To

The Members,

Your Directors are pleased to present the 33rd Annual Report together with the
Statement of Accounts for the year ended on 31st March, 2012.


AUDITED FINANCIAL RESULTS

(Rs. in Crore)


  

    
Particulars
    
Standalone
    
Consolidated
  
  

    

    
Financial Year ended 31.03.2012
    
Financial Year ended 31.03.2011
    
Financial Year ended 31.03.2012
    
Financial Year ended 31.03.2011
  
  

    
Sales & other income
    
13,518.43
    
9,717.34
    
18,350.53
    
13,193.60
  
  

    
Profit before interest and depreciation
    
4,246.95
    
3,725.72
    
6,935.11
    
6,398.17
  
  

    
Profit before tax
    
2,843.01
    
2,753.36
    
5,188.60
    
4,988.02
  
  

    
Profit after tax
    
2,110.65
    
2,064.12
    
4,002.26
    
3,804.01
  
  

    
Appropriations:
    

    

    

    

  
  

    
Interim dividend
    
-
    
-
    
4.82
    
4.29
  
  

    
Final dividend
    
149.46
    
140.19
    
149.46
    
140.19
  
  

    
Corporate tax on dividend
    
3.15
    
3.75
    
25.03
    
23.44
  
  

    
General reserve
    
220.00
    
210.00
    
222.54
    
211.65
  



FURTHER ISSUE OF CAPITAL

During the period under report the Company has allotted 3,24,223 equity shares of Rs.
1/- each on 12th December, 2011 against options granted under the Company's Employee Stock
Option Scheme- 2005.


DIVIDEND

Your Directors recommend a dividend of Rs. 1.60 per equity share of Rs. 1/- each i.e.
160% for the financial year 2011-12. The total dividend pay-out for the year will amount
to Rs. 149.46 crore (excluding dividend tax).


OPERATIONAL REVIEW

The Company has, on a consolidated basis, achieved an aggregate income of Rs. 18,350.53
crore compared to previous year's Rs. 13,193.60 crore. Profit before tax has increased to
Rs. 5,188.60 crore in 2011-12 from Rs. 4,988.02 crore in 2010-11. Profit after tax has
also grown to Rs. 4,002.26 crore in the year under report from Rs. 3,804.01 crore in the
previous year. The Reserves and Surplus have touched Rs. 18,017.63 crore.


Sponge Iron

The Company produced 13,19,940 MT of Sponge Iron during the year under report as
against previous year's production of 13,19,840 MT and achieved a capacity utilisation of
96.35%.


Steel

The production of steel products during the year under report, compared to previous
year is given below:


  

    
Sl. No.
    
Product
    
Production in MT
  
  

    

    

    
(2011-12)
    
(2010-11)
  
  

    
1.
    
Finished steel products
    
19,44,434
    
15,85,327
  
  

    
2.
    
Semi steel products
    
27,56,881
    
22,72,692
  



Pellet

The Company produced 37,36,915 MT of pellets during the year under report as against
27,87,285 MT in the previous year.


Power

The Company generated 4,634 million Kwh of power during the year under report as
against last year's 3,420 million Kwh of power.


Raipur Unit

Raipur Unit produced 1,778 metric tons of castings and has done machining of 9,060
metric tons during the year under report as against 1,569 metric tons and 8,613 metric
tons respectively in the previous year.


Mining

The production of calibrated iron ore at captive mine at Tensa in Odisha was 5.06 lacs
MT as against previous year's production of 6.69 lacs MT. The Company has exported 2.45
lacs MT of iron ore fines as against 8.42 lacs MT in the previous year. Coal production at
captive mine was 59.98 lacs MT as against previous year's production of 59.99 lacs MT.


PROJECTS COMPLETED

Following projects were completed during the year under report:


1. Power Plants

(i) 540 MW (4X135 MW) power plant at Dongamahua, Raigarh Chhattisgarh: Under Phase-II,
Unit I and II of 135 MW each power generation capacity were commissioned in January, 2012.
Both the Units have stabilised their operations. With this, all the four Units of 135 MW
each power generation capacity set up at Dongamahua, Raigarh, Chhattisgarh are operational
and generating power.

(ii) 810 MW (6x135 MW) power plant at Angul, Odisha:

The Company is setting up 810 MW (6x135 MW) captive power plant at Angul, Odisha for
meeting power requirement of its upcoming 6 MTPA integrated steel plant. Second Unit of
135 MW power generation capacity was commissioned in February, 2012. With this, two units
of 135 MW each are operational and generating power. Third Unit of 135 MW power generation
capacity is expected to be commissioned in July, 2012.


2. Machinery Division, Raipur, Chhattisgarh

The production capacity of Machinery Division of Raipur Unit has been enhanced from
5,100 metric tons per annum to 10,000 metric tons per annum by making investment in
machine tools, expansion of covered area and material handling equipment. The Company has
received IBR Certification as manufacturer of headers of Boilers and foundry items. This
Division is envisaging further expansion of its capacity by inclusion of more covered area
and material handling facility and has planned to install Alfa Set Sand System in foundry
for further improvement in product quality. The Pressure Vessel Division with a capacity
of 2,500 metric tons per annum has started commercial operations.


PROJECTS UNDER IMPLEMENTATION

1. Steel Plant at Angul, Odisha

The Company is setting up 6 MTPA steel plant at Angul in the state of Odisha. The
following facilities are, at present, under installation:

1.1) Coal Washery (2x 600 TPH)

1.2) Sponge Iron Plant based on Coal Gasification (1.8 MTPA)

1.3) Steel Melting Shop (1.64 MTPA)

1.4) Plate Mill (1.5 MTPA)

1.5) Captive Power Plant (6x135 MW)

Out of the above facilities under implementation, the construction of Plate Mill has
been completed and is expected to be commissioned in financial year 2012-13. Apart from
this, work on raw material handling plant, beam welding plant, cross country pipeline, raw
water reservoir, in-take pump house and a housing colony is at an advanced stage of
implementation.

The following facilities are also being set up at Angul:

1.1) Coke Oven Plant (2.0 MTPA)

1.2) Sinter Plant (4.0 MTPA)

1.3) Pellet Plant (4.0 MTPA)

1.4) Blast Furnace (3.2 MTPA)

1.5) Sponge Iron Plant (2.0 MTPA)

1.6) Steel Melting Shop (4.36 MTPA)

1.7) Hot Strip Mill (4.5 MTPA)

Department of Water Resources, Government of Odisha has given permission for drawing of
95.16 cusecs of water from river Bramhani for the plant. Ministry of Environment &
Forests, Government of India has issued environmental clearance and Odisha State Pollution
Control Board has issued consent to establish for setting up of said steel plant.
Technology suppliers for Sinter Plant (4.0 MTPA), Blast Furnace (3.2 MTPA) and Sponge Iron
Plant (2.0 MTPA) have been finalised and discussions are under progress for finalising
technology suppliers for remaining facilities.


2) Steel Plant at Patratu, Jharkhand

The Company envisages setting up of 6 MTPA integrated steel plant at Patratu in the
state of Jharkhand and in its first phase, is implementing 3 MTPA steel plant.

Agreement has been signed with Government of Jharkhand for supply of 66.54 mcm of water
from Damodar Basin for the plant and an agreement with Jharkhand State Electricity Board
is under process of renewal for supply of 20 cusecs of water. Ministry of Environment
& Forests, Government of India has issued environmental clearance and State Pollution
Control Board, Jharkhand has issued consent to establish for setting up of said steel
plant. The Company has already acquired 1,039 acres of land and process is on for
acquiring balance 2,205 acres of land.


3) Steel plant, Raigarh, Chhattisgarh

The existing steelmaking capacity at Raigarh Works is 3 MTPA. Considering the
increasing demand for steel in coming years, the Company plans to enhance steelmaking
capacity at Raigarh Works to 11 MTPA and is in the process of seeking various approvals.
The Company has entered into memoranda of understanding with the State Government of
Chhattisgarh in terms of which the State Government of Chhattisgarh will extend necessary
assistance to the Company in expeditiously obtaining various approvals, coal and iron ore
linkages, environmental clearances, acquisition of land etc. for implementing the said
expansion plan. Ministry of Environment and Forests, Government of India has issued Terms
of Reference (TOR) for the proposed expansion in terms of which the Company has submitted
draft Environment Impact Assessment and Environment Management Plan to the Chhattisgarh
Environment Conservation Board, Raipur, Chhattisgarh.

In order to further improve and strengthen the present operations, the following
facilities are being added:-

3.1) Additional mill for pulverised coal injection is being set up which will help in
increasing the coal injection in Blast Furnace thereby reducing the consumption of coal as
well as improving the productivity.

3.2) Third Turbo-blower is being installed which will act as standby to the existing
two turbo blowers and ensure continuity of hot blast air to Blast Furnace in case of shut
down of any turbo.

3.3) Slab Caster upgradation is being done to increase the width of the slabs. This
will help in rolling the increased width plates from the Plate Mill.

3.4) Additional 6 Silos are being set up to blend different kinds of coal. Low cost
coal is blended with high grade coking coal to reduce the cost of blended coal and thus
reduces the cost of coke. This will reduce the cost of conversion of hot metal in Blast
Furnace.

3.5) Second Ladle Refining Furnace is being installed in Steel Melting Shop - III which
will increase steel-making capacity by increasing the capacity of secondary steel making.


4. Pellet Plant at Barbil, Odisha

The Company is setting up one more 4.5 MTPA Iron Ore Pellet Plant with wet grinding
process at Barbil for which basic engineering and proprietary equipment have been ordered.
Water approval, environmental clearance and consent to establish for setting up 10 MTPA
Pellet plant at Barbil have already been received. Detailed engineering agency has been
finalised and critical packages ordering is in progress. The pelletisation will be a value
added process of iron ore fines and better utilisation of powdery ore available in the
mines.


5. Shadeed Sponge Iron Plant

As a part of expansion, Shadeed Iron & Steel Co. LLC, Oman, a subsidiary company,
is setting up a 2 MTPA Steel Melting Shop. M/s Danieli, Italy has been finalised as the
technology and core equipment supplier and M/s Idom, Spain has been finalised as the
Engineering Consultant.


SUBSIDIARY COMPANIES AND THEIR BUSINESS

Jindal Power Limited (JPL), operating 1,000 MW (4 X 250 MW) power plant in Raigarh
(Chhattisgarh) has closed financial year 2011-12 with a total sales of Rs. 3,040.35 crore
and earned a profit after tax of Rs. 1,764.99 crore. JPL is expanding its power generation
capacity by setting up 2,400 MW (4 X 600 MW) power plant adjacent to its existing works.
JPL envisages setting up hydro projects in the State of Arunachal Pradesh in Joint Venture
with Hydro Power Development Corporation of Arunachal Pradesh Limited and thermal power
projects in the states of Jharkhand and Odisha. Shadeed Iron & Steel LLC, Oman,
operating 1.5 MTPA Hot Briquette Iron plant achieved sales of Rs. 2,794.30 crore in the
financial year 2011-12 and earned a profit after tax of Rs. 244.17 crore. Jindal Mining SA
(Pty) Limited, South Africa, operating coal mines achieved a sales of Rs. 451.02 crore in
the financial year 2011-12 and earned a profit after tax of Rs. 38.18 crore.

Africa continent and Australia are rich in mineral resources and your Company, through
its subsidiary companies, is expanding its business activities by acquiring, exploring and
operating iron, coal, limestone and base metals. The operations in Kiepersol Colliery in
South Africa stabilised over the last year enabling a ramp up of production in the coming
years. The Company also continues to pursue more opportunities in mining of coal, iron ore
and manganese in this country. In Mozambique, the coking coal project is in the final
stages of development. The sale is likely to start in financial year 2012-13.


TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to Section 205C of the Companies Act, 1956, the Company has transferred unpaid
/ unclaimed final dividend for financial year 2003-04 and interim dividend for financial
year 2004-05 amounting to Rs. 20,03,753/- (Rupees twenty lacs three thousand seven hundred
and fifty three only) and Rs. 16,77,124/- (Rupees sixteen lacs seventy seven thousand one
hundred twenty four only) respectively to Investor Education and

Protection Fund of Government of India. The details including last date for claiming of
unclaimed / unpaid dividend amount is given at the end of the Notice of the Annual General
Meeting.


EMPLOYEES STOCK OPTION

Details of allotment of shares made pursuant to Employees Stock Option Scheme-2005 to
the employees of the Company and its subsidiary, Jindal Power Limited during the period
under report is given below:


  

    
S.No. 
    
Series
    
No. of Equity Shares Allotted
    
Date of Allotment
  
  

    
1
    
Series III (Part III)
    
3,24,223
    
12th December 2011
  


As required by clause 12 of SEBI (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 information with respect to active Stock Options as on
31st March, 2012 is given in a separate statement as Annexure-I forming part of this
Report.


LISTING

The equity shares continue to be listed on BSE Limited (BSE) and the National Stock
Exchange of India Limited (NSE). Both these stock exchanges have nation-wide terminals and
therefore, shareholders / Investors are not facing any difficulty in trading in the shares
of the Company from any part of the country. The Company has paid annual listing fee for
the financial year 201213 to BSE & NSE and annual custody fee to National Securities
Depository Limited and Central Depository Services (India) Limited. Shares issued against
stock options have been listed and trading permission has been granted by these stock
exchanges.


FIXED DEPOSITS

The Company has not received any fresh deposits during the year under report. The
aggregate amount outstanding in respect of fixed deposits as on 31st March, 2012 was Rs.
37.22 crore against 6,938 fixed deposit holders. Amount of deposits that have matured but
were unclaimed as on 31st March, 2012 was Rs. 1.11 crore representing 384 deposit holders.
Since then 39 deposits totaling Rs. 16.28 lacs have been paid.


DIRECTORS

IDBI Bank Limited has withdrawn nomination of Shri S. Ananthakrishnan from the
Directorship from the close of business hours on 27th February, 2012 and nominated Shri
Inderpal Singh Kalra as Director w.e.f. 28th February, 2012. Smt. Savitri Jindal and Shri
Naushad Akhter Ansari have resigned from the Directorship of the Company w.e.f. 26th
April, 2012 and 01st May, 2012 respectively. Shri Haigreve Khaitan, Shri Hardip Singh
Wirk, Shri Rahul Mehra and Shri Sushil Maroo, Directors of the Company will retire by
rotation at the forthcoming Annual General Meeting and being eligible have offered
themselves for re-appointment as Directors of the Company, liable to retire by rotation,
in the said meeting.


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


Information pursuant to Section 217(1) (e) of the Companies Act, 1956 read with Rule 2
of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 regarding conservation of energy, technology absorption and foreign exchange earnings
and outgo is given in Annexure II forming part of this report.


PARTicULARS OF EMPLOYEES

In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the
Companies (Particulars of Employees) Rules, 1975 as amended from time to time, the
particulars of employees are set out in Annexure-III to this Report. However, as per
provisions of Section 219(1)(b)(iv) of the said Act read with Clause 32 of the Listing
Agreement, the Annual Report excluding the aforesaid information is being sent to all the
members of the Company and others entitled thereto. Any member interested in obtaining
such particulars may write to the Company.


CORPORATE GOVERNANCE

Your Company has implemented the conditions of Corporate Governance as contained in
Clause 49 of listing agreement. Separate reports on Corporate Governance and Management
Discussion and Analysis along with necessary certificates are given elsewhere in this
Annual Report as Annexure IV & V.


BUSINESS RESPONSIBILITY REPORT

Ministry of Corporate Affairs (MCA), Government of India has, in July 2011, issued
National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of
Business (Guidelines). The Guidelines list out nine principles and core elements on
ethics, transparency and accountability, sustainability, employee well being,
responsiveness towards stakeholders, promotion of human rights, environment protection,
influencing public policy, inclusive growth and equitable development, value to customers
and consumers.

jindal power limited (jpl), operating 1,000 mw (4 x 250 mw) power plant in raigarh
(chhattisgarh) has closed financial Year 2011-12 with a total sales of Rs. 3,040.35 crore
and earned a profit after tax of Rs. 1,764.99 crore.

The Companies in India are adviced to follow these Guidelines for reporting their
initiatives and activities relating to corporate social responsibilities (CSR). The
Company's vision, mission and core values enshrine these principles which are integral to
the business of the Company. The Company engages in elaborate CSR initiatives, conducts
business with transparency and accountability, looks after well being and protection of
the employees with a human face, is responsive to the needs of all its stakeholders and
takes care of quality of the products manufactured by it, gives priority to preservation
and protection of environment and prevention of pollution and believes that business is
also a medium to contribute to the social development. Initiatives undertaken during the
year under report in respect of corporate social responsibility, environment protection,
industrial relations and human resource management etc. are mentioned in detail in the
Management Discussion and Analysis Report which forms a part of this report as Annexure V.


AUDITORS

M/s S.S.Kothari Mehta & Co. (Firm Registration Number -0000756N), Auditors of the
Company hold office upto the conclusion of the ensuing Annual General Meeting. The Company
has received communication from them to the effect that their appointment, if made, would
be within the limits prescribed under Section 224(1B) of the Companies Act, 1956. They are
proposed to be appointed as Auditors of the Company for the financial year 2012-13.


DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under sub Section 2AA of Section 217 of the Companies Act,
1956, with respect to the Directors Responsibility Statement, it is hereby confirmed:-

i) that in preparation of the annual accounts for the financial year ended on 31st
March, 2012, the applicable accounting standards had been followed along with proper
explanations relating to material departures.

ii) that the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company at the end of the
financial year and of the profit of the Company for the year under report.

iii) that the Directors had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and by preventing and detecting fraud and other
irregularities.

iv) that the Directors had prepared the accounts for the financial year ended on 31st
March, 2012 on a 'going concern basis'.


APPRECIATION

Your Directors wish to place on record their gratitude for the valuable guidance and
support rendered by the Government of India, various State Government departments,
Financial Institutions, Banks and various stakeholders, such as, shareholders, customers
and suppliers, among others. The Directors also commend the continuing commitment and
dedication of the employees at all levels, which has been critical for the Company's
success. The Directors look forward to their continued support in future.


  

    

    
For and on behalf of the Board
  
  

    
Place: New Delhi
    
Naveen Jindal
  
  

    
Dated: 27th April, 2012
    
Chairman and Managing Director
  



ANNEXURES TO DIRECTORS' REPORT

ANNEXURE- I

Statement as at 31st March, 2012, pursuant to Clause 12 of the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999.


  

    
Sl. No.
    
Description
    
Remarks
  
  

    
A.
    
Options granted
    
During the year 2011-12 no stock options were granted to the employees and
    Wholetime Directors of the Company and its subsidiaries.
  
  

    
B.
    
Pricing formula
    
As approved by shareholders in their Annual General Meeting held on 25th
    July, 2005, price of shares arising on exercise of Options is equivalent to 75% of the
    average of the daily closing price of equity shares of the Company during 30 trading days
    preceding the date of grant of Options as quoted on the BSE Limited, (BSE) or the National
    Stock Exchange of India Limited (NSE) wherever the trading volume of equity shares in
    aggregate during the said period is more.
  
  

    
C.
    
Options vested
    
2,40,564 (Part III, Series II) 7,40,625 (Part III, Series III)
  
  

    
D.
    
Options exercised
    
5,64,787
  
  

    
E.
    
Total number of Ordinary Shares arising as a result of exercise of Options
    
2,40,564 equity shares of Rs. 1/- each allotted on 14th April, 2011;
    3,24,223 equity shares of Rs. 1/- each allotted on 12th December, 2011 aggregating to
    5,64,787 equity shares of Rs. 1/- each.
  
  

    
F.
    
Options lapsed
    
On account of leaving of service, due to resignation, retirement or
    otherwise, by the employees of the Company and its subsidiary, 4,16,402 stock options
    lapsed during the financial year 2011-12.
  
  

    
G.
    
Variation of terms of Options
    
NIL
  
  

    
H.
    
Money realised by exercise of Options
    
Rs. 2,89,19,035/- (Includes premium of Rs. 2,83,54,248/- )
  
  

    
I.
    
Total number of Options in force
    
Nil
  
  

    
J.
    
Details of Options granted to
    

  
  

    

    
i) Senior managerial personnel
    
NA
  
  

    

    
ii) Any other employees who received a grant in any one year of Options amounting to
    5% or more of the Options granted during that year.
    
NA
  
  

    

    
iii) Identified employees who were granted
    
NA
  
  

    

    
Options during any one year, equal to or exceeding 1% of the issued capital (excluding
    outstanding warrants and conversions) of the Company at the time of grant.
    

  
  

    
K.
    
Diluted Earnings per Share (EPS) pursuant to issue of Ordinary Shares on Exercise of
    Options calculated in accordance with Accounting Standard (AS) 20 'Earning Per Share.'
    
Rs. 22.58
  
  

    
L.
    
i) Method of calculation of employee compensation cost
    
The Company has calculated the employee compensation cost using the
    intrinsic value method of accounting to account for stock-based compensation cost as per
    the intrinsic value method for the financial year 2011-12.
  
  

    

    
ii) Difference between the employee compensation cost so computed at (i) above and the
    employee compensation cost that shall have been recognised if it had used the fair value
    of the Options.
    
The employee compensation cost would have been increased by Rs. 0.86
    crore.
  
  

    

    
iii) The impact of this difference on Profits and on EPS of the Company.
    
The effect of adopting the fair value method on the net income and
    earnings per share is presented below:
  
  

    

    

    

    
(Rs. in Crore)
  
  

    

    

    
Net Income, as reported
    
2,110.65
  
  

    

    

    
Add: Intrinsic Value Compensation Cost
    
(0.83)
  
  

    

    

    
Less: Fair value Compensation Cost (Black Scholes
    
0.03
  
  

    

    

    
Model)
    

  
  

    

    

    
Adjusted Net Income
    
2,109.79
  
  

    

    

    
Earning per share
    
Basic (Rs. )
    
Diluted (Rs. )
  
  

    

    

    
As reported
    
22.58
    
22.58
  
  

    

    

    
As adjusted
    
22.57
    
22.57
  
  

    
M.
    
Weighted average exercise price and weighted average fair value of Options granted for
    
Options granted whose exercise price is less than the market price of the
    stock (adjusted for stock split):
  
  

    

    
Options whose exercise price either equals or exceeds or is less than the market price
    of the stock.
    
Weighted average Exercise Price
    
NA
  
  

    
 
 
    
 
 
    
Weighted average fair value
    
NA
  
  

    
N.
    
A description of the method and significant assumption used during the year to
    estimate the fair value of Options
    
The fair value of each option estimated using the Black Scholes Options
    Pricing Model after applying the following key assumptions:
  
  

    

    

    
i) Risk free interest rate
    
NA
  
  

    

    

    
ii) Expected life
    
NA
  
  

    

    

    
iii) Expected volatility
    
NA
  
  

    

    

    
iv) Expected dividend
    
NA
  
  

    

    

    
v) The price of the underlying shares market at the time of options grant
    
in NA
  


 


  

    

    
For and on behalf of the Board
  
  

    
Place: New Delhi
    
Naveen Jindal
  
  

    
Dated: 27th April, 2012
    
Chairman and Managing Director
  



ANNEXURE - II

Particulars required under the Companies (Disclosure of Particulars in the Report of
Board of Directors) Rules, 1988


A. CONSERVATION OF ENERGY

a) Energy conservation measures taken:

1. Changing of motor connection from delta to star of FD fans of WHRB boilers of 3x25
MW power plants.

2. Shifting of 23 kVA lighting load to the MLDB 1&2 (TG-3M - with lighting energy
saver) from MLDB 1&2 (TG-3M - without saver) in 3x25 MW power plants.

3. Operated one transformer out of the two identified transformers having tie breakers
to reduce losses in 3x25 MW power plants.

4. Replacement of higher size raw water pump to appropriate smaller size in 2x55 MW
power plant.

5. Installation of CFL lights (36 Watts, 80 nos.) in the sheds to meet lighting
requirement during holidays and plant shutdown hours in place of lighting all the highbay
luminaries (400 Watts, 420 nos.).

6. Installation of new smaller size annealing furnace for heat treatment of small lot
sizes of material (Capacity 5mtr. X 3 mtr. x 2.8 mtr.--20T) in place of running small lot
sizes in big annealing furnace ( Capacity 7mtr. X 5 mtr. x 4.5 mtr.--40T).

7. Installation of lighting T/R in AHP of 2 x 25 MW power plant.


b) Additional investments and proposals, if any, being implemented for reduction of
consumption of energy:

1. Installation of Beblac light energy saver of 150 KVA to reduce lighting voltage in
2x25 MW power plant.

2. Installation of lighting timers in lighting SLDB's of 2x25 MW power plant.

3. Segregation of coke products by coke route modification in coke oven plant.

4. Installation of soft starter in quenching pumps in coke oven plant.

5. Modification of wharf discharge mechanism in coke oven plant.

6. Changing of raw water pump motor from existing 180 KW to 132 KW as per the
requirement in Blast furnace-2.

7. Inclusion of Variable Voltage and Variable Frequency Drive in stock house
vibrofeeders (16nos-12X1.67kw &4X2.67kw) to reduce energy consumption at Blast
Furnace-1.

8. Online Nucleonic Moisture Transmitter in Coke Bunkers for reduction in coke
consumption in stock house of Blast Furnace-1.

9. Installation and commissioning of 15 KW solar photovoltaic power plant at a cost of
Rs. 16.47 lacs for meeting requirement of 11 hrs. lighting on street between material gate
to workshop (load 3.75 KW).


c) Impact of the measures at (a) and (b) for reduction of energy consumption and
consequent impact on the cost of production of goods:

1. Electrical power saving of 27 KW/hr is achieved in total 8 nos. of FD fans.

2. Electrical power saving of 3.0 KW/hr is achieved due to shifting of lighting load.

3. Electrical power saving of 15.5 KW/hr is achieved due to operation of one
transformer.

4. Electrical power saving of 15 KW/hr is achieved due to installation of lighting
transformer.

5. Reduction of energy consumption for shed lighting is approx. 55,351 KWHs from
October, 2011 to March, 2012.

6. Reduction of fuel consumption approx. 34 Ltrs. / ton of metal heat treated in
smaller size annealing furnace in place of large size annealing furnace.

7. Energy generation through Solar power for street lights (Per day consumption 41.25
KWHs approx.). Reduction in import of power from state electricity distribution company
(approx. 15,056 KWHs per annum).


d) Total energy consumption and energy consumption per unit of production:

As per Form A given hereafter


FORM A

Form for disclosure of particulars with respect to Conservation of Energy


a. Power and fuel consumption


  

    

    
Current Year
    
Previous Year
  
  

    
I. Electricity
    

    

  
  

    
(a) Purchased
    

    

  
  

    
Unit in ('000 Kwh)
    
3,90,003.36
    
2,67,825.38
  
  

    
Total amount (Rs. in lacs)
    
19,748.46
    
12,413.33
  
  

    
Rate/Unit (Rs. )
    
5.06
    
4.63
  
  

    
(b) Own generation
    

    

  
  

    
i) Through diesel generator
    

    

  
  

    
Units ('000 Kwh)
    
1,077.16
    
25,373.17
  
  

    
Units per ltr. of diesel Oil
    
2.56
    
3.19
  
  

    
Cost / unit (Rs. )
    
16.88
    
13.20
  
  

    
ii) Through steam turbine / generator
    

    

  
  

    
Units (in '000 Kwh)
    
30,44,235.39
    
25,14,277.12
  
  

    
Units per ltr. of fuel Oil / Gas
    
NIL
    
NIL
  
  

    
Cost / unit (Rs. )
    
NA
    
NA
  
  

    
II. Coal
    

    

  
  

    
(a) Non Coking Coal*
    

    

  
  

    
Quantity (MTs)
    
69,46,609.03
    
55,04,543.91
  
  

    
Total cost (Rs. in lacs)
    
93,283.04
    
54,841.36
  
  

    
Average rate / MT (Rs. )
    
1,342.86
    
996.29
  
  

    
(b) Coking Coal**
    

    

  
  

    
Quantity (MTs)
    
10,70,586.70
    
11,33,058.00
  
  

    
Total cost (Rs. in lacs)
    
1,36,104.26
    
1,10,635.00
  
  

    
Average rate / MT (Rs. )
    
12,713.05
    
9,764.29
  
  

    
III. Coke
    

    

  
  

    
Quantity (MTs)
    
1,37,531.80
    
1,34,888.00
  
  

    
Total cost (Rs. in lacs)
    
20,518.40
    
18,584.00
  
  

    
Average rate / MT (Rs. )
    
14,919.02
    
13,778.00
  
  

    
IV. Furnace Oil
    

    

  
  

    
Quantity (K. ltrs)
    
1,18,678.06
    
1,02,843.00
  
  

    
Total cost (Rs. in lacs)
    
47,757.51
    
32,333.00
  
  

    
Average rate / Ltr (Rs. )
    
40.24
    
31.44
  
  

    
V. Others internal generation
    

    

  
  

    
Quantity
    
NIL
    
NIL
  
  

    
Total cost (Rs. in lacs)
    
NA
    
NA
  
  

    
Average rate / Kg. (Rs. )
    
NA
    
NA
  


*Used in the manufacturing of Sponge Iron / Power Plant.

**Used in Coke oven and ultimately consumed in Blast Furnace.


b. Consumption per unit of production


  

    

    
Current Year
    
Previous Year
  
  

    
I. Electricity
    

    

  
  

    
For Sponge Iron Mfg. (unit / ton)
    
75.50
    
73.11
  
  

    
For Silico Magenese Mfg. (unit / ton)
    
3,966.15
    
4,564.90
  
  

    
For Slabs / Rounds / Beam /Blank Mfg. (unit / ton)
    
513.40
    
524.13
  
  

    
For Rails / Beams / Channels Mfg. (unit / ton)
    
145.99
    
173.03
  
  

    
For Plate / Coil Mfg. (unit / ton)
    
121.16
    
116.00
  
  

    
For Wire Rod (unit / ton)
    
229.02
    
314.54
  
  

    
For TMT Bar (unit / ton)
    
393.05
    
NIL
  
  

    
For Medium Light Section (unit / ton)
    
173.24
    
354.01
  
  

    
For Cement (unit / ton)
    
55.20
    
63.37
  
  

    
For Steel melting (Ingots & Casting) (unit / ton)
    
1,261.00
    
1,225.44
  
  

    
For Machine / Machinery parts Mfg. (unit / ton)
    
501.00
    
507.58
  
  

    
For Pellet (unit/ ton)
    
61.35
    
60.44
  
  

    
II. Fuel Oils
    

    

  
  

    
For Sponge Iron Mfg. (litre / ton)
    
NIL
    
NIL
  
  

    
III. Coal
    

    

  
  

    
For Sponge Iron Mfg. (mt. / ton)
    
1.36
    
1.37
  
  

    
For Silico Magenese Mfg. (mt. / ton)
    
0.69
    
0.39
  
  

    
For Power Plant (Kg / Kw)
    
0.98
    
0.95
  



B. TECHNOLOGY ABSORPTION

Efforts made in technology absorption as per Form B given below


FORM B

(Form for disclosure of particulars with respect to absorption)


Research and Development (R&D):

A. Specific areas in which R&D carried out by the Company:

1. Commissioning of new section 350 mm Dia cast round for seamless line pipe
application.

2. Development of Ultra Low Sulphur Steel round of 200 mm dia with sulphur content
0.0015% max for line pipe application.

3. Study on root cause and remedial measures for occurence of fish cracks in plates in
collaboration with IIT Kanpur.

4. Development of boiler quality grade (ASTM A516Gr 70) with impact guarantee of 27 J
at -46 degC up to 63mm plate thickness.

5. Study on the effect of tundish argon gas diffuser on steel cleanliness.

6. Development of ultra low sulphur steel (S<0.002%) for API plates.

7. Study on root cause and remedial measures on formation of Rolled Burr Pits (RBP) in
parallel flange beams.

8. Development of structural grade E410 in accordance with IS 2062: 2006 in section UB
457 X 152mm.

9. Development of sheet pile (Larson IV).

10. Development of medium light structurals (channels, angles and beams) in following
sections: Channel: 125-200mm, Angle: 100-200mm, Beam: 180 & 200mm.

11. Trial development of lead steel (12L14) for wire rod application.

12. Installation of hearth monitoring system in Blast Furnace.

13. Blending non coking coal with coking coal for coke production without deteriorating
the coke quality for Mini Blast Furnace.

14. Establishing the standard deviation and variation of CSR and CRI results between
Main and Pilot Coke Oven.

15. Development of API X70 grade in coils up to 12 mm thickness.

16. Reducing the carbon rate in production of Silico Manganese in SAF.


B. Benefits derived as a result of the above R&D:

1. New section developed to cater to the customer requirements in the field of seamless
line pipe application.

2. New grade developed to cater to the stringent quality requirements of the customers
for critical line pipe application with extra low sulphur content.

3. The reduction in defects will reduce the rework cost. The dispatch schedule will not
get hampered due to elimination of rework activity on plates.

4. By development of this new grade the Company is now able to supply special quality
plates in a new market segment.

5. A detailed report was generated on trial conducted at slab caster of the Company and
suggested to supplier for further modification in flow pattern to improve the product
quality.

6. The Company is in a position to supply plates in new market segment with stringent
quality standards.

7. Based on data analysis and observations, recommendations were given to minimise RBP
in structurals.

8. The Company is in a position to supply Beams in new market segment with stringent
quality standards.

9. The Company is in a position to supply Sheet Piles for new market segment with
stringent quality standards.

10. The Company is in a position to supply Medium Light structural grades for new
market segment with stringent quality standards.

11. New grade (12L14) has been developed to cater to the business in a new market
segment. "Free Cutting Steel - 12L14" has been developed which is widely used as
Machining quality steel grade.

12. The hearth monitoring system was installed in Blast Furnace-2 which helps in
controlling the PCI injection rate and oxygen flow through tuyers. It also helps in
continuous monitoring of the inside refractory wall pattern in hearth.

13. This has led to considerable saving till now and will also generate future savings.

14. Trials confirm that average CSR of coke from pilot coke oven is 4 points lesser
than Main coke oven and similarly average CRI of coke from Pilot coke oven is 4 points
higher than Main coke oven. With the help of these results, trials can be conducted at
pilot coke oven with the help of which the values would be predicted at main coke oven
with a higher precision.

15. The Company is in a position to supply plates in a very prestigious market segment
with stringent quality standards.

16. Specific coal consumption (per ton) reduced.


C. Future Plan of Action:

1. Study on reduction of ovality in cast rounds.

2. Analysis of MMR of individual and blended coking coal for coal characterisation and
establishing the relationship to predict CSR and CRI of coke.

3. Study the root cause of formation and remedial actions for accretion formation in
DRI kilns with collaboration of National Council for Cement and Building Materials,
Ballabhgarh.

4. Establishing the correlation between CSR - CRI results of Pilot Coke Oven and
Commercial non recovery Coke Oven.

5. Optimisation of maximum percentage use of non coking coal in blending of coking coal
through pilot coke oven study to reduce the production cost.

6. Commissioning of slag detection system and study its effect on steel quality.

7. Study on the enhancement of the Roll campaign life.

8. Study on root cause analysis and remedial measures for centerline cracks in billets
in low carbon grades.

9. Recycling and reuse of formed accretion in coal based DRI Kilns.

10. Study the Apex radius at MLSM.


D. Expenditure on R&D during 2011-12:


  

    
a. Capital
    
: Rs. 2.51 crore
  
  

    
b. Recurring
    
: Rs. 6.46 crore
  
  

    
c. Total
    
: Rs. 8.98 crore
  


d. Total R&D expenditure as a percentage of total turnover : 0.07% (turnover
13,270.67 crore)


Technology Absorption, Adaptation and Innovation:

a) Efforts in brief, made towards technology absorption, adaptation and innovation and
benefits derived as a result:

1. Development of safe and standard mechanism for Tuyers Pulling in Blast Furnace.

2. Eliminating unwanted stoppage due to Pinch Roll in Plate Mill.

3. Realisation of burnt lance pipe in Blast Furnace.

4. Coke Flow control device in Coke oven.

5. Development of online replacement methodology of hearth spray cooling header in
Blast Furnace.

6. Minimising deviation in product quality due to sagging of Coal Throw Pipe in DRI.

7. Modification in flow meter in transport air line in PCI in Blast Furnace.

8. Boost production (quality & quantity) via innovative wireless system for kiln
temperature monitoring in DRI.

9. Process improvement for productivity & waste utilisation in DRI.

10. Process improvement for productivity of CTL-1 by innovative idea with in-house
material utilisation in Plate Mill.

11. Innovative practices for longer sequence in Slab Caster in SMS.

12. Add new gauge led display board in FM area in Plate Mill.


b) In case of imported technology (imported during the last 5 years reckoned from the
beginning of the financial year) following information may be furnished.

1. Technology Imported:


  

    
2007-08
    
2008-09
    
2009-10
    
2010-11
    
2011-12
  
  

    
1) RH degasser
    
1) 100T Electric Are Furnace, Ladle Furnace and FES from Sarrale, Spain
    
1) Medium Light Structural Mill supplied by M/S Danielle
    
1) New straightening machine installed to straighten Beams beyond 700mm. Technology
    and equipment supplied by SM S_Meer
    
NIL
  
  

    

    

    
2) Slag grinding unit for production of cement using fly ash and blast furnace slag
    

    

  



2. Year of import: as given above

3. Has technology been fully absorbed Rs. Yes

4. If not fully absorbed, areas where this has not taken place, reasons thereof and
future plan of action: N/A

FOREIGN EXCHANGE EARNINGS AND OUTGO

a. Activities relating to Export:

I) INITIATIVES TAKEN TO INCREASE EXPORT:

Further to the initiatives taken in 2010-11 to improve upon the offering of the
Company's products in the export markets, significant progress was achieved in various
areas.

The total tonnage of steel products exported in the year 2011-12 was 2,69,000 MT
against 2,00,000 MT last year registering a Year on Year growth of 34%. Last year we could
capture significant market share in the neighbouring countries of the Indian subcontinent
including Nepal, Bangladesh and Sri Lanka. Against the general trend of lower
international prices visa-vis the domestic market, prices in the neighbouring countries
usually being governed by the domestic market sentiments are more remunerative. Further,
the lower freight incidence for these markets compared to those for EU and MENA regions
make them more attractive markets for exports.

In the cast round market internationally, which forms a large percentage of total
exports, this year the Company exported higher quantities of value added alloy grades over
the last year. Further while the Company generated more business in the Seamless Pipe
Industry, the Company has also been successful in tapping into overseas forging industry.
More efforts will be made in this direction so that the Company is perceived as a producer
of value added steel and is able to carve out a niche in the international market.

Another significant development has been restrengthening of the Company's presence in
the MENA region for structural section product range. A renewed effort has been directed
at promoting medium and heavy parallel flange beams and columns for which MENA region
offers a natural market. The Company has been able to consistently register sales of
structural sections last year in this region, clocking 15,000 MT sale during second half
of the financial year 2011-12. The endeavour is to reach a level of approximately 5,000 MT
per month of sales on a consistent basis in the coming year.

Regarding the development of rail business, while the order of Iranian Railways system
continued to be serviced during the year, discussions are underway for supply of rails to
other countries including Ethiopia, Brazil, Saudi Arabia and Tunisia with many being in
advance stages of sales cycle. Experience gathered from supply of rails to Iranian
Railways System and aforesaid new avenues will enable the Company to obtain international
recognisation and certifications for development of rail business.

Last but not the least, establishment of a separate port recognition and ship
chartering desk at the Company has enabled it to streamline shipping operations and
commence a gradual shift of the business terms from FOB to CNF, which, going forward, will
be important in attracting greater buyer interest from the international market.


II) DEVELOPMENT OF NEW EXPORT MARKET FOR PRODUCTS AND SERVICES AND EXPORT PLANS:

This year the Company intends to have a special focus on the MENA region. As per World
Steel Association, steel use in MENA is forecast to resume growth in 2012 at a rate of
7.9%. Other markets of special interest will include countries in Latin America and South
East Asia region. The focus on MENA region will be aided by setting up of a service center
in Dubai and increasing the Company's presence through new offices in the region to
strengthen the end customer base.

The Company's upcoming state-of-the-art Plate Mill facility at Angul which is equipped
with latest wide plate rolling, finishing and heat treatment facilities, will enable the
Company to tap value added plate segment in the international market. Advance production
capabilities combined with proximity to a port location makes it ideal for the high end
plate export market.


b. Total Foreign Exchange used and earned


  

    
I) FOREIGN EXCHANGE USED
    
: Rs. 256.83 crore
  
  

    
II) FOREIGN EXCHANGE EARNED
    
: Rs. 1,428.84 crore
  


 


  

    

    
For and on behalf of the Board 
  
  

    
Place: New Delhi
    
Naveen Jindal
  
  

    
Dated: 27th April, 2012
    
Chairman and Managing Director