IFGL Refractories Ltd Directors Report.


Management Discussion and Analysis Report

Dear Shareholders,

Your Directors are happy to present Statement of Accounts, both on Consolidated and Standalone basis, for Financial Year (FY) 2020-21 together with Report of the Auditors forming part thereof, of your Company.

Financial Results

Summary of Financial Results achieved for FY 2020-21 is as follows :

Revenue from Operations 10,219.45 6,490.74
Other Income 205.04 67.70
Total Income 10,424.49 6,558.44
Profit before Depreciation, Interest and Tax (PBDIT) 1,758.59 1,429.49
Depreciation and Amortisation 485.79 392.89
Finance Cost 30.58 23.59
Profit before Tax 1,242.22 1,013.01
Tax Expense 586.31 564.69
Profit for the year after Tax 655.91 448.32
Other Comprehensive Income/(Loss) for the year, Net of Tax 159.54 2.73
Total Comprehensive Income for the year 815.45 451.05
Basic and Diluted Earnings per Share 18.20 12.44
Basic and Diluted Earnings per Share (Adjusted) 23.80 18.04
Disclosures under Regulations 34 (3) read with Clause B of Schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (SEBI LODR, 2015)
i) Debtors Turnover Ratio 4.7:1 4.6:1
ii) Inventory Turnover Ratio 3.1:1 3.5:1
iii) Interest Coverage Ratio 41.6:1 43.9:1
iv) Current Ratio 3.2:1 2.9:1
v) Debt Equity Ratio 0.1 0.1
vi) Operating Profit Margin (%) 10.4% 14.9%
vii) Net Profit Margin (%) 6.4% 6.9%
viii) Return on Net Worth (%) 7.4% 8.0%

Despite disruptions caused by COVID-19 pandemic and the resultant lockdown enforced by respective authorities, your Company has achieved its best ever financial results, both on consolidated and standalone basis, for FY 2020-21. Compared to FY 2019-20, Total Income, Profit before Tax and Profit after Tax on Consolidated basis for FY 2020-21 are higher by 12.30%, 314.51% and 237.11% respectively. On Standalone basis, Total Income, Profit before Tax and Profit after Tax for FY 2020-21 are higher by 29.44%, 183.22% and 50.78% respectively. Return on Net Worth on Consolidated and Standalone basis has improved by 4.96% and 2.24% respectively because of costs rationalization and other measures for improving efficiency taken by the Management added by factors favorable to Steel Industry. Both on Consolidated and Standalone basis, your Company continued to be Net Debt free. As on 31st March 2021, Cash and Cash Equivalents including Investments (both Current and Non-Current and excluding Investment in wholly owned subsidiary) on Consolidated and Standalone basis aggregated to 3,219.13 millions and 1,745.12 millions respectively. EPS both on Consolidated and Standalone basis have improved substantially. EPS without considering one time Deferred Tax Charge is even better at 23.80 and 18.04 respectively.

During FY 2020-21 the world experienced and still is experiencing, a pandemic which can only be compared with the Spanish Flue (1918-20). Most countries imposed a lockdown at varying degrees bringing the economies at an all-time low as against a projection of 2.9% for 2020 the year ended with a negative world domestic product of (3.5%). Similarly for India FY 2020-21 closed with a (7.3%) GDP. The IMF has projected a global growth at 6% in FY 2020-21 moderating to 4.4% in FY 2021-22. The Reserve Bank of India has projected the Indian economy to grow at 9.5% in FY 2021-22. Despite the above scenario, Steel production was 1.83 billion tonnes, similar to that of 2019. World Steel Association has projected this to grow to 1.87 billion tonnes in 2021 and 1.92 billion tonnes in 2022.

Dividend Declaration

Based on the record results achieved and in keeping with the Dividend Declaration Policy, your Directors have recommend a Dividend of 40% i.e. 4/- per Equity Share and one time Special Dividend of 60% i.e 6/- per Equity Share making it a total of 100% i.e. 10/- per Equity Share. This is subject to (a) your approval at ensuing Annual General Meeting (AGM) and (b) deduction of Tax at Source.

Industry Review, Future Outlook and Expansion Plans and Impact of COVID-19

All the manufacturing facilities of your Company including its subsidiaries operated satisfactorily barring intermittent disruptions, amidst various safety measures and safeguards adopted to combat COVID-19. During the recent months India experienced second wave of COVID which is now showing signs of coming under control. Your Directors along with the management teams including in the Subsidiaries ensured the impact of COVID_19 was contained in the minimum level. Regrettably we had 2 fatalities. During FY 2020-21, construction activities at the green field site in Visakhapatnam, India for manufacture of products like Monolithic and Precast Shapes continued with minimum interruption. First phase will get completed latest by June 2021 and trial production will be started soon thereafter.

To fuel further growth, your Directors are continuing to look for inorganic opportunities in India and abroad.There is adequate cash support to finance any opportunity that may arise.


Performance of Companys subsidiaries for FY 2020-21 were satisfactory including the German subsidiary and hopefully such trend will continue in the future too. Total Revenue and PBT on consolidated basis for FY 2020-21 of Companys immediate subsidiary IFGL Worldwide Holdings Ltd, is lower by 5.45% and higher by 738.59% respectively than those of immediately preceding FY 2019-20.

Business Responsibility Report

Your Directors adopted Business Responsibility Policy at their meeting held on 18th July 2020, a copy of which is hosted on Companys website: www.ifglref.com. Business Responsibility Report (BRR) having details of initiatives taken by the Company from Environmental, Social and Governance perspectives in format specified for FY 2020-21 as per Regulation 34(2)(f) of SEBI LODR 2015 is annexed hereto as

Annexure ‘A.

Corporate Governance/Vigil Mechanism etc

Report on Corporate Governance (CG Report) and Report of the Statutory Auditors thereon form part of this Report and are annexed as Annexure ‘B. CG Report conforms to provisions of Regulation 34 of the SEBI LODR, 2015, amended to date and notifications, circulars, clarifications etc issued by SEBI from time to time.

Policies including Vigil Mechanism (Whistle Blower), Prevention of Sexual Harassment, Insider Trading and Risks Management etc commensurate to nature and size of business of the Company are in place. They are reviewed and updated from time to time. These Policies have been hosted on the Companys website www.ifglref.com. During FY 2020-21, no complaint and or alert was received either under Vigil Mechanism (Whistle Blower) or for Sexual Harassment. Internal Complaints Committees following provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 are also in place and functioning.


Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, Annual Return in the prescribed format has been hosted on the Companys website www.ifglref.com. Information regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in Annexure ‘C. During FY 2020-21, the Company entered into transactions with related parties in ordinary course of its business at arms length. Hence, Form AOC-2 has not been annexed herewith with details of those transactions. During FY 2020-21, the Company did not give loans and guarantees or made investments under Section 186 of the Companies Act, 2013 (the Act). Evaluation of performance of the Companys Board of Directors and its Committees and Individual Directors including Independent Directors and Chairman of Board has been carried out. Outcome of such evaluation is that the Board and its Committees continued to function satisfactorily and flow of information has been commensurate to the nature of business and size of your Company. From time to time, Directors received briefings on key matters including regulatory, which improved their performance.

Following Announcement of Quarterly and Annual Results, the Company made quarterly presentations, conference calls and interactions, resulting in enhanced confidence of Investors in the Company. As on 31st March 2021, 12.73% of the Companys equity shares was held by Mutual Funds. A statement in Form AOC-1 having financial information of Subsidiary Companies form part of this Report as Annexure‘D. The Company does not have any Indian Subsidiary. Shareholders of the Company who are desirous of having complete Statement of Accounts and related detailed information of Subsidiary Companies, may send their request therefor to the Companys Registered Office. They are available for inspection electronically to the members during working hours on working days (excluding Saturday) provided prior request therefor is sent at investorcomplaints@ifgl.in and are also available on Companys website: www.ifglref.com.

Information including those to be provided following Section 134(3) of the Act read with relevant provisions of the Companies (Accounts) Rules, 2014 and Regulations 34 of SEBI LODR, 2015 have been included in Annexures hereto including Audited Financial Statements and Notes and have not been reproduced herein again. During FY 2020-21, the Company neither invited nor accepted Deposits.

Particulars of meetings of the Board of Directors and Committees held during FY 2020-21 and attendance are given in CG Report. Between end of FY 2020-21 and date of this Report, there has been no material changes and/or commitments, affecting financial position of the Company. There have also not been any Order(s) passed by the Regulators or Courts or Tribunals likely to impact going concern status or operations in future of the Company. Your Board of Directors in their meeting held to-day, 5th June 2021, have constituted Risk Management Committee comprising of Managing Director, Mr P Bajoria, Director and Chief Financial Officer, Mr K Sarda and Independent Director, Mr D K Banerji. In this meeting, Dividend Distribution Policy has also been approved and adopted by your Board of Directors and copy of the same is available on website of the Company www.ifglref.com.

Following Regulation 17(8) read with Part B of Schedule II of SEBI LODR, 2015, Certificate on Financial Statements has been received from Managing Director and Director and Chief Financial Officer of the Company.

The Company review checks and balances for IT security and take steps to strengthen the same from time to time, irrespective of instances of hacking and/or breaches reported in public domain.

Directors Responsibility Statement

Your Directors state that :

a) in preparation of Annual Accounts, applicable Accounting Standards have been followed.

b) Accounting Policies selected and applied are consistent and judgments and estimates made 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 FY and of the Profit and Loss of the Company for that period.

c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with provisions of the Act for safeguarding the Assets of the Company and for preventing and detecting fraud and other irregularities.

d) the Annual Accounts have been prepared on a Going Concern basis.

e) Internal Financial Controls i.e. policies and procedures for ensuring orderly and efficient conduct of business, including adherence to Companys Policies, safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information, have been laid down and that such controls are adequate and operating effectively.

f) Proper systems to ensure compliance with provisions of all applicable laws have been devised and that such systems are adequate and operating effectively.

Financial Statements for FY 2020-21 have been audited in accordance with Generally Accepted Accounting Principles as indicated in Report of the Statutory Auditors.

CSR, Human Resource and Industrial Relations

CG Report include details of the Companys CSR Committee and Annual Report in compliance of Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is forming part of this Report as Annexure ‘E.

Particulars of Nomination and Remuneration Committee (NRC) have also been included in CG Report. Nomination and Remuneration Policy adopted by your Directors based on recommendation of NRC is hosted on the Companys website www.ifglref.com. Said Policy inter-alia provide for matters concerning Directors appointment and remuneration including criteria for determining qualifications, positive attributes, Independence of Directors and those provided in Section 178(3) of the Act. For the sake of brevity the Policy has not been reproduced here.

An Annexure having information following provisions of Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Report as Annexure ‘F.

During FY 2020-21, 4(four) persons (including Executive Directors) employed with the Company received remuneration of 102 lacs per annum or more or 8.50 lacs per month or more. As on 31st March 2021, the Company had employed 1049 people worldwide including 793 in India.

During FY 2020-21, Industrial Relations in the Company remained cordial. Working environment provided to employees was conducive. Trainings were imparted, which helped employees achieve skills befitting their roles and responsibilities ultimately resulting in increased productivity. Compensation packages and benefits provided have been comparable with those of the peers and continued to motivate employees at large.

Consolidated Financial Statements

In accordance with IND AS 110 and other relevant provisions particularly Section 129(3) of the Act, Consolidated Financial Statements duly audited by Statutory Auditors, M/s S R Batliboi & Co. LLP (Regd No. 301003E/E300005) form part of this Annual Report. Consolidated Financial Statements have been prepared considering Financial Statements of Subsidiary Companies and Reports of Auditors relating thereto.

Directors and Key Managerial Personnel (KMPs)

Particulars of the Companys Key Managerial Personnel, are appearing at Note 36 of Audited Statement of Accounts as per Section 203 of the Act. All Independent Directors have given their Statement of Declaration under Section 149(7) of the Act and continue to fulfil independence criteria and other conditions specified in the Act and SEBI LODR, 2015.

Managing Director, Mr P Bajoria (DIN: 00084031) will retire by rotation at ensuing AGM and being eligible, have offered himself for reappointment for further period liable to retire by rotation. Such re-appointment has been recommended by the NRC and Board of the Company. Mr Y Yamaguchi (DIN: 09047766) will cease to hold his office of Additional Director of the Company on conclusion of ensuing AGM. He being eligible, has offered himself for appointment as a Director of the Company liable to retire by rotation. Your Board and NRC have recommended the appointment of Mr Yamaguchi. Resolutions for aforesaid re-appointment/appointment and Explanatory Statement thereon wherever necessary and other details form part of Notice of AGM. The Directors recommend passing of said resolutions proposed being in the interest of the Company.

All of the Directors and Senior Management Personnel as on 31st March 2021 have confirmed compliance of Code of Conduct for Board of Directors including Independent Directors and Senior Management Personnel of the Company. This Code continues to help the Company maintain standard of ethics and ensure compliance of legal requirements applicable.

Cost Auditor

The Company maintained accounts and records during FY 2020-21 to the extent provisions of Section 148 of the Act applied. M/s Mani & Co., Practicing Cost Accountant have been re-appointed as Cost Auditors of the Company for FY 2021-22.Your approval for payment of remuneration not exceeding 3 lacs to them is being sought inasmuch as Ordinary Resolution has been included in Notice of forthcoming AGM.

Secretarial Auditor

Secretarial Audit Report in Form MR 3 following provisions of Section 204 of the Act of M/s S M Gupta & Co., Practicing Company Secretaries form part hereof as Annexure ‘G. Following Regulation 24A of SEBI LODR, 2015, Secretarial Auditor have also carried out Secretarial Compliance Audit for FY 2020-21. Both of said Report and Certificate are free of qualification, reservation or adverse remark.

Auditors Report and Auditors

Report of the Statutory Auditors, M/s S R Batliboi & Co. LLP (Regd No. 301003E/E300005), Chartered Accountants on statement of Accounts for FY 2020-21 on Standalone and Consolidated basis are self-explanatory. Their Reports have no qualification, reservation, adverse remark or disclaimer except 2(two) emphasis of matters. They have also not reported any fraud under Section 143(12) of the Act. Their appointment will come to an end on conclusion of 17th AGM and have confirmed that they continue to comply with all requirements and criteria specified and are qualified to act as Auditors of the Company.


Your Directors thank all concerned particularly you the Shareholders and all Stakeholders for your continued support during these unprecedented times.

On behalf of the Board of Directors

S K Bajoria P Bajoria
Chairman Managing Director
(DIN- 00084004) (DIN- 00084031)


5th June 2021