VISA Steel : 2022-23 – Annual Report

ANNUAL REPORT 2022-23

Vision

Create long term stakeholder value through value addition of natural resources

Core Values

Content

TRANSPARENCY

We are transparent and honest in our profession to all our stakeholders

PASSION

We are passionately committed to delivering excellence in performance

TEAM WORK

We work together as a team to benefit from our complementary strengths

ATTITUDE

We demonstrate ownership in our attitude to create sustainable value for shareholders

GOVERNANCE

We are committed to best standards of safety, corporate social responsibility and corporate governance

COMPANY OVERVIEW

STATUTORY REPORTS

FINANCIAL STATEMENTS

LISTING

Chairman's Insight	02
Vice Chairman & MD's Message	03
Board of Directors	04
Corporate Social Responsibility	06
Report of the Directors	08
Management Discussion and Analysis	22
Corporate Governance	25
Standalone	37
Consolidated	91

Your Company has been listed on National Stock

Exchange of India Limited and BSE Limited

FORWARD-LOOKING STATEMENTS

In this Annual Report, we have disclosed forward-looking information to enable investors to comprehend our prospects and take investment decisions. This report and other statements, both written and oral, that we periodically make contain forward-looking statements that set out anticipated results based on the management's plans and assumptions. We have tried wherever possible to identify such statements by using words such as 'anticipate', 'estimate', 'expects', 'projects', 'intends', 'plans', 'believes' and words of similar substance in connection with any discussion of future performance. We cannot guarantee that these forward-looking statements will be realised, although we believe we have been prudent in our assumptions. The achievements of results are subject to risks, uncertainties and even inaccurate assumptions. Should known or unknown risks or uncertainties materialise, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated or projected. Readers should keep this in mind. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

ANNUAL REPORT 2022-23

2 VISA STEEL LTD.

CHAIRMAN'S INSIGHT

COMPANY OVERVIEW

3

VICE CHAIRMAN & MD'S MESSAGE

The Government's initiatives to implement reforms and revive the manufacturing sector is expected to increase demand for Ferro Alloys going forward and the Company is focused on implementing Debt Resolution as per Reserve Bank of India (RBI) guidelines and plans to raise funds for working capital

implementing Debt Resolution as per Reserve Bank of India (RBI) guidelines and plans to raise funds for working capital by inducting Investor, reducing cost and keeping the Plant operational.

OUTLOOK

The Government's initiatives to implement reforms and revive the manufacturing sector is expected to increase demand for Ferro Alloys going forward. However, some of the key risks going forward include high inflation globally, prolonged Russia-Ukraine war, high interest rates and weakness in Chinese economy, especially real estate sector.

I would like to place on record my sincere appreciation and gratitude to the entire team of VISA Steel for its relentless commitment inspite of the challenging business environment. I am grateful to the members of the Board of the Company for their invaluable guidance and contribution and acknowledge the support of all shareholders. I would also like to convey my sincere thanks to all the stakeholders including shareholders, lenders, suppliers, customers, Government officials and employees for their valued support as we

As a responsible corporate, the Company is focused on the happiness of people living in its neighbouring communities. Our CSR team has directed the community development work in the areas of education, healthcare, rural development, sports and culture and wishes to continue supporting this also ensuring safety and well-being of employees

State Bank of India (Lead bank) implemented resolution through sale/ assignment of debt to ARCs. Other Banks including Vijaya Bank (since merged with Bank of Baroda), SIDBI, Bank of Baroda, Dena Bank (since merged with Bank of Baroda), Indian Overseas Bank, Central Bank of India, UCO Bank and State Bank of Travancore (since merged with State Bank of India) have already implemented Resolution through sale/assignment of debt to ARCs. Other Banks are also in various stages of implementing Resolution through sale/assignment of debt to ARCs.

HUMAN RESOURCE

Your Company has been focused on ensuring safety and well-being of employees. The Company recognises Human Resource as its most important asset and is constantly engaged in developing its employees through various development & training programmes. We improve our team building through various employee engagement social activities.

CORPORATE SOCIAL

RESPONSIBILITY

navigate through these challenging times and I hope to continue to receive your

Dear Shareholders,

As per our core philosophy, Health, Safety and Environment continues to be one

Dear Shareholders,

For the year ended 31 March 2023, your Company's consolidated Revenue from operations was at I6,574.84 million in

FY 2022-23 compared to I11,184.56 million in FY 2021-22 and operating profit was I104.12 million in FY 2022-23 compared to I190.91 million in FY 2021-22.

Due to non-availability of working capital, the operations of your Company continued under conversion arrangement.

1.41 million tonnes. India exported approx. 51% of its Ferro Chrome production, primarily to China.

India's Chrome Ore production reduced from approx. 3.77 million tonnes in

FY 2021-22 to approx. 3.68 million tonnes in FY 2022-23, out of which OMC produced approx. 1.07 million tonnes of Chrome Ore in FY 2022-23 against an EC capacity of 1.53 million TPA.

support in the future.

Warm regards & best wishes,

Vishambhar Saran

Chairman

Your Company has set up manufacturing facilities in Odisha for production of Ferro Alloys. The operations of the Company continued as a going concern inspite of non-availability of working capital for operations and other external factors beyond the control of the Company and its management.

OPERATIONS

The operations of Ferro Chrome Plant continued under conversion arrangement with support of related parties and other

of our key priorities. As a responsible corporate, the Company is focused on the happiness of people living in its neighbouring communities. Your Company's CSR team has directed its community development work in the areas of education, healthcare, rural development, sports & culture and your Company wishes to continue supporting this. I would like to convey my sincere thanks to all the stakeholders of the Company for their valued support.

THE INDUSTRY	VISION & STRATEGY
The global High Carbon Ferro Chrome	Your Company is committed to its
production was at approx. 14.53 million	vision to create long term stakeholder
tonnes in 2022, out of which India's Ferro	value through value addition of natural
Chrome production stood at approx.	resources. The Company is focused on

operational creditors, without which Plant operations as a going concern would be impossible causing a risk of Plant closure and agitation and other law and order problems.

FINANCE

Your Company has been under financial stress since 2011-12 due to various external factors beyond the control of your Company and its management. Despite the debt restructuring on 27 September 2012 and 31 December 2014, the Lenders did not disburse sanctioned facilities for operations, and adjusted the same with interest resulting in complete depletion of working capital and it now appears that the whole exercise of purported restructuring was mere evergreening of debt without even considering its adverse effect on the Company's operations. It is expected that the overall financial health of the Company would improve only after debt resolution and improvement in availability of working capital, for which the Company plans to raise funds by inducting Investor.

With warm regards,

Vishal Agarwal

Vice Chairman & MD

ANNUAL REPORT 2022-23

4 VISA STEEL LTD.

BOARD OF DIRECTORS

COMPANY OVERVIEW

5

MR. VISHAMBHAR SARAN

Chairman

Born on 4th December 1947 at Faizabad, U.P., Mr. Saran secured a Bachelor's Degree in Mining Engineering from Indian Institute of Technology, Banaras Hindu University in 1969. He served Tata Steel for 25 years, starting from their various mines, Paradip Port and Kolkata & Jamshedpur Offices. He rose to the position of Director

• Raw Materials, Tata Steel in 1988 & Director of Budgets in 1993. He availed voluntary retirement from 31st March, 1994. Mr. Saran founded the VISA Group in April 1994 and has built it up from scratch to a significant minerals and metals conglomerate. Philanthropically, creating and improving educational and medical facilities for the poor in backward districts of Odisha, UP and West Bengal through "VISA Trust", founded by him and his wife.

Mr. Saran is Honorary Consul of the Republic of Bulgaria for Eastern India; Trustee on the Board of Kalyan Bharti Trust

• VISA Trust; Chairman of the Board of Governors, Heritage Law College, Kolkata; Member of National Executive Committee of Federation of Indian Chamber of Commerce Industry (FICCI).

Formerly, Mr. Saran was the President of Indian Chamber of Commerce, Kolkata; President of Coal Consumers Association; Trustee on the Board of Chennai Port Trust; Member of Governing Council of the International Chromium Development Association, Paris; Raw Material Committee of the International Iron & Steel Institute, Brussels; CII Eastern Regional Committee; Board of Tata Sponge Iron Limited and Standard Chrome Limited.

MR. VISHAL AGARWAL

Vice Chairman & Managing

Director, Chairman, Corporate Social

Responsibility Committee

Mr. Agarwal holds a Bachelor's Degree from London School of Economics and a Master's Degree from Oxford University. He was born in Faizabad, Uttar Pradesh and completed his schooling from Mayo College, Ajmer and Cheltenham College, UK. He has almost 26 years of rich experience in the Iron & Steel industry with hands on experience of setting up greenfield projects and international trading business. During 1997 to 2004, Mr. Agarwal developed the international trading business for the VISA Group in minerals and metals including Chrome Ore, Iron Ore, Manganese Ore, Alumina, Ferro Alloys etc. Since 2004, he has built the manufacturing business of the VISA Group from scratch.

MS. RITU BAJAJ

Independent Director, Chairperson, Audit Committee

Ms. Ritu Bajaj, is a Practicing Company Secretary and a Fellow Member of the Institute of Company Secretaries of India (FCS). She has 20 years of experience in Corporate Law, Due Diligence, Secretarial Audits and other Allied Laws. She is a certified CSR Professional and has been with a start-up where she was closely partnering with the CEO to drive business performance. Since 2013, she is successfully running a Peer Reviewed Practicing Company Secretaries Firm under the name of RP and Associates. Her core skills include Mergers & Acquisitions, Buyback, National Company Law Tribunal matters, Drafting of Share Purchase and other Commercial Agreements, SEBI Laws and Regulations and other compliances.

MR. BISWAJIT CHONGDAR

Independent Director,

Chairman - Stakeholders

Relationship Committee

Mr. Biswajit Chongdar has worked as Executive Director, In-charge (Marketing) with Steel Authority of India Limited, one of the largest steel producers in the country. During his 38 years of his exposure in SAIL, he has handled Domestic and International Marketing, Logistics and Raw Material sourcing. He is a BE in Civil Engineering from BE College, Shibpur and has attended SAID Business School, Oxford University for an Advance Marketing Course. He has also done Specialised Management Programme at Indian Institute of Management, Kolkata.

As a Head of Marketing function of SAIL, he has played a key role in the introduction of new products, devise strategies of marketing, development of new marketing areas, transparent marketing policies and branding etc. He has successfully headed the Marketing Department of SAIL for 4 Years as an Executive Director.

MR. DHANESH RANJAN

Independent Director,

Chairman - Nomination &

Remuneration Committee

Mr. Dhanesh Ranjan secured a Master's Degree in Economics from Ranchi University and Diploma in Maritime Law from Lloyd's Maritime Academy, London. He joined Steel Authority of India Limited (SAIL) as Management Trainee and retired as Executive Director (Coal Import Group). He served SAIL for 36 years in various positions and offices. He has travelled overseas to several countries in the course of his appointment for facilitating business of the Company. Throughout his career, he has been at the cutting edge of policy making and strategizing in different areas and divisions of SAIL.

MR. MANOJ KUMAR

Wholetime Director designated as Director (Kalinganagar)

Mr. Manoj Kumar is a Mechanical Engineer from BIT Mesra, Ranchi. He has over 32 years of experience of working in various positions in the Iron & Steel industry. He had been accredited with bringing the concept of ABP based procurement into the company and was also responsible for streamlining the operational procurement by entering into Annual Rate Contracts & Vendor Stockings. He had played a key role in the Company's projects & operations.

ANNUAL REPORT 2022-23

6

VISA STEEL LTD.

COMPANY OVERVIEW

7

CORPORATE SOCIAL RESPONSIBILITY

Your Company is focused on strengthening and enriching the lives of people living in its larger neighbouring communities. During the year, the CSR activities were dominated by accelerated efforts and momentous growth in our focus areas of quality education, healthcare, nutrition, sanitation, skill development, safety & environment, rural development, sports and culture.

EDUCATION

HEALTHCARE

RURAL DEVELOPMENT	SAFETY AND ENVIRONMENT SPORTS AND CULTURE

Your Company ensures access to quality education and learning opportunities for all, with special emphasis on scholarship programs and others such as:

• Providing scholarships to meritorious students from underprivileged background in Odisha and Kolkata and also to students at Smt. Sarala Devi Saraswati Balika Inter College in Tilhar, Uttar Pradesh
• Established The Heritage School and The Heritage Institute of Technology through Kalyan Bharti Trust in Kolkata
• Setting up of Science and Computer labs at Schools and Colleges in Odisha, supply of library books, Infrastructure Support, Transport Facilities, among others in Odisha and Kolkata
• Organising painting competition in schools in Odisha
• Conducting training on Basic First Aid Program for the students to prepare them to handle emergency situations
• Providing vocational training to women in Odisha for taking up employment and encouraging entrepreneurship in a skilled craft as artisan

Your Company is making continuous efforts to provide access to quality healthcare solutions through:

• Organising medical camps with free medicine distribution in the nearby villages of Kalinganagar Plant, Odisha
• Organising eye camps and cataract operations in the nearby villages in association with Bhumika Eye Hospital, Jajpur Road
• Creating mass awareness on menstrual hygiene along with breast, ovarian and cervical cancer amongst ladies from the nearby communities of Kalinganagar Plant, Odisha
• Conducting health check-up camps in schools and increasing awareness and educating students about personal and menstrual hygiene

• Constructing Healthcare Unit at CHC Danagadi and OPD shed at PHC, Jajpur to improve healthcare facilities for all
• Conducting Blood Donation Camps in Jajpur
• Supporting Medical Institutes, Odisha Blood Bank (Jajpur Road), Community Health Centre (Jajpur Road) with equipment and infrastructure support
• Creating awareness on cleanliness and sanitation, aligned with 'Swachh Bharat' initiative
• Undertaking initiatives to control malaria and dengue

Your Company is making sustainable rural livelihood improvements and enhancing access to better amenities through:

• Undertaking development of roads and renovation of temples and heritage sites in Odisha
• Installation of High mast light to illuminate the area for the heavy vehicle and pedestrian use and safety in Jajpur
• Providing safe drinking water in the backward areas of Odisha
• Renovation of primary health centre and lending support to fight against natural calamity

Your Company, in its journey towards environmental excellence, continues with its resolute effort by:

• Conducting regular safety training sessions for employees and contract labourers
• Extending support towards animal welfare
• Undertaking mass plantation drives to beautify Divider area in Jajpur and in nearby government schools, hospital and public places
• Launching water recycling initiatives to preserve ground water levels
• Distributing saplings among villagers to encourage plantation

Your Company aims to promote sports and art amongst the youth by way of creating a platform to facilitate their skills through:

• Sponsoring and organising Annual Ladies Golf Tournament at Tollygunge Club, Kolkata
• Working towards preserving contemporary Indian arts, culture and heritage for the future generation with the aim to support and promote talented artists and craftsmen

ANNUAL REPORT 2022-23