Tata Steel Long Products Ltd Directors Report.

To the Members,

Your Directors take pleasure in presenting the 3rd Integrated Report (prepared as per the framework set forth by the International Integrated Reporting Council) and the 38th Annual Accounts on the business and operations of Tata Steel Long Products Limited, (formerly Tata Sponge Iron Limited), (‘TSLP / ‘the Company) along with the summary of standalone and consolidated financial statements for the year ended March 31, 2021.

A. Financial Results

Particulars Standalone Consolidated
2020-21 2019-20 2020-21 2019-20
Revenue from operations 4,749.87 3,489.99 4,749.87 3,489.99
Total expenditure before finance cost, depreciation 3,651.45 3,336.72 3,651.46 3,336.73
Operating Profit 1,098.42 153.27 1,098.41 153.26
Add: Other income 78.23 81.26 78.28 81.32
Profit before finance cost, depreciation, exceptional items and taxes 1,176.65 234.53 1,176.69 234.58
Less: Finance costs 234.63 292.84 234.63 292.84
Profit before depreciation, exceptional items and taxes 942.02 (58.31) 942.06 (58.26)
Less: Depreciation and amortisation expenses 327.19 310.79 327.19 310.79
Profit/(Loss) before exceptional items & tax 614.83 (369.10) 614.87 (369.05)
Add/(Less): Exceptional Items - (161.14) - (161.14)
Profit before taxes 614.83 (530.24) 614.87 (530.19)
Less: Tax Expense 42.86 (13.96) 42.86 (13.96)
(A) Net Profit/(Loss) for the Period 571.97 (516.28) 572.01 (516.23)
Total Profit/(Loss) for the period attributable to:
Owners of the Company 571.97 (516.28) 572.01 (516.23)
Non-controlling interests - - - -
(B) Total other comprehensive income 5.31 (7.07) 5.31 (7.07)
(C) Total comprehensive income for the period [ A + B ] 577.28 (523.35) 577.32 (523.30)
Retained Earnings: Balance brought forward from the previous year (379.95) 159.54 (379.75) 159.69
Add: Profit for the period 571.97 (516.28) 572.01 (516.23)
Add: Other movements within equity - - - -
Balance 192.02 (356.74) 192.26 (356.54)
Which the Directors have apportioned as under to:-
(i) Dividend on Ordinary Shares 19.25 19.25
(ii) Tax on dividends 3.96 3.96
Total Appropriations - 23.21 - 23.21
Retained Earnings: Balance to be carried forward 192.02 (379.95) 192.26 (379.75)

1. Dividend Distribution Policy

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, (‘SEBI Listing Regulations) the Board of Directors of the Company (the ‘Board) has formulated and adopted the Dividend Distribution Policy (‘the Policy).

The Policy is annexed to this report (Annexure 1) and is available on our website at https://www.tatasteellp.com/ performance- corporate-governance/.

2. Dividend

For Financial Year 2020-21, the Board has recommended a dividend of 5/- per equity share on 4,51,00,000 equity shares of 10/- each, subject to approval of the shareholders at the ensuing Annual General Meeting scheduled to be held on Thursday, August 5, 2021. The Board has recommended dividend based on the parameters laid down in the Dividend Distribution Policy and dividend will be paid out of the profits for the year.

The dividend once approved by shareholders will be paid on and from August 9, 2021. If approved, the dividend would result in a cash outflow of 22.55 crore. The total dividend pay-out works out to 3.94% (Previous year – Nil) of the net profit (on standalone basis). Pursuant to the Finance Act, 2020, dividend income is taxable in the hands of the shareholders effective April 1, 2020 and the Company is required to deduct tax at source from dividend paid to the Members at prescribed rates as per the Income Tax Act, 1961.

The Register of Members and Share Transfer Books of the Company will remain closed from Saturday, July 24, 2021 to Thursday, August 5, 2021 (both days inclusive) for the purpose of payment of dividend and Annual General Meeting (‘AGM) scheduled to be held on Thursday, August 5, 2021.

3. Transfer to Reserves

The Board of Directors do not propose to transfer any amount to the general reserve.

4. Capex and Liquidity

During the year under review, the Company has spent 42.47 crore on capital projects largely towards essential sustenance and replacement.

The Companys liquidity position is 1,227.29 crore as on March 31, 2021, comprising of 281.78 crore in cash and cash equivalent and 945.51 crore in undrawn bank lines.

5. Management Discussion & Analysis Report

The Management Discussion and Analysis Report as required in terms of the SEBI Listing Regulations, is annexed to this Report (Annexure 2).

6. Credit Rating

The Company enjoys a sound reputation for its prudent financial management and its ability to meet financial obligations. The details of Credit Rating forms part of the Corporate Governance Report.

B. Integrated Report

In continuation with our commitment to stakeholders, in Financial Year 2017-18, we transitioned from compliance-based reporting to governance-based reporting by adopting the <IR> framework developed by the International Integrated Reporting Council.

Our 3rd Integrated Report highlights the measures taken by the Company that contributes to long-term sustainability and value creation, while embracing different skills, continuous innovation, sustainable growth and a better quality of life.

C. Operations & Performance

The COVID 19 breakdown has led to unprecedented socio- economic disruption worldwide. The nation-wide stringent lockdown brought the economic activities to a standstill. While Steel and mining activities were kept exempt subject to certain guidelines, the steel demand got impacted adversely as key consuming segments struggled to operate amidst weakening economic activities, major hubs in red/containment zones, working capital constraints, migrant labour issues and logistic challenges. The risk-intelligent culture embedded across the Company helped in developing and adopting a multi-pronged strategy to effectively respond to the evolving pandemic situation. The health and safety of our employees and the communities in which we operate continue to be the foremost priority of the Company while managing any impact for its customers and suppliers. As an immediate response to this pandemic, the Company has rolled out several employee friendly policies, morale building platforms and put in place the stringent mechanism on sanitisation and social distancing norm. The Company forthwith decided to scale down the operations and had been able to quickly ramp-up the operations by making a tactical decision to rapidly ramp-up the exports. As economic activities have started recovering with the removal of the lockdown and gradual relaxation in mobility restrictions, the Company leveraged various opportunities to increase penetration in the domestic market.

Despite several macroeconomic headwinds, volatile market environment and operational challenges, the Company delivered a robust performance driven by a strong focus on operational excellence and product/ market diversification. This being the 2nd year of operations for steel business after the acquisition, the Company focused more on stabilising the production at an increased rate. During the nationwide lockdown period in Q1 FY21, the Company has quickly ramped up exports volume to continue its operations. After signs of recovery post pandemic related lockdown measures in Q2 FY21, the Company has continued its strategy to increase production and diverse its product portfolio towards more value-added products. With improvement in economic activities over the quarters, the Company ramped up its steel production thereby registering higher crude steel production of 11% (Y-O-Y). The Company has also taken several initiatives to improve its presence in the chosen segments of the domestic market by enhancing reach and increasing share of business with the customers. This has resulted in the sales growth of 41% (Y-O-Y) in the domestic special steel business amidst the industry de-growth of about 13%. With the focus on product mix enrichment and diversification, the Company has increased alloy Wire Rod mix to 49% in FY 2020-21 as against 37% in FY 2019-20 while increasing the market share to 20% in FY 2020-21 against 12% in FY 2019-20, supported by increased share in Two-Wheel Steering ("2Ws") segment. The Company has also used this period as an opportunity to develop a total of 50 new products during the year as against 34 new products in FY 2019-20. The Company focused on liquidity and cash flow management in a big way. Special focus was brought to release the fund from working capital and lazy assets. A total amount of 589 crore unlocked through the effective management of working capital. Deleveraging has been adopted as a strategy to strengthen balance sheet for future growth and ~50% of the long-term loan has been discharged during the year much ahead of due dates.

In DRI business also the Company has shown the same agility and quickly ramped up the production levels to the normal levels as the market had started opening up in May20 onwards. All collaborative efforts have resulted in increasing the overall production to 797 KT with an increase of 4% w.r.t FY 2019-20.

D. Key Developments

Update on Radhikapur Coal Block

In November 2012, Ministry of Coal ("MoC") issued notices to the Company for invocation of bank guarantee of 32.50 crore submitted towards performance of conditions for allocation of Radhikapur (East) Coal Block, against which the Company had filed a writ petition in the Honble High Court of Delhi, which directed the Company to keep the bank guarantee valid till November 30, 2015 by which date the MoC was directed to take decision. The bank guarantee expired after November 30, 2015 and had not been renewed, as no communication was received from MoC. Subsequently, MoC issued a notice dated December 28, 2015, stating that the bank guarantee be invoked and the aforesaid amount be deposited. Consequent to MoCs notice, the Company moved to the Honble High Court of Delhi contesting, amongst other matters, that the delay was not attributable to the Company and that since the allocation has been declared illegal by the Honble Supreme Court, the bank guarantee cannot be encashed by the MoC. The Honble High Court of Delhi vide its Order dated May 27, 2020 remanded the matter to MoC to consider afresh on the aspect whether the delay in achieving the milestones was attributable to the Company. Further, the Company was required to furnish a bank guarantee and the Honble High Court also directed the MoC to render a final decision within six months from September 2, 2020. Pursuant to Honble High Court of Delhi directives, the Company has submitted the bank guarantee of 32.50 crore. The Inter-Ministerial Group of the MoC (IMG) issued a notice to the Company seeking details including the reasons for delay in achievement of the performance of conditions and the agencies responsible, to which the Company has responded. Further, in accordance with the directives from the Honble High Court of Delhi, the Company has extended the validity of the bank guarantee up to April 15, 2021 and MoC has been directed to take a decision by then, which is pending. Pending finalisation of the matter and based on legal opinion obtained by the Company, the amount continues to be treated as a contingent liability.

Material Changes Post Closure of Financial Year

Pursuant to the judgment of Honble Supreme Court of India, the Government of India had promulgated the Coal Mines (Special Provision) Rules, 2014 and subsequent amendments ("Rules"), for allocation of the coal mines through auction and matters related thereto. In terms of the said Rules, the prior allottee (i.e. the Company) shall be compensated for the expenses incurred towards land and mine infrastructure. As part of 11th tranche of auction under The Coal Mines Act 2015, the Ministry of Coal (MoC) has carried out an auction of the coal block in November 2020 and EMIL Mines and Mineral Resources Limited (EMMRL) was declared as the successful bidder by the Nominated Authority on December 24, 2020. The MoC issued the vesting order dated March 3, 2021 in favour of EMMRL and directed the Company to hand over all the rights/ licenses/ approvals and documents to EMMRL. The

Company has handed over the documents in respect of title deeds of land and possession of buildings and other required details on April 6, 2021 to EMMRL in compliance with the vesting order. The Company is awaiting directions from MoC on the determination of the just, fair & adequate compensation in respect of the aforesaid amounts incurred by the Company. Based on assessment of the matter by the Company including evidence supporting the expenditure and claim and an external legal opinion obtained by the Company in respect of the recoverability of the amount, no provision is considered necessary.

Merger & Amalgamation:

The Board at its meeting held on November 13, 2020, had approved the following schemes of amalgamation:

1. Scheme of Amalgamation of Tata Metaliks Limited ("TML") into and with Tata Steel Long Products Limited ("TSLP"); and

2. Scheme of Amalgamation of Indian Steel and Wire Products Limited ("ISWP") into and with TSLP.

Subsequent to the Boards approval, the Company had filed the respective schemes of amalgamation with the Stock Exchanges, viz. BSE Limited and National Stock Exchange of India Limited on November 14, 2020. The observation letter from the respective stock exchanges are awaited.

Payout of Bank Guarantee in connection with Brinda Sesai Coal Block:

The Steel business acquired by the Company in FY 2019 included a Coal Block under development, which carried a performance obligation by way of a bank guarantee to the Nominated Authority i.e. MoC, towards development of the said coal block. Post acquisition, the Company assessed the social and environmental challenges for the development of the coal block and was of the view that the performance obligations of developing the coal block looked challenging to fulfil. Accordingly, the Company, as a matter of prudence, had taken provision related to the aforesaid bank guarantee during the year ended March 31, 2020. Subsequently, the Company made an application to MoC seeking cancellation of the vesting of the coal block. Pursuant to such application, on November 11, 2020, the Company received a letter from MoC confirming cancellation of the vesting rights of the coal block and directed State Bank of India for the encashment of aforesaid bank guarantee associated with the performance obligation. Accordingly, the Company had made a payment of 133.72 crore on December 2, 2020. With the aforesaid provision already recorded during the year ended March 31, 2020, there is no further financial impact expected by the Company.

E. Corporate Sustainability

The current pandemic has reinforced the links between health, environment and economy. Various research has shown that climate change can contribute to pandemics, hence environmental resiliency becomes core for economic recovery and growth. Taking this to the Industry parlance, Sustainability is no longer a choice but a business imperative for sustenance and growth. Accordingly, as part of the Companys 2030 strategy, we have defined Sustainability Leadership as one of the strategic objectives. We need to adopt a two-pronged approach to realise our sustainability target. One with strategic intervention to adopt benchmark technology for our facilities to reduce carbon footprint and the second one for cultural changes amongst all our stakeholders to embrace circularity concept i.e. "closing the loop" by focusing on full life cycle resource productivity. Underpinning this approach, the Companys strategies are on low carbon transition, reducing dependence on freshwater consumption, maximising value from waste and exploring opportunities in the circular economy, enhancing biodiversity in the areas where the Company has its operations, building a sustainable and resilient supply chain and customer focussed product stewardship. The Company has also rolled out the Sustainability and Responsible supply chain policy during the year.

Safety and Environment

Conducting business responsibly is a cornerstone of the Companys strategy and culture. The most important aspect of conducting business is to ensure the total safety across all corner of operations. Inspite of taking all requisite steps towards safety, it is with deep regret that we report one fatality that took place at Vijay-II Iron Ore Mines. Keeping in mind the incident, the Company has adopted a holistic approach for its sustainability framework by giving focused impetus in areas of Safety, Health and Environment ("SHE"). Establishing high safety standards and enhancing safety performance at work are among the key priorities of the organisation. During the last year, emphasis was laid on capability building through structured trainings to evolve a mature safety culture. The Felt Leadership safety training for the employees continues to progress steadily to sensitise and build leadership competence on safety. Other strategies such as demonstration of visible leadership on the shop-floor by identification & elimination of Commonly Accepted Unsafe Practices (E-CAUP) by Senior Leaders; Identification & correction of Fatality Potential unsafe conditions (Safety Observations) by Middle level leaders; Identification & stoppage of fatality & serious injury potential unsafe acts (Site Severity Audits) by front line leaders were initiated to bring a holistic approach in field of safety management. Incident reporting and analysis was made more robust with introduction of standard investigation protocols and procedures. Roll out of online portal-‘Ensafe for reporting safety deviations; mandatory inclusion of SHE conditions in work orders of vendor partners; introduction of ‘process safety management were few other initiatives conceived and implemented during the year.

We have always believed that protecting the environment in which we operate & live are among our highest priorities. The Company has established an Environmental policy, Climate change policy and Energy policy and key tenants of the policies always guide in identifying and successfully managing the Environmental issues, energy usages, reduction in greenhouse gases ("GHG") and water conservation. Over the years we are continuously focusing on lowering the dust emission and other gaseous pollution from our industry by adopting the state of the art technologies. The Electro Static Precipitators (ESP) of captive power plant were recently upgraded to ensure emission much below the standards set by the government. Regular audits and monitoring are done to identify gaps and required engineering solutions are provided to bridge the gaps. The steel industry contributes to about 7-9% of global emission and is considered to be a ‘hard to abate sector since carbon is used as a reductant in the steelmaking process. Tata Steel Long Products has adopted several technologies to lower down the CO2 emission and have conceptualised some other best practices for adoption in its steel manufacturing, such as utilisation of waste heat for power generation and use of less carbon intensive substances in steel making. The Company believes that new technologies, will be fundamental means for industries to reduce their carbon footprints exponentially to achieve the global targets of climate change and has aligned its goals accordingly.

Corporate Social Responsibility (CSR)

The objective of the Companys Corporate Social Responsibility (‘CSR) initiatives is to improve the quality of life of communities through long-term value creation for all stakeholders. The Company has in place a CSR policy which provides guidelines to conduct CSR activities of the Company. The CSR policy is available on the website of the Company at https://www.tatasteellp.com/performance-corporate- governance/. During the year, the Company has spent 88.18 lakh, which includes 32.40 lakh received from Govt. of Odisha for deployment of Swatch Bharat Mission project on account of construction of toilets. Accordingly, the net outgo on account of CSR activities during Financial Year 2020-2021 is 55.78 lakh.

Companys primary focus areas of interventions are Education, Health & Sanitation and Livelihood enhancement. Besides, the Company also promotes sports and local cultural programs, with an objective to establish a deeper connect with the local youths and respect for the primeval culture existing in companys focus areas; apart from extending support to the victims of natural disasters & pandemic, as appropriate. All these interventions are prioritised and implemented through a set of short term and long-term programs & projects The Annual Report on CSR activities, in terms of Section 135 of the Companies Act, 2013 (‘the Act) and the Rules framed thereunder, is annexed to this report

(Annexure 3).

F. Corporate Governance

The Company believes that facilitation of effective, entrepreneurial and prudent management helps in delivering long term success of the Company. The fundamental objective of corporate governance in the Company is to boost and maximise shareholders value and protect the interest of other stakeholders.

In terms of Regulation 34(3) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance, together with certificate from Practicing Company Secretary, certifying compliance with conditions of Corporate Governance, forms part of this Report (Annexure 4).

Meetings of the Board and Committees of the Board

Meeting calendar for Board and Committees is prepared and circulated in advance to the Directors at the beginning of every year. During the year, Seven (7) meetings of Board and Six (6) Audit Committee meetings were held, details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. All recommendations made by the Audit Committee were duly accepted by the Board during the Financial Year 2020-21. The details of composition of the Board and its Committees as well as details of Board and Committee meetings held during the year are given in the Corporate Governance Report, which forms part of this Report.

Selection of New Directors and Board Membership Criteria

The Nomination and Remuneration Committee (‘NRC) engages with the Board to determine the appropriate characteristics, skills and experience for the Board as a whole as well as for its individual members with the objective of having a Board with diverse backgrounds and experience in business, finance, governance, and public service. Thereafter, the NRC recommends to the Board the selection of new Directors.

Characteristics expected of all Directors include independence, integrity, high personal and professional ethics, sound business judgement, ability to participate constructively in deliberations, and willingness to exercise authority in a collective manner. The Company has in place a Policy on appointment & removal of Directors ("Policy"). The salient features of the Policy are:

• It acts as a guideline for matters relating to appointment and re-appointment of directors;

• It contains guidelines for determining qualifications, positive attributes of directors, and independence of a Director;

• It lays down the criteria for Board Membership;

• It sets out the approach of the Company on board diversity;

• It lays down the criteria for determining independence of a director, in case of appointment of an Independent Director.

During the year under review, there has been no change to the Policy.

The Policy is available on the website of the Company at https:// www.tatasteellp.com/performance-corporate-governance/

Familiarisation Programme for Directors

All new Directors (including Independent Directors) inducted to the Board go through a structured orientation program. Presentations are made by Senior Management giving an overview of the operations, to familiarise the new Directors with the Companys business operations. The Familiarisation Program of Ms. Karmakar, Independent Director has been carried out during Financial Year 2020-21. During the year under review, one Non-Executive Director was inducted on the Board effective October 13, 2020. Details of orientation given to the existing independent directors in the areas of Corporate Social Responsibility, Operations, Marketing, Sales & Supply Chain Management, Governance Risk & Compliance, Human Resource Management etc., are available on the website at https://www.tatasteellp.com/wp-content/uploads/2021/04/Familiarization-Independent Directors-2020-21.pdf.

Evaluation

The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Board sought the feedback of Directors on various parameters including:

• Degree of fulfillment of key responsibilities towards stakeholders (by way of monitoring corporate governance practices, participation in the long-term strategic planning, etc.);

• Structure, composition and role clarity of the Board and Committees;

• Extent of co-ordination and cohesiveness between the Board and its Committees;

• Effectiveness of the deliberations and process management;

• Board/Committee culture and dynamics; and

• Quality of relationship between Board Members and the Management.

The above criteria are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 05, 2017.

The Chairman of the Board had one-on-one meetings with each Independent Director and the Chairman of NRC had one-on-one meetings with each Executive and Non-Executive, Non-Independent Directors. These meetings were intended to obtain Directors inputs on effectiveness of the Board/ Committee processes.

In a separate meeting of independent directors, performance of non-independent directors, the board as a whole and the Chairman of the Company was evaluated, taking into account the views of executive directors and non-executive directors.

The Nomination and Remuneration Committee reviewed the performance of the individual directors and the Board as a whole.

In the Board meeting that followed the meeting of the independent directors and the meeting of Nomination and Remuneration Committee, the performance of the Board, its committees, and individual directors was discussed.

Remuneration Policy for the Board and Senior Management

Based on the recommendations of NRC, the Board has approved the Remuneration Policy for Directors, Key Managerial Personnel (‘KMPs), and all other employees of the Company. As part of the policy, the Company strives to ensure that:

• the level and composition of remuneration is reasonable and sufficient to attract, retain, and motivate Directors of the quality required to run the Company successfully;

• relationship between remuneration and performance is clear and meets appropriate performance benchmarks; and

• remuneration to Directors, KMPs, and Senior Management involves a balance between fixed and incentive pay, reflecting short, medium, and long-term performance objectives appropriate to the working of the Company and its goals.

The salient features of the Policy are:

• It lays down the parameters based on which payment of remuneration (including sitting fees and remuneration) should be made to Independent Directors and Non-Executive Directors.

• It lays down the parameters based on which remuneration (including fixed salary, benefits and perquisites, bonus/ performance linked incentive, commission, retirement benefits) should be given to whole-time directors, KMPs, and rest of the employees.

• It lays down the parameters for remuneration payable to Director for services rendered in other capacity.

• During the year under review, there has been no change to the Policy. The Policy is available on the website of the Company at https://www.tatasteellp. com/performance- corporate-governance/.

Particulars of Employees

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to this report (Annexure 5).

In terms of the provisions of 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, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits as set out in the said Rules forms part of this report.

Director(s)

During the year under review, the following changes took place in the composition of the Board of Directors of the Company:

Cessations

During the year under review, Mr. P.C. Parakh (DIN: 01305775) ceased to be an Independent Director of the Company, on completion of his tenure as Member of the Board effective August 20, 2020. The Board placed on record its appreciation for his invaluable contribution and guidance during his tenure of association as Director in the Company.

Inductions

The Board of Directors of the Company, based on the recommendation of Nomination and Remuneration Committee ("NRC"), approved the appointment of Dr. Debashish Bhattacharjee (DIN: 00060737) as an Additional Director on the Board of the Company. The resolution for confirming this appointment forms part of the Notice of ensuing AGM scheduled to be held on Thursday, August 5, 2021. The profile and particulars of experience, attributes and skills that qualify Dr. Bhattacharjee for the Board membership are also disclosed in the said Notice.

Re-Appointment

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Companys Articles of Association, Mrs. Meena Lall (DIN: 05133322) (Non-Executive Non- Independent Director), retires by rotation at the ensuing AGM of the Company and being eligible, seeks re-appointment. The necessary resolution for re-appointment of Mrs. Lall forms part of the Notice of ensuing AGM. The profile and particulars of experience, attributes and skills that qualify Mrs. Lall for the Board membership are also disclosed in the said Notice. During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees and commission for attending the meetings. As per the internal guidelines of the Company, no payment is made towards commission to the Non-Executive Directors of the Company, who are in full-time employment with any other Tata Company.

Independent Directors Declaration

The Independent Directors of the Company have been appointed in terms of the requirements of the Companies Act, 2013 ("the Act"), the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations").

The Company has received declaration from the Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act read with Regulation 16(1) (b) of the Listing Regulations. In terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstances or situations which exist or may be reasonably anticipated that could impair or impact their ability to discharge their duties.

In the opinion of the Board, there has been no change in the circumstances which may affect their status as independent directors of the Company and the Board is satisfied of the integrity, expertise, and experience

(including pro_ciency in terms of Section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board. In terms of Section 150 of the Act, read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, Independent Directors of the Company have undertaken requisite steps towards the inclusion of their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.

Key Managerial Personnel:

Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company are as follows as on the date of this report:-

1. Mr. Ashish Anupam – Managing Director;

2. Mr. S. K. Mishra – Chief Financial Officer;

3. Mr. Sanjay Kumar Shrivastav – Joint Chief Financial Officer;

4. Mr. Sankar Bhattacharya – Company Secretary and Compliance Officer (Inducted effective April 9, 2021) Prior to Joining of Mr. Sankar Bhattacharya as Company Secretary and Compliance Officer, Mr. Sanjay Kasture served as the Company Secretary of the Company. Mr. Kasture resigned from the services of the Company effective April 8, 2021. The Board placed on record its appreciation for his services rendered during his tenure as Company Secretary of the Company.

Apart from the above, no other changes took place in the key managerial personnel of the Company.

Independent Directors Meeting:

During the year under review, the Independent Directors met on December 18, 2020 and March 16, 2021, inter alia, to: a) Review the performance of Non-Independent Directors and the Board of Directors as a whole; b) Review the performance of the Chairman of the Company, taking into account the views of the Executive and Non- Executive Directors; c) Assess the quality, content and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform its duties. All Independent Directors were present at these meetings.

Board Diversity

The Company recognises and embraces the importance of a diverse Board in its success. The Company believes that a truly diverse Board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help the Company to retain its competitive advantage.

Audit Committee

The Audit Committee is duly constituted as per the provisions of the Companies Act, 2013, applicable Rules framed thereunder read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Committee has adopted a Charter for its functioning. The primary objective of the Committee is monitoring and supervising the Managements financial reporting process to ensure accurate and timely disclosures with highest levels of transparency, integrity and quality of financial reporting. During the Financial Year, there has been no instance where the Board has not accepted any recommendation of the Committee.

The Committee comprises of Mr. Srikumar Menon (Chairman), Mr. Shashi Kant Maudgal, Ms. Neeta Karmakar and Mr. Koushik Chatterjee. The Committee met 6 (six) times during the year under review. Details of terms of reference of the Committee, details on meeting held and attendance of Members during the year forms part of the Corporate Governance Report.

Internal Process & Financial Control

Improvement in the business processes and systems across all functions is a continuous process, in line with the Tata Business Excellence Model that the Company has adopted. The Company continues to maintain Integrated Management System (IMS) comprising of Quality Management System (ISO: 9001), Environment Management System (ISO: 14001) and Occupational Health, Safety & Accountability Management System (ISO: 18001).

The Company has an internal control system commensurate with the size, scale and complexity of its operations. The scope of authority of the Internal Audit function is defined in the Internal Audit Charter. The Companys internal controls are tested for adequacy and effectiveness by the Internal Auditor and Statutory Auditors on a regular basis.

Risk Management

The Company has a Board-level Risk Management committee of Independent Directors and executive members of Tata Steel with diverse set of expertise. The Committee consists of the board members to oversee the risk management policy, to provide guidelines for implementing the ERM framework and also reviews the key risks and mitigation plan of the Company. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The development and implementation of risk management policy has been covered in the Management Discussion and Analysis Report, which forms part of this report.

Vigil Mechanism/ Whistle Blower Mechanism

The Company has a well-defined Vigil Mechanism policy in place that provides a formal mechanism for all Directors, employees, business associates and vendors of the Company to approach the Ethics Counsellor / Chairman of the Audit Committee. The mechanism can be availed to make protective disclosures about any unethical behaviour, actual or suspected fraud or violation of the Tata Code of Conduct (TCoC). During the year under review, no person has been denied access to the Chairman of the Audit Committee. In addition, Directors, employees, and vendors, may approach the Ethics Counsellor to make any such protected disclosure.

During FY 2020-21, the Company received 19 whistle blower complaints and all of the complaints were investigated and resolved at the end of the year. The Vigil Mechanism includes policies viz. Whistle Blower Policy, Gifts Policy, Anti Bribery, Anti-Corruption Policy, Anti Money laundering Policy, as adopted by the Company, which are available on the website of the Company at https://www.tatasteellp.com/performance-corporategovernance/

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

The Company has zero tolerance for sexual harassment at workplace and adopted a gender-neutral Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder.

Further, the Company has an Internal Complaint Committees for various locations of the Company in compliance with the above-mentioned Act and Rules. During the Financial Year 2020-21 the Company had one complaint of sexual harassment, which has been successfully discharged by taking appropriate action within the defined timeline.

Related Party Transactions:

In line with the requirements of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated a Policy on Related Party Transactions (‘RPTs) and the same can be accessed on the Companys website at https://www.tatasteellp.com/performance-corporate-governance/ All transactions with related parties (including material transactions) during FY 2020-21 were reviewed and approved by the Audit Committee and were at arms length and in the ordinary course of business. Prior omnibus approval was obtained for RPTs which were of repetitive nature and entered in the ordinary course of business and on an arms length basis. The transactions entered into pursuant to the omnibus approval so granted were reviewed by the Audit Committee on quarterly basis. There were 5 (five) material RPTs in FY 2020-21 under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details of transactions with related party as per Form AOC-2 are provided in this report (Annexure – 6) to this Report.

Details of RPTs entered into by the Company, in terms of Ind AS-24 are disclosed in notes to the standalone / consolidated financial statements forming part of this Integrated Report. There were no other material RPTs entered into by the Company with its Promoters, Directors, KMPs or other designated persons during FY 2020-21, except those reported in the financial statements. None of your Directors or KMPs had any pecuniary relationships or transactions with the Company during FY 2020-21. Approval of Members is being sought for 5 (five) material RPTs for FY 2021-22 and FY 2022-23 at the scheduled to be held on Thursday, August 5, 2021.

Directors Responsibility Statement

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the Internal, Statutory, Cost and Secretarial Auditors and external consultant(s) including audit of internal financial controls over financial reporting by the statutory auditors, reviews performed by the 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(5) of the Companies Act, 2013, the Board of Directors, to the best of its knowledge and ability confirms that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed and that there were no material departures;

b) they have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit of the Company for that period;

c) they have taken proper and sufficient care 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;

d) they have prepared the annual accounts on a going concern basis;

e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively;

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

Governance Guidelines

The Companys governance guidelines on Board effectiveness cover aspects relating to composition and role of the Board, Chairman and Directors, Board diversity, term of Directors, retirement age and Committees of the Board. The guidelines also cover key aspects relating to nomination, appointment, induction and development of Directors, Directors remuneration, oversight on subsidiary performances, code of conduct, Board effectiveness reviews and various mandates of Board Committees.

Business Responsibility Report

Pursuant to Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility Report (BRR) on initiatives taken from an environmental, social and governance perspective, is annexed to this report (Annexure – 7). The said report is also available on the Companys website, https://www.tatasteellp.com/ performance-corporate-governance/

Subsidiary Company

The Company has a wholly owned subsidiary i.e. "TSIL Energy Limited". There is no associate or joint venture company as defined under the Companies Act, 2013. Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 and the amendments thereto, and the SEBI Listing Regulations, a statement containing salient features of the financial statements of TSIL Energy Limited in Form AOC-1 is annexed to this report

(Annexure – 8).

Further, pursuant to the provisions of Section 136 of the Companies Act, 2013, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited accounts of TSIL Energy Limited are available on the website of the

Company at https://www.tatasteellp.com/subsidiary-information/

Auditors

(a) Statutory Auditors

Pursuant to the provisions of Section 139 of the Companies Act, 2013, read with Companies (Audit and Auditors) Rules, 2014, as amended from time to time, Messrs. Price Waterhouse & Co. Chartered Accountants LLP (Firm Registration Number: 304026E

/ E300009) (‘PWC), were appointed as statutory auditors from the conclusion of the Thirty fourth Annual General Meeting ("AGM") held on August 04, 2017 for a period of 5 years commencing from the conclusion of the Thirty fourth AGM held on August 04, 2017 until the conclusion of the Thirty-ninth AGM of the Company to be held in the year 2022.

In terms of the provisions relating to statutory auditors forming part of the Companies Amendment Act, 2017, notified on May 7, 2018, rati_cation of appointment of Statutory Auditors at every AGM is no more a legal requirement. Accordingly, the Notice convening the ensuing AGM does not carry any resolution on rati_cation of appointment of Statutory Auditors.

The report of the Statutory Auditor forms part of the Integrated Report and Annual Accounts for FY 2020-21. The said report does not contain any qualification, reservation, adverse remark or disclaimer. During the year under review, the Statutory Auditors did not report any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.

(b) Cost Auditors

In terms of Section 148 of the Act, the Company is required to maintain cost records and have the audit of its cost records conducted by a Cost Accountant. Cost records are prepared and maintained by the Company as required under Section 148(1) of the Act. The Board of Directors, on the recommendation of Audit Committee, has appointed Messrs. Shome

& Banerjee, Cost Accountants, (Firm Registration Number: 000001) as Cost Auditor to audit the cost statements of the Company for the Financial Year 2021-22.

Messrs. Shome & Banerjee have vast experience in the field of cost audit and have been conducting the audit of the cost records of the Company for the past several years.

In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the companies (Audit and

Auditors) Rules, 2014, as amended, the remuneration of 6 lakh plus applicable taxes and reimbursement of out-of-pocket expenses payable to the Cost Auditors as recommended by the Audit Committee and approved by the Board has to be rati_ed by the Members of the Company. Accordingly, a resolution to this effect forms part of the Notice convening the AGM.

(c) Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed Messrs. S. M. Gupta & Co., (Registration no. P1993WB046600) a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company for the Financial Year 2020-21.

The Secretarial Audit Report for the Financial Year 2020-21, is annexed to this report (Annexure – 9). The Board has also appointed Messrs. S. M. Gupta & Co., as Secretarial Auditor to conduct the Secretarial Audit of the Company for Financial Year 2021-22.

Annual Return

The Annual Return for Financial Year 2020-21 as per provisions of the Act and Rules thereto, is available on the Companys website at https://www.tatasteellp. com/extracts-of-annual-return/

Significant and Material Orders Passed by the Regulators or Courts

There has been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companys future operations. However, Members attention is drawn to the statement on contingent liabilities, commitments in the notes forming part of the Financial Statements.

Particulars of Conservation of Energy,

Technology Absorption and Foreign Exchange Earnings and Outgo

As required under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, the particulars regarding conservation of energy, technology absorption, foreign exchange earnings and outgo are annexed to this report (Annexure 10).

Particulars of Loans, Guarantees or Investments by the Company

Particulars of loans, guarantees given or investments made during the year under review in accordance with Section 186 of the Act is annexed to this report (Annexure 11).

Deposits

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

Listing Fees

. The Annual Listing Fee for the Financial Year 2020- 21 has been paid to the Stock Exchanges where the Companys shares are listed.

Industrial Relations

During the year under review, industrial relations remained harmonious and cordial.

Secretarial Standards

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

.

G. Acknowledgements

The Directors regret the loss of life due to COVID-19 pandemic and are deeply grateful and have immense respect for every person who risked their life and safety to _ght this pandemic.

We thank our customers, vendors, dealers, investors, business associates and bankers for their continued support during the year. We place on record our appreciation of the contribution made by employees at all levels. Our resilience to meet challenges was made possible by their hard work, solidarity, co-operation and support.

We thank the Government of India, the State Governments and other regulatory authorities and government agencies for their support and look forward to their continued support in the future.

On behalf of the Board of Directors

Sd/-
T.V. Narendran
Place: Jamshedpur Chairman
Date: April 20, 2021 (DIN: 03083605)