electrosteel steels ltd Directors report

Dear Shareholders,

The Board of Directors (Board) presents the Companys 16^th Annual Report along with the Audited Financial Statements for the year ended March 31, 2023.

FINANCIAL SUMMARY/HIGHLIGHTS AND BUSINESS PERFORMANCE

Particular	Year Ended 31 Mar 2023	Year Ended 31 Mar 2022
Revenue from operation	7,97,757.92	6,59,586.91
Other Income	7,470.22	20,396.88
Finance Cost	37,605.47	33,822.02
Exceptional Item	-	(5,847.67)
Profit/ (Loss) before exceptional items and tax	(4,7077.25)	8,267.99
Profit/(Loss) after tax	(55,790.59)	(9,459.19)
EPS (Basic & Diluted) (INR)	-3.02	-0.51

ESL Steel Limited (Formerly known as Electrosteel Steels Limited) (hereinafter referred to as ESL or the Company) is a fully integrated iron and steel manufacturing unit, situated at Siyaljori Village in Bokaro, Jharkhand. The Company currently has a capacity of 1.7 MTPA hot metal production and an expansion plan underway to enhance the capacity to 3 MTPA steel production.

In the Financial Year 2023, the Company has achieved the highest ever hot metal production of 1.367 MT up 1 % Y-O-Y and highest ever saleable production of 1.284 MT up by 2% Y-O-Y. However, the EBITDA margins have contracted by 56% Y-O-Y mainly due to rapid dynamic price changes in both input commodities and finished products, there was abnormal surge in international Coking Coal prices in the beginning of the year. In addition to that Government of India on 22nd May 2022, had imposed export duty on our products i.e.- Pig iron, TMT & Wires rod and increased export duty on all grades of iron ore however the same has been withdrawn by the Central Government on 19^th November 2022 and restored status quo prevailing before 22^nd May 2022, which resulted in better performance in Q4.

The Company is working on optimizing the cost in all aspects and increasing the production and operational efficiency for better product mix and price realization to protect the margins.

As an initiative to cost optimization and ensure the continuous supply of Iron ore through backward integration, the Company acquired two mines during the Financial Year 2022-23. The Company produced 5.67 million tons of iron ore from both the mines making the steel plant self-sufficient in its iron ore requirement in the financial year.

ESL primarily caters to Indian market, capitalizing on the projected 8% growth in Indias GDP for the upcoming fiscal year. Over the next 3 to 5 years, the Indian steel industry is poised to experience a substantial 8 to 10% growth, driven primarily by the surging demand fueled by the national infrastructure pipeline. This ambitious pipeline is anticipated to witness an investment influx of approximately 1.5 billion dollars in the next 5 years, with significant projects such as Pradhan Mantri Awas Yojana, Har Ghar Jal Yojana, and various other infrastructure initiatives directly influencing our products. Furthermore, the stability of raw material prices, particularly iron ore and metallurgical coal, is expected to remain stable, contributing to an optimistic outlook for the upcoming fiscal year.

DIVIDEND

In view of the losses incurred by the Company during the Financial Year, the Management of the Company expresses their inability to declare any dividend for the financial year ended 31st March 2023.

TRANSFER TO RESERVES

No amounts have been transferred to the Reserve during the year under review.

EQUITY SHARE CAPITAL

(a) Authorised Share Capital:

Authorised Share Capital of your Company as on March 31, 2023, is INR 1,00,20,00,00,000 divided into 10,02,00,00,000 Equity Shares of INR 10 each.

(b) Issued, Subscribed and Paid-Up Share Capital of the Company:

Issued, Subscribed and Paid-Up Share Capital of your Company as on March 31, 2023, is INR 18,49,03,02,240 divided into 1,84,90,30,224 Equity Shares of INR 10 each fully paid up.

(c) Buy Back of Securities:

The Company has not bought back any of its securities during the Financial Year under review.

(d) Sweat Equity:

The Company has not issued any Sweat Equity Shares.

(e) Bonus Shares:

The Company has not issued any Bonus Shares.

(f) Employees Stock Option Plan:

The Company has not provided any Stock Option Scheme to the employees.

None of the Directors of the Company hold any equity shares or convertible instruments of the Company.

HOLDING COMPANY

Vedanta Limited (VEDL) is the ‘Holding Company of ESL Steel Limited, holding 95.49% of the share capital of the Company. VEDL holds 1,76,55,53,040 no. equity shares of INR 10 each.

CREDIT RATING

CRISIL Ratings has updated its rating on the long-term bank facilities of your Company to ‘CRISIL AA- from ‘CRISIL AA. The rating on the short-term bank facilities has been reaffirmed at

‘CRISIL A1+

DEPOSITS

The Company has not accepted any deposits from the public within the meaning of the provisions of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 any modifications and reenactment thereof and any other applicable law for the time being in force.

NATURE OF BUSINESS

There has been no change in the nature of the business of the Company during the year.

MEETINGS OF BOARD & ITS COMMITTEES

The Board meets at regular intervals to discuss and decide on Company/business policy and strategy in addition to the statutory and other matters. During the financial year 2022-23, the

Board of Directors met Five (5) times i.e., on 19-04-22, 21-07-22, 29-09-22, 18-10-22, 19-01-23. The intervening gap between the meetings was within the period prescribed under the provision of Section 173 of the Companies Act, 2013. The Board of Directors of your Company as on 31^st March 2023 consists of following Members:

1. Mr. Thomas Mathew T Non-Executive Independent Director

2. Mr. Mahendra Singh Mehta - Non-Executive Independent Director

3. Mr. Prasun Kumar Mukherjee - Non-Executive Independent Director

4. Mr. Ashish Kumar Gupta - Chief Executive Officer & Whole Time Director

5. Ms. Poovannan Sumathi - Non Executive Woman Director

Attendance during the year 2022-23:

Name of Member	No. of meetings held	No. of meetings entitled to attend	No. of meetings attended
Mr. Thomas Mathew T***	5	4	4
Mr. Prasun Kumar Mukherjee	5	5	5
Mr. Mahendra Singh Mehta	5	5	5
Ms. Poovannan Sumathi	5	5	4
Mr. Navnath Laxman Vhatte *	5	3	3
Mr. Ashish Kumar Gupta **	5	2	2

* Ceased to be Whole Time Director w.e.f September 30, 2022.

** Appointed as Whole-Time Director w.e.f October 01, 2022.

*** Appointed as the Non-Executive Independent Director w.e.f. June 15, 2022

Committees Meetings:

Audit Committee

The Audit Committee is constituted pursuant to provisions of Companies Act, 2013 and consists of following Members, as on 31st March 2023:

1. Mr. Prasun Kumar Mukherjee, Non-Executive Independent Director Chairman

2. Mr. Mahendra Singh Mehta, Non-Executive Independent Director Member

3. Mr. Ashish Kumar Gupta, Chief Executive Officer & Whole Time Director Member

During the financial year 2022-23, the Audit Committee members met Four (4) times i.e., on 19-04-22, 19-07-22, 18-10-22, 19-01-23.

Attendance during the year 2022-23:

Name of Member	No. of meetings held	No. of meetings entitled to attend	No. of meetings attended
Mr. Prasun Kumar Mukherjee	4	4	4
Mr. Mahendra Singh Mehta	4	4	4
Mr. Navnath Laxman Vhatte *	4	2	2
Mr. Ashish Kumar Gupta**	4	2	2

* Ceased to be Whole Time Director w.e.f September 30, 2022.

** Appointed as Whole-Time Director w.e.f October 01, 2022.

Nomination and Remuneration Committee

The Nomination & Remuneration Committee is constituted pursuant to provisions of Companies Act, 2013 and consists of following Members as on 31st March 2023:

1. Mr. Prasun Kumar Mukherjee, Non-Executive Independent Director Chairman

2. Mr. Mahendra Singh Mehta, Non-Executive Independent Director - Member

3. Ms. Poovannan Sumathi, Non-Executive Director Member

During the financial year 2022-23, the Nomination and Remuneration Committee members met Three (3) times i.e., on 19-04-22, 19-07-22, 29-09-22.

Attendance during the year 2022-23:

Name of Member	No. of meetings held	No. of meetings entitled to attend	No. of meetings attended
Mr. Prasun Kumar Mukherjee	3	3	3
Mr. Mahendra Singh Mehta	3	3	3
Ms. Poovannan Sumathi	3	3	2

Stakeholders Relationship Committee

The Stakeholders Relationship Committee is constituted pursuant to provisions of Companies Act,

2013 and consists of following Members as on 31^st March 2023:

1. Mr. Prasun Kumar Mukherjee, Non-Executive Independent Director Chairman

2. Mr. Ashish Kumar Gupta, Chief Executive Officer & Whole Time Director - Member

3. Ms. Poovannan Sumathi, Non-Executive Director Member

4. Mr. Thomas Mathew T, Non-Executive independent Director- Member

During the financial year 2022-23, the Stakeholders Relationship Committee members met once (1) time i.e., 19-04-22.

Attendance during the year 2022-23:

Name of Member	No. of meetings held	No. of meetings entitled to attend	No. of meetings attended
Mr. Prasun Kumar Mukherjee	1	1	1
Mr. Navnath Laxman Vhatte *	1	1	1
Ms. Poovannan Sumathi	1	1	0
Mr. Ashish Kumar Gupta**	1	0	0

* Ceased to be Whole Time Director w.e.f September 30, 2022.

** Appointed as Whole-Time Director w.e.f October 01, 2022.

Corporate Social Responsibility Committee

Corporate Social Responsibility Committee constituted pursuant to provisions of Companies Act, 2013, consists of following Members as on 31^st March 2023:

1. Mr. Prasun Kumar Mukherjee, Non-Executive Independent Director Chairman

2. Mr. Thomas Mathew T, Non-Executive Independent Director-Member

3. Mr. Ashish Kumar Gupta, Chief Executive Officer & Whole Time Director - Member

4. Ms. Poovannan Sumathi, Non-Executive Director Member

KEY MANAGERIAL PERSONNEL

Pursuant to Section 203 of Companies Act, 2013, the Key Managerial Personnel of your Company as on 31^st March 2023 are:

1. Mr. Ashish Kumar Gupta - Chief Executive Officer & Whole Time Director

2. Mr. Anand Prakash Dubey - Chief Financial Officer

3. Mr. Manish Kumar Chaudhary - Company Secretary

INDEPENDENT DIRECTORS AND THEIR DECLARATION

During the financial year Mr. Prasun Kumar Mukherjee, Mr. Mahendra Singh Mehta, and Mr. Thomas Mathew T were the Independent Directors of the Company. The Company has received

declarations pursuant to Section 149(7) of the Companies Act, 2013 from both the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013.

The Independent Directors have submitted a declaration that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence.

Further, declaration on compliance with Rule 6(3) of the Companies (Appointment and

Qualification of Directors) Rules, 2014, as amended by Ministry of Corporate Affairs ("MCA")

Notification dated October 22, 2019, regarding the requirement relating to enrolment in the Data Bank created by MCA for Independent Directors, has been received from all the Independent Directors.

Further, in terms of Rule 8(5) (IIIA) of the Companies (Accounts) Rules, 2014, as amended, the Board of Directors state that in the opinion of the Board, Mr. Thomas Mathew T., whose appointment as Independent Director of the Company has been approved by the Shareholders at the 15^th Annual General Meeting held during the FY-2022-23, is a person of integrity and possesses relevant expertise and experience. Further, Mr. Mathew is qualified to act as an Independent Director as per the Rules of Indian Institute of Corporate Affairs.

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors hereby confirm, in terms of Section 134 (5) of the Companies Act, 2013 ("the Act"), that:

a. in the preparation of annual accounts, containing financial statements for the year ended

March 31, 2023, the applicable accounting standards have been followed along with proper explanations for any material departures from those standards, wherever required.

b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 2022-23 and of the loss of the Company for that period.

c. they have taken proper and sufficient care for the maintenance of adequate accounting

records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting any fraud and other irregularities.

d. they have prepared Annual Accounts on a going concern basis.

e. Sufficient internal financial controls have been laid down and such internal financial controls are adequate and were operating effectively.

f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

SUBSIDIARY/ASSOCIATE /JOINT VENTURE COMPANY

The Company did not have any subsidiary/associate /joint venture Company during the year ended March 31, 2023.

INTERNAL FINANCIAL CONTROLS

Internal financial controls mean the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information. The Company has a well-documented Standard Operating Procedures (SOP) for procurement of materials, capital expenditure, human resources, sales and marketing, finance, treasury, compliance, Health, Safety and Environment (HSE) etc.

Company has in place systems, policies, and procedures/frameworks, which are currently operational, for ensuring the orderly and efficient conduct of its business, which includes adherence to policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. In line with best practices, the Audit Committee and the Board review these internal control systems to ensure they remain effective and are achieving their intended purpose.

INVESTOR EDUCATION AND PROTECTION FUND

All unclaimed / unpaid share application money, remaining unclaimed / unpaid for a period of seven years from the date they became due for payment, are required to be transferred to the Investor Education and Protection Fund (IEPF).

During the year, the Company was not required to transfer any amount to the said IEPF.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 DURING THE YEAR ALONGWITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR.

During the year there were no applications made or any proceeding pending under the Insolvency and bankruptcy Code, 2016.

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

There were no such instances during the financial year under review, hence this clause is not applicable to us.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE

A. The Companys Consent to Operate (CTO) the greenfield integrated steel plant at Bokaro was not renewed by the Jharkhand State Pollution Control Board (JSPCB) following its expiry in December 2017 and later on was rejected by JSPCB. A writ petition was filed by the Company before the High Court of Jharkhand against the rejection orders issued by JSPCB for the renewal of its consent to operate. Subsequently the Environment Clearance (EC) was revoked by Ministry of Environment, Forest and Climate Change (MoEF), against which ESL filed a writ petition and the High Court of Jharkhand was pleased to grant a stay and allowed the plant operations to continue till the next date of hearing. The Honble Court also granted liberty to the Company to apply for statutory clearance without prejudice to its rights and contentions.

Pursuant to this order ESL applied for Forest Diversion proposal on October 4, 2018 (on without prejudice basis) and received Stage I Forest Clearance (Stage-I) from the Forest Advisory Committee (FAC) on December 17, 2019.

ESL also applied for EC and Term of Reference (ToR) was granted to complete the process of EC for 3 mtpa plant on Aug 20 2020.

While the process was continuing on September 16, 2020, the High Court of Jharkhand passed an order that the plant operations were to continue only until September 23, 2020. Against the order, ESL filed a Special Leave Petition before the Supreme Court of India and in an urgent hearing on September 22, 2020, the Supreme Court of India granted ESL a stay of the aforementioned order and granted ESL permission to continue operating the plant until further orders from the Supreme Court of India.

Further, the EAC held a meeting on July 29, 2021, and recommended the grant to EC to ESL subject to certain conditions, including the Forest Clearance. The MoEF vide its letter dated August 25, 2021, rejected "as of now" to consider the grant of EC as recommended by EAC to ESL due to stay on the Standard Operating Procedure (SOP) for identification and handling of violation cases under Environmental Impact Assessment, 2006 notification issued by MoEF & CC on July 7, 2021 for violation cases by Madras High Court (Madurai Bench).

However, it was clarified that once the aforesaid SOP is upheld or stay is vacated, the recommendation will be considered without going to the EAC again. An interlocutory application was filed in the pending Supreme Court matter against the rejection of the EC on as of now basis due to the stay on the aforesaid SOP. The Supreme Court of India pronounced the judgment on December 09, 2021 (Special Leave Petition along with the Interlocutory Application) and passed the following:

"The appeals are allowed. The impugned order is set aside. The Respondent No.1 shall take a decision on the application of the Appellant for revised EC in accordance with law, within three months from date. Pending such decision, the operation of the steel plant shall not be interfered with on the ground of want of EC, FC,CTE or CTO."

MoEF vide its letter dated February 02, 2022, has deferred to consider EACs recommendation of grant of EC till Forest Clearance Stage-II is granted to ESL. ESL has submitted its reply against MoEF letter vide letter dated February 11, 2022 for reconsidering the decision and not linking EC with FC since as per the applicable law and available precedents, grant of FC Stage

II is not a condition precedent for grant of EC.

ESL has submitted an affidavit on March 23, 2023, apprising the court of developments in 1:1 compensatory land procurement. The Court was pleased to observe that there has been much progress in the matter of obtaining forest clearance. MoEF has revoked the FC Stage-I vide letter dated June 5,2023 and against the revocation, the Company has submitted its letter to

MOEF to reconsider the FC Stage I revocation decision. The State of Jharkhand on July 24, 2023, has also written a letter to MOEF to reconsider the FC Stage I revocation of ESL in light of the progress made, efforts being taken, and the difficulties faced by the Company. MoEF has issued a letter dated Aug 18,2023 to forest department of Jharkhand (referring to the States letter) to submit the complete compliance of the condition for further consideration.

B. During the Financial year, the State government of Odisha has issued Notice of Demand dated 03.12.2022 to deposit Rs. 8,51,05,51,206/- and Rs. 8,56,75,29,626 in relation to the penalty for alleged shortfall on minimum dispatch and production requirements of Companys Nadidihi iron ore and manganese Block Mines and Nadidihi iron ore block mines situated in Odisha. The Company has filed Revision Application under Rule 35 of MCR, 2016 before the Revisional Authority, Ministry of Mines contesting the above demand. Revisional Authority has directed the state government/DDM not to take any coercive actions till further orders vide order dated 14.03.2023. The State Government has sought time to file their reply.

Under the Terms of Mine Development and Production Agreement and Rule 12A of MCR, 2016, the Company had to maintain a level of production in so as to ensure minimum dispatch of 80% of the average of annual production of the two immediately preceding years. The company believes that it has completed the minimum required level of production and dispatches. Based on a legal evaluation, Company believes that the minimum dispatch requirement would get rectified by the State government.

C. Vedanta Limited submitted its resolution plan in the course of CIRP of Electrosteel Limited for its acquisition. The resolution plan that was submitted and approved by NCLT specified NIL payment to the Operational Creditors. When the same was challenged in the Supreme Court, the Supreme Court directed while approving the Resolution plan that it is up to the financial creditors to take a haircut from their share. Subsequently IAs were filed in the NCLT by various applicants and vide order dated 28 June 2022, the NCLT directed CoC for reconsideration on NIL payment to Operational Creditor to balance the interest of all stakeholders (no observation on reassessment of resolution plan or enhancement of amount). The 14 IAs filed were disposed with above directions. SBI (being the Lead Bank) agreed for re-convening of the CoC and filed IA for reappointment of a Resolution Professional (RP) since the previous RP had been deregistered. The court opined that the appointment of RP post approval of resolution plan is a question of law which requires application of judicial mind and the court was inclined to hear and determine if such appointment is permissible by law. Order has been reserved by the Court.

There have been no material changes and commitments affecting the financial position of the

Company that have occurred between the end of the Financial Year and the date of the Boards

Report.

ANNUAL EVALUATION OF THE BOARD

The Board on the recommendation of the Nomination and Remuneration Committee had adopted

Schedule IV to the Companies Act, 2013 (hereinafter referred to as "the Act"), including any amended thereof, as criteria for evaluating performance of Independent Directors.

The Independent Directors of the Company in their meeting held on March 25, 2023, without the attendance of Non-Independent Directors and members of the Management, on the basis of defined and agreed parameters, inter alia, had:

(i) reviewed the performance of the Non-Independent Directors, the Board and Committees thereof and

(ii) assessed the quality, quantity, and timeliness of flow of information between the Management and the Board, that is necessary for the Board to be effective and reasonably perform their duties.

COVID 19 STEPS TAKEN BY THE COMPANY

The company stands by the society and community in times of despair. Since the last three years of the COVID-19-triggered emergency, the Company has undertaken various steps to protect our employees and communities including conducting of awareness programme in rural areas, organizing vaccination camps etc.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information related to conservation of energy, technology absorption, foreign exchange earnings and outgo is enclosed as "Annexure A" and forms an integral part of this Report.

STATUTORY AUDITORS

The shareholders of the Company at the Fifteenth (15^th) Annual General Meeting (AGM) held on August 26, 2022, had reappointed M/s. Lodha & Co., Chartered Accountants (Firm Registration No.:301051E) of 14, Government Place East, Kolkata 700069, as Statutory Auditors of the Company to hold office for the second term for a period of five consecutive years, commencing from the conclusion of Fifteenth (15^th) Annual General Meeting till the conclusion of the Twentieth (20^th) Annual General Meeting.

AUDITORS REPORT

M/s. Lodha & Co., Chartered Accountants have audited the books of accounts of the Company for the financial year ended March 31, 2023, and have issued the Auditors Report thereon. There are no qualifications or reservations or adverse remarks in the said Report.

During the year under review, the Auditors did not report any fraud under Section 143(12) of the Act, therefore, no detail is required to be disclosed under Section 134(3)(ca) of the Act.

COST AUDITORS & COST AUDIT REPORT

The Company is required to maintain cost records for its products as specified by the Central Government under sub-section (1) of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules as amended from time to time, and accordingly such accounts and records are made and maintained in the prescribed manner.

In terms of requirement of Section 148 of the Companies Act, 2013, read with Companies (Cost Records and Audit) Rules, 2014, (as amended), the Board of Directors of your Company, upon recommendation of Audit Committee, have appointed M/s. Sanjiban & Co., Cost Accountants, (Registration No.: 000259) as Cost Auditors, to conduct a cost audit of your Company for the financial year 2023-24, at a remuneration of INR 1,00,000.

As required under the Act, the remuneration payable to the Cost Auditors is required to be placed before the Members for ratification. Accordingly, a resolution seeking Members ratification for the remuneration payable to M/s Sanjiban & Co., Cost Accountants for financial year 2023-24 is included in the Notice convening the ensuing AGM.

The cost audit report of the Company for the financial year ended March 31, 2022, does not contain any qualification or adverse remarks, and was filed with the Ministry of Corporate Affairs (MCA) in XBRL mode within the stipulated due date and the report for the financial year ended 2023 will be filed with the MCA within the time limit prescribed under the Act.

SECRETARIAL AUDITOR & SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rules thereunder, the Board of Directors had appointed M/s. Vinod Kothari & Company, Company Secretaries of 1006-1009, Krishna Building, 224 A.J.C. Bose Road Kolkata 700 017, India, as Secretarial Auditor of the Company for the financial year 2022-23, to conduct secretarial audit of the Company. The said M/s. Vinod Kothari & Company have submitted their Report for the financial year ended March 31, 2023, which is enclosed as Annexure B and forms an integral part of this Report.

The Secretarial Audit Report does not contain any qualification, reservation, or adverse remark.

Further, Company has re-appointed the Vinod Kothari & Company, Practicing Company Secretaries of 1006-1009, Krishna Building, 224 A.J.C. Bose Road Kolkata 700 017, India, as Secretarial Auditor of the Company for the financial year 2023-24.

INTERNAL AUDITORS

In line with the provisions of Section 138 of the Companies Act, 2013, M/s. KPMG, were appointed by the Board of Directors as Internal Auditors of the Company for the financial year 2022-23. The Audit Committee defines the scope of internal audit from time to time and reviews the observations of internal auditors and the action taken report submitted by the management on the observations at its meeting held every quarter and suggests the management the improvements required in the systems followed by the Company.

Further, the Internal audit activity of your Company is managed through Management Assurance Services (MAS) function of Vedanta Limited.

The Board, on the recommendation of the Audit Committee, has re-appointed M/s. KPMG as the Internal Auditors for financial year 2023-24.

ANNUAL RETURN

In accordance with notification of Ministry of Corporate Affairs, dated August 28, 2020, read with Sec. 92(3) of the Companies Act, 2013, copy of the Annual Return of the Company shall be available on the Companys website: https://www.eslsteel.com/

PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES

The related party transactions are entered into based on considerations of various business requirements such as synergy in operations, profitability, legal requirements, liquidity, resources availability, etc. of related parties. All related party transactions are intended to further the Companys interests.

All related party transactions entered during the year 2022-23 have been placed on quarterly basis before the Audit Committee/Board for approval/noting/ratification/modification as the case may be. During the period under review related party transactions have been on arms- length basis and in the ordinary course of business. Accordingly, the particulars of the transactions as prescribed in form AOC-2 under Section 134 of the Act read with rules made therein are not required to be disclosed as they are not applicable. The policy on Related Party Transactions as approved by the Board is available on the

Companys website: https://www.eslsteel.com/.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements, if any.

RISK MANAGEMENT POLICY

The Company has in place a Risk Management Policy, which is reviewed by the Audit Committee from time to time. The Company has constituted a Risk Management Committee at the management level, which identifies potential risks associated with the Company and formulates its mitigation plan.

CORPORATE SOCIAL RESPONSIBILITY POLICY

The Company has in place a Board approved Corporate Social Responsibility Policy and it is available on the website of the Company at https://www.eslsteel.com/.

During the year, the Company has undertaken various CSR initiatives, although not mandatory under Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014.

MANAGERIAL REMUNERATION AND REMUNERATION POLICY

The information required pursuant to Section 197 read with Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request.

In terms of Section 136 of the Companies Act, 2013 the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company in this regard.

The Company has in place a Remuneration Policy and it is available on the website of the Company at https://www.eslsteel.com/.

DISCLOSURE UNDER "THE SEXUAL HARASSMENT OF WOMEN AT

WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition, and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

As part of Vedanta Group, your Company is an equal opportunity employer and believes in providing opportunity and key positions to women professionals. The Group has endeavored to encourage women professionals by creating proper policies to tackle issues relating to safe and proper working conditions and create and maintain a healthy and conducive work environment that is free from discrimination. This includes discrimination on any basis, including gender, as well as any form of sexual harassment.

During the financial year 2022-23, one (1) complaint was received, investigation was completed, and the case has been resolved.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has in place a robust vigil mechanism for reporting genuine concerns through the

Companys Whistle Blower Policy. As per the Policy adopted by various businesses in the Group, all complaints are reported to the Director Management Assurance, who is independent of operating management and the businesses. In line with global practices, dedicated email IDs, a centralized database, a 24X7 whistle blower hotline and a web-based portal have been created to facilitate receipt of complaints.

All employees and stakeholders can register their integrity related concerns either by calling the number or by writing on the web-based portal which is managed by an independent third party. The hotline provides multiple local language options. All cases reported as part of whistle blower mechanism are taken to their logical conclusion within a reasonable timeframe. After the investigation, established cases are brought to the Group Ethics Committee for decision making. All Whistle Blower cases are periodically presented and reported to the Companys Audit

Committee. The details of this process are provided in the Whistle Blower Policy and is posted on the Companys website https://www.eslsteel.com/ .

SECRETARIAL STANDARDS

The Company has in place proper system to ensure compliance with the provisions of the applicable Secretarial Standards issued by The Institute of Company Secretaries of India and such systems are adequate and operating effectively.

AWARDS, RECOGNITIONS & CERTIFICATIONS

Your Company has received multiple awards, recognitions, and certifications during the financial year 2022-23, which includes the following:

1. Great Place to Work Certified (3rd time in a row)

2. CII HR Excellence Award - Strong commitment to HR Excellence 3. Kincentric Best Employer Award 4. ASSOCHAM Work Vision 2022 Annual HR Excellence Award 5. Happiest Workplaces Awards - powered by Happy Plus & BW 6. Healthiest Workplace Award 7. W.E. Matter Global Employees Choice Awards 2022 8. GPTW - Indias Top 50 Best Workplaces in Manufacturing 2023

GREEN INITIATIVE

In support of "Green Initiative" taken by the Ministry of Corporate Affairs ("MCA") in the Corporate Governance" by allowing service of documents by a Company to its Members through electronic mode, the Company will continue to send various communications and documents like notice calling general meetings, audited financial statements, directors report, auditors report etc., in electronic form, to the email address provided by the Members to the Depositories or to the Company.

Your Company impresses upon its shareholders to contribute to this green initiative in full measure by registering their e-mail addresses, in respect of electronic holdings with the Depository through their concerned Depository Participant. Members who hold shares in physical form are requested to take necessary steps for registering the same so that they can also become a part of the initiative and contribute to the Green Movement.

Apart from that your Company has taken the following green initiatives during the Financial Year 2022-23:

? 23000+ plantation of saplings across entire plant.

? Successful trial of biomass in CFBC boiler

? 34% green belt development

? MOU with Tata Mines (Jharia) has been done for lifting of bottom ash & Sand mould core that is generated from our CPP & DIP area

? Installed Mercury Analyser in CPP stack.

? Installed BTEX Analyzer

APPRECIATION

The Directors would like to thank the employees, shareholders, customers, suppliers, bankers, advisors, auditors, regulatory authorities and all the other stakeholders of the Company for their confidence and continued support of the Management. Your directors would also like to place on record their appreciation to the Central and State Governments for their valuable support. Your Company also recognizes and appreciates the cooperation and support from its holding company Vedanta Limited.

	For and on behalf of the Board of Directors
	Ashish Kumar Gupta	Poovannan Sumathi
	Chief Executive Officer &	Non-Executive Director
Place: Bokaro	Whole Time Director	(DIN: 07147100)
Dated: 1st September 2023.	(DIN: 07808012)