To the Members,
Your Directors take pleasure in presenting the 6th Integrated Report
[prepared as per Integrated Reporting <IR> framework of the International Integrated
Reporting Council (IIRC) (now consolidated into IFRS Foundation)] and the 33rd
Annual Accounts on the business and operations of Tata Metaliks Limited ('TML' or'
Company') for the financial year ('FY') ended March 31,2023.
A. Financial Results
|
|
(Rs. crore) |
| Particulars |
Financial Year 2022-23 |
Financial Year 2021-22 |
| Revenue from Operations |
3,259.57 |
2745.53 |
| Total Expenditure before Finance Cost, Depreciation |
3,062.48 |
2367.50 |
| Operating Profit |
197.09 |
378.03 |
| Add: Other Income |
13.64 |
16.65 |
| Profit before Finance Cost, Depreciation and Taxes |
210.73 |
394.68 |
| Less: Finance Costs |
32.74 |
24.50 |
| Profit before Depreciation and Taxes |
177.99 |
370.18 |
| Less: Depreciation and Amortization Expenses |
77.29 |
61.69 |
| Profit before Exceptional Items |
100.70 |
308.50 |
| Exceptional Items |
- |
30.83 |
| Profit before Tax |
100.70 |
33932 |
| Less:Tax Expenses |
20.15 |
101.26 |
| (A) Profit after Tax-from Continuing Operations |
80.54 |
238.06 |
| (B) Loss after Tax - from Discontinued Operations |
- |
(0.61) |
| (c) Profit for the Year (A+B) |
84.14 |
237.45 |
| (D) Other Comprehensive Income net ofTax |
(1.08) |
0.40 |
| (E) Total Comprehensive Income for the Year (C+D) |
83.06 |
237.85 |
| Retained Earnings: Balance Brought Forward from the Previous Year |
925.22 |
700.01 |
| Add: Profit for the Period |
80.54 |
237.45 |
| Add: Other Comprehensive Income Recognized (in Retained Earnings) |
(1.08) |
0.40 |
| Add: Other Movements within Equity |
- |
- |
| Balance |
1,004.70 |
937.85 |
| Which the Directors have apportioned as under to: |
|
|
| (i) Dividend on Ordinary Shares |
25.26 |
12.63 |
| (ii) Tax on Dividend |
- |
- |
| Retained Earnings: Balance to be Carried Forward |
979.43 |
925.22 |
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') formulated
and adopted the Dividend Distribution Policy (the 'Policy').
The Policy is available on our website at https://
www.tatametaliks.com/static-files/pdf/policies/ dividenddistributionpolicv.pdf
2. Dividend
The Board has recommended a dividend of Rs.5/- per Equity Share on 3,15,77,500 Equity
Shares of Rs.10/- each for FY 2022-23 (previousyear Rs.8 per Equity Share on 3,15,77,500
Equity Shares of Rs.10/-each). The Board has recommended dividend based on the parameters
laid down in the Dividend Distribution Policy and the dividend will be paid out of the
profits for the financial year.
The dividend on equity shares is subject to the approval of the Members at the ensuing
Annual General Meeting ('AGM') scheduled to be held on Wednesday, August 30,2023
and will be paid on and from Monday, September 04, 2023.
The dividend, if approved, would result in a cash outflow of T15.79 crore. The total
dividend outgo works out to 19.60% (FY 2021-22:10.64%) of the net profits.
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 Transfer Books of the Company will remain closed from
Saturday, August 19, 2023 to Wednesday, August 30, 2023, (both days inclusive) for the
purpose of payment of dividend and the AGM for the financial year ended March 31, 2023.
3. Transfer to Reserves
The Board has decided to retain the entire amount of profit for the Financial Year
2022-23 in the statement of profit and loss and no amount is proposed to be transferred to
the general reserves.
4. Capex and Liquidity
During the year under review, the Company incurred capital expenditure of around Rs.167
crore, which has been funded through internal accruals. Despite adverse impacts of
geopolitical crisis and price volatilities having far reaching impact on input costs and
narrowing margins, the Company successfully managed its liquidity situation and ended the
year with a cash surplus of Rs.206 crore along with undrawn lines of both fund-based and
non-fund based limits, sanctioned by Banks.
5. Management Discussion and Analysis Report
The Management Discussion and Analysis Report, in compliance with Regulation 34(2)(e)
of SEBI Listing Regulations, forms an integral part of this report and is annexed herewith
as (AnnexureA).
B. Integrated Report and Business Responsibility and Sustainability Report
In line with the Company's commitment to stakeholders to adopt sustainable business
practices, we transitioned from a compliance-based reporting to the governance-based
reporting by adopting the Integrated Report <IR> framework of the International
Integrated Reporting Council (IIRC) (now consolidated into IFRS Foundation).
Our 6th <IR> not only highlights our value creation process woven around our six
business pillars but also provides enhanced disclosures around our business model,
material issues and stakeholders. Environment Social and Governance (ESG) outcomes,
response to external challenges, value creation outcomes, and risk management and
governance aspects.
The enhanced disclosures are in line with our commitment to enhance accountability and
promote a transparent approach to corporate reporting.
In accordance with Regulation 34(2)(f) of the SEBI Listing Regulations, the Securities
and Exchange Board of India ('SEBI'), in May 2021, introduced new sustainability
related reporting requirements to be reported in the specific format of Business
Responsibility and Sustainability Report ('BRSR'). BRSR is a notable departure from
the existing Business Responsibility Report and a significant step towards giving platform
to the companies to report the initiatives taken by them in areas of Environment, Social
and Governance. Further, SEBI has mandated top 1,000 listed companies, based on market
capitalisation, to transition to BRSR from FY 2022-23 onwards. We had voluntarily
presented our BRSR for FY2021-22 last year. We are glad to present our second BRSR for
FY2022-23.
C. Operations and Performance
Financial & Operational Performance
FY 2022-23 has been a year of challenges and resilience. Pig Iron (PI) demand, which
showed signs of recovery in Q4 FY 2021-22, remained largely depressed throughout the
Fiscal coupled with downward price corrections. Utilization levels dropped to as low as
50-70% among major foundry clusters. The Fiscal year started with a high export duty on
iron & steel products, dampening demand severely. There was hardly any export from
India in Q2 due to imposition of export duty of 15% in May 2022. Although the duty was
withdrawn in mid-November 2022, the over-supply situation in domestic market continued for
the entire financial year.
On the Ductile Iron Pipe (DlP) business, after dispatches and prices both peaking in Q4
FY 2021-22, there was significant drop in Q1 FY 2022-23 and the situation remained largely
similar till Q2 FY 2022-23. Prices started to strengthen in Q3 FY 2022-23 onwards and
dispatches improved steadily, ending the year with the highest ever dispatch of 296 kt
(237 KT in FY 2021-22) for the Company.
Despite various challenges and price volatility, the Company remained resilient and
continued to focus on its operational performance with increased operational efficiencies
in the areas of power generation and production of Hot Metal, Coke and DIP. The continued
focus on improvement initiatives and agile procurement strategies could partially mitigate
the adverse impact of rise in input costs and the Company achieved an EBITDA from
Operations of Rs.210.73 crore (FY 2021-22: Rs.394.68 crore) and Profit Before Tax (PBT) of
Rs.100.70 crore (FY 2021-22: Rs.339.32 crore).
D. Key Developments
1. Change in Capital Structure
There has been no change in the capital structure of the Company during the year under
review.
The Equity Share Capital of the Company is ^31,57,75,000 divided into 3,15,77,500
Equity Shares of Rs.10/-each as on the close of the FY 2022-23.
2. Amalgamation
a) Withdrawal of Scheme of Amalgamation of Tata Metaliks Limited into and with Tata
Steel Long Products Limited
The Board of Directors of the Company, at its Meeting held on September 22,2022,
considered and approved withdrawal of the Scheme of Amalgamation of the
Company into and with Tata Steel Long Products Limited, owing to significant changes in
underlying business conditions of both the companies resulting in dilution of the inherent
benefits which were initially envisaged.
b) Scheme of Amalgamation of Tata Metafiles Limited into and with Tata Steel Limited
The Board, at its meeting held on September 22,2022, approved the scheme of
amalgamation of the Company into and with its holding Company i.e. Tata Steel Limited ('Scheme').
The Board has recommended a share exchange ratio of 79 fully paid-up equity shares of
nominal value of Rs.1/- each of Tata Steel Limited ('TSL') for every 10 fully
paid-up equity shares of nominal value of Rs.10/-each held by the public shareholders of
the Company. As part of the Scheme, the equity shareholding of TSL in the Company shall
stand cancelled. The Company has received the 'observation letter1 dated March
31, 2023 from the National Stock Exchange of India Limited ('NSE') and BSE Limited ('BSE')
and has filed an application before the Hon'ble National Company Law Tribunal, Kolkata
Bench for necessary directions.
The amalgamation is subject to approval from the shareholders and other regulatory/
governmental authorities.
3. Credit Rating
The Company enjoys a sound reputation for its prudent financial management and its
ability to meet financial obligations. The credit rating of the Company for long-term
stands was upgraded during the year and stands at [ICRA] AA and short-term facilities
stands at [ICRA] A1+. The details of Credit Ratings are provided in Corporate Governance
Report.
E. Sustainability
The Company's philosophy of sustainable value creation is deep rooted with the core
values of the Tata Group. Underpinning this philosophy is a strong focus on zero harm
along with resource efficiency and circular economy, minimizing carbon footprint and care
for community and workforce. This is ensured through a broad spectrum of focused
interventions in areas of environment management, water sustainability, carbon emission
reduction and community development.
Our commitment to serve our stakeholders is deployed by the linkage of our business
priorities with United Nations Sustainable Development Goals ('UN SDGs'). The
Company has set in motion a roadmap towards carbon neutrality, enhancing value proposition
on circular economy, implementing renewable/ alternate energy sources and higher carbon
pricing for revenue and capital decisions, to name a few.
Various initiatives taken in the last fewyears have not only improved our ESG
performance but also improved the lives of the focused communities. External voluntary
assessments by leading institutes and independent agencies, internal benchmarking study of
ESG practices to acknowledge and adopt the best practices and materiality assessment help
us regularly calibrate our interventions in our sustainability journey. The Company
continued to make its carbon emission disclosure directly under Carbon Disclosure Project
(CDP) for its stakeholders. We are pleased to report that we received "B" Rating
in Climate Change Disclosure, an improvement of 4 levels from last year's rating. The
Company also received "A"- Rating in CDP-Supplier Engagement Rating (SER); an
improvement of three bands over the previous year.
During the year, we embarked on a renewed effort to recalibrate our decarbonization
journey. We are engaging with a reputed global team of professionals to help us
recalibrate our decarbonisation efforts, identify focussed levers of decarbonization, to
achieve our targets of Carbon neutrality.
The Company continues to be committed to serve its customers through a portfolio of
products and disclosure of the environmental impact of its products by using the Life
Cycle Assessment ('LCA') methodology. Some of the key interventions on the
sustainability front undertaken by the Company include setting up of the second solar
power plant and a solar water heating system, increased local community development in the
areas of Education and Essential amenities, operating a Skill Development Centre, and the
sustained effort towards the flagship 'TML 300 Schools' project to name a few.
Environment & Climate Change
The Company sustains its continuing journey towards minimizing environmental impact of
its operations. In line with the Tata Group core values, concern for environment under the
strategic business pillar of'Responsible Corporate Citizenship' is deeply embedded in
Company's vision and strategy. The Company has implemented environment, health and safety
management systems in accordance with standards ISO 14001, ISO 45001 and SA 8000, which
provides the necessary framework for managing compliance and improving environmental
performance. The Safety, Health & Environment Committee of the Board provides
oversight and necessary guidance on environmental matters. The manufacturing plant at
Kharagpur operates in harmony with environment, based on the principles of Reduce, Reuse
and Recycle.
Climate change is one of the most pressing issues the world faces today and the Company
recognizes the same and is committed to optimise water consumption, reduce waste, and
reduce carbon and energy footprints. The drive towards renewable energy and minimizing
emissions is reflected in its various initiatives- setting up another Solar Power Plant,
continued adoption of Electric Vehicles (EVs) inside the plant and several efforts towards
sustainable business practices.
Safety and Health
The Company under the guidance of the Safety, Health and Environment (SHE) Committee
remains committed to its objective of achieving 'Zero Harm' through its strategies that
include Contractor Safety Management, Process Safety, Risk- based thinking and
transforming the mindset of employees to enhance Behavioural Safety. During the year under
review, renewed thrust was made on Risk-based Safety approach by eliminating or reducing
high risk activities through engineering controls and automation. Further, behaviour-
based culture study was conducted to understand Safety
Maturity Index Level. Efforts towards Hazard Identification and Risk Assessment (HIRA)
in new recalibrated HIRA matrixand implementation of Process Safety Risk Management (PSRM)
in critical processes are helping develop a Risk- based approach to Safety, to give thrust
to achieving the ultimate goal of 'Zero Harm'.
Customer Relationship
Customer-centricity forms the core of Company's strategic business pillar of
"Supplier of Choice". The Company's marketing strategy is built around
developing deep customer engagement, differentiated product & service offerings and
leveraging digital to improve the customer experience journey. During the year, the
Company continued to engage with customers and offered technical services and technical
webinars with both, domestic and international customers, further leveraging the knowledge
capital.
The Company's digital initiatives has served as a big differentiator in the market
place and helped the Company to develop stronger relationships with customers. Regular
usage of data analytics tools such as pricing analytics has helped the Company in
sharpening its pricing strategy. During the year, various technical webinars, technical
services and onsite interactions were carried out to facilitate promotion.
During the year, the Company also forayed into monetizing its technical services. The
new initiative is aimed at increasing the brand visibility of the Company's product
portfolio as we increase our service offerings in various segments in the fast growing
water infrastructure industry.
Corporate Social Responsibility
The Corporate Social Responsibility ('CSR') initiatives of the Company aligned
with the core purpose of the Tata Group and embodied across the value chain. The Company
is committed to improving the quality of life of the community through longterm value
creation for all its stakeholders.
The Company continued with its focused interventions in the areas of Education and
Essential Amenities which include projects on health, sanitation, water conservation and
sustainability. Further, the Company also engaged with the community to develop
entrepreneurs through formation of self-help groups in partnerships with other
organisations.
The Company has partnered with Tata Strive to impart quality training at its Skill
Development Centre with the objective of making the youth employable.
The CSR activities are carried out through 'Sadbhavna Trust'. In terms of Section 135
of the Companies Act, 2013 ('Act') and the Rules framed there under, brief outline
of the CSR policy and the prescribed details are part of the Annual Report on CSR
activities annexed to this report as (Annexure B). The CSR Policy can be viewed at https://www.tatametaliks.com/static-files/pdf/policies/
Corporate-Social-Responsibilitv-Accountabilitv-Policv.pdf. For other details, please
refer to the Corporate Governance Report, which forms part of this report.
The Company continues its concerted efforts on water sustainability through focused
interventions including reduction in water consumption, creating water conservation &
harvesting structures, deepening of ponds, etc., in and around the plant. In line with the
objective of making water available to the community, the Jal se Jeevan project saw
further progress during the year with excavation of several rainwater capturing ponds and
infrastructure.
During the year under review, employees of the Company clocked 7,191 Volunteering (EV)
hours in the service of the community. A sum of Rs.681.50 lakhs was contributed to the
Sadbhavna Trust for CSR and Affirmative Action initiatives against the minimum statutory
requirement of Rs.544.89 lakhs for the year under review.
F. Corporate Governance
Guided by the tenets of transparency and openness, the governance approach focuses on
the effective working of the Management and the Board, while ensuring that corporate
behaviour remains responsible. We consider it our inherent responsibility to disclose
timely and accurate information regarding the operations and performance, leadership, and
governance of the Company. The Company remains committed to raise the bar in adopting and
adhering to transparent and ethical corporate governance practices. The practices reflect
the Tata Group's values and ethos, organization culture, polices and the relationship with
various stakeholders. As a responsible organization, timely and accurate disclosure in
respect to Company's operational performance, material corporate events as well as on
leadership and governance is done for the interest of all stakeholders.
Pursuant to the SEBI Listing Regulations, the Corporate Governance Report along with
the Certificate from a Practicing Company Secretary, certifying compliance with conditions
of Corporate Governance, forms part of this Integrated Report & Annual Accounts
2022-23 at (Annexure C).
1. Meetings of Board and Committees of Board
The Board met 5 (five) times during the year under review.
The intervening gap between the meetings was within the period prescribed under the
Companies Act, 2013 and the SEBI Listing Regulations. The Committees of the Board usually
meet prior to the Board meeting, or whenever the need arises for transacting business.
Details of composition of the Board and its Committees as well as the meetings held during
the year under review and the Directors attending the same are provided in the Corporate
Governance Report forming part of this Report.
2. Selection of New Directors and Board Membership Criteria
The Nomination and Remuneration Committee ('NRC') engages with the Board to
evaluate 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. The NRC,
based on such evaluation, determines the role and capabilities required for appointment of
Independent Director. 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 a well-defined policy for appointment of Directors, Key Managerial
Personnel (KMP) and other employees including their remuneration. The NRC recommends
suitable candidates to the Board, based on their qualifications, positive attributes and
experiences for Board Membership. 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.
The Policy is available on our website at https://www.
tatametaliks.com/static-files/Ddf/Dolicies/TML-NRC-Dolicv.pdf.
3. Familiarization Programme for Directors
As a practice, all new Directors (including Independent Directors) inducted to the
Board go through a structured orientation programme. Presentations are made by Senior
Management giving an overview of the operations, to familiarize the new Directors with the
Company's business operations. The new Directors are given an orientation on the products
of the business, Board constitution and procedures, matters reserved for the Board, and
the major risks and risk management strategy of the Company. In compliance with the
provisions of the SEBI Listing Regulations, the Company facilitates various programmes/
awareness sessions for Independent Directors.
Details of the familiarization programmes given to the new and existing Independent
Directors in the areas of strategy/ industry trends, operations & governance, and
safety, health and environment initiatives are provided in the Corporate Governance
Report, annexed herewith, and the policy as adopted by the Company is also available on
our website at https://www.tatametaliks.com/static-files/pdf/policies/policv-
proa-director.pdf
During FY 2022-23 no new Independent Director was inducted to the Board.
4. Board Evaluation
The Board evaluated the effectiveness of its functioning, of the Committees and of
individual Directors, pursuant to the provisions of the Act and the SEBI Listing
Regulations. The Board carried out an annual evaluation of its own performance, the
performance of the Independent Directors individually as
well as an evaluation of the working of the Committees of the Board. The performance
evaluation of all the Directors was carried out by the Nomination and Remuneration
Committee. The performance evaluation of the Chairman and the Non- Independent Directors
was carried out by the Independent Directors, pursuant to the provisions of the Act and
SEBI Listing Regulations.
The Board sought the feedback of Directors on various parameters including:
- Degree of fulfilment of responsibilities towards key 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 5, 2017.
The Chairman of the Board had one-on-one meeting with the I ndependent Directors ('IDs')
and the Chairman of NRC had one-on-one meeting with the Executive and Non-Executive,
Non-Independent Directors. These meetings were intended to obtain Directors' inputs on
effectiveness of the Board/ Committee processes. Additionally, the evaluation process
compared the evaluation reports of earlier years and reviewed the areas where improvements
have been made and the areas where further improvement is desired.
In a separate meeting of the IDs held on March 29,2023, the performance of the
Non-Independent Directors and the Board as a whole including the Chairman of the Board
were evaluated taking into account the views of Executive Directors and other
Non-Executive Directors. The feed back of the Independent Directors was shared with the
NRC.
The NRC 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 NRC, the performance of the Board, its committees, and individual Directors
were discussed.
Outcome of Evaluation
The evaluation process endorsed the Board Members' confidence in the ethical standards
of the Company, the resilience of the Board and the Management in navigating the Company
during challenging times, cohesiveness amongst the Board Members, constructive
relationship between the Board and the Management and the openness of the Management
in sharing strategic information to enable Board Members to discharge their
responsibilities and fiduciary duties.
In the coming year, the Board intends to enhance focus on Safety and Sustainability.
5. Remuneration Policy for the Board and other Employees
In determining the remuneration of the Directors, Key Managerial Personnel ('KMP') and
other employees of the Company, based on the recommendations of the NRC, the Board has
approved the Remuneration Policy for Directors, Key Managerial Personnel 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 employees.
- It lays down the parameters for remuneration payable to Directors for services
rendered in other capacity.
During the year under review, there has been no change in the Policy. The said Policy
is available on our website at https://
www.tatametaliks.com/static-files/pdf/policies/TML-NRC-policv. pdf
6. 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 ('Rules') are annexed to this Report as (Annexure
D). In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and
5(3) of the Rules, a statement showing the names and other particulars of employees
drawing remuneration in excess of the limits set out in the said Rules forms part of this
Integrated Report and Annual Accounts 2022-23. Further, the report and the annual accounts
are being sent to the Members excluding the aforesaid statement. In terms of Section 136
of the Act,the said statement will be open for inspection upon request by the Members. Any
Member interested in obtaining such particulars may write to the Company Secretary at investors@tatametaliks.co.in.
7. Directors
The year under review saw the following changes to the Board of Directors ('Board').
Induction to the Board
Upon the recommendation of NRC, the Board unanimously considered and approved
appointment of Mr. Alok Krishna as Managing Director of the Company effective November
1,2022. On January 30,2023, the Shareholders of the Company, by way of a special
resolution passed through postal ballot, approved the appointment of Mr. Krishna as
Managing Director of the Company for a period of three years.
Re-appointment of Director retiring by rotation
In terms of the provisions of the Companies Act, 2013 read with Articles of Association
of the Company, Mr. Koushik Chatterjee (DIN: 00004989), Non-Executive Director of the
Company, retires at the ensuing AGM and being eligible, seeks re-appointment. The
necessary resolution for re-appointment of Mr. Chatterjee forms part of the Notice
convening the ensuing AGM scheduled to be held on Wednesday, August 30,2023.
The profile and particulars of experience, attributes and skills that qualify Mr.
Chatterjee for Board membership, are disclosed in the said Notice.
Resignation
Mr. Sandeep Kumar (DIN: 02139274) resigned as Managing Director of the Company
effective the close of business hours of October 31,2022, to take up a similar opportunity
in the Tata Steel Group. The Board of Directors placed on record their deep appreciation
for the contributions and guidance provided by Mr. Kumar during his tenure.
8. Independent Directors' Declaration
The Company has received the necessary declaration from each Independent Director (IDs)
in accordance with Section 149(7) of the Act and Regulations 16(1)(b) and 25(8) of the
SEBI Listing Regulations, that he/she meets the criteria of independence as laid out in
Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations.
In the opinion of the Board, as per the confirmations received from the IDs, there has
been no change in the circumstances which may affect their status as IDs of the Company
and the Board is satisfied of the integrity, expertise, and experience (including
proficiency in terms of Section 150(1) of the Act) of all IDs on the Board. Further, in
terms of Section 150 read with Rule 6 of the Companies (Appointment and Qualification of
Directors) Rules, 2014, as amended, IDs of the Company have included their names in the
data bank of Independent Directors maintained with the Indian Institute of Corporate
Affairs.
9. Key Managerial Personnel
Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company are Mr.
Alok Krishna, Managing Director, Mr. Subhra Sengupta, Chief Financial Officer, and Mr.
Avishek Ghosh, Company Secretary and Compliance Officer as on March 31,2023. During the
year under review, there has been one change in the Key Managerial Personnel. Mr. Sandeep
Kumar (DIN: 02139274) ceased to be the Managing Director of the Company effective the
close of business hours of October 31, 2022. Mr. Alok Krishna (08066195) assumed the role
as Managing Director and Key Managerial Personnel of the Company effective November
01,2022.
10. Audit Committee
The Audit Committee ('Committee') is duly constituted as per the provisions of
the Act and applicable Rules framed there under read with the SEBI Listing Regulations.
The primary objective of the Committee is monitoring and supervising the Management's
financial reporting process to ensure accurate and timely disclosures with highest levels
of transparency, integrity and quality of financial reporting.
The Committee comprises of Mr. Krishnava Dutt (Chairman),
Dr. Pingali Venugopal, Ms. Samita Shah and Mr. Amit Ghosh.
The Committee met 6 (six) times during the year under review. Details of terms of
reference of the Committee, number and dates of meetings held and attendance of Members
during the year are part of the Corporate Governance Report.
During the year under review, there were no instances when the recommendations of the
Audit Committee were not accepted by the Board.
11. Internal Control Systems
The Company's internal control systems commensurate with the nature of its business,
the size, and complexity of its operations and such internal financial controls with
reference to the Financial Statements are adequate. Details on the Internal Financial
Controls of the Company forms part of Management Discussion and Analysis forming part
ofthis Integrated Report and Annual Accounts 2022-23.
12. Risk Management
Risks are integral to any business, and the Company's Risk Management framework over
the years has evolved in line with the strategic objectives and changes in the operating
environment. It helps to predict and undertake pre-emptive response to manage and mitigate
key risks. Amidst various micro and macro uncertainties and volatile business environment,
the Company faces frequent changes in technology, geo-politics, financial markets,
regulations, etc. which affect the value chain at large. To build a sustainable business
that can respond to these changes, the Company has an agile and responsive risk management
framework for identifying, prioritising and mitigating risks which may impact attainment
of short and long-term business goals of the Company.
The Company has deployed an Enterprise Risk Management ('ERM') frameworkto
create long-term value and become a risk intelligent organization that drives informed
decision making to proactively prepare for unforeseen scenarios. The Risk Management
framework,is aligned with the holding Company's Group Risk Management process, is based on
international standards like Committee of Sponsoring Organization of the Treadway
Commission ('COSO') and ISO 31000 and is aligned with strategic planning and
capital project evaluation process of the Company. The process aims to analyse internal
and external environment and manage economic, financial, market, operational, compliance,
sustainability and business continuity risks and capitalises on opportunities for business
success. The development and implementation of Risk Management policy has been covered in
the Management Discussion and Analysis, which forms part ofthis report.
The Company periodically reviews the identified key risk areas which are mapped and
linked with the operational objectives of the Company. These risks are periodically
revisited against their respective mitigation plans. The Board has a separate Risk
Management Committee consisting of Directors and a management representative, responsible
for monitoring and reviewing the risk management plan, ensuring its effectiveness and sets
the context for implementation of the ERM across the organisation. The Audit Committee
also 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 Risk Management Committee meets at periodic intervals
and monitors, evaluates and strengthens the effectiveness of risk management framework of
the Company.
The Company's risk-based culture enabled it to manage the uncertainties in a volatile
and challenging business environment during the year under review. Further, business
decisions were pivoted to achieve cash neutrality in operations by reducing spend,
managing working capital and reducing capital expenditures. Operating regime was
recalibrated in response to the decline in domestic demand. Supply chain disruptions were
managed through robust planning and developing alternate suppliers. In view of sluggish
domestic dispatches, risk to sales was mitigated through enhanced exports and new
international markets were cultivated.
During the year under review, the Company has made significant progress in its journey
towards risk intelligence and the management is working under the active guidance of the
Risk Management Committee and the Board to navigate the volatile economic environment.
13. Vigil Mechanism / Whistle Blower Policy
The Company has a well-defined Vigil Mechanism policy in place that provides a formal
process for all Directors, employees, business associates and vendors of the Company to
approach the Ethics Counsellor/Chairman of the Audit Committee. Due awareness is made
across the organization and business partners to enable anyone 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 accessto the Chairman of the Audit Committee. In addition, Directors, employees,
and vendors, can approach the Ethics Counsellor to make any such protected disclosure.
During the year under review, the Company also undertook a series of communication and
training programmes for various stakeholders.
The Whistle Blower Policy is an extension of the TCoC which requires every
Director/employee/business associate/vendor to promptly report to the Management any
actual or possible violation of the TCoC or any event which he or she becomes aware of,
that could affect the business or reputation of the Company. The said policy is available
on the Company's website at www.tatametaliks.com/static-files/pdf/policies/
whistleblower-policv.pdf. The Vigil Mechanism of the Company includes policies viz.
Whistle Blower Policy, Gifts Policy, the Anti-Bribery & Anti-Corruption ('ABAC') Policy
and Anti Money laundering Policy ('AML') as adopted by the Company and which are
available on the website of the Company at https://www.tatametaliks.com/corporate/policies/.
During the year under review, the Company received 15 (fifteen) whistle blower complaints
which were duly investigated and resolved.
14. Disclosure as per Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013
The Company has zero tolerance towards sexual harassment at the workplace. The Company
has adopted a 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 made there under. All
employees (permanent, contractual, temporary, trainees, etc.) are covered underthis
Policy.
The Company has complied with the provisions relating to the constitution of the
Internal Complaints Committee as per the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013.
During the year under review, the pending complaint of the previous year was duly
closed. The Company received 1 (one) complaint of sexual harassment during the year. As on
the date of this report, the matter has been resolved.
15. Related Party Transactions
In line with the requirements of the Act and the SEBI Listing Regulations, the Company
has formulated a Policy on Related Party Transactions. The Policy can be accessed on the
Company's website at https://www.tatametaliks.com/wp-
content/uploads/2023/02/rpt-policv-1.pdf
During the year under review, all related party transactions entered into by the
Company, were approved by the Audit Committee and were at arm's length and in the ordinary
course of business. Prior omnibus approval is obtained for related party transactions
which are of repetitive nature and entered in the ordinary course of business and on an
arm's length basis. The Company did not have any contracts or arrangements with related
parties in terms of Section 188(1) of the Companies Act, 2013.
Accordingly, the disclosure of related party transactions as required under Section
134(3)(h) of the Act in Form AOC-2 is not applicable to the Company for FY 2022-23 and
hence does not form part of this report.
Details of related party transactions entered into by the Company, in terms of Ind
AS-24 have been disclosed in the notes to the financial statements forming part of this
Integrated Report & Annual Accounts 2022-23.
16. Directors' Responsibility Statement
Based on the framework of IFC established and maintained, the work performed by the
internal, statutory and secretarial auditors and external consultants, including the audit
of internal financial controls over financial reporting by the statutory auditors and the
reviews performed by Management and the relevant Board committees, including the Audit
Committee, the Board is of the opinion that the Company's internal financial controls were
adequate and effective during FY 2022-23.
Accordingly, pursuant to the provisions of Section 134(3)(c) read with Section 134(5)
of the Act, the Board, 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 along with proper explanation relating to material departures;
b) they have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view
of the state of affairs of the Company 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 this Act 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 in the Company and that such
internal financial controls are adequate and were operating effectively; and
f) they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and operating effectively.
17. Subsidiaries, Joint Ventures and Associates
The Company does not have any subsidiary, associate or joint venture Company as on
March 31, 2023. Accordingly, the requisite disclosure as per Section 129(3) of the Act in
Form AOC-1 is not applicable.
18. Auditors Statutory Auditors
Members of the Company at the 27th Annual General Meeting held on July 26,
2017, approved the appointment of Price Waterhouse & Co Chartered Accountants LLP
(Registration No.304026E/ E300009) ('PW'), Chartered Accountants, as the Statutory
Auditors of the Company. Further, the Shareholders approved the re-appointment of PW for a
second term of five years commencing the conclusion of 32nd AGM until the
conclusion of the 37th AGM to be held in the year 2027.
Further, the remuneration to be paid to Statutory Auditors for FY 2023-24 is Rs.41
lakhs plus out of pocket expense and the remuneration for the remaining tenure of their
second term as Statutory Auditors shall be mutually agreed between the Board of Directors
and PW, from time to time.
The report of the Statutory Auditors forms part of this Integrated Report and Annual
Accounts 2022-23.
Secretarial Auditor
Section 204 of the Act, inter-alia, requires every listed Company to annexto its
Board's report, a Secretarial Audit Report, given in the prescribed form, by a Company
Secretary in practice.
Accordingly, in compliance with the provisions of the Act and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board, upon the
recommendation of the Audit Committee, had approved the appointment of Mr. P. V.
Subramanian, Company Secretary in Whole-time- Practice [C.P. No. 2077, ACS 4585], as the
Secretarial Auditor of the Company for the financial year ending March 31, 2023.
The Secretarial Audit Report for the financial year ended March 31,2023, in Form MR-3,
forms an integral part of this report and is annexed herewith as (Annexure E).
Cost Auditors
Pursuant to the provisions of Section 148 of the Act and the Companies (Cost Records
and Audit) Rules, 2014, the Company is required to maintain its cost records and get the
same audited by a Cost Accountant in practice. Accordingly, the cost recordsare made and
maintained bythe Company as required under Section 148(1) of the Act.
The Board has, based on the recommendation of the Audit Committee, approved appointment
of Messrs. Shome & Banerjee, Cost Accountants (Firm Registration No: 000001) as the
Cost Auditors of the Company for the financial year ending March 31, 2024.
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.
Pursuant to Section 148 of the Act, read with Rule 14(a)(ii) of Companies (Audit and
Auditors) Rules, 2014, as amended, the remuneration of Rs.3.50 lakhs plus applicable taxes
and reimbursement of out-of-pocket expenses payable to the Cost Auditors for conducting
cost audit of the Company for FY 2023- 24 as recommended by the Audit Committee and
approved by the Board has to be ratified by the Members of the Company. The same is placed
for ratification of Members and forms part of the Notice of the AGM.
19. Auditors'Qualification
No qualifications, reservations, adverse remarks or disclaimers are provided in the
reports by the Statutory Auditors, Secretarial Auditor and Cost Auditors respectively.
20. Reporting of Fraud
During the year under review, the Statutory Auditors,
Secretarial Auditors and Cost Auditors have not reported any instances of frauds
committed in the Company by its officers or employees to the Audit Committee under Section
143(12) of the Act, details of which need to be mentioned in this Report.
21. Annual Return
The Annual Return for financial year 2022-23 as per provisions of the Act and Rules
thereto, is available on the Company's website at httnsV/www.tatametaliks.com/
22. Significant and Material Orders Passed by the Regulators or Courts
There has been no significant and material order(s), passed by any Regulator(s) or
Court(s) or Tribunal(s), impacting the going concern status of the Company's operations.
However, Members' attention is drawn to the statement on contingent liabilities and
commitments in the notes to the Financial Statements. No material changes and commitments
have occurred after the close of the financial year till the date of this Report which
affects the financial position of the Company for the reporting period.
23. Particulars of Loans, Guarantees or Investments
Particulars of loans, guarantees given and investments made during the year under
review in accordance with Section 186 of the Companies Act, 2013 is annexed to this report
(Annexure F)
24. Energy Conservation, Technology Absorption and Foreign Exchange Earnings &
Outgo
Details of energy conservation, technology absorption and foreign exchange earnings and
outgo are annexed herewith as (Annexure G).
25. Deposits
The Company has not accepted any fixed deposits nor does the Company has any
outstanding deposits under Section 73 of the Act, read with the Companies (Acceptance of
Deposit) Rules, 2014 as on the date of the Balance Sheet.
26. 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.
27. Other Disclosures
(a) There has been no change in the nature of business of the Company as on the date of
this Report.
(b) There were no material changes and commitments affecting the financial position of
the Company between the end of the financial year and the date of this Report.
(c) There was no application made or proceeding pending against the Company under the
Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.
Awards and Accolades
Your Directors are happy to report that the Company was bestowed with several awards
during the year. Noteworthy ones are mentioned below:
- Cll - CAP (Climate Action Program) 2.0 Oriented Category Award for Energy, Mining and
Heavy Manufacturing Sector
- Cll DX Innovative Best Practices Award - Operational Excellence Category
- GreenCo Gold award by Cll - Sohrabji Godrej Green Business Centre
- Cll Digital Trasnformation Award for Robotics
- 4.5 star Rating Received in Cll ENCON Award
- Certified as 'Great Place to Work
- Winner under the listed medium category at the'Corporate Governance Recognition 2022'
organised by Bengal Chamber of Commerce and Industry
G. Acknowledgements
Your Directors take this opportunity to thank its Stakeholders,
i.e. Members, Customers, Vendors, Dealers, Investors,
Business Associates and Bankers, for their continued support during the year. They
place on record their deep sense of appreciation for the contribution made by Senior
Leadership team and employees at all levels across the organisation.
The resilience to meet and successfully overcome several challenges was possible due to
their hard work, solidarity, co-operation and support. Your Directors also express their
gratitude towards Government of India, Government of West Bengal and other States in
India, concerned Government Departments and Agencies and Regulatory Authorities for their
continued support.
|
On Behalf of the Board of Directors |
|
Sd/- |
|
Koushik Chatterjee |
| Place: Mumbai |
Chairman |
| Date: April 28,2023 |
DIN:00004989 |
|