. statements of subsidiaries to bring their accounting policies
The Company considers all relevant facts and circumstances into line with the Group’s accounting policies.
in assessing whether or not the Company’s voting rights in
IV. Business combinations
an investee are sufficient to give it power, including;
Business combinations are accounted for using the
• the size of the Company’s holding of voting rights acquisition method. The consideration transferred in a
relative to the size and dispersion of holdings of the business combination is measured at fair value, which is
other vote holders; calculated as the sum of the acquisition-date fair values
of the assets transferred by the Group, liabilities incurred
• potential voting rights held by the Company, other vote
by the Group to the former owners of the acquiree and the
holders or other parties;
equity interests issued by the Group in exchange for control
• rights arising from other contractual arrangements; and of the acquiree. For this purpose, the liabilities assumed
include contingent liabilities representing present obligation
• any additional facts and circumstances that indicate
and they are measured at their acquisition date fair values
that the Company has, or does not have, the current
irrespective of the fact that outflow of resources embodying
ability to direct the relevant activities at the time that
economic benefits is not probable. Acquisition-related
decisions need to be made, including voting patterns
costs are generally recognised in Statement of Profit and
at previous shareholders’ meetings.
Loss as incurred.
Consolidation of a subsidiary begins when the Company
At the acquisition date, the identifiable assets acquired and
obtains control over the subsidiary and ceases when the
the liabilities assumed are recognised at their fair value at
Company loses control of the subsidiary. Specifically, income
the acquisition date, except that:
and expenses of a subsidiary acquired or disposed of during
the year are included in the consolidated statement of profit •
deferred tax assets or liabilities and liabilities or
and loss and other comprehensive income from the date the assets related to employee benefit arrangements
Company gains control until the date when the Company are recognised and measured in accordance with
ceases to control the subsidiary. Ind AS 12 Income Taxes and Ind AS 19 Employee
Benefits respectively;
Consolidation procedure:
• Combine like items of assets, liabilities, equity, income, • liabilities or equity instruments related to share-based
expenses and cash flows of the parent with those of its payment arrangements of the acquiree or share-based
subsidiaries. For this purpose, income and expenses of payment arrangements of the Group entered into to
the subsidiary are based on the amounts of the assets replace share-based payment arrangements of the
and liabilities recognised in the consolidated financial acquiree are measured in accordance with Ind AS 102
statements at the acquisition date. Share-based Payments at the acquisition date; and
• Offset (eliminate) the carrying amount of the parent’s • assets (or disposal groups) that are classified as held
investment in each subsidiary and the parent’s portion for sale in accordance with Ind AS 105 Non-current
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Assets Held for Sale and Discontinued Operations are recognize additional assets or liabilities if the new information
measured in accordance with that Standard. is obtained about facts and circumstances that existed as
of the acquisition date and if known, would have resulted
When the Group acquires a business, it assesses the financial
in the recognition of those assets and liabilities as of that
assets and liabilities assumed for appropriate classification
date. However, the measurement period shall not exceed the
and designation in accordance with the contractual terms,
period of one year from the acquisition date.
economic circumstances and pertinent conditions as at the
acquisition date. Business combinations involving entities or businesses
under common control shall be accounted for using the
Goodwill is measured as the excess of the sum of the
pooling of interest method.
consideration transferred, the amount of any non-controlling
interests in the acquiree, and the fair value of the acquirer’s V. Goodwill
previously held equity interest in the acquiree (if any) over Goodwill arising on an acquisition of a business is carried at
the net of the acquisition-date amounts of the identifiable cost as established at the date of acquisition of the business
assets acquired and the liabilities assumed. less accumulated impairment losses, if any.
For the purposes of impairment testing, goodwill is allocated
In case of bargain purchase, before recognizing gain in
to each of the Group’s cash-generating units (or groups of
respect thereof, the Group determines whether there exists
cash-generating units) that is expected to benefit from the
clear evidence of the underlying reasons for classifying the
synergies of the combination.
business combination as a bargain purchase. Thereafter, the
group reassesses whether it has correctly identified all A cash-generating unit to which goodwill has been allocated
of the assets acquired and all of the liabilities assumed is tested for impairment annually, or more frequently when
and recognizes any additional assets or liabilities that are there is indication that the unit may be impaired. If the
identified in that reassessment. The Group then reviews recoverable amount of the cash-generating unit is less than
the procedures used to measure the amounts that Ind its carrying amount, the impairment loss is allocated first to
AS requires for the purposes of calculating the bargain reduce the carrying amount of any goodwill allocated to the
purchase. If the gain remains after this reassessment and unit and then to the other assets of the unit pro rata based on
review, the Group recognizes it in other comprehensive the carrying amount of each asset in the unit. Any impairment
income and accumulates the same in equity as capital loss for goodwill is recognized directly in the consolidated
reserve. This gain is attributed to the acquirer. If there Statement of Profit and Loss. An impairment loss recognized
does not exist clear evidence of the underlying reasons for for goodwill is not reversed in subsequent periods.
classifying the business combination as a bargain purchase,
On disposal of the relevant cash-generating unit, the
the Group recognises the gain, after reassessing and
attributable amount of goodwill is included in the
reviewing, directly in equity as capital reserve.
determination of the profit or loss on disposal.
Non-controlling interests that are present ownership
The Group’s policy for goodwill arising on the acquisition of an
interests and entitle their holders to a proportionate share
associate and a joint venture is described at note 2(VI) below.
of the entity’s net assets in the event of liquidation may be
initially measured either at fair value or at the non-controlling VI. Investment in associates and joint ventures
interests’ proportionate share of the recognised amounts An associate is an entity over which the Group has significant
of the acquiree’s identifiable net assets. The choice of influence. Significant influence is the power to participate in
measurement basis is made on a transaction-by-transaction the financial and operating policy decisions of the investee
basis. Other types of non-controlling interests are measured but is not control or joint control over those policies.
at fair value or, when applicable, on the basis specified in
A joint venture is a joint arrangement whereby the parties
another Ind AS.
that have joint control of the arrangement have rights to
When a business combination is achieved in stages, the the net assets of the joint arrangement. Joint control is the
Group’s previously held equity interest in the acquiree is contractually agreed sharing of control of an arrangement,
remeasured to fair value at the acquisition date (i.e. the date which exists only when decisions about the relevant
when the Group obtains control) and the resulting gain or activities require unanimous consent of the parties
loss, if any, is recognised in the Consolidated Statement of sharing control.
Profit and Loss.
The results and assets and liabilities of associates or joint
If the initial accounting for a business combination is ventures are incorporated in these consolidated financial
incomplete by the end of the financial year, the provisional statements using the equity method of accounting, except
amounts for which the accounting is incomplete shall when the investment, or a portion thereof, is classified as
be disclosed in the financial statements and provisional held for sale, in which case it is accounted for in accordance
amounts recognized at the acquisition date shall be with Ind AS 105 – Non-current Assets Held for Sale and
retrospectively adjusted during the measurement period. Discontinued Operations. Under the equity method, an
During the measurement period, the group shall also investment in an associate or a joint venture is initially
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
recognised in the consolidated statement of financial Revenue is adjusted for variable consideration such as
position at cost and adjusted thereafter to recognise the discounts, rebates, refunds, credits, price concessions,
Group’s share of the profit or loss and other comprehensive incentives, or other similar items in a contract when they are
income of the associate or joint venture. When the Group’s highly probable to be provided.
share of losses of an associate or a joint venture exceeds
The amount of revenue excludes any amount collected on
the Group’s interest in that associate or joint venture (which
behalf of third parties. The Company recognises revenue
includes any long-term interests that, in substance, form
generally at the point in time when the products are delivered
part of the Group’s net investment in the associate or joint
to customer or when it is delivered to a carrier for export
venture), the Group discontinues recognising its share of
sale, which is when the control over product is transferred
further losses. Additional losses are recognised only to the
to the customer. In contracts where freight is arranged
extent that the Group has incurred legal or constructive
by the Company and recovered from the customers, the same
obligations or made payments on behalf of the associate or
is treated as a separate performance obligation and revenue
joint venture.
is recognized when such freight services are rendered.
An investment in an associate or a joint venture is accounted
for using the equity method from the date on which
In revenue arrangements with multiple performance
the investee becomes an associate or a joint venture. obligations, the Company accounts for individual products
On acquisition of the investment in an associate or a joint and services separately if they are distinct – i.e. if a product
venture, any excess of the cost of the investment over the or service is separately identifiable from other items in
Group’s share of the net fair value of the identifiable assets the arrangement and if a customer can benefit from it.
and liabilities of the investee is recognised as goodwill, which The consideration is allocated between separate products
is included within the carrying amount of the investment. and services in the arrangement based on their stand-alone
Any excess of the Group’s share of the net fair value of selling prices.
the identifiable assets and liabilities over the cost of the
Revenue from sale of by products are included in revenue.
investment, after reassessment, is recognised immediately
Revenue from sale of power is recognised when delivered and
in consolidated statement of profit and loss in the period in
measured based on the bilateral contractual arrangements.
which the investment is acquired.
Contract balances
After application of the equity method of accounting, the
i. Contract assets
Group determines whether there is any objective evidence
A contract asset is the right to consideration in
of impairment as a result of one or more events that
exchange for goods or services transferred to the
occurred after the initial recognition of the net investment
customer. If the Company performs by transferring
in an associate or a joint venture and that event (or events)
goods or services to a customer before the customer
has an impact on the estimated future cash flows from
pays consideration or before payment is due, a contract
the net investment that can be reliably estimated. If there
asset is recognised for the earned consideration
exists such an objective evidence of impairment, then it is
including Trade receivables
necessary to recognise impairment loss with respect to the
Group’s investment in an associate or a joint venture. ii. Contract liabilities
A contract liability is the obligation to transfer goods
The Group discontinues the use of the equity method from
or services to a customer for which the Company has
the date when the investment ceases to be an associate
received consideration (or an amount of consideration is
or a joint venture, or when the investment is classified as
due) from the customer. If a customer pays consideration
held for sale.
before the Company transfers goods or services to the
When a group entity transacts with an associate or a joint customer, a contract liability is recognised when the
venture of the Group, profits and losses resulting from payment is made or the payment is due (whichever is
the transactions with the associate or joint venture are earlier). Contract liabilities are recognised as revenue
recognised in the Group’s consolidated financial statements when the Company performs under the contract
only to the extent of interests in the associate or joint venture including Advance received from Customer
that are not related to the Group.
iii. Refund liabilities
VII. Revenue recognition A refund liability is the obligation to refund some
A. Sale of goods or all of the consideration received (or receivable)
The Company recognizes revenue when control over from the customer and is measured at the
the promised goods or services is transferred to the amount the Company ultimately expects it will have
customer at an amount that reflects the consideration to to return to the customer including volume rebates
which the Company expects to be entitled in exchange for and discounts. The Company updates its estimates of
those goods or services. refund liabilities at the end of each reporting period.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
For defined benefit retirement benefit plans, the cost of XIII. Share-based payment arrangements
providing benefits is determined using the projected unit Equity-settled share-based payments to employees and
credit method, with actuarial valuations being carried out at others providing similar services are measured at the fair value
the end of each annual reporting period. Remeasurement, of the equity instruments at the grant date. Details regarding
comprising actuarial gains and losses, the effect of the the determination of the fair value of equity-settled
changes to the asset ceiling (if applicable) and the return share-based transactions are set out in note 38.
on plan assets (excluding interest), is reflected immediately
The fair value determined at the grant date of the
in the statement of financial position with a charge or
equity-settled share-based payments is expensed on a
credit recognised in other comprehensive income in the
straight-line basis over the vesting period, based on the
period in which they occur. Remeasurement recognised in
Group’s estimate of equity instruments that will eventually
other comprehensive income is reflected immediately in
vest, with a corresponding increase in equity. At the end of
retained earnings and will not be reclassified to profit or loss.
each reporting period, the Group revises its estimate of the
Past service cost is recognised in profit or loss in the period
number of equity instruments expected to vest. The impact
of a plan amendment or when the Company recognizes
of the revision of the original estimates, if any, is recognised
corresponding restructuring cost whichever is earlier.
in profit or loss such that the cumulative expense reflects
Net interest is calculated by applying the discount rate to the
the revised estimate, with a corresponding adjustment to
net defined benefit liability or asset. Defined benefit costs
the equity-settled employee benefits reserve.
are categorised as follows:
The Company has created an Employee Benefit Trust
1.
service cost (including current service cost,
for providing share-based payment to its employees.
past service cost, as well as gains and losses on
The Company uses the Trust as a vehicle for distributing
curtailments and settlements);
shares to employees under the employee remuneration
2. net interest expense or income; and schemes. The Trust buys shares of the Company from the
market, for giving shares to employees. The Company treats
3. remeasurement
Trust as its extension and shares held by the Trust are
The Group presents the first two components of defined treated as treasury shares.
benefit costs in profit or loss in the line item ‘Employee
Own equity instruments that are reacquired (treasury
benefits expenses’. Curtailment gains and losses are
shares) are recognized at cost and deducted from Equity.
accounted for as past service costs.
No gain or loss is recognized in profit or loss on the purchase,
The retirement benefit obligation recognised in the sale, issue or cancellation of the Company’s own equity
consolidated statement of financial position represents instruments. Share options exercised during the reporting
the actual deficit or surplus in the Group’s defined benefit period are satisfied with treasury shares.
plans. Any surplus resulting from this calculation is limited
XIV. Taxes
to the present value of any economic benefits available in
Income tax expense represents the sum of the tax currently
the form of refunds from the plans or reductions in future
payable and deferred tax.
contributions to the plans.
Current tax
A liability for a termination benefit is recognised at the earlier
Current tax is the amount of expected tax payable based on
of when the entity can no longer withdraw the offer of the
the taxable profit for the period as determined in accordance
termination benefit and when the entity recognises any
with the applicable tax rates and the provisions of the Income
related restructuring costs.
Tax Act, 1961 and other applicable tax laws in the countries
Short-term and other long-term employee benefits where the Group operates and generates taxable income.
A liability is recognised for benefits accruing to employees
Deferred tax
in respect of wages and salaries, annual leave and sick
Deferred tax is recognised on temporary differences
leave in the period the related service is rendered at the
between the carrying amounts of assets and liabilities in the
undiscounted amount of the benefits expected to be paid in
consolidated financial statements and the corresponding
exchange for that service.
tax bases used in the computation of taxable profit.
Liabilities recognised in respect of short-term employee Deferred tax liabilities are recognised for all taxable
benefits are measured at the undiscounted amount of temporary differences. Deferred tax assets are recognised
the benefits expected to be paid in exchange for the for all deductible temporary differences to the extent that
related service. it is probable that taxable profits will be available against
Liabilities recognised in respect of other long-term employee which those deductible temporary differences can be
benefits are measured at the present value of the estimated utilised. Such deferred tax assets and liabilities are not
future cash outflows expected to be made by the Group recognised if the temporary difference arises from the
in respect of services provided by employees up to the initial recognition (other than in a business combination) of
reporting date. assets and liabilities in a transaction that affects neither the
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
taxable profit nor the accounting profit. In addition, deferred any import duties and other taxes (other than those
tax liabilities are not recognised if the temporary difference subsequently recoverable from the tax authorities), any
arises from the initial recognition of goodwill. directly attributable expenditure on making the asset
ready for its intended use, including relevant borrowing
Deferred tax liabilities are recognised for taxable temporary
costs for qualifying assets and any expected costs of
differences associated with investments in subsidiaries and
decommissioning. Expenditure incurred after the property,
associates, and interests in joint ventures, except where
plant and equipment have been put into operation, such as
the Group is able to control the reversal of the temporary
repairs and maintenance, are charged to the Statement of
difference and it is probable that the temporary difference
Profit and Loss in the period in which the costs are incurred.
will not reverse in the foreseeable future. Deferred tax assets
Major shut-down and overhaul expenditure is capitalised as
arising from deductible temporary differences associated
the activities undertaken improves the economic benefits
with such investments and interests are only recognised
expected to arise from the asset.
to the extent that it is probable that there will be sufficient
taxable profits against which to utilise the benefits of the An item of property, plant and equipment is derecognised
temporary differences and they are expected to reverse in upon disposal or when no future economic benefits are
the foreseeable future. expected to arise from the continued use of the asset.
Any gain or loss arising on the disposal or retirement of an
The carrying amount of deferred tax assets is reviewed at
item of property, plant and equipment is determined as the
the end of each reporting period and reduced to the extent
difference between the sales proceeds and the carrying
that it is no longer probable that sufficient taxable profits will
amount of the asset and is recognized in Statement of
be available to allow all or part of the asset to be recovered.
Profit and Loss.
Minimum Alternate Tax (MAT) paid in accordance with the
Assets in the course of construction are capitalised in the
tax laws, which gives future economic benefits in the form
assets under construction account. At the point when an
of adjustment to future income tax liability, is considered
asset is operating at management’s intended use, the cost
as a deferred tax asset if there is convincing evidence that
of construction is transferred to the appropriate category of
the Group will pay normal income tax. Accordingly, MAT
property, plant and equipment and depreciation commences.
is recognised as an asset in the Balance Sheet when it is
Costs associated with the commissioning of an asset and
probable that future economic benefit associated with it will
any obligatory decommissioning costs are capitalised where
flow to the Group.
the asset is available for use but incapable of operating
Deferred tax assets and liabilities are measured at the tax at normal levels until a period of commissioning has been
rates that are expected to apply in the period in which the completed. Revenue (net of cost) generated from production
liability is settled or the asset realised, based on tax rates during the trial period is capitalised.
(and tax laws) that have been enacted or substantively
Property, plant and equipment except freehold land held for
enacted by the end of the reporting period.
use in the production, supply or administrative purposes,
Deferred tax assets and deferred tax liabilities are offset if a are stated in the consolidated balance sheet at cost less
legally enforceable right exists to set off current tax assets accumulated depreciation and accumulated impairment
against current tax liabilities and the deferred taxes relate to losses, if any.
the same taxable entity and the same taxation authority.
The Group has elected to continue with the carrying value for
Current and deferred tax for the year all of its property, plant and equipment as recognised in the
Current and deferred tax are recognised in profit or loss, financial statements on transition to Ind AS measured as per
except when they relate to items that are recognised in other the previous GAAP and use that as its deemed cost as at the
comprehensive income or directly in equity, in which case, date of transition.
the current and deferred tax are also recognized in other
Depreciation commences when the assets are ready for
comprehensive income or directly in equity respectively.
their intended use. Depreciable amount for assets is the
Where current tax or deferred tax arises from the initial
cost of an asset, or other amount substituted for cost, less
accounting for a business combination, the tax effect is
its estimated residual value. Depreciation is recognized so
included in the accounting for the business combination.
as to write off the cost of assets (other than freehold land
Deferred tax assets and liabilities are offset when they relate and properties under construction) less their residual values
to income taxes levied by the same taxation authority and over their useful lives, using straight-line method as per the
the relevant entity intends to settle its current tax assets useful life prescribed in Schedule II to the Companies Act,
and liabilities on a net basis. 2013 except in respect of following categories of assets
located in India, in whose case the life of the assets has
XV. Property, plant and equipment
been assessed as under based on technical advice, taking
The cost of property, plant and equipment comprises its
into account the nature of the asset, the estimated usage
purchase price net of any trade discounts and rebates,
of the asset, the operating conditions of the asset, past
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
When significant parts of plant and equipment are required The Group has elected to continue with carrying value of
to be replaced at intervals, the Group depreciates them all its intangible assets recognised as on transition date
separately based on estimate of their specific useful lives. measured as per the previous GAAP and use that carrying
value as its deemed cost as of transition date.
Freehold land and leasehold land where the lease is
convertible to freehold land under lease agreements at XVII. Mining Assets
future dates at no additional cost, are not depreciated.
Exploration and evaluation
Exploration and evaluation expenditure incurred after
Assets held under finance leases are depreciated over
obtaining the mining right or the legal right to explore are
their expected useful lives on the same basis as owned
capitalised as exploration and evaluation assets (intangible
assets. However, when there is no reasonable certainty that
assets) and stated at cost less impairment. Exploration and
ownership will be obtained by the end of the lease term,
evaluation assets are assessed for impairment indicators at
assets are depreciated over the shorter of the lease term
least annually.
and their useful lives.
The Company measures its exploration and evaluation assets
Major overhaul costs are depreciated over the estimated
at cost and classifies as Property, plant and equipment
life of the economic benefit derived from the overhaul.
or intangible assets according to the nature of the assets
The carrying amount of the remaining previous overhaul cost
acquired and applies the classification consistently. To the
is charged to the Statement of Profit and Loss if the next
extent that tangible asset is consumed in developing an
overhaul is undertaken earlier than the previously estimated
intangible asset, the amount reflecting that consumption is
life of the economic benefit.
capitalised as a part of the cost of the intangible asset.
The Group reviews the residual value, useful lives and
Exploration expenditure includes all direct and allocated
depreciation method annually and, if expectations differ
indirect expenditure associated with finding specific mineral
from previous estimates, the change is accounted for as a
resources which includes depreciation and applicable
change in accounting estimate on a prospective basis.
operating costs of related support equipment and facilities
Depreciation on the property, plant and equipment of the and other costs of exploration activities:
Company’s foreign subsidiaries and jointly controlled entities
Acquisition costs - costs associated with acquisition of
has been provided on straight-line method as per the
licenses and rights to explore, including related professional
estimated useful life of such assets as follows:
fees. General exploration costs - costs of surveys and
Class of assets Years studies, rights of access to properties to conduct those
Buildings 15 to 50 years studies (e.g., costs incurred for environment clearance,
Plant and machinery 3 to 30 years defense clearance, etc.), and salaries and other expenses
Furniture and fixtures 3 to 10 years of geologists, geophysical crews and other personnel
Vehicles and aircrafts 4 to 5 years conducting those studies.
Office equipment 3 to 10 years
Costs of exploration drilling and equipping exploration -
Expenditure incurred on the acquisition of a license interest
XVI. Intangible assets
is initially capitalised on a license-by-license basis. Costs are
Intangible assets with finite useful lives that are acquired
held, undepleted, within exploration and evaluation assets
separately are carried at cost less accumulated amortisation
until such time as the exploration phase on the license area
and accumulated impairment losses. Amortisation is
is complete or commercial reserves have been discovered.
recognised on a straight-line basis over their estimated useful
lives. The estimated useful life and amortisation method Stripping cost
are reviewed at the end of each reporting period, with the Developmental stripping costs in order to obtain access
effect of any changes in estimate being accounted for on to quantities of mineral reserves that will be mined in
a prospective basis. Intangible assets with indefinite useful future periods are capitalised as part of mining assets.
lives that are acquired separately are carried at cost less Capitalisation of developmental stripping costs ends when
accumulated impairment losses. the commercial production of the mineral reserves begins.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Production stripping costs are incurred to extract the least annually, and whenever there is an indication that the
ore in the form of inventories and/or to improve access to asset may be impaired.
an additional component of an ore body or deeper levels
Recoverable amount is the higher of fair value less costs
of material. Production stripping costs are accounted for
to sell and value in use. In assessing value in use, the
as inventories to the extent the benefit from production
estimated future cash flows are discounted to their present
stripping activity is realized in the form of inventories.
value using a pre-tax discount rate that reflects current
Such costs are presented within mining assets. After initial market assessments of the time value of money and the
recognition, stripping activity assets are carried at cost less risks specific to the asset for which the estimates of future
accumulated amortisation and impairment. The expected cash flows have not been adjusted.
useful life of the identified component of the ore body is
If the recoverable amount of an asset (or cash-generating
used to depreciate or amortise the stripping asset.
unit) is estimated to be less than its carrying amount, the
Site restoration, rehabilitation and environmental costs: carrying amount of the asset (or cash-generating unit) is
Provision is made for costs associated with restoration reduced to its recoverable amount. An impairment loss is
and rehabilitation of mining sites as soon as the obligation recognised immediately in the Consolidated Statement
to incur such costs arises. Such restoration and closure of Profit and Loss, unless the relevant asset is carried at
costs are typical of extractive industries and they are a revalued amount, in which case the impairment loss
normally incurred at the end of the life of the mine. is treated as a revaluation decrease to the extent of
The costs are estimated on the basis of mine closure plans revaluation reserve.
and the estimated discounted costs of dismantling and
Any reversal of the previously recognised impairment loss
removing these facilities and the costs of restoration are
is limited to the extent that the asset’s carrying amount
capitalised. The provision for decommissioning assets is
does not exceed the carrying amount that would have
based on the current estimates of the costs for removing
been determined if no impairment loss had previously
and decommissioning production facilities, the forecast
been recognised.
timing of settlement of decommissioning liabilities and
the appropriate discount rate. A corresponding provision is XIX. Inventories
created on the liability side. The capitalised asset is charged Inventories are stated at the lower of cost and net
to profit or loss over the life of the asset through depreciation realisable value.
over the life of the operation and the provision is increased
Cost of raw materials include cost of purchase and other
each period via unwinding the discount on the provision.
costs incurred in bringing the inventories to their present
Management estimates are based on local legislation and/
location and condition. Cost of finished goods and work in
or other agreements. The actual costs and cash outflows
progress include cost of direct materials and labour and a
may differ from estimates because of changes in laws and
proportion of manufacturing overheads based on the normal
regulations, changes in prices, analysis of site conditions
operating capacity but excluding borrowing costs.
and changes in restoration technology. Details of such
provisions are set out in note 22. Costs of inventories are determined on weighted average
basis. Net realisable value represents the estimated selling
XVIII. Impairment of Property, plant and equipment and
price for inventories less all estimated costs of completion
intangible assets other than goodwill
and costs necessary to make the sale.
At the end of each reporting period, the Group reviews the
carrying amounts of its tangible and intangible assets to XX. Provisions
determine whether there is any indication that those assets Provisions are recognised when the Group has a present
have suffered an impairment loss. If any such indication obligation (legal or constructive), as a result of past events,
exists, the recoverable amount of the asset is estimated and it is probable that an outflow of resources, that can be
in order to determine the extent of the impairment loss (if reliably estimated, will be required to settle such an obligation.
any). Where it is not possible to estimate the recoverable
The amount recognised as a provision is the best estimate
amount of an individual asset, the Group estimates the
of the consideration required to settle the present obligation
recoverable amount of the cash-generating unit to which
at the balance sheet date, taking into account the risks and
the asset belongs. Where a reasonable and consistent basis
uncertainties surrounding the obligation. When a provision
of allocation can be identified, corporate assets are also
is measured using the cash flows estimated to settle the
allocated to individual cash-generating units, or otherwise
present obligation, its carrying amount is the present value
they are allocated to the smallest group of cash-generating
of those cash flows (when the effect of the time value of
units for which a reasonable and consistent allocation basis
money is material).
can be identified.
When some or all of the economic benefits required to settle
Intangible assets with indefinite useful lives and intangible
a provision are expected to be recovered from a third party,
assets not yet available for use are tested for impairment at
a receivable is recognized as an asset if it is virtually certain
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
that reimbursement will be received and the amount of the • The asset is held within a business model whose
receivable can be measured reliably. objective is achieved by both collecting contractual
cash flows and selling financial assets; and
Onerous contracts
Present obligations arising under onerous contracts are • The contractual terms of the financial asset give
recognised and measured as provisions. An onerous contract rise on specified dates to cash flows that are
is considered to exist where the Group has a contract under solely payments of principal and interest on the
which the unavoidable costs of meeting the obligations principal amount outstanding.
under the contract exceed the economic benefits expected
Debt instruments included within the FVTOCI
to be received from the contract.
category are measured initially as well as at each
XXI. Financial Instruments reporting date at fair value. Fair value movements
Financial assets and financial liabilities are recognised when are recognized in the Other Comprehensive Income
a Group entity becomes a party to the contractual provisions (OCI). However, the Group recognizes interest income,
of the instrument. impairment losses & reversals and foreign exchange
gain or loss in the Consolidated Statement of Profit and
Financial assets and financial liabilities are initially measured
Loss. On derecognition of the asset, cumulative gain or
at fair value. Transaction costs that are directly attributable
loss previously recognised in OCI is reclassified from
to the acquisition or issue of financial assets and financial
the equity to Consolidated Statement of Profit and Loss.
liabilities (other than financial assets and financial liabilities
Interest earned whilst holding FVTOCI debt instrument
at fair value through Statement of Profit and Loss (FVTPL))
is reported as interest income using the EIR method.
are added to or deducted from the fair value of the financial
assets or financial liabilities, as appropriate, on initial All equity investments in scope of Ind AS 109 are
recognition. Transaction costs directly attributable to the measured at fair value. Equity instruments which
acquisition of financial assets or financial liabilities at fair are held for trading and contingent consideration
value through profit and loss are recognised immediately in recognised by an acquirer in a business combination
Consolidated Statement of Profit and Loss. to which Ind AS103 applies are classified as at FVTPL.
For all other equity instruments, the Group may make an
A. Financial assets
irrevocable election to present in other comprehensive
a) Recognition and initial measurement
income subsequent changes in the fair value. The Group
A financial asset is initially recognised at fair value
makes such election on an instrument-by-instrument
and, for an item not at FVTPL, transaction costs that
basis. The classification is made on initial recognition
are directly attributable to its acquisition or issue.
and is irrevocable.
Purchases and sales of financial assets are recognised
on the trade date, which is the date on which the If the Group decides to classify an equity instrument
Group becomes a party to the contractual provisions of as at FVTOCI, then all fair value changes on the
the instrument. instrument, excluding dividends, are recognized in the
OCI. There is no recycling of the amounts from OCI to
b) Classification of financial assets
Consolidated Statement of Profit and Loss, even on
On initial recognition, a financial asset is classified
sale of investment. However, the Group may transfer
to be measured at amortised cost, fair value through
the cumulative gain or loss within equity.
other comprehensive income (FVTOCI) or FVTPL.
Equity instruments included within the FVTPL category
A financial asset is measured at amortised cost if
are measured at fair value with all changes recognized
it meets both of the following conditions and is not
in the Consolidated Statement of Profit and Loss.
designated at FVTPL:
All other financial assets are classified as
• The asset is held within a business model whose
measured at FVTPL.
objective is to hold assets to collect contractual
cash flows; and In addition, on initial recognition, the Group may
irrevocably designate a financial asset that otherwise
The contractual terms of the financial asset give
meets the requirements to be measured at amortised
rise on specified dates to cash flows that are
cost or at FVTOCI as at FVTPL if doing so eliminates or
solely payments of principal and interest on the
significantly reduces and accounting mismatch that
principal amount outstanding.
would otherwise arise.
A debt instrument is classified as FVTOCI only if it
Financial assets at FVTPL are measured at fair value
meets both the of the following conditions and is not
at the end of each reporting period, with any gains
recognised at FVTPL;
and losses arising on remeasurement recognized in
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
consolidated statement of profit or loss. The net gain be recognised and the part that is no longer recognised
or loss recognized in consolidated statement of profit on the basis of the relative fair values of those parts.
or loss incorporates any dividend or interest earned on
d) Impairment
the financial asset and is included in the ‘other income’
The Group applies the expected credit loss model
line item. Dividend on financial assets at FVTPL is
for recognising impairment loss on financial assets
recognized when:
measured at amortised cost, debt instruments at FVTOCI,
•
The Group’s right to receive the dividends lease receivables, trade receivables, other contractual
is established, rights to receive cash or other financial asset, and
financial guarantees not designated as at FVTPL.
•
It is probable that the economic benefits
associated with the dividends will flow to the entity, Expected credit losses are the weighted average
of credit losses with the respective risks of default
• The dividend does not represent a recovery of
occurring as the weights. Credit loss is the difference
part of cost of the investment and the amount of
between all contractual cash flows that are due to
dividend can be measured reliably.
the Group in accordance with the contract and all
c) Derecognition of financial assets the cash flows that the Group expects to receive (i.e.
The Group derecognises a financial asset when the all cash shortfalls), discounted at the original effective
contractual rights to the cash flows from the asset interest rate (or credit-adjusted effective interest
expire, or when it transfers the financial asset and rate for purchased or originated credit-impaired
substantially all the risks and rewards of ownership of financial assets). The Group estimates cash flows
the asset to another party. If the Group neither transfers by considering all contractual terms of the financial
nor retains substantially all the risks and rewards of instrument (for example, prepayment, extension, call
ownership and continues to control the transferred and similar options) through the expected life of that
asset, the Group recognises its retained interest in financial instrument.
the asset and an associated liability for amounts it
The Group measures the loss allowance for a financial
may have to pay. If the Group retains substantially all
instrument at an amount equal to the lifetime expected
the risks and rewards of ownership of a transferred
credit losses if the credit risk on that financial
financial asset, the Group continues to recognise the
instrument has increased significantly since initial
financial asset and also recognises a collateralised
recognition. If the credit risk on a financial instrument
borrowing for the proceeds received.
has not increased significantly since initial recognition,
On derecognition of a financial asset in its entirety, the the Group measures the loss allowance for that
difference between the asset’s carrying amount and the financial instrument at an amount equal to 12-month
sum of the consideration received and receivable and expected credit losses. 12-month expected credit
the cumulative gain or loss that had been recognised losses are portion of the life-time expected credit
in other comprehensive income and accumulated in losses and represent the lifetime cash shortfalls that
equity is recognised in profit or loss if such gain or loss will result if default occurs within the 12 months after
would have otherwise been recognised in profit or loss the reporting date and thus, are not cash shortfalls that
on disposal of that financial asset. are predicted over the next 12 months.
On derecognition of a financial asset other than in If the Group measured loss allowance for a financial
its entirety (e.g. when the Group retains an option instrument at lifetime expected credit loss model
to repurchase part of a transferred asset), the in the previous period, but determines at the end
Group allocates the previous carrying amount of of a reporting period that the credit risk has not
the financial asset between the part it continues to increased significantly since initial recognition due
recognise under continuing involvement, and the part to improvement in credit quality as compared to the
it no longer recognises on the basis of the relative previous period, The Group again measures the loss
fair values of those parts on the date of the transfer. allowance based on 12-month expected credit losses.
The difference between the carrying amount allocated
When making the assessment of whether there has
to the part that is no longer recognised and the sum
been a significant increase in credit risk since initial
of the consideration received for the part no longer
recognition, the Group uses the change in the risk of a
recognised and any cumulative gain or loss allocated
default occurring over the expected life of the financial
to it that had been recognised in other comprehensive
instrument instead of the change in the amount of
income is recognised in profit or loss if such gain or loss
expected credit losses. To make that assessment,
would have otherwise been recognised in profit or loss
the Group compares the risk of a default occurring
on disposal of that financial asset. A cumulative gain or
on the financial instrument as at the reporting date
loss that had been recognised in other comprehensive
with the risk of a default occurring on the financial
income is allocated between the part that continues to
instrument as at the date of initial recognition and
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
considers reasonable and supportable information, loss is recognised in Consolidated Statement of Profit
that is available without undue cost or effort, that is and Loss on the purchase, sale, issue or cancellation of
indicative of significant increases in credit risk since the Group’s own equity instruments.
initial recognition.
c) Financial liabilities
For trade receivables or any contractual right to Financial liabilities are classified as either financial
receive cash or another financial asset that result from liabilities ‘at FVTPL’ or ‘other financial liabilities’.
transactions that are within the scope of Ind AS 115,
Financial liabilities at FVTPL:
The Group always measures the loss allowance at an
Financial liabilities are classified as at FVTPL when
amount equal to lifetime expected credit losses.
the financial liability is either held for trading or it is
Further, for the purpose of measuring lifetime expected designated as at FVTPL.
credit loss allowance for trade receivables, the Group
A financial liability is classified as held for trading if:
has used a practical expedient as permitted under
Ind AS 109. This expected credit loss allowance is • It has been incurred principally for the purpose of
computed based on a provision matrix which takes into repurchasing it in the near term; or
account historical credit loss experience and adjusted
• on initial recognition it is part of a portfolio of
for forward-looking information.
identified financial instruments that the Group
The impairment requirements for the recognition and manages together and has a recent actual pattern
measurement of a loss allowance are equally applied of short-term profit-taking; or
to debt instruments at FVTOCI except that the loss
• it is a derivative that is not designated and
allowance is recognised in other comprehensive
effective as a hedging instrument.
income and is not reduced from the carrying amount in
the balance sheet. A financial liability other than a financial liability held
for trading may be designated as at FVTPL upon initial
e) Effective interest method
recognition if:
The effective interest method is a method of calculating
the amortised cost of a debt instrument and of •
such designation eliminates or significantly
allocating interest income over the relevant period. reduces a measurement or recognition
The effective interest rate is the rate that exactly inconsistency that would otherwise arise;
discounts estimated future cash receipts (including all
• the financial liability forms part of a group of
fees and points paid or received that form an integral
financial assets or financial liabilities or both,
part of the effective interest rate, transaction costs and
which is managed and its performance is
other premiums or discounts) through the expected life
evaluated on a fair value basis, in accordance
of the debt instrument, or, where appropriate, a shorter
with the Group’s documented risk management
period, to the net carrying amount on initial recognition.
or investment strategy, and information about the
Income is recognised on an effective interest basis grouping is provided internally on that basis; or
for debt instruments other than those financial assets
• it forms part of a contract containing one or more
classified as at FVTPL. Interest income is recognized
embedded derivatives, and Ind AS 109 permits the
in the consolidated statement of profit or loss and is
entire combined contract to be designated as at
included in the ‘Other income’ line item.
FVTPL in accordance with Ind AS 109.
B. Financial liabilities and equity instruments
Financial liabilities at FVTPL are stated at fair value,
a) Classification as debt or equity
with any gains or losses arising on remeasurement
Debt and equity instruments issued by a group entity
recognised in Consolidated Statement of Profit and
are classified as either financial liabilities or as equity
Loss. The net gain or loss recognised in Consolidated
in accordance with the substance of the contractual
Statement of Profit and Loss incorporates any interest
arrangements and the definitions of a financial liability
paid on the financial liability and is included in the
and an equity instrument.
Consolidated Statement of Profit and Loss. For liabilities
b) Equity instruments designated at FVTPL, fair value gains/losses attributable
An equity instrument is any contract that evidences to changes in own credit risk are recognised in OCI.
a residual interest in the assets of an entity after
The Group derecognises financial liabilities when, and
deducting all of its liabilities. Equity instruments issued
only when, the Group’s obligations are discharged,
by the Group are recognised at the proceeds received,
cancelled or they expire. The difference between the
net of direct issue costs.
carrying amount of the financial liability derecognised
Repurchase of the Group’s own equity instruments is and the consideration paid and payable is recognised
recognised and deducted directly in equity. No gain or in the Consolidated Statement of Profit and Loss.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Derecognition of financial liabilities: If the hybrid contract contains a host that is a financial
The Group derecognises financial liabilities when, and asset within the scope of Ind AS 109, the Group does
only when, the Group’s obligations are discharged, not separate embedded derivatives. Rather, it applies
cancelled or have expired. An exchange between with a the classification requirements contained in Ind AS 109
lender of debt instruments with substantially different to the entire hybrid contract. Derivatives embedded in
terms is accounted for as an extinguishment of the all other host contracts are accounted for as separate
original financial liability and the recognition of a new derivatives and recorded at fair value if their economic
financial liability. Similarly, a substantial modification characteristics and risks are not closely related to
of the terms of an existing financial liability (whether those of the host contracts and the host contracts
or not attributable to the financial difficulty of the are not held for trading or designated at fair value
debtor) is accounted for as an extinguishment of the though profit or loss. These embedded derivatives
original financial liability and the recognition of a new are measured at fair value with changes in fair value
financial liability. The difference between the carrying recognised in profit or loss, unless designated as
amount of the financial liability derecognised and the effective hedging instruments.
consideration paid and payable is recognised in the
f) Hedge accounting
consolidated statement of profit or loss.
The Group designates certain hedging instruments,
d) Derivative financial instruments which include derivatives, embedded derivatives and
The Group enters into a variety of derivative financial non-derivatives in respect of foreign currency, interest
instruments to manage its exposure to interest rate and commodity risk, as either cash flow hedge, fair
rate, commodity price and foreign exchange value hedge or hedges of net investments in foreign
rate risks, including foreign exchange forward operations. Hedges of foreign currency risk on firm
contracts, commodity foreign exchange options, commitments are accounted for as cash flow hedges.
forward contracts, interest rate swaps and cross
At the inception of the hedge relationship, the entity
currency swaps.
documents the relationship between the hedging
Derivatives are initially recognised at fair value at the instrument and the hedged item, along with its risk
date the derivative contracts are entered into and are management objectives and its strategy for undertaking
subsequently remeasured to their fair value at the end various hedge transactions. Furthermore, at the
of each reporting period. The resulting gain or loss is inception of the hedge and on an ongoing basis, the
recognised in Consolidated Statement of Profit and Group documents whether the hedging instrument
Loss immediately unless the derivative is designated is highly effective in offsetting changes in fair
and effective as a hedging instrument, in which values or cash flows of the hedged item attributable
event the timing of the recognition in Consolidated to hedged risk.
Statement of Profit and Loss depends on the nature of
the hedge item.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
(i) Fair value hedges accounted for in a way similar to cash flow hedges.
Changes in fair value of the designated portion of Gains or losses on the hedging instrument
derivatives that qualify as fair value hedges are relating to the effective portion of the hedge
recognized in the consolidated statement of profit are recognised in other comprehensive income
or loss immediately, together with any changes in and accumulated under the heading of foreign
the fair value of the hedged asset or liability that currency translation reserve. The gains or losses
are attributable to the hedged risk. The change in relating to the ineffective portion are recognised
the fair value of the designated portion of hedging immediately in the profit or loss.
instrument and the change in the hedged item
Gains and losses on the hedging instrument
attributable to hedged risk are recognized in profit
relating to the effective portion of the hedge
or loss in the line item relating to the hedged item.
accumulated in the foreign currency translation
Hedge accounting is discontinued when the reserve are reclassified to Consolidated
hedging instrument expires or is sold, terminated, Statement of Profit and Loss on the disposal of
or exercised, or when it no longer qualifies for the foreign operation.
hedge accounting. For fair value hedges relating
XXII. Cash and cash equivalents:
to items carried at amortised cost, the fair value
Cash and cash equivalent in the Balance Sheet comprise
adjustment to the carrying amount of the hedged
cash at banks and on hand and short-term deposits with an
item arising from the hedged risk is amortised to
original maturity of three months or less, which are subject
profit or loss from that date.
to insignificant risk of changes in value.
(ii)
Cash flow hedges
XXIII. Earnings per share:
The effective portion of changes in fair value
Basic earnings per share is computed by dividing the profit
of derivatives that are designated and qualify
/ (loss) after tax by the weighted average number of equity
as cash flow hedges is recognized in other
shares outstanding during the year. The weighted average
comprehensive income and accumulated under
number of equity shares outstanding during the year is
the heading of cash flow hedging reserve.
adjusted for treasury shares, bonus issue, bonus element
The gain or loss relating to the ineffective portion
in a rights issue to existing shareholders, share split and
is recosnised immediately in profit or loss.
reverse share split (consolidation of shares).
Amounts previously recognised in other
Diluted earnings per share is computed by dividing the
comprehensive income and accumulated in
profit / (loss) after tax as adjusted for dividend, interest and
equity relating to effective portion as described
other charges to expense or income (net of any attributable
above are reclassified to profit or loss in the
taxes) relating to the dilutive potential equity shares, by the
periods when the hedged item affects profit or
weighted average number of equity shares considered for
loss, in the same line as the recognised hedged
deriving basic earnings per share and the weighted average
item. However, when the hedged forecast
number of equity shares which could have been issued
transaction results in the recognition of a
on the conversion of all dilutive potential equity shares
non-financial asset or a non-financial liability,
including the treasury shares held by the Company to satisfy
such gains or losses are transferred from equity
the exercise of the share options by the employees.
(but not as a reclassification adjustment) and
included in the initial measurement of the cost of
3. Key sources of estimation uncertainty and
the non-financial asset or non-financial liability.
critical accounting judgements
Hedge accounting is discontinued when the In the course of applying the policies outlined in all notes
hedging instrument expires or is sold, terminated, under section 2 above, the Company is required to make
or exercised, or when it no longer qualifies for judgements, estimates and assumptions about the
hedge accounting. Any gain or loss recognised in carrying amount of assets and liabilities that are not readily
other comprehensive income and accumulated apparent from other sources. The estimates and associated
in equity at that time remains in equity and assumptions are based on historical experience and other
is recognised when the forecast transaction factors that are considered to be relevant. Actual results may
is ultimately recognised in profit or loss. differ from these estimates.
When a forecast transaction is no longer expected
The estimates and underlying assumptions are reviewed
to occur, the gain or loss accumulated in equity is
on an ongoing basis. Revisions to accounting estimates are
recognised immediately in profit or loss.
recognized in the period in which the estimate is revised if
(iii)
Hedges of net investments in a foreign operation the revision affects only that period, or in the period of the
Hedges of net investments in a foreign operation, revision and future period, if the revision affects current
including a hedge of a monetary item that is and future period.
accounted for as part of the net investment, are
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
A) Key sources of estimation uncertainty inputs such as liquidity risk, credit risk and volatility.
i) Useful lives of property, plant and equipment Information about the valuation techniques and inputs
Management reviews the useful lives of property, plant used in determining the fair value of various assets and
and equipment at least once a year. Such lives are liabilities are disclosed in note 41.
dependent upon an assessment of both the technical
vi) Taxes
lives of the assets and also their likely economic
Deferred tax assets are recognized for unused tax
lives based on various internal and external factors
losses to the extent that it is probable that taxable
including relative efficiency and operating costs.
profit will be available against which the losses can be
Accordingly, depreciable lives are reviewed annually
utilized. Significant management judgement is required
using the best information available to the Management.
to determine the amount of deferred tax assets that
ii) Impairment of property plant and equipment can be recognised, based upon the likely timing and
Determining whether the property, plant and the level of future taxable profits together with future
equipment are impaired requires an estimate in the tax planning strategies.
value in use of plant and equipment. The value in use
MAT is assessed on book profits adjusted for certain
calculation requires the Management to estimate the
items as compared to the adjustments followed for
future cash flows expected to arise from the property,
assessing regular income tax under normal provisions.
plant and equipment and a suitable discount rate in
MAT paid in excess of regular income tax during a year
order to calculate present value. When the actual cash
can be set off against regular income taxes within a
flows are less than expected, a material impairment
specified period in which MAT credit arises, subject to
loss may arise.
the limits prescribed.
iii) Impairment of investments in joint ventures and
vii)
Impairment of Goodwill
associate
Determining whether the goodwill acquired in business
Determining whether the investments in joint ventures
combinations are impaired, requires an estimate of
and associate are impaired requires an estimate in
recoverable amount of the Group’s cash Generating
the value in use of investments. In considering the
unit (or groups of cash generating units). In considering
value in use, the Management have anticipated the
the recoverable value of cash generating unit, the
future commodity prices, capacity utilization of plants,
management have anticipated the future benefits
operating margins, mineable resources and availability
to arise from commodity prices, capacity utilization
of infrastructure of mines, discount rates and other
of plants, mineable resources and availability of
factors of the underlying businesses / operations of
infrastructure of mines, discount rates and other
the investee companies. Any subsequent changes to
factors of the underlying unit. If the recoverable
the cash flows due to changes in the above mentioned
amount of cash generating unit is less than its carrying
factors could impact the carrying value of investments.
amount, the impairment loss is allocated first to reduce
iv) Contingencies the carrying amount of any goodwill allocated to the
In the normal course of business, contingent unit and then to the other assets of the unit pro rata
liabilities may arise from litigation and other claims based on the carrying amount of each asset in the unit.
against the Company. Potential liabilities that are Any Impairment loss for goodwill is recognised directly
possible but not probable of crystalising or are very in the consolidated statement of profit and loss.
difficult to quantify reliably are treated as contingent
B) Critical accounting judgements
liabilities. Such liabilities are disclosed in the notes
i)
Control over JSW Realty & Infrastructure Private Lim-
but are not recognized. The cases which have been
ited (RIPL)
determined as remote by the Group are not disclosed.
RIPL has developed a residential township in
Contingent assets are not recognized but disclosed in Vijayanagar, Karnataka on the land taken on lease
the financial statements when an inflow of economic from the Company for a period of 30 years and
benefits is probable. provides individual housing units on rent to the
employees of the Company or other group companies.
v) Fair value measurements
RIPL is not allowed to sub-let or assign its rights
When the fair values of financial assets or financial
under the arrangement without prior written consent
liabilities recorded or disclosed in the financial
of the Company. Though the Company does not hold
statements cannot be measured based on quoted
any ownership interest in RIPL, the Company has
prices in active markets, their fair value is measured
concluded that it has practical ability to direct the
using valuation techniques including the DCF model.
relevant activities of RIPL unilaterally, considering RIPL’s
The inputs to these models are taken from observable
dependency on the Company for funding significant
markets where possible, but where this is not feasible,
portion of its operation through subscription to
a degree of judgment is required in establishing
74.57% of preference share capital amounting to
fair values. Judgements include consideration of
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` 302 crores issued by RIPL and significant portion In case of arrangements which are identified to be in
of RIPL’s activities either involve or are conducted the nature of finance lease, the Company concluded
on behalf of the Company on the land provided on that it is impracticable to derive the relative fair values
long-term lease by the Company. of lease and other elements of the arrangement and has
accordingly determined the consideration for elements
ii)
Assessment of control over JSW Projects Limited
other than lease as a residual post appropriation of
(JSWPL)
lease payments derived based on lessee’s incremental
JSWPL operates Direct Reduced Iron Processing Plant
borrowing rate of interest on the lease obligation
(DRI), Coal Dry Quenching Plant (CDQ) and two thermal
corresponding to the respective gross asset values in
power plants. Although the long-term take or pay
the books of lessor.
arrangements entered into by the Company with JSWPL
for processing of DRI and CDQ have been identified to be v) Joint control over Monnet Ispat & Energy Limited
the arrangements in the nature of lease, the Company has (MIEL)
concluded that it does not have any ownership interest, The consortium of JSW Steel Limited and AION
voting right or representation in the Board of Directors Investments Private II Limited completed the acquisition
of JSWPL to direct its relevant activities unilaterally and of MIEL through their jointly controlled entity Creixent
accordingly it is not controlled by the Company. Special Steels Limited (“CSSL”) on 31 August 2018.
The Company has made an investment of ` 375 crores
iii) Arrangements in the nature of lease
through equity and redeemable preference shares in
The Company has entered into long-term arrangements
CSSL to acquire joint control in MIEL and have an effective
with third parties to facilitate continuous supply of gases
shareholding of 23.1% in MIEL. As per the Shareholding
to its steel plant at Vijaynagar. These arrangements
agreement, all the relevant activities of CSSL that affect
involve setting up of gas plants by the vendor/
the Company’s variable returns from its involvement
supplier in the Company’s premises to supply minimum
with CSSL/ MIEL have to be decided unanimously by
specified gas quantities to the Company on take or
a Steering Committee on which the Company has
pay basis. Based on assessment of the terms of the
representation and thus the Company has concluded
arrangements, review of past trends and confirmations
that it has joint control over CSSL/MIEL.
received from the counter parties, the Company has
concluded that these arrangements are not in the vi) Incentives under the State Industrial Policy
nature of lease considering more than insignificant The Company units at Dolvi in Maharashtra and
amount of output from these plants are being also Vijayanagar in Karnataka are eligible for incentives
supplied by the vendor / suppliers to third parties on under the respective State Industrial Policy and
consistent basis. have been availing incentives in the form of VAT
deferral / CST refunds.
iv)
Separating payments of lease from the other
payments The State Government of Maharashtra (‘GOM’) vide
If an arrangement contains a lease, the parties to the its Government Resolution (GR) issued the modalities
arrangement shall apply the requirements of Ind AS 17 for sanction and disbursement of incentives, under
to the lease element. Therefore, the Group is required GST regime, and introduced certain new conditions
to separate payments and other consideration required / restrictions for accruing incentive benefits granted
by the arrangement into those for the lease and for to the Company including denying incentives
other elements on the basis of their relative fair values. in certain cases.
However, the Group has concluded that it is The management has evaluated the impact of other
impracticable to separate both the elements reliably conditions imposed and has obtained legal advice on
and has recognized an asset and a liability at an the tenability of these changes in the said scheme.
amount equal to the carrying value of the specified Based on such legal advice, the Company has also
asset in the books of the lessor. Subsequently, the made the representation to GOM and believes that
liability has been reduced as payments are made and said Incentives would continue to be made available
an imputed finance charges on the liability recognized to the Company under the GST regime, since the new
using the Company’s incremental borrowing rate of conditions are not tenable legally and will contest
interest over the tenure of the arrangement, where it these changes appropriately.
is impracticable to determine the interest rate implicit
Accordingly, the Company has recognized grant income
in the lease. The total payments less payments made
without giving effect to the above restrictions and the
towards lease obligation and imputed finance charges
cumulative amount receivable towards the same is
have been considered to be the consideration for
considered to be good and recoverable.
elements other than lease.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Notes:
` in crores
As at As at
31 March 2019 31 March 2018
a) Freehold land which is yet to be registered in the name group entities Acre 21 29
Deemed cost 14 19
b) Freehold land and buildings which have been/agreed to be hypothecated/ Deemed cost 82 64
mortgaged to lenders of related parties
c) Leasehold land which is yet to be registered in the name of group entities Acre - 21
Deemed cost - 14
Carrying amount - 13
d) Other adjustments comprises:
Borrowing cost 26 23
Foreign exchange loss / (gain) (net) 237 19
g) Certain property, plant and equipments are pledged against borrowings, the details relating to which have been described in
Note 20 and 25.
h) The title deeds of immovable properties, included in property, plant and equipment are held in the name of the Company except
for leasehold land aggregating to ` 67 crores wherein the lease deed has expired and the Company has a right to convert the land
into freehold land subject to complying with certain conditions. The Company is in the process of converting the title into freehold
as per the lease cum sale agreement.
i) Property, plant and equipments includes proportionate share (50%) of assets under joint operation as below:
` in crores
Buildings Plant and equipments
Particulars
(Owned) (Owned)
Cost / deemed cost
At 31 March 2017 476 7
Additions - -
At 31 March 2018 476 7
Additions - -
At 31 March 2019 476 7
Accumulated depreciation
At 31 March 2017 32 1
Depreciation expense 16 1
At 31 March 2018 48 2
Depreciation expense 16 1
At 31 March 2019 64 3
Net book value
At 31 March 2019 412 4
At 31 March 2018 428 5
5. Capital work in progress includes exchange fluctuation of ` 317 crores (previous year ` 57 crores) and borrowing cost of ` 194
crores (previous year ` 78 crores), capitalised during the year.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
6. Goodwill
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Cost / deemed cost
Balance at the beginning of the year 1,642 1,637
Acquired pursuant to business combination (Refer note 39) 90 -
Translation reserve 99 5
Balance at the end of the year (a) 1,831 1,642
Accumulated amortisation and impairment
Balance at the beginning of the year 935 765
Impairment (refer note 48) - 166
Translation reserve 56 4
Balance at the end of the year (b) 991 935
Net book value (a-b) 840 707
Cash flow projections during the budget period are based on estimated coal extraction schedule and future prices of coal determined
based on the average of coal prices published in various analyst reports. The projections do not consider growth rate in the coal prices
from the year 2027-28 onwards.
Considering past trend of movement in coal prices, the management believes that the following changes in these key estimates would
result into carrying amount exceeding the recoverable amount:
a) Decrease in coal prices by 1% would result into change in recoverable value by ` 25 Crores.
b) Decrease in extraction schedule by 5% would result into change in recoverable value by ` 53 crores.
Cash flow projections during the budget period are based on estimated iron ore extraction schedule and future prices of iron ore
determined based on the average of iron ore prices published in various analyst reports. The projections do not consider growth rate in
the iron ore production schedule and iron ore prices from the year 2023-24 onwards.
Considering past trend of movement in iron ore prices, the management believes that the following changes in these key estimates
would result into carrying amount exceeding the recoverable amount.
a) Decrease in iron ore prices by 1% would result into change in recoverable value by ` 57 crores.
b) Decrease in extraction schedule by 5% would result into change in recoverable value by ` 37 crores.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
9. Investments (non-current)
As at 31 March 2019 As at 31 March 2018
Particulars Paid up value
No. of Shares ` in crores No. of Shares ` in crores
A Investment in equity instruments
Fully paid up
Quoted
(at fair value through other comprehensive income)
JSW Energy Limited ` 10 each 101,605,500 738 101,605,500 740
Unquoted
(at fair value through other comprehensive income)
Tarapur Environment Protection Society ` 100 each 244,885 4 244,885 4
Toshiba JSW Power Systems Private Limited ` 10 each 11,000,000 - 11,000,000 -
MJSJ Coal Limited ` 10 each 10,461,000 9 10,461,000 9
SICOM Limited ` 10 each 600,000 5 600,000 5
Kalyani Mukand Limited ` 1 each 480,000 $ 480,000 $
Ispat Profiles India Limited ` 1 each 1,500,000 $ 1,500,000 $
B Investments in preference shares
Fully paid up
Joint ventures
Unquoted (at fair value through profit or loss)
Rohne Coal Company Private Limited
1% non-cumulative preference shares ` 10 each 23,642,580 - 23,642,580 -
1% Series-A non-cumulative preference shares ` 10 each 7,152,530 5 7,152,530 7
1% Series-B non-cumulative preference shares ` 10 each 1,370,786 1 1,128,686 1
Unquoted (at amortised cost)
Creixent Special Steels Limited
0.01% Redeemable preference shares I ` 10 each 171,969,200 184 - -
0.01% Redeemable preference shares II ` 10 each 198,300,410 190 - -
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars
Non-current Current Non-current Current
Export benefits and entitlements 25 115 1 57
Insurance claim receivable 43 - 45 -
Application money paid towards securities @ - 121 -
Receivable for coal block development expenditure 117 - 117 -
Indirect tax balances refund due - 73 - 184
Government grant incentive income receivable (refer note 30(a)) 98 1,949 - 234
Others 16 160 11 131
Less: Allowance for doubtful balances - (80) (2) (76)
Total 299 2,217 293 530
Notes:
Considered good 299 2,217 293 530
Considered doubtful, provided - 80 2 76
@ - Less than ` 0.50 crores
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
13. Inventories
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Raw materials (at cost) 7,153 6,119
Work-in-progress (at cost) 583 773
Semi-finished/ finished goods (at cost or net realisable value) 4,564 3,700
Production consumables, fuel stock and stores and spares (at cost) 2,248 2,002
Total 14,548 12,594
Notes:
Details of stock-in-transit
Raw materials 2,189 2,232
Production consumables and stores and spares 151 191
Total 2,340 2,423
Write down of inventories to net realisable value amounted to ` 47 crores (31 March 2018 – ` Nil). These were recognised as an expense
during the year and included in ‘cost of materials consumed and changes in inventories of finished goods, work-in-progress and
stock-in-trade.
Inventories have been pledged as security against certain bank borrowings, the details relating to which have been described in
note 20 and 25.
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Mutual funds (quoted) 82 312
Total 82 312
Quoted
Aggregate book value 82 312
Aggregate market value 82 312
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Trade receivables considered good - Secured 4 -
Trade receivables considered good - Unsecured 7,068 4,616
Trade receivables which have significant increase in credit risk 160 160
Less: Allowance for doubtful debts (72) (72)
Trade Receivables – credit impaired 34 24
Less: Allowance for doubtful debts (34) (24)
Total 7,160 4,704
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The credit period on sales of goods ranges from 7 to 60 days with or without security
Before accepting any new customer, the Group uses an external credit scoring system to assess the potential customer’s credit quality
and defines credit limits by customer. Limits and scoring attributed to customers are reviewed once a year.
The Group does not generally hold any collateral or other credit enhancements over these balances nor does it have a legal right to offset
against any amounts owed by the Group to the counterparty.
Trade receivable have been given as collateral towards borrowings, the details relating to which has been described in note 20 and 25.
Credit risk management regarding trade receivables has been described in note 42 (H).
Trade receivables from related party has been disclosed in note 43.
Trade receivables does not include any receivables from directors and officers of the company.
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Balances with banks
In current accounts 566 237
In term deposit accounts with maturity less than 3 months at inception 4,908 344
Cheques on hand 100 -
Cash on hand 7 1
Total 5,581 582
16. (b) Bank balances other than cash and cash equivalents
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Earmarked balances In current account 29 26
Balance with banks
In term deposit accounts
with maturity more than 3 months but less than 12 months at inception 285 146
with maturity more than 12 months at inception 150 20
In margin money 142 289
Total 606 481
Earmarked bank balance are restricted in use and it relates to unclaimed dividend and balance with banks held as margin money for
security against the guarantee.
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Forward contracts 250 84
Commodity contracts 50 9
Commodity options @ -
Interest rate swaps 20 37
Currency options 1 21
Total 321 151
@ - Less than ` 0.50 crores
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
As at As at As at As at
Particulars 31 March 2019 31 March 2018 31 March 2019 31 March 2018
Number of shares Amount (` in crores)
Share Capital
(a) Authorised
Equity shares of the par value of Re. 1 each 60,15,00,00,000 60,15,00,00,000 6,015 6,015
(b) Issued and subscribed
(i) Outstanding at the beginning of the year fully paid up 2,41,72,20,440 2,41,72,20,440 242 242
(ii) Less: Treasury shares held under ESOP trust (1,55,08,976) (1,09,88,860) (2) (1)
(refer note a below)
(iii) Outstanding at the end of the year fully paid up 2,40,17,11,464 2,40,62,31,580 240 241
(c) Equity shares forfeited (amount originally paid-up) 61 61
Total 301 302
ESOP is the primary arrangement under which shared plan service incentives are provided to certain specified employees
of the company and it’s subsidiaries in India. For the purpose of the scheme, the Company purchases shares from the open market
under ESOP trust. The Company treats ESOP trust as its extension and shares held by ESOP trust are treated as treasury shares.
For the details of shares reserved for issue under the Employee Stock Ownership Plan (ESOP) of the Company (refer note 38).
C) Shareholders Holding More than 5% Share in the Company are set out Below
As at 31 March 2019 As at 31 March 2018
Particulars
No of shares % of shares No of shares % of shares
Equity shares
JFE Steel International Europe BV 36,25,83,070 15.00% 36,25,83,070 15.00%
JSW Holdings Limited 17,88,37,230 7.40% 17,73,06,230 7.34%
Vividh Finvest Private Limited (formerly known as Vividh Consultancy 14,19,95,690 5.87% 14,07,26,690 5.82%
and Advisory Services Private Limited)
JSW Techno Projects Management Limited 24,73,28,450 10.23% 22,93,26,950 9.49%
D) Shares Alloted as Fully Paid-Up Pursuant to Contracts Without Payment being Received in Cash During the
Period of Five Years Immediately Preceding the Date of the Balance Sheet
NIL
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
General reserve 9,899 10,281
Retained earnings 13,736 7,528
Other comprehensive income
Equity instruments through other comprehensive income 476 478
Effective portion of cash flow hedges 66 10
Foreign currency translation reserve (552) (518)
Foreign currency monetary item translation difference account (57) (25)
Other reserves
Equity settled share based payment reserve 91 41
Capital reserve 3,585 3,585
Capital redemption reserve 531 149
Capital reserve on bargain purchase 1,017 609
Securities premium reserve 5,417 5,417
Debenture redemption reserve 285 141
Total 34,494 27,696
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The share based payment reserve is used to recognise the provisions of the Companies Act 2013. This reserve
value of equity settled share based payments provided as is utilised in accordance with the specific provisions
part of the ESOP scheme. of the Companies Act 2013.
20. Borrowings
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars
Non-current Current Non-current Current
Bonds (unsecured) 3,459 3,459 6,504 -
Debentures (secured) 2,300 1,841 4,141 563
Term loans:
Secured 12,474 2,760 12,905 2,815
Unsecured 9,790 2,905 6,475 1,570
Deferred government loans (unsecured) 88 33 77 21
Other loans:
Finance lease obligations (unsecured) 1,697 260 1,560 221
Preference shares (unsecured) 20 231 208 383
Unamortised upfront fees on borrowing (172) (82) (147) (80)
Total 29,656 11,407 31,723 5,493
Less: Current maturities of long-term debt clubbed under other - (11,407) - (5,493)
financial liabilities (current) (refer note 28)
Total 29,656 - 31,723 -
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
22. Provisions
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars
Non-current Current Non-current Current
Provision for employee benefits
Provision for compensated absences (refer note 41) 98 36 87 33
Provision for gratuity (refer note 41) 134 84 36 139
Provision for provident fund (refer note 41) - 1 - -
Other provisions
Provision for contingency 2 - 2 -
Mine closure provision 18 - 12 -
Others 6 13 1 12
Total 258 134 138 184
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Provision for contingency
Balance at the beginning of the year 2 2
Utilization during the year - -
Balance at the end of the year 2 2
Mine closure provision *
Balance at the beginning of the year 12 9
Created during the year - 3
Movement on account of exchange rate variation 6 -
Balance at the end of the year 18 12
Others
Balance at the beginning of the year 13 13
Movement during the year 6 -
Balance at the end of the year 19 13
* S
ite restoration expenditure is incurred on an ongoing basis until the closure of the site. The actual expenses may vary based on the nature of restoration and the estimate
of restoration expenditure.
Statutory income taxes are assessed based on book profits prepared under generally accepted accounting principles in India
adjusted in accordance with the provisions of the (Indian) Income Tax Act, 1961. Such adjustments generally relate to depreciation
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
of fixed assets, disallowances of certain provisions and accruals, deduction for tax holidays, the set-off of tax losses and
depreciation carried forward and retirement benefit costs. Statutory income tax is charged at 30% plus a surcharge and education
cess. MAT is assessed on book profits adjusted for certain items as compared to the adjustments followed for assessing regular
income tax under normal provisions. MAT for the fiscal year 2018-19 is 21.549%. MAT paid in excess of regular income tax during
a year can be set off against regular income taxes within a period of fifteen years succeeding the fiscal year in which MAT credit
arises subject to the limits prescribed.
Business loss can be carried forward for a maximum period of eight assessment years immediately succeeding the assessment
year to which the loss pertains. Unabsorbed depreciation can be carried forward for an indefinite period.
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Current tax
Current tax 2,473 1,846
Tax refund/reversal pertaining to earlier years - (20)
Total 2,473 1,826
Deferred tax
Deferred tax 1,325 1,348
MAT credit entitlement (154) (1,656)
(Restoration)/Reversal of MAT credit entitlement - 20
Total 1,171 (288)
A reconciliation of income tax expense applicable to accounting profit before tax at the statutory income tax rate to recognised
income tax expense for the year indicated are as follows:
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Profit before tax 11,168 7,651
Enacted tax rate in India 34.944% 34.608%
Expected income tax expense at statutory tax rate 3,903 2,648
Expenses not deductible in determining taxable profits 38 175
Income exempt from taxation / taxable separately (314) (232)
Tax holiday allowances (371) (9)
Effect of different tax rates of subsidiaries 191 120
Deferred tax assets not recognised 250 76
Dividend distribution tax (46) 46
Effect of recognition of deferred tax assets on unused tax losses (refer note b below) - (729)
Effect on opening deferred taxes resulting from tax rate changes (refer note c below) - (572)
Others (7) 15
Total 3,644 1,538
Effective tax rate 32.63% 20.11%
a) There are certain income-tax related legal proceedings which are pending against the Group. Potential liabilities, if any have
been adequately provided for, and the Group does not currently estimate any probable material incremental tax liabilities in
respect of these matters (refer note 44).
b) In view of the improving operational performance of components based in the United States of America (USA), the Group
during the previous year ended 31 March 2018 had recognised a deferred tax asset amount to ` 729 crores on the unused
tax losses to the extent the components had sufficient taxable temporary differences.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
c) Pursuant to the enactment of Tax Cuts and Jobs Act by the USA on 22 December 2017, the corporate income tax rate for
components of Group based in USA was reduced to 21% resulting in a reversal of deferred tax liabilities amounting to ` 572
crores during the previous year ended 31 March 2018.
The following is the analysis of deferred tax assets / (liabilities) balances presented in the balance sheet:
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Deferred tax liabilities (3,894) (2,604)
Deferred tax assets 117 48
Total (3,777) (2,556)
Significant component of deferred tax assets / (liabilities) and movement during the year are as under:
` in crores
` in crores
The Group offsets deferred tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and
current tax liabilities and relates to income taxes levied by the same tax authority.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Deferred tax assets on carry forward business loss/ unabsorbed depreciation have been recognised to the extent of deferred
tax liabilities on taxable temporary differences available. It is expected that any reversals of the deferred tax liability would be
offset against the reversal of the deferred tax asset at respective entities. However, in case of certain subsidiaries, deferred tax
assets of `87 crores has been recognized based on the expected reasonable certainty of utilization of tax losses against future
taxable profits.
The deferred tax liabilities on temporary differences associated with investment in subsidiaries which have not been recognised
aggregate to ` 278 crores (31 March 2018: ` 216 crores), where the Group is able to control the reversal of the temporary difference
and it is probable that the temporary difference will not reverse in the foreseeable future.
The Group expects to utilize the MAT credit within a period of 15 years.
Expiry schedule of losses on which deferred tax assets is not recognised is as under:
` in crores
Expiry of losses Beyond
2019-20 2020-21 2021-22 2022-23 2023-24 Indefinite Total
(as per local tax laws) 5 years
I. Business losses 74 80 81 88 112 254 2,361 3,050
II. Unabsorbed depreciation - - - - - - 60 60
III. Long term capital losses - - 203 3 - - - 206
IV. Short term capital losses - - - @ - - - @
Total 74 80 284 91 112 254 2,421 3,316
@ - Less than ` 0.50 crores
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Advance from customer # 4,079 -
Share warrants 14 14
Export obligation deferred income* 117 101
Other payables 11 21
Total 4,221 136
# A
dvance from customer includes the amount relating to a five year Advance Payment and Supply Agreement (“APSA”) agreement with Duferco S.A. for supply of steel products.
Duferco S.A. has provided an interest bearing advance amount of USD 700 million under this agreement. The advance and interest will be adjusted by export of steel products
to Duferco S.A. . Current portion of ` 763 crores has been included in Note 29.
* Represents government assistance in the form of the duty benefit availed under Export Promotion Capital Goods (EPCG) Scheme and Special Economic Zone (SEZ) scheme
on purchase of property, plant and equipment accounted for as government grant and being amortised over the useful life of such assets.
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Loan repayable on demand
Working capital loans from banks (secured)
Rupee loans 734 162
Foreign currency loans 958 96
Packing Credit in Foreign Currency loan from bank (unsecured) - 662
Export Packing Credit in Rupee from banks (unsecured) 69 24
Commercial papers (unsecured) 4,572 1,233
Total 6,333 2,177
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Working capital loans of ` 1,692 crores (31 March 2018 – ` 258 crores) are secured by:
i) pari passu first charge by way of hypothecation of stocks of raw materials, finished goods, work-in-process, consumables (stores
and spares) and book debts / receivables of the Company and the respective subsidiary, both present and future.
ii) pari passu second charge on movable properties and immovable properties forming part of the property, plant and equipment
of the Company and the respective subsidiary, both present and future except such properties as may be specifically excluded.
Disclosure pertaining to micro, small and medium enterprises (as per information available with the Company):
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Principal amount due outstanding as at end of year 39 23
Interest due on (1) above and unpaid as at end of year - @
Interest paid to the supplier - -
Payments made to the supplier beyond the appointed day during the year - -
Interest due and payable for the year of delay - -
Interest accrued and remaining unpaid as at end of year 1 1
Amount of further interest remaining due and payable in succeeding year 1 2
@ - less than ` 0.50 crores
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
(b) Total outstanding, dues of creditors other than micro and small enterprises
Acceptances 10,228 9,033
Other than acceptances 5,892 6,888
Total 16,120 15,921
Acceptances include credit availed by the Group from banks for payment to suppliers for raw materials purchased by the Group.
The arrangements are interest-bearing and are payable within one year.
Other than acceptances payables are normally settled within 180 days.
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Forward contract 322 45
Commodity contract 30 45
Interest rate swaps 27 5
Currency options @ 1
Total 379 96
@ - less than ` 0.50 crores
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Current maturities of long term borrowings (refer note 20) 11,147 5,272
Current maturities of finance lease obligations (refer note 20) 260 221
Current dues of other financial liabilities (refer note 21) 730 476
Payables for capital projects
Acceptances 1,332 716
Other than acceptances 1,832 633
Interest accrued but not due on borrowings 451 431
Payables to employees 183 152
Unclaimed matured debentures and accrued interest thereon @ @
Unclaimed dividends 26 23
Unclaimed amount of sale proceeds of fractional shares 3 3
Others 867 688
Total 16,831 8,615
@ - less than ` 0.50 crores
Acceptance includes credit availed by the group from banks for payment to suppliers for capital items. The arrangements are
interest-bearing and are payable within one year.
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Advances from customers 1,154 370
Statutory liabilities 634 1,012
Export obligation deferred income 154 167
Others 34 15
Total 1,976 1,564
Advance from customer includes current portion ` 763 crores relating to APSA. Refer note 24.
Export obligation deferred income represents government assistance in the form of the duty benefit availed under Export Promotion
Capital Goods (EPCG) Scheme and Special Economic Zone (SEZ) scheme on purchase of property, plant and equipment accounted for
as government grant and being amortised over the useful life of such assets.
` in crores
For the year ended For the year ended
Particularws
31 March 2019 31 March 2018
Sale of products (including shipping services) (a) 82,499 71,349
Other operating revenues
Government grant income
GST Incentive income (refer note (a) below) 1,174 1,089
Export obligation deferred income amortization 165 68
Export benefits and entitlements income 374 450
Unclaimed liabilities written back 263 127
Miscellaneous income 282 128
Total (b) 2,258 1,862
Total (a+b) 84,757 73,211
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Notes:
a) Incentives under the State Industrial Policy
The Company units at Dolvi in Maharashtra and Vijayanagar in Karnataka are eligible for incentives under the respective State
Industrial Policy and have been availing incentives in the form of VAT deferral / CST refunds historically. The Company currently
recognises income for such government grants, on the basis using State Goods & Service Tax rates instead of VAT rates, in
accordance with the relevant notifications issued by the State of Maharashtra and the State of Karnataka post implementation of
Goods & Services Tax (GST).
The State Government of Karnataka vide its circular dated 26 February 2019, has issued guidelines for determining the eligible
incentive amount under the GST regime.
The State Government of Maharashtra (‘GOM’) vide its Government Resolution (GR) dated 20 December 2018 issued the modalities
for sanction and disbursement of incentives, under GST regime, and introduced certain new conditions / restrictions for accruing
incentive benefits granted to the Company including denying incentives on related party transactions and certain other restrictions.
Subsequently, the GOM issued a corrigendum dated 8 March 2019 to the above mentioned GR allowing eligible units to claim
incentives on related party transactions.
The management has evaluated the impact of other conditions imposed and has obtained legal advice on the tenability of these
changes in the said scheme. Based on such legal advice, the Company has made the representation to GOM and believes that said
Incentives would continue to be made available to the Company under the GST regime, since the new conditions are not tenable
legally and will contest these changes appropriately.
Accordingly, the Company has recognized grant income without giving effect to the above restrictions amounting to ` 161 crores
for the year ended 31 March 2019 (previous year ` 110 crores). The cumulative amount receivable towards the same as at 31
March 2019 amounting to ` 271 crores have been considered as good and recoverable.
However, the Group has determined that, in case of certain contracts, shipping services provided to customers is a separate
performance obligation and accordingly, the revenue attributable to such shipping services has been recognised as revenue
from operations, which was hitherto netted off against the corresponding freight expense included in the other expenses in the
Statement of Profit and Loss. The Group has applied full retrospective approach and restated the previous period presented.
The restated revenue for the year ended 31 March 2018 is higher by ` 1,708 crores with the corresponding increase in Other expenses.
The restated revenue and restated other expenses for the year ended 31 March 2018 are:
` in crores
For the year ended
Particulars
31 March 2018
Revenue from operations 73,211
Other expenses 16,271
Further, the export benefits amounting to ` 450 crores for the year ended 31 March 2018 which was earlier included as part of
Revenue from sale of products has been reclassified to Other operating revenue.
The above adjustments have no impact on the balance sheet and cash flow statement for the previous period.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The Group has assessed and determined the following categories for disaggregation of revenue in addition to that provided under
segment disclosure (refer note 40):
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Revenue from contracts with customer - Sale of products (including shipping services) 82,499 71,349
Other operating revenue 2,258 1,862
Total revenue from operations 84,757 73,211
India 69,085 55,700
Outside India 15,672 17,511
Total revenue from operations 84,757 73,211
Timing of revenue recognition
At a point in time 84,757 73,211
Total revenue from operations 84,757 73,211
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
MS slabs 1,274 1,164
Hot rolled coils/steel plates/sheets * 31,339 25,909
Galvanised coils/sheets 9,080 8,547
Color Coated Galvanised coils/sheets 4,432 3,820
Cold rolled coils/sheets 10,774 9,908
Steel billets & blooms 1,728 1,780
Long rolled products 16,222 13,929
Plates and pipes 2,918 1,507
Others 4,732 4,785
Total 82,499 71,349
* Includes Hot rolled coils converted into SAW Pipes on Jobwork basis – Sales – NIL tonnes (previous year: 89,820 tonnes) Value – ` NIL (previous year: `429 crores)
Contract Balances
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Trade Receivables (Gross) (refer note 15) 7,160 4,704
Contract liabilities
Advance from customers (refer note 24 and 29) 5,233 370
The credit period on sales of goods ranges from 7 to 60 days with or without security.
The acquisition of a subsidiary resulted in increase in trade receivables of ` 634 crores in FY 2018-19 (previous year: ` Nil).
As at 31 March 2019, ` 106 crores (previous year: ` 96 crores) was recognised as provision for allowance for doubtful debts on
trade receivables.
Contract liabilities include long term and short term advances received for sale of goods. The outstanding balances of these
accounts increased in due to the continuous increase in the customer base. Long term advances is detailed in note 24.
Amount of revenue recognized from amounts included in the contract liabilities at the beginning of the year ` 370 crores (previous
year: ` 377 crores) and performance obligations satisfied in previous years is ` Nil (previous year: ` Nil).
Out of total contract liabilities outstanding as on 31 March 2019, ` 1,154 crores will be recognized by 31 March 2020, and
remaining thereafter.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Refund liabilities
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Arising from volume rebates and discount 663 545
(included in Other financial liabilities - Note 28)
The Group does not have any significant adjustments between the contracted price and revenue recognized in the consolidated
statement of profit and loss.
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Interest income earned on financial assets that are not designated as FVTPL
Loans to related parties 20 2
Bank deposits 21 47
Others 93 70
Dividend income from non-current investments designated as FVTOCI - 5
Gain on sale of current investments designated as FVTPL 19 19
Fair value gain on financial instruments designated as FVTPL 6 2
Unwinding of interest on financial assets carried at amortised cost 25 1
Miscellaneous income (insurance claim received, rent income etc.) 20 21
Total 204 167
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Opening stock:
Semi-finished /finished goods/stock-in-trade 3,700 4,499
Work-in-progress 773 775
A 4,473 5,274
Acquired pursuant to business combination (refer note 39):
Semi-finished /finished goods/stock-in-trade 84 -
B 84 -
Closing stock:
Semi-finished /finished goods/stock-in-trade 4,564 3,700
Work-in-progress 583 773
C 5,147 4,473
D = (A+B-C) (590) 801
Excise duty on stock of finished goods (net) E - (557)
Total F = (D+E) (590) 244
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Salaries, wages and bonus 2,053 1,587
Contribution to provident and other funds (refer note 41) 186 91
Gratuity expense 10 6
Expense on employees stock ownership plan 48 27
Staff welfare expenses 192 132
Total 2,489 1,843
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Interest expense
on bonds and debentures 893 837
Others 2,406 2,363
Dividend on redeemable preference shares 41 72
Interest on finance lease obligations 220 214
Unwinding of interest on financial liabilities carried at amortised cost 21 14
Exchange differences regarded as an adjustment to borrowing costs 143 22
Other borrowing costs 188 156
Interest on income tax 5 23
Total 3,917 3,701
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Depreciation of property, plant and equipment 4,012 3,358
Amortisation of intangible assets 29 29
Total 4,041 3,387
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Stores and spares consumed 4,109 3,033
Power and fuel 7,053 5,697
Royalty / Premium on captive mines 272 -
Rent 81 56
Repairs and maintenance
Plant and equipment 1,124 941
Buildings 44 33
Others 37 57
Insurance 107 81
Rates and taxes 90 70
Carriage and freight 4,015 3,880
Jobwork and processing charges 829 769
Commission on sales 51 70
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Net loss / (gain) on foreign currency transactions and translation # 554 56
Donations and contributions 33 3
Fair value loss on financial instruments designated as FVTPL 1 111
Miscellaneous expenses 1,550 1,156
Allowance for doubtful debts and advances 152 136
Loss on sale of property, plant and equipment (net) 8 122
Total 20,110 16,271
# including hedging cost of ` 470 crores (previous year ` 250 crores).
The number of options granted to each eligible employee is determined by dividing the Award Value (amount equivalent to
percentage of Annual Fix Pay) by the Fair Value of option provided. The Fair Value of option on the date of each grant is determined
by using Black Scholes model.
ESOP 2016 is the primary arrangement under which shared plan service incentives are provided to certain specified employees
of the company and it’s subsidiaries in India.
Three grants have been made under ESOP plan 2016 to eligible employees on the rolls of the company as at 1 April, 2016, 1 April,
2017 and 1 April, 2018.
The maximum value and share options that can be awarded to eligible employees is calculated by reference to certain percentage
of individuals fixed salary compensation. 50% of the grant would vest at the end of the third year and 50% of the grant would vest
at the end of the fourth year with a vesting condition that the employee is in continuous employment with the company till the
date of vesting.
The exercise price would be determined by the ESOP committee as a certain discount to the primary market price on the date of grant.
A total of 28,687,000 options would be available for grant to the eligible employees of the Company and a total of 3,163,000 options
would be available for grant to the eligible employees of the Indian subsidiaries of the Company under the ESOP Plan.
These options are equity settled and are accounted for in accordance with the requirement applying to equity settled transactions.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The details of an employee share based payments plan operated through a trust for ESOP 2016 are as follows:
ESOP 2016
Particulars
1st grant (L-16 and above Grade) 2nd grant (L-16 and above Grade) 3rd grant (L-16 and above Grade)
Date of grant 17 May 2016 16 May 2017 14 May 2018
Share Price on date of grant 129.56 201.70 329.05
Outstanding as on 1 April 2017 7,212,200 - -
Granted during the year - 5,118,977 -
Transfer in 283,280 163,812 -
Transfer out 596,700 301,513 -
Forfeited \ lapsed during the year 126,640 70,405 -
Exercised during the year - - -
Outstanding as on 31 March 2018 6,772,140 4,910,871 -
Granted during the year - - 3,388,444
Transfer in - - -
Transfer out 371,390 192,383 13,027
Forfeited \ lapsed during the year 23,640 - -
Exercised during the year - - -
Outstanding as on 31 March 2019 6,377,110 4,718,488 3,375,417
of above - vested outstanding options 3,188,555 - -
of above - unvested outstanding options 3,188,555 4,718,488 3,375,417
Vesting Period 17 May 2016 till 31 March 2019 (for 16 May 2017 till 31 March 2020 for 14 May 2018 till 31st March, 2021
50% of the grant) and 17 May 2016 50% of the options granted and for 50% of the options granted
to 31 March 2020 (for remaining upto 31 March 2021 for remaining and upto 31st March, 2022 for
50% of the grant) 50% of the options granted remaining 50% of the options
granted
Exercise period 4 years from vesting date
Weighted average remaining contract life 54 months 66 months 78 months
Exercise Price 103.65 161.36 263.24
Weighted average share price Not Applicable Not Applicable Not Applicable
on exercise date
A description of the method and The fair value of options has been The fair value of options has been The fair value of options has been
significant assumptions used during the calculated by using Black Scholes calculated by using Black Scholes calculated by using Black Scholes
year to estimate the fair value of options Method. The assumptions used in Method. The assumptions used in Method. The assumptions used in
including the following information: the above are: the above are: the above are:
Weighted-average values of share price Not applicable Not applicable Not applicable
Weighted-average exercise prices Not applicable Not applicable Not applicable
Expected volatility Volatility was calculated using Volatility was calculated using Volatility was calculated using
standard deviation of daily change standard deviation of daily change standard deviation of daily change
in stock price. in stock price. in stock price.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
ESOP 2016
Particulars
1st grant (L-16 and above Grade) 2nd grant (L-16 and above Grade) 3rd grant (L-16 and above Grade)
The volatility used for valuation The volatility used for valuation The volatility used for valuation
is 39.23 % for options with 3 year is 39.76 % for options with 3 year is 33.23 % for options with 3 year
vesting and 39.62 % with 4 years vesting and 37.43 % with 4 years vesting and 33.28% with 4 years
vesting vesting vesting
Expected option life The expected option life is The expected option life is The expected option life is
assumed to be midway between assumed to be mid-way between assumed to be mid way between
the option vesting and expiry. the option vesting and expiry. the option vesting and expiry.
Since the vesting period and Since the vesting period and Since the vesting period and
contractual term of each tranche contractual term of each tranche contractual term of each tranche
is different, the expected life for is different, the expected life for is different, the expected life for
each tranche will be different. The each tranche will be different. The each tranche will be different. The
expected option life is calculated expected option life is calculated expected option life is calculated
as (Year to Vesting + Contractual as (Year to Vesting + Contractual as (Year to Vesting + Contractual
Option Term)/2 Option Term)/2 Option Term)/2
Expected dividends `1.10 per share `0.75 per share `2.25 per share
Risk-free interest rate Zero coupon sovereign bond yields Zero coupon sovereign bond yields Zero coupon sovereign bond yields
were utilized with maturity equal to were utilized with maturity equal to were utilized with maturity equal to
expected term of the option expected term of the option expected term of the option
The rate used for calculation is The rate used for calculation is The rate used for calculation is
7.36% (for 3 years vesting) & 6.87% (for 3 years vesting) & 7.85% for options with 3 year
7.44%(for 4 years vesting) 6.96%(for 4 years vesting) vesting and 7.92% for options with
4 years vesting
The method used and the assumptions Black-Scholes Options pricing model
made to incorporate the effects of
expected early exercise;
How expected volatility was determined, The following factors have been considered:
including an explanation of the extent to a) Share price
which expected volatility was based on b) Exercise prices
historical volatility; and c) Historical volatility
d) Expected option life
e) Dividend Yield
Whether and how any other features of
the option grant were incorporated into
the measurement of fair value, such as a
market condition.
As per Ind AS 103 on Business Combination, purchase consideration has been allocated basis the fair value of the acquired assets
and liabilities and the resulting differential has been accounted as goodwill. The financial statements include the results of Acero
for the period from 15 June 2018 to 31 March 2019.
Details of the purchase consideration, net assets acquired and goodwill are as follows:
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The Group has recognised a goodwill of `90 crores basis the purchase price allocation carried out by independent valuation expert.
The indemnification asset is primarily related to guarantee provided by seller in relation to certain liability that may accrue to
Company in future.
At the date of the acquisition, the fair value of the trade receivables approximated their gross contractual amount.
The goodwill recognised is primarily attributable to the expected synergies and other benefits from integrating Acero into the
Group’s existing steel business.
From the date of acquisition, Acero has contributed ` 628 crores of revenue and net loss after tax of ` 323 crores.
Transaction costs of ` 3 crores have been expensed and are included in “Other expenses” in the statement of profit and loss and
are a part of operating cash flows in the statement of cash flows.
b) On 24 July 2018, the Company through its wholly owned subsidiary in Italy, JSW Steel Italy S.r.l, completed acquisition of 100%
shares each of Aferpi S.p.A (“Aferpi”) and Piombino Logistics S.p.A (“PL”) and 69.27% of the shares of GSI Lucchini S.p.A (“GSI”)
(collectively referred to as “Targets”) for a consideration of ` 489 crores (Euro 60.70 million) towards acquisition of equity shares
and ` 100 crores (Euro 12.38 million) towards acquisition of loans provided by the erstwhile shareholders of the Targets.
Aferpi produces and distributes special long steel products viz rails, wire rods and bars. It has a plant at Piombino in Italy, comprising
a Rail Mill (0.32 mtpa), Bar Mill (0.4 mtpa), Wire Rod Mill (0.6 mtpa) and a captive industrial port concession. PL manages the logistic
infrastructure of Piombino’s port area. GSI is a producer of forged steel balls used in grinding mills with predominant application in
mining processing.
As per Ind AS 103, purchase consideration has been allocated to the fair value of the acquired assets and liabilities and the
resulting differential has been accounted as capital reserve. The financial statements include the results of Targets for the period
from the acquisition date to 31 March 2019.
Details of the purchase consideration, net assets acquired and capital reserve are as follows:
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The Company has recognised a capital reserve of ` 178 crores, basis the purchase price allocation carried out by independent
valuation expert. Since the Target was not an integrated steel plant, it was dependent on external market for essential raw
materials. Accordingly, there were few prospective buyers for these entities. The Company being an integrated steel plant had
the facilities to meet these raw material requirements and derive synergies of operation. The Company was, therefore, able to
negotiate a reasonable acquisition price with the erstwhile shareholders which is primarily the reason for recognition of capital
reserve on acquisition.
The non-controlling interest in GSI recognised at the acquisition date was measured by reference the fair value of the non-controlling
interest and amounted to ` 59 crores (Euro 7.38 million). This fair value was estimated by applying a market approach and an
income approach using an assumed discount rate of 9.7% and other factors like estimated long term growth rate, lack of control
and marketability, etc.
At the date of the acquisition, the fair value of the trade receivables approximated their gross contractual amount.
From the date of acquisition, Targets have contributed ` 1,028 crores of revenue and net loss after tax ` 139 crores.
Transaction costs of ` 9 crores have been expensed and are included in “Other expenses” in the statement of profit or loss and are
part of operating cash flows in the statement of cash flows.
If both the acquisition had taken place at the beginning of the period, management estimates that consolidated revenue from
operation and profit for the combined entity would be ` 82,735 crores and ` 7,364 crores respectively. In determining these
amounts, management has assumed that the fair value adjustments, that arose on the date of acquisition would have been the
same if the acquisition had occurred on 1 April 2018.
c) Pursuant to the Corporate Insolvency Resolution process for Monnet Ispat & Energy Limited (“MIEL”) under the Insolvency
Bankruptcy Code, 2016 initiated on 18 July 2017, the National Company Law Tribunal (‘NCLT’) on 24 July 2018 (Order date) approved
(with modifications) the resolution plan submitted by the consortium of JSW Steel Limited and AION Investments Private II Limited.
The consortium completed the acquisition of MIEL through their jointly controlled entity Creixent Special Steels Limited (“CSSL”) on
31 August 2018. MIEL has steel plants in the state of Chhattisgarh with Blast furnace and DRI facility of 1.5 MTPA. The Company has
an effective shareholding of 23.1% in MIEL and has accounted this acquisition under equity method which resulted in recognizing
a capital reserve of ` 230 crores.
The impact of the Resolution Plan has been given effect to on the acquisition date and the transaction has been accounted under
Ind AS 28. Therefore, the statement of profit and loss for the current year include MIEL w.e.f 31 August 2018 and are not comparable
with previous year.
d) The Resolution Plan submitted by the Company for Vardhman Industries Limited (VIL) was approved with some modifications,
by the Hon’ble National Company Law Tribunal (NCLT) New Delhi, by its order dated 16 April 2019. The Company filed an appeal
challenging the said NCLT Order before National Company Law Appellate Tribunal (NCLAT), in which an interim order was passed on
30 April 2019 suggesting that the Resolution Plan as approved by the Committee of Creditors may be implemented subject to the
decision of the appeal. The Company further filed an Appeal before the Hon’ble Supreme Court against the interim order of NCLAT
in which the Hon’ble Supreme Court vide an order dated 10 May 2019 has ordered status quo and the matter is posted for hearing
before the NCLAT on 28 May 2019.
e) On 23 October 2018, the Company has acquired an additional stake of 60.004% of the share capital of Dolvi Minerals and Metals
Private Limited (“DMMPL”), a subsidiary, for a cash consideration of `109 crores. Pursuant to the acquisition of shares of DMMPL,
DMMPL along with its wholly owned subsidiary Dolvi Coke Projects Limited, have become wholly owned subsidiaries of the Company.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
b) Non-current assets
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars
Within India Outside India Total Within India Outside India Total
(a) Property, plant and equipment 55,051 6,553 61,604 52,558 4,496 57,054
(b) Capital work-in-progress 11,363 177 11,540 5,611 18 5,629
(c) Goodwill 28 812 840 28 679 707
(d) Other intangible assets 176 24 200 71 16 87
(e) Intangible assets under development 344 5 349 321 - 321
(f) Investment in joint ventures 424 204 628 190 170 360
(g) Other non-current assets 3,557 368 3,925 2,811 70 2,881
(h) Current tax assets (net) 240 - 240 271 - 271
(i) Financial assets 1,916 1,468
(j) Deferred tax assets (net) 117 48
Total non-current assets 81,359 68,826
Non-current assets have been allocated on the basis of their physical location.
Group’s contribution to provident fund and 401 (K) plan recognized in the Consolidated Statement of Profit and Loss is ` 62
crores (previous year: ` 59 crores) (included in note 33).
The gratuity plan is covered by The Payment of Gratuity Act, 1972. Under the gratuity plan, the eligible employees are entitled
to post-retirement benefit at the rate of 15 days salary for each year of service until the retirement age of 58, 60 and 62,
without any payment ceiling. The vesting period for gratuity as payable under The Payment of Gratuity Act, 1972 is 5 years.
Under the Compensated absences plan, leave encashment is payable to all eligible employees on separation
from the Company due to death, retirement, superannuation or resignation. At the rate of daily salary, as per current
accumulation of leave days.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The plans in India typically expose the Group to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.
Investment risk The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to
government bond yields; if the return on plan asset is below this rate, it will create a plan deficit. Currently the plan has a
relatively balanced investment in equity securities and debt instruments.
Interest risk A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the
return on the plan’s debt investments.
Longevity risk The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan
participants both during and after their employment. An increase in the life expectancy of the plan participants will increase
the plan’s liability.
Salary risk The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As
such, an increase in the salary of the plan participants will increase the plan’s liability.
The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at 31
March 2019 by independent qualified actuaries. The present value of the defined benefit obligation, and the related current service
cost and past service cost, were measured using the projected unit credit method.
(i) Gratuity
` in crores
For the year ended 31 March 2019 For the year ended 31 March 2018
Particulars
Funded Unfunded Funded Unfunded
a) Liability recognized in the Balance Sheet
i) Present value of obligation
Opening balance 265 5 239 4
Service cost 16 @ 16 @
Interest cost 21 @ 18 @
Actuarial loss / (gain) on obligation 17 2 5 @
Benefits paid (14) - (11) @
Experience adjustments 3 - - -
Liability In 2 - @ @
Liability transfer (2) - (2) (1)
Closing balance 308 7 265 5
Less:
ii) Fair value of plan assets
Opening balance 95 - 80 -
Expected return on plan assets less loss on investments 7 - 6 -
Actuarial (loss)/gain on plan assets @ - @ -
Employers' contribution 5 - 18 -
Benefits paid (10) - (9) -
Closing balance 97 - 95 -
Amount recognized in Balance Sheet* 211 7 170 5
*includes ` 0.10 crores (as at 31 March 2018 ` 0.06 crores) being
excess of fair value of plan assets over present value of obligation
disclosed under other current assets (Note-11)
b) Expenses during the year
Service cost 16 @ 16 @
Interest cost 21 @ 18 @
Expected return on plan assets (7) - (6) -
Transferred to preoperative expenses (2) - - -
Component of defined benefit cost recognized in statement of profit 28 @ 28 1
& loss (a)
Remeasurement of net defined benefit liability
- Actuarial (gain)/loss on defined benefit obligation 17 2 5 @
Component of defined benefit cost recognized in other comprehen- 17 2 5 @
sive income (b)
Total (a+b) 45 2 33 1
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
For the year ended 31 March 2019 For the year ended 31 March 2018
Particulars
Funded Unfunded Funded Unfunded
c) Actual return on plan assets 7 - 6 -
The fair values of the above equity and debt instruments are determined based on quoted market prices in active markets
Particulars
Discount rate 7.54%-7.83% 7.76%-7.88% 7.51%-7.85% 7.56%-7.88%
Expected return on plan assets 7.54%-7.83% - 7.51%-7.85% -
Expected rate of increase in salaries 6.00% 6.00% 6.00% 6.00%
Attrition rate 2.00% 2.00% 2.00% 2.00%
Based on India’s standards mortality table with modifications to reflect expected changes in mortality.
f) Experience adjustments
` in crores
Particulars 2018-19 2017-18 2016-17 2015-16 2014-15
Defined benefit obligation 315 270 243 208 183
Plan assets 97 95 80 77 67
Surplus / (deficit) (218) (175) (163) (131) (116)
Experience adjustments on plan liabilities – loss/(gain) 19 5 20 6 33
Experience adjustments on plan assets – gain/(loss) @ @ @ @ 1
@ - less than ` 0.50 crores
g) The Group expects to contribute ` 84 crores (previous year ` 37 crores) to its gratuity plan for the next year.
h) In assessing the Group’s post retirement liabilities, the Group monitors mortality assumptions and uses up-to-date mortality
tables, the base being the Indian assured lives mortality (2006-08) ultimate.
i) Expected return on plan assets is based on expectation of the average long term rate of return expected on investments of the
fund during the estimated term of the obligations after considering several applicable factors such as the composition of plan
assets, investment strategy, market scenario, etc.
j) The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other
relevant factors, such as supply and demand in the employment market.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
k) The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the
estimated term of the obligations.
The amount included in the financial statements arising from the entity’s obligation in respect of its defined benefit plan is as follows:
` in crores
Particulars As at 31 March 2019 As at 31 March 2018
Defined benefit obligation 315 270
Plan assets 97 95
Net liability arising from defined benefit obligation 218 175
Sensitivity Analysis
Significant actuarial assumptions for the determination of the defined benefit obligation are discount rate, expected salary increase and
mortality. The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumptions
occurring at the end of the reporting period, while holding all other assumptions constant.
` in crores
As at 31 March 2019 As at 31 March 2018
Particulars Increase Decrease Increase Decrease
Discount rate (1% movement) (22) 26 (20) 24
Future salary growth (1% movement) 26 (23) 24 (21)
Attrition rate (1% movement) 3 (4) 3 (3)
The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely
that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.
Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using
the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit
obligation recognized in the balance sheet.
There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.
As at 31 March 2018
Projected benefit payable 22 83 488 593
Each year an Asset-Liability-Matching study is performed in which the consequences of the strategic investment policies are analyzed
in terms of risk and return profiles.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The members of the Provident Fund Trust are entitled to the rate of interest declared by the Central Government under the
Employees Provident Funds and Miscellaneous Provisions Act, 1952. The shortfall, if any, is made good by the Company in the year
in which it arises.
As per Ind AS 19 on “Employee Benefits”, employer established provident fund trusts are treated as defined benefit plans,
since the Company is obliged to meet interest shortfall, if any, with respect to covered employees. According to the defined
benefit obligation of interest rate guarantee on exempted provident fund in respect of employees of the Company as at 31
March 2019 is 8.65%.
Out of the total contribution made for Provident Fund in Defined Contribution Plan, ` 20 crores (previous year ` 17 crores) is made
to the JSW Steel Employees Provident Fund Trust.
The funds of the Trust have been invested under various securities in accordance with the rules prescribed by the Government of India.
The Company has obtained the actuarial valuation of interest rate obligation in respect of Provident Fund and interest rate
guarantee shortfall of ` 1 crores (Previous year - Nil) is recognised in the Statement of Profit and Loss.
Actuarial assumptions made to determine interest rate guarantee on exempt provident fund liabilities are as follows:
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Total plan assets @ 505 453
Total plan liabilities @ 499 435
Discount rate 7.79% 7.85%
Rate of return on assets 8.55% 8.88%
Guaranteed rate of return 8.65% 8.55%
@ JSW Steel Employees Provident Fund Trust as at 31 March 2019 as per the unaudited financial statements.
The Group’s capital requirement is mainly to fund its capacity expansion, repayment of principal and interest on its borrowings and
strategic acquisitions. The principal source of funding of the Group has been, and is expected to continue to be, cash generated
from its operations supplemented by funding from bank borrowings and the capital markets. The Group is not subject to any
externally imposed capital requirements.
The Group regularly considers other financing and refinancing opportunities to diversify its debt profile, reduce interest cost and
elongate the maturity of its debt portfolio, and closely monitors its judicious allocation amongst competing capital expansion
projects and strategic acquisitions, to capture market opportunities at minimum risk.
The Group monitors its capital using gearing ratio, which is net debt divided to total equity. Net debt includes, interest bearing loans
and borrowings less cash and cash equivalents, bank balances other than cash and cash equivalents and current investments.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Long term borrowings 29,656 31,723
Current maturities of long term debt and finance lease obligations 11,407 5,493
Short term borrowings 6,333 2,177
Total borrowings 47,396 39,393
Less:
Cash and cash equivalents 5,581 582
Bank balances other than cash and cash equivalents 606 481
Current investments 82 312
Net debt 41,127 38,018
Total equity 34,345 27,534
Gearing ratio 1.20 1.38
(i) Equity includes capital and all reserves of the Group that are managed as capital.
(ii) Debt is defined as long and short term borrowings (excluding derivatives and financial guarantee contracts), as described in
notes 20 and 25.
As at 31 March 2019
` in crores
Fair value
through other Fair value through Derivatives in Total Carrying
Particulars Amortised cost Fair value
comprehensive profit and loss hedging relations Value
income
Financial assets
Loans 994 - - - 994 994
Other financial assets 2,516 - - - 2,516 2,516
Trade receivables 7,160 - - - 7,160 7,160
Cash and cash equivalents 5,581 - - - 5,581 5,581
Bank balances other than cash 606 - - - 606 606
and cash equivalents
Derivative assets - - 159 162 321 321
Investments 387 756 123 - 1,266 1,268
Total financial assets 17,244 756 282 162 18,444 18,446
Financial liabilities
Long-term borrowings* 41,063 - - - 41,063 41,816
Short-term borrowings 6,333 - - - 6,333 6,333
Trade payables 16,159 - - - 16,159 16,159
Derivative liabilities - - 313 66 379 379
Other financial liabilities 5,956 - - - 5,956 5,929
Total financial liabilities 69,511 - 313 66 69,890 70,616
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
As at 31 March 2018
` in crores
Fair value
through other Fair value through Derivatives in Total Carrying
Particulars Amortised cost Fair value
comprehensive profit and loss hedging relations Value
income
Financial assets
Loans 608 - - - 608 608
Other financial assets 823 - - - 823 823
Trade receivables 4,704 - - - 4,704 4,704
Cash and cash equivalents 582 - - - 582 582
Bank balances other than cash 481 - - - 481 481
and cash equivalents
Derivative assets - - 88 63 151 151
Investments - 758 351 - 1,109 1,109
Total financial assets 7,198 758 439 63 8,458 8,458
Financial liabilities
Long-term borrowings* 37,216 - - - 37,216 37,677
Short-term borrowings 2,177 - - - 2,177 2,177
Trade payables 15,944 - - - 15,944 15,944
Derivative liabilities - - 34 62 96 96
Other financial liabilities 4,041 - - - 4,041 3,987
Total financial liabilities 59,378 - 34 62 59,474 59,881
* including current maturities of long-term borrowings
The risk management policies aims to mitigate the following risks arising from the financial instruments:
- Market risk
- Credit risk and
- Liquidity risk
D. Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in the
market prices. The Group is exposed in the ordinary course of its business to risks related to changes in foreign currency exchange
rates, commodity prices and interest rates.
The Group seeks to minimize the effects of these risks by using derivative financial instruments to hedge risk exposures. The use
of financial derivatives is governed by the Group’s policies approved by the Board of Directors, which provide written principles
on foreign exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments,
and the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by the Management and the
internal auditors on a continuous basis. The Group does not enter into or trade financial instruments, including derivatives for
speculative purposes.
Adverse movements in the exchange rate between the Rupee and any relevant foreign currency result’s in increase in the Group’s
overall debt position in Rupee terms without the Group having incurred additional debt and favourable movements in the exchange
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
rates will conversely result in reduction in the Group’s receivables in foreign currency. In order to hedge exchange rate risk, the
Group has a policy to hedge cash flows up to a specific tenure using forward exchange contracts and hedges. At any point in time,
the Group hedges its estimated foreign currency exposure in respect of forecast sales over the following 6 months. In respect of
imports and other payables, the Company hedges its payables as when the exposure arises. Short term exposures are hedged
progressively based on their maturity. Long term exposures are hedged on a case to case basis.
All hedging activities are carried out in accordance with the Company’s internal risk management policies, as approved by the
Board of Directors, and in accordance with the applicable regulations where the Company operates.
The forward exchange contracts entered into by the Group and outstanding are as under:
US$ Equivalent INR Equivalent MTM
As at Nature No. of Contracts Type
(Millions) (crores) (` in crores)
20 Buy 190 1,311 4
Assets
31 March 2019 63 Sell 653 4,518 200
Liabilities 154 Buy 1,292 8,944 (320)
49 Buy 540 3,521 21
Assets
44 Sell 500 3,248 27
31 March 2018
63 Buy 697 4,531 (25)
Liabilities
34 Sell 379 2,465 (20)
The carrying amount of the Group’s Monetary assets and monetary liabilities at the end of the reporting period are as follows:
As at 31 March 2019
` in crores
Particulars INR USD EURO JPY Others Total
Financial assets
Investments 1,253 - 13 - - 1,266
Trade receivables 5,039 1,461 660 - - 7,160
Cash and cash equivalents 5,451 31 98 - 1 5,581
Bank balances other than cash and 467 139 - - - 606
cash equivalents
Loans 993 1 - - - 994
Derivative assets - 321 @ - - 321
Other financial assets 2,455 25 36 - - 2,516
Total financial assets 15,658 1,978 807 - 1 18,444
Financial liabilities
Borrowings 20,436 14,827 312 414 - 35,989
Trade payables 3,550 11,565 1,011 32 1 16,159
Derivative liabilities 340 39 - - - 379
Other financial liabilities 10,235 5,347 1,323 432 26 17,363
Total financial liabilities 34,561 31,778 2,646 878 27 69,890
@ - less than ` 0.50 crores
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
As at 31 March 2018
` in crores
Particulars INR USD EURO JPY Others Total
Financial assets
Investments 1,109 - - - - 1,109
Trade receivables 4,052 513 139 - - 4,704
Cash and cash equivalents 568 11 2 - 1 582
Bank balances other than cash and 289 192 - - - 481
cash equivalents
Loans 607 1 - - - 608
Derivative assets - 151 - - - 151
Other financial assets 693 127 - - 3 823
Total financial assets 7,318 995 141 - 4 8,458
Financial liabilities
Borrowings 18,475 15,066 110 249 - 33,900
Trade payables 3,963 11,878 47 54 2 15,944
Derivative liabilities - 92 4 - - 96
Other financial liabilities 6,556 2,723 98 143 14 9,534
Total financial liabilities 28,994 29,759 259 446 16 59,474
The year-end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are given below:
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The Group is subject to fluctuations in prices for the purchase of iron ore, coking coal, ferro alloys, zinc, scrap and other raw
material inputs. The Group purchased primarily all of its iron ore and coal requirements in the open market at prevailing price during
the year ended 31 March 2019.
The Group aims to sell the products at prevailing market prices. Similarly, the Group procures key raw materials like iron ore and
coal based on prevailing market rates as the selling prices of steel prices and the prices of input raw materials move in the
same direction.
Commodity hedging is used primarily as a risk management tool to secure the future cash flows in case of volatility by entering
into commodity forward contracts.
Hedging commodity is based on its procurement schedule and price risk. Commodity hedging is undertaken as a risk offsetting
exercise and, depending upon market conditions hedges, may extend beyond the financial year. The Group is presently hedging
maximum up to 25 % of its consumption.
The following table details the Group’s sensitivity to a 5% movement in the input price of iron ore and coking coal net of hedge
accounting impact. The sensitivity analysis includes only 5% change in commodity prices for quantity sold or consumed during the
year, with all other variables held constant. A positive number below indicates an increase in profit or equity where the commodity
prices decrease by 5%. For a 5% reduction in commodity prices, there would be a comparable impact on profit or equity, and the
balances below would be negative.
The commodity forward contracts entered into by the Group and outstanding at the year-end are as under:
Quantity
MTM of
(Iron Ore, Coking US$ Equivalent INR
No. of Commodity Commodity
As at Nature Coal, Zinc - MT) of notional value equivalent
Contracts Name contract
(Brent Crude - Mio (million) (crores)
(` in crores)
Barrels)
1 Brent Crude 45,000 2 17 4
Assets
31 March 2019 12 Iron Ore 375,003 24 165 45
Liabilities 10 Iron Ore 375,003 (26) (179) (30)
Quantity
MTM of
(Iron Ore, Coking US$ Equivalent INR
No. of Commodity Commodity
As at Nature Coal - MT) of notional value equivalent
Contracts Name contract
(Brent Crude - Mio (Millions) (crores)
(` in crores)
Barrels)
5 Brent Crude 168,750 10 68 6
Assets
4 Iron Ore 126,000 8 51 2
31 March 2018
1 Zinc 1,000 3 21 @
Liabilities 44 Iron Ore 1,346,000 92 601 (43)
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
of interest risk in US dollars. The Group has exposure to interest rate risk, arising principally on changes in base lending rate and
LIBOR rates. The Group uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements
for its day to day operations like non-convertible bonds and short term loans. The risk is managed by the Group by maintaining
an appropriate mix between fixed and floating rate borrowings, and by the use of interest rate swap contracts. Hedging activities
are evaluated regularly to align with interest rate views and defined risk appetite, ensuring the most cost-effective hedging
strategies are applied.
The following table provides a break-up of the Group’s fixed and floating rate borrowings:
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Fixed rate borrowings 19,624 17,691
Floating rate borrowings 27,999 21,929
Total borrowings 47,623 39,620
Total borrowings 47,396 39,393
Add: Upfront fees 227 227
Total gross borrowings 47,623 39,620
The sensitivity analyses below have been determined based on the exposure to interest rates for floating rate liabilities, after the
impact of hedge accounting, assuming the amount of the liability outstanding at the year-end was outstanding for the whole year.
If interest rates had been 100 basis points higher / lower and all other variables were being constant, the Group’s profit for the year
ended 31 March 2019 would decrease / increase by ` 248 crores (for the year ended 31 March 2018: decrease / increase by ` 193
crores). This is mainly attributable to the Group’s exposure to interest rates on its variable rate borrowings.
The following table detail the nominal amounts and remaining terms of interest rate swap contracts outstanding at the year-end.
The Group is exposed to credit risk for trade receivables, cash and cash equivalents, investments, other bank balances, loans,
other financial assets, financial guarantees and derivative financial instruments.
Moreover, given the diverse nature of the Group’s business trade receivables are spread over a number of customers with no
significant concentration of credit risk. No single customer accounted for 10% or more of the trade receivables in any of the years
presented. The history of trade receivables shows a negligible provision for bad and doubtful debts. Therefore, the Group does not
expect any material risk on account of non-performance by any of the Group’s counterparties.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
For current investments, counterparty limits are in place to limit the amount of credit exposure to any one counterparty.
This, therefore, results in diversification of credit risk for Group’s mutual fund and bond investments. For derivative and financial
instruments, the Company attempts to limit the credit risk by only dealing with reputable banks and financial institutions.
The carrying value of financial assets represents the maximum credit risk. The maximum exposure to credit risk was
` 18,444 crores as at 31 March 2019 and, ` 8,458 crores as at 31 March 2018, being the total carrying value of trade receivables,
balances with bank, bank deposits, current investments and other financial assets.
In respect of financial guarantees provided by the Group to banks and financial institutions, the maximum exposure which the
Group is exposed to is the maximum amount which the Group would have to pay if the guarantee is called upon. Based on the
expectation at the end of the reporting period, the Group considers that it is more likely than not that such an amount will not be
payable under the guarantees provided.
Receivables are deemed to be past due or impaired with reference to the Group’s normal terms and conditions of business.
These terms and conditions are determined on a case to case basis with reference to the customer’s credit quality and prevailing
market conditions. The Group based on past experiences does not expect any material loss on its receivables and hence no
provision is deemed necessary on account of ECL.
The credit quality of the Group’s is monitored on an ongoing basis and assessed for impairment where indicators of such impairment
exist. The Group uses simplified approach for impairment of financial assets. If credit risk has not increased significantly, 12-month
expected credit loss is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime expected
credit loss is used. The solvency of the debtor and their ability to repay the receivable is considered in assessing receivables for
impairment. Where receivables have been impaired, the Group actively seeks to recover the amounts in question and enforce
compliance with credit terms.
The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities with agreed
repayment periods and its non-derivative financial assets. The tables have been drawn up based on the undiscounted cash flows
of financial liabilities based on the earliest date on which the Company can be required to pay. The tables include both interest and
principal cash flows.
To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the
reporting period. The contractual maturity is based on the earliest date on which the group may be required to pay.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
Particulars < 1 year 1-5 years > 5 years Total
Financial liabilities
Long term borrowings - 26,033 3,623 29,656
Short term borrowings 6,333 - - 6,333
Trade payables 16,159 - - 16,159
Derivative liabilities 379 - - 379
Other financial liabilities 16,831 531 2 17,363
Total 39,702 26,563 3,625 69,890
` in crores
Particulars < 1 year 1-5 years > 5 years Total
Financial assets
Investments 312 - 797 1,109
Trade receivables 4,704 - - 4,704
Cash and cash equivalents 582 - - 582
Bank balances other than cash and cash equivalents 481 - - 481
Loans 230 190 188 608
Derivative assets 151 - - 151
Other financial assets 530 290 3 823
Total 6,990 480 988 8,458
Financial liabilities
Long term borrowings - 27,906 3,817 31,723
Short term borrowings 2,177 - - 2,177
Trade payables (including acceptances) 15,944 - - 15,944
Derivative liabilities 96 - - 96
Other financial liabilities 8,615 746 173 9,534
Total 26,832 28,652 3,990 59,474
The amount of guarantees given included in Note 44(i) represents the maximum amount the Group could be forced to settle for the
full guaranteed amount. Based on the expectation at the end of the reporting period, the group considers that it is more likely than
not that such an amount will not be payable under the arrangement.
Collateral
The Group has pledged part of its trade receivables, short term investments and cash and cash equivalents in order to fulfil certain
collateral requirements for the banking facilities extended to the Group. There is obligation to return the securities to the Group
once these banking facilities are surrendered (refer note 20 and 25).
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Significant
Valuation technique Change Sensitivity of the input to fair value
unobservable inputs
Investments in unquoted DCF method Discounting 0.50% 0.50% Increase / (decrease) in the discount
Preference shares Rate 8.40% would decrease / (increase) the fair value by
` 2 crores / (` 2 crores)
Details of financial assets / liabilities measured at amortised but fair value disclosed in category wise
` in crores
As at As at
Particulars Level Valuation technique and key inputs
31 March 2019 31 March 2018
Long term borrowings
Carrying value 41,063 37,216 Discounted cash flow method - Future cash flows are
II discounted by using rates which reflect market risks.
Fair value 41,816 37,677
Premium payable on 463 301 Discounted cash flow method - Future cash flows are
II
redemption of debentures discounted by using rates which reflect market risks.
Loans – financial assets
Carrying value 994 608 Discounted cash flow method - Future cash flows are
II
Fair value 994 608 discounted by using rates which reflect market risks.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
3) Relatives of KMP
Mrs. Savitri Devi Jindal
Mr. Prithvi Raj Jindal
Mr. Naveen Jindal
Mrs. Nirmala Goyal
Mrs. Urmila Bhundelka
Mrs. Sangita Jindal
Mrs. Tanvi Shete
Mr. Parth Jindal
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
` in crores
Joint ventures Other related parties # Total
Particulars
FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18
Loan given
JSW Techno Projects Management Limited - - 5 447 5 447
JSW Projects Limited - - 300 300 300 300
Monnet Ispat & Energy Limited 125 - - - 125 -
Total 125 - 305 747 430 747
Donation/ CSR Expenses
JSW Foundation - - 26 11 26 11
Total - - 26 11 26 11
Recovery of Expenses incurred by us on their
behalf
JSW Energy Limited - - 19 3 19 3
JSW Cement Limited - - 43 17 43 17
JSW Jaigarh Port Limited - - 7 5 7 5
JSW Infrastructure Limited - - 6 6 6 6
Monnet Ispat & Energy Limited 15 - - - 15 -
Others 4 3 19 4 23 7
Total 19 3 94 35 113 38
Investments / Share Application Money given
during the year
JSW Severfield Structures Limited 38 45 - - 38 45
Creixent Special Steels Limited 370 - - - 370 -
Others @ @ - - @ @
Total 408 45 - - 408 45
Finance lease interest cost
JSW Projects Limited - - 156 177 156 177
JSW Techno Projects Management Limited - - 54 25 54 25
Total - - 210 202 210 202
Finance lease obligation repayment
JSW Projects Limited - - 204 183 204 183
Others - - 8 4 8 4
Total - - 212 187 212 187
Liabilities Written back
JSW MI Steel Service Centre Private Limited 3 - - - 3 -
South West Port Limited - - 3 - 3 -
Jindal Saw Limited - - 3 - 3 -
JSW Projects Limited - - 3 - 3 -
JSW Infrastructure Limited - - 11 - 11 -
Others @ - 1 - 2 -
Total 3 - 21 - 25 -
Dividend paid
JSW Holdings Limited - - 57 40 57 40
JSW Techno Projects Management Limited - - 74 52 74 52
Sahyog Holdings Private Limited - - 35 25 35 25
Others - - 76 53 76 53
Total - - 242 170 242 170
@ - less than ` 0.50 crores
# includes relatives of KMP
The group has created provision of ` Nil (previous year – ` 7 crores) towards doubtful receivable from other related parties
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Notes:
1. The Group makes monthly contributions to provident fund managed by JSW Steel EPF Trust for qualifying Vijayanagar employees.
Under the scheme, the Group is required to contribute a specified percentage of the payroll costs to fund the benefits. During the
year, the Group contributed ` 20 crores (previous year ` 17 crores).
2. The Group maintains gratuity trust for the purpose of administering the gratuity payment to its employees (JSW Steel Group Gratuity
Trust and JSW Steel Limited Employee Gratuity Fund). During the year, the Group contributed ` 5 crores (previous year ` 18 crores).
Notes:
1. As the future liability for gratuity is provided on an actuarial basis for the company as a whole, the amount pertaining to individual
is not ascertainable and therefore not included above.
2. The remuneration includes perquisite value of ESOPs in the year it is exercised ` Nil (previous year ` 32 crores). The Company
has recognised an expenses of ` 4 crores (previous year ` 2 crores) towards employee stock options granted to Key Managerial
Personnel. The same has not been considered as managerial remuneration of the current year as defined under Section 2(78)
of the Companies Act, 2013 as the options have not been exercised.
4. The Independent Non-Executive Directors are paid remuneration by way of commission and sitting fees. The commission payable
to the Non-Executive Directors is based on the number of meetings of the Board attended by them and their Chairmanship/
Membership of Audit Committee during the year, subject to an overall ceiling of 1% of the net profits approved by the Members.
The Company pays sitting fees at the rate of ` 20,000/- for each meeting of the Board and sub-committees attended by them.
The amount paid to them by way of commission and sitting fees during FY 2018-19 is ` 3 crores (FY 2017-18 is ` 4 crores), which is
not included above.
Purchases:
The purchases from related parties are made on terms equivalent to those that prevail in arm’s length transactions and in the ordinary
course of business. Purchase transactions are based on made on normal commercial terms and conditions and market rates.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Note:
The Group maintains gratuity trust for the purpose of administering the gratuity payment to its employees (JSW Steel Group Gratuity
Trust and JSW Steel Limited Employee Gratuity Fund). As on 31 March 2019, the fair value of plan assets was as ` 87 crores (As at
31 March 2018: ` 85 crores).
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
In response to a petition filed by the iron ore mine owners and purchasers (including the Company) contesting the levy of Forest
Development Tax (FDT) on iron ore on the ground that the State does not have jurisdiction to legislate in the field of major minerals which
is a central subject, the Honourable High Court of Karnataka vide its judgement dated 3 December 2015 directed refund of the entire
amount of FDT collected by Karnataka State Government on sale of iron ore by private lease operators and National Mineral Development
Corporation Limited (NMDC). The Karnataka State Government has filed an appeal before the Supreme Court of India (“SCI”). SCI has not
granted stay on the judgement but stayed refund of FDT. The matter is yet to be heard by SCI. Based on merits of the case and supported
by a legal opinion, the Company has not recognised provision for FDT of ` 1,043 crores (including paid under protest – ` 665 crores) and
treated it as a contingent liability.
The State of Karnataka on 27 July 2016, has amended Section 98-A of the Forest Act retrospectively substituting the levy as Forest
Development Fee (FDF) instead of FDT. In response to the writ petition filed by the Company and others, the Honourable High Court of
Karnataka has vide its order dated 4 October 2017, held that the amendment is ultra-vires the Constitution of India and directed the
State Government to refund the FDF collected. The State Government has filed an appeal before the SCI, and based on merits of the
case duly supported by a legal opinion and a favorable order from the High Court, the Company has not recognised provision for FDF
amount of `1,117 crores (including paid under protest - `255 crores) pertaining to the private lease operators & NMDC and treated it as
contingent liability.
(iv) Supreme Court (SC) passed a judgement dated 28 February 2019, relating to components of salary structure that need to be taken
into account while computing the contribution to provident fund under the EPF Act. There are numerous interpretative issues
relating to the Supreme Court (SC) judgement including the effective date of application. The Company continues to assess any
further developments in this matter for the implications on financial statements, if any.
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
45. Commitments
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Capital commitments
Estimated amount of contracts remaining to be executed on capital account and not provided for 18,044 12,664
(net of advances)
Other commitments
a) The Group has imported capital goods under the export promotion capital goods scheme to utilize the 11,742 5,133
benefit of a zero or concessional customs duty rate. These benefits are subject to future exports. Such
export obligations at year end aggregate to
b) The Group has given guarantees to Commissioner of Customs in respect of goods imported. 127 127
c) The Company entered a five year Advance Payment and Supply Agreement (“APSA”) agreement with Duferco S.A. (“DSA”) for supply of Steel Products.
Duferco S.A has provided an interest bearing advance amount of US $ 700 million under this agreement, secured by committed export of steel
products to Duferco S.A
The agreements are renewable and cancellable by mutual consent of both parties. The rent paid on above is based on mutually agreed rates.
iii. The group has leased out land and other facilities under non-cancellable operating lease. Total rental income under such lease
during the year amounted to ` 0.03 crores (previous year: ` 0.03 crores).
Future minimum lease rentals receivable expected under non-cancellable operating lease are as follows:
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Not later than one year @ @
Later than one year but not later than five years @ @
Later than five years @ @
@ - Less than `0.50 crores
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
b) As lessee:
(i) Lease rentals charged to profit and loss for right to use the following assets are:
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Office premises, residential flats, plant and equipment etc 72 47
The agreements are executed for a period of 11 to 180 months with a renewable clause and also provide for termination at will by either
party giving a prior notice period of 1 to 3 months.
(ii) The agreements for certain plant and equipment is on non-cancellable basis for a period of 10-15 years, which are renewable on
expiry of the lease period at mutually acceptable terms.
` in crores
For the year ended For the year ended
Particulars
31 March 2019 31 March 2018
Plant and equipment 9 9
Future minimum rentals payable under non-cancellable operating leases are as follows:
` in crores
As at As at
Particulars
31 March 2019 31 March 2018
Not later than one year 10 6
Later than one year but not later than five years 18 13
Later than five years 31 -
Total 59 19
(iii) One of the subsidiaries has entered into lease agreement with Government of West Bengal for obtaining the lease hold land with
lease term of 99 years. The subsidiary doesn’t have an option to purchase the leased land at the expiry of leased period. The
initial lease term was for 99 years with a further renewable of 99 years on the same terms & conditions and to such other terms &
conditions as the State Government may from time to time consider necessary.
The minimum lease payments and the present value of minimum lease payments as at 31 March 2019 in respect of aforesaid plant
and equipment acquired under the finance leases are as follows:
` in crores
Present value of minimum
Minimum lease payments
lease payments
Particulars
As at As at As at As at
31 March 2019 31 March 2018 31 March 2019 31 March 2018
Not later than one year 486 419 260 221
Later than one year but not later than five years 1,775 1,875 1,227 1,380
Later than five years 773 322 470 180
Total 3,034 2,616 1,957 1,781
Less: future finance charges 1,077 835
Present value of minimum lease payments 1,957 1,781
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
48. During the previous year, the Group had surrendered one valuers based on cash flow projections over a period of
of its iron ore mines in Chile considering its economic the lease at a pre-tax discount rate of 18.0 %. In making
viability and accordingly had reassessed the recoverability the said projections, reliance has been placed on
of the carrying amounts of Property, Plant and Equipment, estimates of future prices of coal, mineable resources,
Goodwill and advances pertaining to the said iron ore mine and assumptions relating to operational performance,
and recognised an impairment provision of ` 264 crores and availability of infrastructure facilities for mines.
which had been disclosed as an exceptional item in the
iv Integrated Steel Complex at Salboni, Bengal [PPE ` 229
consolidated financial statements.
crores (` 117 crores as at 31 March 2018), CWIP `15 crores
The provision of ` 264 crores includes ` 76 crores towards (` 146 crores as at 31 March 2018), leasehold land ` 74
Property, Plant and Equipment, ` 166 crores towards Goodwill crores (` 75 crores as at 31 March 2018) and advances
and ` 22 crores towards Advances. ` 148 crores (` 148 crores as at 31 March 2018)] -
Evaluation of current status of the integrated Steel
49. In assessing the carrying amounts of Goodwill, PPE, Capital
Complex (including power plant) to be implemented in
work in progress (CWIP), Leasehold land, Inventories and
phases at Salboni of district Paschim Medinipur in West
Advances aggregating to ` 5,950 crores relating to certain
Bengal, and the plans for commencing construction of
businesses (listed below), the Company considered various
the said complex.
factors as detailed there against, and concluded that they
are recoverable. v. Integrated Steel Complex at Ranchi, Jharkhand [PPE
` 45 crores (` 45 crores as at 31 March 2018), CWIP ` 31
i. PPE (including CWIP and advances) of ` 3,886 crores
crores (` 31 crores as at 31 March 2018) and Advances
(` 3,776 crores as at 31 March 2018) relating to steel
` 1 crores (` 1 crores as at 31 March 2018)] - Evaluation
operations at Baytown, USA - Estimate of values of
of current status of the integrated Steel Complex to be
the businesses and assets by independent external
implemented in phases at Ranchi, Jharkhand and the
valuers based on cash flow projections at a pre-tax
plans for commencing construction of the said complex.
discount rate of 16.1 %. In making the projections,
reliance has been placed on estimates of future prices vi. Goodwill ` 24 crores (` 24 crores as at 31
of steel, and assumptions relating to operational March 2018) and Inventories ` 121 crores (` 121 crores
performance including significant improvement in as at 31 March 2018) relating to interest in a real
capacity utilisation and margins based on forecasts of estate property – Valuation of the property by an
demand in local markets and capacity expansions. independent expert.
ii. Goodwill, PPE, CWIP and capital advances of ` 471 vii. PPE ` 87 crores including mining development
crores (` 443 crores as at 31 March 2018), ` 131 crores and projects ` 76 crores (` 81 crores including
(` 131 crores as at 31 March 2018) and ` 8 crores mining development and projects ` 79 crores as at
(` 8 crores as at 31 March 2018) respectively relating 31 March 2018) and goodwill ` 7 crores (` 7 crores as at
to iron ore mines at Chile - Estimate of values of the 31 March 2018) relating to coal mines at Mozambique
assets by independent external valuers based on - Assessment of mineable reserves by independent
cash flow projections over a period of the lease at experts based on plans to commence operations
a pre-tax discount rate of 18.9 %/ implied multiple after mining lease arrangements are in place for
approach. In making the said projections, reliance which application has been submitted to regulatory
has been placed on estimates of future prices of authorities and infrastructure is developed.
iron ore, mineable resources, assumptions relating
to operational performance and availability of 50. Research and development activities
infrastructure facilities for mines.
The manufacturing and other expenses include
` 37 crores (previous year – ` 29 crores) in respect of
iii. Goodwill, PPE, CWIP and Capital advances of ` 244
research and development activities undertaken during the
crores (` 229 crores as at 31 March 2018), ` 421 crores
year. Depreciation expenditure includes ` 13 crores (previous
(` 394 crores as at 31 March 2018), ` 2 crores (` Nil
year – ` 12 crores) in respect of research and development
crores as at 31 March 2018) and ` 5 crores (` Nil crores
activities undertaken during the year.
as at 31 March 2018) respectively relating to coal
mines at West Virginia, USA - Estimate of values of
the businesses and assets by independent external
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The above joint ventures are accounted using the equity method in these consolidated financial statements.
Summarised financial information in respect of the Group’s, material joint ventures is set out below. The summarized financial information
below represents amounts shown in joint ventures financial statements prepared in accordance with Indian GAAP (adjusted by the
Group for equity accounting purposes).
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
52. Subsidiaries
Details of the Group’s subsidiaries at the end of reporting period are as follows:
Proportion of ownership interest and
Place of incorporation and
Name of the subsidiary voting power held by the Group Principal activity
operation
31 March 2019 31 March 2018
JSW Steel (Netherlands) B.V. Netherlands 100% 100% Acquisition and investment in steel
related & allied businesses and trading
in steel products
JSW Steel Italy S.R.L. Italy 100% 100% Trading in steel products
Aferpi S.p.A. Italy 100% - Produces & distributes special
(w.e.f. 24 July 2018) long steel products
Piombino Logistics S.p.A. Italy 69.27% - Manages the logistic infrastructure of
(w.e.f. 24 July 2018) piombino’s port area
GSI Lucchini S.p.A. Italy 100% - Producer of forged steel balls
(w.e.f 24 July 2018)
JSW Steel (UK) Limited United Kingdom 100% 100% Investment in steel related and steel
allied businesses
Periama Holdings, LLC United States of America 100% 100% Holding company of JSW Steel (USA) Inc. and
West Virginia operations
JSW Steel (USA) Inc. United States of America 90% 90% Manufacturing plates, pipes and
double jointing
Purest Energy, LLC United States of America 100% 100% Holding company
Meadow Creek Minerals, LLC United States of America 100% 100% Mining company
Hutchinson Minerals, LLC United States of America 100% 100% Mining company
R.C. Minerals, LLC United States of America 100% 100% Mining company
Keenan Minerals, LLC United States of America 100% 100% Mining company
Peace Leasing, LLC United States of America 100% 100% Mining company
Prime Coal, LLC United States of America 100% 100% Management company
Planck Holdings, LLC United States of America 100% 100% Holding company
Rolling S Augering, LLC United States of America 100% 100% Mining company
Periama Handling, LLC United States of America 100% 100% Coal loading company
Lower Hutchinson Minerals, LLC United States of America 100% 100% Mining company
Caretta Minerals, LLC United States of America 100% 100% Mining company
JSW Panama Republic of Panama 100% 100% Holding company for Chile based companies
Holdings Corporation and trading in iron ore
Inversiones Euroush Limitada Chile 100% 100% Holding company (LLP) of Santa Fe Mining
Santa Fe Mining Chile 70% 70% Mining company
Santa Fe Puerto S.A. Chile 70% 70% Port company
JSW Natural Resources Limited Republic of Mauritius 100% 100% Holding company of JSW Natural
Resources Mozambique Limitada and JSW
Mali Resources SA
JSW Natural Resources Mozambique 100% 100% Mining company
Mozambique Limitada
JSW ADMS Carvao Limitada Mozambique 100% 100% Mining company
Acero Junction Holdings, Inc United States of America 100% - Investment in steel related and steel
(w.e.f. 15 June 2018) allied businesses
JSW Steel (USA) Ohio, Inc. United States of America 100% - Manufacturing of slabs and hot rolled coils.
(w.e.f. 15 June 2018)
JSW Steel Processing India 100% 100% Steel service center
Centres Limited
JSW Bengal Steel Limited India 98.68% 98.68% Steel plant
JSW Natural India 98.68% 98.68% Mining related company
Resources India Limited
JSW Energy (Bengal) Limited India 98.68% 98.68% Power plant
JSW Natural India 98.68% 98.68% Mining related company
Resource Bengal Limited
JSW Jharkhand Steel Limited India 100% 100% Steel plant and mining
JSW Steel Coated India 100% 100% Steel plant
Products Limited
Amba River Coke Limited India 100% 100% Coke oven and Pellet plant
Nippon Ispat Singapore 100% 100% Mining company
Singapore (PTE) Limited
Erebus Limited Mauritius 100% 100% Mining company
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Revenue 30 - 1,594 15
Expenses 145 111 1,909 19
Profit/ (loss) for the year (91) (111) 706 (78)
Profit / (loss) attributable to owners of the company - (78) 635 (31)
Profit / (loss) attributable to the non-controlling interest (91) (33) 71 (47)
Profit / (loss) for the year (91) (111) 706 (78)
Other comprehensive income attributable to owners of the company - - - @
Other comprehensive income attributable to the non- - - - @
controlling interests
Other comprehensive income for the year - - - (1)
Total comprehensive income attributable to the - (78) 635 (32)
owners of the company
Total comprehensive income attributable to the non- (91) (33) 71 (47)
controlling interests
Total comprehensive income for the year (91) (111) 706 (79)
Net cash inflow / (outflow) from operating activities 39 (17) (229) (81)
Net cash inflow / (outflow) from investing activities (72) (19) (24) (205)
Net cash inflow / (outflow) from financing activities 34 36 241 306
Net cash inflow / (outflow) 1 - (12) 20
@- between ` (0.50) crores to ` 0.50 crores
b) On 24 May 2019 the board of directors recommended a final dividend of ` 4.10 per equity share be paid to shareholders for
financial year 2018-19, which is subject to approval by the shareholders at the Annual General Meeting to be held on 25 July 2019.
If approved, the dividend would result in a cash outflow of ` 1,195 crores inclusive of dividend distribution tax of ` 204 crores.
54. Previous year figures have been re-grouped / re-classified wherever necessary.
As % of
Name of entity in the group As % of As % of consolidated As % of total
consolidated net Amount consolidated Amount other Amount comprehensive Amount
assets profit or loss comprehensive income
income
PARENT COMPANY
JSW Steel Limited 62.09 21,324 106.94 8,046 32.00 (16) 107.44 8,030
SUBSIDIARIES
INDIAN
JSW Steel Processing Centres Limited 0.23 80 0.35 26 - @ 0.35 26
JSW Bengal Steel – Group 1.19 410 (0.12) (9) - @ (0.12) (9)
Amba River Coke Limited 6.11 2,097 2.51 189 (14.00) 7 2.62 196
JSW Steel Coated Products Limited 6.85 2,351 1.71 129 (38.00) 19 1.98 148
JSW Steel Salav Limited 1.87 642 0.62 47 - @ 0.63 47
JSW Jharkhand Steel Limited 0.22 77 (0.05) (4) - - (0.05) (4)
Peddar Realty Private Limited 0.43 147 0.03 2 - - 0.03 2
Dolvi Minerals and Metals Private Limited – Group 0.06 22 (0.44) (33) - @ (0.44) (33)
JSW Realty & Infrastructure Private Limited 0.75 256 0.40 30 - - 0.40 30
JSW Industrial Gases Private Limited 0.66 226 0.37 28 - - 0.37 28
JSW Utkal Steel Limited 0.20 69 (0.01) (1) - - (0.01) (1)
Hasaud Steel Limited - @ - @ - - - -
JSW Retail Limited (0.00) (1) - @ - - - -
FOREIGN
CORPORATE OVERVIEW
JSW Steel (Netherlands) B.V. (1.50) (516) (0.56) (42) - - (0.56) (42)
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
Periama Holding LLC – Group 12.65 4,344 (3.50) (263) - - (3.52) (263)
JSW Panama Holdings Corporation - Group 2.13 733 - @ - - - -
JSW Steel (UK) Limited 0.39 133 (0.11) (8) - - (0.11) (8)
JSW Natural Resources Limited - Group 0.33 113 0.01 1 - - 0.01 1
Arima Holding Limited - @ - @ - - - -
Lakeland Securities Limited - @ - @ - - - -
STATUTORY REPORTS
411
` in crores
412
Net Assets, i.e., total assets minus Share in other comprehensive Share in total comprehensive
Share in profit or loss
total liabilities income income
As % of
NOTES
Name of entity in the group As % of As % of consolidated As % of total
consolidated net Amount consolidated Amount other Amount comprehensive Amount
assets profit or loss comprehensive income
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
56. Standards issued but not yet effective principal and interest. Earlier, there was no guidance on
Ind AS 116 Leases was notified by MCA on 30 March 2019 and classification of such instruments.
it replaces Ind AS 17 Leases, including appendices thereto.
According to the amendments, these types of
Ind AS 116 is effective for annual periods beginning on or
instruments can be classified as measured at
after 1 April 2019. Ind AS 116 sets out the principles for the
amortised cost, or measured at fair value through
recognition, measurement, presentation and disclosure of
profit or loss, or measured at fair value through other
leases and requires lessees to account for all leases under a
comprehensive income by the lender or issuer if the
single on-balance sheet model similar to the accounting for
respective conditions specified under Ind AS 109
finance leases under Ind AS 17. The standard includes two
are satisfied.
recognition exemptions for lessees – leases of ‘low-value’
assets (e.g., personal computers) and short-term leases ii. Amendments to Ind AS 12, Income Taxes:
(i.e., leases with a lease term of 12 months or less). At the The first amendment requires an entity to create a
commencement date of a lease, a lessee will recognise corresponding liability for Dividend Distribution Tax
a liability to make lease payments (i.e., the lease liability) (DDT) when it recognises a liability to pay a dividend.
and an asset representing the right to use the underlying The liability for DDT shall be recorded in statement of
asset during the lease term (i.e., the right-of-use asset). profit & loss, other comprehensive income or equity, as
Lessees will be required to separately recognise the interest the case may be.
expense on the lease liability and the depreciation expense
The second amendment relates to tax consequence of
on the right-of-use asset.
an item whose tax treatment is uncertain. Tax treatment
Lessees will be also required to remeasure the lease liability of an item is considered as uncertain when there is
upon the occurrence of certain events (e.g., a change in uncertainty whether the relevant taxation authority will
the lease term, a change in future lease payments resulting accept the tax treatment of that item or not.
from a change in an index or rate used to determine those
If there is uncertainty over tax treatment of an item an
payments). The lessee will generally recognise the amount
entity should predict the resolution of the uncertainty.
of the remeasurement of the lease liability as an adjustment
If it is probable that the taxation authority will accept
to the right-of-use asset.
the tax treatment, there will be no impact on the
Lessor accounting under Ind AS 116 is substantially amount of taxable profits/losses, tax bases, unused
unchanged from today’s accounting under Ind AS 17. tax losses/credits and tax rates. In vice-versa case, the
entity shall show the effect of the uncertainty for each
Lessors will continue to classify all leases using the same
uncertain tax treatment on amount of related items by
classification principle as in Ind AS 17 and distinguish
using either the most likely outcome or the expected
between two types of leases: operating and finance leases.
outcome of the uncertainty.
The Group is in the process of evaluating the effect of these
iii. Amendment to Ind AS 19, Employee Benefits:
amendments on the financial statements.
The amendments to Ind AS 19, Employee Benefits
Amendments to other Ind ASs- relate to effects of plan amendment, curtailment and
i. Amendments to Ind AS 109, Financial Instruments: settlement. When an entity determines the past service
The amendments notified to Ind AS 109 pertain cost at the time of plan amendment or curtailment,
to classification of a financial instruments with it shall remeasure the amount of net defined benefit
prepayment feature with negative compensation. liability/asset using the current value of plan assets
Negative compensation arises where the terms of the and current actuarial assumptions which should reflect
contract of the financial instrument permit the holder the benefits offered under the plan and plan assets
to make repayment or permit the lender or issuer to put before and after the plan amendment, curtailment
the instrument to the borrower for repayment before the and settlement.
maturity at an amount less than the unpaid amounts of
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2019
The Group is in the process of evaluating the effect of these amendments on the financial statements.
As per our report of even date For and on behalf of Board of Directors
For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
RAJEEV PAI SAJJAN JINDAL
Chief Financial Officer Chairman & Managing Director
per VIKRAM MEHTA DIN 00017762
Partner
Membership No. 105938 LANCY VARGHESE SESHAGIRI RAO M.V.S.
Company Secretary Jt. Managing Director & Group CFO
DIN 00029136
ICSI Membership No. FCS 9407
Place: Mumbai Place: Mumbai
Date: 24 May 2019 Date: 24 May 2019
Part A: Subsidiaries
` in crores
JSW Steel Lower
JSW Steel (UK) Periama JSW Steel Prime Coal Planck Rolling S Periama Caretta
Name of the Subsidiary (Netherlands) Hutchinson
Limited Holdings LLC (USA) Inc. LLC Holdings LLC Augering LLC Handling LLC Minerals LLC
B.V. Minerals LLC
A Reporting Currency USD GBP USD USD USD USD USD USD USD USD
B Exchange rate 69.17 90.48 69.17 69.17 69.17 69.17 69.17 69.17 69.17 69.17
C Share Capital 316.83 138.22 99.26 5,554.46 0.73 514.30 30.53 27.68 560.61 11.21
D Reserves and Surplus (1,343.84) (117.20) (557.06) (5,356.27) (91.76) (119.14) (74.53) (69.73) (209.72) (19.42)
E Total Assets 949.56 134.63 6,347.59 5,274.87 0.39 611.85 0.03 - 803.35 0.94
F Total Liabilities 1,976.57 113.61 6,805.39 5,076.68 91.42 216.69 44.03 42.05 452.46 9.15
G Investment 153.52 - 1,881.47 - - 563.10 - - - -
H Turnover - - - 2,897.41 - - - - 159.81 -
I Profits / (Losses) before Taxes (137.91) (13.23) (223.77) (453.73) (6.27) (23.87) (2.55) (2.81) (5.75) 1.80
J Provision for Taxation - - 118.74 (66.71) - 11.40 - - - -
K Profits / (Losses) after Taxes (137.91) (13.23) (342.51) (387.02) (6.27) (35.27) (2.55) (2.81) (5.75) 1.80
L Proposed Dividend - - - - - - - - - -
M % of shareholding 100.00% 100.00% 100.00% 90.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
` in crores
JSW Panama Inversiones
Meadow Creek Keenan Hutchinson Peace R.C. Minerals Purest Energy Santa Fe Santa Fe
Name of the Subsidiary holdings Eurosh
Minerals LLC Minerals LLC Minerals LLC Leasing LLC LLC LLC Mining Puerto S.A.
Corporation Limitada
A Reporting Currency USD USD USD USD USD USD USD USD USD USD
B Exchange rate 69.17 69.17 69.17 69.17 69.17 69.17 69.17 69.17 69.17 69.17
CORPORATE OVERVIEW
C Share Capital 28.10 3.72 35.33 - 53.44 85.42 0.69 0.30 13.60 0.34
D Reserves and Surplus (78.39) (8.01) (50.86) (0.21) (64.17) (152.38) 39.96 (653.71) (234.59) (12.38)
E Total Assets 0.28 - 0.28 - - - 40.66 423.34 206.16 -
F Total Liabilities 50.57 4.29 15.81 0.21 10.73 66.96 0.01 1,076.75 427.15 12.04
G Investment - - - - - - 0.29 9.52 - -
H Turnover - - - - - - - - - -
I Profits / (Losses) before Taxes (2.65) (0.04) 0.17 (0.01) (0.01) (2.09) 1.27 (37.63) (17.72) -
STATUTORY REPORTS
415
Form AOC-I (Continued)
416
` in crores
JSW Natural Acero
JSW Natural JSW ADMS Nippon Ispat Arima Lakeland JSW Steel
Resources Erebus Junction JSW Steel Italy
Name of the Subsidiary Resources Carvao Singapore Holdings Securities (USA) Ohio
Mozambique Limited Holdings S.R.L.
Limited Limitada (PTE) Limited Limited Limited Inc.*
Lda Inc. *
A Reporting Currency USD USD USD SGD USD USD USD USD USD EURO
` in crores
JSW Steel JSW Natural
Piombino JSW Bengal JSW Natural JSW Energy
GSI Luchini Processing Resources Amba River JSW Jharkhand
Name of the Subsidiary Aferpi S.p.A. * Logistics Steel Resources (Bengal)
S.p.A. * Centres Bengal Coke Limited Steel Limited
S.p.A. * Limited India Limited Limited
Limited Limited
A Reporting Currency EURO EURO EURO INR INR INR INR INR INR INR
B Exchange rate 77.70 77.70 77.70 1.00 1.00 1.00 1.00 1.00 1.00 1.00
C Share Capital 163.74 11.04 21.26 50.00 458.21 107.33 29.86 64.20 931.90 88.03
D Reserves and Surplus (5.29) 1.16 83.12 49.27 (14.63) (4.83) (6.04) (3.98) 764.51 (11.52)
E Total Assets 1,335.18 116.48 196.70 116.58 464.27 102.51 99.22 60.24 3,685.21 77.76
F Total Liabilities 1,176.73 104.28 92.32 17.31 20.69 0.01 75.40 0.02 1,988.80 1.25
G Investment 12.61 - - - 140.53 - 64.20 - 52.38 -
H Turnover 1,041.82 35.77 305.62 54.55 - - - - 4,803.05 -
I Profits / (Losses) before Taxes (285.61) (35.26) (4.95) 32.57 (8.60) (0.21) (0.03) (0.50) 273.23 (4.16)
J Provision for Taxation (51.16) (5.99) (0.39) 9.84 (0.58) 0.05 - - 96.82 -
K Profits / (Losses) after Taxes (234.45) (29.27) (4.56) 22.73 (8.02) (0.26) (0.03) (0.50) 176.41 (4.16)
L Proposed Dividend - - - - - - - - - -
M % of shareholding 100.00% 100.00% 69.27% 100.00% 98.68% 98.68% 98.68% 98.68% 100.00% 100.00%
Form AOC-I (Continued)
` in crores
Dolvi JSW
Peddar JSW Steel Creixent
JSW Steel Minerals Dolvi Coke JSW Realty & Industrial JSW Utkal Hasaud Milloret
Realty Coated Special JSW Retail
Name of the Subsidiary (Salav) & Metals Projects Infrastructure Gases Steel Steel Steel
Private Products Steels Limited
Limited Private Limited Private Limited Private Limited Limited Limited #
Limited Limited Limited #
Limited Limited
A Reporting Currency INR INR INR INR INR INR INR INR INR INR INR INR
B Exchange rate 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
C Share Capital 0.01 50.05 1,334.86 350.01 1,083.33 0.01 92.08 39.44 0.01 - - 0.01
D Reserves and Surplus (31.68) 1,761.85 (923.18) (400.22) (36.71) 65.75 155.99 (2.45) - - - 0.04
E Total Assets 122.58 5,670.03 1,400.63 1,151.42 2,572.00 453.24 294.64 76.36 0.01 - - 1.54
F Total Liabilities 154.25 3,858.13 988.95 1,201.63 1,525.38 387.48 46.57 39.37 - - - 1.49
G Investment - 69.93 - 1,083.33 - 44.64 72.28 - - - - -
H Turnover - 12,173.61 1,719.60 12.58 345.62 32.00 552.95 - - - - 1.53
I Profits / (Losses) before Taxes 3.10 120.45 50.11 (127.44) (38.47) (27.93) 44.87 (1.70) - - - 0.06
J Provision for Taxation 0.64 40.82 12.00 - (17.38) (7.94) 17.24 - - - - 0.02
K Profits / (Losses) after Taxes 2.46 79.63 38.11 (127.44) (21.09) (19.99) 27.63 (1.70) - - - 0.04
L Proposed Dividend - - - - - - 24.00% - - - - -
M % of shareholding 100.00% 100.00% 100.00% 40.00% 40.00% 0.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Note: The financial statements of subsidiaries are converted into Indian Rupees on the basis of exchange rate as on closing day of the financial year.
* The financial statements are for the period from the 1 January 2018 to 31 March 2019.
# were subsidiaries till 27 August 2018
417
Form AOC-I (Continued)
418
Part B: Associates and Joint Ventures
` in crores
Joint ventures
Vijaynagar
Rohne Coal JSW Structural JSW MI Service JSW Vallabh
Name of Associates/ Joint Ventures Minerals JSW Severfield Gourangdih Monnet Ispat & Creixent Special
Company Metal Decking centre Private Tinplate Geo Steel LLC
Private Structures Limited Coal Limited Energy Limited $ Steels Limited #
RATIOS
Book Value Per Share (`) 103.26 84.44 99.69 115.45 145.47
Market price Per Share (`) 90.66 128.33 188.20 288.15 293.05
Earning per Share (Diluted) (`) 8.82 (14.75) 14.80 19.14 34.17
Market Capitalisation (` in crores) 21,913 31,019 45,492 69,652 70,837
Equity Dividend per Share (`) 1.10 0.75 2.25 3.20 4.10
Fixed Assets Turnover Ratio 1.18 0.78 1.03 1.31 1.51
Operating EBIDTA Margin 19.2% 17.4% 22.1% 20.7% 24.0%
Interest Service Coverage Ratio 3.40 2.17 3.38 4.05 5.40
Net Debt Equity Ratio 1.02 1.71 1.53 1.27 1.17
Net Debt to EBIDTA 2.97 5.50 3.20 2.59 2.23
* Including APSSA and excluding acceptance
RATIOS
Book Value Per Share (`) 92.21 77.65 92.67 113.91 142.08
Market price Per Share (`) 90.66 128.33 188.20 288.15 293.05
Earning per Share (Diluted) (`) 7.29 (1.40) 14.58 25.71 31.60
Market Capitalisation (` in crores) 21,913 31,019 45,492 69,652 70,837
Equity Dividend per Share (`) 1.10 0.75 2.25 3.20 4.10
Fixed Assets Turnover Ratio 1.03 0.74 0.94 1.23 1.33
Operating EBIDTA Margin 17.7% 15.4% 21.9% 20.6% 22.4%
Interest Service Coverage Ratio 1.75 1.84 3.34 4.15 5.02
Net Debt Equity Ratio 1.55 2.18 1.85 1.38 1.34
Net Debt to EBIDTA 3.81 6.39 3.41 2.57 2.43
* Including APSSA and excluding acceptance