Inducto Steel Ltd Directors Report.


Dear Members,

The Board of Directors are pleased to present the Companys Thirty Second (32nd) Annual Report and the Companys Audited Financial Statements (Standalone and Consolidated) for the financial year ended March 31, 2020 ("year under review/ FY 2019-20").


To avoid repetition of information, the Management Discussion and Analysis on performance of the Company is presented below.

Global Overview:

The global steel industry faced a challenging CY 2019, as demand growth in a few markets was largely offset by declines in the rest of the world. An uncertain economic environment, coupled with continued trade tensions, slowdown in global manufacturing notably auto sector and intensifying geopolitical issues, weighed on investment and trade. Similarly, production growth was only visible in Asia and the Middle East and to some extent in the US, while the rest of the world witnessed a contraction.

The global steel industry faced pricing pressure for most parts of CY 2019, in the wake of a protective market environment in key economies, including the imposition of Section 232 in the US. This was further aggravated due to country-specific demand slowdown, that fuelled market imbalances. In line with a conservative trade sentiment, consumer industries of steel undertook active destocking. This led to stunted capacity utilisation and resulted in net excess capacity globally. This was further complemented by addition of new capacities and resulted in downward pressure on steel prices

Domestic Overview:

India is currently the 2nd largest producer of crude steel in the world. The steel industry has been one of the primary beneficiaries of Indias rapid economic growth over the past couple of decades. However, steel demand remained subdued in CY 2019, largely due to lower consumption from construction, auto, infrastructure, real estate, and manufacturing industries. Further, the slowdown in the governments infrastructure investments and credit tightness impacted demand and consequently weighed on pricing.

Market Size

India became the second-largest consumer of finished steel products in the world, surpassing the US in CY 2019. While the governments thrust on infrastructure development provided a boost, it was largely offset by the continued weakness in the auto and real estate sectors. Finished steel consumption grew by 1.4% to 100.01 MnT during FY 2019-20, non- alloy steel accounting for 94% (94.06 MnT) and the rest being alloy steel (5.95 MnT). Within the non-alloy, nonflat - segment, bars and rods consumption was up 9.6% y-o-y to 39.72 MnT, while the non-alloy flats were led by hot rolled coils (HRCs) which was 40.63 MnT, down by 2.7% during FY 2019-20.

Indias per capita steel consumption, which has a direct correlation with economic growth, grew at a CAGR of 4.12% to 68.9 kg between FY 2007-08 and FY 2017-18, driven by rapid growth in the industrial sector and robust infrastructure development (railways, roads and highways). However, compared with the global average of 208 kg, there exists a significant growth potential. Keeping this in mind, the National Steel Policy (NSP) was introduced in CY 2017 to increase per capita steel consumption to 160 kg byFY 2030-31. The NSP also set a target of achieving 300 MnT of production capacity, which translates into additional investments of 10 lakh crore (~US$ 156.08 billion).

Government Initiatives

One of the designated core industries, steel is key to the governments focus on driving growth in the infrastructure Segment. Towards this end, the following initiatives have been rolled out in support of the steel industry:

The National Infrastructure Pipeline (NIP) is a noteworthy government initiative, which holds tremendous promises for the steel sectors growth. The NIP announced an investment of 102 lakh crore by FY 2024-25, of which roads, energy and urbanisation will contribute 60% of the total infrastructure build. For FY 2020-21, infrastructure spending is estimated at 19.5 lakh crore, up 43% from 13.5 lakh crore for FY 2019-20. Implemented Steel Import Monitoring System (SIMS), which aids in monitoring real- time import data on quantity, quality and value; the system helps detect misclassification and mis-declaration regarding over/ underinvoicing, - preventing import of defective steel

Imposed anti-dumping duty on galvalume products, ranging from US$ 28-200/tonne; imports from China, South Korea and Vietnam are subject to duties.

To ensure iron ore availability for domestic manufacturing, it introduced a 30% export duty on export of high grade iron ore (lumps and fines).

Other measures are underway like the proposed steel scrap policy, safety codes, proposal to reduce royalty to 5% on low grade iron ore fines; Remission of Duties or

Taxes on Export Products (RoDTEP) to replace existing Merchandise Export from India Scheme (MEIS); and engagement with international agencies to promote steel intensive design for roads, bridges and commercial and residential housing.

Standalone Ind AS Financial Results : Review and Analysis

(Rs. In Lakhs)

Particular For the financial year ended 31.03.2020 For the financial year ended 31.03.2019
Revenue from operations 4557.48 7583.41
Other Income 181.96 19.66
Total Revenue 4739.44 7603.07
Cost of raw materials consumed 4347.03 2581.73
Purchase of Stock – in – trade - 4272.44
Changes in inventories of finished goods, 75.60 (44.25)
stock – in – trade, work – in – process
Employee benefits expenses 112.69 100.27
Finance costs 7.74 85.37
Depreciation and amortization expenses 17.50 15.16
Other expenses 155.10 516.02
Total Expenses 4715.65 7526.76
Profit / (Loss) before tax 23.79 76.31
Less: Current Tax 2.04 36.44
Less: Deferred Tax 4.38 (2.82)
Profit / (Loss) after tax 17.37 42.69
Other Comprehensive Income 1.62 0.34
Total Comprehensive Income for the 18.99 43.03
Earnings Per Share (Face Value of Rs.
10/- each)
Basic - 0.43 1.06
- Diluted 0.43 1.06

Standalone Cash Flow Analysis

(Rs. In Lakhs)

Particular For the financial year ended For the financial year ended
31.03.2020 31.03.2019
Net Cash Flow from Operating Activities 402.82 (237.68)
Net Cash Outflow from Investing Activities (404.60) 329.83
Net Cash Outflow from Financing Activities (7.74) (85.37)
Net Cash Inflow/(Outflow) (9.51) 6.78

The company is in the business of ship breaking, trading and investment activities. The sales turnover of the company for FY 2019-20 and FY 2018-19 were Rs. 4557.48 Lakhs and Rs. 7583.41 Lakhs respectively. In spite of frequent fluctuation in the prices of old ship in the international market and also heavy dollar exchange rate fluctuations, the company was able to perform well in terms of sales turnover. However, the prices in Iron and steel industry are gradually getting stabilized, but foreign currency and fluctuations in value of Indian Rupee vis--vis US Dollar remains a concerning area for the company even in the current year.

Whenever, there is no immediate payment liability against old ship purchased for breaking, the surplus funds available with the Company are given as loan on short term basis. The Company is hopeful that the Company can earn reasonable return on these loans/investments Surplus funds are also invested in new avenues of earnings in the form of partnership with other entities like in Real Estate and Redeveloping firms. At present the Company has partnership with M/s. Calvin Divine Enterprises with 20% share and M/s. Shree Balaji Associates with 5% share. The management is hopeful that the Company can earn reasonable return on these investments.

Operating Profit (EBITDA)

The Operating Profit of the Company, including finance cost and depreciation is Rs. 49.03 Lakhs (previous year Rs.176.85 Lakhs).

Finance Cost

Finance cost during the year under review has decreased to Rs. 7.74 lakhs as compared to the previous year which amounted to Rs. 85.37 Lakhs during the year under review.


Depreciation during the year increased to Rs. 17.50 lakhs from Rs. 15.16 lakhs as compared to previous year due to addition in fixed assets.

Consolidated Ind AS Financial Results : Review and Analysis

(Rs. In Lakhs)

Particular For the financial year ended 31.03.2020 For the financial year ended 31.03.2019
Revenue from operations 4557.48 7583.41
Other Income 181.96 19.66
Total Revenue 4739.44 7603.07
Cost of raw materials consumed 4347.03 2581.73
Purchase of Stock – in – trade - 4272.44
Changes in inventories of finished goods, stock – in – trade, work – in – process 75.60 (44.25)
Employee benefits expenses 112.69 100.27
Finance costs 7.74 85.37
Depreciation and amortization expenses 17.50 15.16
Other expenses 155.10 516.02
Total Expenses 4715.65 7526.76
Profit / (Loss) before tax 23.79 76.31
Less: Current Tax 2.04 36.44
Less: Deferred Tax 4.38 (2.82)
Profit / (Loss) after tax 17.37 42.69
Other Comprehensive Income 1.62 0.34
Total Comprehensive Income for the year 18.99 43.03
Earnings Per Share (Face Value of Rs. 10/- each)
Basic - 0.43 1.06
- Diluted 0.43 1.06

Segmental Review

The companys business segments are identified based on the geographic locations of its units and the internal business reporting system as per Ind AS 108. Business segments of the company are primarily categorized as: Mumbai (Trading & Investment) and Bhavnagar (Ship Breaking & Trading).

Segment-wise Standalone Ind AS Financial Results

(Rs. In Lakhs)

Particulars Mumbai Bhavnagar Total
Revenue from External Source 0 4557.48 4557.48
Segment Results Before Interest and Taxes 39.99 (8.46) 31.53
Segment Assets 3467.10 718.75 4185.85
Segment Liabilities 15.57 11.14 26.71

i. Bhavnagar:

During the financial year 2019-20, ship-breaking unit at Alang Ship Breaking Yard, Bhavnagar has performed well in term of sales turnover and net profit margin. In spite of volatile prices of old Ships, Iron and Steel products coupled with fluctuations in value of Indian Rupee vis--vis US Dollar during the year, this segment has achieved revenue of Rs. 4557.48 Lakhs and result of Rs. (8.46) Lakhs. Though the year under review saw fluctuation in the international market of old ships coming for breaking, the management was very cautious and purchased ships at proper time and built a good level of inventories to earn better profits in coming years. During the year under review, Trading activities were also carried out in Bhavnagar. Moreover, the management is of the view that, in the coming years the ship breaking industry will be stable and with expected boost in the economy the requirement of iron and steel will increase which will help the company to move towards its sustained path of growth.

ii. Mumbai:

During the year under review, the Mumbai Unit has not carried out any trading activities.

Industry Overview

Steel is crucial to the development of any modern economy and is considered to be the backbone of human civilization. The level of per capita consumption of steel is treated as an important index of the level of socio-economic development and living standards of the people in any country. It is a product of a large and technologically complex industry having strong forward and backward linkages in terms of material flows and income generation. All major industrial economies are characterized by the existence of a strong steel industry and the growth of many of these economies has been largely shaped by the strength of their steel industries in their initial stages of development.

Indias economic growth is contingent upon the growth of the Indian steel industry. Consumption of steel is taken to be an indicator of economic development. While steel continues to have a stronghold in traditional sectors such as construction, housing and ground transportation, special steels are increasingly being used in engineering industries such as power generation, petrochemicals and fertilizers. India occupies a central position on the global steel map, with the establishment of new state-of-the-art steel mills, acquisition of global scale capacities by players, continuous modernization and up gradation of older plants, improving energy efficiency and backward integration into global raw material sources.

Outlook – Way Forward

Just as CY 2020 started on a good note with the US and China reaching phase1 - agreement and uncertainty around Brexit waning, the world was hit hard by the COVID-19 pandemic. The outbreak of Coronavirus (COVID-19) pandemic globally and in India is causing a significant disruption and slowdown of economic activity. Measures taken o contain the spread of the virus, including travel bans, quarantines, social distancing and closures of non-essential services and the uncertainty associated with the lifting or reimposition of these restrictions, have further aggravated the business environment. As a result, the IMF expects the global economy to contract sharply by 3% in CY 2020, in a baseline scenario, which assumes that the pandemic fades in the second half of CY 2020 and containment efforts can be gradually unwound. The IMF expects the global economy to grow by 5.8 percent in CY 2021 as economic activity normalises, helped by policy support by way of fiscal and monetary stimulus. The recent PMI and IP prints unsurprisingly reflect plummeting economic activity across the US, EU and Japan. In China, economic activities are picking up from April 2020 onwards due to timely (and expected) fiscal and monetary measures which bodes well for the outlook for remainder of CY 2020. The synchronised policy measures across the globe, with about US$ 19 trillion (G-20 countries) of announcements (both monetary and fiscal), is expected to aid economic recovery. The partial lifting of lockdown restrictions is underway, and a possible re-emergence of contagion in such areas pose risks to the outlook. The phased easing of restrictions in India also augurs well for the economic revival. Further, India unleashed policy stimulus equivalent to 10% of GDP or 20 trillion to revive the economy. Workforce remobilisation will be a key challenge for the core sectors of the economy. However, lower energy prices and expectations of a normal monsoon are positive for consumption outlook. With this a gradual recovery in economic activities is expected in the second half of FY 2020-21.


As per applicable provisions of the Companies Act, 2013 ("the Act"), if any read with the Rules issued thereunder and in accordance with principles and procedures as set out in the Indian

Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015, the Consolidated Financial Statements of the Company for the financial year ended March 31, 2020 have been prepared.

The Consolidated Financial Statements together with the Auditors Report form part of this Annual Report.


In the last month of FY 2020, the COVID-19 pandemic developed rapidly into a global crisis, forcing governments to enforce lockdowns - of all economic activity. For the Company, the focus immediately shifted to ensuring the health and well-being of all employees, and on minimizing disruption to services for all our customers globally. As of March 31, 2020, work from home was enabled to work remotely and securely. This response has reinforced customer confidence and many of them have expressed their appreciation and gratitude for keeping their businesses running under most challenging conditions.

The novel coronavirus (COVID-19) has affected life and livelihood across the globe. By the last week of June 2020, over 9.2 million confirmed cases and over 4,70,000 deaths had been reported on account of COVID-19. The pandemic is estimated to have severely impacted both supply and demand sides of businesses. As production and global trade has been curtailed around the world, many sectors will experience shortage of inputs and a severe consumption slowdown.

Unprecedented global efforts to create a vaccination:

The race to find a vaccine for the new coronavirus is well underway. Governments and researchers are aiming to provide billions of people with immunity in eighteen months or less.


Your Directors have considered it financially prudent in the long term interest of the Company to reinvest the profits into the business of the Company, to build strong reserve base, meet the funds requirement and grow the business of the Company. Thus, your Board of Directors regrets their inability to recommend any dividend for the year ended March 31, 2020.


Your Directors do not propose to transfer any amount to the Reserves


The Companys Shares are listed on BSE Limited


The Companys Equity Shares have been admitted to the depository mechanism of the National Securities Depository Limited (NSDL) and also the Central Depository Services (India) Limited (CDSL). As a result the investors have an option to hold the shares of the Company in a dematerialized form in either of the two Depositories. The Company has been allotted ISIN No INE146H01018. Shareholders therefore are requested to take full benefit of the same and lodge their holdings with Depository Participants [DPs] with whom they have their Demat Accounts for getting their holdings in electronic form.


The Paid up Equity Share Capital, as at 31st March, 2020 was Rs. 40,172,540/- divided into 40,17,254 Equity shares, having face value of Rs. 10/- each fully paid up. During the year under review, the Company has neither issued any shares nor granted any stock options or sweat equity.


All the Independent Directors of the Company have given their respective declarations stating that they meet the criteria of Independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations and there has been no change in the circumstances which may affect their status as an independent director during the year. During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company.

Ms. Arpita Doshi (Mem No-A45554) an Associate Member of Institute of Company Secretaries of India), Company Secretary and Compliance Officer of the Company resigned with effect from May 31, 2019.

Ms. Rupali Rajkumar Somani (Mem No- A59561), an Associate Member of Institute of Company Secretaries of India, was appointed as the Company Secretary and Compliance Officer of the Company with effect from October 7th, 2019.

Further, the list of the present Directors and KMP forms part of this Annual Report under the section Company details.


During the year, 8 (Eight) Board meetings were held. The details of the composition of the Board and its Committees and of the meetings held and attendance of the Directors at such meetings are provided in the Corporate Governance Report.


Your Company treats its "human resources" as one of its most important assets.

We continuously invest in attraction, retention and development of talent on an ongoing basis. Our thrust is on the promotion of talent internally through job rotation and job enlargement. We believe in harnessing its leadership and people capabilities through sharp focus and initiatives on talent development.

We review our talent based on their performance and potential to assess their readiness for future roles of higher scale and complexity. We believe in developing our employees through multiple experiences requiring them to handle scale and complexity. We have instituted this through varied job rotation and project roles. We have put in place various recognition initiatives for our employees to reward them on their noteworthy performance and contribution.

Our Company is committed to providing work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment. The Company is also dedicated at promoting a work environment that is conducive to the professional growth of its employees and encourages equality of opportunity. To foster a positive workplace environment, free from harassment of any nature, we have institutionalized the Anti Sexual

Harassment Framework through which we address complaints of sexual harassment at the workplace. We follow a gender-neutral approach in handling complaints of sexual harassment and we are compliant with the law of the land where we operate. We have also constituted Complaints Committee to consider and address sexual harassment complaints in accordance with Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.


The Company has no subsidiary, associate companies or joint venture companies within the meaning of Section 2(6) and 2(87) of the Act and thus, pursuant to the provisions of Section 129(3) of the Act, the statement containing the salient features of financial statements of the Companys subsidiaries / associate companies in Form AOC-1 is not required to be attached to the financial statements of the Company.


The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ‘Meetings of the Board of Directors and ‘General Meetings, respectively, have been duly followed by the Company.


Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 as on March 31, 2020, if any, form part of the Notes to the Standalone Financial Statements provided in this Annual



Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, state that:

(i) in the preparation of the annual accounts for the financial year ended March 31, 2020, the applicable accounting standards and Schedule III of the Companies Act, 2013 have been followed and there are no material departures from the same;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2020 and of the profit and loss of the Company for the financial year ended March 31, 2020;

(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) proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and operating effectively;

(vi) proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems are adequate and operating effectively.


The Company is exposed to the risk from the market fluctuations of foreign exchange as well as the fluctuation in the price of iron and steel. The Companys raw material is old ship, which is purchased from the international market on credit ranging up to 180 days to 360 days. The Company is adopting policy of full hedging or covering the foreign exchange requirement, the Company is regularly monitoring the foreign exchange movement and suitable remedial measures are taken as and when felt necessary.

Though the Company is employing such measures, the Company is still exposed to the risk of any heavy foreign exchange fluctuation.

Likewise the Companys finished products are mainly re-rollable scrap generated from ship breaking and the price of the same is linked to the market rate for iron and steel. Any up and down in the price of the iron and steel will affect the profitability of the Company.


Internal financial control systems of the Company are commensurate with its size and nature of its operations. These have been designed to provide reasonable assurance with regard to 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 the timely preparation of reliable financial information and disclosures.

Systems and procedures are periodically reviewed and these are routinely tested by Statutory as well as Internal Auditors and cover all functions and business areas. The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems. During the year under review, no material or serious observation has been received from the Statutory Auditors and the Internal Auditors of the Company on the inefficiency or inadequacy of such controls.


As per the provisions of Section 188(1) of the Act read with Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 23 of the Listing Regulations, all contracts/arrangements/transactions entered by the Company with Related Parties were in ordinary course of business and at arms length basis.

All Related Party Transactions entered into during the year under review were approved by the Audit Committee and the Board, from time to time and the same are disclosed in the Financial Statements of your Company for the year under review.

Further, pursuant to the provisions of the Act and the SEBI Listing Regulations, the Board has, on recommendation of its Audit Committee, adopted a Policy on Related Party Transactions and the said policy is available on the website of the Company i.e. Further during the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. There were no materially significant related party transactions which could have potential conflict with interest of the Company at large.

Accordingly, Form AOC-2 prescribed under the provisions of Section 134(3)(h) of the Act and Rule 8 of the Companies (Accounts) Rules, 2014 for disclosure of details of Related Party Transactions which are "not at arms length basis" and also which are "material and at arms length basis", is not provided as an annexure to the Boards Report.


In terms of the provisions of the Act, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") and Nomination Policy of the Company, NARC and the Board have approved a framework, which lays down a structured approach, guidelines and processes to be adopted for carrying out an evaluation of the performance of the Board, its Committees and individual Directors.

During the year under review, the Board carried out the evaluation of its own performance and that of its Committees and the individual Directors.

The evaluation process focused on various aspects of the functioning of the Board and its Committees, such as composition of the Board and Committees, attendance of Directors at Board and committee meetings, acquaintance with business, communicating inter se board members, effective participation, domain knowledge, compliance with code of conduct, vision and strategy, experience and competencies, performance of specific duties and obligations, governance issues etc. The Board also carried out the evaluation of the performance of individual directors based on criteria such as contribution of the director at the meetings, strategic perspective or inputs regarding the growth and performance of the Company etc.



The Board carried out an annual performance evaluation of the Board, Committees, Individual Directors and the Chairman along with assessing the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties. The performance evaluation of the Board is carried out taking into account the various parameters like composition of Board, process of appointment to the Board, common understanding amongst Directors of their role and responsibilities, timelines and content of Board papers, strategic directions, advice and decision making, etc. The Board also notes the actions undertaken, pursuant to the outcome of previous evaluation exercises.

The performance evaluation of the Independent Directors was carried out by the entire Board excluding the independent director being evaluated.

The Chairman of the respective Committees shared the report on evaluation with the respective Committee members. The performance of each Committee was evaluated by the Board, based on report on evaluation received from respective Committees.

The report on performance evaluation of the Individual Directors was reviewed by the Chairman of the Board and feedback was given to Directors.

Committees of the Board:

The Committees selfassessment - is carried out based on degree of fulfillment of key responsibilities, adequacy of Committee composition, effectiveness of meetings, Committee dynamics and quality of relationship of the Committee with the Board and the Management. The Independent Director(s) also evaluated the performance of Non-Independent Directors, the Chairman of the Board and the Board as a whole at the meeting of Independent Director(s) held on November 14, 2019. The outcome and feedback from Directors was discussed at the respective meetings of Board, Committees of Board and meetings of Independent Directors.

The overall performance evaluation exercise was completed to the satisfaction of the Board. The Board of Directors deliberated on the outcome and necessary steps will be taken going forward.

The details of the evaluation process are set out in the Corporate Governance Report which forms a part of this Annual Report.


Audit Committee:

The composition of the Audit Committee is in alignment with provisions of Section 177 of the Companies Act, 2013 read with the Rules issued thereunder and Regulation 18 of the Listing Regulations.

All the recommendations made by the Audit Committee were accepted by the Board of Directors of the Company.

The details pertaining to Audit Committee and its composition are included in the Corporate Governance Report which forms part of this report.

Nomination And Remuneration Committee (‘Narc):

Your Company has a duly constituted NARC, with its composition, quorum, powers, role and scope in line with the applicable provisions of the Act and SEBI Listing Regulations. The detailed information with respect to the NARC is disclosed in the Corporate Governance Report forming part of this Annual Report.

Stakeholders Relationship & Share Transfer Committee:

The details pertaining to composition of the Committee is included in the Corporate Governance Report, which forms part of this report.

Corporate Social Responsibility Committee ("Csr Committee"):

In terms of the provisions of Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, your Company has a duly constituted CSR Committee comprising the following members:

Sr. No Name of Member Designation
1 Mr. Yogesh Thakkar Chairman
2 Mr. Bhushanlal Behl Member
3 Ms. Sweety Reniwal Member

Policy on Corporate Social Responsibility ("CSR")

The Board has, with a vision "to actively contribute to the social and economic development of the communities in which your Company operates and in doing so, build a better, sustainable way of life for the weaker sections of society and raise the countrys human development index", adopted a CSR Policy and the same is available on the website of the Company i.e.

The CSR Policy of the Company also mentions the process to be implemented with respect to the identification of projects and philosophy of the Company, alongwith key endeavors and goals i.e.

•  Education - to spark the desire for learning and knowledge;

• Health care - to render quality health care facilities to people living in the villages and elsewhere;

• Sustainable Livelihood - to provide livelihood in a locally appropriate and environmentally sustainable manner;

• Infrastructure Development - to set up essential services that form the foundation of sustainable development; and

•  Social Cause - to bring about the Social Change we advocate and support.

Corporate Social Responsibility (CSR) initiatives taken during the year

In terms of section 135 and Schedule VII of the Act, the Corporate Social Responsibility Committee (CSR Committee) has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board.

The CSR Policy may be accessed on the Companys website i.e., During the year under review, Corporate Social Responsibility is not applicable to the company


The extract of the Annual Return of the Company as on March 31, 2020 in Form MGT - 9 in accordance with Section 134(3)(a), Section 92 (3) of the Companies Act, 2013 read with Companies(Management and Administration) Rules, 2014, is appended as Annexure-I to the Boards Report.



A separate section on Corporate Governance forming part of the Boards Report is annexed as Annexure-II to the Boards Report.


Your Company is committed to follow the best practices of Corporate Governance and the Board is responsible to ensure the same, from time to time.

Your Company has duly complied with the Corporate Governance requirements as set out under Chapter IV of the SEBI Listing Regulations, from time to time and the Statutory Auditors of the Company, vide their certificate dated 09th July, 2020 confirmed that the Company is and has been compliant with the conditions stipulated in the Chapter IV of the SEBI Listing Regulations. The said certificate is annexed as Annexure-III to this Report.


Joint Statutory Auditors

M/s. P. D. Goplani & Associates, Chartered Accountants, Bhavnagar, having ICAI Firm Registration No. 118023W, were appointed as Auditors of the Company, at the Annual General Meeting held on September 30, 2017, for a term of 5 (five) consecutive years i.e. to hold office from the conclusion of 29th Annual General Meeting until the conclusion of 34th Annual General Meeting of the Company to be held in the financial year 2022 and M/s. Lahoti Navneet & Co, Chartered Accountants, Mumbai (ICAI Firm Registration No. 116870W) were appointed as Joint Statutory auditors at the 30th Annual General Meeting held on September 29, 2018 for a period of 4 years i.e. to hold office from the conclusion of 30th Annual General Meeting until the conclusion of 34th Annual General Meeting of the Company to be held in the financial year 2022 Further, both the aforesaid Statutory Auditors have confirmed that they are not disqualified to act as Auditors and are eligible to hold office as Auditors of your Company for financial year 202021. -

Observations Of Statutory Auditors On Accounts For The Year Ended 31st March 2020:

There are no observations in the Auditors report for the financial year ended 31st March, 2020 therefore, do not call for any further explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.

Fraud Reporting:

During the year under review, there were no instances of material or serious fraud falling under Rule 13(1) of the Companies (Audit and Auditors) Rules, 2014, by officers or employees reported by the Statutory Auditors of the Company during the course of the audit.


Pursuant to provisions of Section 138 of the Companies Act, 2013 the Board on recommendation of the Audit Committee has appointed Mr. Amol Shah, as Internal Auditor of the Company


The Board had appointed M/s. Dilip Bharadiya & Associates, Practicing Company Secretaries, to conduct Secretarial Audit for the FY 201920. - The Secretarial Audit Report for the financial year ended March 31, 2020 is annexed herewith marked as Annexure-IV to this Report.

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

Further, pursuant to provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014; the Board of the Company at its meeting held on 09th July, 2020 has re-appointed M/s. Dilip Bharadiya & Associates, Practicing Company Secretaries (Certificate of Practice No. 7956), to undertake the Secretarial Audit of the Company for the financial year 2020-21.


The information required under Section 197(12) of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the Financial Year 2019-20; and

Percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer, Company Secretary, if any, for the Financial Year 201920: - NIL

Sr. No. Name Designation Remuneration for the Financial Year 2019-20 Percentage Increase/ (Decrease) in remuneration in the Financial Year 2019-20(%) Ratio of Remuneration of each Director to Median Remuneration of Employees
1. Dilip Kaushik Chief Financial Officer 7,52,400 Nil
2. Arpita Doshi (Resigned w.e.f. May 31, 2019) Company Secretary 70,000 Nil
3. Rupali Somani (Appointed w.e.f. October 07, 2019) Company Secretary 2,45,000 Nil

Percentage increase in the median remuneration of employees in the financial year:

There is no increase in the remuneration of employees in the financial year and hence the information cannot be furnished.

Number of permanent employees on the rolls of Company: 4

Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

Save and except, the payment of remuneration to Company Secretary and Chief Financial Officer with no percentage increase in remuneration in the financial year, no remuneration is being paid to any Director of the Company. Hence, the information pertaining to percentage increase in remuneration cannot be provided.

Affirmation that the remuneration is as per the remuneration policy of the Company:

It is hereby affirmed that the remuneration paid to:

-Directors, KMP and members of Senior Management is as per Remuneration Philosophy/Policy of the Company; and -other employees of the Company is as per the Human Resource Philosophy of the Company.

The information required under Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Having regard to the provisions of Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection and any member interested in obtaining a copy of the same may write to the Company Secretary on



The Company makes all efforts towards conservation of energy, protection of environment and ensuring safety.

The particulars as required under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo is as follows

Health , Safety and Environment:

The Company aims to provide a safe and healthy workplace to our employees, visitors and contract workers and achieve high standards of environment protection. We are certified to the following:

Certificate No./ Standard Description/Compliance/Requirement
ISO 9001:2015 The Quality Management System of the Inducto Steels
Quality Management System Limited has been audited and has been found to be in
accordance with the requirements of ISO 9001:2015
ISO 14001:2015 The Environmental Management System of the Inducto
Environmental Management Steels Limited has been audited and has been found to
System be in accordance with the requirements of ISO
OHSAS 18001:2007 The Occupational Health and Safety Management
Occupational Health and Safety System of the Inducto Steels Limited has been audited
Management System and has been found to be in accordance with the
requirements of OHSAS 18001:2007

Conservation of energy:

the steps taken or impact on conservation of energy;

the steps taken by the Company for utilising alternate sources of energy;

In light of the global challenges concerning energy security, the Company considers energy management as one of the key components of its responsible business strategy. The Company recognized the importance of energy conservation in decreasing the deleterious effects of global warming and climate change. The Company has implemented various initiatives for the conservation of energy and all efforts are made to minimize energy costs. Company is engaged in Ship Breaking, trading in metal scrap, coals, graphite electrodes and other industrial inouts. No significant power consumption is required in ship breaking industry as major portion in production process consist of non mechanical processes. However, industrial gases are used in ship dismantling activities and the Company has taken various measures to control the consumption of fuel and energy.

the capital investment on energy conservation equipments;

The Company is taking adequate steps to conserve energy though no such capital investment has been made.

Technology absorption:

The Company continues to adopt and use the latest technologies to improve the productivity and quality of its services and products. The Companys operations do not require significant absorption of technology. There has been no import of technology in FY 201920. -

Foreign exchange earnings and Outgo:

Particulars Current Year Previous Year
Foreign Exchange - - - - - -
Foreign Exchange - - - - - -


The Whistleblower Policy has been approved and adopted by Board of Directors of the Company in compliance with the provisions of Section 177 (10) of the Companies Act, 2013 and Regulation 22 of the Listing Regulations which provides a formal mechanism to the employees, business associates and stakeholders of the Company to, inter-alia, report any instances of financial irregularities, breach of code of conduct, abuse of authority, disclosure of financial/ price sensitive information, unethical / unfair actions concerning Company vendors/ suppliers, malafide manipulation of company data/records, actual or suspected fraud or discrimination to the Companys Code of Conduct in an anonymous manner.

The policy of vigil mechanism is available on the Companys website i.e.


The Company conducts Familiarization Programme for the Independent Directors to enable them to be familiarized with the Company, its management and its operations to gain a clear understanding of their roles, rights and responsibilities for enabling their contribution to the Company. They are provided a platform to interact with multiple levels of management and are provided with all the documents required and/or sought by them to have a good understanding of Companys operations, businesses and the industry as a whole.

Further, when a new Director is inducted on the Board, they are provided with necessary documents/ brochures, reports, internal policies, strategy and such other operational information to enable them to familiarize with the Companys procedures and practices. Site visits to various plant locations are organized for the Independent Directors to enable them to understand and acquaint with the operations of the Company.

Periodic presentations are made at the Board and Committee meetings on business and performance updates of the Company, global business environment, business strategy and risks involved. Detailed presentations on the Companys business segments are made at the separate meetings of the Independent Directors from time to time.

The details of such familiarization programmes for Independent Directors are put up on the Companys website and can be accessed at


Your Company is committed towards providing a work environment that is professional and mature, free from animosity and one that reinforces our value of ‘integrity that includes respect for the individual. The Company is committed to providing a safe and conducive work environment to all of its employees and associates.

In line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company has adopted a Policy on Prevention of Sexual Harassment at Workplace. This policy is applicable to all employees, irrespective of their level and it also includes ‘Third Party Harassment cases i.e. where sexual harassment is committed by any person who is not an employee of the Company. The said policy is available on the website of the Company i.e. Internal Complaints Committees have also been set up to redress complaints received regarding sexual harassment.

The Company has not received any complaint of sexual harassment during the financial year 2019-20.


[Statements in the Boards Report and the Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be "forward looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to your Companys operations include global and Indian demand supply conditions, finished goods prices, feed stock availability and prices, cyclical demand and pricing in your Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which your Company conducts business and other factors such as litigation and your Company is not obliged to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent development, information or events or otherwise. The "Managements Discussion and Analysis" does not constitute a prospectus, offering circular or offering memorandum or an offer to acquire any shares and should not be considered as a recommendation that any investor should subscribe for or purchase any of the Companys securities.


In terms of the applicable provisions of the Act and SEBI Listing Regulations, your Company additionally discloses that, during the year under review:

It there was no change in the nature of business of your Company; your Company has not accepted any fixed deposits from the public falling under Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014. Thus, as on March 31, 2020, there were no deposits which were unpaid or unclaimed and due for repayment, hence, there has been no default in repayment of deposits or payment of interest thereon; your Company has not issued any shares with differential voting rights; your Company has not any Sweat Equity Shares; and no significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status operations of your Company in future. isfurther disclosed that: There is no plan to revise the Financial Statements or Directors Report in respect of any previous financial year. No Material changes and commitments have occurred between the end of the Financial Year of the Company to which the Financial Statements relate and the date of the report affecting the financial position of the Company. Your Company does not engage in Commodity hedging activities.


The Board of Directors would like to express their sincere gratitude for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review.

The Board of Directors also wish to place on record its deep sense of appreciation for the committed services by the Companys executives, staff and workers at all levels. Our consistent growth was made possible by their hard work, solidarity, co-operation and support.

For and on behalf of the Board of Directors
Sd/- Sd/-
(DIN: 00034264) (DIN: 00041853)
Date: 09th July, 2020
Place: Mumbai