MANAGEMENT DISCUSSION AND ANALYSISINDUSTRY STRUCTURE AND DEVELOPMENTS
Global Steel Industry
After two years of deep economic recession, signs of economic stability are now visiblein the developed world. Though growth rates in the economies of developed world are stillmoderate, countries in the developing region, in contrast, have been registering high GDPgrowth.
IMF estimates a positive economic trend in 2010 and the global economy to register asharp 4% growth. The WTO also projects world trade to expand by 9%, with the developedregions growing by nearly 8% and the emerging regions by over 11%.
Following the world-wide economic crisis, the steel industry had demonstrated visiblesigns of demand pick-up and price stabilization during the last quarter of 2009. However,as a result of the deep recession through most of the year, global crude steel productionhad dipped by 8% during 2009 in comparison to the previous year. Major steel producingcountries, such as, USA, Germany, Russia, Japan and South Korea had witnessed drop inproduction ranging from 25% to 36%. In contrast, however, crude steel production in Chinaand India had grown by around 13% and 3% respectively. The global downturn of 2009 and thesubsequent recovery have accentuated the importance of China and India to the world steelindustry.
Due to the widespread economic recession, global steel consumption had declined bynearly 7% during 2009, in comparison to the previous year. Finished steel consumptionduring 2009 was 1121 Million Tons. Steel consumption in China and India grew by around 24%and 8% respectively, while other major steel producing nations had registeredsignificantly lower consumption.
Since May, 2010, however, global steel-demand has stagnated and prices are under heavypressure. The slow recovery of US and European economies had a dampening impact on overallsteel consumption.
Indian Steel Scenario
Latest projections of steel consumption by World Steel Association peg finished steelconsumption in India to reach 71 Million Tons by 2011. Several major world steel companiesare planning tie-up with Indian counterparts to produce value-added steel products inIndia. The first six months of 2010 has seen a marked increase in steel demand due tostrong growth in key user sectors, such as, automobile, infrastructure, consumer goodsetc.
Owing to the glut in overseas steel demand, there has been a significant increase indumping of cheap steel into India, much to the detriment of the domestic steel industry.Imports of both flat products as well as long products has increased substantially.
Various brownfield and greenfield expansion programmes have been announced, keeping inmind the current consumption pattern as well as the projected demand growth. Domesticsteel demand is expected to be robust and grow by 12% annually. Capacity additionscontinue to be undertaken by Indian steel majors and it is estimated that steel-makingcapacity would increase by 20% during 2010-11. However, no large greenfield steel projecthas been able to take-off, due to a stringent regulatory environment in terms of landacquisition, forest clearances, grant of mining leases etc. Poor infrastructure facilitiesalso tend to increase overall costs, with an avoidable impact on the finances of the steelindustry.
OPPORTUNITIES AND THREATS
Opportunities
The projected GDP growth, strong prevailing trends in the Index of IndustrialProduction (IIP) and increased governmental spending on core infrastructure projects areexpected to drive domestic steel consumption. Indian steel demand is likely to reach 100Million Tons in the next few years, offering a tremendous scope to Indian steel producersto tap the huge potential. Sustained growth in infrastructure, automotive andmanufacturing sectors would ensure a steady demand accretion for all steel products. Witha perceptible improvement in demand from semi-urban and even rural segments, hithertounexplored markets are being looked-into, thrust is accorded on retail penetration andservice centres are being set-up to reach the major consumption points.
On the global front, demand in European Union countries is now expected to be betterbalanced, in the long-run, in the wake of sovereign fiscal interventions. With the USeconomy expected to register a modest growth of 3%, steel demand in the region is expectedto register a growth trend and reverse the free-fall of 2009. Steel demand in ASEANcountries has picked-up in the second half of 2009 and is widely anticipated to remainstable during the year. Chinese steel demand and production are expected to maintainpositive growth trends. China’s dominance of world steel markets continues unabatedand it continues to leverage its cost competitiveness against peer nations. China’snew steel policy is expected to incentivise exports of value-added products, eliminateobsolete capacities and increase comprehensive domestic use of steel. China’s policymeasures and export initiatives would continue to determine the world steel tradescenario.
Threats
The world-wide economic crisis and financial turbulence had resulted in a sharp dip inglobal steel consumption during 2009. After several months of deep recession, based on thebacking of a fiscal stimulus-led global economic recovery, the steel industry demonstratedsigns of demand pick-up and price stabilization during the last quarter of 2009.
Though the fortune of Indian steel industry appears bright, the road ahead may not bevery smooth and is likely to be topsy-turvy on several counts. Some of the threats loominglarge over the Indian steel sector are:-
• Sharp increase in prices of raw materials, such as, iron ore, coke and cokingcoal.
• Increase in power tariff.
• Frequent interruption in iron ore supplies.
• Continuing exports of iron ore and consequent impact on domestic prices.
• Inadequate infrastructure support leading to high logistic costs.
• Delays in regulatory approvals for raw material linkages.
• Various hurdles in acquiring land for green-field steel projects.
• Dumping of cheap steel products into India and the consequent pressure ondomestic prices.
Company’s strategies
The Company’s strategies, in the current scenario, are aimed at ensuing securityof critical raw materials and innovating its product portfolio. The Company is committedto ensuring early implementation of its planned projects, so as to achieve valuablesavings in input costs. Process efficiencies shall continue to be improved, on aconsistent basis and across the entire production cycle.
The Company’s strategies are:-
• Expedite commissioning of coke-oven project of the annual capacity of 1 MillionMTs, in joint venture.
• Commission the proposed pellet project of the annual capacity of 2 Million MTs.
• Commence iron-ore mining in Damkodwadvi, Maharashtra.
• Commence iron-ore mining operations in Brazil and coal mining operations inColumbia through wholly owned subsidiaries, in joint venture.
• Expedite commissioning of the power plant project of Ispat Energy Limited.
• Enhance production of value-added steel products.
• Penetrate the retail segment and explore new segments in domestic markets.
PRODUCT / SEGMENT PERFORMANCE
Production of Hot Rolled Coils at 3.31 Million MTs was higher by 24% compared to theprevious financial year, on an annualized basis. Capacity utilization was over 80% of theenhanced annual capacity of 3.3 Million MTs.
Production of Direct Reduced Iron (Sponge Iron) at 1.68 Million MTs was higher by 23%over the previous financial year, on an annualized basis. Securing additional supplies ofNatural Gas had resulted in improved production of Direct Reduced Iron during the period.
Production of Hot Metal was higher at 2.13 Million MTs. The upgradation of BlastFurnace during 2009 had resulted in significant improvement in process efficiencies.
Production of Cold Rolled Steel Coils/Sheets and Galvanized Coils/Sheets had registeredincrease at 0.31 Million MTs and 0.20 Million MTs, respectively. In its endeavour tocontinually offer superior products, the Company has added Galvalume, a premiummetallic-coated steel product, to its product-basket. Galvaume finds extensive applicationin corrosion and temperature resistance. Production of Galvalume Coils/Sheets has beenstreamlined during the period. Production of Tubes and Pipes had also stabilized duringthe period under review. Production of PVC coated sheets during the period was at 101% ofinstalled capacity.
Sales of Hot Rolled Coils at 2.88 Million MTs was higher by 19%, compared to previousyear, on an annualized basis. Sales of Cold Rolled Steel Coils/Sheets was higher by 11%,whereas sales of Galvanized Coils/Sheets was lower by 7%, compared to previous year, on anannualized basis. Sales of Tubes and Pipes was commensurate with production achievedduring the period.
EXPORTS
Export earnings during the period under review was Rs.433.44 Crores.
Exports were lower during the period due to slack demand conditions prevailing in worldmarkets. Export realizations were significantly low leading to fall in the Company’sexport earnings.
FINANCIAL PERFORMANCE (STANDALONE) IN RELATION TO OPERATIONAL PERFORMANCE
| (Rs. in crores) |
| 15 month period ended 30th June, 2010 |
| 1 Sales / Income from operations | 10983.14 |
| Less : Excise Duty | 850.41 |
| 10132.73 |
| 2 Other Income | 445.96 |
| 3 Total Income | 10578.69 |
| 4 Total Expenditure | 8855.75 |
| 5 Profit before Interest & Finance Charges and Depreciation | 1722.94 |
| 6 Less : Interest & Finance Charges | 1285.45 |
| 7 Profit before Depreciation | 437.49 |
| 8 Less : Depreciation | 773.95 |
| 9 Profit/(Loss) before tax | (336.46) |
| 10 Provision for Taxation (Net) | |
| – Current Tax | 0.03 |
| Deferred Tax Charge / (Credit) | (14.15) |
| 11 Net Profit/(Loss) | (322.34) |
| Add : Debenture Redemption Reserve written back | 20.26 |
| Add: Balance brought forward from previous year. | (1832.15) |
| 12 Amount carried to next year | (2134.23) |
Income from operations during the fifteen-month period under review was Rs.10983.14crores and profit before interest, finance charges and depreciation was Rs.1722.94 crores.
After providing for interest and finance charges of Rs.1285.45 crores, profit beforedepreciation was Rs.437.49 crores. After providing for depreciation of Rs.773.95 crores,loss before tax provisions was Rs.336.46 crores for the period under review.
After considering deferred tax credit of Rs.14.15 crores and providing for wealth taxRs.0.03 crores, net loss during the period under review was Rs.322.34 crores. ConsideringDebenture Redemption Reserve written back Rs.20.26 crores and accumulated losses ofRs.1832.15 crores brought forward from the previous year, the accumulated losses as at 30thJune, 2010 was Rs.2134.23 crores.
MANAGEMENT OF RISKS AND CONCERNS
The Company’s Risk Management process ensures a pro-active approach to all itsbusiness risks. Identification of risks and drawing-up mitigation plans is a continuousprocess and closely linked to the Company’s Business Plans. The risk mitigation plansare subjected to continuous monitoring.
As a part of Enterprise Risk Management (ERM) process, a comprehensive Risk ManagementPolicy has been framed and activated. The Risk Management Process envisages :-
• Setting risk management objectives
• Identifying, prioritizing and reporting risk events
• Identifying risk mitigation strategies, and
• Risk monitoring and reporting.
While framing its Risk Management Policy the Company seeks to go beyond regulatoryrequirement and ensure exemplary Corporate Governance practices. The Company follows abottoms up approach for identifying and managing risks.
The Risk Management Committee of the Board reviews, periodically, all risk managementand mitigation procedures and adequacy of mitigation plans. External consultants reviewand suggest probable risks, effectiveness of mitigation plans, deployment of technologysolutions etc. Internally constituted Risk Management Committees periodically reviewidentified risks, their root causes, mitigation plans and risk-closure status. The Companyhas a well structured internal Risk Management Organisation with clearly defined roles andresponsibilities of all functionaries. Periodic meetings of the internal Committees areheld to review the status of risk mitigation plans. High risk issues are deliberated inthe internal Committee meetings and are subsequently reported to the Risk ManagementCommittee of Board of Directors. Annual activity plans are drawn well in advance andsubmitted to Risk Management Committee. A Risk Manager Tool, for monitoring riskmanagement process/status, has been implemented. External Audit Review of risk mitigationplans and control procedures are being undertaken by experts.
The Company Business Plans as well as the profitability estimates are subject toregular review by the Committee of Directors as well as the Board of Directors. Projectsunder implementation are also subject to review by the Committee of Directors and theBoard of Directors.
The Company continuously monitors its Foreign Exchange positions and exposure tocurrent and capital account transaction risks. A comprehensive Forex Risk ManagementPolicy has been developed. A Shipping Freight Risk Management Policy and Commodity RiskManagement Policy have also been adopted by the Board of Directors. An internallyconstituted Forex Risk Management Committee periodically reviews all forex operations,authorization levels etc. Status of operations under all the policies are periodicallyreviewed by the Committee of Directors/Board of Directors.
The Company has an exhaustive on-line Legal Compliance Management System, across alldivisions of the Company, to track and ensure compliance with applicable statutes. Thesystem, developed and implemented by external experts, ensures appropriate reporting ofcompliances and exceptions.
Confirmation of compliance with applicable statutory requirements are obtained from therespective units/divisions and subjected to an elaborate verification process. QuarterlyReports on Statutory Compliances, duly certified, are submitted to the Audit Committee aswell as the Board of Directors for review. Compliance(s) with exception(s), if any, areduly reported to the Audit Committee and the Board of Directors. Status of Demands/Noticeson the Company, under various Acts and Rules, as well as status of litigations arereported to the Board of Directors, every quarter.
In the process of undertaking reviews of financial projections, statutory litigationsetc., the Board of Directors and the Audit Committee are entitled to independent expertopinions, wherever felt appropriate. Revenue-related litigations are subject to detailedrisk-evaluation by independent experts, each quarter, and their reports are furnished tothe Board of Directors.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company’s internal control systems and procedures are commensurate with itssize and nature of business. Standard Operating Procedures (SOPs) have been clearlydefined for various areas of operations. Similarly, well-defined Charts of Authority(COAs) have been implemented. Standard Operating Procedures and Charts of Authority arereviewed regularly and modified to meet process requirements.
Reports of Concurrent Auditors, appointed by the Lenders, as well as Reports of theCompany’s Internal Audit Department, termed as Business Process Solutions Department,and management responses on audit observations, are subject to regular review by the AuditCommittee of Board of Directors. The Audit Committee also reviews reports of ManagementAuditors as well as Branch Auditors. The adequacy of internal control systems is alsoreviewed by the Audit Committee. Corrective actions suggested by the Audit Committee areduly implemented and reported to the Audit Committee.
The annual Audit Plan of the Business Process Solutions Department is reviewed andapproved by the Audit Committee. The Audit plan covers various operational areas and alsoensures that all material financial and management issues are properly addressed. TheAudit Committee also undertakes review of status of completion of previous Audit Plans toidentify gaps, if any, in implementation.
The Company has an elaborate financial reporting process which ensures timely review ofall financial information. The financial reporting process is also reviewed by the AuditCommittee of Board of Directors.
Internal Control Systems are strengthened by appropriate IT applications which coverall areas of operation. The advanced MySAP Business Process solution ensures coverage ofmultiple operational areas.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
The Company’s Human Resources Policy is fully aligned with its Business Plans.Corporate values are cascaded in fostering a culture of belongingness, respect and mutualtrust. The Human Resource Policy seeks to ensure a high level of motivation amongemployees so that they play a significant role in achieving the Company’s BusinessPlans.
The Company has a robust in-built system of reviewing people-related issues. Theperformance management system adopted by the Company is sought to be continuouslystrengthened with a view to ensure that employee appraisals are robust, transparent andaligned to the corporate goals. The Company’s Human Resource Committee, comprisingsenior officials, regularly review all employees related issues with a view to ensureimmediate redressal so as to effectively implement its HR plans. The Company’sBalance Score Card and Performance Management System (PMS) ensure alignment of individualresponsibility with organisational goals. The Company undertakes Employee SatisfactionSurvey to introspect on the Employee Engagement Index, so as to make timely changes in itspolicies and procedures.
The Company’s Competency Assessment Centre seeks to support the efforts of theemployees and encourage such efforts. The Company has introduced a structured successionplanning process to encourage employees take up larger responsibilities.
The "Employee of the Month" scheme adopted by the Company ensures thatperforming team members are appropriately recognized and also encourages others forenhancing their performance. The Company has introduced a well-structured successionplanning process to encourage employees for taking up larger responsibilities. TheCompany’s Employee Suggestion Scheme has been strengthened by introduction of"Star Ideas Scheme" to reward and encourage employee performance.
Employees are encouraged to undergo advanced Management Programmes (E-MBA) inInstitutes of repute.
The Company has constituted various in-house training programmes for employees’skill advancement. Employees are also deputed to various external training programmes andseminars for enhancing their competencies. The Company has also made significant changesin its training processes to address issues of skill advancement. Company has alsoinitiated a competition on "Department practicing Best HR activities" so thatculture of best HR practices percolate down the line.
Special emphasis is given to Defect Based Analysis of Training, Succession Planning,Talent Management and Study and Approach for Manpower Rationalisation. In order to keeppace with the changing times, various cost cutting initiatives also have been introducedand implemented.
In an attempt to develop Top Management Leadership, an exhaustive LeadershipDevelopment Programme – organizational excellence through personal effectiveness– Team Building and Training Programme on Toyota Production System was organized soas to build leadership qualities across second and third line employees.
The Company attempts to augment the skill matrix index of grass root level employees inorder to address issues of skill advancement, so as to align with technologicalup-gradation and stringent customer expectations.
The Company has put in place exhaustive Total Productivity Management (TPM) and GembaKaizen approaches to improve process efficiencies, across all operational areas, byleveraging the Company’s resources and aligning individuals to business goals. Theinterventions range from Process Automation, Defect Reduction, Work-area Improvement etc.,to Human Resources Initiatives and Profitability Enhancement. Business Intelligence tools,such as Cognos and Minitab, are implemented to enable process-owners to extract corporatedata and employ the same to effective use.
The Company fully recognizes its responsibility towards ensuring safety and protectionof health of its employees and all those who are associated with the Company. The Companybelieves that safety and health are essential and form an integral part of every activityperformed in the Company.
| Various employee welfare schemes have been formulated, such as, |
| • Family Help Groups, run by spouses of employees |
| • Recreational Centers |
| • Departmental get-togethers |
| • Felicitation of meritorious children of employees |
| • Mediclaim/hospitalization schemes etc. |
Various facilities are provided for monitoring health-related issues of employees. TheCompany has a full-fledged Medical Centre at its Dolvi Complex for providinground-the-clock medical assistance to its employees. Specialist Doctors visit the MedicalCentre, every fortnight, for rendering medical help. Health check-up is carried out,periodically, for all employees.
The Company had 2626 employees on its roll at various locations.
Industrial relations continued to be harmonious in all units of the Company.
AWARDS AND ACCOLADES
The Company has been conferred with the following prestigious awards during the year :-
• Fe-EVI Green Business Leadership Award 2009-10 initiated by Financial Expressand Emergent Ventures Limited
• Dr R J Rathi Award 2010 for Environment and Pollution Control
• India Manufacturing Award – Gold Certificate 2009
• Golden Peacock Award for Corporate Social Responsibility-2010
• Special Commendation for Golden Peacock Award for Excellence in CorporateGovernance 2009.
MANAGEMENT OF ENVIRONMENT
The Company has always striven to be responsible and sensitive to ecological andenvironmental matters. This is ensured by protecting, conserving and restoring all naturalresources, often far beyond what is mandated by government and other institutionalpolicies.
The Company is committed to complying in full measure with all regulations relating tothe preservation of the environment around its operations. By constantly upgradingtechnologies and by applying the best of sustainable processes and practices, the Companyendeavors to provide environmental issues the priority they deserve.
The Company is dedicated to constantly improving its performance on prevention ofpollution, proper use of natural resources and minimization of any hazardous impactstemming from production, development, use and disposal of any of its products andservices.
The Company seeks to :-
• Ensure that its vision and mission statement, which explicitly states its policyon environmental management, is observed and complied.
• Communicate environmental policy to all employees, suppliers, contractors,customers, stakeholders and the community.
• Set up environmental management systems and programmes at the organisationallevel and annually budget for environmental improvement.
• Train employees and create awareness among suppliers, contractors, customers,stakeholders and the community at large through a process of participatory dialogue andcollaboration.
• Train workforce on environmental issues and assign management representativesand facilitators to the task of monitoring environmental systems.
• Regularly scrutinize resource consumption and the quality of air, water andland.
• Set quantitative objectives and targets for continuous improvement (preferablybeyond legal compliance).
• Review environmental performance at different levels in the managementhierarchy.
This is followed by lifecycle assessments for product stewardship throughout the supplychain.
With a view to create environmental awareness amongst Company’s associates, thefollowing steps are taken :-
• All purchase orders, letterheads, envelopes etc., used for external/internalcommunications bear printed environmental slogans.
• Sub contractors have been advised to use environmental friendly technology forrecycling of wastes like scrap, used oil etc.
• Preference is given to environment friendly/proactive suppliers while purchasingraw material and consumables.
• All inter-office memos, approvals, etc., are being processed through electronicmedia with a view to reduce paper consumption.
Green Ispat week is celebrated every year to create awareness on Green Concept amongemployees. Celebrations include Poster, Essay and Slogan Competition, Tree PlantationProgramme etc.
World Environment week is also celebrated each year. The major focus of WorldEnvironment Week celebrations is to create awareness and sensitize employees on caring forthe environment. Number of activities are undertaken during the week long programme, suchas :
| • Mass Tree plantation, |
| • Inauguration of system for utilizing waste water for irrigation purpose, |
| • Lectures on Rain Water harvesting, Waste Recycling in steel Industries etc. |
At Dolvi Steel Complex
Pollution control systems for air and water are in-built with production facilities.
With a view to control dust emissions in the ambient air and work zone duringtransportation of raw materials, dust suppression systems have been installed at transferpoints. Transportation of raw materials from the Company’s Jetty to the steel complexis through a closed conveyor system.
Various air pollution control systems have been installed at the integrated facilitiesin the steel complex. The control systems include, inter-alia :-
• Dust suppression system for Junction Houses.
• Furnace Dust Collection System.
• Product Screen Dust Collection System.
• Product Silo Dust Collection System.
• Fuel Bag Dedusting System with Bag Filter.
• ESP Systems for Flux handling operations, Sinter Machine, Proportioning Houseetc.
• Fume Extraction System.
• Lime Stone Dedusting System.
• Waste gas cleaning system
• Gas cleaning plants.
Extensive water pollution control systems are put in place. The need for optimumutilization of water resources through proper planning and conservation is fully realized.Risk of water pollution and soil pollution is minimized. The importance of water as afinite, though a renewable resource, has also been clearly recognized. Land and water useare considered together. The Company has adequate resource planning and management, whichis an essential tool for safe-guarding environment. Methods adopted to minimize effluentsare :-
• Reduce the effluent generation at the source.
• Recycle of waste water
• Adopt efficient methods for treatment and utilization.
• Reduce the incoming water at source.
• Conduct regular water audits.
The Company views sustainability as a prerequisite to succeeding in markets that areemerging as a result of globalization. The Company realizes its business values throughits sustainability approach, driven by a goal of zero waste and emission.
The Company has implemented several measures to reduce CO2 emissions from itsintegrated steel plant for prevention of pollution and improve environmental performance.
The Company has taken adequate steps for Green House gas mitigation by adopting cleantechnology through renewable energy sources like waste heat recovery and energy savingprojects and elimination of reheating processes.
Various Regasified Liquified Natural Gas (RLNG) conversion projects have beenimplemented to reduce cost as well as energy consumption. Several projects have beenundertaken for achieving CO2 reduction.
With a view to avoid adverse impact of products and services on environment, thefollowing measures have been taken:-
• Full-fledged Effluent treatment Plant is provided to treat and reuse waste watergenerated in process.
• Adequate air pollution control systems are provided. All pollution controlequipments are designed for outlet emission as per statutory norms.
• All solid waste generated in the process are recycled in sinter plant
• Waste gas generated in process is used for power generation and recycled forheating purpose.
The Company has adopted and established cleaner operating and maintenance practices,inventory management, rescheduling processes, better material handling system, segregationof waste streams, education and training, through active involvement of its employees.
By using state-of-art technology, pollution prevention control is emphasized at source,which has resulted in optimum use of material, energy conservation, water and othernatural resources. The Company believes that clean technology means less waste generationand less use of resources. The Company gives less emphasis on end of the pipe treatment asit consumes more resources and gives fewer benefits.
The Company’s Annual Business Plan addresses Environment, Health and Safety needs,resources required, action plan and implementation frame work. The resources required forEnvironment, Health and Safety issues are prioritized at the strategic planning stage.
To avoid potential long term ecological and socio-economic impact of its projects, theCompany has carried out Environmental Impact Assessment (EIA) to gauge possible adverse orbeneficial effects and the report has showed overall positive impact.
Significant improvement in environmental issues have resulted due to:
• Selection and use of cleaner production technology, consumption of naturalresources and provision of pollution control facility at source.
| • Better management of resources and continuous efforts for conservation of natural resources. |
| • Implementation of ISO 14001: 2004. |
| • Recycling of maximum solid wastes by operation of Sinter Plant and Cold Briquetting Plant. |
| • Maintaining pollution discharge level below national and international norms. |
The Company has a dedicated Environment Department, well-equipped with sophisticatedlaboratory equipments and manned with qualified and trained personnel to handleenvironmental issues, carrying out analysis of water, air, stack emissions and noisemonitoring throughout its integrated Steel Mill complex. The Environment Departmentensures compliance of company’s activities with relevant EnvironmentalLaws/Regulations, conditions stipulated by Maharashtra Pollution Control Board, Ministryof Environment and Forests. The Company also arranges regular training programmes for itsemployees to create a strong awareness.
The environment monitoring reports are regularly submitted to the statutory authoritiesviz. Maharashtra Pollution Control Board (MPCB), Central Pollution Control Board (CPCB)and Ministry of Environment and Forests (MoEF) to demonstrate the Company’scommitment towards ensuring compliance of all applicable norms/guidelines.
The Company has planted large number of trees in the plant premises, as per theguidelines of MPCB. The Company is maintaining a full-fledged nursery, managed byqualified horticulture officers, to develop plants for its in-house requirements.
The Company’s plantation drive has resulted in :-
• Number of Big Trees : 163671
Main plants are Acacia Mangium, Eucalyptus, Rain Tree, Gulmohar, Subabbul, Ficusbenjamina, Coconut, Awala, Mango, Kokum etc.
| • Number of Shrubs/Ground Covers (Small Trees) : 345751 |
| Main plants are Philodendron Ceylon, Rhoeo Compacta, Syngonium, Asparagus, Rose, Pulmeria Obtusa etc. |
| • Lawn Development - 988457 Sq. Ft. |
| • Green House Development - 4 Nos. |
The Company’s office buildings have been beautified with well laid out lush greenlawns and varieties of flower plants.
At Kalmeshwar Complex
The Company complies with all environmental parameters prescribed under applicablestatutes and guidelines of Ministry of Environment and Forests, Central Pollution ControlBoard and Maharashtra Pollution Control Board. The complex is also well within theenvironmental norms prescribed under World Bank Policies and guidelines. The complex isISO 14001 certified.
Pollution control and environment management efforts undertaken during the yearinclude:-
• Successful completion of recertification audit in June 2009, covering three-yearperiod.
• Complete revamping of Acid Recovery Plant to improve recovery and production ofAcid at ARP from Pickling Line wastewater.
• Disposal of ETP sludge into common Hazardous Waste Treatment, Storage andDisposal facility, as a regular practice.
• Installation of eco-ventilators in Colour Coating Line for improvement in workplace environment.
• Replacement of bag house of CRM Boiler to ensure that dust emissions are wellbelow the prescribed MPCB norms.
• Cooling tower of Continuous Galvanising Line – 4 not being operated and theelectrical lad shared with Cooling Tower 6 to reduce energy consumption.
• Rain water collection in a soil pond within the plant to :
• Increase ground water level to maintain greenery during summer months.
• Create pleasant environmental ambience as per environment protection plan.
• Use treated water in nearby forest for growth of trees.
• Development of Green Cover (Lawn) on an additional area of 6877 Sq. Mtr. inplant (cumulative 98696 Sq. Mtr. in plant and colony). Plantation of approximately 2137plants completed within the plant and colony.
ENVIRONMENTAL RECOGNITIONS:
The Company has received the following environmental recognitions :-
• 1997 : One of the top ten Green Companies in India for the year 1997 (5th place)- Certified by "Business Barons".
• 1999 : Bagged ISO 14001 for the plant from UL Ltd., USA.
• 2006 : ‘Ispat Industries Ltd, Sponge Iron Plant, Raigad’ was declaredas the winner of "Golden Peacock Environment Management Award" for the year 2006by a jury headed by Justice P N Bhagwati, Former Chief Justice of India.
• 2010: Received Mahratta Chamber of Commerce, Industries and Agriculture (MCCIA)– Dr. R.J. Rathi Award 2010 for Environmental Pollution Control in Industries inMaharashtra.
• Fe-EVI Green Business Leadership Award 2009 -10 initiated by Financial Expressand Emergent Ventures Limited.
• India Manufacturing Award – Gold Certificate 2009.
CORPORATE SOCIAL RESPONSIBILITY
The Company is fully committed to serving the local community in which it operates.Social development activities occupy a prime place in the Company’s scheme of things.Environment protection and ecology development are core to the Company’s BusinessPlans.
Community welfare projects undertaken are, briefly :
At Dolvi Steel Complex
The Company’s Dolvi complex is surrounded by four villages. The Company believesthat it affects and is affected by the stakeholders, including the society that co-existsin the vicinity of its plant. Hence, the Company considers that it has a major stake inthe development of the area and the people who reside therein. Accordingly, it hasvolunteered its resources to the extent that it can reasonably afford to sustain andimprove a healthy and prosperous environment and to improve the quality of life of thepeople in the areas in which it operates. The Company has engaged itself in numerousactivities that are built around the motto, "Adding a bit of steel to humanlives", and is involved in producing quality steel by controlling wastes andenvironment polluting elements.
The Company’s executives visit these villages on regular basis and interact withconcerned authorities in district administration e.g. District Magistrate, Tehsildar andvarious Grampanchayats and active NGOs in the area. They take feedback about theCompany’s on-going activities, look for their need in the future and assess ways inwhich the Company can improve upon them. The Company is in constant touch with NGOs foridentifying the needs of the local community.
Health Promotion
• Health status of villagers in nearly 19 villages has been captured forpreparation of comprehensive family health cards.
• Full year medical camps are conducted for skin care, cataract detection,pediatrics, ENT, etc.
• Family planning, AIDS awareness and health awareness camps are regularlyconducted.
Socio Economic Development
• 22% of Company’s employees are from local surroundings. Perceptiblechange brought about in living standards.
• Company has adopted ten ITIs in Ratnagiri and Raigad Districts of Maharashtra.
• Company is involved in developing infrastructure, course curriculum and teachingfacilities at all the ten ITIs. Students are given on-the-job training at theCompany’s plant.
Women Empowerment
• Company has assisted in formation of over fifty Self Help Groups andsupports them in their endeavour towards self-reliance.
• Vocational training organized, in association with MITCON, for imparting skillsin making ready-made garments.
• Women empowerment programme implemented in four Group Grampanchayats. Seminarorganized on Women’s Reservation Bill alongwith health camp.
• Awareness programme conducted for Self Help Groups to hone their expertise inobtaining licences etc., for businesses. Benefits of registration with District IndustrialCentres and Food and Drug Administration as well as information on Prime Minister’sEmployment Guarantee Programme have been provided.
• Workshop organized for Self Help Groups to train on record-keeping, accountmanagement, bank transactions, drafting loan proposals etc.
Tribal Development
• Medical Plants Nursing Development Training Programme organized forbelow-poverty-line tribal women, in association with Social Forestry Department,Government of Maharashtra.
• Wild honey bee keeping Training Programme organized for tribal youths. Kits forhoney collection distributed to participants.
• De-addiction awareness/counseling workshop held for tribal community members.
• Workshop held on life style education for community members to promotesanitation, hygiene and health-awareness.
Educational Development
• Programme organised for training teachers from Government Primary Schools on"Effective Teaching". Members from NGO provided training on teaching techniques.
• School uniforms and note books distributed to nearly 8300 students studying inprivate schools in 73 Grampanchayats in the vicinity.
• Snake bite and first-aid awareness programme held.
Youth Development
• Ten "Youth Clubs" have been organized and registered by theCompany. The Company provides information to the "Youth Clubs" for availingvarious benefits from the Government. Training workshops are arranged.
• Company participants in "Youth Employment Meet" organized by DistrictEmployment Office, Raigad. Job opportunities provided for candidates, after beinginterviewed.
• Capacity building training programme organized for members of the "YouthClubs" to encourage them suggest social interventions.
Agriculture Development
• Programme organized for imparting training in vermi composting andagriculture development. Officers from District Agriculture Office provided information onorganic farming, handling compost fertilizer etc.
• Training programme on Kitchen Garden development was organized for tribal andbelow-poverty-line women.
Some of the other CSR initiatives are :
• Villages around the community are provided with treated drinking water throughpipeline laid by the Company. Clean potable water is being supplied, free of cost, tohouseholds in over 20 villages covering about 52,350 villagers.
• Roads have been repaired in the local villages.
• Doctor in-charge of Company’s Medical Center guided truck drivers on thecauses of HIV/AIDS, symptoms, preventive measures and available treatment as well assupport and care after HIV infection.
• Rendered assistance for Youth Empowerment on self-employment schemes.
• Ten days residential training on "Karate", a self defence skill, wasimparted to about 100 school girls.
• Sponsored thirty girls from four Group Grampanchayats for training in skillslike yoga and aerobics.
• Ispat Marathon is a mega-event held annually at Alibaug with an aim to nurturean interest in sports among the youth. The Marathon is handled by officials of thedistrict sports office. Over 7000 participants joined in Ispat Marathon during the year.
• Providing aid to the poor students studying in the adjoining schools, on therecommendations of the Principal/Head Master.
• Literacy campaigns have been undertaken in the nearby villages viz. Dolvi,Karavi, Wadhkhal and Gadab.
• Two computers and twenty-six sewing machines were donated to conduct vocationaltraining classes for women in village Kolad.
At Kalmeshwar Complex
Education and Training
The Company’s English Medium School at Kalmeshwar covers upto 10thStandard. There are 694 Students studying in the school.
Some of the society promotion initiatives undertaken by the Company are :-
• Inauguration of MBA Session 2009-11 at Central Institute of Business ManagementResearch & Development for knowledge and experience sharing with MBA students toinspire, motivate and guide them as "Future Managers".
• HR Round Table Conference for budding HR Managers organized by Datta MegheInstitute, Nagpur.
• Senior Citizens Forum Meet was organized. Around 120 Senior Citizensparticipated in the event. The event has provided the senior citizens a proper forum toshare their experience and knowledge.
Land protection and Forestation
• Plantation of Saplings was arranged on the occasion of "WorldEnvironment Day".
• Kitchen Waste generated at the Canteen is being given to Nagar Parishad,Kalmeshwar for their Bio-Gas Project. Prevention of pollution is a major advantage behindthe project.
Philanthropic / Community Initiatives
• Pyau at Kalmeshwar was set-up during the period April-June, 2009
• Support was extended to the procession of Ram Rath Yatra at Kalmeshwar.
• Workers Day was celebrated on 1st May with all enthusiasm, toacknowledge contributions of the workers in nation building.
• Supplied CR Sheets to Police Department for fitting onto their ambushingvehicles to lessen the impact of the landmine blasts in Naxalite areas.
• Participated in Nagpur Marathon.
• Organized free Health Check-up Camp and advise for senior citizens atKalmeshwar.
• Co-sponsorship in the district level Marathon Run organised by Satpuda Krida& Sanskritik Mandal and Sankalpvedh Programme.