Gallantt Ispat Ltd Directors Report.

TO THE MEMBERS

Your Directors have the pleasure in presenting the 17th Annual Report on the business and operations of the Company along with the Audited Financial Statements of the Company for the financial year ended March 31, 2021.

CORPORATE OVERVIEW

Gallantt Ispat Limited ("Your Company" or "The Company") is a leading Iron and Steel manufacturing Company in Eastern Uttar Pradesh. The Company has its Registered Office at New Delhi and Factory at Gorakhpur, Uttar Pradesh.

WORKING RESULTS (Rs In Lacs)

Standalone Consolidated
2021 2020 2021 2020
Financial Results
Income from operation 1,09,714.34 1,02,010.15 1,09,714.34 1,02,010.15
Other Operating Income 1,262.31 3,609.14 305.26 3,609.14
Finance Cost 1,190.49 1,166.17 1,195.62 1,166.17
Depreciation (including amortization) 2,255.98 2,395.23 2,255.99 2,395.23
Profit Before Tax 13,569.13 6,488.19 12,590.85 6,488.19
Tax Expenses (including Deferred Tax) 3,202.83 675.78 3,005.14 675.78
Profit After Tax 10,366.30 5,812.42 9,585.71 5,812.42
Share of Profit from Associate - - 2,755.63 244.15
Profit for the Period 10,366.30 5,812.42 12,341.34 6,056.57

FINANCIAL ACCOUNTING AND ADOPTION OF IND-AS

The Financial Statements for the FY 2020-21 are prepared under Ind-AS. Pursuant to Section 129(3) of the Companies Act, 2013, the Consolidated Financial Statements of the Company prepared in accordance with the Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014 and Indian Accounting Standard 110 on Consolidated Financial Statements is provided in the Annual Report.

BUSINESS OPERATION AND PERFORMANCE REVIEW

During the year Revenue from Operations stood at Rs 1,09,714.34 Lakhs as against Rs 1,02,010.15 Lakhs during the last FY 2019-20. The Profit before Interest, Production at a glance:

Depreciation and Taxation stood at Rs 1,70,15.60 Lakhs as against Rs 1,00,09.59 Lakhs in the previous year registering a growth of 69.99%. The Net Profit after Tax for the year stood at Rs 10,366.30 Lakhs against Rs 5,812.42 Lakhs in the previous year. Standalone Earnings per Share (EPS) stood at Rs 3.67 (face value of Rs. 1/- each) and Consolidated Earnings per Share (EPS) stood at Rs 4.37 (face value of Rs 1/- each) for the Financial Year ended March 31, 2021.

Despite several macroeconomic headwinds, volatile market environment and operational challenges, the Company delivered a robust performance both in terms of profitability and turnover driven by a strong focus on operational excellence and market diversification.

Product 2020-21 2019-20 % of Change
Production Sales* Production Sales* Production Sales*
Sponge Iron (M.T.) 2,32,001 2,27,746 2,69,635 2,70,181 -13.96% -15.71%
M.S. Billets (M.T.) 2,61,135 2,61,150 2,79,076 2,78,945 -6.43% -6.38%
M.S. Round Bar & Miss Rolled Bar (M.T.) 2,57,527 2,63,513 2,74,392 2,70,720 -6.15% -2.66%
Wheat Products (M.T.) 51,731 50,461 44,745 44,362 15.61% 13.73%
Power Generation (KWH) 23,55,22,319 23,55,22,319 25,83,30,603 25,83,30,603 -8.83% -8.83%

*Sales include captive consumption also.

The Company has considered internal and external sources of information up to date of approval of these financial statements in evaluating possible effects that may result from the pandemic relating to Covid-19 on the carrying amounts of trade and unbilled receivables, investments, goodwill and intangible assets. The Company is confident about the recoverability of these assets.

There is no change in the nature of the business of the Company. Disclosure of financial statement of Associate Company M/s. Gallantt Metal Limited has been provided in the prescribed format as a part of this Report. There were no significant and material orders passed by regulators or courts or tribunals impacting the going concern status and Companys operations in future. Factory had been working efficiently during the year. Safety measures and processes have been installed and improved upon at the plants and work sites. There are no material changes or commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of this Report.

Due to nationwide lockdown declared by the Government of India, manufacturing and sales operations were shut down in late March, 2020 and partially resumed in the month of April and became fully operational from start of June, 2020 which has impacted Companys operations during the months of March, April and May, 2020. The Companys Agro Businesses, being in the essential category, remained operational. The overall demands of the steel products have been impacted but due to easing out of restriction in lockdown demand for the products are improving.

COVID 19 STEPS TAKEN BY THE COMPANY

In view of the lockdown across the country due to the COVID-19 pandemic, manufacturing operations of the Company across all its locations were suspended temporarily during March and April-2020, in compliance with the directives/orders issued by the relevant authorities. The consolidated financial results for the year ended March 31, 2021 were impacted by disruptions owing to COVID 19. The Company has made an assessment of the recoverability and carrying values of its assets comprising property, plant and equipment, inventories, receivables and other current / non-current assets as of 31 March 2021 and on the basis of evaluation, has concluded that no material adjustments are required in the financial results. The Company is taking all the necessary steps and precautionary measures to ensure smooth functioning of its operations and to ensure the safety and well-being of all its employees. Given the criticalities associated with nature, condition and duration of COVID-19, the impact assessment on the Companys financial statements will be continuously made and provided for as required.

Your company stands by the society and community in times of despair. Apart from the above, the company has distributed wheat and other food items at the Gorakhpur (Head Office) and adjacent and nearby areas especially at villages nearby its plant. The company has also supplied face masks and sanitizers to these villages.

The company strictly follows all precautions and guidelines prescribed by the Government particularly towards adhering to safety measures in respect of its employees.

DIVIDEND

In view of conserving resources of the Company for future plan and to strengthen its fund and liquid position, Directors are unable to recommend any dividend.

Securities and Exchange Board of India (SEBI), vide its notification dated 8 July, 2016, has amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), introducing new Regulation 43A mandating the top 500 listed entities, based on market Capitalization calculated as on 31st March of every Financial Year, to formulate a Dividend Distribution Policy and disclose the same in their Annual Reports and on their websites (www.gallantt.com).

Accordingly, the Board of the Company has adopted a Dividend Distribution Policy, which is available on the website of the Company i.e.www.gallantt.com under "Investors Corner" and the same is annexed as ANNEXURE-I.

DISCLOSURE ON COMPLIANCE WITH SECRETARIAL STANDARDS

Your Directors confirm that the Secretarial Standards issued by the Institute of Company Secretaries of India, have been complied with.

SHARE CAPITAL

As on 31st March 2021, the authorized capital of the Company was Rs 49,88,50,000/- (Rupees Forty-Nine Crores Eighty-Eight Lakhs Fifty Thousand only) and the paid-upcapital stands at Rs 28,23,60,720/- (Rupees Twenty- Eight Crores Twenty-Three Lakhs Sixty Thousand Seven Hundred and Twenty only) consisting of 28,23,60,720 equity shares of Rs 1/- (Rupee One) each. There was no change in share capital of the Company during the financial year under review.

During the year under review, the company has not issued shares with differential voting rights nor has granted any stock options or sweat equity. As on March 31, 2021, none of the Directors of the company hold instruments convertible into equity shares of the Company. The Company has paid Listing Fees for the financial year 2021-22 to each of the Stock Exchanges, where its equity shares are listed.

BUSINESS GROWTH AND OUTLOOK

Your Company has a dedicated team of Management and Operating Personnel who have been instrumental in the growth of the business over the years. Your Directors believe that the Company has the potential to further scale up its business volumes and profitability and are in the process of identifying new avenues of growth and effective utilization of its existing resources. The infrastructure creation continues to be one of the major priorities of the State Governments as well as Government of India and thereby the infrastructure space is likely to see significant activity which augurs well for steel demand.

DIRECTORS RESPONSIBILITY STATEMENT

Based on the framework of Internal Financial Controls and compliance systems established and maintained by the Company, the work performed by the Internal, Statutory, Cost and Secretarial Auditors including Audit of Internal Financial Controls over financial reporting by the Statutory Auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companys Internal Financial Controls were adequate and effective during the financial year 2020-21.

Accordingly, pursuant to Section 134(3)(c) and 134(5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that:

i. In the preparation of annual accounts, the applicable accounting standards have been followed and there has been no material departure.

ii. The selected accounting policies were applied consistently and the Directors 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 as at 31st March, 2021 and of the profit of the Company for the financial year ended 31st March, 2021.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. The annual accounts have been prepared on a going concern basis.

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

vi. Proper systems to ensure compliance with the provisions of all applicable laws have been devised and such systems were adequate and operating effectively.

FINANCE AND ACCOUNTS

As mandated by the Ministry of Corporate Affairs, IND AS is applicable to the Company from the Financial Year commencing from April 01, 2017. The estimates and judgments relating to the Financial Statements are made on a prudent basis, so as to reflect in a true and fair manner, the form and substance of transactions and reasonably present the Companys state of affairs, profits and cash flows for the year ended March 31, 2021. Financial Statement has been prepared as per applicable Ind-AS.

CHANGE IN THE NATURE OF BUSINESS, IF ANY

There is no change in the nature of the business of the Company.

LISTING INFORMATION

The Equity Shares in the Company are in dematerialized form and is listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. The Listing Fee has been paid to the Stock Exchanges for the year 2021-22. The ISIN No. of the Company is INE528K01029.

CREDIT RATING

During the year under report, vide its rating letter dated September 04, 2020, the Rating agency M/s. Brickwork Ratings India Private Limited has upgraded and assigned BWR A- rating for the Companys Fund Based Long Term facilities (long term) and BWR A2+ for Non-Fund based Short Term facilities. Rating is assigned under watch with developing implications.

PUBLIC DEPOSITS

The Company has not accepted or renewed any public deposits during the period under review. It has not accepted any deposits from the public within the meaning of the provisions of Section 73 of the Companies Act, 2013 and Rules made there under. Therefore, it is not required to furnish information in respect of outstanding deposits under non- banking, non-financial Companies (Reserve Bank) Directions, 1966 and Companies (Accounts) Rules, 2014.

DEBENTURES

During the financial year under review, the Company has not issued or allowed any Debentures and does not have any outstanding Debentures.

AUDITORS & AUDITORS REPORT

The Board of Directors, based on the recommendation of the Audit Committee, has appointed of M/s. Maroti & Associates, Chartered Accountants (Firm Registration Number 322770E), 1209, Ansal Tower Nehru Place, New Delhi-110019 as the Statutory Auditors of the Company to hold office from the conclusion of the 15th AGM till the conclusion of the 20th AGM. The said appointment was approved at the last 15th AGM. M/s. Maroti & Associates, Chartered Accountants have consented to act as Auditors if appointed and have also confirmed that their appointment will be in accordance with Section 139 read with Section 141 of the Act. The notes on accounts referred to the Auditors Report are self-explanatory and therefore, do not call for any further explanation.

Necessary certificate has been obtained from the Auditors as per Section 139(1) of the Companies Act, 2013. The notes on accounts referred to the Auditors Report are self-explanatory and therefore, do not call for any further explanation.

The Auditors Report is annexed hereto and forms part of the Annual Report. The Auditors report does not contain any qualifications, reservations or adverse remarks.

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

The information required under section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is annexed as ANNEXURE-II to this Directors report.

DISCLOSURE REGARDING ISSUE OF SWEAT EQUITY SHARES AND EQUITY SHARES WITH DIFFERENTIAL RIGHTS

The Company has not issued any Sweat Equity Shares or Equity Shares with Differential Rights during the financial year.

DISCLOSURE IN RESPECT OF VOTING RIGHTS NOT EXERCISED

No disclosure is required under Section 67 of the Companies Act, 2013 read with Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014, in respect of voting rights not exercised directly by the employees of the Company as the provisions of the said Section are not applicable.

COST AUDIT

The Company has submitted the Cost Audit Report and Cost Compliance Report for the year 2019-20 duly certified by a Cost Accountant to the Central Government within the due date. M/s. U. Tiwari & Associates, Cost Accountants were appointed with the approval of the Central Government to carry out the cost audit in respect of the Company for the financial year 2020-21.

In terms of the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, as amended from time to time, the Board of Directors, based on the recommendation of the Audit Committee, has appointed M/s. U. Tiwari & Associates, Cost Accountants, as Cost Auditor of the Company for conducting the Cost Audit for the financial year 2021-22 on a remuneration of Rs 55,000/- plus out of pocket expenses.

A Certificate from M/s. U. Tiwari & Associates, Cost Accountants, has been received to the effect that their appointment as Cost Auditor of the Company, if made, would be in accordance with the limits specified under Section 141 of the Act and Rules framed thereunder.

The remuneration is subject to the ratification of the Members in terms of Section 148 read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014.

The Company has received consent from M/s. U. Tiwari & Associates, Cost Accountants, to act as the Cost Auditor for conducting audit of the cost records for the financial year 2021-22 along with a certificate confirming their independence and arms length relationship. Company has made and maintained the cost records pursuant to the Companies (Cost Records and Audit) Rules, 2014, as prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013.

INSURANCE

All the insurable interests of your Company including inventories, buildings, plant and machinery and liabilities under legislative enactments are adequately insured.

INTERNAL COMPLAINT REGARDING SEXUAL HARASSMENT

There were no cases of sexual harassment of woman at work place. Also, there are no instances of child labour/ forced labour/ involuntary labour and discriminatory employment during the year.

BOARD COMMITTEES

Details of Audit Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee, Risk Management Committee and Committee of Directors have been disclosed under Corporate Governance Report. Board of Directors has reconstituted all the above Committees and the same has been disclosed under Corporate Governance Report.

DETAILS OF RECOMMENDATIONS OF AUDIT COMMITTEE WHICH WERE NOT ACCEPTED BY THE BOARD ALONG WITH REASONS

The same is not applicable as the Audit Committees recommendations were accepted and implemented by the Board.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under section 197(12) read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith as ANNEXURE-III to this report.

A statement comprising the names of top 10 employees in terms of remuneration drawn is given in this report as ANNEXURE-III.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The particulars of loans, guarantees and investments u/s 186 of the Companies Act, 2013 is annexed herewith as ANNEXURE-IV.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORT

As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Management Discussion and Analysis report is part of the Annual Report and is annexed herewith as ANNEXURE-V.

A report on Corporate Governance together with the Auditors Certificate regarding the compliance of conditions of Corporate Governance is part of the Annual Report.

MARKET AND FUTURE PROSPECTS

Please refer to Management Discussion & Analysis Report which forms part of the Annual Report.

DETAILS OF POLICIES

(i) Nomination and Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The summary of Remuneration Policy of the Company prepared in accordance with the provisions of Section 178 of the Companies Act, 2013 read with Part D of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are provided in the Corporate Governance Report. The Remuneration Policy is uploaded on the website of the Company. The web link to the Remuneration Policy is as under: https://www.gallantt.com/Investors Corner/

Gallantt Ispat Limited/Nomination and Remuneration Policy/Remuneration Criteria Non-Executive Director w.e.f. 01.04.2019.

(ii) Corporate Social Responsibility Policy (CSR)

The Board has, on the recommendation of the CSR Committee, approved the CSR Policy. The Companys CSR Policy is available on the Companys website www.gallantt.com and the same is also attached herewith as ANNEXURE - VI.

As a part of its initiative under the "Corporate Social Responsibility" (CSR) drive, the Company has undertaken projects in the area of Health, Education and rural development, eradicating hunger, promoting health care and education. These projects are in accordance with Schedule VII of the Companies Act, 2013 and the Companys CSR policy. Annual Report on CSR as required under Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is also attached herewith as ANNEXURE-VII.

(iii) Risk Management Policy

Business Risk Evaluation and Management is an ongoing process within the Organization. Pursuant to Section 134(3)(n) of the Companies Act, 2013, the Board has framed a Risk Management Policy for the Company. The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the business and functions are systematically addressed through mitigating actions on a continuing basis. At present the company has not identified any element of risk which may threaten the business (or) existence of the company.

Company has formulated a policy on Risk Management. The Policy is formulated in compliance with Regulation 17(9)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations") and provisions of the Companies Act, 2013 ("the Act"), which requires the Company to lay down procedures about risk assessment and risk minimization.

The web link to the Risk Management Policy is as under:https://www.gallantt.com/InvestorsCorner/ Gallantt Ispat Limited/ Risk Management Policy w.e.f. 01.04.2019.

(iv) Whistle Blower Policy - Vigil Mechanism

Your Company has formulated a Vigil Mechanism Policy with a view to provide a mechanism for employees and directors of the Company to approach the Chairman of the Audit Committee to ensure adequate safeguards against victimisation.

This policy would help to create an environment where in individuals feel free and secure to raise an alarm, whenever any fraudulent activity takes place or is likely to take place. It will also ensure that complainant(s) are protected from retribution, whether within or outside the organization. The Board has elected Mr. Nitesh Kumar, Company Secretary as the Whistle Officer under the Vigil Mechanism Policy.

The details of establishment of the Vigil Mechanism Policy are displayed on the website of the Company www. gallantt.com under the link: https://www.gallantt.com/ Investors Corner/Gallantt Ispat Limited/ Whistle Blower Policy w.e.f. 01.04.2019.

SECRETARIAL AUDITORS

Mr. Anurag Fatehpuria, Practising Company Secretary, having office address at 23/1, Sita Nath Bose Lane, Salkia Howrah, Pin-711101 has been appointed as Secretarial Auditors of the Company for the FY ended 31st March, 2021. The Secretarial Audit Report received from the Secretarial Auditors is annexed to this report marked as ANNEXURE-VIII and forms part of this report.

ANNUAL EVALUATION OF BOARD, COMMITTEES AND INDIVIDUAL DIRECTORS

During the financial year, formal annual evaluation of the Board, its committees and individual Directors was carried out pursuant to the Board Performance Evaluation Policy of the Company.

The performance of the Board and committees was evaluated after seeking inputs from all the Directors on the basis of the criteria such as Board/ committee constitutions, frequency of meetings, effectiveness of processes etc. The performance of individual Directors (including Independent Directors) was evaluated by the Board and Nomination & Remuneration Committee (excluding the Director being evaluated) after seeking inputs from all Directors on the basis of the criteria such as thought contribution, business in sights and applied knowledge.

The criteria for the performance evaluation of the Board of Directors includes aspects such as its composition and structure, and the effectiveness of its processes, information flow and functioning. The criteria for the performance evaluation of individual Directors includes aspects, such as the Directors contribution to the Board of Directors and Committee meetings, including preparation on the issues to be discussed as well as meaningful and constructive contribution and inputs during meetings. In addition, the Chairperson is evaluated on the key aspects of his role.

The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings etc. The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings etc.

A separate meeting of Independent Directors was also held to review the performance of Managing Director, performance of the Board as a whole and performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors.

FAMILIARISATION PROGRAMME

Your Company follows a structured orientation and familiarization programme through various reports/ codes/internal policies for all the Directors with a view to update them on the Companys policies and procedures on a regular basis.

Periodic presentations are made at the Board Meetings on business and performance, long term strategy, initiatives and risks involved.

All the Board members of the Company are afforded every opportunity to familiarize themselves with the Company, its management, its operations and industry perspective on a regular basis. They are made to interact with senior management personnel and proactively provided with relevant news, views and updates on the Company and sector. All the information/documents sought by them is/are also shared with them for enabling a good understanding of the Company, its various operations and the industry. The Directors were apprised on key aspects of operations and market trend and the Companys performance and its future projects. The details of programmes for familiarisation for Independent Directors are posted on the website of the Company at www.gallantt.com under the Investors Corner of Gallantt Ispat Limited under the link: https://www.gallantt.com/ Investors Corner/ Gallantt Ispat Limited/Famaliarization Programme Imparted.

CODE OF CONDUCT

Your Company has adopted a Code of Conduct for members of the Board (incorporating duties of Independent Directors) and the Senior Management. The Code aims at ensuring consistent standards of conduct and ethical business practices across the Company. Your Company has received confirmations from all concerned regarding their adherence to the said Code.

Pursuant to Regulation 17(5) of the Securities & Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, Mr. C.P. Agrawal, Chairman & Managing Director and Mr. Mayank Agrawal, Chief Executive Officer confirmed compliance with the Code by all members of the Board and the Senior Management.

The full text of the Code is hosted on the Companys website www.gallantt.com under the Investors Corner of Gallantt Ispat Limited under the link: https://www. gallantt.com/Investors Corner/ Gallantt Ispat Limited/ Code of Conduct of BOD-w.e.f. 01.04.2019.

CODE OF CONDUCT FOR PROHIBITION OF INSIDER TRADING

Your Company has adopted a Code of Conduct for Prevention of Insider Trading and Code of Practices and procedures for Fair Disclosure of Unpublished Price Sensitive Information (hereinafter referred to as the "Code of Conduct" as per Securities and Exchange Board of India (SEBI) (Prohibition of Insider Trading) Regulations, 2015. All Directors, Designated Employees who could have access to the Unpublished Price Sensitive Information of the Company are governed by the Code. During the year under review, there has been due compliance with SEBI (Prohibition of Insider Trading) Regulations, 2015. The full text of the Code is hosted on the Companys website www.gallantt.com under the Investors Corner of Gallantt Ispat Limited under the link: https://www.gallantt.com/ Investors Corner/ Gallantt Ispat Limited/ Code of Conduct of Insider Trading-w.e.f. 01.04.2019.

NUMBER OF MEETINGS OF BOARD AND AUDIT COMMITTEE HELD DURING THE YEAR 2020-2021

Seven (7) meetings of the Board of Directors of the Company were conducted during the financial year and also Seven (7) meetings of the Audit Committee of the Board of Directors were conducted during the financial year. The details of board/committee/shareholders meetings are provided under the Corporate Governance Report which forms part of the Annual Report.

AUDIT COMMITTEE

The Audit committee of the Company as on the date of this report is constituted of following Directors:

Names Designation Category
Mrs. Smita Modi Chairperson Independent
Mrs. Sangeeta Upadhyay Member Independent
Mr. Prem Prakash Agrawal Member Executive

Constitution of the Audit Committee is in compliance with requisite provisions of the Companies Act, 2013 and rules made thereunder, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and all other applicable laws, rules and regulations.

STAKEHOLDERS RELATIONSHIP COMMITTEE

The Stakeholders Relationship Committee of the Company as on the date of this report is constituted of following Directors:

Names Designation Category
Mrs. Sangeeta Upadhyay Chairperson Independent
Mrs. Smita Modi Member Independent
Mr. Prem Prakash Agrawal Member Executive

Constitution of the Stakeholder Relationship is in compliance with requisite provisions of the Companies Act, 2013 and rules made thereunder, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and all other applicable laws, rules and regulations.

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee of the Company as on the date of this report is constituted of following Directors:

Names Designation Category
Mrs. Sangeeta Upadhyay Chairperson Independent
Mrs. Smita Modi Member Independent
Mr. Ashtbhuja Prasad Srivastava Member Independent

Constitution of the Nomination and Remuneration Committee is in compliance with requisite provisions of the Companies Act, 2013 and rules made thereunder, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and all other applicable laws, rules and regulations.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Corporate Social Responsibility Committee of the Company as on the date of this report is constituted of following Directors:

Names Designation Category
Mr. Prem Prakash Agrawal Chairperson Executive
Mr. Chandra Prakash Agrawal Member Executive
Mrs. Smita Modi Member Independent

Constitution of the Nomination and Remuneration Committee is in compliance with requisite provisions of the Companies Act, 2013 and rules made thereunder, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and all other applicable laws, rules and regulations.

COMMITTEE OF DIRECTORS

At their meeting held on June 29, 2020, the Board of Directors has constituted a Committee of Directors with nomenclature of "Committee of Directors". The Committee of Directors has the following composition of members as on the date of this report and is constituted of following Directors:

Names Designation Category
Mr. Chandra Prakash Agrawal Chairperson Executive
Mr. Prem Prakash Agrawal Member Executive
Mr. Nitin Mahavir Prasad Kandoi Member Executive

RISK MANAGEMENT COMMITTEE

In compliance with the requirements of Regulation 21 of the SEBI LODR, Board of Directors of the Company, at its meeting held on June 29, 2021, has constituted the Risk Management Committee with the following Directors:

Names Designation Category
Mr. Udit Agarwal Chairperson Independent
Mr. Ashtbhuja Prasad Srivastava Member Independent
Mr. Nitin Mahavir Prasad Kandoi Member Executive

REPORT ON PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

Pursuant to the provisions of Section 129(3) of the Act, a statement containing performance & salient features of the financial statements of Companys associate / Wholly Owned Subsidiaries in Form AOC-1 is attached as ANNEXURE-IX. The Company has two Wholly Owned Subsidiaries viz., Gallantt Industry Private Limited and Gallantt Udhyog Private Limited. Gallantt Metal Limited is an Associate of the Company.

The accounts of the Associate Company and Wholly Owned Subsidiaries are audited and certified by their respective Statutory Auditors for consolidation.

In accordance with Section 136 of the Act, the financial statements of the Associate Companies and Wholly Owned

Subsidiaries are available for inspection by the members at the Registered Office of the Company during business hours on all days except Saturdays, Sundays and public holidays upto the date of the AGM. Any member desirous of obtaining a copy ofthe said financial statements may write to the Company Secretary at the Registered Office of the Company. The financial statements including the CFS, and all other documents required to be attached to this report have been uploaded on the website of the Company at www.gallantt.com.

COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANYS SUBSIDIARIES, JOINT VENTURES ORASSOCIATE COMPANIES DURING THE YEAR

The Company has acquired two Wholly Owned Subsidiaries viz., Gallantt Industry Private Limited and Gallantt Udhyog Private Limited. Company did not have joint ventures. In terms of the Regulation 46(2)(h) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the policy for determining material subsidiaries is placed on the website of the Company at www.gallantt.com under Investors Corner of Gallantt Ispat Limited. Gallantt Metal Limited is an Associate of the Company.

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

There are no significant material orders passed by the Regulators or Courts or Tribunal which would impact the going concern status of the Company and its future operations. However, Members attention is drawn to the statement on contingent liabilities, commitments in the notes forming part of the Financial Statements.

DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM

The Company has formulated a Whistle Blower Policy to establish a vigil mechanism for Directors and employees of the Company to report concerns about unethical behaviour, actual or suspected fraud or violation of the Companys code of conduct or ethics policy. The Whistle Blower Policy is available on the website of the Company. The details of establishment of the Vigil Mechanism Policy is displayed on the website of the Company www.gallantt. com under the link: https://www.gallantt.com/Investors Corner/ Gallantt Ispat Limited/ Whistle Blower Policy w.e.f. 01.04.2019.

CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility Committee and has framed a Corporate Social Responsibility Policy and identified Healthcare, Childrens education, as some of the key areas. The

Company will continue to support social projects that are consistent with the policy.

Corporate Social Responsibility Committee of the Company is constituted of:

Mr. Prem Prakash Agrawal, Chairman,

Mr. Chandra Prakash Agrawal and

Mrs. Smita Modi

KEY MANAGERIAL PERSONNEL

The following are the whole-time key managerial personnel of the Company:

SI. No. Name Designation
1 Mr. Chandra Prakash Agrawal Chairman and Managing Director
2 Mr. Prem Prakash Agrawal Whole-time Director
3 Mr. Santosh Kumar Agrawal Whole-time Director
4 Mr. Nitin Mahavir Prasad Kandoi Whole-time Director
5 Mr. Mayank Agrawal Chief Executive Officer
6 Mr. Amit Jalan Chief Financial Officer
7 Mr. Nitesh Kumar Company Secretary

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Ind - AS on Consolidated Financial Statements read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Consolidated Audited Financial Statements and Consolidated Cash Flow Statement for the year ended March 31, 2020 are provided in the Annual Report. A statement containing the salient feature of the financial statements of each of the subsidiary and Associate Company in the prescribed Form AOC-1 is annexed ANNEXURE-IX.

Pursuant to Section 136 of the Act, the financial statements of the subsidiary and Associate Companies are kept for inspection by the shareholders at the Registered Office of the Company. The Company shall provide free of cost, the copy of the financial statements of its subsidiary and Associate companies to the shareholders upon their request. The statements are also available on the website of the Company www.gallantt.com

COVID 19 STEPS TAKEN BY THE COMPANY

Your company stands by the society and community in times of despair. Apart from the above, the company has distributed wheat and other food items at the Gorakhpur and adjacent and nearby areas especially at villages nearby its plant. The company has also supplied face masks and sanitizers and free meal to these villages. The company strictly follows all precautions and guidelines prescribed by the Government particularly towards adhering to safety measures in respect of its employees.

BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report for the financial year, as stipulated under Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is part of the Annual Report and is attached as

ANNEXURE - X.

EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of section 92(3) of the Act, the details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as ANNEXURE-XI.

RISK MANAGEMENT

Risk management is embedded in your Companys operating framework. Your Company believes that managing risks helps in maximizing returns. The Companys approach to addressing business risks is comprehensive and includes periodic review of such risks and a framework for mitigating controls and reporting mechanism of such risks. The risk management framework is reviewed periodically by the Board and the Audit Committee. Some of the risks that the Company is exposed to are:

Key Risk Impact to Gallantt Ispat Limited Mitigation Plans
Commodity Price Risk Risk of price Fluctuation on basic raw materials like Iron Ore, Coal, Chemicals, Scraps as well as finished goods used in the process of manufacturing. The Company commands excellent business relationship with the business associates. In case of major fluctuation either upwards or downwards, the matter will be mutually discussed and compensated both ways. Also by focusing on new value added products helps in lowering the impact of price fluctuation in finished goods.
Uncertain global economic environment - slow growth in global economy Impact on raw materials which are imported We have internal procedure to mitigate the global adverse impact.
Interest Rate Risk Any increase in interest rate can affect the finance cost Any increase in interest rate can affect the finance cost. Dependence on debt is very minimum and we have surplus funds cushion to settle the entire debt in case the need arises. Further, the Company has repaid the Term Loan infull.
Foreign Exchange Risk Your company does not have export sales. However, import raw materials from country outside India. Any volatility in the currency market can impact the overall profitability. The Company commands excellent business relationship with the sellers and suppliers. In case of major fluctuation either upwards or downwards, the matter will be mutually discussed and compensated both ways.
Human Resources Risk Your Companys ability to deliver value is dependent on its ability to attract, retain and nurture talent. Attrition and non availability of the required talent resource can affect the overall performance of the Company. By continuously benchmarking of the best HR practices across the industry and carrying out necessary improvements to attract and retain the best talent. Also recruitment is across almost all states of India which helps to mitigate this risk and we do not anticipate any major issue for the coming five years.
Competition Risk Your company is always exposed to competition Risk from Steel and Ago Manufacturers across the region. The increase in competition can create pressure on margins, market share etc. By continuous efforts to enhance the brand image of the Company, quality, Cost, timely delivery and customer service.
Compliance Risk - Increasing regulatory requirements Any default can attract penal provisions By regularly monitoring and review of changes in regulatory framework. By monitoring of compliance through legal compliance Management tools and regular internal audit and secretarial audit.
Industrial Safety, Employee Health and Safety Risk The Steel and Agro industry is labour intensive and are exposed to accidents, health and injury risk due to machinery breakdown, human negligence etc. By development and implementation of critical safety standards across the various departments of the factory, establishing training need identification at each level of employee.
Cyber Security Risk With the growing instances of cyber attacks, data security has become a challenge. Confidential information has been enhanced by implementing best-in-class firewalls. The Company is aware about the current elevated levels of cyber security risks across the globe. All critical IT servers are protected with best-inclass firewalls which are monitored and updated regularly.
Key Risk Impact to Gallantt Ispat Limited Mitigation Plans
All access to critical IT servers, including SAP ERP, for those working remotely, are allowed through security authentication tunnel. Necessary update patches and security policies are pushed over the internet to all computers of the Company on a daily basis, even if the user is at home or away from office. Deviations and alerts are monitored closely and corrective/ preventive actions are implemented as per need. The Risk Management Committee looks into the monitoring and reviewing of the risk management plan and such other functions, as it may deem fit and such function specifically covers cyber security.

Following amount of Unpaid Dividend has not been claimed and paid till 31.03.2021:

Nature of Money Relevant Financial Year Bank Account Details Amount lying (In Rs.)
Final Dividend for 2014 2013-14 IDBI Bank Account No. 0135103000007900 3,282.50
Final Dividend for 2015 2014-15 IDBI Bank Account No. 0135103000008587 3,427.00
Interim Dividend 2016 2015-16 ICICI Bank Account No. 001105026007 3,929.00
Final Dividend for 2017 2016-17 IDBI Bank Account No. 1526103000000347 12,765.50
Final Dividend for 2018 2017-18 IDBI Bank Account No. 1526103000000569 21,063.00
Final Dividend for 2018-19 (Interim Dividend) 2018-19 IDBI Bank Account No. 1526103000000666 23,761.75

Unclaimed and unpaid amount of Dividend for the Financial Year 2012-13 to the tune of Rs 17,666 were transferred to the Investors Education and Protection Fund. Members who have not so far encashed their Divided Warrants for the financial years ended 31st March 2014, 2015, 2016 (Interim), 2017, 2018 and 2019 (Interim) are requested to approach immediately the Registrars for revalidation of unclaimed Dividend Warrants. The details of unclaimed dividend are available on the Companys corporate website www.gallantt.com and also uploaded on the website of IEPF viz. www.iepf.gov.in

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

a) Transfer of Unclaimed Dividend to IEPF:

As required under Section 124 of the Act, the Unclaimed Dividend amount aggregating to Rs 17,666/- pertaining to the financial year ended on 31st March, 2013 lying with the Company for a period of seven years were transferred during the Financial Year 2020-21, to the Investor Education and Protection Fund established by the Central Government.

b) Transfer of shares to IEPF:

As required under Section 124 of the Companies Act, 2013, 881 Equity Shares, in respect of which dividend has not been claimed by the members for seven consecutive years or more have been transferred by the Company to the Investor Education and Protection Fund Authority (IEPF) during the financial year 2020-21. Details of shares transferred have been uploaded on the website of IEPF as well as the Company.

BOARD OF DIRECTORS AND SENIOR EXECUTIVE

The Board of Directors comprises of Eight Directors of which four are Independent. In terms Section 152 of the Companies Act, 2013, Mr. Prem Prakash Agrawal, liable to retire by rotation at the ensuing Annual General Meeting is eligible for re-election.

Mr. Ashtbhuja Prasad Srivastava (DIN: 08434115), Mrs. Sangeeta Upadhyay (DIN: 06920195), Mrs. Smita Modi (DIN: 01141396) and Mr. Dindayal Jalan (DIN: 00006882) are Independent Directors of the Company. Presently, Company has optimum combination of Executive, NonExecutive and Independent Directors on the Board of the Company.

Mr. Dindayal Jalan (DIN: 00006882) has tendered his resignation from the Directorship of the Company with effect from April 12, 2021. The Board has placed on record its deep appreciation for the invaluable support and guidance received from Mr. Dindayal Jalan during his association as a Non-Executive Independent Director of the Company.

Independent Directors are appointed for five consecutive years and are not liable to retire by rotation in terms of Sections 149, 152, Schedule IV and other applicable provisions, if any, of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014. Mr. Mayank Agrawal is a Chief Executive Officer of the Company as per the provisions of the Companies Act, 2013. Mr. Amit Jalan is Chief Financial Officer and is inter alia looking after the core finance function of the Company. Mr. Nitesh Kumar is working in the capacity of Company Secretary and Compliance Officer.

None of the Directors of your Company is disqualified under the provisions of Section 164(2)(a) & (b) of the Companies Act, 2013 and a certificate dated June 29, 2021 received from Company Secretary in Practice certifying that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of the Companies by SEBI/Ministry of Corporate Affairs or any such statutory authority is annexed to the Corporate Governance Report. All Independent Directors 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 (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, Independent Director shall get themselves registered with the Independent Directors Databank as per the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019.

Mr. Udit Agrawal (DIN:07036864) has been appointed as an Additional Independent Director on the Board of the Company effective from June 29, 2021. His appointment shall be affirmed by the Shareholders in the ensuing Annual General Meeting of the Company. The Company has received notices u/s 160 of the Act from a Member of the Company signifying his intention to propose the candidature of Mr. Udit Agrawal (DIN:07036864) for the office of the Director of the Company.

The Policy on Directors appointment and remuneration, including the criteria for determining the qualifications, positive attributes and independence of Directors forms a part of the Corporate Governance Section of the Annual Report.

Presently, Company has optimum combination of Executive, Non-Executive and Independent Directors on the Board of the Company.

KEY FINANCIAL RATIOS

Key Financial Ratios for the financial year ended 31st March, 2021, are provided in the Management Discussion and Analysis Report given in Annexure - V, which is annexed hereto and forms a part of the Boards Report.

KEY MANAGERIAL PERSONNEL (KMP) WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR

During the year there were no changes in the KMP. However, on April 12, 2021 Mr. Dindayal Jalan (DIN: 00006882), Independent Director has tendered his resignation from the Board of the Company. Further, Mr. Udit Agarwal (DIN: 07036864) has been appointed as an Additional Independent Director of the Company. Details pertaining to their remuneration of KMPs have been provided in the Extract of Annual Return annexed hereto and forming part of this Report.

TRANSFER TO RESERVES

Your Directors has not proposed to transfer net earnings for the period to the General Reserve.

RELATED PARTY TRANSACTIONS

The details of Related Party Transactions during the Financial Year ending 31st March 2021, being arms length transactions have been reported in the financial statements and forms part of this report. The Audit Committee and the Board of Directors of the Company have formulated the Policy on dealing with RPTs and a Policy on materiality of RPTs which is uploaded on the website of the Company and can be accessed through the website of the Company www.gallantt.com under the Investors Corner of Gallantt Ispat Limited.

All transactions entered with Related Parties for the year under review were on arms length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 and the Rules made thereunder are not attracted. Thus, disclosure in form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. The Company has developed a framework through Standard Operating Procedures for the purpose of identification and monitoring of such Related Party Transactions.

All Related Party Transactions are placed before the Audit Committee as also to the Board for approval. Omnibus approval was obtained on a yearly basis for transactions which are of repetitive nature. Transactions entered into pursuant to omnibus approval are audited by the Audit Committee and a statement giving details of all Related Party Transactions are placed before the Audit Committee and the Board for review and approval on a quarterly basis.

The policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company viz. www.gallantt.com. None of the Directors has any pecuniary relationship or transactions vis-a-vis the Company.

PERSONNEL, INDUSTRIAL RELATIONS AND MARKETING

The Companys HR philosophy is to establish and build a high performing organization, where each individual is motivated to perform to the fullest capacity: to contribute to developing and achieving individual excellence and departmental objectives and continuously improve performance to realize the full potential of our personnel. Industrial relations have remained harmonious throughout the year.

DECLARATION OF INDEPENDENCE

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules issued there under as well as Securities & Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

AWARD AND RECOGNITIONS

During the year and during previous years Company/ Management has received following awards, accolades and reconciliation:

During previous years:

• Udyami Samman 2011: Awarded by Zee Media House and was presented by Shri Prakash Jaiswal, Honble Coal Minister, Government of India.

• Udyami Samman 2013: Awarded by Sahara Samay Media House and was presented by Shri Akhilesh Yadav, Honble Chief Minister of U.P

• Promoter of Gallantt Group Mr. C.P Agrawal & family has been listed on Indias Super Rich List at 188th position in 2014 by the Business World Magazine.

• Gems of Purvanchal: Jagran Coffee Table Book has given a place to our promoter Shri. C.P. Agrawal by stating "MAKING A MARK WITH BUSINESS IN STEEL".

• Shri Yogi Adityanath Maharaj Ji, C.M. of U.P., honoured the company for Entrepreneur of the Region during Gorakhpur Mahotsav 2018.

• The Top Challengers Award 2018: awarded by the Construction World Magazine, a world famous magazine.

• The Gallant Men: Steel 360, a renowned magazine of steel industry felicitated the group and its promoters in its cover story May, 2018.

• Ranked at 6th position among the top 10 mid-size rebar producers in India by Steel 360 magazine in August, 2018 edition.

• Listed "200 BEST UNDER A BILLION COMPANIES" in Forbes Asia Magazine, July/August 2019 edition.

• Group Chairman, Shri Chandra Prakash Agrawal Ji was felicitated with momento for his significant and imperishable contributions to the Industrial development in the State, by Shri Yogi Adityanath Maharaj Ji, C.M.of U.P on the eve of U.P. Diwas Mahotsav, in January, 2020.

During the year:

• Industry outlook Magazine recognised Gallantt under "TOP 10 TMT IRON & STEEL MANUFACTURES 2021".

MATERIAL CHANGES AND COMMITMENTS

There have been no material changes and commitments affecting the financial position of the Company since the close of financial year i.e. since 31st March, 2021 till the date of this Report. Further, it is hereby confirmed that there has been no change in the nature of business of the Company. However, after approval of the Scheme of Amalgamation as above all the assets and liabilities of the Transferor Companies shall be transferred to the Company. Significant and material orders passed by the regulators / courts / tribunals impacting the going concern status and the Companys operations in future.

As such there is no significant and material order by the regulator/court/tribunals impacting the going concern status and the Companys operation in future.

GENERAL

a) Your Company has not issued equity shares with differential rights as to dividend, voting or otherwise; and

b) Your Company does not have any ESOP scheme for its employees/Directors.

CHANGE IN SHARE CAPITAL

There are no changes in the Share Capital during the year. INTERNAL FINANCIAL CONTROLS

The Company has an adequate system of internal controls in place. It has documented policies and procedures covering all financial and operating functions. These controls have been designed to provide a reasonable assurance with regard to maintaining of proper accounting controls for ensuring reliability of financial reporting, monitoring of operations, and protecting assets from unauthorized use or losses, compliances with regulations.

The Company has continued its efforts to align all its processes and controls with global best practices.

The framework on Internal Financial Controls over Financial Reporting has been reviewed by the internal and external auditors. The Companys internal financial controls were operating effectively based on the internal control criteria established by the Company considering the essential components of internal control stated in the guidance note on audit of internal control over financial reporting issued by the Institute of Chartered Accountants of India.

The Audit committee of the Board of Directors actively reviews the adequacy and effectiveness of internal control systems and suggests improvements wherever needed to strengthen the same. The Audit Committee evaluated the internal financial controls based on the following criteria:

1. Systems have been laid to ensure that all transactions are executed in accordance with managements general and specific authorisation. There are well-laid manuals for such general or specific authorisation.

2. Systems and procedures exist to ensure that all transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles or any other criteria applicable to such statements, and to maintain accountability for aspects and the timely preparation of reliable financial information.

3. Access to assets is permitted only in accordance with managements general and specific authorisation. No assets of the Company are allowed to be used for personal purposes, except in accordance with terms of employment or except as specifically permitted.

4. The existing assets of the Company are verified / checked at reasonable intervals and appropriate action is taken with respect to any differences, if any.

5. Proper systems are in place for prevention and detection of frauds and errors and for ensuring adherence to the Companys policies.

A report on the internal financial controls under clause (i) of sub-section 3 of Section 143 of the Companies Act, 2013 issued by M/s. Maroti & Associates, Chartered Accountants, Statutory Auditors of the Company is attached with their Independent Auditors report and the same is self-explanatory.

Effective steps are taken by the Management to enable continuous monitoring of lead control indicators and action taken towards correcting identified gaps. Respective functions have been trained and equipped to enable continuous monitoring of exceptions by themselves to reduce surprises and enable corrective action on timely and regular basis.

Your Company has a robust financial closure self certification mechanism wherein the line managers certify adherence to various accounting policies, accounting hygiene and accuracy of provisions and other estimates.

PARTICULARS OF LOANS/ADVANCES/INVESTMENTS AS REQUIRED UNDER SCHEDULE V OF THE LISTING REGULATIONS

The details of related party disclosures with respect to loans/advances/investments at the year end and maximum outstanding amount thereof during the year as required under Part A of Schedule V of the Listing Regulations have been provided in the notes to the Financial Statements of the Company.

FRAUD REPORTING

There have been no frauds reported by the Auditors of the Company to the Audit Committee or the Board of Directors under sub-section (12) of section 143 of the Companies Act, 2013 during the financial year.

ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safe operations. The Companys policy requires conduct of operations in such a manner so as to ensure safety of all concerned, compliances of environmental regulations and preservation of natural resources.

TRANSFER OF SHARES COMPULSORILY IN DEMAT MODE

As per amended Regulation 40(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 amended vide SEBI Notification No. SEBI/LADNRO/GN/2018/24 dated June 2018, effective from December 5, 2018; securities of the listed companies can be transferred (except in case of transmission or transposition) only in the dematerialized form.

In case any of the Shareholders have any queries or need any assistance in this regard, please contact;

GALLANTT ISPAT LIMITED Registrar & Share Transfer Agent
Regd. Office Address: Niche Technologies Pvt. Ltd.
"GALLANTT HOUSE", I-7, Jangpura Extension, 7th Floor, Room, No. 7A & 7B, 3A, Auckland Rd, Elgin,
New Delhi - 110014 Kolkata, West Bengal - 700017
Telefax: 011-41645392 Tel.: (033) 2280 6616 /17 / 18
Email-Id: nitesh@gallantt.com Email id: nichetechpl@nichetechpl.com
Website: www.gallantt.com Website: www.nichetechpl.com

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

Procedure for Nomination and Appointment of Directors: The Nomination and Remuneration Committee (NRC) has been mandated to oversee and develop competency requirements for the Board based on the industry requirements and business strategy of the Company. The NRC reviews and evaluates the resumes of potential candidates for appointment of Directors and meets them prior to making recommendations of their nomination to the Board. Specific requirements for the position, including expert knowledge expected, are communicated to the appointee.

On the recommendation of the NRC, the Board has adopted and framed a Remuneration Policy for the Directors, Key Managerial Personnel and other employees pursuant to the provisions of the Act and the Listing Regulations. The remuneration determined for Executive/Independent Directors is subject to the recommendation of the Nomination and Remuneration Committee and approval of the Board of Directors. The Non-Executive Independent Directors and Non-Executive Non-Independent Directors are compensated by way of sitting fees for attending meetings of the Board and its Committees. The Executive Directors are not paid sitting fees; the Non-Executive Directors are entitled to sitting fees for attending the Board/Committee Meetings.

It is affirmed that the remuneration paid to Directors, Key Managerial Personnel and all other employees is in accordance with the Remuneration Policy of the Company. The Companys Policy on Directors Appointment and Remuneration and other matters provided in Section 178(3) of the Act and Regulation 19 of the Listing Regulations have been disclosed in the Corporate Governance Report, which forms part of the Annual Report.

EMPLOYEES WELFARE

The Company continues to focus on welfare and improving the quality of lives of its employees by providing educational assistance to their children, employee wellness sessions, periodic occupational health checks, spiritual peace by yoga classes, creche and child care facilities, transport facilities to employees at subsidized rate or at no charge.

AMALGAMATION OF COMPANIES

At their meeting held on January 18, 2020, Board of Directors of the Company has approved the Scheme of Amalgamation and Slump Sale providing for the Amalgamation of Gallantt Ispat Limited (Transferor Company No. 1 or GIL), AAR Commercial Company Limited (Transferor Company No. 2 or AAR), Hipoline Commerce Private Limited (Transferor Company No. 3 or HIPOLINE), Lexi Exports Private Limited (Transferor Company No. 4 or LEXI) and Richie Credit and Finance Private Limited (Transferor Company No. 5 or RICHIE) (together referred to as the "Transferor Companies") with Gallantt Metal Limited ("Transferee Company" or "GML") and for the Slump Sale of 18 MW Power Plant Undertakings of Gallantt Ispat Limited to the Transferee Company and their respective shareholders and Creditors (Scheme") under Section 230 to 232 and other applicable provisions of the Companies Act, 2013.

In accordance with the Regulation 37 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as the "LODR") Company had filed the draft Scheme of Amalgamation and Slump Sale with the BSE Limited (formerly Bombay Stock Exchange Limited) and the National Stock Exchange of India Limited (hereinafter together referred to as the "Stock Exchanges") for obtaining an observation letter or a no-objection letter, before filing such scheme. Further, Transferor Company No. 1, Transferor Company No. 2 and the Transferee Company had also filed this application with the Stock Exchanges under Regulation 37 of LODR.

Brief details of the Scheme are as under:

1. GIL, AAR, HIPOLINE, LEXI and RICHIE all are TRANSFEROR COMPANIES and GML is TRANSFEREE COMPANY.

2. The Transferee Company is a listed Company, GIL and AAR are also Listed Companies.

3. Upon the Scheme becoming effective in lieu of the amalgamation no consideration will be due to the Transferor Companies and in consideration of the amalgamation of the Transferor Companies with the Transferee Company pursuant to the Scheme including the consequential extinguishment of the shareholding in Transferor Companies, the Transferee Company shall without further application, issue and allot as given below equity shares in the Transferee Company to the equity shareholders of the Transferor Companies whose names appear in the Register of Members of the Transferor Companies on the Record Date:

• 13 (Thirteen) equity shares of the nominal value of Rs. 10/- fully paid up in the Transferee Company for every 14 (Fourteen) equity shares of Rs 1/- each fully paid up held by such member in GIL.

• 5 (Five) equity shares of the nominal value of Rs 10/- fully paid up in the Transferee Company for every 1 (One) equity share of Rs 10/- each fully paid up held by such member in AAR.

• 9 (Nine) equity shares of the nominal value of Rs 10/- fully paid up in the Transferee Company for every 2 (Two) equity shares of Rs 10/- each fully paid up held by such member in HIPOLINE.

• 84 (Eighty-Four) equity shares of the nominal value of Rs 10/- fully paid up in the Transferee Company for every 1 (One) equity share of Rs 10/- each fully paid up held by such member in LEXI.

• 101 (One Hundred One) equity shares of the nominal value of Rs 10/- fully paid up in the Transferee Company for every 2 (Two) equity shares of Rs 10/- each fully paid up held by such member in RICHIE.

4. Transferor Companies GIL and AAR and Transferee Company GML are under the Jurisdiction of the Registrar of Companies, Delhi and Haryana and Transferor Companies, HIPOLINE, LEXI and RICHIE are under the jurisdiction of the Registrar of Companies, West Bengal.

5. Pursuant to the Scheme 18 MW Power Plant Undertakings of GIL will be sold and transferred to the Transferee Company through Slump Sale at a consideration of Rs. 35 Crores payable in cash.

6. "Appointed Date of Slump Sale" means the open of business hours on 1st April 2019

7. "Appointed Date" means the open of business hours on 1st April 2019 after the completion of the slump sale.

Company has appointed BSE Limited as designated Stock Exchange for coordinating with the SEBI in respect of the said Scheme and matters connected therewith.

Vide its letters dated November 12, 2020 and November 23, 2020, BSE Limited and National Stock Exchange of India Limited respectively have issued Observation letters (hereinafter referred to as the "Observation Letters").

Post getting the observation Letters as above, Companies filed application with the Honorable National Company Law Tribunal, Principal Bench, New Delhi (hereinafter referred to as the "NCLT Delhi") together with other petitioner Companies viz., AAR and GIL for directions to hold meetings of the Shareholders and Creditors of the Companies. Further, the Petitioner Companies Hipoline, LEXI and Richie, falling under the jurisdiction of Honorable Company Law Tribunal, Kolkata Bench (hereinafter referred to as the "NCLT Kolkata"), have filed application along with necessary enclosures for dispensation of the meeting of Shareholders and Creditors.

Pursuant to the application filed as above, NCLT Kolkata, vide its order dated January 19, 2021 has dispensed the meetings of shareholders and creditors. Further, NCLT Delhi, vide its order dated February 26, 2021, has directed to convene and hold meetings of shareholders and creditors of GML, GIL and AAR ON April 08, 2021. The Chairman has appointed Mr. Somnath Gangopadhyay and the Chairperson and Ms. Aisha Amin as Alternate Chairperson. Further, Mr. Tanmay Kumar Saha was appointed as the Scrutinizer of the meetings.

In accordance with the NCLT Delhi Order and provisions of

(i) Section 230(4) read with Section 108 of the Act and read with Rule 20 of the Companies (Management and Administration) Rules, 2014 as amended;

(ii) Rule 6(3) (xi) of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016;

(iii) Regulation 44 and other applicable provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended ("Listing Regulations"); and

(iv) Secretarial Standards-2 on General Meetings issued by Institute of Company Secretaries of India, as applicable, the Company has engaged the services of National Securities Depository Limited ("NSDL") for the purpose of providing facility of remote e-voting prior to the Meeting and e-voting during the Meeting, so as to enable the equity shareholders, to consider and if thought fit, approve the Scheme by way of requisite majority. Accordingly, voting by equity shareholders, secured creditors and unsecured creditors of the Company were carried out through

(a) remote e-voting prior to the Meeting, and

(b) e-voting during the Meeting. Remote e-voting prior to the Meeting was opened during the period commencing from 9.00 a.m. (IST) on Monday, April 05, 2021 and ending at 5.00 p.m. (IST) on Wednesday, April 07, 2021, arranged by NSDL.

The members (including public shareholders), secured creditors and unsecured creditors passed the resolution for approval of the Scheme with the requisite majority. After approval of the resolution by the shareholders, secured and unsecured creditors, the Companies complied with the requisite formalities and filed petition with the NCLT Delhi for their approval and order of the Scheme. Similarly, Other Petitioner Companies viz., Hipoline, Lexi and Richie have also filed petition with the NCLT Kolkata Bench for approval of the Scheme by the NCLT Kolkata Bench.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of Companies Act, 2013 (hereinafter referred to as "the Act"), Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "Listing Regulations") and applicable Accounting Standards, the Audited Consolidated Financial Statements of the Company for the financial year 2020-21, together with the AuditorsReport form part of this Annual Report.

OTHER DISCLOSURES

• The Managing Director & CEO of the Company has not received any remuneration or commission from any of the subsidiary companies;

• None of the Auditors of the Company have reported any fraud as specified under the second proviso of Section 143 (12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force);

• The Company does not have any scheme or provision of money for the purchase of its own shares by employees/ Directors or by trustees for the benefit of employees/ Directors; and

• The Company has not issued equity shares with differential rights as to dividend, voting or otherwise.

• In the preparation of financial statements, no treatment different from that prescribed in an Accounting Standard has been followed.

ACKNOWLEDGEMENT

Your Directors wish to convey their appreciation to all of the Companys employees for their contribution towards the Companys performance. Your Directors would also like to thank the shareholders, employee unions, customers, dealers, suppliers, bankers, Governments and all other business associates for their continuous support to the Company and their confidence in its management on behalf of the Board.

For Gallantt Ispat Limited
Date: July 29, 2021 C. P. Agrawal
Place: Gorakhpur Chairman