Ar 2005-06

24
th
Annual Report
2005-06
Create a bold path,

Conquer the future
Rashtriya Ispat i!a" #i"ited

Visakhapatnam Steel Plant
(A Govt. of India Undertaking)
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Foundation Stone Laying Ceremony for Expansion of RINL
from 3MT to 6.3MT p.a. of Liquid Steel
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India Steel Summit
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It gives me great pleasure to
welcome you to this very special
24
th
Annual General Meeting of
your company, the first after its
declaration as a Mini Ratna
Company by the Honble
Minister for Steel, Chemicals
and Fertilizers, Government of
India on 20
th
May 2006.
Your company has moved ahead
with a strong performance and
well conceived strategies for
Expansion, Improved capacity
utilization and Corporate
transformation. The sustained performance of the company particularly during the last four years with its
relentless pursuit towards excellence enthuse over all confidence among all the stake holders. I feel proud to
quote the Honble Prime Minister on the momentous occasion of the Foundation stone laying ceremony on
the 20
th
May 2006 for the expansion of the plant from its present capacity of 3 Mt to 6.3 Mt liquid steel.
The turnaround of this steel plant is a land mark achievement. It shows that with hard work and
commitment, PSUs can perform well against competition. RINL has shown other PSUs the way forward. I
congratulate everyone associated with the remarkable turnaround. We rejoice in your success.
2005-06 : The record breaking year :
Our continued excellence and relentless endeavours backed by our sound work culture and dedicated work
force helped in registering the best ever sales turnover of Rs.8482 crs in the year 2005-06, the best since
inception. This is really noteworthy particularly given the steel market scenario in 2005-06 that witnessed
softening of the steel prices and hardening of the raw material inputs.
The Global Scenario :
The global steel scenario has stabilized by the end of 2005-06 and it is expected to grow steadily with
increased demand for steel from China and USA followed by India due to increase in infrastructural and
manufacturing activities. Apart from this, renewed business confidence from Europe and Asia has made
the economic scenario appear quite positive.
A
Indian Scenario :
The Indian economic scenario is robust at present backed by sustained manufacturing activity and focus on
Infrastructure development by the government. The GDP growth was around 8.4% (estimated) in 2005-06
against 7.5% in 2004-05. Growth prospects of the economy and business opportunities exude confidence and
there is over all optimism in all sectors paving way for investments by foreign institutional investors. This will
definitely help in augmenting the infrastructure sector which will enable handsome steel growth.
Indian Steel Sector :
The Indian Steel Sector has shown an accelerated growth rate of over 9% in the last five years and is all
set to grow further backed by strong economic growth. A National Steel Policy under the able stewardship
of the Honble Minister for Steel, Chemicals and Fertilizers has been evolved to facilitate smooth growth
of the steel industry. The long term goal of the National Steel Policy is to develop India as a modern and
efficient steel producer and achieve global competitiveness not only in terms of cost, quality and product
mix but also in terms of efficiency in productivity.
RINL - Bright Years ahead :
RINL, the emerging giant, has evolved both short term and long term strategies in line with the National
Steel Policy to convert the challenges into opportunities and propel the company to become a world class
integrated steel plant. The current expansion to double the capacity by 2008-09 is another step in its vision
to emerge as a world class company. The Corporate Plan 2020 is being worked out to capitalize on the
current opportunities and leverage the inherent strength, which will provide a blue print for growth of your
great company.
Strategic Initiatives :
Raw material security has become the prime concern and various strategies have been drawn to acquire
captive mines both within the country as well as abroad through joint ventures and acquisitions. An
exclusive group is working in this direction and joint ventures with NMDC and MOIL are the results of
such efforts. Our continued efforts for captive mines has resulted in the allocation of Mahal Coking Coal
Block with an estimated reserve of 258 Million Tonnes.
To strengthen our brand leadership in the market and improve process optimization, concerted efforts are
being put to provide more value to the customers at a price that is competitive and attractive. Therefore,
an exclusive R&D Department has been formed to focus on value advantage and cost optimization.
To further enhance the operational efficiencies, Enterprise Resource Planning is given due priority and a
cross functional team has been set up to ensure its implementation at the earliest.
=0
On the energy front, in line with the vision of our Honble President Dr Abdul Kalam ji, renewable energy
and generation of bio-diesel has been given due attention and action plans have been drawn to substitute
5% of the energy requirement through renewable energy. A Renewable Energy Policy has been drawn
committing our efforts towards augmenting Renewable Energy.
Human Resources Development :
Today RINL stands tall among its competitors with an unmatched quality leadership. This is phenomenal,
given the high levels of capacity utilization of about 125%. The Labour Productivity of 282 t/man year is
the best in the steel industry of the country. This would not have been possible but for the committed and
dedicated team of our employees and their passion to excel. Their excellence is best exemplified by your
company winning almost one fifth of the Vishwakarma Rashtriya Puraskars at the National level. The
company therefore puts concerted efforts to sharpen the innovative and creative skills of the employees for
building upon the existing competencies and also for creating new areas of excellence. The HRM practices
are directed to motivate them and ensure their readiness to face the emerging challenges and the upswing
in the companys business.
Corporate Social Responsibility (CSR) :
As a responsible corporate citizen your company has initiated voluntary measures addressing the social
and environmental concerns of the stake holders. A comprehensive CSR Policy has been evolved. CSR is
viewed as a key business process to ensure peripheral development and for promoting the cultural
efflorescence of the society around. A number of welfare and development projects have been taken up and
a lot more have been planned to promote all round development of the society.
Continued Excellence :
The first quarter of the second fiscal has started on a bright note with the sales registering a growth of
30%. The Expansion programme has been given continued fillip and all efforts are being put for
completing the expansion by 2008-09 as promised to the government. A High Power Steering Committee is
formed to monitor the progress periodically. The task is quite daunting and therefore the need for speedy
implementation has been given specific focus through empowerment and refinement of processes and
systems. I am confident with the resources and competencies available, the RINL collective will leave no
stone unturned in accomplishing its objective.
Laurels :
The performance of your company has been well recognized and has been bestowed with a number of
accolades in various spheres of our activities. Some of them are :
1- The National Energy Conservation Award for the sixth time in succession
2- The ICWAI Award for Excellence in Cost Management
3- Commendation Certificate for Strong Commitment in HR Excellence from CII
==
1- The INSAAN Award for Organisational Excellence
2- The QCFI Award for the best QC implementation
3- Golden Peacock Award for Environment Management
4- The CII Award for Excellence in Water Management
5- The Viswakarma Rashtriya Puraskars (6 out of 28 awards at the National Level)
The Future :
With the kick starting of the second phase of RINL, your company has now embarked in chalking out the
growth path for future. As mentioned earlier, the Corporate Plan 2020 is under preparation to leverage the
inherent strengths and create more value to the stake holders. As the steel industry becomes more and
more technology driven, the need for intensifying the R&D activities has become more imperative and due
care is taken to strengthen this area further. The integration of the existing assets with the emerging
technologies and diversification of activities in line with the market needs are the broad areas of focus in
the Corporate Plan to be released shortly.
Acknowledgements :
The journey of RINL as a Mini Ratna Company has just started and with a committed and competent team,
your company is poised to create more wealth and greater value for the shareholders. During the current
fiscal year, as the Company enters into its Silver Jubilee year, I am sure it will take on its stride the
challenges to convert them into profitable avenues to place it on a higher orbit of growth and excellence to
acquire the NAVRATNA status in the coming years.
The sustained excellence of your company could be achieved with the commitment and contribution from
the entire RINL collective and support from various other corners, the Valued Customers, Suppliers, the
Statutory Auditors, C&AG, Financial Institutions, Banks, Officers Association and the Unions. I take this
opportunity to thank the Honble Minister of Steel, Chemicals & Fertilizers, the Honble Minister of State
for Steel, the Secretary and officials of the Ministry of Steel, Government of India for their unstinted
support. I would also like to acknowledge the support extended by the Honble Chief Minister of Andhra
Pradesh and officials of the State Government. I am thankful to the assistance rendered by other
Ministries/ Departments of the Government of India and the Government of Andhra Pradesh. I am grateful
to the entire Board of Directors for their guidance and support. I thank each and every employee of the
Company for their dedicated efforts and hard work in keeping the Companys flag flying high at all times.
( Y Siva Sagar Rao )
Place : Visakhapatnam
Date : 25
th
September, 2006
=2
)IR2C3/R+, R2'/R3
To
The Members,
Rashtriya Ispat Nigam Ltd,
Visakhapatnam.
On behalf of the Board of
Directors of the Company, I
have great pleasure in
presenting the 24th Annual
Report of the Company
together with the Audited
Accounts for the year ended
31st March, 2006.
It is a matter of immense
satisfaction for me and the
entire VSP collective that as
your Company enters the Silver
Jubilee year of its existence, it
has posted a sterling
performance encompassing all
facets of corporate excellence.
For the past twenty four years,
your company has focused on
its core competencies without
any diversions. It has put in all
out efforts for excellence in
almost all fields of its
functioning and in spite of
various adverse factors and
situations over the last twenty
four years, the Company
ultimately emerged as a profit
making company wiping out all
its accumulated losses and
setting industry standards in
many technical parameters
benchmarking with the best in
the world of Steel industry.
2005-06 : AN YEAR OF
SUSTAINED GROWTH
The year 2005-06 has been a
significant one for
the Steel industry in
general with the
world steel
production
registering a 6%
growth. On the
domestic front, the
industry has grown
by over 16%, a
remarkable
achievement
indeed. This only
supports the growth
anticipated in the
National Steel
Policy symbolizing
robust economic
growth. During the
year, RINL on its
part achieved a
capacity utilization
of 120% of its rated
capacity and
registered a 2%
growth in Saleable
Steel production.
The total sales
turnover has
improved by 3.68%.
Majority of the Units
have achieved a
rare distinction of
highest ever
production since
inception. The
turnover touched an
all time high since
inception. The year
shall also be
reckoned as a
landmark and
memorable one for
RINL, because it
could secure the
final approval
/clearance of the
Government of
India in a record time of 10
months for its Expansion
Project from 3Mt to 6.3 Mt of
Liquid Steel i.e. almost
doubling its rated capacities
thus paving way for a
sustainable growth path in
coming years as well.
FINANCIAL REVIEW
The Financial year 2005-06
was an eventful year for RINL.
It has created Record Turnover
of over Rs.8,482 crores. For
the fifth consecutive year it
earned Net Profit and for the
year it is Rs.1,252 crores after
taxes. This is apart from
payment of (a) Income Tax of
Rs.500 crores towards
Corporate Tax, (b) over
Rs.1000 crores towards Excise
Duty and (c) over
24th AGM held at
Vizag on 25th
September, 2006.
=<
Rs.250
crores by
way of
Sales
Tax to
different
State
Governm
ents.
With the
current
year's
net
profit, all
the
accumul
ated
losses of
the
company
since its
inception
have
been
fully
wiped
out. With
this,
RINL
became
a real
profit
making
company
and it
has,
therefore
, been
classified
as a
MINIRAT
NA
CATEGO
RY-I
PSE by
Govt. of
India vide
Ministry of
Steel's
letter
No.1(9)20
04-VSP
dated 25th
May, 2006.
It is indeed
a great
journey
from a
time when
the
company
has
reported to
BIFR its
erosion of
Net Worth
and now
conferred
with
MINIRATN
A status.
The
Company
was
conferred
National
Award for
Excellency
in Cost
Reduction
instituted
by the
Institute of
Cost and
Works
Accountan
ts of India
(ICWAI) for
the year
2005 in
recognition
of its
efforts for
effective
implement
ation of
Cost and
Manageme
nt
Accounting
tools,
quality of
cost
accounting
records,
optimum
utilization
of
resources,
waste
manageme
nt, etc. by
the
Ministry of
Company
Affairs,
Governme
nt of India.
This is one
more
feather in
the cap of
RINL. The
Finance
and
Accounts
Departmen
t of the
Company
secured
the ISO
9001
Certificate,
which is
unique in
Public
Sector
Steel
Plants in
the
Country.
The summary of Financial performance is as
follows:
Rs. In
Crores
Description 2005-06
2004-
05
Turnover (Gross) 8482.44 8181.34
Total Income 7761.59 7646.15
Total expenditure 5392.54 4375.16
Gross margin 2369.04 3270.99
Interest charges 31.24 11.11
Cash Profit 2337.80 3259.88
Depreciation 448.29 447.25
Profit before exceptional
items 1889.51 2812.63
Depreciation of earlier
years - 558.87
Profit before tax 1889.51 2253.76
Provision for tax
Current Tax 474.97 87.18
Fringe benefit Tax 3.94 -
Deferred Tax 158.23 158.49
Net Profit 1252.37 2008.09
Accumulated loss (-) / profit
(+)
(+)
346.38
(-)
905.99
Boar
d
Meeti
ng
held
at
Vizag
on
31st
Augu
st,
2006.
=4
SALE
S
AND
MAR
KETI
NG
REVI
EW
Marke
ting
Perfor
manc
e
durin
g
April
2005 -
March
2006
As
agains
t the
MOU
target
of Rs.
8793
Crs.
for the
year
2005-
06,
VSP
achiev
ed a
sales
realisa
tion of
Rs.
8482
Crs.,
thus
registe
ring a
fulfilm
ent of
96%
and a
growth of
4% over
the sales
turnover
of Rs.
8181
Crs. in
2004-05.
The
Sales
turn over
of
Rs.8482
Crs. of
2005-06
were the
best ever
since
inception
. And this
could be
possible
against
the
backdrop
of
sluggish
market
condition
s right
througho
ut the
year
which
has
brought
price line
under
tremend
ous
pressure
for any
year.
Domesti
c sales
turnover
of Rs.
8040
Crs. in
2005-06
was also
the best
ever till
date.
Sales
performa
nce w.r.t.
MOU
Target
2005-
06 :
Volume in '000 t
ITEM
2005-
Target Actual
Domestic
Pig Iron 383
Steel 3078
Export
Pig Iron 33
Steel 47
Total
Pig Iron
41
6
Steel
31
25
Value in
Rs.Crs.
Domestic
*
864
3 8039.9
Export 150
Total
87
93
* Domestic
includes
Iron, Steel
& By
Products
The
reven
ue
gener
ation
increa
sed
with
higher
sales
realiza
tion
value
as
well
as the
increa
sed
sale of
value
added
produ
cts.
Sale
of
value
added
produ
cts
grew
by 5
% in
2005-
06 as
compa
red to
2004-
05.
Total
sales
in
Steel
volum
e
during
2005-
06
registe
red
record
sales of
3.3
million
tons
(since
inception
) with a
6%
growth
over
previous
year.
Domesti
c steel
volume
of 3.10
million
tons
recordin
g a
growth of
1% over
2004-05
(3.06
million
tons).
To
further
strength
en the
Exports,
2.02 lakh
tonnes of
steel
was
exported
during
the year
to the
countries
viz.
Banglad
esh,
Myanmar
, Nepal,
Sri
Lanka,
Thailand
and USA
being
our
strategic
markets,
compare
d to 0.56
lakh tons
last year.
Sales of
By-
Products
during
the year
was Rs
150 Crs.
registerin
g a
growth of
5% over
2004-05
(Rs.142
Crs.).
This
includes
exports
of 6.95
lakh tons
of Blast
furnace
slag to
Banglad
esh,
Malaysia
and
USA.
Pig iron
recorded
sales of
3.07 lakh
tons in
Domesti
c market
during
2005-06
with a
growth of
156%
over
2004-
05
(1.20
lakh
tons).
The
focus
during
the
year
was
on the
develo
pment
of
actual
user
base
in
domes
tic
marke
t.
Aroun
d 60%
of the
steel
was
suppli
ed to
the
actual
user
segme
nt in
2005-
06.
As a
step
toward
s
increa
sing
custo
mer
satisfa
ction
levels,
settleme
nt of
customer
quality
complain
ts
through
e-system
has been
develope
d and
impleme
nted on
VSP's
intranet.
This will
eliminate
Wire Rod Coils in process
=5
delay in processing of quality complaints and provide
an efficient mechanism for settlement of quality
complaints.
SALES TURNOVER DURING THE LAST 3
YEARS:
MATERIALS MANAGEMENT REVIEW
During the year 2005-06, the required materials were
made available in time with no disruption of
Production.
Long Term Agreements were entered into for Hard
Coking Coal, Soft Coking Coal, Coke, Iron Ore Lumps
and Fines and MOUs were signed for MCC, Boiler
Coal, Aluminium Coils & Ingots and Steel Items, in
order to curtail price fluctuations in a highly volatile
market and to control the scarcity of material.
Coking Coal block at Mahal, Dhanbad (Dist), Jaria Coal
Field has been allotted to RINL and further studies are
underway. A High Level Delegation visited Canada,
Columbia, USA & Australia to explore the possibility of
acquiring Coking Coal Mines and submitted it's report.
MOU was entered with NMDC for a Joint Venture for Iron
Ore Pellet/Sponge Iron Plant in Chattisgarh.
3 Year Contracts were entered into for Special
Refractory Items. Also Rate Contracts were entered/
continued for various spares and consumables.
Coke Oven Battery Coke Ovens - By Product Plant
=6
5S
was
imple
mente
d in
almost
all
areas
of
Stores
for
better
house
keepin
g and
servic
e. A
20 T
Gantry
crane,
lying
idle for
almost
two
decad
es,
was
made
operat
ive
throug
h in-
house
efforts.
The
invent
ory of
Stores
and
Spare
s at
cost
as on
31.03.
2006
was
Rs.
294.72
crores
(provisio
nal) and
was Rs.
290.83
crores as
on
31.3.200
5. While
adding
In-
transit/un
der
inspectio
n items
and
reducing
obsolesc
ence and
non-
moving
items,
the level
of
Inventory
was
brought
down
from
Rs.279.2
6 crores
in 2004-
05 to
Rs.273.5
4 crores
in 2005-
06.
During
the
period
under
consider
ation,
project
inventory
of Coke
Oven
Battery
IV has
gone up
from
Rs.16.12
crores to
Rs.32.81
crores
The
Internal
procure
ment
Leadtime
stood at
84 days
and the
Total
Leadtime
at 206
days.
Initiative
s like Six
Sigma,
simplifica
tion of
Purchas
e
Procedur
es, Total
Logistics
Manage
ment
etc.,
were
taken to
reduce
the
Procure
ment
Leadtime
.
The total
earnings
during
the year
2005-06
stood
at
Rs.102
58.57
lakhs
with
earnin
gs
from
Dispos
al - Rs.
947.76
lakhs;
Cenvat
- Rs.
8217.4
6
lakhs;
Early
despat
ch of
vessel
s-
Rs.108
2.83
lakhs;
Charte
r
agenc
y - Rs.
65.74
lakhs;
Custo
ms
agenc
y-
Rs.6.8
2
lakhs.
Saving
s
throug
h
negoti
ations
was
Rs.
8.51
Crores
.
In order
to
improve
the
existing
online
MIS
system
and to
make it
more
effective,
a
Committ
ee was
formed
on Data
Ware
Housing.
The
recomm
endation
s of the
Committ
ee were
approve
d and
modules
are
being
tested.
MIS
System
for port
operatio
ns and
Major
Raw
material
order
placeme
nt were
made
online.
P
R
O
D
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C
T
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O
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I
E
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H
N
O

E
C
O
N
O
M
I
C

F
A
C
T
O
R
S
Rated
capaci
ty of
the
Plant
has
been
surpas
sed
for the
fifth
conse
cutive
year.
VSP
contin
ued to
honou
r the
commi
tments
made
in the
MOU
for the
year
05-06
entere
d into
with the
Governm
ent of
India in
almost
all shops
by
registerin
g more
than
100%
fulfillmen
t in Oven
Pushing
(104%),
Bars Mill
products
(108%),
Wire
Rods
(113%),
MMSM
products
(116%),
Billets
(103%),
Saleable
Steel
(104%),
Liquid
Steel
(103%),
Hotmetal
(104%)
and
Sinter
(104%).
Highlight
s on
Producti
on front
are
briefly
stated
below:
1 Prod
uctio
n of
2.97
3 Mt
Finis
hed
Steel
with
3%
growt
h
over
last
year.
2 Valu
e
adde
d
prod
uctio
n of
8,89,
112 t
is the
highe
st
with
1%
growt
h
over
04-
05.
3 High
est
no.
of
Iron
and
Steel
rakes
(859
rakes
in a
year,
102
rakes
in a
mont
h)
dispa
tched
sin
ce
inc
ep
tio
n.
4 Hi
gh
est
no
.
of
Ro
ad
ve
hic
les
dis
pa
tch
ed
in
a
m
on
th
(1
07
76
in
M
ar
ch
06
)
5 La
bo
ur
pr
od
uct
ivit
y
of
28
2
t/
m
an
-yr
[6%
growt
h
over
last
year
(265t
/man
-yr)]
is the
best
so
far.
Co
nv
ert
er
Co
nti
nu
ous
Cas
tin
g
=>
1 Gros
s
Wate
r
cons
umpt
ion
of
2.56
cum/
t LS
(8%
redu
ction
over
last
year)
is the
best
so
far.
2 Gros
s
Pow
er
cons
umpt
ion
of
457
Kwh/
t LS
is the
lowe
st so
far.
3 Lowe
st
Semi
s of
8.13
% in
Sale
able
Steel
so
far.
4 Highes
t BF
Produ
ctivity
(w.r.t.
Workin
g
Volum
e) 2.07
t/day
COST
REDUCTI
ON
MEASUR
ES
1) Maximi
zing
the
utilizati
on of
waste
produc
ts like:
1) LD
Sla
g
us
ed
in
SP,
BF
an
d
SM
S
to
rep
lac
e
lim
est
on
e
to
the
ext
ent
of
78,
52
3 t.
2) Scr
ap
to
the
ext
ent
of
6,7
69t
wa
s
rec
lai
me
d
fro
m
ma
int
en
an
ce
act
iviti
es
an
d
us
ed
in
SM
S.
2) Separa
te
Calcini
ng of
lime
and
dolomit
e and
using
the flux
separa
tely in
the
conv
erter
s has
redu
ced
the
cons
umpt
ion
of
flux
per
tonn
e of
Liqui
d
Steel
drast
ically
from
52.7
kg to
45
kg.
In
addition
to the
techno-
economi
c
paramet
ers being
focused
and
monitore
d by
Works
Division,
the other
functiona
l areas
like
Finance,
Materials
Manage
ment
and
Marketin
g have
also
adopted
various
measures
in order to
achieve
cost
reduction
in freight,
transportat
ion and
handling
charges in
respect of
both
inward and
outward
movement
of
materials
including
export as
well as
reduction
in interest
expenses.
RAW
MATERIA
LS /
CAPTIVE
MINES
The
performan
ce of
Jaggayyap
eta
Limestone
Mine for
the year
2005-06
was
excellent
with all
time
production
record of
4,10,325
tonnes and
dispatch
record of
4,03,611
tonnes of
limestone.
The %
growth in
respect of
JLM
production
was 7.74%
and
dispatch
was
12.31% as
compared
to 2004-
05.
The
performan
ce of
Madharam
Dolomite
Mine for
the year
2005-06
was also
excellent
with all
time
productio
n record
of
6,80,293
tonnes
and
dispatch
record of
6,48,185
tonnes of
dolomite.
The %
growth in
respect
of MDM
productio
n was
9.65%
and
dispatch
was
6.65%
as
compare
d to
2004-05.
The
productio
n of
mangan
ese at
Garbha
m
Mangan
ese Mine
was
13,467
tons and
dispatch
was
12,989
tons.
Producti
on
achieved
was
70.14% of
the
budget.
The usage
of sand
was
reduced
and
achieved
46.00% of
sand from
Nellimarla
Sand Mine
and
Sarepalli
Sand
Mine,
which was
opened on
16.12.200
4.
The
Karajada
Sand Mine
at
Vamshadh
ara river in
Srikakulam
district will
be
operated
during
2006-07. It
is
proposed
to operate
a Quartz
Mine
during this
financial
year 2006-
07 at
Kintada
Village, K
Kotapadu
Mandal,
Visakhapat
nam
district to
maintain
uniformity
in quality
of quartz
and
reduce
usage of
sand.
The
Company
has
submitted
5 mining
lease
applications for iron ore deposit in the State
of
Oriss
a
(4415.8807
ha.), two applications in the
state
of
Blast
Furna
ce
=?
Chhatt
isgarh
(4606.
34
ha.)
and
two
applic
ations
in the
State
of
Andhr
a
Prade
sh
(1384.
27
ha).
These
applic
ations
are
pendin
g with
respec
tive
State
Gover
nment
s and
the
same
is
being
follow
ed up
with
Ministr
y of
Mines
throug
h
Ministr
y of
Steel.
ACQUI
SITION
OF
COAL
MINES
IN
INDIA
AND
ABROA
D
Governm
ent of
India
allotted
"Mahal
Block"
(Medium
Coking
Coal) to
RINL/VS
P. Work
Order is
issued
for "Pre-
Feasibilit
y Study"
to
Central
Mining
Plan and
Design
Institute
Ltd
(CMPDIL
),
Ranchi.
RINL/VS
P applied
for
Tenughat
Jhirkhi
Coking
Coal
Block to
the
Ministry
of Coal
and also
applied
for three
Non-
coking
coal
blocks in
Khamma
m
District
to the
Ministry
of Coal.
Ministry
of Coal
forwarde
d it to the
Ministry
of Steel
for their
comment
s.
"Express
ion of
interest
for
acquisiti
on of
Hard
Coking
Coal
Mines
abroad"
was
placed in
VSP's
website.
Respons
es from
Australia
, USA
and
Canada
have
been
received
and the
Evaluatio
n
Proce
ss is
contin
uing
for
selecti
ng
suitabl
e mine
for
Joint
Ventur
e.
Consu
ltant is
propo
sed to
be
appoin
ted by
the
Comp
any
for
further
evalua
tion of
the
propo
sals.
SMS
LIMEST
ONE
JOINT
VENTU
RES
RINL
received
proposal
s and
samples
from
different
agencies
of Oman,
Malaysia
,
Thailand
and
Philippin
es. So
far no
agency
is
finalized
for Joint
Venture
with
RINL/VS
P due to
non-
matching
of
required
specifica
tion. The
processi
ng is
continuin
g for
selecting
suitable
Mine for
Joint
Venture.
SAFET
Y,
ENVIR
ONMEN
T &
HEALT
H
CARE :
Safety
Visakhap
atnam
Steel
Plant is
the first
integrate
d steel
plant to
be
certified
for
"Occupat
ional
Health &
Safety
Manage
ment
System"
as per
British
Standard
s
Institute
specifica
tion in
the year
2002
and re-
certified
again in
the year
2005.
Two
Surveilla
nce
Audits
were
conducte
d in the
year
2005-06.
Continuo
us efforts
in
imple
menta
tion of
safety
standa
rds,
monito
ring of
hazar
ds in
the
activiti
es had
helped
in
achiev
ing a
10.67
%
reducti
on of
report
able
accide
nts.
HIGH
LIGH
TS
AND
ACHI
EVE
MEN
TS :
1 "Z
er
o
Ac
cid
en
t"
wa
s
ac
hie
ve
d
in
17
de
part
ment
s viz.
ACV
S,
CED,
CSD,
Cant
eens,
EnM
D,
ETL,
L&H,
OHS
RC,
PPM,
PEM,
PD,
RMD
,
StED
,
Syst
ems,
TEL
ECO
M,
TS,
and
T&D
C.
RI
NL
sig
ns
M
OU
wit
h
M
OI
L
Saf
ety
at
wo
rkp
lac
e
=A
1 10.6
7%
redu
ction
of
Rep
ortab
le
accid
ents
was
achi
eved
durin
g the
year
2005
-06.
2 First
and
Seco
nd
Surv
eillan
ce
Audit
s of
OHS
AS-
1800
1
were
succ
essfu
lly
com
plete
d
and
well
appr
eciat
ed
by
the
exter
nal
auditor
s.
3 Interna
l
Safety
Audits
were
conduc
ted in
respec
t of 16
depart
ments.
4 Two
plant
level
Mock
Drills
were
conduc
ted to
check
the
emerg
ency
prepar
edness
and
respon
se of
various
agenci
es.
5 Nation
al
Safety
Day
was
celebr
ated
on 4th
March,
2006
and in
that
connec
tion
various
compe
titions
such
as
Quiz,
Essay,
Debate
,
Poster
etc.
were
conduc
ted.
Safety
Playlet
and
First
Aid
Compe
titions
were
also
held.
6 Inter-
depart
mental
Safety
Perfor
mance
and
House
Keepin
g
Comp
etition
s were
condu
cted.
VSP won
the
Leadershi
p and
Excellence
Award for
the efforts
in Safety,
Health
and
Environ
ment in
the
competiti
on
organize
d by CII,
Southern
Region.
OTHER
IMPOR
TANT
ACTIVI
TIES
1 VSP
impa
rted
refre
sher
Safet
y
Train
ing
to
abou
t
5000
regul
ar
empl
oyee
s
and
Safet
y
Indu
ction
traini
ng
and
Job
Spec
ific
Train
ing
was
given
to all
contra
ctor
employ
ees.
2 Control
Measur
es for
Hazard
Identifi
cation
and
Risk
Assess
ment
were
implem
ented
and
monitor
ed.
Measu
rable
targets
were
set in
respec
t of
Safety
and
Occup
ational
Health
for
each
depart
ment
and
corres
pondin
g
manag
ement
progra
ms
had
been
prepar
ed and
monito
red for
achievi
ng the
objecti
ves.
1 On site
emerg
ency
plan
and
Safety
Report
were
update
d.
2 One
trainin
g
Progr
am
was
orga
nized
for
the
Centr
al
Safet
y
Com
mitte
e
mem
bers,
inclu
ding
a
plant
visit
to
NTP
C
Simh
adri.
Depa
rtme
ntal
Safet
y
Com
mitte
e
meeti
ngs
were
held
in
every
mont
h in
vario
us
depa
rtme
nts.
ENVIR
ONMEN
T
MANAGE
MENT
REVIEW
The
commitme
nt of VSP
managem
ent for
preservatio
n of the
environme
nt as an
integral
part of its
products
and
services
has always
remained
a guiding
principle of
its
business
strategy.
Being an
ISO-14001
certified
company
since May
2001, VSP
has
expressly
included
social and
environme
ntal
responsibil
ity in its
corporate
objective
which is
regularly
reviewed
and
improved.
MAJOR
ENVIRO
NMENTA
L
PROJEC
TS
UNDER
IMPLEM
ENTATIO
N
All
statutory
requiremen
ts are
fulfilled and
over a
dozen
projects to
improve
the
environme
ntal
standards
further in
VSP are
under
implementa
tion at an
estimated
cost of over
Rs.263
Crores.
This is an
enough
evidence
on the part
of VSP that
it giving
priority to
people
before
Wor
ksho
p for
Chil
dren
on
Edu
catio
n
Park
in
Tow
nshi
p
20
profits
. The
major
projec
ts
under
imple
menta
tion
includ
e the
followi
ng :
VSP
CERT
IFIED
TO
ISO
1400
1 :
2004
VSP
was
first
certifi
ed to
ISO
14001
: 1996
in
May
2001
and
recerti
fied
on
15.12.
2004.
Howe
ver,
the
stand
ard
was
upgra
ded to
ISO
14001 :
2004
and VSP
took
rapid
strides to
comply
with the
new
standard
. VSP
was
audited
for its
EMS
from 6th
to 8th
February
2006
and
having
complied
with all
the new
requirem
ents,
VSP has
been
certified
by M/s
BVQI for
certificati
on to
ISO
14001 :
2004.
S
l
. Projects under
N
o
. implementation
1 Pulverised coal dust
injection in BF - 1 , 2
2
High temperature
membrane
bag filters in CRMP :
FK - 1, 2, 3, 4
3 Replace compressors
working on 'ODS' with
non-ODS
(R - 22 / R - 134a) :
a) 2 chillers of CWP -
4
b) 4 chillers of CWP-3
4
Dry fly ash handling,
storage
and delivery system
5
a) Continuous on-line
stack
monitoring systems
(10 nos.)
b) Continuous on-line
stack
monitoring stations
(10 nos.)
HEAL
TH
CAR
E
Comp
uteriza
tion of
Visakh
a
Steel
Gener
al
Hospit
al
servic
es
was
compl
eted
succe
ssfully
and
broug
ht into
usage
for all
Out-
Patien
t
activiti
es
startin
g from
Regist
ration,
Consu
ltation,
Clinica
l
Labor
atory,
Radiol
ogical
Investi
gation
s,
Retrie
val of
Investiga
tion
Reports
and
Dispensi
ng of
Drugs
from the
Dispensa
ry
through
Online
(Comput
erized
Operatio
nal
Activities
) from
21st
January,
2006.
The
Second
Phase of
Compute
rization is
under
process
and
efforts
have
been
initiated
for
obtaining
ISO
Certificati
on for
VSGH.
Impleme
ntation of
"5-S"
initially in
Medical
Stores,
Admn.
Office,
Operatio
n
Theatre
was
taken up
and
presently
they are
in "2-S"
& "3-S"
stage.
The total
no. of in-
Patients
treated
was
4,407
and total
no. of
out-
Patients
treated
was
4,72,436.
While
extendin
g
medical
care
round the
clock in
VSGH, to
have
expert
opinion
and
second
opinion
in certain
cases,
and
where
specialist
s do no
exist in
particular
discipline
s, visiting
consulta
nts
are
visitin
g
VSGH
from
Visakh
apatn
am
City
and
extend
ing
their
servic
es on
weekl
y
basis.
A
w
a
r
e
n
e
s
s
P
r
o
g
r
a
m
me
on
He
alth
Car
e
2=
With the
help of
social
service
associati
ons like
Lions
Club,
Rotary
Club,
free eye
camps
are
being
conducte
d in the
VSP's
peripher
al areas
and also
Steel
Doctors
Trust is
being
conducti
ng
general
cases.
In
addition
to all the
above
services,
to create
enthusia
sm and
awarene
ss
among
the VSP
employe
es and
other
Public in
and
around
Ukkunagar
am,
number of
other
programm
es like :
1 Condu
cting
statuto
ry
Health
checku
p to all
Emplo
yees
at
OHSR
C
2 Organi
zing
First
Aid
Trainin
g to
Execut
ives
and
Non-
executi
ves(92
87
emplo
yees
covere
d) at
OHSR
C
3 Apart
from
Patient
Care,
condu
cting
CMEs
-
Interna
l and
Extern
al for
updati
ng the
knowle
dge of
doctor
s
4 Weekl
y once
conduc
ting
the
De-
addicti
on
clinic
in
VSGH
Patients
awareness
programm
es were
also
conducted
periodicall
y.
An amount
of Rs.22
Lakhs was
realized by
the
treatment
of Non-
Entitled
Cases at
VSGH.
HUMAN
RESOUR
CE
MANAGE
MENT
REVIEW
The
Company
has long
drawn
plans
aimed at
individua
l and
overall
develop
ment of
its
Human
Resourc
es.
Towards
achievin
g
synergy
and
group
concept,
the HRD
focused
on many
skilled
training
program
mes for
enhance
ment of
manager
ial
compete
ncies.
THROU
GH
HRD
CENTR
E :
TRAININ
G
PROGR
AMMES
MOU
FULFIL
MENT
2005-
06
SNo Particulars Total
1.0 No. of Programmes
1.1.
1 Inhouse Programmes 106
1.1.
2 External Nominations 354
Grand Total 460
2.0 No. of Employees
2.1.
0 Executives
2.1.
2.1.
Sub-Total 3665
2.2.
0 Non-Executives
2.2.
2.2.
Sub-Total 998
Grand Total 4663
Employees
were
nominated
to
participate
in
programme
s at XLRI,
Jamshedp
ur; ASCI,
Hyderabad
; NITIE,
Mumbai;
IIM
Bangalore;
CII-Godrej
Insitute;
ESCI,
Hyderabad
etc.
Besides
these, a
unique
program
me titled
"Improvin
g
Effective
ness of
Stockyar
d
Sri KA Naidu,
Dire
ctor
(Pers
onne
l)
recei
ving
HR
Exce
llenc
e
Awar
d
22
Opera
tions"
is
organi
zed
for
perso
nnel
under
directo
rate of
Comm
ercial
who
are
conne
cted
with
stocky
ard
operat
ions.
An
expert
faculty
Shri J
Charlu
from
Banga
lore
who
served
as ED
(Mktg)
at
SAIL
and
JVSL
in the
past,
facilita
ted
the
tailor-
made
progra
mmes
during
October
'05 at
Chennai
and
Decemb
er '05 at
Mumbai.
The
program
me
design
includes
visit to
stockyar
d with
senior
manage
ment
member
s and
drawing
up
individua
l action
plans.
The
feedback
was
quite
encoura
ging.
ORGAN
ISATIO
N
DEVEL
OPMEN
T
EMPLO
YEES
SATISF
ACTIO
N
SURVE
Y
Followin
g the
documen
ted
approac
h of
taking
external
consulta
nt's help
to
conduct
a survey
after
every
two
years,
work
order
has been
placed
on M/s
AcNielse
n
ORGMA
RG, New
Delhi,
after
assessin
g the
capabiliti
es of
leading
agencies
in the
country.
The
results of
survey
analysis
pertainin
g to
critical
paramet
ers like
work
content,
hygiene
factors,
welfare,
motiva
tion,
leader
ship
etc.,
are
expect
ed to
come
by
close
of the
secon
d
quarte
r 06-
07.
Organi
sation
climat
e
survey
was
condu
cted in
the
Plant
intern
ally
and
analys
is was
made
for
submit
ting
the
same
for HR
excell
ence
award.
INTE
RNAL
COM
MUNI
CATI
ON
Launche
d novel
informal
monthly
interactio
n
sessions
of our
employe
es with
our CMD
starting
with
maiden
sessions
of "Dil Ki
Baat" for
senior
officers
and
"Chairma
n Tho
Mata" for
non-
executiv
es.
There
was
encoura
ging
feedback
.
IMPLE
MENTA
TION
OF SIX
SIGMA
As an
ongoing
process
towards
business
excellen
ce, Six
Sigma
concept
was
introduce
d in VSP.
During
February
2005,
M/s
Omnex
Consulta
nts,
Chennai
have
been
entruste
d with
the job of
impleme
nting Six
Sigma
concept
to
improv
e the
perfor
mance
.
Specifi
c
project
s on
Quality
,
perfor
mance
, cost-
reducti
on,
waste
elimin
ation
would
be
taken
up by
the
teams
under
the
superv
ision
of M/s
Omne
x
Consu
ltants
for
breakt
hroug
h
improv
ement
in the
above
areas.
An
appre
ciation
progra
mme
was
held in
March
05 for
Top/
Senior
manage
ment
team by
the
consulta
nts. 65
projects
have
been
identified
in Works
and Non-
works
areas
involving
a
potential
savings
of Rs.42
crores to
the
Compan
y. The
projects
are
being
continuo
usly
monitore
d by the
Champio
ns. It is
expected
that this
initiative
will move
from its
present
nascent
stage to
cover
many
more
aspects
of the
processe
s once
training
and
compete
ncies are
built up.
T
H
R
O
U
G
H
T
R
AI
NI
N
G
&
D
E
V
E
L
O
P
M
E
N
T
C
E
N
T
R
E:
EMPLO
YEES
DEVEL
OPMEN
T
PROGR
AMMES
:
1.
Tr
ain
ing
pr
og
ra
m
m
es
co
nd
uct
ed
co
ve
rin
g
a
tot
al
nu
m
be
r
of
44
,4
88
e
m
plo
ye
es,
wh
ich
inc
lud
es
e
m
plo
ye
es
co
ve
re
d
by
T&D
C
(29,8
92
num
bers)
,
HRD,
Safet
y
Dept.
and
CISF
Fire
Wing
thus
La
un
chi
ng
of
R
IN
AD
S
In
au
gu
rat
ion
of
Jas
hu
va
par
k
at
To
wn
shi
p
by
CMD-RINL
2<
Rashtriya Ispat i!a"
#td*
ach
ievi
ng
11.
46
ma
n
day
s of
trai
nin
g
per
em
plo
yee
per
yea
r.
2. Thr
ust
is
giv
en
to
dep
art
me
ntal
refr
esh
er
pro
gra
mm
es
cov
erin
g
ove
r
10,
000
em
ploy
ees
whic
h is
100
%
grow
th
over
last
year.
On
the
Job
Trai
ning
cove
red
700
3
empl
oyee
s. 24
SOP
s
and
192
SMP
s
were
tran
slate
d
into
Telu
gu.
3. A
Com
pete
ncy
Map
ping
Mod
el
has
bee
n
deve
lope
d
and
exec
uted
in
Sint
er
Plan
t
cove
ring
Char
gem
an
to E-
4
level
.
4. With
rega
rd to
quali
ty of
traini
ng,
in
reac
tion
level
feed
back
87.1
2%
parti
cipa
nts
rate
d>4
on a
5-
point
scal
e, in
lear
ning
lev
el
84
%
part
icip
ant
s
sco
red
>60
%
mar
ks
in
pos
t
trai
nin
g
test
s,
in
app
lica
tion
lev
el
fee
d
bac
k,
con
troll
ing
offi
cer
s
rate
d
>3.
5
for
81
%
part
icip
ant
s
on a
5-
point
scal
e.
5. 365
empl
oyee
s
were
train
ed
on
Criti
cal
Equi
pme
nt
Trai
ning
and
200
empl
oyee
s
were
train
ed
on
Criti
cal
Activ
ities
traini
ng
(to
take
care
of
the
critic
al
cont
ract
ual
jobs)
.
6. Trad
e
Test
s
were
cond
ucte
d for
168
9
empl
oyee
s for
the
Inter
Clus
ter
pro
moti
ons
in
differ
ent
Wor
ks
and
Non-
work
s
Dep
artm
ents.
7. Trai
ning
Wee
k
was
cele
brat
ed
from
20-
3-
200
6 to
25-
3-
200
6
and
priz
es
wer
e
dist
ribu
ted
duri
ng
the
val
edi
ctor
y
ses
sio
n.
8. "Ukk
u
Pari
chay
am",
a
book
on
Stee
l
maki
ng in
Telu
gu
has
been
revie
wed,
edite
d
and
print
ed
and
was
relea
sed
durin
g the
Trai
ning
Wee
k
Vale
dicto
ry
Func
tion.
9. The
Trai
ning
Port
al
was
inau
gura
ted
durin
g the
Trai
ning
Wee
k
Vale
dicto
ry
Sess
ion.
10. Refu
rbish
ing
of
T&D
C
audit
oriu
m
and
Conf
eren
ce
Hall
has
been
done
.
New
clas
s
roo
m
furnit
ure
proc
ured
.
Thre
e
clas
s
roo
ms
were
air
cond
ition
ed.
4
LC
D
proj
ect
ors
pro
cur
ed
and
fixe
d in
the
clas
s
roo
ms.
The
am
bie
nce
of
Trai
nee
s
Hos
tel
and
T&
DC
can
tee
n
wer
e
imp
rov
ed.
11. Aud
itori
um
facil
ities
and
nec
ess
ary
hel
p
exte
nded
in
orga
nizin
g
and
cond
uctin
g 35
prog
ram
mes
inclu
ding
VRU
DDH
I
sum
mit,
IRE
FCO
N-
2006
,
WIP
S
funct
ions
etc.
12. 186
QC
Proj
ects
have
been
sub
mitte
d to
MS
Dep
artm
ent
agai
nst a
targ
et of
18
QCs
durin
g the
year.
13. 208
sugg
estio
ns
gene
rate
d in
T&D
C
agai
nst
the
targ
et of
130
durin
g the
year.
OTHER
INITIAT
IVES :
1) FRE
SHE
RS
TRA
ININ
G:
141
M.T(
T)s,
10
M.Ts
(Fin)
and
2 Jr.
Trai
nees
were
give
n
Indu
ction
Trai
ning
and
pos
ted
for
on
the
job
trai
nin
g.
Fou
nda
tion
Sto
ne
Lay
ing
for
Exp
ansi
on
by
Ho
nbl
e
Pri
me
Min
iste
r of
Indi
a
24
2) C
O
M
P
R
E
H
E
N
SI
V
E
M
A
N
A
G
E
RI
AL
C
O
U
R
S
E
F
O
R
JO
s
an
d
JS
Os
:
34
,
19
8
an
d
19
2
ca
nd
idate
s
have
atten
ded
Phas
e-I,
Phas
e-II &
Phas
e-III
progr
amm
es
resp
ectiv
ely
(alto
geth
er
424
inclu
ding
outst
ation
candi
date
s).
3) APP
REN
TICE
SHIP
TRAI
NIN
G:
For
the
first
time,
VSP
host
ed
the
Cent
ralise
d
walk-
in-
inter
view
s for
selec
tion
of
vario
us
appr
entic
es
from
differ
ent
orga
nizati
ons
in
liaiso
n
with
the
appr
entic
eship
auth
oritie
s.
77
Trad
e
Appr
entic
es,
153
Grad
uate
Appr
entic
es
and
138
Tech
nicia
n
Appr
entic
es
,
87
Te
ch
nic
ia
n
(V
oc
ati
on
al)
Ap
pr
en
tic
es
we
re
giv
en
tra
ini
ng
.
4) VA
CA
TI
O
N
AL
T
R
AI
NI
N
G,
C
O
LL
A
B
O
RA
TI
V
E
T
RAIN
ING
AND
GUI
DED
VISI
TS
TO
THE
PLA
NT:
As
part
of
socia
l
oblig
ation
,
VSP
has
been
exte
ndin
g
traini
ng/pr
oject
work
facilit
ies to
stud
ents
of
educ
ation
al
instit
ution
s.
3021
stud
ents
were
given
traini
ng.
5) TRAI
NIN
G
FOR
OTH
ER
ORG
ANIS
ATIO
NS:
24
office
rs
from
JSW
L,
Bella
ry
and
07
office
rs
from
JSPL
,
Raig
arh
were
given
traini
ng in
Sinte
r
Plant
and
Blast
Furn
ace
resp
ectiv
ely.
6) FOR
EIGN
TRAI
NIN
G: 25
office
rs, 8
non-
exec
utive
s
an
d
01
fro
m
M
O
S
we
re
se
nt
on
Fo
rei
gn
tra
ini
ng
/
bu
sin
es
s
vis
its
to
diff
er
en
t
co
un
tri
es
.
7) LIBR
ARY:
919
book
s,
3113
journ
als,
16 e-
journ
als,
126
India
n
and
Inter
natio
nal
Stan
dard
s
were
proc
ured.
227
Man
age
ment
and
Tech
nical
Articl
es, 3
Nos.
of
Libra
ry
bullet
ins
were
circul
ated
to
senio
r
exec
utive
s and
Direc
tors.
Centr
alize
d Air
Cond
ition
with
false
ceilin
g has
been
done
.
8) RE
VE
NU
E
GE
NE
RA
TIO
N :
a) Training charges received
from (JSWL, JSPL etc.)
b) Amount received for
utilization of facilities at
T&DC and Hostel and
Vacational Training
Total
PERSO
NNEL
DEPAR
TMENT
1. MAN
POW
ER :
Durin
g the
perio
d
from
01-
04-
2005
to
31
-
03
-
20
06
th
er
e
wa
s a
ne
t
de
cr
ea
se
in
th
e
m
an
po
we
r
by
39
i.e.
fro
m
16
,6
13
as
on
01
-
04
-
20
05
to
16
,5
74
as
on
31
-
03-
2006
.
As
on
31-
03-
2006
, the
num
ber
of
Displ
aced
Pers
ons
on
the
rolls
of
VSP
was
5,57
1.
E
mp
loy
ee
dev
elo
pm
ent
pro
gra
m
me
in
pro
gre
ss..
Co
rpo
rat
e
So
cia
l
Re
spo
nsi
bili
ty
2. R
E
P
R
E
S
E
N
T
A
T
I
O
N
O
F
S
C
H
E
D
U
L
E
D
C
A
S
T
E
S
A
N
D
S
C
H
E
D
U
L
E
D
T
R
IB
ES
:
I. The
group-
wise
repres
entatio
n of
SCs
and
STs in
the
Compa
ny as
on 31-
03-
2006 is
as
follows
:
GROU
P TOTAL
STRENGTH
A
B
C
D
D"
(Sweep
ers) 16574
II.
POSTS
FILLED
BY
RECRUIT
MENT :
Class
of Total
posts no. of
vacanci
es
filled
(1) (2) (3) (4)
(5
)
A 177 31 36 25
2
7
B - - - - -
C 1 - - - -
D 1 - - - -
3.
WELFA
RE
ACTIVI
TIES
A)
Welfare
of SCs
& STs:
1) Thre
e
parks
in the
Steel
Town
ship
have
been
name
d
after
Dr. B
R
Amb
edkar
,
Babu
Jagje
evan
Ram
and
Ekala
vya
and a
separ
ate
Librar
y-
cum-
Read
ing
Roo
m
was
name
d
after
Dr B
R
Ambed
kar.
2) Jayant
hi
Celebr
ations
of Dr.
Babu
Jagjee
van
Ram
and
Bharat
Ratna
Dr. B R
Ambed
kar
were
observ
ed by
garlan
ding
functio
ns
followe
d by
comm
emorat
ion
meetin
gs,
which
were
organi
zed at
Babu
Jagjee
van
Ram
Childre
n's
Park,
Sector-
5 on
05.04.
2005
and at
Dr.
Ambed
kar
Park,
Sector-
6 on
14.04.
2005
respec
tively.
3) A
Sports
and
Cultura
l
Festiva
l was
organi
zed
during
the
month
of April
2005
at
CWC,
Ukkun
agara
m in
connec
tion
with
Bharat
Ratna
Dr. B R
Ambed
kar
Jayant
hi
Celebr
ations.
4) In
connec
tion
with
Vardha
nthi
Cerem
ony of
Bhar
at
Ratn
a Dr.
B R
Amb
edkar
,
Garla
nding
Func
tion
was
orga
nized
on
06.1
2.20
05 at
Dr.
Amb
edka
r
Park,
Sect
or-6.
5) RINL
/VSP
has
incre
ased
the
num
ber
of
Scho
larshi
ps
from
3
Nos.
to 6
Nos.
per
year
exclu
sivel
y for
the
childre
n of
SC/ST
employ
ees
from
the
acade
mic
year
2005-
06.
Under
this
Schola
rship
Schem
e, 2
Schola
rships
of
Rs.1,5
00/ -
(Rupe
es One
Thous
and
and
Five
Hundr
ed
only)
per
month
and 2
Schola
rships
of
Rs.750
/-
(Rupe
es
Periph
eral
Develo
pment
se
ve
n
hu
nd
re
d
an
d
(Fi
fty
on
ly)
pe
r
m
on
th
an
d
2
Sc
ho
lar
shi
ps
of
Rs
.4
00
/-
(R
up
ee
s
fo
ur
hu
nd
re
d
on
ly)
pe
r
m
onth
will
be
awar
ded
to
the
merit
oriou
s
stud
ents
amo
ng
SC/S
Ts
ever
y
year.
6) Besi
des,
since
the
year
1991
,
coinc
iding
with
the
Birth
Cent
enar
y
Cele
brati
ons
of
Bhar
at
Ratn
a Dr.
B R
Amb
edka
r,
Annu
al
Merit
Cash
Awar
ds
for
stud
ents
belo
ngin
g to
SC/S
T
com
muni
ties
were
intro
duce
d.
Base
d on
the
pass
resul
ts of
the
Xth/
SSC
Exa
mina
tion
held
durin
g
Marc
h
2005
, 10
nos.
of
Cash
Merit
Awar
ds of
Rs.5
00/-
(Rup
ees
fiv
e
hu
nd
re
d
on
ly)
ea
ch
an
d
9
no
s.
of
Rs
.2
50
/-
(R
up
ee
s
tw
o
hu
nd
re
d
an
d
fift
y
on
ly)
ea
ch
we
re
giv
en
to
th
e
1s
t
an
d
2nd
rank
stud
ents
of
SC/S
T
com
muni
ties
resp
ectiv
ely,
from
each
of
the
scho
ols of
VSP.
B)
General
:
1) RINL
/VSP
has
incre
ased
the
num
ber
of
Scho
larshi
ps
from
11
Nos.
to 30
Nos.
and
also
enha
nced
the
schol
arshi
p
amo
unt
for
the
childr
en of
VSP
empl
oyee
s
from
the
acad
emic
year
2005
-06
unde
r 3
cate
gorie
s of
its
Scho
larshi
p
Sche
mes
i.e.
Gen
eral,
SC/S
T
and
Phys
ically
Hand
icapp
ed.
2) RINL
/VSP
has
intro
duce
d the
new
sche
mes
for
gr
an
t
of
Dr.
Sa
rv
ep
alli
Ra
dh
ak
ris
hn
an
M
eri
t
Ca
sh
A
wa
rd
s
@
Rs
.5,
00
0/-
ea
ch
(o
ne
ti
m
e)
for
th
e
chi
ldr
en
of
V
SP
e
m
pl
oyee
s
who
secu
re
admi
ssion
and
join
IITs,
IIMs
and
IISc
or ISI
cour
ses.
Also
Col.
C K
Nayu
du
Sport
s
Cash
Awar
ds @
Rs.
5,00
0/-
each
(one
time)
for
the
childr
en,
who
have
repre
sent
ed
the
coun
try in
any
even
t or
who
has
won
1st
place
in
the
Natio
nals
cond
ucte
d by
resp
ectiv
e
Fede
ratio
ns of
India
, or
Natio
nal
Scho
ol
Gam
es
and
Sport
s
cond
ucte
d by
Scho
ol
Gam
es
Fede
ratio
n of
India
or
Ranji
or
Inter-
State
Crick
et
Matc
hes
cond
ucte
d
by
B
C
CI.
Th
es
e
Ca
sh
A
wa
rd
sc
he
m
es
ha
ve
be
en
im
pl
e
m
en
te
d
fro
m
th
e
ac
ad
e
mi
c
ye
ar
20
05
-
06
.
3) 43
5
ca
se
s
have
been
cove
red
upto
2005
-06
unde
r
Empl
oyee
s
Fami
ly
Bene
fit
Sche
me
exte
ndin
g
Mont
hly
Bene
fit to
the
depe
nden
ts of
the
dece
ased
empl
oyee
s/Me
dicall
y
Unfit
case
s.
4 IND
UST
RIA
L
REL
ATI
ONS
:
The
over
all IR
situat
ion at
RINL
/VSP
durin
g the
year
2005
-06
was
peac
eful
and
helpe
d in
susta
ining
the
tar
ge
te
d
lev
els
of
pr
od
uct
ion
.
De
spi
te
of
he
cti
c
act
ivit
ies
on
ac
co
un
t
of
Un
ion
El
ect
ion
s,
th
e
E
m
plo
ye
es'
Un
ion
s
de
m
an
d
on
work
relat
ed
issue
s,
vario
us
agitat
ional
activi
ties
by
Regu
lar
and
Contr
act
Labo
ur
union
s,
norm
al
and
safe
level
s of
prod
uctio
n
could
be
maint
ained
due
to
proa
ctive
&
prev
entiv
e IR
meas
ures
adop
ted
by
Pers
onnel
Depa
rtme
nt
and
maint
enan
ce of
harm
oniou
s
Indus
trial
Relat
ions.
I.
SET
TLE
MEN
TS :
1) N
i
g
h
t
S
h
if
t
A
ll
o
w
a
n
c
e
:
R
e
c
o
r
d
N
o
t
e
s
o
f
d
i
s
c
u
s
s
i
o
n
w
a
s
s
i
g
n
e
d
o
n
2
0
.
0
9
.
2
0
0
5
b
e
t
w
e
e
n
t
h
e
r
e
p
r
e
s
e
n
t
a
ti
v
e
s
o
f
M
a
n
a
g
e
m
e
n
t
a
n
d
V
is
a
k
h
a
S
t
e
e
l
E
m
p
l
o
y
e
e
s
C
o
n
g
r
e
s
s
(I
N
T
U
C
)-
R
e
c
o
g
n
is
e
d
U
n
i
o
n
o
n
t
h
e
r
e
vi
si
o
n
o
f
'
N
i
g
h
t
S
h
if
t
A
ll
o
w
a
n
c
e
'
t
o
b
o
t
h
E
x
e
c
u
ti
v
e
s
&

N
o
n
-
E
x
e
c
u
ti
v
e
s
e
m
p
l
o
y
e
e
s
w
.
e
.f
.
0
1
-
0
1
-
2
0
0
5
.
2) M
o
U
o
n
B
o
n
u
s
/
E
x
-
g
r
a
ti
a
F
o
ll
o
w
i
n
g
t
h
e
p
e
r
si
s
t
e
n
t
d
e
m
a
n
d
f
o
r
p
a
y
m
e
n
t
o
f
B
o
n
u
s
/
E
x
g
r
a
ti
a
b
y
t
h
e
U
n
i
o
n
s
,
a
H
ea
lth
ca
re
at
pe
ri
ph
er
al
Ar
ea
s
2>
Rashtriya Ispat i!a"
#td*
M
e
m
o
r
a
n
d
u
m

o
f

U
n
d
e
r
s
t
a
n
d
i
n
g

o
n

p
a
y
m
e
n
t

o
f

A
d
h
o
c
A
d
v
a
n
c
e

t
o

a
ll
e
li
g
i
b
l
e

e
m
p
l
o
y
e
e
s
u
n
d
e
r
A
n
n
u
a
l
P
e
r
f
o
r
m
a
n
c
e

L
i
n
k
e
d

R
e
w
a
r
d

S
c
h
e
m
e

(
A
P
L
R
S
)
w
a
s
s
i
g
n
e
d

o
n

0
8
.
1
0
.
2
0
0
5

w
i
t
h

t
h
e

r
e
p
r
e
s
e
n
t
a
t
i
v
e
s

o
f

R
e
g
d
.

T
r
a
d
e

U
n
i
o
n
s
.
35. DEV
ELO
PME
NTA
L
PRO
GRA
MME
/AW
ARE
NES
S
PRO
GRA
MME
FOR
TRA
DE
UNI
ONS
:
1) A

3
-
d
a
y
D
e
v
e
l
o
p
m
e
n
t
a
l
P
r
o
g
r
a
m
m
e

f
o
r
T
r
a
d
e

U
n
i
o
n
l
e
a
d
e
r
s
w
a
s
h
e
l
d

a
t
C
e
n
t
r
e

f
o
r

H
R
D

o
n

2
3
.
0
3
.
2
0
0
6

o
r
g
a
n
i
z
e
d

b
y

H
R
D

i
n

c
o
o
r
d
i
n
a
ti
o
n

w
it
h

t
h
e

P
e
r
s
o
n
n
e
l
-
C
E
R

s
e
c
ti
o
n
.
2) A
n

o
r
i
e
n
t
a
ti
o
n

p
r
o
g
r
a
m
m
e

w
a
s
o
r
g
a
n
i
z
e
d

o
n

2
4
.
0
2
.
2
0
0
6

b
y
t
h
e

J
t
.

D
i
r
e
c
t
o
r

o
f

E
S
I

C
o
r
p
o
r
a
t
i
o
n

f
o
r

t
h
e

b
e
n
e
f
i
t

o
f

U
n
i
o
n

m
e
m
b
e
r
s
,
C
o
n
t
r
a
c
t
o
r
s
,
C
o
n
t
r
a
c
t
l
a
b
o
u
r
,
P
e
r
s
o
n
n
e
l
E
x
e
c
u
ti
v
e
s
a
n
d

H
o
D
s
r
e
g
a
r
d
i
n
g

t
h
e

b
e
n
e
fi
t
s
o
f
E
S
I
S
c
h
e
m
e

a
n
d

t
h
e

n
e
e
d

f
o
r

c
o
m
p
l
i
a
n
c
e

w
i
t
h

t
h
e

p
r
o
v
i
s
i
o
n
s
o
f
t
h
e

E
S
I
A
c
t
.
3) A

P
r
e
s
e
n
t
a
ti
o
n
-
c
u
m
-
I
n
t
e
r
a
c
ti
o
n

s
e
s
s
i
o
n

o
n

5
S

P
r
o
g
r
a
m
m
e

w
a
s
c
o
n
d
u
c
t
e
d

o
n

2
5
.
0
2
.
2
0
0
6

a
t
T
&
D
C

A
u
d
i
t
o
r
i
u
m

w
i
t
h

e
x
t
e
r
n
a
l

f
a
c
u
l
t
y
.

61. IN
TE
RA
CT
IO
N
WI
TH
UN
IO
NS
:
24
for
mal
mee
tings
were
held
with
unio
ns
inclu
ding
Rec
ogni
sed
Unio
n
duri
ng
year
on
work
relat
ed
issu
es
whic
h
inter
-alia
inclu
de:
1* M
e
e
ti
n
g
o
f
U
ni
o
n
s
w
it
h
Jt
.
S
e
c
r
e
t
a
r
y
(
S
t
e
el
)
a
n
d
2* M
e
e
ti
n
g
w
it
h
N
P
C
t
e
a
m

a
n
d
P
a
n
el
o
f
J
u
d
g
e
s
f
o
r
a
s
s
e
s
s
i
n
g

V
S
P

u
n
d
e
r
P
M
'
s

T
r
o
p
h
y

i
n

J
a
n
u
a
r
y
,
2
0
0
6.
IV.
WORK
ERS'
PARTI
CIPATI
ON :
A
num
ber
of
initia
tives
and
strat
egie
s
were
take
n to
pro
mote
and
sust
ain a
cond
uciv
e IR
clim
ate
for
smo
oth
oper
ation
of
the
Plan
t.
The
most
impo
rtant
initia
tive
in
this
direc
tion
was
stren
gthe
ning
of
the
foun
datio
n of
a
soun
d
and
effec
tive
colle
ctive
barg
ainin
g
syst
em.
To
upho
ld
the
spirit
of
parti
cipat
ion
in
man
age
ment
and
nurt
ure
parti
cipat
ive
cultu
re of
the
Com
pany
,
total
of 81
Joi
nt
Co
mm
itte
es
at
Cor
por
ate,
Sho
p/
De
part
me
nt
lev
els,
Wel
fare
Co
mm
itte
es
at
De
part
me
nt
and
Ape
x
lev
el
hav
e
bee
n
con
stit
ute
d /
rec
ons
titut
ed
to
disc
uss
issu
es
relati
ng to
prod
uctio
n,
prod
uctiv
ity,
quali
ty,
safet
y,
corp
orat
e
affair
s
and
also
othe
r
work
relat
ed
point
s
like
ince
ntive
s,
job
rotati
on,
depl
oym
ent
and
re-
depl
oym
ent.
Spor
adic
incid
ents,
sudd
en
work
stop
page
s
and
pres
sure
tacti
cs
have
dimi
nish
ed to
a
satis
facto
ry
degr
ee
beca
use
of
the
avail
abilit
y of
Parti
cipat
ive
Fora
as
an
instit
ution
al
mac
hiner
y for
venti
latin
g
griev
ance
s
and
resol
ving
genu
ine
de
ma
nds
of
the
em
plo
yee
s.
IMPLE
MENT
ATION
OF
OFFIC
IAL
LANG
UAGE
:
1. Wit
h a
vie
w to
pro
mot
ing
Hin
di in
the
ste
el
Tow
nshi
p,
initi
ativ
es
hav
e
bee
n
tak
en
to
org
anis
e
Hin
di
clas
ses
(Prat
hami
ca,
Mad
yami
ca
and
Rash
tra
MO
U
on
Bo
nus
Ex-
gra
tia
to
Em
plo
yee
s
Hin
di
clas
ses
for
the
wiv
es
of
Em
plo
yee
s
2?
of
Da
ks
hi
n
Bh
ar
at
h
Hi
nd
i
Pr
ac
ha
r
Sa
bh
a)
for
th
e
la
di
es
(H
ou
se
wi
ve
s
of
th
e
e
m
pl
oy
ee
s).
Ex
pe
nd
itu
re
for
Tex
t
boo
ks,
not
e
boo
ks,
tea
chi
ng
aid
s,
acc
om
mo
dati
on,
exa
min
atio
n
fee
etc.
is
met
by
the
ma
nag
em
ent
and
205
ladi
es
are
trai
ned
duri
ng
200
5-
06.
Suc
h
initi
ativ
e
is
firs
t of
its
kin
d
in
the
St
eel
Ind
ust
ry
in
Ind
ia.
Fr
om
Oc
t
'05
,
ab
out
12
5
lad
ies
(wi
ve
s
of
em
plo
ye
es
of
VS
P)
ar
e
trai
ne
d
in
Pr
ath
a
mi
ca
,
M
ad
hy
a
m
a
an
d
Ra
sh
tra
of
Da
ks
hi
n
Bh
ar
at
Hi
nd
i
Pr
ac
ha
r
Sa
bh
a
at
St
ee
l
To
wn
shi
p
(U
kk
un
ag
ar
a
m)
.
2. "Hin
di
port
al"
is
pre
par
ed
and
plac
ed
on
the
intr
ane
t of
Vis
akh
apa
tna
m
Ste
el
Pla
nt
duri
ng
the
curr
ent
fina
ncia
l
yea
r.
Diff
ere
nt
Circ
ular
,
for
mat
s
and
poli
cies
of
the
Co
mp
an
y
obl
iga
tio
ns
&
tar
get
s
of
Off
ici
al
La
ng
ua
ge
are
pla
ce
d
in
the
por
tal.
Sh
us
ha
Fo
nt
is
pla
ce
d
in
the
Intr
an
et
so
tha
t it
ca
n
be
ma
de
us
e
of
by
the
de
pa
rt
me
nts
acr
os
s
the
pla
nt.
DISP
OSA
L OF
STAF
F/
PUBL
IC
GRIE
VAN
CES
RI
NL
/V
SP
ha
s
giv
en
pri
ori
ty
to
th
e
re
dr
es
sal
of
gri
ev
an
ces
-
Staf
f as
well
as
pub
lic
grie
van
ces
.
ST
AF
F
GR
IEV
AN
CE
S
Wit
h a
vie
w
to
pro
vidi
ng
For
um
s
for
red
res
sal
of
grie
van
ces
at
Sh
op/
Sec
tion
/
De
part
me
nt/
Pla
nt/
Co
mp
an
y
lev
el
an
d
set
tlin
g
the
gri
ev
an
ce
s
of
em
plo
ye
es
ex
pe
diti
ou
sly
wit
hin
sti
pul
ate
d
tim
e
so
as to
help
obviati
ng
dissati
sfactio
n, a
compr
ehensi
ve
grieva
nce
redres
sal
syste
m
exists
for
Execu
tive as
well
as
Non-
Execu
tive
emplo
yees.
All
Zonal
Perso
nnel
Execu
tives
have
been
entrus
ted
with
the job
of
dispos
al of
staff
grieva
nce
expedi
tiously.
PUBLI
C
GRIEV
ANCE
S
In
complia
nce
with the
directiv
es of
Ministry
of Steel
from
time to
time,
the
followin
g
actions
have
been
taken
to
activate
Public
Grieva
nce
Redres
sal
System
.
As
regards
the
Public
Grieva
nces
appeari
ng in
the
newspa
per
column
,
Corpor
ate
Comm
unicatio
ns
Depart
ment
is
entrust
ed
with
the job
of
scrutin
izing
and
forwar
ding
the
grieva
nces
to the
concer
ned
Head
of
Depart
ment
who,
in turn
would
exami
ne the
grieva
nce
and
take
prompt
action
for its
redres
sal.
A
senior
level
execut
ive in
the
rank of
Dy.
Gener
al
Manag
er is
functio
ning
as
OSD
(Publi
c
Grieva
nces)
in
order
to
monito
r the
redres
sal of
Public
Grieva
nces
central
ly and
compil
e
monthl
y
status
report
s on
dispos
al of
Public
Grieva
nces
for
submi
ssion
to the
Ministr
y of
Steel.
The
status
of
receipt
and
dispos
al of
Staff/P
ublic
Grieva
nces
during
the
period
2005-
06 is as
under:
Ch
ild
re
n
of
Ba
lab
adi
cel
ebr
ate
In
de
pe
nd
en
ce
Da
y
Pe
rip
he
ral
De
vel
op
me
nt
in
the
ne
ar
by
Vil
lag
es
Description
Staff
Grievances
Public
Grievances
TOWN
ADMINI
STRATI
ON
DEPAR
TMENT
The
exchang
e deed in
respect
of
transfer
of 1400
Acres of
VSP
land to
Govt. of
Andhra
Pradesh
for
develop
ment of
Port at
Gangava
ram was
signed
by the
represen
tatives of
Ministry
of Steel,
Union of
India and
Govt of
Andhra
Pradesh
and the
same
has been
registered
at Sub-
Registrar's
Office,
Gajuwaka.
60 nos. of
quarters
(30 nos. A
Type and
30 Nos. B
Type)
constructe
d by M/s
HSCL on
the land
allotted by
VSP on
licence
basis has
been
taken over
by VSP on
payment
of
reasonabl
e
compensat
ion to be
assessed
by VSP.
The
quarters
have been
utilized for
VSP's
purposes.
CORPOR
ATE
SOCIAL
RESPON
SIBILITY
(CSR):
RINL has
given
special
emphasis
on CSR
with the
following;
1) The
Policy
on
Corpor
ate
Social
Respo
nsibilit
y has
been
formul
ated.
2) RINL
has
filed its
applica
tion for
memb
ership
in
UNO
Global
Compa
ct and
the
same
has
been
admitt
ed.
3) CSR
Calend
ar of
Events
for
implem
entatio
n
during
the
year
2005-
06 has
been
prepar
ed and
the
sam
e
has
been
implem
ented.
4) RINL
Format
ion
Day on
18.02.
2006
was
celebr
ated
with
empha
sis on
Health,
Comm
unity
Develo
pment,
Enviro
nment
Enrich
ment
and
Cultura
l
Efflore
scence
.
The
followi
ng
progra
mmes
were
organi
zed on
this
occasi
on:
1) RI
NL
He
alt
h
Ru
n
inv
olvi
ng
mo
re
tha
n
25
00
em
plo
ye
es,
pe
opl
e
fro
m
var
iou
s
wal
ks
of
life
2) Ha
ndi
ng
ov
er
sp
eci
ally
de
sig
ne
d
bu
s
to
Ar
un
od
ay
a
Sp
eci
a
l
S
c
h
o
o
l
f
o
r
m
e
n
t
a
ll
y
r
e
t
a
r
d
e
d
c
h
il
d
r
e
n
3) L
a
u
n
c
h
i
n
g
o
f
A
g
r
o
-
for
est
ry,
Pla
nta
tio
n
of
bio
-
die
sel
pla
nt
Jet
rop
ha
to
co
ver
a
tot
al
of
30
0
He
cta
res
;
out
of
thi
s,
50
He
cta
res
dur
ing
20
06-
07.
4) Dis
trib
uti
on
of
JN
Aw
ard
s,
Ec
ho
Aw
ard
s,
Sh
ruj
an
Vik
as
Aw
ard
s
foll
ow
ed
by
a
var
iet
y
Cul
tur
al
pro
gra
m
me
.
All
C
W
Cs
in
Re
ha
bilit
ati
on
Ce
ntr
es
an
d
Mi
ne
s
a
ls
o
c
e
l
e
b
r
a
t
e
d
R
I
N
L
F
o
r
m
a
ti
o
n
D
a
y.
5) RINL
CSR
Polic
y has
adopt
ed a
four-
fold
strate
gy of
RINL
as a
Prom
oter,
as a
Partn
er, as
a
Facili
tator
and as
a
Consult
ant to
promot
e CSR
activitie
s.
6) Some
of CSR
activiti
es
taken
up :
Wome
n in
Public
Sector
(WIPS)
Day
celebrati
ons
<0
1) W
ork
sh
op
"To
wa
rds
Ex
cel
len
ce"
for
tea
ch
ers
of
VS
P
Sc
ho
ols
wa
s
co
nd
uct
ed
on
7th
&
8th
Se
pte
mb
er
20
05
in
as
so
cia
tio
n
wit
h
An
dhra
Univ
ersit
y,
UGS
-
Aca
demi
c
Staff
Coll
ege.
2) "Stu
dent
s
Cou
nsell
ing-
Com
pete
ncy
Dev
elop
-
men
t
Prog
ram
me"
for
stud
ents
(7th
and
10th
clas
s)
app
eari
ng
for
Publ
ic
Exa
mina
tion
was
cond
ucted
on
10th
Nov.
2005.
3) Works
hop
"Tow
ards
Excel
lence
" for
teach
ers of
VSP
Scho
ols
was
cond
ucted
on
11th
&
12th
Nove
mber
2005
in
asso
ciatio
n
with
Andh
ra
Unive
rsity,
UGS
-
Acad
emic
Staff
Colle
ge.
4) Adult
litera
cy
and
fe
ma
le
lite
rac
y
dri
ve
thr
ou
gh
UK
KU
AK
SH
AR
A
JY
OT
HI
pr
og
ra
m
me
s
we
re
or
ga
niz
ed
on
09.
01.
20
06
in
Ag
an
am
pu
di
&
Va
dla
pu
di
Re
habil
itatio
n
Colo
nies.
5) Pers
onali
ty
Dev
elop
men
t for
Sch
ool
child
ren,
inter
activ
e
sess
ion
on
"Pro
ve
Your
self
and
Dev
elop
Your
Pers
onali
ty"
was
orga
nize
d on
18.0
1.20
06
at
De
Paul
Sch
ool,
Ukk
una
gara
m.
6) With a
view
to
sensit
izing
reside
nts of
five
Reha
bilitati
on
Colon
ies
and
Mines
, the
Multi-
Purpo
se
Social
Servi
ce
Camp
s/Pro
gram
mes
were
organ
ized
at the
follow
ing
place
s
durin
g this
year
under
CSR
Calen
dar of
event
s.
Thes
e
progr
amm
es
inter-
ali
a
inc
lud
es
wo
rks
ho
p
on
Mo
the
r &
chi
ld
Ca
re,
De
-
ad
dic
tio
n,
Lif
e
Sty
le
Ma
na
ge
me
nt,
Sel
f-
em
plo
ym
ent
&
Sel
f
He
lp
G
r
o
u
p
s
(
S
H
G
s
)
,
C
l
e
a
n

&

G
r
e
e
n

E
n
v
i
r
o
n
m
e
n
t
,
e
t
c
.
a
n
d

a

Pl
a
y-
le
t
o
n
A
I
D
s
a
w
ar
e
n
e
s
s.
MANAG
EMENT
SERVIC
ES
1 VSP
bagg
ed
Six
Gover
nmen
t of
India
Vishw
akar
ma
Rasht
riya
Puras
kar
(VRP)
Awar
ds at
nation
al
level
out of
total
28
aw
ard
s
an
no
un
ce
d
by
Mi
nis
try
of
La
bo
ur.
On
e
fift
h
of
the
tot
al
aw
ard
s
are
ba
gg
ed
by
VS
P
an
d
32
aw
ard
ee
s
fro
m
VS
P
are
mo
re
tha
n
1/3rd
of
the
total
at
Natio
nal
level.
VRP
is
one
of
high
est
level
of
awar
d
pres
ente
d to
work
man
in
reco
gnisit
ion
of
their
contr
ibuti
on
by
Govt
of
India
.
2 VSP
has
bagg
ed
Gold
Med
al in
Tech
nical
Pap
er
Cont
est
and
Silver
Meda
l in
Best
Sugg
estor
s
Cont
est at
16th
INSS
AN
Natio
nal
Conv
entio
n
held
at
Mum
bai in
Jan'0
6.
3 4131
Quali
ty
circle
proje
cts
imple
ment
ed
with
an
empl
oyee
involv
emen
t of
74%.
4 For
the
first
time
14
QC
tea
ms
re
pr
es
ent
ed
at
Qu
alit
y
Cir
cle
Na
tio
nal
Co
nv
ent
ion
at
Er
na
kul
um
.
Fo
ur
tea
ms
rat
ed
as
pa
r
ex
cel
len
ce,
se
ve
n
as
ex
cel
len
t
an
d
thre
e as
disti
ngui
shed
.
5 One
QC
team
was
awar
ded
first
prize
at
Stat
e
level
by
CII
at
Hyd
erab
ad
and
parti
cipat
ion
awar
d at
Regi
onal
level
,
Che
nnai.
6 For
the
first
time
18
empl
oyee
s
from
2
QC
team
s
sent
abroa
d to
partic
ipate
in
Intern
ation
al
Conv
entio
ns.
One
QC
team
prese
nted
at
IEIQ
C-
Qual
ity
Circl
e
Nite
cele
brati
ons
2005
(Inter
natio
nal
Expo
sition
and
Inno
vatio
n on
Quali
ty
Circl
es)
at
Sing
apor
e
and
the
other
at
ICQ
CC-
2005
(Inter
natio
nal
Quali
ty
Cont
rol
Circl
es)
at
Sout
h
Kore
a. It
was
a
great
motiv
ation
as
Non-
Execut
ive
employ
ees
presen
ted at
Interna
tional
forums
.
1 33201
sugges
tions
receive
d and
8712
implem
ented.
Sugge
stion
campai
gns on
"Energ
y
Conser
vation"
,
"Safety
" and
"Finan
ce"
conduc
ted.
2 Receiv
ed 3rd
prize
for
"Organ
isation
al
Excelle
nce
Award
in
Sugge
stion
Schem
e" at
INSSA
N
Nation
al
Conve
ntion,
Mumb
ai.
3 The 5
S
activiti
es -
Work
Place
Manag
ement
have
been
taken
up in
most
of the
depart
ments.
PROJEC
T
MANAGE
MENT
Expansion
of the
Plant to
6.3Mt :
Keeping in
view the
upturn in
global and
domestic
steel
demand,
VSP has
decided to
increase its
capacity to
6.3 Mt of
liquid steel
per year in
the
beginning
and to
increase
the
capacity
upto 10
Mt per
year in
future
phases.
M/s MN
Dastur
Co, the
Consulta
nts
engaged
for
preparati
on of
Project
Report
for
Expansio
n of VSP
submitted
the
Report
for
Expansio
n of Plant
to 6.5 Mt
of hot
metal
and 6.3
Mtpa of
liquid
steel.
The
product
mix is
long
products
such as
wire rods
in coils
5.5 mm
to 20 mm
dia,
special
bars of size
16mm to
40 mm dia
in coil and
straight
length and
light &
structural
to meet the
infrastructu
re needs
which are
very well
accepted in
the market.
In addition,
Seamless
Pipe
Mill of
300,000
tpa
capacity to
produce
seamless
pipes of
higher dia
is planned
which will
be first of
its kind in
India.
The salient
features of
the
Expansion
are as
follows:
Capital cost :
Rs.86
92
crores (Base: II
Quarter
2005
)
Construction
schedule :
Stag
e-I
- 36 months from "Date
of
approval by GOI"
Stag
e-II
- 48 months from "Date
of
approval by GOI"
GOI
approved
the project
on 28th
October
2005 at an
estimated
cost of
Rs.8692
crores.
Preparatio
n of
specificatio
ns and
tender
documents
are under
progress.
Some
preliminary
works
such as
roads,
box
culvert
and
lighting
etc. have
already
been
ordered
and work
is under
progress
. An
amount
of
Rs.6.69
crores
has been
spent
upto
31.03.06
.
COKE
OVEN
BATTE
RY - 4
(PHAS
E-I)
Governm
ent of
India
approve
d setting
up of
Battery
No.4 in
Decemb
er 2003
at a cost
of
Rs.303
crores to
meet the
coke
requirem
ent.
Construc
tion of
the battery
is in
progress
and the
project is
likely to be
commissio
ned by
December
2006. An
amount of
Rs.165.66
crores has
been spent
upto
31.03.06.
COKE
OVEN
BATTER
Y
(PHASE-
II)
Projects for
constructio
n of By
Product
Plant and
Additional
facilities on
coal side
have been
approved
by the
Board of
Directors in
June, 2006
at an
estimated
Mod
el of
Mai
n
gate
-
Exp
ansi
on
Con
stru
ction
work
at
Cok
e
Ove
n
Batt
ery
No.
4
cost of
Rs.10
9.39
crores
and
Rs.88.
83
crores
with a
compl
etion
period
of 27
month
s and
24
month
s
respec
tively.
PULV
ARIS
ED
COA
L
INJE
CTIO
N
SYST
EM
Propo
sals
for
install
ation
of
Pulvar
ised
Coal
Injecti
on
syste
m in
Blast
Furna
ces
No.1 & 2
has
since
been
approve
d by the
Board in
July,
2006.
The
pulverize
d
scheme
enhance
s the
capacity
of hot
metal
productio
n in BF-1
& 2. The
salient
features
of the
scheme
are as
follows:
Capital cost
Construction
schedule
CORPO
RATE
STRAT
EGIC
MANA
GEMEN
T
1 MOU
2005
-06
Secr
etary,
Minis
try of
Steel
,
GoI,
and
CMD
,
RINL
signe
d
MOU
on
28.3.
2005
for
achie
ving
the
set
physi
cal
and
fiscal
targe
ts for
the
year
2005
-06.
As
per
the
perfo
rman
ce
evalu
ation
base
d on
provi
siona
l
data,
the
com
pany
achie
ved
a
com
po
sit
e
sc
or
e
of
1.
37
,
wh
ich
co
rre
sp
on
ds
to
Ex
cel
le
nt
rat
in
g
for
th
e
ye
ar.
2. Pa
rti
ci
pa
tio
n
in
Su
st
ai
na
bil
ity
Re
po
rti
ng
of
steel
indu
strie
s
acro
ss
the
worl
d
The
Inter
natio
nal
Iron
&
Steel
Instit
ute
(IISI)
, has
start
ed
prep
aring
Glob
al
Sust
aina
bility
Repo
rt for
the
world
steel
indus
try
since
2004
. The
repor
t for
2005
has
been
publi
shed
. The
para
mete
rs of
susta
inabil
ity
relat
e to
Econ
omic,
Soci
al
and
Envir
onm
ental
aspe
cts.
RINL
parti
cipat
ed in
the
prep
arati
on of
the
repor
ts
and
sub
mitte
d
data
on
the
identi
fied
11
Sust
aina
bility
Indic
ators
. It is
wort
h
ment
ionin
g
that
RI
NL
's
po
siti
on
in
20
05
ha
s
be
en
be
tte
r
th
an
th
e
wo
rld
av
er
ag
e
on
7
ou
t
of
11
pa
ra
m
et
er
s
as
ca
n
be
se
en
fro
m
th
e
ta
ble
given
belo
w.
No. Indicator World
RIN
L Units
Average
1 Investment in 6.2 0.76 % of
New
Processes Revenue
and Products
2
Operating
Margin 15.7 26.7 % of
Revenue
3
Return on
Capital 22.3 31.8
% of
Capital
Employed
(ROCE)
Employe
d
4 Value Added 11.7 14.0 % of
Revenue
5
Energy
Intensity 19.1 28.3
GJ /
Tonne
of Crude
Steel
Produced
6
Greenhouse
Gas 1.7 3.1
Tonnes
of
Emissions CO2 /
Tonne of
Crude
Steel
Produced
7
Material
Efficiency 95.6 100.0 %
8
Steel
Recycling 42.7 7.9 % of
recycled
Steel
used in
production
of
crude
steel
9 Environmental 90.7 99.1
% of
Total
Management and
Systems
Contract
ors
Employe
es
Working
in
Registere
d
Productio
n
Facilities
<
<
Drive
s;
Pum
ps;
Rolli
ng
Mills.
4. Chai
rman
Onli
ne
"Chai
rman
Onlin
e" an
intra
net
base
d
com
muni
catio
n
foru
m,
facilit
ating
direct
inter
actio
n of
empl
oyee
s
with
CMD
to
impr
ove
the
orga
nizati
onal
perfo
rman
ce,
was
launc
hed
in
Januar
y,
2005.
Till
March
2006,
about
450
querie
s
submitt
ed by
employ
ees on
issues
like
system
s
improv
ement,
produc
tivity
improv
ement
s,
current
challen
ges
and
possibl
e
solutio
ns,
employ
ee
develo
pment
and
welfare
, etc.
have
been
mostly
replied
within
a few
days of
submis
sion
and on
an
averag
e the
respon
se time
is less
than a
week .
The
initiativ
e has
becom
e very
popula
r as
seen
from
the
survey
conduc
ted in
Januar
y 2006
wherei
n 90%
of the
employ
ees
have
expres
sed
comple
te
satisfa
ction
and
happin
ess
with
regard
to its
workin
g and
rated
its
effectiv
eness
as
7.9
on a
10
point
scale
.
5. Mark
et
Surv
ey
Mark
et
surve
y
was
cond
ucted
by
Mark
et
Rese
arch
Grou
p of
CSM
Dept.
to
asse
ss
pote
ntial
for
openi
ng
outlet
s in
the
state
s of
Hima
chal
Prad
esh,
Chair
man
On-
Line
Jh
ar
kh
an
d,
Ch
att
isg
ar
h
an
d
Po
nd
ich
err
y.
It
wa
s
br
ou
gh
t
ou
t
th
at
ad
eq
ua
te
po
te
nti
al
exi
sts
for
op
en
ne
w
br
an
ch
es in
Jams
hedp
ur
and
Raip
ur. In
other
place
s,
wher
e
dem
and
is not
asse
ssed
to be
suffic
ient
for
open
ing
Bran
ch
office
s,
Cons
ignm
ent
Sale
s
Agen
ts or
Deal
ers
have
been
sugg
este
d.
Actio
ns
have
been
initiat
ed
acco
rding
ly.
VIGILA
NCE
ACTIVI
TIES
During
the year:
(1) Vigila
nce
Depa
rtme
nt
cond
ucte
d
390
syste
m
chec
ks
inclu
ding
20
qualit
y
chec
ks
and
93
rake/
road
re-
weig
hme
nts.
The
Vigila
nce
obse
rvati
ons
were
brou
ght
to
the
no
tic
e
of
th
e
co
nc
er
ne
d
for
ta
kin
g
co
rre
cti
ve
ac
tio
ns
/i
m
pr
ov
e
m
en
t
of
th
e
exi
sti
ng
pr
oc
ed
ur
es
/sy
st
e
m
s,
wh
er
ev
er
requi
red.
(2) Vigila
nce
Awar
enes
s
Wee
k
was
obse
rved
durin
g the
week
7th
Nove
mber
to
11th
Nove
mber
2005
.
Durin
g the
week
,
from
7th
Nove
mber
to
11th
Nove
mber
2005
,
pres
entat
ions
cum
inter
actio
n
sessi
ons
were
held,
whic
h
were
atten
ded
by
lower
level
and
middl
e
level
Exec
utive
s of
the
com
pany,
Trad
e
Unio
n
Lead
ers
and
Offic
e
bear
ers,
Vend
ors,
Cust
omer
s
and
Cont
racto
rs.
Durin
g
thes
e
sessi
ons,
relev
ant
issue
s
we
re
dis
cu
ss
ed
,
do
ub
ts
cla
rifi
ed
an
d
pr
ac
tic
al
in
pu
ts
we
re
im
pa
rte
d
to
th
e
pa
rti
cip
an
ts.
(3) O
n
th
e
pr
ev
en
tiv
e
vig
ila
nc
e
front,
great
er
thrus
t was
laid
on
exa
mina
tion
of
tend
ers
at
the
proc
essin
g
stag
e
with
a
view
to
modi
fying
certa
in
restri
ctive
tend
er
claus
es in
line
with
CVC
guide
lines
on
the
issue
so as
to
bring
in
great
er
trans
pare
ncy
and
incre
ased
comp
etitio
n.
(4) In
order
to
provi
de
yet
anot
her
platfo
rm
for
any
citize
n,
nece
ssary
publi
city
has
be
en
giv
en
in
th
e
ne
ws
pa
pe
rs
an
d
th
e
we
bsi
te
of
VS
P
th
at
an
y
co
m
pla
int
m
ad
e
to
th
e
C
V
O
thr
ou
gh
W
eb
sit
e
wo
uld
als
o be
enter
taine
d
and
proc
esse
d
furth
er for
suita
ble
actio
n.
(5) Proa
ctive
Vigila
nce
work
was
done
in the
area
s of
estim
ation,
awar
d
and
exec
ution
of
contr
acts
perta
ining
to
oper
ation,
maint
enan
ce,
proc
urem
ent
and
mark
eting
and
man
age
ment
exhib
ited
positi
ve
attitu
de
towar
ds
the
sugg
estio
ns of
the
Vigila
nce.
(6) The
work
relat
ed to
obtai
ning
ISO
Certif
icatio
n for
Vigila
nce
by
June
2006
is
progr
essin
g
well.
This
woul
d
furth
er
the
effort
s in
strea
mlini
ng
pr
oc
ed
ur
es,
sy
ste
ms
an
d
ac
co
un
ta
bili
ty.
(vii)Cl
os
e
int
er
act
ion
wa
s
m
ain
tai
ne
d
wit
h
C
BI.
Pe
ndi
ng
ca
se
s
we
re
re
vie
we
d
pe
rio
dic
ally
and
full
co-
oper
ation
was
exten
ded
to
them
.
(viii)All
the
perio
dical
statis
tical
retur
ns/re
ports
were
subm
itted
to
MOS
,
CVC,
CBI
and
DOP
T in
time.
AUDIT
ORS
M/s. Rao
& Kumar,
Visakhap
atnam
have
been
appointe
d as the
Statutory
Auditors
of the
company
for the
year 05-
06 by the
Comptrol
ler and
Auditor
General
of India.
Vigil
ance
Awa
rene
ss
Prog
ram
mes
AUDIT
ORS'
REPOR
T
The
Statutory
Auditors'
Report
on the
Accounts
of the
Compan
y for the
financial
year
ended
31st
March
2006 in
terms of
Section
217(3) of
the
Compani
es Act,
1956
along
with
Manage
ment
Replies
thereon
are
enclosed
to the
Directors
' Report
as
Annexur
e-I.
C & A G
REVIE
W
The
Commen
ts of the
Comptrolle
r & Auditor
General of
India
(C&AG)
alongwith
Managem
ent
Replies
thereon
and also
the Review
on
Accounts
of the
Company
are
enclosed
as
Annexure-
II.
REPORT
ON
CONSER
VATION
OF
ENERGY,
TECHNO
LOGY
ABSORP
TION
etc..
Information
in
accordance
with the
provisions
of Section
217(1) (e)
of the
Companies
Act, 1956,
read with
the
provisions
of
Companies
( Disclosur
e of
particulars
in the
Report of
the Board
of
Directors)
Rules,
1988,
regarding
Conservati
on of
Energy,
Technology
absorption
and
Foreign
Exchange
earnings
and outflow
are
furnished in
the
Annexure -
A to this
report and
also in
Form -A
and Form
-B annexed
to this
report.
Foreign
Exchange
earnings
and outgo
:
The Export
performanc
e of the
Company
has
improved
significantly
as
compared
to the
previous
year.
The
Foreign
Exchang
e
earnings
during
the year
2005-06
was Rs.
443.51
Crores as
against
Rs.
259.27
Crores
during
the
previous
year. The
Foreign
Exchang
e outgo
during
the year
2005-06
was
Rs.1867.
30
Crores as
against
Rs.1386.
50
Crores
during
the
previous
year
PARTIC
ULARS
OF
EMPLO
YEES
There
was no
employee
of the
company
who
received
remunerati
on in
excess of
the limits
prescribed
under
Section
217(2A) of
the
Companies
Act 1956
read with
the
Companies
(particulars
of
employees)
Rules ,
1975.
DIRECT
ORS
RESPON
SIBILITY
STATEM
ENT
In terms of
Section
217 (2AA)
of
Companie
s Act,
1956,
your
Directors
state as
follows :
(1) that in
the
prepar
ation
of the
annual
accoun
ts, the
applica
ble
accoun
ting
standa
rds
had
been
followe
d
along
with
proper
explan
ation
relatin
g to
materi
al
depart
ures;
(2) that
the
directo
rs had
selecte
d such
accoun
ting
policie
s and
applied
them
consist
ently
and
mad
e
judge
ment
s and
estim
ates
that
are
reas
onabl
e
and
prud
ent
so as
to
give
a
true
and
fair
view
of
the
state
of
affair
s of
the
comp
any
at
the
end
of
the
finan
cial
year
and
of
the
profit
or
loss
of
the
comp
any for
that
period;
(3) that
the
directo
rs had
taken
proper
and
sufficie
nt care
for the
mainte
nance
of
adequ
ate
accoun
ting
record
s in
accord
ance
with
the
provisi
ons of
this Act
for
safegu
arding
the
assets
of the
compa
ny and
for
preven
ting
and
detecti
ng
fraud
and
other
irregul
arities.
(4) that
the
directo
rs had
prepar
ed the
annual
accoun
ts on a
going
concer
n
basis.
CORPOR
ATE
GOVERN
ANCE
As a part of
Corporate
governanc
e initiative,
a
Committee
of Directors
comprising
all
functional
Directors
and
headed by
the
Chairman-
cum-
Managing
Director
was
constituted
in
September
1998 and
has been
functioning
since then
for
reviewing
the
important
observation
s of
Internal
Audit and
for taking
expeditio
us
actions
by
concerne
d
Departm
ents
wherever
A
u
di
t
C
o
m
m
itt
ee
co
ns
tit
ut
ed
wi
th
In
de
pe
n
de
nt
D
ir
ec
to
rs
in
Jul
y
06
hel
d
its
1st
Me
etin
g
on
30-
8-
200
6 at
Vis
akh
apa
tna
m
<6
neces
sary.
The
Comm
ittee
has
held
meetin
gs
periodi
cally
during
the
year.
Appro
priate
correc
tive
action
s
where
ver
found
neces
sary
were
taken
which
resulte
d in
consid
erable
saving
s to
the
Comp
any.
The
Intern
al
Audit
Depart
ment
is
mann
ed
with both
professio
nal
Chartere
d
Account
ants and
Engineer
ing
professio
nals for a
wider
coverage
of
technical
aspects
as well
for
evolving
better
controls
systems
and
procedur
es and
improved
savings.
DIRECT
ORS
( APPOI
NTMEN
T /
CESSA
TION) :
The
following
changes
took
place in
the
Board of
Directors
of the
Compan
y during
the year.
Shri G.
Elias, Jt.
Secretar
y in the
Ministry
of Steel
was
appointe
d as
Part-time
Official
Director
w.e.f.
13th
April,
2006.
Shri
R.S.S.L.
N.
Bhaskar
udu, ex-
Chairma
n of
PESB
was
nominate
d as
part-time
non-
official
Director
on the
Board of
RINL
and he
assumed
charge
as
Indepen
dent
Director
w.e.f.
26th
April,
2006.
Dr. V K
Bhalla
was
appointe
d as
part-
time
non-
official
Direct
or on
the
Board
of
RINL
with
effect
from
29th
June,
2006.
Shri J
S
Mathu
r was
appoin
ted as
part-
time
non-
official
Direct
or on
the
Board
of
RINL
with
effect
from
11th
July,
2006.
Shri P
K
Misra
was
appoin
ted as
Direct
or
(Oper
ations)
on the
Board of
RINL
with
effect
from
01.08.20
06.
Shri J.P.
Singh,
Jt.
Secretar
y,
Ministry
of Steel
ceased
to be
part-time
Official
Director
with
effect
from
24th
January,
2006 on
his
resignati
on from
the
Board.
Dr. S.N.
Dash, Jt.
Secretar
y,
Ministry
of Steel
ceased
to be
part-time
Official
Director
with
effect
from 7th
April,
2006 on
his
resignati
on from
the
Board.
Shri K K
Rao,
Director
(Operati
ons)
ceased
to be
function
al
Director
with
effect
from 1st
August,
2006 on
his
superan
nuation
from the
Board.
The
Board
of
Direct
ors
wish
to
place
on
record
their
appre
ciation
of the
valuab
le
servic
es
render
ed
and
contrib
ution
made
by the
outgoi
ng
Direct
ors
during
their
tenure
on the
Board
of
RINL.
ACK
NOW
LED
GEM
ENTS
The
Board
placed
on
record
its
deep
appreciat
ion for
the
assistan
ce,
cooperati
on and
guidance
received
in full
measure
provided
by the
Govt. of
India in
general
and
Ministry
of Steel
in
particular
, the
Govt. of
Andhra
Pradesh,
various
suppliers
/custome
rs.
The
Board
also
specifical
ly
acknowl
edge
their
gratitude
to the
various
Ministrie
s of the
Govt. of
India
with
whose
positive
and pro-
active
support,
the
approval
by Govt.
of India
for the
Expansio
n of the
Plant
could be
accorded
in record
time.
The
Board
place on
record its
appreciat
ion for
the
cooperati
on
extended
by its
valued
customer
s,
suppliers
,
bankers,
auditors,
solicitors
and
business
associat
es, the
local
District
Administ
ration
and Law
& Order
authoritie
s.
The
Board
also
places
on
record
its
appre
ciation
for the
commi
tment,
sincer
e
efforts,
hard
work
and
contrib
ution
put in
by all
the
emplo
yees
of the
Comp
any
who
are
instru
mental
in
scalin
g new
heights
year
after
year and
the
cooperati
on
extended
by
employe
es
Unions
and
Steel
Executiv
e
Associati
on for
the
status of
MINIRAT
NA.
For
and
on
beh
alf
of
the
Boar
d of
Dire
ctor
s
(Y. SIVA
SAGAR
RAO )
Chairm
an-
cum-
Managi
ng
Directo
r
Visakhap
atnam
Date :25-
09-2006
Adopted
at the
24th
Annual
General
Meeting
held on
25th
Septemb
er, 2006.
<>
HIGHLIGHTS
A OPERATING RESULTS
Turnover
Gross Income
Gross Expenditure
Gross Profit
Gross Profit (excluding Interest on Term
Deposits)
Profit before Tax
Net Profit After Tax
B YEAR END FINANCIAL POSITION
Share Capital
Reserves and Surplus
Capital Employed
Capital Employed (excluding Term Deposits)
Net Worth
Gross Block
Depreciation
Net Block
Inventory
C PROFITABILITY AND OTHER RATIOS
(I) PERCENTAGE OF:
Gross Profit to Sales
Net Profit to Sales
Gross Profit to Net Worth
Net Profit to Net Worth
Gross Profit (excluding Interest on Term
Deposits) to Capital Employed (excluding
Term Deposits)
Net Profit to Capital Employed
Gross Profit to Share Capital
Inventory to Sales
Sales to Capital Employed
(ii) RATIO OF:
Current Assets to Current Liabilities 5.62 4.53
Quick Assets to Current Liabilities 4.79 3.59
<
?
FINANCIAL
RESULTS
Year
Turnove
r Other
Incom
e
Ra
w Stock
Employe
e Depre-
Interest
& Stores, Profit /
Revenu
e Material
Accretio
n/
Remun
e- ciation Wealth R&M,
consum
ed
Decretio
n ration & DRE Tax
Power
& before
&
Benefits
Expense
s Other
1990-
91 245.15 35.50 244.71 175.27 -26.69 29.14 197.23 192.13 191.12 -477.55
1991-
92 772.44 22.20 675.83 401.94 -69.61 53.86 449.09 437.26 509.03 -986.93
1992-
93 1184.84 147.63
1245.1
0 680.17 -151.60 76.52 340.07 197.56 758.04 -568.29
1993-
94 1751.04 156.03
1526.4
4 875.4 160.21 102.5 339.84 346.86 654.92 -572.66
4
=
1994-
95 2208.57 50.22
2091.7
9 1058.53 -199.67 128.46 414.65 365.97 855.13 -364.28
1995-
96 3038.57 115.92
2809.7
6 1310.69 -50.45 154.66 430.12 407.11 1106.63 -204.27
1996-
97 3135.29 78.40
2888.0
8 1384.56 -114.83 174.42 421.87 430.48 1163.13 -245.94
1997-
98 3070.93 96.96
2750.9
2 1405.31 -118.27 210 438.52 198.23 1210.83 -176.73
1998-
99 2761.13 197.06
2181.6
9 1219.66 317.61 255.04 111.27 360.88 1150.91 -457.18
1999-
00 2972.60 154.79
2636.1
1 1394.32 -95.10 272.49 431.79 382.16 1303.41 -561.68
2000-
01 3435.96 179.79
3048.8
8 1443.68 -103.38 407.65 444.60 350.59 1363.91 -291.30
2001-
02 4080.95 152.92
3395.7
4 1602.1 62.37 375.02 474.98 290.52 1504.03 -75.15
2002-
03 5058.25 167.63
4107.1
6 1805.65 281.09 405.99 454.61 123.19 1634.66 520.69
2003-
04 6169.09 209.23
5398.2
5 2050.43 25.61 481.15 476.47 49.05 1748.42
1547.1
2004-
05 8181.34 286.33
7583.8
0 3019.64 -310.39 490.24
1006.1
2 11.11 1997.18
2253.7
2005-
06 8482.44 455.88
7412.5
7 3584.62 65.85 572.34 448.29 31.24 2346.47
1889.5
A
n
n
u
a
l

R
e
p
o
r
t

2
0
0
5
-
0
6
SIXTEEN YEARS DIGEST
FINANCIAL RESULTS
Rs. in
Crores
Year Capital Reserves Loans/ Fixed Total Fixed
Number
of
& Surplus Buyers Assets Depre- Assets
Employee
s
Credit Gross ciation
Net
Block as on
Block
31st
March
1990-
91 3505.85 -- 3924.44 3720.13 247.91 3472.22 14433
1991-
92 3505.85 -- 5476.29 5030.79 703.94 4326.85 16656
1992-
93 3705.85 -- 3494.61 6156.78 1026.04 5130.74 17454
1993-
94 6493.85 -- 3473.68 7325.83 1364.76 5961.07 17483
1994-
95 6493.85 -- 3734.56 8288.71 1746.79 6541.92 17369
1995-
96 6493.85 -- 3830.60 8391.69 2176.86 6214.83 17642
1996-
97 6493.85 -- 3734.89 8547.87 2819.16 5728.71 17478
1997-
98 6493.85 -- 2204.5 8592.03 3037.22 5554.81 17354
1998-
99 6493.85 -- 2242.79 8615.46 3148.35 5467.11 17400
1999-
00 7827.32 -- 2343.36 8635.28 3580.26 5055.02 17254
2000-
01 7827.32 -- 2293.18 8642.69 4012.35 4630.34 17131
2001-
02 7827.32 -- 1989.38 8702.79 4467.75 4235.04 17026
2002-
03 7827.32 -- 1185.92 8730.76 4903.18 3827.58 16894
2003-
04 7827.32 -- 37.17 8709.72 5337.59 3372.13 16755
2004-
05 7827.32 -- 531.36 8763.49 6322.18 2441.31 16613
2005-
06 7827.32 346.38 457.59 8832.13 6753.87 2078.26 16574
42
Audited
A44ounts
2005-06
4<
44
Annual Report 2005-
06
Balance Sheet as at 31st March
2006
Rupees in
Crores
Schedule
As
at
A
s
at
No.
31st March,
2006
31st March,
2005
SOURCES OF FUNDS:
SHAREHOLDERS FUNDS:
Share Capital 1 7827.32 7827.32
RESERVES & SURPLUS :
Profit & Loss Account 346.38
LOAN FUNDS :
Secured loans 2 88.15 88.94
Unsecured loans 3 369.44 442.42
Deferred Tax Liability ( Net ) 316.72 158.49
Total
8948.01 8517.17
APPLICATION OF FUNDS:
FIXED ASSETS :
Gross block 4 8832.13 8763.49
Less: Depreciation 6753.87 6322.18
Net block 2078.26 2441.31
Held for disposal 5 0.01 0.00
Capital work-in-progress 6 180.73 58.85
2259.00 2500.16
INVESTMENTS 8 0.00 0.00
CURRENT ASSETS, LOANS & ADVANCES :
Inventories 9 1216.45 1257.53
Sundry debtors 10 165.65 49.30
Cash & Bank balances 11 5621.70 3932.61
Other Current assets 12 184.36 100.18
Loans & Advances 13 1063.84 710.12
8252.00 6049.74
LESS: CURRENT LIABILITIES & PROVISIONS :
871.49
Liabilities 14 712.46
Provisions 15 716.37 269.27
1587.86 981.73
Net Current Assets 6664.14 5068.01
MISCELLANEOUS
EXPENDITURE 16 24.87 43.01
(to the extent not written off or
adjusted)
PROFIT & LOSS ACCOUNT 905.99
Total
8948.01 8517.17
Accounting Policies & Notes to
Accounts 28
Schedules 1 to 28 annexed form part of the Accounts
As per our separate report of even date
For RAO & KUMAR
Chartered Accountants
Sd/- Sd/- Sd/- Sd/-
( Y. Siva Sagar Rao ) (P.K.Bishnoi) (P.Mohan Rao) (CA S.S.Bharadwaj)
Chairman-cum-Managing Director Director (Finance) Company Secretary
(Partner) - M.No.
26113
Place : New Delhi
Date : 10-06-2006
45
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2006
Rupees in
Crores
Schedule
For the year
ended For the year ended
No.
31st March,
2006
31st March,
2005
INCOME
Gross Sales 17
8482.4
4 8181.34
Less: Excise duty recovered on
sales
1176.7
3 821.50
Net Sales 7305.71 7359.84
Internal consumption 8.26 6.82
Interest earned 18 354.87 158.59
Other revenue 19 92.75 120.90
Total 7761.59 7646.15
EXPENDITURE
Raw materials consumed 20 3584.62 3019.63
Depletion/(Accretion) to Stock of Semi-finished/Finished goods
21 65.85 (310.39)
Employees remuneration &
benefits 22 572.34 490.25
Stores & spares consumed 338.95 313.46
Power & fuel 23 235.10 216.06
Repairs & maintenance 24 97.24 93.41
Contributions to Joint Plant Committee
funds 0.73 0.76
Freight outward 306.71 299.53
Other expenses & provisions 25 255.03 301.05
Interest & finance charges 26 31.06 11.11
Depreciation 415.57 424.19
Wealth tax 0.18 0.12
5903.38 4859.18
Less: Inter account adjustments-raw material mining cost 24.48 24.22
Net expenditure 5878.90 4834.96
Profit for the year 1882.69 2811.19
Prior period adjustments- Net
credit 27 6.82 1.44
Profit after Prior Period
Adjustments 1889.51 2812.63
Depreciation short provided in earlier
years 558.87
Profit before Tax 1889.51 2253.76
Provision for Taxation
Current Tax 474.97 87.18
Fringe Benefit Tax 3.94
Deferred Tax 158.23 158.49
Net Profit 1252.37 2008.09
Balance of (loss) brought forward from previous year (905.99) (2914.08)
Balance carried to Balance Sheet 346.38
(905.99
)
Basic and Diluted Earnings per Share (in Rupees)(Face Value Rs. 1000 per
share) 256.12 410.67
Accounting policies & Notes to
accounts 28
Schedules 1 to 28 annexed form part of the accounts
As per our separate report of even date
For RAO &
KUMAR
Chartered Accountants
Sd/- Sd/- Sd/- Sd/-
( Y. Siva Sagar Rao ) (P.K.Bishnoi) (P.Mohan Rao)
(CA
S.S.Bharadwaj)
Chairman-cum-Managing Director
Director
(Finance) Company Secretary (Partner) - M.No. 26113
Place : New Delhi
Date : 10-06-2006
46
SCHEDULES FORMING PART OF THE BALANCE SHEET AS AT 31st March , 2006
Schedule 01 : Share Capital
Rupees in Crores
As at As at
31st March, 2006 31st March, 2005
AUTHORISED
4,89,00,000 (Previous year 4,89,00,000) Equity shares
of Rs.1000 each 4890.00 4890.00
3,11,00,000 (Previous Year 3,11,00,000) Preference
Shares of Rs.1000
each 3110.00 3110.00
Total 8000.00 8000.00
ISSUED, SUBSCRIBED & PAID-
UP
4,88,98,462 (Previous year 4,88,98,462) Equity shares
of Rs.1000 each. 4889.85 4889.85
2,93,74,700 (Previous year 2,93,74,700) 7 % Non-
Cumulative redeemable Preference shares
of Rs.1000 each redeemable at par as under 2937.47 2937.47
10,00,000 during 2011-12
55,00,000 during 2014-
15
1,38,05,000 during 2012-13
30,00,000 during 2015-
16
60,69,700 during 2013-14
the earliest date of redemption is 31st March, 2012
Total 7827.32 7827.32
Of the above, 21,80,612 Equity Shares of Rs.1000 each were
allotted as fully paid-up for consideration other than cash.
Schedule 02 : Secured
loans
Rupees in
Crores
As
at As at
31st March,
2006
31st March,
2005
Cash Credit Accounts with
Banks 88.15 88.94
Secured by hypothecation of Raw materials, Semi-finished/
Finished goods, Stores & Spares, Book-debts and second
charge
on the Fixed assets to the extent of Rs. 2000 crores.
Total 88.15 88.94
Schedule 03 : Unsecured
loans
Rupees in
Crores
As
at As at
31st March,
2006
31st March,
2005
Short Term Foreign Currency
Loans 369.44 442.42
Total 369.44 442.42
4>
Schedule 04 : Fixed Assets
Rupees in
Crores
Gross Block
As at
31st Additions & Sales & As at 31st
March,
adjustment
s
adjustme
nts March
2005 during the
during
the 2006
year year
A
. Plant, Mines & Others :
Land-Freehold (Including cost of development) 41.41 -0.82 40.59
Land-Leasehold 1.65 1.65
Railway Lines & sidings 48.03 48.03
Roads, Bridges & Culverts 65.91 5.63 71.54
Buildings 732.61 0.71 733.32
Plant & Machinery 6951.23 62.58 10.89 7002.92
Furniture & Fittings 10.35 1.39 0.01 11.73
Locomotives 64.01 0.19 64.20
Vehicles 7.46 1.38 0.15 8.69
Electrical Installations 263.45 0.37 263.82
Water Supply & Sewerage systems 245.38 0.25 245.63
Miscellaneous Articles 70.83 7.18 0.23 77.78
Mining lease rights 5.83 5.83
Total (A) 8508.15 78.86 11.28 8575.73
Figures for the previous year 8455.16 57.36 4.37 8508.15
B. Social Facilities :
Land-Freehold ( Including cost of development) 10.30 10.30
Roads, Bridges & Culverts 11.94 11.94
Buildings 186.39 0.64 187.03
Plant & Machinery 2.07 2.07
Furniture & Fittings 0.17 0.17
Electrical Installations 18.64 0.09 18.73
Water Supply & Sewerage systems 18.51 0.03 18.54
Miscellaneous Articles 7.32 0.30 7.62
Total (B) 255.34 1.06 0.00 256.40
Figures for the previous year 254.56 0.77 -0.01 255.34
Total (A + B) 8763.49 79.92 11.28 8832.13
Figures for the previous year 8709.72 58.13 4.36 8763.49
4?
Schedule 04 : Fixed Assets
(continued) Rupees in Crores
Depreciatio
n
Net
Block
Up to 31st For the year Sales & Up to 31st
As at
31st As at 31st
March, ( incl. PPA)
adjustment
s March, March March,
2005 during 2006 2006 2005
the year
40.59 41.41
0.43 0.03 0.46 1.19 1.22
33.23 2.27 35.50 12.53 14.80
12.43 1.11 13.54 58.00 53.48
310.55 22.72 333.27 400.05 422.06
5459.85 362.48 -1.90 5824.23 1178.69 1491.38
7.19 0.87 8.06 3.67 3.16
41.95 3.05 45.00 19.20 22.06
6.95 0.17 0.15 6.97 1.72 0.51
172.33 12.39 184.72 79.10 91.12
166.22 11.39 177.61 68.02 79.16
38.68 7.86 0.22 46.32 31.46 32.15
1.37 0.28 1.65 4.18 4.46
6251.18 424.62 -1.53 6677.33 1898.40 2256.97
5272.00 982.28 3.10 6251.18 2256.97 3183.16
10.30 10.30
2.58 0.19 2.77 9.17 9.36
39.57 3.05 42.62 144.41 146.82
1.20 0.10 1.30 0.77 0.87
0.15 0.01 0.16 0.01 0.02
11.46 0.86 12.32 6.41 7.18
11.97 0.88 12.85 5.69 6.54
4.08 0.44 4.52 3.10 3.24
71.01 5.53 0.00 76.54 179.86 184.33
65.58 5.41 -0.01 71.00 184.34 188.98
6322.19 430.15 -1.53 6753.87 2078.26 2441.30
5337.58 987.69 3.09 6322.18 2441.31 3372.14
4A
ALLOCATION OF DEPRECIATION Rupees in Crores
As at As at
31st March ,
2006 31st March, 2005
Charged to Profit & Loss Account:
Current year 415.57 424.19
Prior periods 14.58 4.62
Short provided in earlier years -- 558.87
Total 430.15 987.68
Schedule 05 : Fixed Assets held for
disposal Rupees in Crores
As at As at
31st March ,
2006 31st March, 2005
Value of Fixed Assets 16.03 15.00
Less: Provision for loss 16.02 15.00
Estimated Net Realisable value 0.01 --
Schedule 06 : Capital Work-In-
Progress Rupees in Crores
As at As at
31st March ,
2006 31st March, 2005
Work-in-progress (Including Materials at
Site) 172.20 57.25
Less: Provision for Shortages 2.22 2.22 55.03
Advances to Contractors
0.
32
169.98
0.49
Less:Provision for doubtful advances
0.
00 0.20
0.32 0.29
Advances to Government departments 3.15 2.91
Advances to Suppliers 0.59 0.62
4.06 3.82
Expenditure during construction awaiting 6.69 --
allocation (Schedule : 07)
Total
180.7
3 58.85
Advances : Unsecured & Considered good 4.06 3.82
Advances : Unsecured considered doubtful 0.00 0.20
50
Annual Report 2005-
06
Schedule 07 : Expenditure during
Construction
Rupees in
Crores
As at As at
31st March , 2006 31st March, 2005
Expenditure duirng the year:
Employees Remuneration & Benefits 3.56 --
Other Expenses & Provisions 3.13 --
Total awaiting allocation carried to Schedule No.06 6.69 --
Schedule 08 : Investments* (At Cost) Rupees in Crores
As at As at
31st March ,
31st
March,
2006 2005
Trade - Quoted
1,82,927 Equity shares of Rs.10/- each in
Bisra Stone Lime Company Limited 0.00 0.00
Non-trade - unquoted
2,280 Equity shares of Re.1/- each in
Free Press House Limited 0.00 0.00
Total 0.00 0.00
* Investments amounted to Rs.3100/- and hence shown as zero Crores
1. Investments include one fully paid-up share of Rs.100/-
each in Anakapalli Rural Electric Co-operative socierty
Limited
2.Market value of quoted investments - not available.
5=
Schedule 09 : Inventories (As taken and certified by the Management)
Rupees in
Crores
As at
A
s
at
31st March ,
2006
31st March,
2005
Semi Finished/ Finished goods
at lower of cost or net realisable value
447.8
7
503.6
3
Add: In-transit 24.43 34.52
Raw materials at cost
501.8
9
472.30 454.9
0
538.15
Add: In-transit/ Under inspection 47.83
100.0
4
549.7
2
554.9
4
Less: Provision for shortages & damages 79.11
114.8
2
Stores & Spares at cost
294.7
2
470.61 290.8
3
440.12
Add: In-transit/ Under inspection 17.52 29.72
312.2
4
320.5
5
Less: Provision for obsolescence & Non-moving items 38.70 41.29
Total
273.54 279.26
1216.
45
1257.
53
Schedule 10 : Sundry debtors
Rupees in
Crores
As at
A
s
at
31st March ,
2006
31st March,
2005
Sundry debtors
Debts over six months 20.75 26.54
Other debts 164.27 43.04
185.0
2 69.58
Less : Prevision for doubtful debts 19.37 20.28
Total--Unsecured & considered good
165.6
5 49.30
Schedule 11 : Cash & Bank balances
Rupees in
Crores
As at
A
s
at
31st March ,
2006
31st March,
2005
Cash on hand 0.08 0.07
Cheques on hand 29.93 56.32
Remittances in-transit 0.06 0.04
Current Accounts with Scheduled Banks 170.14 38.16
Term deposits with Scheduled Banks 5421.49 3838.02
Total
5621.
70
3932.
61
Schedule 12 : Other Current assets
Rupees in
Crores
As at
A
s
at
31st March ,
2006
31st March,
2005
Interest accrued on loans to employees 1.90 2.34
Interest accrued -- others 182.35 97.63
Other income accrued 0.11 0.21
Total
184.3
6
100.1
8
52
Annual Report 2005-
06
Schedule 13 : Loans &
Advances
Rupees in
Crores
As at
A
s
at
31st March , 2006
31st March,
2005
Loan
s
Employees 2.72 1.41
Others 240.00 240.00
Material issued on loan 5.26 36.25
Advances & other recoverables
(Recoverable in cash or in kind or
for value to be received)
Government departments 14.94 6.07
Advance Income Tax & Fringe Benefit
Tax 506.91 174.24
Contractors 4.54 5.34
Less:Provision for doubtful
advances 0.54 0.44
4.00 4.90
Suppliers 52.63 85.78
advances 7.90 16.38
44.73 69.40
Employees 4.91 7.12
advances 0.16 4.75 0.19 6.93
Oth
ers 147.18 94.51
advances/ recoverables 14.67 13.37
132.51 81.14
707.84 342.68
Prepaid expenses 2.39 3.36
Claims recoverable 35.10 17.33
Less: Provision for doubtful claims 0.55 0.66
34.55 16.67
Depos
its 71.08 69.75
Total 1063.84 710.12
Loans : Secured & considered good 240.00 240.00
Loans
: Unsecured & considered
good 7.98 37.66
Advances : Unsecured & considered
good 707.84 342.68
Other
s
: Unsecured & considered
good 108.02 89.78
710.12
Advances : Unsecured considered
doubtful 23.27
1063.84
30.38
Claim
s
: Unsecured considered
doubtful 0.55 0.66
23.82 31.04
Total 1087.66 741.16
Amounts due from --
Directors 0.01 0.01
Maximum amount due at any time during the year from
--
Directors 0.01 0.01
5<
Schedule 14 :
Liabilities
Rupees in
Crores
As at
As
at
31st March ,
2006
31st March,
2005
Sundry creditors 275.04 218.39
Advances from customers 120.19 102.90
Other advances 1.60 4.64
Earnest money, security & other deposits 68.89 51.20
Interest accrued but not due 8.43 2.39
Other liabilities 397.34 332.94
Total 871.49 712.46
Schedule 15 : Provisions
for
Rupees in
Crores
Balance as
at Additions Total Payments /
Written
back
Balance as
at
31st
March, during the Utilisation / during the
31st
March,
2005 year Charged off year 2006
Gratuity to employees 88.61 35.13 123.74 3.49 -- 120.25
Future leave encashment 62.35 32.70 95.05 19.32 -- 75.73
Post-retirement Benefits 8.86 9.19 18.05 3.96 -- 14.09
Employee Family Benefit
Scheme 22.17 4.07 26.24 0.12 -- 26.12
Current Income Tax 87.18 474.97 562.15 87.18 -- 474.97
Fringe Benefit Tax -- 3.94 3.94 0.00 -- 3.94
Mines Closure -- 1.09 1.09 0.00 -- 1.09
Wealth Tax 0.10 0.18 0.28 0.18 (-) 0.08 0.18
Total
269.
27 561.27 830.54 114.25 (-) 0.08 716.37
Schedule 16 : Miscellaneous expenditure (To the extent not written-off or
adjusted)
Rupees in
Crores
As at 31st Additions Charged off As at 31st
Marc
h, during the during the March
2005 year year 2006
Deferred Revenue Expenditure 43.01 -- 18.14 24.87
Total 43.01 -- 18.14 24.87
Previous Year 61.45 -- 18.44 43.01
54
SCHEDULES FORMING PART OF THE PROFIT & LOSS ACCOUNT
FOR THE YEAR ENDED 31st March, 2006
Schedule 17 : Gross Sales
Rupees in Crores
Current
Previou
s
Year Year
Domestic 8039.88 7932.52
Export 442.56 248.82
Credited to : Profit & Loss Account 8482.44 8181.34
Schedule 18 : Interest earned Rupees in Crores
Current
Previou
s
Year Year
Loans to employees 0.20 0.13
Banks 307.48 127.03
Others 47.19 31.43
Schedule 19 : Other revenues Rupees in Crores
Current
Previou
s
Year Year
Rent recoveries 1.76 1.94
Profit on sale of fixed assets 1.15 19.92
Provision no longer required written back 9.07 51.12
Liquidated damages 1.25 0.37
Claims for finished goods (Shortages & Missing Wagons) 1.57 1.06
Export benefits 24.43 11.29
Sale of power 8.44 9.10
Net income from other operations 0.64 1.13
Exchange Rate Variation 0.54 --
Sundry receipts 43.90 24.97
55
Schedule 20 : Raw materials consumed
Quantity:
Tonnes
Value :
Rupees in
Crores
Current Year Previous Year
Quanti
ty Value
Qua
ntity Value
Coal
332150
6 1757.46 3206985 1225.52
Coke and Coke breeze
32197
6 364.43 443409 777.04
Iron Ore
634356
9 1077.63 6071994 658.88
Sponge Iron 10102 12.44 -- --
Iron Ore Pallets 27395 19.17 -- --
Limestone
88661
2 89.46 794393 88.46
Dolomite
74085
0 52.42 737559 50.20
Silico Manganese 36947 109.71 35071 119.14
Ferro Silicon 7153 28.40 7227 26.55
Alluminium 3842 41.16 3616 35.27
Manganese Ore 16147 1.47 16456 1.11
Petroleum Coke 5683 7.12 6217 7.43
Sea Water Magnesite 3537 9.47 5396 13.41
Others 14.28 16.61
Total
3584.6
2
3019.6
3
Schedule 21 : Depletion/(Accretion) to Stock of Semi-Finished / Finished
goods
Rupees in
Crores
Current
Year
Previous
Year
Opening stock 538.15 227.76
Less: Closing stock 472.30 538.15
Net Depletion/(Accretion) transferred to Profit & Loss
Account 65.85
(310.39
)
Schedule 22 : Employees remuneration &
benefits
Rupees in
Crores
Current
Year
Previous
Year
Salaries, wages & allowances 455.71 404.46
Company's contribution - provident fund & other funds 33.86 31.13
Staff welfare expenses 51.75 42.46
Gratuity 35.13 12.20
Voluntary Retirement Benefits 0.55 0.00
Total 577.00 490.25
Less: Transferred to Capital Work in Progress 1.10 --
575.90 490.25
Charged to : Profit & Loss Account 572.34 490.25
Expenditure during Construction 3.56 --
Total 575.90 490.25
56
Schedule 23 : Power & fuel
Rupees in
Crores
Current
Year
Previous
Year
Purchased power 58.61 53.04
Boiler coal 174.90 162.06
Furnace oil/ LSHS/ LDO 1.59 0.96
Charged to : Profit & Loss Account 235.10
216.0
6
Schedule 24 : Repairs & Maintenance
Rupees in
Crores
Current
Year
Previous
Year
Plant & Machinery 56.14 58.21
Buildings 8.43 7.93
Others 32.67 27.27
Schedule 25 : Other expenses & provisions
Rupees in
Crores
Current
Year
Previous
Year
Technical services 2.91 0.58
Rent 2.69 2.56
Rates & taxes 2.69 2.72
Excise Duty (24.27) 72.46
Insurance 3.66 3.91
Handling & scrap recovery 92.77 84.28
Selling expenses 16.69 11.24
Travelling expenses 38.52 24.52
Printing & stationery 2.47 1.86
Postage, telegrams & telephone 3.16 2.96
Water charges 25.92 9.97
Legal expenses 0.56 0.40
Bank charges 1.69 3.42
Security expenses 15.85 14.77
Advertisement 10.81 7.30
Demurrages & wharfages 7.63 0.12
Auditors' Remuneration- Statutory Audit 0.04 0.04
Auditors' remuneration-Tax matters 0.02 0.01
Auditors' travelling & other expenses 0.09 0.06
Provision for shortage/damaged material/obsolescence/non-moving items of
stores 7.17 3.61
Provision for doubtful advances and claims 5.88 8.88
Provision for doubtful debts 0.70 0.32
Loss on Fixed Assets held for disposal written off / provided for 0.55 --
Exchange Rate variation -- 4.55
Miscellaneous & deferred revenue expenditure written Off 18.14 18.44
Sundries 21.89 22.07
258.23 301.05
Less : Transferred to Capital Work in Progress 0.07 --
Total 258.16
301.0
5
Expenditure During Construction 3.13 --
Total 258.16
301.0
5
5>
Schedule 26 : Interest & finance charges
Rupees in
Crores
Current Year
Previous
Years
Interest : 26.6
4 Foreign currency loans/suppliers' credit 9.28
Banks - Cash Credit 2.13 1.56
Interest on Income Tax 1.89 --
Others 0.40 0.18
31.06 11.02
Finance Charges 0.00 0.09
Schedule 27 : Prior period adjustments
Rupees in
Crores
Current Year
Previous
Year
Excise 0.00 0.26
C
R
Claims for finished goods 0.00 0.10
D
R
Raw materials consumed 0.00 6.50
C
R
Stores & spares
23.0
6 CR 0.36
D
R
Interest & finance charges 0.00 0.13
C
R
Depreciation
14.5
8 DR 4.62
D
R
Other Expenses 2.86 DR 0.37
D
R
Other Revenue 1.20 CR 0.00
Credited to : Profit & Loss Account 6.82 CR 1.44
C
R
5?
Schedule 28: Accounting Policies & Notes on Accounts
1. SIGNIFICANT ACCOUNTING POLICIES
1. GENERAL
Financial statements are prepared on going concern basis under the historical cost convention, adopting
accrual method of accounting and in accordance with the generally accepted Accounting Principles.
2. FIXED ASSETS AND INTANGIBLE ASSETS
1. Fixed assets are stated at cost less accumulated depreciation. Cost of acquisition of fixed assets is inclusive
of freight, duties ( net of CENVAT/VAT), taxes, incidental expenses relating to the cost of acquisition, allocated
Expenditure during construction (which comprises of expenses less incomes attributable to the construction
activities), borrowing costs and cost of installation / erection as applicable.
2. Net gain/loss arising on disposal/discarding of fixed assets is treated as revenue.
3. Contributions made by the company towards the cost of fixed assets owned by the State/Central
Government are grouped together with similar assets owned by the company with appropriate
disclosure thereof.
4. Pending ascertainment of actual amount to be capitalised to fixed assets, capitalisation is made initially
on provisional basis. Adjustments to cost and depreciation are made on ascertainment of actual cost of
the respective assets.
5. Expenditure on fixed assets is capitalised at the following points of time:
9) In case of Plant & Machinery, when the respective sub-units are fit for commercial production. A
sub-unit is considered to be fit for commercial production at the later of the following:
1) from the end of 3 months from the commissioning date, provided such unit is capable of
producing at 50% rated capacity.
2) from the end of calender month in which the plant unit produces/becomes capable of producing
atleast 50% of the rated capacity.
2) In case of land, when the possession is taken/expenditure is incurred on development.
3) In case of other assets, when they are put to use.
4) Factory buildings are capitalised alongwith the Plant housed in the buildings.
6. Machinery spares identified with production/service units, whose use is expected to be irregular, but
non-availability of which affects the production / service units are categorised as 'Risk Insurance
Spares'. The cost of such items is depreciated over the useful life of the Principal plant unit.
7. Intangible assets are recorded at cost.
3. DEPRECIATION AND AMORTISATION
9) Depreciation is provided on straight line method (SLM), in accordance with the provisions of Schedule
XIV of the Companies Act, 1956, except the following:
1) Depreciation on Coke ovens & Coal chemical plant units is provided on SLM at 6.33% based on the
Management's estimate of the useful life of the Plant; and
5A
b) Depreciation on the following categories of assets are provided on SLM at the rates mentioned against
each based on the Management's estimate of the useful life of such assets.
Categories of Assets
Depreciation Rate
(%)
Photo Copiers & Fax Machines 19.00
Other Office Equipments 13.57
Air Conditioners 13.57
Cranes 9.50
Earth Moving Equipments 13.57
Slag Pot Carriers 9.50
Safety Equipments 11.87
Cars 15.83
Other light vehicles 11.87
Computers (including system software) 23.75
3) Contributions made by the company towards the cost of fixed assets owned by the State/Central
Government are depreciated over the estimated period of their utility or five years whichever is less.
2) Mining lease rights are amortised over the period of lease.
3) Intangible assets are amortised over their estimated useful lives.
4. INVENTORIES:
1) (i) Finished/ Semi-finished goods are valued at lower of cost (excluding interest and administrative
expenses but including all other costs incurred in bringing the inventories to their present location
and condition) or net realisable value. Cost of production is the average cost of production of the
last six months during the year considering normal capacity. Normal capacity is based on the
average production of the preceding three years of main production units, excluding abnormal
years. Abnormal year is the year in which the actual production is less than 40% of the installed
capacity. Coke and other By-products are valued at net realisable value wherever cost is not
determined except in the case of stock of BF granulated slag at dump yard for which no value is
assigned. Products which are meant for internal consumption, for further production, but not for sale
are valued at cost. No credit is taken for the value of material in process except those lying at mills.
(2) Finished/Semi-finished goods transferred for construction/maintenance and included in the stock of
stores & spares are valued at cost.
(3) Iron scrap and Steel scrap are valued at 75% and 90% respectively of the cost of pig iron or of the
domestic net realisable value of Pig Iron, whichever is less.
2) (i) Raw materials and spares imported during the year are valued at landed cost inclusive of import duty
benefits availed. Liability to the extent of unfulfilled export obligations at the end of the year is
provided for.
(2) No credit is taken in the accounts for the stock of run of mines ore and rejects at Mines.
3) (i) Raw materials, stores, spares, loose tools, materials in transit are valued at cost. In the event of net
realisable value of finished steel products being less than the cost of production, raw materials are
valued at lower of cost and net realisable value.
(2) Loss on account of obsolescence of stores & spares is charged to revenue.
(3) Non-moving items of stores & spares are recognised at 80% of their cost.
(4) Stock of spares acquired along with the related equipments, not having item-wise breakup of cost,
are valued at average cost.
60
(5) For all the above, cost is determined on monthly weighted average basis unless otherwise specified.
5. INVESTMENTS:
Investments are stated at cost. Income from investments is accounted for on accrual basis.
6. SALES:
Gross Sales are inclusive of excise duty and contributions to various funds and are net of discounts and
rebates.
1) Domestic sales on F.O.R. destination basis are accounted for when goods are delivered to the carriers.
2) Exports sales are recognised in the following manner:
1) Sea Exports, Road Exports and Rail Exports are recognised on the date of Bill of Lading, the Date
of Road Consignment Note and Date of Railway Receipt respectively.
2) in cases where 'realisation of material value without shipment' is provided for in the Letters of Credit
of respective contracts, on expiry of laydays given in notice of readiness of cargo or the laydays
otherwise accepted by the seller or on expiry of 15 days from notice of readiness of cargo
whichever is earlier.
7. EXPORT BENEFITS:
Export benefits are accounted as follows:
1) Import duty benefits availed by way of duty exemption / remission licenses under Export Import Policy
earned on exports are accounted as income under the head 'Export benefits'.
2) DEPB/DFRC or any other Export Incentive credits sold or contracted /identified for sale are accounted
on realisable value.
3) The valid Licences under duty exemption / remission schemes under Export Import Policy, sanctioned till
the date of finalisation of the accounts are accounted as 'Export benefits', to the extent of export
obligations fulfilled up to the end of the year.
8. EXCISE & CUSTOMS DUTIES:
1) Excise duty liability on finished goods is accounted for on the basis of actual production.
2) Customs duty on imports is accounted provisionally, pending completion of final assessment.
9. EMPLOYEES' BENEFITS :
1) The provisions towards Employees Benefits such as gratuity, accrued leave, post-retirement medical
and settlement benefits to employees, future payments to the disabled employees/legal heirs of
deceased employees under the Employees' Family Benefit Scheme are made based on the actuarial
valuation as at the end of the year.
2) Compensation under Voluntary Retirement Scheme is expensed in the year in which it is incurred.
10. RESEARCH & DEVELOPMENT EXPENDITURE :
Research & Development expenditure is accounted under the primary heads of account and charged to P&L
account. Capital expenditure on Research & Development is included in the fixed assets.
11. MISCELLANEOUS EXPENDITURE:
In line with AS 26, expenditure incurred and treated as Deferred revenue expenditure before 1.4.2003 is
written off over a period of five years from the year of commencement of production/ year of initial incurring
of expenditure, as the case may be except in the case of (i) expenditure on Blast Furnace relining which is
written off over a period of eight years; and (ii) expenditure on cold repairs of Coke Oven batteries which is
written off over a period of five years commencing from the year in which the units restarted production.
6=
12. FOREIGN CURRENCY TRANSACTIONS :
(1) Foreign currency monetary items are translated at the rate of exchange prevailing as on the Balance
Sheet date.
(2) Net loss/gains arising on account of settlement/conversion of foreign currency monetary items is dealt
with in the following manner:
1) in respect of liabilities incurred to acquire fixed assets, regarded as adjustment of cost and are included
in the carrying amount of the related fixed assets. However, in respect of liabilities incurred to acquire
fixed assets within India, the net loss or gain arising out of foreign currency transactions entered into on
or after 1.4.2004 is recognized as expense or income in the period in which they arise.
2) in respect of current assets/liabilities, recognised as expense or income in the period in which they
arise. However, where forward cover exists, the premium or discount arising at the inception of
forward exchange contract is amortised as expense or income over the life of the contract.
Exchange differences on such contracts are recognized in the profit and loss account in the
reporting period in which the exchange rates change. Profit or loss on cancellation or renewal of
such contracts is recognized as income or expense for the period.
13. PRIOR PERIOD ADJUSTMENTS:
Items of Income/ Expenditure which arise in the current period as a result of errors or omissions in the
preparation of Financial statements of one or more prior periods exceeding Rs.5,00,000 in value in each
case are treated as prior period adjustments.
14. BORROWING COSTS:
(1) Borrowing costs incurred for obtaining assets which take more than 12 months to get ready for its
intended use are capitalised to the respective assets:
1) wherever the costs are directly attributable to such assets; and
2) in other cases by applying weighted average cost of borrowings to the expenditure on such assets.
(2) Other borrowing costs are treated as expense for the year.
15. EXPENDITURE DURING CONSTRUCTION (EDC):
Expenditure , including that proportion of Employees' Remuneration and benefits, attributable / relating to
Expansion activity, to the extent not directly identifiable to any specific Plant Unit, is kept under Expenditure
During Construction for allocation to Fixed Assets and is grouped under Capital Work-in- Progress.
16. TAXES ON INCOME:
Provision for income tax comprises of current tax and deferred tax. Deferred tax is recognised on timing
differences, being the differences between taxable and accounting income/expenditure that originate in one period
and are capable of reversal in one or more subsequent period(s), subject to consideration of prudence.
17. CLAIMS:
1) Claims for liquidated damages against the suppliers/contractors are accounted for when the amounts
are actually recovered.
2) Claims for escalation by Contractors and Suppliers are accounted on acceptance by the Company.
3) Claims on Railways are accounted for when they are lodged.
4) Claims lodged under various insurance policies, risk purchases, price subsidy & freight subsidy on
Ammonium Sulphate and the interest receivable from Sundry Debtors for delayed payments/banks for
delayed credits for Telegraphic transfers are accounted on certainty of realisation.
62
Schedule 28 Contd...
2. NOTES FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 31st March, 2006.
1. Land acquired at the cost of Rs. 39.99 Crores (previous year Rs.40.81 Crores) is being held in the name of
President of India. The Company is holding Power of Attorney issued by Govt. of India for utilisation of the
land acquired for the Project and related purposes incidental thereto.
2. Sale deeds in respect of the following assets are yet to be executed:
a) Stockyard at Chennai Rs.
1.51
Crores
(Previous year Rs. 1.51
Crores)
b) Office buildings at New Delhi Rs.
1.19
Crores
Crores)
c) Office buildings at Ahmedabad Rs.
0.18
Crores
Crores)
d) Residential buildings at Kolkata Rs. 1 Crore
Crores)
3. Land includes 342.1971 acres ( Previous year Rs.341.9771 acres) allotted to various agencies on lease basis.
4. a) Fixed Assets ( Gross Block) include assets costing Rs.10.05 Crores (previous year Rs.10.05 Crores) not owned by the Company
which were depreciated in full as per the accounting policy 3( i ) c.
2) Fixed Assets include Rs.0.17 Crores ( Credit )[ previous year Rs.0.21 Crores(Debit) ] being the Exchange Rate
Variation for the year in respect of foreign currency liabilities incurred to acquire fixed assets prior to 1st April 2004.
5. Main plant units, including Mills, are treated as Continuous Process Plant.
6
. a) Sundry Creditors comprise of
Rupees in
Crores
As on 31st As on 31st
March,
2006 March, 2005
i
) Total outstanding dues to Small Scale Industrial Undertakings* 14.41 14.42
ii) Total outstanding dues to creditors other than Small Scale Industrial
Undertakings 260.63 203.97
2) There is no Small Scale Industrial Undertakings to whom, a sum exceeding Rs. 1 lakh is owed which is
outstanding for more than 30 days.
1* Identification of 'Small Scale Industrial Undertakings' is made on the basis of and to the extent of information is
available.
7. Adjustments have been made to the extent reconciliation of Priced stores ledger with Bin cards is completed.
8. Housing/ Vehicle Loans to employees are reckoned as unsecured and considered good.
9. Loans and advances, Sundry debtors / Creditors, Stock with some Consignment agents are subject to reconciliation/confirmation.
10. Quantities of Closing Stock of finished / semi-finished goods have been adopted as per physical verification /
custodians' certificate except in the case of Calcined Lime, Liquid Oxygen, Liquid Nitrogen, Argon gas,
Oxygen gas, Nitrogen gas, Dolomite magnesite bricks, Calcium carbide sludge and Stocks at New Steel
Yard amounting to Rs.19.94 Crores ( Previous Year Rs 15.05 Crores ) which are as per book balances.
11. (a) The stock of iron scrap and steel scrap has been considered in the accounts on the basis of visual survey/estimates.
(2)In the absence of Sale of Coke Breeze, the same has been valued at 60% of the production cost of BF coke.
12. Power & fuel does not include the cost of generation of power and production of certain fuel elements in the Plant
which are internally consumed. The related expenses have been included under the primary heads of account.
13. Materials issued for use as 'Dunnage', were capitalised during the year with effect from the respective years. As a result,
the Gross and Net blocks of Fixed Assets have increased by Rs. 3.35 crores and Rs. 2.45 crores respectively and
Depletion/(Accretion) to Stock of Semi-Finished/Finished goods and Internal Consumption are higher by Rs. 4.02 crores
and Rs. 3.35 crores respectively. As a net result, the Net Profit is lower by Rs. 1.57 crores.
6<
14. Earning Per Share (EPS)
2005-06 2004-05
i ) Net Profit
(Rupees
Crores) 1252.37 2008.09
ii )
Weighted average number of Equity Shares outstanding during the
year
(No.of
shares) 48898462
4889846
2
iii) Face value per share (Rupees) 1000 1000
iii) Basic and diluted EPS (Rupees) 256.12 410.67
15. The Company's business is construed as one business segment which comprises of mainly production of
steel products, whose associated risks and returns are predominantly the same. Further, the Company has
no geographical segments which are subject to different risks and returns. Hence no separate disclosure in
terms of Accounting Standard-17 on segment reporting is considered necessary.
16. The lease transactions of the Company, being only incidental to the Company's main business of production &
sale of Iron & Steel products, we are of the view that the Accounting Standard AS-19 on Leases is inapplicable.
17. Income tax (MAT) liability under Section 115JB of the Income Tax Act, 1961, for the financial years 2003-04 and 2004-05, was
determined on the basis of the expert opinion of Tax Consultants considering the issue of adjustment of unabsorbed
depreciation / accumulated losses. To avoid possible dispute / litigation with the Income Tax department, an application has
been filed before the Hon'ble Authority for Advance Ruling for determination of the above issue. If the Company's stand is not
accepted, the additional liability towards income tax would be Rs.97.33 Crores (previous year Rs.97.33 Crores).
18. In compliance with Accounting Standard -22 on 'Accounting for Taxes on Income' issued by The Institute of Chartered
Accountants of India, the Net Deferred tax liability of Rs. 316.72 Crores (Previous Year Rs.158.49 Crores) has been
provided during the current year. Components of Deferred Tax Liabilities and Deferred Tax Assets are as under:
Rupees in Crores
Particulars
As at
31st As at 31st
March,
2006 March, 2005
Deferred Tax Liabilities
Difference between book and tax depreciation 421.66 519.94
Deferred Revenue Expenditure 8.37 14.48
Sub-
Total
(A
) 430.03 534.42
Deferred Tax Assets
Unabsorbed depreciation under Income Tax Act,
1961 0.00 276.49
Provision for Gratuity 40.48 29.83
Provision for doubtful debts,advances &
Claims 14.54 17.34
Other Deferred Tax Assets 58.29 52.27
Sub-
Total
(B
) 113.31 375.93
Net Deferred tax Liability / (Asset)
(
A
)
-
(B) 316.72 158.49
19. The entire plant has been considered as a Cash Generating Unit. As Recoverable amount of the Cash
Generating Unit, being its value in use, is in excess of its carrying amount, there is no impairment loss in
terms of the Accounting Standard (AS)-28 Impairment of assets.
20. As per section 441A of the Companies Act 1956, cess on turnover is leviable. Government of India has not
yet framed any rules/ guidelines in this regard and hence no amount has been provided and/or paid.
64
Rupees in Crores
As at 31st As at 31st
March, 2006 March, 2005
21. Estimated amount of contracts remaining to be executed
on capital account and not provided for (net of advances)
439.0
4 95.15
2
2. Contingent liabilities not provided for:
Rupees in
Crores
a)
Claims against the
Company Claims pending judicial
not acknowledged as
debts decisions
As at 31st As at 31st As at 31st As at 31st
March,
2006
March,
2005 March, 2006 March, 2005
Contractors/ Suppliers/ customers 64.65 64.36 146.47 188.69
Local Authorities - State Govt. 2.20 0.48 -- 0.28
Sales Tax matters -- -- 17.52 19.64
Customs/ Excise duty -- -- 33.98 35.47
R & D Cess 13.18 13.18 -- --
b)
Claims in Courts in connection with Land
Acquisition:
Amount not
ascertainable.
3) Liability towards reimbursement of excise duty on structural works wherever applicable. Amount not ascertainable.
4) Amounts paid under protest of Rs.19.44 Crores, Rs.12.19 Crores, Rs. NIL Crores and Rs. 2.93 Crores
(Previous year Rs. 29.86 Crores, Rs.12.24 Crores, Rs. 4.98 Crores and Rs 2.93 Crores ) towards disputed
demands of income tax on foreign suppliers & TDS, sales tax, excise duty and customs duty respectively are
included under ''Advance recoverable" for which no liability has been created.
23. Previous years figures have been regrouped and reclassified wherever necessary.
2
4
. Stocks & Sales Quantity in Tonnes
Value - Rupees in
Crores
Pig
Iron Blooms Saleable Sundries Total
Steel
Coke &
Coke Others
Products
Opening
stock- Quantity 30312 58355 173831 159101 -- --
(3178) (27762) (123526) (32295) -- --
Value 31.33 79.12 284.02 89.13 54.55 538.15
(2.39) (26.28) (143.98) (14.30) (40.82) (227.77)
Sales- Quantity 410804 134303 3146759 -- 1204047 --
(22965
4)
(142081
)
(296841
0) (5632)
(144932
3) --
Value 543.43 256.88 7470.67 -- 211.46 8482.44
(344.42
) (301.11)
(7366.00
) (1.75) (168.06)
(8181.3
4)
Closing
stock- Quantity 27750 45095 109687 143193 -- --
(30312
) (58355) (173831) (159101) -- --
Value 30.57 70.82 202.23 92.46 76.22 472.30
(31.33) (79.12) (284.02) (89.13) (54.55) (538.15)
Note: Figures in brackets are for previous
year.
Closing stock includes 19484 tonnes (Previous year 53400 tonnes) in the custody of consignment
agents.
Figures of closing stock are after adjustment for internal consumption, transfers to capital works,
shortages/excesses.
Others include By-products and Iron & Steel
Scrap.
65
25. Value of raw materials etc and stores/spares components consumed:
Current year Previous Year
Raw Materials Stores & Spares
Raw
Materials
Stores &
Spares
Rupees
Percen
- Rupees
Perce
n- Rupees
Percen
-
Rupee
s
Perce
n-
in
Crores tage
in
Crores tage
in
Crores tage
in
Crores tage
(
a
) Indigenous 1792.97 50.02 297.43 87.75 1316.43 43.60 261.08 83.29
(
b
) Imported 1791.65 49.98 41.52 12.25 1703.20 56.40 52.38 16.71
Total 3584.62 100.00 338.95
100.0
0 3019.63 100.00 313.46 100.00
Rupees in Crores
Curren
t
Previo
us
year Year
26. Expenditure in foreign currency (cash basis)
(a) Technical consultation fee/know-how 0.01 0.31
(b) Interest 21.83 7.38
(c) Others 2.08 4.82
27. Earnings in foreign exchange (cash basis)
(a) Export of goods (on FOB basis) 442.65 249.22
(b) Others 0.87 10.05
Rupees in
Crores
Current Previous
year Year
28. Value of imports during the year calculated on CIF basis
(a) Spares 37.04 41.03
(b) Raw materials 1734.93 1692.41
(c) Capital Goods -- 1.50
Rupees in
Crores
Current Previous
year Year
29. Particulars of Directors remuneration
(a) Salaries & allowances * 0.30 0.52
(b) Companys contribution to provident fund 0.04 0.04
(c) Leave travel concession 0.00 0.01
(d) Medical reimbursement 0.01 0.00
(e) Gratuity 0.07 0.10
Total 0.42 0.67
* includes wage arrears of Rs. NIL Crore ( Previous year Rs. 0.13 Crores ).
66
3
0.
Licensed capacity, installed capacity & actual
production
( Tonnes in
000s)
Current
Year
Previous
Year
*License
d Installed Actual
*License
d
Install
ed Actual
Capacit
y Capacity
Productio
n Capacity
Capac
ity Production
Product:
(
a
) Wire Rods 850 1043 850 1014
(
b
)
Light & Medium Merchant Products-Bar
Mill 710 873 710 858
(
c
) Saleable Billets 246 110 246 137
(
d
) Medium Merchant Structural Mill 850 1058 850 1014
Total 2656 3084 2656 3023
(
e
) Pig Iron 556 439 556 273
(
f
) Granulated Slag 1440 1578 1440 1514
(
g
) Coke Ovens By-products 186 152 186 145
Note: *Licensed capacity not applicable in terms of Government of India notification No. S.O.477(E), dated 25th July, 1991.
31
. Expenditure on public relations Rupees in Crores
Current Previous
year Year
(a) Employees remuneration & benefits 0.71 0.62
(b) Expenditure on institutional publicity 2.92 2.10
Total 3.63 2.72
Cash Flow Statement
32
. Rupees in Crores
Current Previous
year Year
1. Cash flow from Operating activities
Net Profit before interest & tax 1565.70 2106.15
Adjustments for:
Add: Depreciation ( including Prior Period Depreciation ) 430.15 987.69
Add:
Miscellaneous & deferred revenue expenditure written
Off 18.14 18.44
Less:
Adjustments on accounts of discard\removal of
assets -1.54
Less: Profit on sale of fixed assets 1.15 19.92
Operating Profit 2014.38 3092.36
Less: Adjustments for
Inventories -41.08 551.19
Sundry debtors 116.35 -36.32
6>
s
h

e
q
u
i
v
a
l
e
n
t
s
(Re
pre
sen
ted
by
Ca
sh
&
Ba
nk
Bal
anc
es -
Sc
hed
ule
11
)
-0.10
21.05
-152.99
-55.37
2126.52
442.05
1684.47
168.34
1.16
270.59
-103.41
0.79 -51.77
72.98 -183.94
25.02 9.73
98.79 -225.98
1689.09 2572.90
3932.61 1359.71
5621.70 3932.61
6?
33. Balance Sheet Abstract and Companys General Business Profile
I. Registration Details
Registration No. State Code : 0 1 3 4 0 4 0 1
Balance Sheet Date 3 1 0 3 2 0 0 6
D
at
e
Mo
nth
Ye
ar
35. Capital raised during the Year (Amount in Rs. Lakhs)
Public
Issue
Rights
Issue
N I L N I L
Bonus
Issue Private Placement
III. Position of Mobilisation and
N I L
Rs. Lakhs)
N I L
Deployment of Funds (Amount
in
Total
Liabilities Total Assets
1 0 5 3 5 8 7 1 0 5 3 5 8 7
Sources of Funds
Paid-
up
Cap
ital
Reserve
s
&
Surpl
us
7 8 2 7 3 2 3 4 6 3 8
Secured
Loans
Unsecured
Loans
8 8 1 5 3 6 9 4 4
Application of
Funds
Net Fixed
Assets
Investment
s
2 2 5 9 0 0 0
Net Current Assets Miscellaneous Expenditure
6 6 6 4 1 4 2 4 8 7
Accumulated
Loss
N I L
IV. Performance of Company (Amount in Rs. Lakhs)
Turno
ver
Total
Expenditure
7 7 6 1 5 9 5 8 7 2 0 8
Profit/Loss Before
Tax Profit/Loss After Tax
1 8 8 9 5 1 1 2 5 2 3 7
Earnings per Share in
Rs.
Dividend
(%)
2 5 6 N I L
22. Generic names of Three principal Products/ Services of Company (As per Monetary Terms)
Item Code No. (ITC Code) 7 2 1 3 9 1 0 9
Product Description W I R E R O D
Product Description P I G I R O N
Product Description R E B A R S
6A
Annexure - I
A9)I3/R+, R2'/R3
To the Members of Rashtriya Ispat Nigam Limited
1. We have audited the attached Balance Sheet of Rashtriya Ispat Nigam Limited, as at 31st March 2006, and also the Profit and
Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These
financial statements are the responsibility of the Companys Management. Our responsibility is to express
an opinion on these financial statements based on our audit.
2. We conducted our audit in accourdance with the auditing standards generally accepted in India. Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financail statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial statement
prsentation. We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditors report) Order, 2003, issued by the Central Government of India in
terms of Sub-section (4A) of Secction 227 of the Companies Act, 1956, and on the basis of such checks as
we consider appropriate and according to the information and explanations given to us, we enclose in the
annexure a statement on the matters specified in paragraph 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that :
(1) We have obtained all the information and the explanations, which to the best of our knowledge and
belief were necessary for the purpose of our audit;
(2) In our opinion, proper books of accounts as required by law have been kept by the company so far
as appears from our examination of those books and proper returns adequate for the purposes of
our audit have been received from the branches not visited by us;
(3) The Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by this report
are in agreement with the books of account and with the returns from the branches;
(4) In our opinion, the Balance sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report,
comply with Accounting Standards referred to in sub - Section (3C) of Section 211 of the Companies Act, 1956;
(5) The provisions of section 274(1)(g) are inapplicable to Government Companies vide Notification
No. G.S.R. 829 (E) dated 21-10-2003 as declared by the Central Government;
(6) With regard to the Cess payable under section 441A, the company, vide note 21 in Schedule 26 to the Accounts,
had neither provided nor paid any amount, as the Government o f India had not framed any rules/guidelines in
this regard.
(7) In our opinion and to the best of our information and according to the explanations given to us, the said accounts,
subject to and read together with the Significant Accounting Policies and Notes forming
part of accounts given by way of Schedule 28 to the Accounts, give the information required
by the Companies Act, 1956, in the manner so required and give a true and fair view, inconformity
with the accounting principles generally accepted in India;
(1) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2006;
(2) In the case of the Profit and Loss Account of the PROFIT for the year ended on that date; and
(3) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
Place : New Delhi For Rao & Kumar
Date : 10-06-2006 Sd/-
S.S. Bharadwaj
Partner
Chartered Accountant
Membership Number :
26113
>0
ANNEXURE TO AUDITORS REPORT
Referred to in paragraph 3 of our Report of even date
1. Fixed Assets
(1) The Company has maintained proper records showing full particulars including quantative details
of fixed assests, except for historical cost figures in certain cases.
(2) All assets have not been physically verified by the management during the year but there is a regular
programme of verification which in our opinion is reasonable having regard to the size of the company
and the nature of its assets. No material discrepancies were noticed on such verification.
(3) No substantial part of fixed assets of the company has been disposed off during the year.
2. Physical verification and reconciliation of Inventories
(1) Inventories have been physically verified during the year by the management, except stocks with conversion agents/
custodians and with outside agencies and those referred to in Note No. 10 to the Notes on Accounts, which are
adopted based on the book value amounting to Rs. 19.94 crores out of the total reported stock of Rs. 1216.46
crores. In respect of stores and spares, company has a regular program of verification in a phased manner,
which in our opinion, is adequate and reasonable having regard to the nature and location of stocks.
(2) The procedures for physical verification of inventory followed by the management are reasonable
and adequate in relation to the size of the company and the nature of its business.
(3) Reconciliation between Priced Stores Ledger and Bin Card in respect of Stores and spares was continued during
the
year. Adjustment has been carried out to the extent reconciliation
was
completed. Reconciliation is pending in
respect
of stores and spares whose value and impact of adjustments pending is
not
ascertainable
.
3
.
Loa
ns and Advances to parties covered in register maintained under section 301
of
the Act.
The Company had neither granted nor taken any loans, secured or unsecured, to/from companies firms or other parties covered in
the register maintained under Section 301 of the Act. In view of this clauses (b), (c) and (d) of paragraph 4(iii) are inapplicable
4. Internal Control procedure
In our opinion and according to the information and explanations given to us, having regard to the explanation that
some of the items purchased are of special nature and suitable alternative sources do not exist for obtaining
compatible quotations, there are adequate internal control procedures commensurate with the size of the company
and the nature of its business with regards to purchase of inventory, fixed assets and with regard to the sale of goods.
5. Transactions to be entered into Register manitained under Section 301 of the Act,
According to the information and explanations given to us, there are no transactions that need to be
entered into the register maintained under section 301 of the Companies Act, 1956. As there are no such
transactions, clause (b) of paragraph 4(v) is inapplicable.
6. Acceptance of Deposits from Public
The Company had not accepted any deposits from the public. As such, the directives issued by the Reserve Bank of
India and the provisions of Section 58A & 58AA of the Act and the rules framed there under are inapplicable.
7. Internal Audit System
In our opinion, the company has an Internal Audit system commensurate with the size and nature of its business.
>=
8. Maintenance of Cost Records
We have broadly reviewed the books of account maintained by the company pursuant to the rules made by the Central Government
for the maintenance of Cost Records under Section 209(1)(d) of the Companies Act, 1956 and we are of the opinion that prima-facie
the prescribed accounts and records have been made and maintained in respect of the applicable products. With respect to Power
Generation, Government of India notified Cost Audit for the year under audit. We are informed that compilation in the formats under
Cost Accounting Records is in progress. As such we could not verify the relevant records. We have however not made a detailed
examination of the records with a view to determine whether they are accurate and complete.
9. Payments and remittances to Statutory Authorities
(1) According to the records of the Company, the company has been regular in depositing with appropriate authorities,
undisputed statutory dues including Provident Fund, Income Tax, Sales Tax, Wealth Tax, Customs Duty, Excise
Duty, Cess and other material Statutory dues applicable to it.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income
Tax, Wealth Tax, Sales Tax, Customs Duty, Excise Duty and Cess were in arrears as at 31st March 2006, for a
period of more than six months from the date they became payable.
(3) According to the explanations given to us, Company is not required to make any contribution under
the Employees State Insurance Act.
(d)
According to the information and
explanations
given to us, as at the end of the
financial
year the disputed
dues
of Income Tax, Sales Tax, Customs Duty, Excise Duty and Cess which have not
been
deposited is as
follows:
Name of
the Nature of Dues Forum where Amount
Statute dispute is Pending (Rs. in
Crores)
Customs & Excise duty and CESTAT 28.13
Excise Act Modvat
-do- -do- Commissioner Appeals 2.68
-do- Customs Duty District Judge Court Nil
Visakhapatnam
-do- -do- Commissioner 0.97
Appeals, Hyderabad
-do- -do- -do- 0.24
APGST &
CST Sales Tax pending Sales Tax Appellate 17.51
Act concessional forms Authority
UP Trade
Tax ST appeal for Tribunal Bench, 0.01
Act 1994-95 Agra
R&D Cess
Act R&D Cess High Court of Kolkata 9.80
R&D Cess
Act R&D Cess -do- 3.38
10. Accumulated Losses
The company did not have any accumulated loss at the end of the financial year as it had posted a surplus
for the first time. The Company has not incurred cash losses in this financial year covered by our audit and
in the immediately preceding financial year.
>2
11. Repayment of dues to Banks or Financial Institutions
In our opinion and according to the records produced to us, the Company has not defaulted in repayment
of its dues to any Financial Institution or Bank during the year.
12. Loans and Advances on the basis of security by way of pledge of Shares etc.
In our opinion and according to the information and explanations given to us, the Company has not granted any
loans and advances on the basis of security, by way of pledge of shares, debentures and other securities.
13. Chit Fund or Nidhi / Mutual Benefit Fund / Society
In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund/ society. Therefore, the provisions
of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.
14. Trading in Shares, Shares etc.
In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly,
the provisions of clause 4(xiv) of the Comapanies (Auditors Report) Order, 2003 are not applicable to the Company.
15. Guarantee for Loan taken by others
We are informed that the company has not given any guarantee for loans taken by others from banks or financial institutions.
16. Application of Term Loans
According to information and explanations given to us, the Company had not availed any term loan during the year.
17. Usage of Short Term and Long Term Funds
According to the Information and explanations given to us and on an overall examination of the balance
sheet of the Company, we report that no funds raised on short-term basis have been used for long-term
investment. The Company has not raised any funds on long - term basis during the year.
18. Preferential Allotment of shares
According to the information and explanation given to us, the company has not made any preferential
allotment of shares to parties and companies covered in the register maintained under Section 301 of the
Act, during the year.
19. Issue of Debentures
According to the information and explainations given to us, the company had not issued debentures during the year.
20. End use of money raised by Public Issue
According to the informantion and explanations given to us, the company has not raised money by public issues during the year.
21. Frauds
According to the information and explanations given to us, no fraud on or by the Company has been
noticed or reported during the course of our audit.
Place : New Delhi For Rao & Kumar
Date : 10-06-2006 Sd/-
S.S. Bharadwaj
Partner
Chartered Accountant
Membership Number :
26113
><
+3A393/RD A9)I3/R+& C/((23+ I 3%2 A2E9R2 3/ 3%2
A9)I3/R+& R2'/R3 9:+ 45A6 /1 +C3I/ 22> /1 C/('AI2+&+ AC3 A) (AA$2(23+& R2'#I2+
Comment Management Reply
1 (a) Fixed Assets
The auditors' remarks pertain to certain assets procured
The Company has maintained proper records
showing
for use for construction of the Steel Plant, retained by
the
Company for use in
the production
period
afte
r
full particulars including quantative details of fixed
assets, except for historical cost figures in certain
construction
,
that
were capitalized in the
year
s
cases.
1990-91 and 1991-92
"Guidance Note on Treatment of Expenditure During
Construction Period" issued by the Institute of Chartered
Accountants of India, stipulates the accounting treatment
for assets used for construction of a project which are
also retained for use during operations stage of the
project. The relevant portion of paragraph No. 9.4 is
reproduced hereunder:
". If some equipment purchased during the period of
construction has been utilized only partly for the
purposes of construction, a part of the depreciation
thereon, on the basis of a suitable proportion, should be
capitalized as an indirect expenditure incurred during
the construction period. Thereafter, the total cost of the
equipment purchased during the construction period less
the depreciation charged during that period should be
carried forward to the production period so that the
accounts of the production period would begin with the
depreciated value of such equipment, which would then
be further depreciated in the normal way."
Therefore, in line with the Guidance Note of the
Institute, in respect of the assets procured during the
period for plant construction and subsequently retained
for use in the production periods, the values as reduced
by the depreciation for the period of construction are
taken to the Gross Block of Fixed Assets
>4
Annual Report 2005-
06
Comment Management Reply
2 Inventories have been physically verified during Stocks with conversion agents/custodians are accounted
(a
) the year by the management, except stocks with as per custodians' certificate which is disclosed at Note
conversion agents/custodians and with outside No. 10 of Schedule 28 (B) of Annual Accounts.
agencies and those referred to in Note No. 10 to
the Notes on Accounts, which are adopted based
on the book value amounting to Rs. 19.94 crores
out of the total reported stock of Rs. 1216.46
crores. In respect of stores and spares, company
has
a regular program of verification in a phased
manner,
which in our opinion, is adequate and reasonable
having regard to the nature and location of stocks.
2
Reconciliation between Priced Stores Ledger and
Bin Necessary disclosure has been made at Note No. 7 of
(c
) Card in respect of stores and spares was continued Schedule 28 (B) of Annual Accounts.
during the year. Adjustment has been carried out to
the extent reconciliation was completed.
Reconciliation is pending in respect of stores
and
spares whose value and impact of adjustments
pending is not ascertainable.
8 Maintenance of Cost Records
We have broadly reviewed the books of account
The compilation in the formats under Cost Accounting maintained by the company pursuant to the rules
made
Records can be completed only after completion of the
by the Central Government for the maintenance of
Statutory Audit of the Accounts since the audited
Cost Records under Section 209(1)(d) of the accounts are the basis for compilation of Cost
Accounting Companies Act, 1956 and we are of the opinion
that
Records. prima-facie the prescribed accounts and records
have
been made and maintained in respect of the
applicable
products. With respect to Power Generation,
Government of India notified Cost Audit for the
year
under audit. We are informed that compilation in
the
formats under Cost Accounting Records is in
progress. As such we could not verify the relevant
records. We have however not made a detailed
examination of the records with a view to
determine
whether they are accurate and complete.
>5
Annexure - II
COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF
INDIA UNDER SECTION 619(4) OF THE COMPANIES ACT, 1956 ON THE
ACCOUNTS OF RASHTRIYA ISPAT NIGAM LIMITED, VISAKHAPATNAM
FOR THE YEAR ENDED 31ST MARCH, 2006
1. PROFIT & LOSS ACCOUNT
Profit for the year : Rs. 1882.69 crore
1. The above amount is understated by Rs. 2.37 crore on account of following:
(1) Short accountal of interest (Interest earned - Schedule 18) amounting to Rs. 1.02 crore
accrued on term deposits with various banks upto 31st March, 2006.
(2) Under-valuation of Semi finished/finished goods by Rs. 1.78 crore due to not taking into
account the cost of a raw material consumed.
(iii) Over valuation of damaged/non-moving material inventory by Rs. 43 lakh.
2 Accounting Policies and Notes to Accounts (Schedule - 28)
2. The fact that raw material (Coal) valued at Rs.14.02 crore was lying in the custody of the
conversion Agent for more than two years has not been disclosed in the accounts.
3. The State Government of Andhra Pradesh demanded (December 2005) a sum of Rs. 7.57
crore towards Company's share of expenditure for works relating to Yeleru Water supply
scheme, against which a provision of Rs.1.93 crore exists in the books. The Company took
up the matter with the State Government for the remaining disputed amount of Rs. 5.64 crore.
Pending settlement of the matter, the Company has neither provided the liability
of Rs.5.64 crore nor disclosed the fact in the accounts.
Sd/-
( S.B. Pillay)
Principal Accountant General
>6
R2'#I2+ 3/ 3%2 C/((23+ /1 3%2 C/('3R/##2R A) A9)I3/R $22RA# /1 I)IA
/ 3%2 ACC/93+ /1 RA+%3RIDA I+'A3 I$A( #I(I32), .I+A7%A'A3A( 1/R 3%2
D2AR 2)2) <=+3 (ARC% 2006, 9)2R +2C3I/ 6=A546 /1 3%2 C/('AI2+ AC3, =A56*
Comment Reply
A
. PROFIT & LOSS ACCOUNT
Profit for the year: Rs.1882.69 crore
1
.
The above amount is understated by
Rs.2.37
crore on account of following:
(i
)
Short accountal of interest (Interest
earned-
The interest income on Term Deposits at the end of
year
is recognized based on the certifications issued by the
Schedule 18) amounting to Rs. 1.02 crore
Banks. The Banks would pay interest on maturity as accrued on term deposits with various
banks per the terms. Therefore, there would not be any loss
of
upto 31st March 2006.
interest.
(ii) Under-valuation of Semi finished/ finished Noted. It will be taken care in future.
goods by Rs.1.78 crore due to not taking
into
account the cost of a raw material
consumed.
(iii) Over-valuation of damaged / non-moving
Noted.
material inventory by Rs.43 lakh.
B
. Accounting Policies and Notes to Accounts
(Schedule-28)
2
. The fact that raw material (Coal) valued at
There is no specific disclosure requirement of the
item
Rs.14.02 crore was lying in the custody of
as per the accounting Standards. However this point
is
the conversion Agent for more than two
years noted.
has not been disclosed in the accounts.
3
. The State Government of Andhra Pradesh
Noted. If the issue is not settled in the year 2006-07, demanded (December 2005) a sum of
Rs.7.57
the fact will be disclosed in the Accounts for the year crore towards Company's share of
expendi-
2006-07. ture for works relating to Yeleru Water
sup-
ply scheme, against which a provision of
Rs.1.93 crore exist in the books. The
Com-
pany took up the matter with the State
Gov-
ernment for the remaining disputed
amount
of Rs.5.64 crore. Pending settlement of
the
matter the Company has neither provided
the
liability of Rs.5.64 crore nor disclosed the
fact in the accounts
>>
R2.I2F /1 ACC/93+ /1 RA+%3RIDA I+'A3 I$A( #I(I32)
1/R 3%2 D2AR 2)2) <=
+3
(ARC%, 2006
0D 3%2 C/('3R/##2R A) A9)I3/R $22RA# /1 I)IA
(This review of Accounts is prepared without taking into account the comments of C&AG of India under
Section 619(4) of the Companies Act, 1956 and the qualifications of the Statutory Auditors)
1. FINANCIAL POSITION
The table below summarises the financial position of the Company under broad headings for the last three years:
( Rs. in crore )
2003-04 2004-05 2005-06
LIABILITIES
1) Paid-up Capital
i) Government 7827.32 7827.32 7827.32
ii) Others
iii) Share money Pending Allotment
2) Reserves & Surplus
i) Free Reserves & Surplus 0.00 0.00 346.38
ii) Share Premium Account 0.00 0.00 0.00
iii) Capital Reserves
3) Borrowings
i) From Govt. of India
ii) Financial Institutions
iii) Cash Credit 37.17 88.94 88.15
iv) Short term Foreign Currency Loans -- 0.00 369.44
v) Others
vi) Interest Accrued & Due 0.00 0.00 0.00
4) Current Liabilities and Provisions
i) Current Liabilities and Provisions 1156.15 1335.55 1467.61
ii
) Provision for Gratuity 79.20 88.61 120.25
e) Deferred Tax Liability 0.00 158.49 316.72
Total 9099.84 9498.91 10535.87
ASSETS
f) Gross Block 8709.72 8763.49 8832.13
g) Less: Cumulative Depreciation 5337.59 6322.18 6753.87
h) Net Block 3372.13 2441.31 2078.26
i) Assets held for disposal 0.03 0.00 0.01
j) Capital Work-in-Progress 25.45 61.07 180.73
k) Investments* 0.00 0.00 0.00
l) Current Assets, Loans & Advances 2726.69 6047.52 8252.00
m) Miscellaneous Expenditure 61.45 43.02 24.87
(to the extent not written-off)
n) Accumulated Loss 2914.09 905.99 0.00
Total 9099.84 9498.91 10535.87
* Investments amounted to Rs.0.03 lakhs and hence are shown as NIL in Crore Rupees.
>?
o) Working Capital [k-d(i)-c(vi)] 1570.54 4711.97 6784.39
p) Capital employed (h+o) 4942.67 7153.28 8862.65
q) Net Worth [a+b(i)+b(ii)-m-n] 4851.78 6878.31 8148.83
r) Net worth per rupee of
Paid-up Capital (Rs.)(q/a) 0.62 0.88 1.04
(including Share Money Pending Allotment)
2. RATIO ANALYSIS
Some important financial ratios on the financial health and working of the Company at the end of last three years are as under :
2003-04 2004-05 2005-06
A) Liquidity Ratios :
Current Ratio 2.36 4.53 5.62
(Current Assets to Current Liabilities
& Provisions and Interest accrued &
due but excluding provision for Gratuity) [k/{d(i)
+c(vi)}]
B) Debt Net Worth Ratio :
Long Term Debt to Equity 0.00 0.00 0.00
[c (i to iv but excluding short term loans)/q]
3) Profitability Ratios :
1) Profit before tax to
i
) Capital Employed (%) 31 32 21
i
i
) Net Worth (%) 32 33 23
i
i
i
) Sales (%) 25 28 22
b) Profit after tax to Equity (%) * 19.77 25.65 16.00
c) Earning per Share (in Rupees) 316.41 410.67 256.12
1* including Preference share capital
3. SOURCES AND UTILISATION OF FUNDS
Funds amounting to Rs. 2236.84 crore from internal and external sources were utilised during the year
ended 31
st
March, 2006 as given below:
(Rs. in crore)
1) SOURCES OF FUNDS
a) Funds from Operations
1708.8
0
b) Sale of Fixed Assets 1.16
c) Increase in borrowings
368.6
5
d) Increase in Deferred Tax Liability
158.2
3
Total Funds inflow during the year
2236.8
4
2) UTILISATION OF FUNDS
e) Increase in Working Capital
2072.4
2
f) Increase in Fixed Assets
164.4
2
Total funds outflow during the year
2236.8
4
>A
4. CAPACITY UTILISATION
The following table indicates the position of capacity utilisation of different production facilities for the last three years :
PRODUCT YEAR Installed Actual Percentage
Capacity Production of Actual
Production
to
Installed
TONNES
000 Capacity
a
) Wire Rods 2003-04 850 974 115
2004-05 850 1014 119
2005-06 850 1043 123
b
) Light & Medium Merchant 2003-04 710 815 115
Products - Bar Mill 2004-05 710 858 121
2005-06 710 873 123
c
) Saleable Billets 2003-04 246 224 91
2004-05 246 137 56
2005-06 246 110 45
d
) Medium Merchant & 2003-04 850 993 117
Structural Mill 2004-05 850 1014 119
2005-06 850 1058 124
e
) Pig Iron 2003-04 556 439 79
2004-05 556 273 49
2005-06 556 439 79
f
) Granulated Slag 2003-04 1440 1569 109
2004-05 1440 1514 105
2005-06 1440 1578 110
g
) Coke Ovens 2003-04 186 150 81
By-Products 2004-05 186 145 78
2005-06 186 152 82
?0
5. WORKING RESULTS
The Company started Commercial Production in 1990-91. The following table indicates the position of
Sales and Profit/Loss(-) for the last three years:
(Rs. in crore)
2003-04 2004-05 2005-06
Sales 6169.09 8181.34 8482.44
Profit/Loss (-) before Tax 1547.19 2253.77 1889.51
Profit/Loss (-) after Tax 1547.19 2008.09 1252.37
6. INVENTORIES
The following table indicates the position of inventory at the end of last three years:
( Rs.
in
crore)
2003-04 2004-05
2005-
06
Raw Materials 185.69 440.12
470.6
1
Stores & Spares including Scrap 292.89 277.04
273.5
4
Semi Finished/Finished Goods 227.76 538.15
472.3
0
Total 706.34 1255.31
1216.4
5
The stock of raw materials in terms of number of months consumption increased from 1.09 in
2003-04 to 1.75 in 2004-05 and
decreased
to 1.58 in 2005-06.
7. SUNDRY DEBTORS VIS--VIS SALES :
The following table indicates the value of Sundry Debtors and Sales for the last three years:
( Rs. in crore)
Particulars As on As on As on
31-3-
2004 31-3-2005 31-3-2006
SUNDRY DEBTORS :
Considered Good 85.62 49.30 165.65
Considered Doubtful 20.85 20.28 19.37
Total 106.47 69.58 185.02
Sales 6169.09 8181.34 8482.44
Percentage of Debtors to Sales 1.73 0.85 2.18
Sd/-
( S.B. Pillay )
Principal Accountant General
Place : Hyderabad
Date : 28.07.2006
?=
AnneGure - A
MEASURES TAKEN FOR CONSERVATION OF ENERGY DURING THE YEAR 2005-06
1. Sp. Energy consumption reduced from 6.14 Gcal/t LS in 2004-05 to 6.08 Gcal/tLS in 2005-06 due
to various energy initiatives taken during the year and the production unit wise details are given
below.
1 Sp. Heat consumption in Coke Oven decreased from 641 M.Cal/t DCC in 2004-05 to 629 M Cal/t
DCC in 2005-06 by optimization of cross wall temperature in Batteries.
2 Sp. Heat consumption in Blast Furnace decreased from 511 M.Cal/t HM in 2004-05 to 482 M Cal/t
HM in 2005-06 by optimization of combustion in BF stoves.
3. Sp. Heat consumption in SMS decreased from 38 M.Cal/t LS in 2004-05 to 35 M Cal/t LS in 2005-
06 by optimization of heating time in Ladle Preparation Bay and Continuous Casting Department.
4. Sp. Heat consumption in Billet Mill decreased from 492M.Cal/t Blooms in 2004-05 to 491 M Cal/t
Blooms in 2005-06 by improving rolling rate.
5. Sp. Heat consumption in WRM decreased from 255 M.Cal/t Billets in 2004-05 to243 M Cal/t Billets
in 2005-06 by optimization of Calorific Value and pressure of mixed gas.
6. Sp. Heat consumption in MMSM decreased from 359 M.Cal/t Blooms in 2004-05 to 344 M Cal/t
Blooms in 2005-06 by maintaining proper thermal regime.
2. OTHER ACHIEVEMENTS
1. LD gas recovery plant
Total Volume of LD gas recovered 363.56 MNCum
2. Waste Heat recovery at
1) Back Pressure Turbine Station
Total Power recovered
106889
MWH
2) Gas Expansion Turbine Station
Total Power recovered
91664
MWH
?2
3. FOREIGN EXCHANGE EARNINGS & OUTFLOW :
Foreign
Exchan
ge Inflow
R
s
. 443.51 crores
Foreign
Exchan
ge Outflow
R
s
.
1867.30
crores
ACTIVITIES RELATING TO EXPORTS 2005-06
A total of 305436 MT of Iron & Steel materials were exported in 2005-06 as against 165109 MT in 2004-
05, registering a growth of 85%. In terms of value, a total of Rs.449.81 crores of materials were exported
as against Rs.255.14 crores in 2004-05 registering a growth of 76.30%. VSP also exported 688427 MT
of BFG Slag in 2005-06 as against 597438 MT in 2004-05, registering a growth of 15.23%.
VSP also focused on export sales to the neighboring countries, Sri Lanka, Bangladesh & Nepal. A total
of 61413 MT of steel materials were exported to Sri Lanka in 2005-06 as against 15683 MT during the
last year. In Nepal, a total of 21894 MT of steel materials were sold as against 5080 MT during the last
year. A huge growth was registered in the export sales to Bangladesh by selling 68397 MT in 2005-06 as
against 4803 MT during the last year.
VSP also sold 15370 MT of steel materials to South East Asian countries in 2005-06 as against 6135 MT
during 2004-05.
VSP also sold 20787 MT of WR Coils to the quality conscious market in USA in 2005-06 as against
10147 MT during 2004-05, thereby establishing its superior quality parameters of WRC.
The plan of exports for the year 2006-07 is to achieve a sale of 4.80 lakh MT of Iron and Steel products,
an increase of 57.37% over the export sales of 2005-06.
?<
FORM - A
FORM FOR DISCLOURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY
1. Power and fuel consumption 2005-06
1) Electricity
a) Purchased ( Net Import from AP TRANSCO)
40389
MWH
b) Gross exported
57549
MWH
c) Imported
97938
MWH
4) Own generation
- Through steam turbine / generator 1784062
M
W
H
- Through BPTs 106889
M
W
H
- Through GETS 91664
M
W
H
2) Coal Consumption
Boiler Coal 1576624 t
Imported Coking coal 2358502
US Coal 25773 t
Imported Soft Coking coal 386749
Indigenous Medium coking coal 540084
3) Furnace oil Consumption 1049
4) HSD Consumption 2887
5) BF Coke purchased 325683
2. Consumption per unit of production:
Item Unit Per tonne of liquid steel production
Imported electricity kwh 15.96
Furnace oil lt 0.18
HSD lt 0.02
Coking coal
Imported Coking coal kgs 540.30
US Coal kgs 5.86
Imported Soft Coking coal kgs 88.36
Indigenous Medium coking
coal kgs 123.83
Boiler coal kgs 284.76
BF Coke purchased kgs 79.63
Liquid steel production 3602754 t
?4
FORM - B
FORM FOR DISCLOSURE OF PARTICULARS WITH
RESPECT TO TECHNOLOGY ABSORPTION
RESEARCH & DEVELOPMENT (R & D) :
1. Specific Areas in which R&D was carried out by the Company:
1. Effective usage of solid wastes
2. Study on usage of pellets, sponge iron as alternative raw material in the Blast Furnace
3. Study on Low Temperature Thermal Desalination with Pilot Plant
4. Study on effect of moisture and granulometry on bulk density of charge coal
5. Strengthening of charge pad of converter with stainless steel fibre reinforced refractory to increase its
life
6. Improvement of blowing process parameters by varying geometry of lance tip
7. Upgradation of NDT method of rolling mill rolls for efficient roll utilization
8. Study on scale loss during reheating in rolling Mills
9. Development of new grades.
2. Benefits derived as a result of above R&D :
A brief note on R&D activities taken up during Apr'05-Mar'06 with highlights is given at Enclosure-1.
3. Future plan of action :
1. Developing in-house pilot oven and testing the carbonization properties of new coals to optimize the
blends
2. Study the techno-economics of briquetting of SMS, GCP sludge and charging into the converter for
better waste utilization
3. In-house development of a pot sintering unit and testing the effect of different raw materials and addi-
tives on sinter properties
4. Study the effect of discharge temperature, soaking time, deformation in various stands and rate of
cooling on generation and propagation of cracks in billets and rounds of chromium steel and spring
steel
4. Expenditure on R&D
a) Capital
Rs. 1.83
Crores
b) Revenue
Rs. 8.63
Crores
c) Total
Rs.10.46
Crores
R&D expenditure as a 0.124%
%age of turnover
?5

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