Bihar Sponge Iron Ltd Directors Report

Dear Members,

Your directors take pleasure in presenting the 44th Annual Report along with the Audited Financial Statements of the Company for the Financial Year ended 31st March, 2026.

Financial Performance

(Rs. Lakhs)

Financial Parameters	FY 2025-26	FY 2024-25
Sales (Net of GST)	24,547.73	31,941.64
Other Income	2,746.56	2,990.62
Profit / (Loss) before Interest, Depreciation & Exceptional Items	1513.91	1,442.31
Interest & Finance Charges	-	-
Depreciation	381.63	402.88
Profit/(Loss) for the year before Exceptional Items	1132.28	1,039.43
Exceptional Items -Net income / (Expenditure)	-	-
Provision for Tax	-	-
Other Comprehensive Income	0.95	0.27
Profit/(Loss) for the year carried to Balance Sheet	1133.23	1,039.70

Outlook

The outlook for the Indian steel industry continues to remain positive, supported by strong domestic demand, sustained infrastructure development, increasing capital expenditure and growth in the construction, automobile, railway and manufacturing sectors. During FY 2025-26, India continued to strengthen its position as the worlds second-largest crude steel producer, with crude steel production increasing by more than 10% year-on-year to approximately 168.4 million tonnes, while finished steel consumption stood at around 164 million tonnes, reflecting growth of approximately 7-8%.

The Governments continued focus on infrastructure development and capital expenditure is expected to remain a key driver of steel demand. The National Steel Policy, 2017 continues to provide a long-term framework for the development of the sector, with a target of achieving 300 million tonnes of crude steel production capacity and 255 million tonnes of production by 2030-31, together with a substantial increase in per capita finished steel consumption.

The demand outlook for the Indian steel sector remains encouraging. Industry estimates indicate that steel demand growth is expected to improve further, with ICRA projecting steel demand growth of approximately 9-10% in FY 2026- 27, supported by increased Government capital expenditure on steel-intensive sectors such as roads, railways and infrastructure projects.

The Sponge Iron/Direct Reduced Iron (DRI) industry is closely linked to the growth of the steel sector, as sponge iron is an important raw material for steel production, particularly for electric arc furnace and induction furnace-based steelmaking. India remains the worlds largest producer of sponge iron, and the increasing requirement for steel, together with capacity additions and investments in downstream steel manufacturing, is expected to support continued demand for sponge iron. Indias sponge iron consumption was around 55.7 million tonnes in FY 2024-25 and is projected to increase further in the coming years.

The Company believes that the long-term fundamentals of the Indian steel and sponge iron sectors remain favourable. The continued expansion of infrastructure, urbanisation, construction activity and manufacturing, together with the Governments focus on domestic steel production and infrastructure-led economic growth, is expected to create sustained opportunities for the industry.

In view of the above, the management remains cautiously optimistic about the prospects of the steel and sponge iron industry. The Company expects to benefit from the anticipated recovery and growth in domestic steel demand, subject to prevailing market conditions, availability and cost of raw materials, energy costs and other external factors.

Operations

The Company was constrained to shut its Plant and Operations since 9th August, 2013 on account of sudden stoppage of coal supply by Central Coalfields Limited, a Unit of Coal India Limited against long term Fuel Supply Agreement. The Coal available through online auction from various Coal Companies was of lower grades and was also available at high price, therefore, it was not economically viable for the company to operate with the costlier coal.

As reported last year, with a view to earning some revenue, the Company had entered into a Facility User Agreement dated 30.12.2020 with M/s. Vanraj Steels Private Limited, Mr. Manoj Kumar Agarwal and M/s. Parasnath Advisory Private Limited.

However, M/s. Vanraj Steels Private Limited suspended its plant operations on 6th February, 2026 without any prior notice or official communication to the Company. The sudden suspension of operations adversely affected the Companys business and resulted in the termination of the existing Facility User Agreement with Vanraj.

In order to ensure continuity of the Companys business and safeguard its operational assets, the management explored alternative arrangements for operation of the Companys facilities. Accordingly, the Company entered into a Facility User Agreement dated 23rd March, 2026 with M/s. Amalgam Steel & Power Limited (“Amalgam”) for operation of the Companys Sponge Iron Plant, Railway Siding and other associated facilities on mutually agreed terms and conditions.

Pursuant to the aforesaid arrangement, the revamping and renovation work of the Plant and Railway Siding is presently in progress. Commercial operations of the Plant are proposed to commence upon successful completion of the renovation and revamping work in accordance with the terms and conditions of the Facility User Agreement.

The Company has also initiated appropriate legal proceedings against M/s. Vanraj Steels Private Limited, Mr. Manoj Kumar Agarwal and other concerned parties in connection with

the suspension of operations, alleged breach of contractual obligations and consequential losses suffered by the Company.

The Company remains focused on revival and sustainable operations of its Plant and associated facilities. The management is hopeful that upon commencement of commercial operations under the new Facility User Agreement, the Company will be able to generate adequate operating revenue and improve its financial position. Accordingly, the financial statements have been prepared on a going concern basis, considering the managements plans for revival of the business, restructuring of liabilities and operation of the Plant through a third-party arrangement for generation of revenue.

During the FY 2025-26 Company has made a profit of Rs. 1133.23 Lacs. Management is hopeful of earning good profit in future and losses suffered in past will get wiped out upon successful completion of the renovation and revamping work.

Corporate Social Responsibility

The Board of Directors of the Company had dissolved the Corporate Social Responsibility Committee pursuant to the provision of Section 135(9) of the Companies Act, 2013 (“the Act”) and the functions of the said Committee are now being discharged by the Board. The Company has a Corporate Social Responsibility (CSR) Policy in accordance with the provisions of the Act and rules made thereunder. The CSR Policy along with the CSR projects approved by the Board; and the relevant details are disclosed on the website of the Company at www. bsil.org.in.

The Annual Report on the CSR activities undertaken by the Company during the Financial Year under review, in the prescribed format, is annexed to this Report as “Annexure -F”.

Dividend

In view of the losses suffered by the Company in the past, no dividend has been proposed for the financial year ended 31st March, 2026.

Share Capital

The Paid-up Equity Share Capital as on 31st March, 2026 is Rs. 9020.54 lakhs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

Fixed Deposits

During the year under review, your Company has not accepted any deposits within the meaning of provisions of Chapter V - Acceptance of Deposits by Companies, of the Act read with the Companies (Acceptance of Deposits) Rules, 2014.

Subsidiary, Associate and Toint Ventures

The Company does not have any Subsidiary, Associate or Joint Venture Company as on 31st March, 2026.

Material Changes and Commitments

There were no material changes and commitments affecting the financial position of the Company which occurred between the end of financial year and the date of report.

Directors

Changes in Directors and Key Managerial Personnel

Since last reported, the following changes have taken place in the Board of Directors and Key Managerial Personnel:

In accordance with the provisions of Section 152 of the Act 2013, Mr. Jayesh Modi (DIN: 02849637) retires by rotation at ensuing Annual General Meeting and being eligible offers himself for re-appointment. Your directors recommend his re-appointment.

There were no other changes in the composition of the Board of Directors of the Company. There was no appointment, resignation, retirement, or cessation of any Director during the year, except as already stated in this Report.

None of the Directors of the Company is disqualified under Section 164 (2) of the Act. Your directors have made necessary disclosures as required under various provisions of the Companies Act, 2013

Composition of Key Managerial Personnel

Pursuant to the relevant provisions of Section 203 of the Act, the Company has the following KMPs:

S. No.	Name	Designation
1.	Mr. Aditya Kumar Modi	Whole Time Director (Designated as Director - Operations cum Occupier)
2.	Mr. Sachin	Chief Financial Officer
3.	Mr. Vimal Prasad Gupta	Company Secretary & Compliance Officer

Declaration by Independent Directors

All the Independent Director(s) have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

Formal Evaluation of Board, Committees and Directors

Pursuant to the provisions of Section 134 of the Act and Regulation 17 of the SEBI Listing Regulations, Independent Directors at their meeting (without participation of the Non- Independent Directors and Management) have considered/ evaluated the Boards performance, Performance of the Chairman and other Non-Independent Directors.

The Board subsequently evaluated the performance of the Independent Directors as per the criteria laid down and has recommended their continuation on the Board of the Company. The working of its Committees (Audit, Nomination and Remuneration and Stakeholders Relationship) and Independent Directors (without participation of the Director being evaluated) were also evaluated. The criteria for performance evaluation have been detailed in the Corporate Governance Report.

Number of Board Meetings

During the year 2025-26, Four (4) Board Meetings were convened and held. Details of the same are given in the Corporate Governance Report which forms part of this report. The intervening gap between either two meetings was within the period prescribed under the Act, and the SEBI Listing Regulations.

Directors Responsibility Statement.

Pursuant to Section 134 (5) of the Act, the Directors of your Company declare as under that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) the directors had 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 and of the profit of the company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis;

(e) the directors, had laid down and implemented internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Statement regarding opinion of the Board with regard to Integrity, Expertise and Experience of the Independent Director appointed during the year

During the year under review, no new Independent Director was appointed on the Board of the Company. Accordingly, the requirement to provide a statement regarding the opinion of the Board with regard to the integrity, expertise and experience of any Independent Director appointed during the year is not applicable to the Company.

Significant and Material orders passed by the Regulators or Courts or Tribunals

During the year under review, there were no significant material orders passed by the Regulators or Courts or Tribunals that could impact the going concern status of the Company and its future operations.

Auditors and Auditors Report Statutory Auditor

The Company has appointed M/s. Doogar & Associates, Chartered Accountants (FRN: 000561N), as Statutory Auditors of the Company, to hold office for a 1st term of five (5) consecutive years from the conclusion of the 42nd Annual General Meeting (AGM) until the conclusion of the 47th AGM of the Company.

Auditors Qualification

Notes to accounts referred to in the Auditors Report are self-explanatory and therefore do not call for any further explanation. However, the following has not been recognized as explained below:

a. Rs. 215.28 Lakhs recovered by South Eastern Coal Fields Ltd as penalty on account of short lifting of coal quantity in terms of Fuel Supply Agreement as the matter has been disputed by the Company under writ petition. Since the writ petition filed by Company before the Honble High Court of Chhattisgarh, Bilaspur has been disposed off on 5th March, 2025 with the directions “The concerned authority shall afford an opportunity of hearing to the petitioner and the respondent/ SECL and a decision shall be taken by the said authority strictly in accordance with the law in an objective manner. The authority concerned shall consider the submissions made by the petitioner or its representatives and decide the same preferably within a period of 60 days from the 21st of April, 2025. The petitioner would be at liberty to revive its prayer, if the cause of action still subsists”.

In accordance with the said order of Honble High Court, meeting of both parties was held on 19.06.2025. SECL did not consider the representation made by the Company and disposed off the matter. The Company has filed new Writ Petition against the order/decision of SECL before Honble High Court, Chhattisgarh vide WPC/24721 of 2025. The Writ Petition filed by the Company against the order/decision of SECL before Honble High Court, Chhattisgarh vide WPC/24721 of 2025 has been dismissed by the court on 27-10-2025. The Company is in process of finalising the appeal against the said order.

Pending final settlement, the amount has been included in long terms loans and advances.

The Company is hopeful that it would get an order in its favour.

b. The company has taken loan from their promotors companies. Interest on unsecured loan taken from Promoters and other parties from 10.08.2013 to 31.03.2026 has not been taken into account as the Company will approach the lenders for the waiver of the interest on unsecured loan.

c. Interest on Soft Loan from Government of Jharkhand under Jharkhand Industrial Rehabilitation Scheme 2003 amounting to Rs. 8272.61 lakhs have been provided in books only to the extent of Rs.2746.19 lakhs (i.e. until 10th August2013) and is subject to approval of representations for waiver of the entire amount.

d. In terms of the “Facility User Agreement” entered with the plant operator, liabilities as mentioned in note are recoverable from/contractually required to be borne by the operator.

The company is taking appropriate legal course and the management does not foresee any impairment/ provision against the dues, considering the contractual obligations of the operator and managements assessment of recoverability. Regarding the outcome of the dispute and the extent of recoverability of the dues, we are unable to comment whether any adjustment is necessary to the carrying value of the related balances and the consequential impact, if any, on the accompanying financial statements.

Internal Auditors

M/s. Sarat Jain & Associates, Chartered Accountants (FRN: 014793C), Noida, conducted Internal Audit periodically and submitted their reports to Audit Committee. Their Reports have been reviewed by the Audit Committee.

Cost Auditors

The Board of Directors, on the recommendation of the Audit Committee, have appointed M/s. M.K. Singhal & Co., Cost Accountants (FRN: 00074), as the Cost Auditors to audit the cost accounting records maintained by the Company for the financial year 2026-27 at a remuneration of Rs.1,00,000/- plus taxes as applicable and reimbursement of out-of-pocket expenses. As required under the Companies Act, 2013, a resolution seeking members approval for the remuneration payable to the Cost Auditor forms part of the notice convening the 44th Annual General Meeting.

Secretarial Auditor

In view of the amendments to Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, The Company has appointed M/s. Soniya Gupta & Associates, Company Secretaries (PCS COP No. 8136), as the Secretarial Auditor of the Company, in terms of Section 204 of the Companies Act, 2013, to hold office for a 1st term of five (5) consecutive years from the conclusion of the 43rd Annual General Meeting (AGM) until the conclusion of the 48th AGM of the Company.

The Secretarial Audit Report for financial year 2025-26 is attached as “Annexure - A” with this report.

The observations in the secretarial audit report are self- explanatory and therefore do not call for any further explanation.

Particulars of Loans, Guarantees or Investments under Section 186

The Company has not given any loans, guarantees or made any investments under Section 186 of Companies Act, 2013 during the financial year 2025-26.

Internal Financial Control and their Adequacy

The Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures.

Risk Management Policy

As per Section 134(3) (n) of the Companies Act, 2013, the Company has adopted a Risk Management Policy which is reviewed on a periodic basis to recognize and reduce exposure to risks wherever possible. The Companys Risk management policies are based on the philosophy of achieving substantial growth and managing risks involved.

Nomination and Remuneration Policy

In accordance with the requirements under Section 178 of the Companies Act, 2013 and Listing Regulations, the Committee formulated a Nomination and Remuneration policy to govern the nomination/appointment, criteria for determining qualifications, positive attributes, independence of a Director and remuneration of Directors, Key Managerial Personnel, other employees and senior Management of the Company. Details of Composition of Committee are given in the Corporate Governance Report.

The aforesaid policy can be accessed on the Companys website at www.bsil.org.in/policies.html.

Vigil Mechanism / Whistle Blower Policy

In compliance of Section 177 (9) & (10) of the Companies Act, 2013 and in terms of Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has set up a whistle blower policy which can be viewed on the Companys website at www.bsil.org.in/ policies.html. In terms of the said policy, the Directors and employees are given direct access to the Chairman of the Audit Committee to report on alleged wrong doings.

Your Company hereby affirms that no Director/ employee has been denied access to the Chairman of the Audit Committee and that no complaints were received during the year.

Particulars of Contracts or Arrangements with Related Parties

All the Related party Transactions entered by the Company during the financial year were done in the ordinary course of business and at Arms Length. The Audit Committee granted omnibus approval for the said related party transactions (which are repetitive in nature) and the same was reviewed by the Audit Committee and the Board of Directors.

During the year, your Company had not entered material significant transactions i.e. transactions exceeding ten percent of the annual consolidated turnover with Related Parties and the same are within the limits approved by the Shareholders of the Company. Furthermore, suitable disclosures as are required under IND AS - 24 have been made in the Notes to the Financial Statements.

The details of these transactions, as required to be provided under section 134(3) (h) of the Companies Act, 2013 are disclosed in Form AOC-2 as “Annexure-B” and forms part of this report.

The policy on materiality to regulate transactions between the Company and its related parties, in compliance with the applicable provisions of the Act, and regulation 23 of the Listing Regulations, as amended, is uploaded and can be viewed on the Companys website at www.bsil.org.in/policies. html.

Extract of the Annual Return

The extract of the Annual Return as per the provisions of Section 92 of Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014 will be made available on the website of the Company at www. bsil.org.in.

Particulars of Employees and Related Disclosures

Disclosure with respect to remuneration of Directors and employees as required under section 197 (12) of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and forming part of the Board report for the year ended 31st March, 2026 are given in “Annexure-C” to this Report.

Energy Conservation, Technology Absorption, Foreign Exchange Earnings and Outgo

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134 of the Companies Act, 2013 read with rule (8)(3) of the Companies Account Rules, 2014 is enclosed in “Annexure-D” and forms part of this report.

Corporate Governance

A report on Corporate Governance along with an Auditors Certificate confirming compliance of conditions of Corporate Governance as stipulated under Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual report.

Management Discussion Analysis Report

In terms of Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Management Discussion and Analysis Report is annexed as “Annexure-E” and form part of this report.

Listing of Securities

The equity shares of your Company continue to be listed on BSE Ltd. and the listing fee for the Financial Year 2026-27 has been paid.

Compliance with Secretarial Standards

The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India as approved by Central Government as required under Section 118(10) of the Companies Act, 2013.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

The Company is committed to providing a safe and conducive work environment to all of its employees and associates. The Company has created the framework for individuals to seek recourse and redressal to instances to sexual harassment. The Company has in place a Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH, 2013). The policy formulated by the Company at prevention of sexual harassment is available on the website of the Company at https://bsil.org.in/policies.html.

The Company has complied with the provision relating to the reconstitution of Internal Committee under POSH, 2013. In the Board Meeting held on 29th May, 2026, the Company has reconstituted the Internal Committee.

During the Financial Year 2025-26, no complaint pertaining to sexual harassment at work place has been received by the Company, hence no complaint is outstanding as on 31st March, 2026 for redressal.

Compliance with the Maternity Benefit Act, 1961:

The Company has complied with the provisions of the Maternity Benefit Act, 1961, including all applicable amendments and rules framed thereunder. The Company is committed to ensure a safe, inclusive, and supportive workplace for women employees. As per policy of the Company, all eligible women employees, are entitled to maternity benefits as prescribed under the Maternity Benefit Act, 1961, including paid maternity leave, nursing breaks, and protection from dismissal during maternity leave.

The Company also ensures that no discrimination is made in recruitment or service conditions on the grounds of maternity. Necessary internal systems and HR policies are in place to uphold the spirit and letter of the legislation.

Gender-wise Composition of Employees:

In alignment with the principles of diversity, equity, and inclusion (DEI), the Company discloses below the gender composition of its workforce on role of the Company as on 31st March, 2026.

Male Employees: 21 Female Employees: Nil Transgender Employees: Nil

The Companys efforts to promote an inclusive workplace culture and equal opportunity for all individuals, regardless of gender but plant is in interior location from city, so female employees do not prefer to join in our plant location.

Details of application made or any proceeding pending under The Insolvency and Bankruptcy Code

After the closure of Financial Year 2025-26, the Company has received two demand notices under the Insolvency and Bankruptcy Code, 2016 from M/s. Agarwal Coal Corporation Private Limited and M/s. Gohil Enterprises Private Limited in respect of alleged operational debts which are disputed.

Further, M/s. Agarwal Coal Corporation Private Limited, being the Operational Creditor, has filed an application under the Insolvency and Bankruptcy Code, 2016, before the Honble NCLT, Bench at Kolkata, against the Company in respect of the alleged operational disputed debt. The said application is pending before the NCLT as on the date of this Report.

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

During the year under review, no one time settlement was made by the Company with any Banks or Financial Institutions.

Acknowledgement

Your directors take this opportunity to place on record their sincere thanks to all stakeholders, various departments of Central Government, the Government of Bihar and Jharkhand, Financial Institutions and Banks for their valuable assistance. Your directors equally acknowledge the trust reposed by you in the Company. The Directors also wish to place on record their appreciation for the all-round support and co-operation received from the employees at all levels.

For & on behalf of the Board of Directors of
Bihar Sponge Iron Limited
	Umesh Kumar Modi
	Chairman & President
Place: London	DIN: 00002757
Date: 14th August, 2026