Tata Steel Annual Report 2019
Tata Steel Annual Report 2019
Tata Steel Annual Report 2019
419 Notice
`29,770 Cr.
EBITDA
`9,098 Cr.
Profit After Tax
(PAT)
Our steel has gone into the making of
futuristic structures and buildings across
the globe.
Taipei 101, Taipei, Taiwan
2 81.6
Solid Waste Utilisation Specific Water Consumption CSR Outreach
33.12%
Promoter and
Promoter Group
0.6%
Other Businesses
3
BOARD OF DIRECTORS (As on April 25, 2019)
2 6 1 2 3
5
FROM THE CHAIRMAN’S DESK
Dear Stakeholders,
It is a privilege to write to you as the
Chairman of the Board of Tata Steel.
Financial Year 2018-19 was a good year for
your Company, wherein your Company
executed well on its strategic roadmap and
delivered a strong financial performance.
Last year in my communication to you,
I shared with you the Company’s strategy
to leverage the growth potential of the
Indian economy by pursuing both organic
and inorganic growth opportunities. I am
happy to share with you that your Company
has made significant progress in this regard.
Your Company undertook the following
tangible steps to strengthen and expand
the India operations.
Your Company successfully completed On a consolidated basis, your Company demand for industries such as steel. India
the acquisition of Bhushan Steel (now achieved the highest ever levels of revenues also has a large natural resource base and
named Tata Steel BSL) under the Insolvency and EBITDA this year. I am happy to report skilled manpower to be one of the most
and Bankruptcy Code process. This was that the Company has generated positive competitive manufacturers of steel globally.
an important strategic acquisition. free cash flows of ₹8,839 crore this year, for While the short-term global macroeconomic
The integration is proceeding well with the first time in over a decade. and geopolitical situation may continue to
identified synergies and roll-out of throw some challenges, the future holds
As you are aware, your Company had
the performance improvement plan. many opportunities for your Company.
proposed to form a joint venture with
The Board has given the approval for the Your Company is well positioned to
thyssenkrupp to combine the steel
amalgamation of Tata Steel BSL with your capitalise on the opportunities and deliver
businesses in Europe, as a part of the
Company and the process is currently strong growth.
effort to build a sustainable business in
underway. This would further help in
Europe. Unfortunately, this proposal has I would like to thank all the shareholders
realising synergies and create a unified and
not met with the approval of the European for their faith in and support to the
simple organisation.
Commission and your Company has Company. I would also like to thank all other
In addition to Tata Steel BSL, your Company decided not to continue on this path. stakeholders, including the employees,
also acquired the steel business of Usha unions, customers, government and
Your Company’s overall situation is
Martin Limited, through its subsidiary suppliers, for their continued support.
much better now. Your Company’s India
company, Tata Sponge Iron Limited.
capacity and contribution has expanded
This acquisition has strategically enhanced
significantly. The plant in the UK contributes
the value-added long product portfolio of Warm regards,
to 11% of your Company’s total capacity
your Company and expanded its presence
and the plant at IJmuiden contributes to N. Chandrasekaran
in the premium and niche segment for
22% of your Company’s capacity. Your Chairman of the Board
automotive customers.
Company is on the path to drive operational
Your Company continues to grow its India improvement and positive cash flows.
capacity through brownfield expansion of
Steel is a strategic material for growth and
the Kalinganagar facilities.
development of nations and has a multiplier
In Europe, your Company’s operations impact on the economy and society. India
continued to face challenges. The has the unique advantage of a young and
production was lower due to operational aspirational population and high economic
issues at both sites in the UK and IJmuiden. growth, which would drive sustained
7
MANAGEMENT SPEAK
Q: How has Tata Steel group performed Q: The second half of 2018 saw a global steel demand showed resilience and
in Financial Year 2018-19? slowdown in growth owing to trade grew at 2.1%, supported by some recovery,
tensions and the geo-political in investment activities and improved
Financial Year 2018-19 was a strategically
environment and the same is performance of emerging markets and
important year for us. Even though the
expected to continue in the first half developing economies. In the coming
macro environment remained mixed,
of 2019. How do you expect this to year, global steel demand is expected to
we progressed significantly on our strategic
affect the steel industry? witness a gradual recovery, though at a
goals, focussing on operating performance
lower pace, owing to risk of uncertainty
to register the highest ever EBITDA, 2018 witnessed a slowdown in global
over the trade environment. Though the
enhancing our footprint in India through growth, primarily due to the decline in trade
economic fundamentals of the European
the acquisition of Bhushan Steel and Usha and manufacturing activity across most
Union economy remain relatively stable,
Martin Steel businesses, and strengthening industrial sectors, increased trade tensions
steel demand in 2020 will show some
our balance sheet through significant among major economies, tightening of
deceleration over the growth seen in
deleveraging from the peak debt post the financial conditions and policy uncertainty
2018 and 2019, partly due to uncertainties
acquisition of Bhushan Steel. in many economies. Despite this slowdown,
resulting from global trade tensions and
the uncertainties about Brexit. In 2019, the year will place us in a good position to augment its long products capacity and be
US growth is also expected to slow down capitalize on the opportunities in the future. prepared to cater to the increasing demand,
with the effect of fiscal stimulus tapering off we acquired the 1 MnTPA steel business
During the year, we successfully completed
and the normalisation of monetary policy. (including captive power plants) of Usha
the acquisition of Bhushan Steel (renamed
Martin Limited through our subsidiary
In India, steel demand in the first half of the Tata Steel BSL) to add to our downstream
company, Tata Sponge Iron Limited.
financial year was more stable than in the capability and complement our product
The acquisition will help the Company
second half and there has been a distinct mix. We have had a very encouraging start
retain its long product market share while
decline in the automotive sector and other to the integration journey and are well on
marking an entry into the special steels
sectors in the second half of the year. One our way to ramp up the capacity of Tata
segment as well as to enhance its product
of the key issues has been the credit flow Steel BSL to the rated level. This acquisition
basket for automotive customers.
in the system and we hope that structural has provided us the opportunity to scale-up
policy actions will be undertaken to ensure our operations and strengthen our market During the year, we also commenced the
that increased credit flow is restored and position in various market segments. Tata Steel Kalinganagar Phase II expansion
private investment is encouraged to revive project to augment the cumulative capacity
An important area of focus in the coming
the economy. of the Kalinganagar plant from 3 MnTPA
year will be to continue our efforts to
to 8 MnTPA. As part of the expansion in
Q: Steel demand in India is expected to further integrate the business of Tata Steel
Kalinganagar, we are building a 5800 cubic
increase in the medium term. What BSL with the existing business operations
metre blast furnace, which will enhance the
is your preparedness to capitalise on in Tata Steel Limited through the process of
asset productivity significantly, along with a
these opportunities? amalgamation. This integration, we believe,
state-of-the-art cold rolling mill complex to
will realise synergies, including better
We recognise that there is a significant produce value-added products. We will be
facility utilisation, efficient and assured
potential for increase in steel demand expanding the existing steel melting shop
availability of raw materials, reduced
in India in the long term given that per and hot strip mill and will also be adding
logistics and procurement costs, efficiencies
capita steel consumption in 2018 was a coke oven battery and a pellet plant.
arising out of a single value chain,
less than one-third of the world average. The project involves a capital expenditure of
reduced working capital, simplification
Various government initiatives, including ₹23,500 crore. The project scope and costs
of the operating structure and improving
‘Make in India’ projects, increased spending include investments in raw material capacity
customer satisfaction levels.
on infrastructure and increased focus on expansion, upstream and midstream
rural development are likely to support We also envisage that the demand for facilities, infrastructure and downstream
increase in domestic demand for steel, long products will grow significantly in the facilities. The expansion work is in progress
providing opportunities for domestic steel future. Tata Steel is already present in the and the facilities will be commissioned in
players. At Tata Steel, we have always long products business and is recognised phases, with the first commissioning of
focussed on sustained growth in India and for its high-quality products such as the cold rolling mill facilities in Financial
we believe that the steps taken during rebars, wire rods and wires. However, to Year 2020-21 followed by the balance
commissioning. The expanded capacity will
9
MANAGEMENT SPEAK (Continued)
help us produce value-added products, Our aim will be to further deleverage remedy package would have adversely
including cold rolled galvanised and the balance sheet of the Company, in affected the basic foundation of the
annealed products, and will enable us to Financial Year 2019-20 and beyond, proposed joint venture and the intended
meet the requirements of the automotive, through a combination of internal cashflow synergies arising from the merger to such
general engineering and other high-end generation and continuing efforts to an extent that the economic logic of the
quality product market segments. rationalise the portfolio to focus on our core joint venture would no longer be valid and
businesses and markets, while continuing to its fundamental sustainability would be
We are positive that through our existing
facilitate our key growth initiatives. severely impacted.
operations in India, coupled with these
organic and inorganic growth initiatives, Q: What are your future plans regarding We remain committed to these strategic
we are on the right path towards the European business? goals and will continue to focus on
strengthening our business in India and improving the operational performance
During the year, the revenues from Tata
are well poised to take advantage of the to enhance earnings and cash flows to
Steel Europe stood at ₹64,777 crore while
potential opportunities in India. ensure that the European business is
the EBITDA was ₹5,414 crore, reflecting an
self‑sustaining.
Q: There is a considerable amount of increase of 46% over the previous year.
debt on the books of the Company. Q: One of the strategic objectives for
In June 2018, we had signed definitive
What steps are you taking to Tata Steel is to consolidate its position
agreements with thyssenkrupp to combine
deleverage the balance sheet? as a global cost leader. What is your
our steel businesses in Europe to create
plan to meet this objective?
During the first half of Financial Year a 50:50 pan-European joint venture
2018‑19, the gross debt level at ₹1,18,680 company focussing on customer centricity, At Tata Steel, we are focussed not just on
crore was at its peak owing to the technology and sustainability. This merger growth, but on sustainable growth, to
acquisition of Bhushan Steel (Tata Steel BSL). transaction, like any other, was subject make a better tomorrow for our business
Through conscious and rigorous efforts, we to merger control clearance in several and for all our stakeholders. While we are
reduced our gross debt by ₹17,864 crore to jurisdictions, including most importantly, keenly focussed on our long-term strategy
end the year with a debt of ₹1,00,816 crore. by the European Commission. As part of to be the industry leader in steel globally
We will continue to focus on deleveraging the application made to the European and are channelising our efforts towards
as a primary strategic initiative to rebuild Commission, a comprehensive package growth, we have set for ourselves other
the balance sheet strength. of remedies (sale of production assets to strategic objectives that will help sustain
unrelated competitors) was offered covering our business in the future.
Despite some stress in the domestic debt
all the areas of concern highlighted by the
markets, we extended the Company’s debt Alongside growth, we are also focussed
Commission. The remedies offered were
maturity profile by successfully raising on consolidating our position as a global
developed considering the overall industrial
₹4,315 crore through non-convertible cost leader and are taking several initiatives
strategy for the proposed joint venture,
debentures with a maturity of 15 years. in this direction, including driving
the integrated and complex nature of the
We also put in place a 12-year long-term digitalisation across several processes
supply chain to service customers and the
take-out financing for ₹15,500 crore at and functions, structural cost take-out
need to build a sustainable business that
Tata Steel BSL Limited. The changes in the programmes through our improvement
would be able to endure the structural
financial risk profile of the Company are programmes, enhancing employee
challenges faced by the European steel
reflected in the upgrade of our credit rating productivity and investing in logistics
industry. However based on the adverse
by Moody’s from ‘Ba3’ to ‘Ba2’ with positive and supply chain efficiencies. We are also
feedback received from the European
outlook in February 2019 as well as in the investing in our mining operations both
Commission, both parties decided not
revision in outlook by S&P in April 2019. from capacity enhancement and cost
to pursue the transaction as any further
efficiency perspectives.
commitments or improvements to the
Q: Tata Steel has also ventured into the Q: Tata Steel has recently entered Q: What steps are you taking to meet
new materials business. What benefits into the steel recycling business. your strategic objective of being an
do you see from this business? How would you align this with your industry leader in Safety, Health and
strategic objectives and what change Environment (SHE) and Corporate
We are harnessing the power of emerging
do you expect this business to bring in Social Responsibility (CSR)?
technologies and processes in material
the way you conduct your business?
sciences to create sustainable solutions for Acting with responsibility towards planet
end product use in the coming decades. As one of the leading and pioneering Earth, ensuring the health and safety of
We recognise that investment in technology steelmakers, it is our responsibility to people at all our workplaces, balancing
and innovation is a prerequisite for a protect and preserve the planet for future economic prosperity, and generating social
sustainable future. generations. Globally, we are moving from benefits for the community are the rules by
a linear business model towards a circular which Tata Steel operates.
At Tata Steel, we are keen to find innovative
economy. Reduce, reuse and recycle is
solutions to the way we conduct business We understand that health and welfare of
the new way to drive optimal resource
and have embarked on a journey to our people, the community and society,
efficiency. The steel industry is an integral
become a technology leader not only as a whole, is intrinsic to our approach to
part of the circular economy and we have
in the steel but also in the materials business and hence, we persevere to create
a vision to be an active participant in the
business. Moving beyond steel, we have a safe and healthy environment for all
circular economy. Steel is 100% recyclable
set up a new business vertical that will employees and stakeholders and to be an
material and can be used repeatedly to
explore the possibilities of entering the industry leader in SHE and CSR. We aspire
create new steel products, without losing
non-steel materials segment. We are to achieve this objective through enhanced
the inherent properties of steel. This helps
focussing on composite materials such focus on reducing unsafe incidents at the
reduce the use of natural resources as well
as Fibre Reinforced Polymer (FRP), a workplace and reducing carbon emissions
as leads to low CO2 emissions.
light and corrosion-resistant, structural and consumption of depleting natural
material similar to steel. Our focus in the Tata Steel has always been committed to resources.
new materials business will be to cater sustainable growth, which includes our
To contribute towards the socio-economic
to four sectors i.e., the railway, industrial responsibility towards its customers as well
development of the areas where we
goods, infrastructure and automotive as towards the environment. In preparing
operate, we undertake various CSR
sectors. We believe our product offering for the future, Tata Steel has set up a steel
initiatives in the areas of health, education,
will be of high quality, cost effective and recycling business to meet the growing
livelihood, sports and infrastructure
bring superior value to our customers in demand for steel in a sustainable manner
development with indigenous communities.
these sectors, consequently giving us a in the long run. The steel recycling business
We have partnered with various
differentiated and leadership position in the will help formalise the scrap market in India
organisations to work for the upliftment
market in the coming years. and help the country transition to a scrap-
of our communities and will continue to
based steelmaking route in the long term.
deepen our engagement with communities,
with an aim to touch more than 2 million
lives by 2025 through our CSR initiatives.
11
We
Seize
New opportunities
We were the first to acquire a major stressed asset under the
Insolvency and Bankruptcy Code. The acquisition of Bhushan
Steel Limited, now renamed as Tata Steel BSL Limited, has
significantly expanded our footprint in India and will be
value-accretive going forward.
5.6 MnTPA
Total capacity of Tata Steel BSL Limited
ORGANISATIONAL OVERVIEW
Vision Values
We aspire to be the global steel industry benchmark Integrity
for Value Creation and Corporate Citizenship. We will be fair, honest,
transparent and ethical in our
We make a difference through; conduct; everything we do
must stand the test of public
scrutiny.
Our Excellence
Our Our Our Our
Innovative
People Offerings Conduct Policies We will be passionate about
Approach
achieving the highest
standards of quality, always
promoting meritocracy.
Unity
We will invest in our people
and partners, enable
continuous learning, and
build caring and collaborative
relationships based on trust
and mutual respect.
Responsibility
We will integrate
environmental and social
principles in our businesses,
ensuring that what comes from
Mission the people goes back to the
people many times over.
Consistent with the vision Tata Steel recognises that
Pioneering
and values of the founder while honesty and integrity are
Jamsetji Tata, Tata Steel essential ingredients of a strong We will be bold and agile,
strives to strengthen India’s and stable enterprise, profitability courageously taking on
industrial base through provides the main spark for challenges, using deep
effective utilisation of staff and economic activity. Overall, the customer insight to develop
materials. The means envisaged Company seeks to scale the innovative solutions.
to achieve this are cutting heights of excellence in all it does
edge technology and high in an atmosphere free from fear,
productivity, consistent with and thereby reaffirms its faith in
modern management practices. democratic values.
15
PRODUCTS AND MARKETS
Auto OEMs* Hot-rolled (HR), Cold-rolled (CR), Panel and Tata Steelium (CR),
B2B Coated Sheets, Steel Coils and Sheets Appliances, Galvano (Coated),
Fabrication and Tata Astrum (HR),
Auto Ancillaries HR, CR, Coated Steel Coils and Sheets, Capital Goods, Tata Structura (Tubes)
B2B B2ECA Precision Tubes, Tyre Bead Wires, Spring Furnitures
Wires, Bearings B2ECA
LPG HR
B2B
Our footprint
We are primarily involved in the business of mining,
steelmaking and downstream value-added products
and solutions. Our operational footprint has been
indicated on the map.
S
S
MANUFACTURING S
LOCATIONS
19
Jamshedpur 12
Flat Product 7 MnTPA 4 S 11
10
S
DOWNSTREAM OPERATIONS
1 Jamshedpur Tubes
Manufacturing and
Tinplate S
2 Tarapur
3 Pithampur Wire Manufacturing
4 Killa
5 Kharagpur Bearings
Manufacturing
17
APPROACH TO VALUE CREATION
• Focus on strengthening • Ensure seamless • Focus on reducing leverage • Expand downstream product
footprint in India – Best completion of through higher operating portfolio: ~30% of total
positioned to leverage capacity expansion at cash flows, monetisation of volume from downstream
growth opportunities in Kalinganagar by 5 MnTPA non-synergistic ventures and products
India strategic restructuring
• Focus on ramping • Focus on Services and
• Enable growth without up of Tata Steel BSL, • Maintain well-spread debt Solutions portfolio: ~20% of
increasing leverage downstream value maturity profile revenue by 2025
addition, growing long
• Derive cost effectiveness • Grow beyond steel – Focus
products portfolio and
through structured on new materials: ~10% of
driving system synergies
continuous improvement revenue by 2025
from acquisitions
programmes such as
• Create a sustainable Shikhar25
business in Europe
19
BUSINESS MODEL
Intellectual Capital TATA CODE OF CONDUCT POLICIES THAT GOVERN OUR BUSINESS PIONEERING
Collaborations/memberships 40
(Technical Institutes)* (Nos.)
Patents filed* (Nos.) 1,058
R&D spend (` Cr.) 216
Human Capital
Employees on roll (Nos.) 32,984
Investment in employee ~133
training and development (` Cr.)
Employee training 7.52
(mandays/employee/year)
Natural Capital
TSL - Energy intensity (Gcal/tcs) 5.82
TSL - Specific water 3.5
consumption (m3/tcs)
Panview of Jamshedpur Steel Plant
Captive iron ore (%) 100
Captive coal (%) 27
Inbound raw materials (MnTPA) ~ 40 Tata Steel Value Chain
Capital spend on environment (` Cr.) 286
distributors (Nos.)
Application engineers working 43
jointly with customers (Nos.) PROCESSED RAW
MATERIAL
Customer-facing processes (Nos.) 11 ROLLING
Customer service teams (Nos.) 25 IRON MAKING STEEL MAKING (FLAT AND LONG
PRODUCTS)
Supplier base (Nos.) > 5,000
CSR spend (` Cr.) 315
BY-PRODUCTS PRODUCTS
MINING
OUTPUTS OUTCOMES
21
We
Lead
In cost competitiveness
Operational efficiency is a key strength of Tata Steel. Over
the last one-and-a-half decades, Tata Steel has designed and
implemented several distinctive improvement programmes
that have brought many of our performance parameters to
benchmark levels. This continued focus on maintaining our
leadership in cost competitiveness has resulted in significant
increase in our EBITDA.
₹20,744 Cr.
EBITDA
31%↑
(y-o-y)
STRATEGY
Roadmap to future
As part of our strategy planning process, we scan the external environment for
megatrends and understand how these trends influence the steel sector. We identify the
risks and opportunities that could disrupt the industry. Materiality assessment provides
further insights to the changing needs of all our stakeholders.
Our integrated strategy planning process drives strategy formulation
and implementation across the short to long-term horizon.
STRATEGY
DEPLOYMENT
Long-term Plan
While Tata Steel has consistently been one of the most profitable and lowest cost producers of steel1 in the world, the
Company needs to address challenges such as improving productivity, maintaining cost competitiveness, and being
agile and innovative in a rapidly evolving business environment.
Tata Steel aspires to further strengthen its leadership position, and for this purpose, has defined a set of Strategic
Objectives (SOs). To achieve the SOs, we have also identified a set of core capabilities, known as ‘Strategic Enablers’.
Strategic Objectives
SO1 SO2
INDUSTRY CONSOLIDATE
LEADERSHIP POSITION AS A
IN STEEL GLOBAL COST LEADER
Scale of operations is a We aspire to be a global benchmark
pre-requisite for steel in operational efficiency, ensure raw
industry leadership. material security and strengthen
our logistics network.
SO3 SO4
INSULATE REVENUES INDUSTRY
FROM STEEL LEADERSHIP
CYCLICALITY IN CSR AND SHE
The steel industry is cyclical in We aspire to be a leader in
nature. It is essential to build a sustainable business practices.
portfolio of products and services As a responsible organisation,
that can provide protection from we are committed towards
cyclicality and lend stability creating and providing a
and momentum to our revenues safe working environment
and profitability. for our people, carrying out
environment-friendly business
operations and improving
the quality of life of the
communities
we operate in.
Strategic Enablers
1
Comparison of cost is done at crude steel level
25
STRATEGY (Continued)
SO1
SO2
• Continue to invest in raw material • Captive coal (%) and Captive iron ore (%) Maintain cost leadership at
security market price of raw materials
• Cost improvement and value • Value accrual Improved cost and value
enhancement through Shikhar25 enhancement
continuous improvement programmes
SO1 - Industry leadership in steel SO3 - Insulate revenues from steel cyclicality
SO2 - Consolidate position as a global cost leader SO4 - Industry leadership in CSR and SHE
SO3
• Services & Solutions business • Revenue (% of total revenue) Increase revenue from services and
solutions business
• Downstream products (e.g. Cold Rolled, • Volume (% revenue) Improve downstream products business
Tubes, Wires, Bearings)
• B2C Business • Volume (% revenue) Enhance volume in B2C business
• New materials business • Revenue from new materials Increase revenue from new materials
(% of total revenue) business
SO4
INDUSTRY LEADERSHIP IN CORPORATE SOCIAL RESPONSIBILITY AND SAFETY HEALTH & ENVIRONMENT
• Achieve leadership in safety • Fatality, Lost Time Injury Frequency Rate Zero fatality
(LTIFR)
• Become a benchmark in CO2 emission • CO2 emission intensity < 2tCO2/tcs by 2025
• Reduce water consumption • Specific water consumption Zero effluent discharge by 2025
• Create value through circular economy: • % of LD slag utilisation and Capacity (MnT) Sustain LD slag utilisation at 100% and
LD slag utilisation and steel recycling of scrap recycling business enhance capacity of scrap recycling
business business
• Create lasting impact on the
communities in our operating areas
• Number of lives impacted >2 Mn lives by 2025
27
STAKEHOLDER ENGAGEMENT
Value proposition
We have a robust stakeholder
engagement process to foster Consistent returns on Strong brands, quality products, Building capabilities through
and nurture relationships, which investments and innovation and engineering support skill development, growth
helps improve our strategy for a sustained business opportunities, safe operations
development and decision and adequate financing
making. We are working towards
delivering on stakeholder needs, Why they are important to us
interests and expectations. Our investors provide the Customers drive the markets Our partners give us the
In Financial Year 2018-19, necessary financial capital, and segments we operate in. operational leverage to
we conducted a pan‑India which is essential to fund Meeting customer expectations optimise the value chain, be
stakeholder engagement business and strategic growth underpins the success of our cost competitive and exceed
exercise to revisit the ESG plans business customer expectations
issues that are material to our
value-creation process amid the
evolving global sustainability
landscape.
How we engage with them
Investor and analyst meets Customer service meetings Vendor satisfaction survey
General meetings Multi-stakeholder platforms Vendor Capability
Advancement Programme
Annual Report and media • Conferences
updates on performance Vendor Grievance Redressal
• Construction conclaves
Committee, Speak UP
• Zonal and similar meets Toll-free number
Workshops and meets
Fair wages, good relations and Enabling significant and lasting Advocacy towards shaping Sharing industry best practices
employee well-being betterment in the well-being of policies for the future and benchmarks
communities proximate to our
operating locations
Our employees are key to the Thriving and engaged We are in a highly regulated Media is an important platform
success of our business. Their communities in our areas of industry. We strive to maintain to reach out to society and
efforts are instrumental in operations are vital to our our compliance standards communicate about our brand
delivering our strategies and business. Our social license to above regulatory requirements. Industry bodies are important
for the sustained growth of operate hinges on our ability to We co-develop and comply fora to engage with regulatory
our business create value for our community with legislations and policies bodies and discuss matters of
applicable to our business to mutual interest
ensure continuity
Monthly online meet with the Public hearings Representations at relevant Press conferences, media
CEO & MD and informal meets ministries and regulatory events
Meetings with community
with the senior leadership authorities at the central and
leaders and the CSR Advisory Regional and national
state levels
Employee engagement survey Council events such as conclaves and
conferences of industry bodies
Employee happiness study Community welfare
programmes Senior leadership are part of
Joint forums between
various industry bodies and
employee unions and
committees
management
Internal communications
Talent retention Better healthcare facilities Carbon emission, energy More frequent and transparent
Local sourcing of labour Water scarcity in the efficiency and waste disclosures on sustainability
community areas management issues such as water, health
Welfare practices for
More focus on education in and safety, energy efficiency
non‑officers Livelihood generation and skill
community development measures
development
Setting trends for future More participation in events
regulations and going beyond and engagement with media
compliance
29
MATERIAL ISSUES
G3 G5 S3 G4 E4 E3 E5
HOW WE IDENTIFIED
MATERIAL ESG ISSUES S4 E6 E8 G6 E7
E3 Water consumption and Striving towards future readiness by investing in sewage treatment plants and creating new
effluent discharge rain water harvesting structures
E4 Energy efficiency Focus on energy efficiency through process optimisation initiatives such as waste heat
recovery systems and by-product gas utilisation
E5 Air pollution Investment in air pollution control equipment to reduce dust emission intensity
E6 Supply chain sustainability Embedding sustainability across the supply chain
E7 CO2 emission Piloting Carbon Capture and Use (CCU) at Jamshedpur works and at the Ferro-Chrome plant,
and assessing renewable energy potential across all locations in India
E8 Biodiversity Reclamation of mining activities
E9 Circular economy Adoption of circular economy concepts to maximise the utilisation of our by-products
Social
Strategic Objectives S1 Occupational health & safety Leadership capability development for safety at all levels to achieve zero harm
Identification and mitigation of hazards and risks
SO4
Reduction in safety incidents on road and rail to sustain zero fatalities inside plant premises
Capitals Impacted Excellence in Process Safety Management (PSM)
Establishment of industrial hygiene and improvement in occupational health
S5 Talent retention Development of workforce capability through various programmes and fostering a diverse
workforce through our MOSAIC framework
Governance
Strategic Objectives G1 Going beyond compliance Collaborations with technical institutes and technology start-ups
and setting trends for future
SO1 SO3 regulations
SO4 G2 Greater stakeholder engagement Enhancement of specialised channels such as public meetings, vendor-focussed committees, Speak
UP toll-free number, platforms such as conference and construction conclave, zonal and similar events
Capitals Impacted
G3 Greater sustainability disclosures Consistent improvement of our disclosures through GRI, <IR>, worldsteel and BRR frameworks
G4 Technology, product and Process innovation such as High Gradient Magnetic Separator (HGMS) for iron ore slime
process innovation beneficiation
Product innovation such as Pravesh Vista steel windows and graphene-doped plastic products
G6 Responsible advocacy for the steel Engaging with the industry bodies and peer networks in sharing best practices, training,
and mining sector research and ideas that enhance the overall performance of the industry
Contraction in global and Tata Steel is deleveraging through internal cash generation SO1 SO2
domestic liquidity adversely and monetisation of non-synergistic assets. We have a
affecting availability and cost well‑diversified liability profile and we raise funds from
of capital domestic and international bond markets as well as from the Capitals Impacted
banking system. We consistently work towards increasing our
debt maturity and opportunistically tap into pools of liquidity
to reduce our financing costs.
Regulatory risks
Strategic Objectives
Withdrawal of favourable trade Building on the mitigation strategies for macroeconomic SO1 SO2
measures such as minimum and market risks, we continue to invest in stronger customer
import prices, antidumping laws, relationships, distribution networks and brands that focus on
countervailing duties and tariffs, trade value-added segments such as auto and retail, and help to Capitals Impacted
restrictions may impact profitability strengthen our revenue profile.
Stringent regulations and compliances We are investing in training and automated systems for facilitating
resulting in liabilities and damage to our compliances to all applicable regulatory norms. Efforts are
reputation undertaken to improve the efficiency and cost competitiveness of
our operations, including investing in digitisation and automation,
to improve our productivity levels.
Non-renewal of mining leases Tata Steel has sought judicial intervention to secure lease renewals.
compelling higher purchases from We also participate in mining auctions to secure fresh leases.
open market at higher prices, adversely Alternative supply chains are also being developed to source raw
impacting profitability materials at competitive prices.
SO1 - Industry leadership in steel SO3 - Insulate revenues from steel cyclicality
SO2 - Consolidate position as a global cost leader SO4 - Industry leadership in CSR and SHE
Macroeconomic and
steel market risks Mitigation strategies Strategic Objectives
Slowdown in global growth, particularly Tata Steel is enhancing its footprint in India, which is among the SO1 SO3
in China, adversely affecting steel fastest growing steel markets in the world. We have built a strong
demand marketing franchise through strong brands and relationships,
Increasing competitive intensity in India, which helps reduce exposure to business cycles. Capitals Impacted
especially post the acquisition of steel As a preferred supplier to large auto customers in India, a large
assets by international steel producers part of our sales is contractual and relatively more stable. We have
under the Insolvency and Bankruptcy a large retail business that leverages an extensive network of
Code, 2016 over 200 distributors and 12,000+ dealers and a strong portfolio
Technology disruptions and shifting of brands to sell branded steel across the country. This segment
customer preferences to alternative is relatively insulated from the international cycles and provides
materials adversely impacting earnings strong cash flows. We have a significant downstream portfolio and
are also exploring new segments such as oil & gas.
Operational risks
Strategic Objectives
Inadequate assessment of health of Our dedicated Shared Services team focusses on advanced SO1 SO2
critical equipment leading to unplanned maintenance practices to improve plant availability and reliability.
interruption of operational processes We have a dedicated R&D team that deploys innovative ways to
Non-disposal of plant waste due to reduce waste generation and commercialise alternative uses of Capitals Impacted
limited demand and storage space waste material.
Logistics constraints due to inadequate Tata Steel is working on developing logistics providers under
rail, road and sea infrastructure may various schemes of private sector participation in the Indian
lead to disruption in operations Railways, apart from developing additional deep sea ports and
contracting with terminal owners at existing ports.
Non-compliance/delay in Tata Steel has a strong safety management system that covers SO4
implementation of the provisions of employees, contractors, rail and road transport, equipment safety
safety laws and regulations, which may and emergency response. Regular audit and review of the safety
lead to stoppage of operations, damage measures are undertaken. Periodic safety trainings are conducted Capitals Impacted
to assets and loss of reputation for employees, contractors and other relevant stakeholders.
Safety is a KPI for all employees in their performance management
system.
33
RISKS AND OPPORTUNITIES (Continued)
Community risks Mitigation strategies Strategic Objectives
Communities proximate to our We are deeply committed to co-creating scalable solutions for SO4
operations live through significant the most endemic development challenges of our communities.
socio-economic challenges while We impact more than a million lives every year through proven
retaining a strong cultural heritage programmes on health, education, livelihood generation, Capitals Impacted
and an aspiration to overcome public infrastructure and basic amenities. Tata Steel has a deep
these challenges. The absence of engagement with the tribal community and actively promotes
an understanding of this duality in cultural and ethnic diversity.
our communities and an inability to
We also recognise the rich tribal heritage at our operating
maintain a harmonious relationship with
locations and foster a relationship with our communities where we
them would pose risk to our operations
celebrate their history, culture and tribal identity.
Raw material price volatility is an Steel prices have a strong correlation with commodity prices. SO1 SO2
integral part of operations Rising coal and iron prices are normally reflected in higher steel
Supply chain disruptions affecting prices, which in effect act as a hedge against volatility.
availability and cost of raw materials Capitals Impacted
In India, our captive iron ore mines as well as coal mines enable
Tata Steel to partly derisk price volatility in these commodities.
In addition, we hedge certain commodities in the derivatives
market to address short-term volatility.
Geographical and vendor diversification of critical commodity
supplies help alleviate the risk of supply chain disruption. We
have started conducting a sustainability risk assessment for our
key vendors.
Breach of information security incidents Significant efforts have been made to increase awareness and SO1 SO2
leading to business disruption and invest in IT security and related compliances. Tata Steel has also
damage to reputation invested in cyber insurance.
Non-compliance to IT legislations and Capitals Impacted
regulations leading to penalties
Non-compliance to stringent Tata Steel continues to invest in upgrading existing technologies SO4
environmental conditions leading to to minimise its environmental footprint. We closely monitor air
penalties, stoppage of operations and quality, effluent discharge and other environmental parameters
loss of reputation to ensure that they comply with all existing regulations. The focus Capitals Impacted
Climate change related regulations and on minimising carbon footprint is integrated within the capital
extreme weather events may disrupt allocation process and projects are required to calculate a carbon-
operations and supply chain adjusted Internal Rate of Return (IRR).
As a signatory to Task Force on Climate-related Financial
Disclosures (TCFD), Tata Steel is actively working to understand
the broader impacts of climate risks across its value chain and is
exploring avenues to fundamentally reshape the business to make
it both environmentally and economically sustainable in the
long-term.
34 INTEGRATED REPORT & ANNUAL ACCOUNTS 2018-19 | 112TH YEAR
STRATEGIC REPORT | 1-88 STATUTORY REPORTS | 89-194 FINANCIAL STATEMENTS | 195-418
Capitalising on opportunities
Tata Steel has a continuous process of understanding and leveraging business opportunities.
India’s apparent steel use per capita stood at 70 kg in With higher aspirations and affordability of a growing
2018, which is only one-third of the world average. This middle class, consumer needs are evolving. Along with new
indicates that India has a huge potential for steel demand products, there is growing need for Services & Solutions
growth. Rapid urbanisation, increasing population, and that provide convenience. The demand for automobiles,
infrastructure development, Government initiatives such as white goods and other consumer goods is also increasing.
‘Make in India’ will provide impetus to the growth in steel Meeting this need will require new and value-added steel
demand. products. Tata Steel will leverage this opportunity enabled
by innovative Services & Solutions offerings for consumers
The plan for building smart cities, affordable housing,
and a strong new product portfolio.
dedicated freight and high-speed rail corridors is expected
to create significant demand for steel in the country. With
leadership position in key market segments and world-class
production facilities, Tata Steel is well poised to benefit
from this large opportunity.
Steel is an energy-intensive industry with a high level of With the growth in the economy, there is a large opportunity
CO2 emission. There is growing regulatory requirement to for new materials and applications for existing and new sectors.
reduce carbon emission. Tata Steel Jamshedpur is a national Tata Steel aspires to be a technology and innovation leader
benchmark in CO2 emission. There is further opportunity for in the industry, and create new businesses in high-potential
Tata Steel to take a leadership role in reducing environment alternate materials (e.g., FRP composite and graphene). These
footprint. The Company has ventured into the steel new businesses are expected to contribute 10% of our revenues
recycling business to establish an alternate business model, going forward. Along with new and enriched revenue streams,
leveraging the expected increase in availability of scrap in technology leadership will also enable Tata Steel to innovate,
India, going forward. Environment-friendly business models maintain cost leadership as well as provide differentiated
such as these are expected to make us future-ready and will offerings in existing businesses. There is also an opportunity
be a source of competitive advantage in future. to leverage the innovative potential of start-ups by creating
external collaborations and partnerships. Tata Steel is also
taking steps to capitalise on the large opportunity to move
towards Industry 4.0 through digital-enabled business models.
35
CORPORATE GOVERNANCE
The Company has laid a strong foundation for making corporate Tata Steel’s rigorous approach to Enterprise Risk Management
governance a way of life by constituting a Board, which is active, (ERM) enables the Management to protect and enhance the value
well informed and independent, using several Board Committees as of assets, people, performance and reputation. To manage risks
a mechanism for managing the affairs of the Board. throughout our value chain, we have a robust risks management
framework in place across the organisation, overseen by the Risk
With regulations becoming more stringent on the domestic Management Committee at the Board level.
as well as international fronts, our policies and the Tata Code
Sustainability is embedded in our business operations. We aspire to
of Conduct (TCoC) are implemented to ensure that business is
be an industry leader in sustainable business practices. To prepare
conducted ethically and responsibly, through a well-defined ethical
for the future, we are taking steps to reduce our environmental
governance framework.
footprint and contribute towards the creation of a circular economy.
A benchmark for
business ethics
Recognised as one of the World’s Most
Ethical Companies by Ethisphere in
2019, for the eighth time and the only
Indian company to win the award in the
Metals, Minerals and Mining sector.
Mr. T. V. Narendran, CEO & MD, Tata Steel and Principal Ethics Officer, addressing
the delegates at Tata Network Forum India East - Ethics Conclave FY 2018-19
Corporate ethics
We, at Tata Steel, are driven by the Group’s core values enshrined in
the Tata Code of Conduct (TCoC).
The TCoC is deployed across the organisation through a formalised
Management of Business Ethics (MBE) structure, which is built on
the foundation of Tata Core Values — Integrity, Excellence, Unity,
Responsibility and Pioneering — and functions on the basis of
four pillars:
1 Leadership
Engagement
3 Communication
and Training
2 Compliance
Structure
4 Measurement of
Effectiveness
1 Leadership Engagement
Tata Network Forum India East - Ethics Conclave FY 2018-19 Brand where Ethics makes a Difference
37
CORPORATE GOVERNANCE (Continued)
2 Compliance Structure
3 Communication and Training
This pillar focusses on the Policies supporting TCoC: Communication and training programmes have been designed
development and dissemination to raise awareness of Tata values, TCoC and ethical policies
of policies supporting the Whistle-Blower Policy for and practices among all stakeholders. The senior executives
TCoC for all stakeholders. Directors, Employees and communicate on various forums, such as Group Ethics Conclave,
All employees are required Associates Ethics Town Hall and MD Online, to keep up with the ethical
to read and accept the TCoC benchmark at Tata Steel and its group companies.
and declare their Conflict of Receipt of Gifts and
Hospitality For effective dissemination to the frontline and contractual
Interest (COI) status through
employees, local languages are also used in communications. To
the ‘Ethics Compliance Register
Prevention of Sexual help people relate with practical situations, snippet stories, ‘Neeti
– DARPAN’, accessible on the
Harassment Policy at Katha’, with various dilemma scenarios were introduced. In Financial
Company’s intranet and mobile.
Workplace and Guidelines Year 2018-19, scenarios on ‘The Ethics of Safety’ and ‘Trust
To encourage and protect
Behaviour’ were communicated.
whistle-blowers, the toll-free
third-party helpline ‘Intouch’, Conflict of Interest Policy The senior executives communicated with vendors and suppliers
popularly known as ‘Speak Up’, during regular Business Associate’s (BA’s) meets/dialogues. They
maintained by an independent also accept the TCoC and declare their COI during the registration
UK-based company, has been Tata Steel has always been process.
extended to all stakeholders. committed to creating a positive
The Chief Ethics Counsellor business ecosystem in all the
reports the performance of spheres it operates. We are in
4
MBE deployment, including the process of developing the
Measurement of Effectiveness
TCoC violations, to the Board Anti-Bribery & Anti-Corruption
level (Audit Committee) and and Anti-Money Laundering
Management level committees (ABAC/AML) policy, which will To assess the level of deployment of various MBE initiatives across
(Apex Ethics Committee and strengthen our internal and the organisation, an MBE assessment framework was developed
Ethics Committee). external processes against involving site assessment, which resulted in increased cross
financial risks. learnings between DECs and improved MBE deployment. The MBE
survey and assessment by the Tata Business Excellence Group were
also conducted in Financial Year 2018-19.
In Financial Year 2018-19, we conducted a benchmarking exercise
with GoodCorporation and General Electrics, apart from sharing
ethical practices in various international forums such as the Business
Ethics Leadership Alliance (BELA) summit and the Ethisphere
Summit.
436 Received
Total
334 102
Closed Open 20 Received
Total
19 1
Closed Open
Officers
4,003
Frontline
Employees
7,080
Contract
Employees
23,798
Vocational
Training
1,999
* exclusive of sexual harassment cases
Corporate sustainability
Tata Steel is committed to incorporating sustainability into all facets of
its business, from governance to strategy formulation to execution. The
performance related to various sustainability aspects is reviewed at the
corporate as well as the Board level.
The scope and membership of Board-level committees has Our senior leaders actively engage with various industry bodies
been detailed in the Corporate Governance Report. At the such as the World Steel Association, the Confederation of Indian
corporate level, various committees review the sustainability and Industry (CII), the Global Reporting Initiative, the International
governance initiatives. These include the Apex Safety Committee, Integrated Reporting Council and the Task Force on Climate-
Apex Environment Committee, Apex HRD Committee, Apex CSR related Financial Disclosures, guiding the Company further
Committee, Apex R&D Committee and Quality and Production on implementing sustainability practices. Various external
Meeting and Centre of Excellence for GHG emission reduction and assessments such as the Dow Jones Sustainability Index and
mitigation. These Committees are chaired by the Chief Executive those conducted by the CII drive improvements in our efforts of
Officer and Managing Director or the Executive Director and Chief embedding sustainability.
Financial Officer or Vice President Safety, Health & Sustainability.
Tata Steel has entered into a partnership with the Cambridge
The climate change-related risk assessment in accordance with Institute for Sustainability Leadership for capability development
the Task Force on Climate-related Financial Disclosures has through an immersion programme for Board Members, Senior
been initiated and mitigation strategies will be incorporated Management and Union Leadership.
subsequently.
Sustainability Immersion Programme for Board Members and Senior Leadership by Cambridge Institute for Sustainability
Leadership, UK
39
OUR CAPITALS
We generate financial capital in the form We continuously invest in our Our focus on innovation and research
of surplus arising from current business integrated steel plants, our iron-making, reinforces our drive for operational
operations as well as through financing steel‑making and rolling facilities efficiency and resource optimisation,
activities, which include restructuring of and warehouses, along with logistics while adhering to the Standard Operating
debts aligned with market conditions and operations, while ensuring the safety Procedures. We incorporate customer
other investments. and reliability of our operations. requirements in our product development,
while also collaborating with experts for our
Research and Development efforts.
Our people form the core of our We depend on natural resources such Our communities, customers and
operations. We invest in employee as iron ore, coal and other minerals, suppliers are critical to our social license
welfare and happiness to drive which constitute our key raw materials. to operate and business continuity.
performance excellence. Our work At the same time, land and water are We believe in building long-term,
culture ensures safety, health, indispensable for our operations. We transparent and trust-based relationships
competency enhancement, and the strive for excellence in environmental with them through continuous
overall well-being of our employees. performance and resource efficiency to stakeholder engagement and innovation.
mitigate our ecological footprint.
41
Financial
capital Cash Generated from
Operations
0.42
At Tata Steel, we endeavor to
optimise returns for providers
of financial capital. We seek to Basic EPS
maximise surplus funds from both
business operations as well as
relevant monetisation of assets
₹ 90.41
and investments.
We are seeking to invest our
surplus in attractive growth
opportunities in our core
market. We also continue to
opportunistically raise finance
based on prevailing market
conditions at the best possible
cost and on suitable flexible terms
given the cyclical nature of the
steel industry.
STRATEGIC REPORT | 1-88 STATUTORY REPORTS | 89-194 FINANCIAL STATEMENTS | 195-418
SO1 - Industry leadership in steel SO3 - Insulate revenues from steel cyclicality
SO2 - Consolidate position as a global cost leader
43
FINANCIAL CAPITAL (Continued)
Key initiatives
As per our strategic priorities, we are focussed on deleveraging and
enhancing cash flows.
Reinforcing shareholders’ trust
• During the second half of Financial Year 2018-19, post acquisition Moody’s Investors Service has upgraded our Corporate Family
of Tata Steel BSL Limited, we took steps to deleverage the balance Rating (CFR) to Ba2 from Ba3. The Company’s CFR is supported
sheet at the Tata Steel group level to the tune of ₹17,864 crore. by its significant, diversified and growing operating base as
• Despite some stress in the domestic debt markets, we extended well as its globally cost-competitive steel operations in India.
our debt maturity profile by successfully raising ₹4,315 crore
through non-convertible debentures with a maturity of 15 years.
• The Board has recommended dividend at ₹13 per Fully Paid Share
and ₹3.25 per Partly Paid Share, which is higher as compared to
previous years.
Operational achievements
During the year under review, the Company achieved strong operational performance due to supportive realisation,
cost reduction initiatives, and increase in deliveries owing to faster ramp-up of the Kalinganagar plant.
29.38
23.14
26.11
24.18
22.44
16.53
15.84
18.25
11.38
7.48
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
Return on Average Capital Employed (%) Return on Average Net Worth (%)
16.26
15.43
13.10
9.73
9.80
8.41
7.21
6.83
5.57
1.89
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
0.50
0.44
0.42
38.57
0.40
0.15
8.05
31.74
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
45
Manufactured
capital Acquisition of
Bhushan Steel
SO1 SO2
Achieve production capacity
Efficient operations and value chain are critical to meet growth
aspirations and address the evolving needs of customers.
of 30 MnTPA in India, by 2025
We continue to invest in facilities that enable us to be a leader in
steel technology. Maintain cost leadership
position
WAY FORWARD
TSJ is our flagship facility and has been operational for over a century Availability of
now. Equipment upgrades and effective maintenance ensure critical manufacturing
consistent production levels of 11 MnTPA. Equipment upgrades units at TSJ in Financial
include the installation of a new boiler, which will enable 100% use of Year 2018-19
off-gas from blast furnaces, installation of Coke Dry Quenching (CDQ) Coke Ovens
99.8%
facilities, modification of Induration Burner System to utilise excess
coke oven gas, and installation of edge trimming facility for the
Galvanised Annealed (GA) skin panel. Further, various environment-
Blast Furnaces
related projects were completed in Financial Year 2018-19, which
include the installation of the blast furnace dedusting equipment,
lime plant process bag filter, Continuous Emission Monitoring
97.3%
Systems (CEMS) highline bag filter, blast furnace sludge drying, Agglomerates
secondary emission system for steelmaking, and construction of a
flyover to decongest traffic within the facility. These changes have
94.1%
helped us sustain production levels, drive resource efficiency, and Steelmaking
progress towards meeting stringent environmental norms. Our focus
on asset management using data analytics and predictive modelling, 93.7%
has resulted in more than 90% availability of our key manufacturing Capacity
Coke Dry Quenching Facility,
10 MnTPA
units at Jamshedpur.
Tata Steel Jamshedpur
SO1 - Industry leadership in steel
SO2 - Consolidate position as a global cost leader
47
MANUFACTURED CAPITAL (Continued)
5 MnTPA
augment our product portfolio to serve new customer
segments such as oil & gas and lifting & excavation. The
expansion of the Kalinganagar plant to 8 MnTPA (TSK
Phase II) has been initiated, which will further improve
performance due to economies of scale. Phase II Expansion Work at Kalinganagar
Steel Plant
2 5
3 4
OUTBOUND LOGISTICS
INBOUND LOGISTICS
PROCESSED RAW
MATERIAL
IRON MAKING STEEL MAKING ROLLING PROCESSING CUSTOMERS
1 (FLAT AND LONG CENTRES
PRODUCTS)
BY-PRODUCTS PRODUCTS
MINING
Operational excellence maximising TSJ & TSK - Coke rate* (Kg/tonne of hot metal)
434
399
380
360
352
348
Coke rate is an important operating KPI for an integrated steel plant,
impacting cost, CO2 emission and energy intensity. At Tata Steel, we
aim to reduce the coke rate in our blast furnaces while optimising
our raw material cost. In Financial Year 2018-19, the coke rate at our
Kalinganagar plant improved significantly from 434 kg/tonne of hot
metal to 399 kg/tonne. The combined coke rate and energy intensity FY15 FY16 FY17 FY18 FY19
for Jamshedpur and Kalinganagar in Financial Year 2018-19 was
TSJ TSK
363.15 kg/tonne of hot metal and 5.82 Gcal/tcs, respectively.
BUILDING SUPPLY CHAIN EFFICIENCY TSJ & TSK - Energy intensity (Gcal/tcs)
Good
Supply chain management is key to the operations of an integrated
8.49
5.77
5.67
5.67
~ 10%
Targeted size of revenue
from new materials by 2025
Intellectual
capital R&D spend
and digitalisation 72
Tata Steel aspires to be a pioneer
in leading the fourth industrial
revolution and is committed
to developing cutting-edge New products*
launched
technologies, and design solutions,
that help transform processes,
leverage digital technology to
114
improve efficiencies, and enhance
customer experience.
* New product is defined as product developed at
Tata Steel through new processes and technology
and then commercialised
STRATEGIC REPORT | 1-88 STATUTORY REPORTS | 89-194 FINANCIAL STATEMENTS | 195-418
SO3
To be one of the top five
Technology and a culture of continuous improvement are key
enablers towards achieving the strategic objectives of industry
technologically advanced
leadership and cost leadership. global steel companies
53
INTELLECTUAL CAPITAL (Continued)
Our R&D function has over 200 In-house platforms such as Innovation council led by R&D We have set up enhanced
researchers and collaborations Innovent support our strong aims to generate novel ideas research facilities with latest
with 40 institutes. culture of innovation. Innovent and enable implementation. laboratories such as APERTA
focusses on identifying key New collaborations as well as (Thermochemical Simulation),
customer insights and translates advancements in new materials enGENE (Biotechnology
them into tested and scalable and solutions are some key Solutions), PEARL (Product
business models. outcomes of this process. Forming and Performance
Research), SeFondre
(Welding) and Reynolds
(Mathematical Modelling).
India’s First Fibre Reinforced Polymer (FRP) based Foot Over Bridge Installed at R&D Division, Tata Steel Jamshedpur
Special focus was given to new Graphene Use of High Gradient Magnetic
steel product development for the Graphene-doped plastic products that were Separator (HGMS) for iron
Pre‑Engineered Building (PEB), Lifting used in Tata Steel for industrial use showed ore slime beneficiation
and Excavation (L&E) and Oil & Gas a two-fold increase in life as compared to Currently, the Noamundi iron ore mine
(O&G) segments. The production facility existing products. discards 16% of wet run of mine output
at Kalinganagar helped develop new as slime, which has 8% alumina and
products in an accelerated timeline. In- 55% iron content. Implementation of
house R&D efforts, collaboration with Tata HGMS is expected to recover 50% of
Steel Europe and technical institutions slime containing iron content of 63%.
helped us expedite the product and This initiative is in its pilot stage and is
process design for these products. expected to save virgin raw materials
and increase mine life through improved
beneficiation.
55
INTELLECTUAL CAPITAL (Continued)
To drive and sustain transformation of this scale and deploy digital solutions, we have
structurally altered our IT infrastructure spend. We have moved from being capex-heavy
to capex-light by opting for managed services to augment the IT layers of connectivity,
infrastructure and cyber-security.
https://aashiyana.tatasteel.com
With increasing connectivity and We have built and deployed over 40 Advanced Analytics models to Our customer-facing digital
data flow, we are exposed to the enhance operational efficiencies, which include: platforms–Aashiyana, DigECA
risk of new-age cyber crimes. and Compass–have resulted in
• Reduction of ore stickiness in our iron ore mines and turnaround
We have deployed a full-scale additional revenue and continue
time of wagons, leading to lower demurrage
Security Operations Centre to be one of the enablers
(SOC) to safeguard our IT and • Reduction of downtime of apron feeders in improving our customer
Operational Technology (OT) satisfaction.
• Improvement in quality of pellet, coke and sinter to blast furnaces
data and applications, which has
at optimum cost and lower emission, further aided by in-process
the capability to analyse 30,000
hot metal temperature and furnace
events/sec, resulting in proactive
detection and defence from • Permeability prediction models that improve iron making at
cyber threats. reduced coke rates
• Optimisation of the slitting of mother coils to reduce yield loss at
Steel Processing Centers, and reduction of Stock Keeping Units
of Pravesh doors that resulted in improved delivery time for
customers
• Optimisation of our distribution costs
Tata Steel joins the CII led collegium of futuristic business ‘Mind Over Matter’ Programme - Tata Steel’s Annual
houses to pledge support to the start-up ecosystem Innovation Challenge for Engineering Students
Tata Steel leads industry efforts in supporting knowledge transfer Tata Steel collaborates with various technical institutes and
and capability building across and beyond its sector. We have worked technology start-ups/SMEs nationally and internationally to
extensively with the Government and regulators to shape policies create an ecosystem for cross-learning and collaborative working.
that influence the sustained economic growth towards national The collaborative projects range from emerging technologies,
priorities. Our leadership is on numerous committees that engage environment, Artificial Intelligence, robotics and other long-term
in dialogue on issues ranging from environment, financial practices research assignments. These collaborations work in a two-way
to social initiatives and others. Our senior leadership is engaged at a manner where students from institutes work at Tata Steel and
global level to help formulate paths towards Industry 4.0. Tata Steel employees are sent for research fellowships to study at
different universities. Tata Steel is also engaged with government-
Our organisation regularly supports industry bodies and peer
funded research programmes such as Uchhatar Avishkar Yojana
networks in sharing best practices, training, research, and ideas that
(UAY). The Value Analysis and Value Engineering (VAVE) programme
enhance the overall performance of the Indian industry. Events such
is an engagement mechanism where Tata Steel engages with
as annual fraternity meets are held for maintenance communities
customers on topics such as how best to use steel, simulations,
that connect engineers from all locations with the objective of
modelling for light weighting, and optimum material usage.
sharing best practices and achievements.
The senior leadership of Tata Steel is part of various national
Other forums used to promote cross-learning and sharing of best
level research missions such as the Centre of Excellence in Steel
practices are the shared services technical meet and quarterly meet
Technology (CoEST, IIT Bombay) and the Advanced Manufacturing
of experts at Kalinganagar.
Centre at IIT Kharagpur, among others.
Total Quality Management (TQM) is deeply embedded in the ethos the coverage of Shikhar25 and started two new IMPACT centres.
of Tata Steel. It involves all sections of the workforce in driving These IMPACT centres focus on cross-functional themes, digital
improvement projects for enhancing performance. Initiatives for initiatives, new technology, and collaboration with suppliers to
achieving operational excellence have reduced operational cost and identify new avenues for improvement.
environmental impact while delivering higher EBITDA margins.
In addition, we implemented over 34,000 kaizens, 367 green belt
The Shikhar25 programme focusses on delivering superior product projects and over 100 other TQM projects. We achieved 92.6%
quality, optimising product mix, improving operational efficiency to employee involvement in improvement activities. ‘Manthan Ab
lower carbon footprint, reducing waste generation, improving waste Shopfloor Se (MASS)’ is an idea generation initiative for shop-floor
utilisation, and maximising energy and material efficiency. employees, focussing on issues such as safety, cost, operational
excellence, environment, etc.
In Financial Year 2018-19, we successfully implemented 427 Shikhar25
projects, resulting in total savings of ₹2,801 crore. We also increased
57
Human
capital
32,984
Preparing people Employees on roll (India)*
for tomorrow
49%
Reduction in LTIFR
in last 10 years
SE
Improve employee productivity
Investing in people and striving to be employer of choice is an
area of focus for Tata Steel. Creating a safe and healthy workplace
is a key priority. Care for the communities and people we touch in
Be one of the best places for people
our operating areas is embedded in our way of working through to work
our CSR practices.
Zero fatality
WAY FORWARD 25% diversity in workforce by 2025
Continuing to focus on: 2% improvement in health index
Employee engagement | Diversity and inclusion | Leadership year-on-year
development | Employee experience | Zero harm to contract
partners | Upskilling of women across locations | Enabling the
inclusion of PWDs IMPACT ON SDG s
We focus on three thrust areas across the value chain to build and nurture our human capital:
Occupational Health and Safety (OHS) Human Resource Management Human Rights
Being in an inherently hazardous industry, With 32,984 employees, Tata Steel Tata Steel employs and impacts
ensuring the highest degree of physical, continously strives to be an employer of a huge workforce throughout its
mental, and social well-being of the people choice. Diversity within our workforce is of value chain. Any risk of human rights
in and around our plants always remains a paramount importance as it enhances our violation could have significant
top priority for us. We work to ensure our overall capabilities and promotes a culture reputational repercussions.
operations are fatality free and become a of innovative thinking. To attract and retain Therefore, we are actively engaged
benchmark in the steel industry. Currently, diverse talent is a challenge considering the in upholding human rights in areas
we are working on six safety and health nature and breadth of our operations. where we operate.
strategies, which drive our corporate
objective of ‘Committed to Zero’.
SE - Strategic Enabler 59
HUMAN CAPITAL (Continued)
~12%
business plan. Executives have safety targets that are embedded in
their annual performance metrics and are linked to remuneration.
An integrated health, safety & environment risk management system increase in ‘Near Miss’1
was rolled out across the organisation to identify hazards, and assess captured over the last
and mitigate risks. A new Health and Safety Reward and Recognition financial year
policy has been formulated to promote positive safety behaviour.
1
ccupational Safety and Health Act (OSHA) defines a near miss as an incident in which no property was damaged and no personal injury was
O
sustained, but where, given a slight shift in time or position, damage or injury easily could have occurred
61
HUMAN CAPITAL (Continued)
1.2%
implementation across the organisation. A procedure for process hazard analysis has been
developed and piloted on new projects. A structured asset management standard framework
has also been developed. improvement in Health Index
Establishing industrial hygiene and improving occupational health
Tata Steel’s integrated approach in industrial hygiene and occupational health is underpinned
56%
by the three pillars of prevention, promotion and reintegration. We follow the World Health high-risk cases related
Organisation’s model of ‘healthy workplace’ for creating a workplace that does not harm the to lifestyle diseases
mental and physical well-being of people. The ‘Wellness at Workplace’ programme was initiated transformed to moderate or
to create awareness among people to adopt a healthy lifestyle and control lifestyle-related low risk
diseases. The effectiveness of the initiative is monitored through the Health Index1. Tata Steel has
collaborated with external partners to understand and improve workplace ergonomics through 10
risk assessments and implementation of ergonomics control measures. hazard control projects
12
ergo control projects
implemented
97
80
68
67
64
3
2
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
Lost Time Injury Frequency Rate (LTIFR) (Index) Health Index (Score out of 16)
Good Good
0.37
12.62
12.59
12.47
12.37
12.21
0.31
0.29
0.29
0.23
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
1
ealth Index consists of four parameters – blood pressure, blood sugar, serum cholesterol and Body Mass Index. Employees’ health is evaluated on these four
H
parameters and a score is generated on a scale of 16. A score of 0 in any of the Health Index parameters is deemed as high risk.
63
HUMAN CAPITAL (Continued)
7.52
2,63,050
2,48,000
2,31,177
5.62
1,93,924
4.60
2.62
2.65
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
Human Rights
Tata Steel is committed to upholding human rights across its value chain. Our commitment is reflected in the following policy
documents (for more information, visit www.tatasteel.com).
The implementation of the Human Rights Policy at workplace is done through the adoption of the principles of SA8000 and the
United Nations Global Compact based on the Universal Declaration of Human Rights (UDHR) and ILO conventions.
Tata Code of Social Prevention of Safety Principles Affirmative Action Corporate Social
Conduct Accountability Sexual Harassment and Occupational Responsibility and
Policy (Human (POSH) and Anti Health Accountability
Rights at the Sexual Harassment
Workplace) Initiative (ASHI)
We actively seek to strengthen our mechanism to prevent and mitigate adverse human rights issues through SA8000 audits
of our workplace. Appropriate corrective and remedial measures (checks and balances) have been identified to address any
non‑compliances. Tata Steel underwent SA8000 surveillance audit in Financial Year 2017-18, and improved its Social Finger Print
Score from 3.9 to 4.3 on a scale from 1 to 5.
65
We
Contribute
Towards a
sustainable world
Acting responsibly towards the environment and the communities
we operate in is embedded in our core values. We also relentlessly
focus on ensuring the well-being and safety of people at our
workplaces, balancing economic prosperity, and generating social
benefits for the surrounding communities.
2018
Steel Sustainability
Champion
Recognised by World Steel Association
Natural
Capital Featured among top
7
Conserving natural integrated steel companies
globally in CDP 2018
SO4
<2 tCO2/tcs GHG emission intensity
To achieve industry leadership in Corporate Social Responsibility
and Safety Health & Environment.
by 2025
WAY FORWARD Zero effluent discharge by 2025
We are investing in technologies to achieve the highest Sustain LD slag utilisation at 100%
environmental performance standards. We plan to achieve
this by adopting breakthrough technologies for raw materials Ensure no net loss of biodiversity at
management, higher utilisation of LD slag, setting up the steel
recycling business, achieving zero water discharge, carrying
our mining locations
out lifecycle assessments of our products and embedding the
principles of circular economy in our operations.
IMPACT ON SDGs
Managing environmental
impact of operations
We have policies and processes in place for reducing energy usage
and minimising our environmental footprint across the value chain.
We have set stringent targets for energy intensity, greenhouse gas
emission, and water conservation. Our efforts also focus on reducing
waste, enabling a sustainable supply chain and understanding
the impact of our products on the environment through lifecycle
assessments.
The mining operations of Tata Steel are working towards Mined raw materials
enhancing progressive reclamation activities of the mine
dumps and ecosystems. In Financial Year 2018-19, the
following activities were undertaken in line with our policy
objectives of restoring the floral diversity and conservation
of keystone species:
28 MnT
• Optimised the plantation programme in terms of precise
type and number of native species to be used. The
diversity of the native species being used for plantation
activities increased by 22% and plantation of primary Imported raw materials
keystone species increased five times
• Completed the mapping distribution of invasive species
at the Joda East iron mine and a systematic eradication
and restoration plan is now being implemented ~12 MnT
• Planted over 2 lakh saplings of native species across raw
material locations
Bird activity was spotted in about 80% nest boxes that
were installed last year at Noamundi iron ore mines.
This niche nesting programme is being replicated at the
Company’s other mining locations.
ENVIRONMENTAL MANAGEMENT
We believe responsible environmental performance is an inherent element of our business strategy and these practices help us achieve a
leadership position in the industry. In Financial Year 2018-19, we spent ₹286 crore on environmental management efforts focussed on the four
pillars of emission, water management, circular economy and biodiversity.
Emissions performance
CO2 emission
The Paris agreement aims at arresting the global warming to <2
degrees celsius for which the key requirement is to make CO2
emission net zero by 2050. The steel industry contributes to about
6-8% of global emission and is considered to be a ‘hard to abate
sector’ since carbon is used as a reductant in the steelmaking
process and low carbon steelmaking technologies are yet to be
commercialised. Cognisant of India’s commitment and the sectoral
requirements, Tata Steel has set an aspirational goal of <2 tCO2/tcs
emission by 2025.
Over the years, the adoption of best available technologies for
waste heat recovery such as Top Recovery Turbine (TRT), Coke Dry
Quenching (CDQ), use of by-product gases in power generation
and other energy efficiency initiatives have resulted in improving
resource efficiency as well as reducing carbon footprint. We continue
Top Recovery Turbine, Jamshedpur Steel Plant
to implement Internal Carbon Pricing in our capital expenditure
appraisal process with the shadow price of carbon at US$ 15 /tCO2.
A Centre of Excellence with members from iron making, steelmaking,
R&D and technology groups was constituted in Financial Year 2018-19
to identify and implement projects for CO2 reduction. Some such
A benchmark for the industry projects are:
Tata Steel Jamshedpur is the Indian benchmark for CO2
• Carbon Capture and Use (CCU) at Tata Steel Jamshedpur and at
emission intensity at 2.29 tCO2/tcs and energy intensity at
the Ferro-Chrome plant at Bamnipal
5.67 GCal/tcs for steel production through Blast Furnace -
Basic Oxygen Furnace (BF-BOF) route. • Assessing renewable energy potential across our locations in India
• Maximising scrap utilisation in steelmaking
71
NATURAL CAPITAL (Continued)
TSJ & TSK - GHG emission intensity (tCO2e/tcs) In recognising the tangible business
Good benefits of disclosure through Carbon
Disclosure Project (CDP), Tata Steel is
3.08
2.65
2.3
2.3
9.1
11.1
7.82
7.3
7.20
7.5
6.1
7.2
6.58
5.03
0.66
0.60
5.1
4.94
0.57
0.5
0.44
0.41
0.37
0.83
1.63
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
Water management
Water is a critical resource used as a coolant in the steelmaking TSJ and TSK – Specific water consumption*
process. Currently over 3m3 of freshwater is required per tonne of (m3/tcs)
crude steel produced. Our operations in India are located near the
Good
Subarnarekha (TSJ) and Baitarani (TSK) rivers. We also have a water
7.66
reservoir, Dimna Lake, at Jamshedpur with a holding capacity of
6,292 million gallons of rain water, which can meet nearly 14% of
5.54
freshwater demand of the township. A river basin study has been
4.76
4.39
4.29
initiated for the Subarnarekha river to assess watershed level risks for
3.83
3.68
3.27
TSJ and implement better water management plans for improving
the water scenario in the district watershed and to ensure optimum
water flow in the river throughout the year.
Our water sustainability strategy for future-readiness is to continue FY15 FY16 FY17 FY18 FY19
investing in Sewage Treatment Plant (STP) and creating new Rain TSJ TSK
Water Harvesting (RWH) structures at various locations to improve
the ground water table. In Financial Year 2018-19, 29 million litres of TSJ and TSK – Effluent discharge
RWH structures were added at the Joda east iron ore mine. We have intensity (m3/tcs)
also created various rainwater harvesting structures beyond the Good
fence as part of our community initiatives (ponds and check dams)
2.31
and township infrastructure (rooftop) at Jamshedpur and our mining
locations. A 25 MLD tertiary treatment plant was commissioned at
Bara STP to convert sewage water of the Jamshedpur township into
1.2
process water for reuse in Jamshedpur steel works. This will help us
1.02
1.01
0.92
0.29
reduce our freshwater consumption by 18% in the future.
0.59
FY15 FY16 FY17 FY18 FY19
TSJ TSK
73
NATURAL CAPITAL (Continued)
100
99
steel value chain include coal rejects from the washeries, coal tar, slag,
87.22
84.4
and scrap from steelmaking shops and rolling mills. Our key initiatives
82.4
80.6
78.3
to maximise the utilisation of our by-products are described below:
66
• Recovery and reuse of metal from steelmaking slag:
Recovered metal from steel slag is used in the steelmaking
process. This scrap is used in steel melting shops along with clean
scrap and pooled iron.
• Blast furnace slag and steelmaking (LD) slag utilisation: FY15 FY16 FY17 FY18 FY19
Annually, Tata Steel handles ~17 MnTPA of by-products, which are TSJ TSK
converted and sold across 20+ product categories. The key solid
waste generated during an integrated steel plant operation are
the blast furnace and LD slag, which, if not utilised would require
to be stored in engineered landfills. Granulated blast furnace slag
is 100% utilised in Portland slag cement making. However, the
LD slag, because of its chemical composition and reactive nature,
has limited applications. Tata Steel has developed and launched
India’s first ever LD slag branded products – Tata Nirman (for
construction application) and Tata Aggreto (for building roads).
Road construction is a big market for Tata Aggreto made from
processed LD slag. Tata Steel is engaged with government
institutions such as Indian Road Congress (IRC) and National
Highways Authority of India (NHAI) to promote the use of LD slag
as a substitute of natural aggregates in road construction. Sales
of Tata Nirman and Tata Aggreto launched last year increased
significantly from 230 kt in the previous year to 370 kt this year.
Tata Nirman was adjudged as the winner under Green Building
Material for AAC Blocks/Bricks & Others at the 8th edition of the
National Fly Ash Utilisation Conference held in Goa.
We have achieved nearly 100% slag utilisation across our
operations by investing in the processing of by-products and
developing alternative use in the construction industry. Facilities for
de‑phosphorisation, slag granulation and briquetting are under
development, which would further ensure sustained utilisation with
higher value addition through usage in sinter making, construction,
road making, agriculture, etc.
100
96.9
94.6
93.9
for this industry in India. Most operations are manual and there is
92.4
92.9
91.3
91
little concern towards safety and environmental issues.
Tata Steel is taking the lead in setting up a steel recycling business
with the objective of collecting, aggregating and processing
scrap in a formalised way, which can subsequently be used for
steelmaking through the Electric Arc Furnace (EAF) route. Steel
production through the EAF route uses scrap as key input and is a
more sustainable way of producing steel. This could reduce carbon FY15 FY16 FY17 FY18 FY19
emission by 50-60% as compared to traditional steel production.
TSJ TSK
Through collaboration with the government, Tata Steel wants
to formalise this industry and enhance scrap utilisation through
partnerships across the supply chain, such as with aggregators,
processors, dismantlers, logistics partners and end consumers.
Steel Scrap
75
Social and relationship
capital
Strengthening >1.1million
lives touched through CSR
sustainable tomorrow
Customer satisfaction
index (steel) consistently above
Our long-term relationships
with customers, suppliers and
communities are key to our
80 (out of 100)
over the last 4 years
business sustainability. Nurturing
these relationships for the long
term is integral to our strategy.
~1,400
suppliers trained
through Vendor Capacity
Advancement Programme
(VCAP)
STRATEGIC REPORT | 1-88 STATUTORY REPORTS | 89-194 FINANCIAL STATEMENTS | 195-418
Customers
BUILDING RELATIONSHIPS WITH CUSTOMERS
In line with the motto of ‘Reshaping our business for tomorrow’,
Tata Steel is serving the growing needs of our B2B (Business
Accounts), B2C (Individual Consumers) and B2ECA (Emerging
Corporate Accounts) - customer segments by offering differentiated
products and services. Our end-to-end operation across the value
chain, from mining to finished steel goods, enables us to deliver
superior quality products. Over the years, we have built strong
relationships with the channel partners that has allowed us to serve
existing B2C and B2ECA customer segments through our nation-
wide professional distribution network. We are now leveraging this
extensive network established for steel products to extend our
customer-centric services and new solutions such as Tata Pravesh
Doors & Windows to markets in urban and rural India.
SO1 SO3
Increase revenue from our services
To meet our objective of becoming the industry leader in steel
and insulating revenue from steel cyclicality, we are is going
and solutions business
beyond the traditional products by offering a range of customised
services, solutions and value-added products across traditional Improve downstream products
and new customer segments business
WAY FORWARD
Enhance B2C business
• Expand Tata Pravesh into Tier 3 and Tier 4 towns
Increase revenue from new
• Increase share of high-strength steel in the Lifting & Excavation
segment
materials business
• Build customer base aligned to the health and sanitation
agenda through municipal corporations and corporates IMPACT ON SDGs
SO1 - Industry leadership in steel SO3 - Insulate revenues from steel cyclicality
77
SOCIAL AND RELATIONSHIP CAPITAL (Continued)
B2B (Business Accounts) B2C (Individual Consumers) B2ECA (Emerging Corporate Accounts)
• High product quality and performance • Offer design consultations for optimised • Branded products that offer quality and
product usage durability
• Cross-functional engagement through
customer service teams • Branded products that offer quality and • Customised grades and products through
trust micro-segmentation
• Extended long-term relationships with
customers • Network and channels that enable • Customer forums to share best practices,
products to reach customers just-in-time including safe working practices, and to
• Value-added engineering onsite support
build capability
to OEM customers • Digital platforms such as ‘Aashiyana’ for
early engagement and e-commerce • Digital platforms such as DigECA enable
• ‘COMPASS’: A digital platform for supply
our channel partners to serve the
chain visibility
customers better
Tata Steel domestic sales (MnT) BENEFITS CUSTOMERS DRAW FROM BHUSHAN STEEL ACQUISITION
Our customers also stand to gain from our acquisition of Bhushan Steel (now Tata Steel BSL),
42% 19%
B2B Industrial B2B Automotive through which we will be able to provide them an enhanced product portfolio. Our
product & customers will now have the advantage of choosing from our quality offerings in colour-
projects 16% coated products and precision tubes. This expanded capacity, leading to ramping up of
B2C volumes of Tata Shaktee, Tata Kosh, Tata Steelium and Tata Astrum, will empower our
customers by eliminating stock outs at their end and serve their demands better. In addition
22% to leveraging our customer outreach and sales, we can now provide a better range by
B2ECA manufacturing complementary products.
In Financial Year 2018-19, more than two-third of our output were served to our automotive
and construction customers who continue to be our valued partners. We also catered
to the engineering sector, in which our comprehensive portfolio of solutions range
from engineering services to custom-made plant and equipment. Our product range in
high‑quality agricultural implements is allowing our customers in Indian rural markets get
value for money. Beyond this, Tata Steel continues to expand into the oil & gas and lifting &
excavation segments by enhancing its expertise and preparing downstream facilities to serve
the segment. We are continuously striving to meet the evolving needs of our customers by
effectively engaging with our channel and ecosystem partners to enhance their capacity
and capability.
In India, Tata Steel continues to retain a Tata Steel is in the process of shaping the construction Tata Steel is working closely to develop
leadership position in the automotive industry by maintaining its leadership position in new grades of steel with its ECA brands.
segment. specific segments such as individual house builders,
• Over 157 customer engagement
medium and small housing and construction, and rural
• Providing focussed customer activities were organised for
roofing segment.
initiatives such as Customer 7,000+ Emerging Corporate Accounts
Service Teams, Value Analysis and • Tata Steel is investing in downstream products, which (ECAs), through the Ecafez Qualithon
Value Engineering and Advanced help reduce overall cycle time and project costs for platform
Technical Support our customers
• 5 ECA conclaves (an Engagement
• Provided high-end grades through • We are enhancing the quality of consumer experience forum for ECA customers with
the Kalinganagar plant through various initiatives. E-sales of Tata Tiscon and senior leadership of Tata Steel) was
Tata Shaktee have been scaled up through the early conducted for ECA customers across
• Attained 41% growth in high-end
engagement portal ‘Aashiyana’ India
cold rolled coils and sheets through
JCAPCPL (joint venture between • India’s first-ever Fibre Reinforced Plastic foot over • Leveraged initiatives through the
Nippon Steel & Sumitomo Metal bridge was set up by the New Materials Business in deployment of customer service
Corporation and Tata Steel) March 2019 teams, Value Analysis and Value
Engineering (VAVE) and Technology
• New materials business developed
Day
FRP products for the automotive
sector
Customer Satisfaction
Index (Steel) (Score out of 100) Customer complaints (PPM)
Good Good
Happy working with Tata Steel
773
81.3
81.4
81.6
652
611
CSR initiatives.
Sanjay Khajuria
Senior Vice President, Corporate Affairs,
FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19
Nestlé India Limited
79
SOCIAL AND RELATIONSHIP CAPITAL (Continued)
Suppliers
FOSTERING LONG-TERM RELATIONSHIPS WITH
SUPPLIERS
As an integrated steel manufacturer, we work very closely with our
network of supply chain partners in upstream as well as downstream.
Our supply chain process is focussed on using a multi-pronged
approach of vendor segmentation and developing long-term supplier
partnerships. We treat our 5,000+ vendors as business partners
through a fair and transparent governance process. All our supply
chain partners are required to comply with the Tata Code of Conduct
(TCoC) which enumerates the principles of fair business practice,
ensuring human rights, complying with environmental regulations
and standards, and adhering to health and safety requirements.
The supply chain partners are covered under the whistle blower policy
and a formal grievance redressal system. To ensure high standards
of occupational health and safety in the supply chain, suppliers are
rated on a 5-star scale. Contracts with high safety risks are awarded
only to partners who score 4 and above on this scale. We also conduct
periodic audits to ensure compliance to good human rights practices.
359 vendors have been trained on TCoC and SA8000, and eight have Supplier Sustainability Expo 2018
been blacklisted due to non-compliance with the TCoC.
Communities
SHARING VALUE WITH COMMUNITIES FOR
A SUSTAINABLE TOMORROW
For Tata Steel, the well-being of communities and employees is at the
core of its business. We operate in the remote regions of Jharkhand
and Odisha whose overall socio-economic development is not at par
with other parts of the country. The mining and metals industry has
an inherent, significant and lasting adverse social and environmental
impact on the surrounding population. We have mitigated these
impacts by delivering a number of path-breaking interventions since
inception. Townships with necessary facilities (utilities, healthcare,
education and opportunities for earning a livelihood) provide a
superior quality of life equally benefitting employees, their families
and the local population.
SO4
Touching > 2 million lives by 2025
Industry leadership in CSR and SHE
• Establish district models in improving access to and quality of education and healthcare for
infants, mothers and adolescents
• Continue to engage with tribal communities and nurture leadership potential among tribal
youth
• Adopt innovative ways of enhancing household income, community nutrition, completion of
basic education till matriculation by all, dealing with endemic water deficiency, supporting the
differently abled and enabling better self-governance among citizens at the panchayat level
• Explore partnerships with governments, social sector organisations, academia, experts and
other organisations in the national development space
81
SOCIAL AND RELATIONSHIP CAPITAL (Continued)
Tata Steel’s CSR strategy looks at establishing replicable change models which impact core development gaps
across India (Signature Programmes) and enhance thematic development focus on communities in operating areas
(Proximate Community Development). In addition, TSL continues to strengthen its CSR governance and consolidate
its leadership position by intensifying deployment of its key initiatives through the Tata Steel Foundation.
Maternal and New Born Survival Initiative Infant mortality reduced in 12 blocks of
(MANSI) Odisha and Jharkhand
MANSI focusses on working with pregnant women, A real-time digital tracking system was
mothers and children on the issue of infant mortality launched to provide vital support to
through partnerships with the government, and Sahiyas and ASHAs to respond to high-
national and international NGOs. risk cases
Almost 1,855 high risk child and mother
cases identified
~44% reduction in death rate achieved
990+
training.
The RISHTA Android application enables detailed profiling and tracking
of each adolescent over the project period, leading to focussed health Peer educators developed
inerventions and linkage to government programmes. from adolescent population
Drinking water
We install and repair drinking water facilities such as hand tube wells 1.2 lakh +
and deep bore wells, and piped drinking water, and are working on beneficiaries impacted
solar-powered drinking water projects. through installation of
these facilities
The Springs initiative was an experiment conducted to prevent
contamination of natural perennial springs. It enabled availability of
clean water to five villages throughout the year.
Our Saving Lost Childhood programme aims Almost 40 boys were mainstreamed to CBSE-
to reduce child labour in Jamshedpur. based formal schools in FY 2018-19 from the first
Masti Ki Pathshala
Pipla school in Jamshedpur now caters to around
100 girls from nearby areas who require bridging
and mainstreaming to formal schools
Scholarships
We offer Tata Steel Scholars Programme
90+
and Jyoti scholarships that provide financial students received scholarships under Tata Steel
assistance to meritorious SC/ST students for Scholars Programme for Jharkhand and Odisha
3,300+
post-graduate professional courses. Jyoti
fellowship is also offered to SC/ST students
from Class VII to post-graduation. students received scholarships under Jyoti
Fellowship in Jharkhand and Odisha
7
Tata Steel Scholars received pre-placement
offers from Tata Steel in FY 2018-19
83
SOCIAL AND RELATIONSHIP CAPITAL (Continued)
~2,500
Ek Pahal is a skilling initiative to constructively engage prison inmates
by imparting in-house training to enable them to secure gainful
employment, both within and outside the jail. youth trained
~2,000
Digital skills for rural children are imparted through a classroom-
on-wheels called ‘Kaushalyan’ using an air-conditioned bus with
workstations, an LED TV display as well as a trained computer faculty. youth placed/
The nursing programme aimed at addressing the issues of poverty, self-employed
unemployment and mass migration through nursing training.
~85
ponds constructed/repaired
in Jharkhand and Odisha for
agricultural and domestic
use
The Corridor is the route connecting Tata Steel’s Jamshedpur and Kalinganagar operations.
The project has extensive data on over 3.6 lakh population (>90,000 households) in
71 Gram Panchayats across 5 districts using the Data, Evaluation, Learning, Technology and
Analysis (DELTA) digital microplanning system of the Tata Trusts
85
SOCIAL AND RELATIONSHIP CAPITAL (Continued)
Zonal 69 42 22 16 80
National 182 14 16 18 48
International 6 3 1 3 7
87
Awards and recognitions
We are a leading corporate in the Indian and global steel industry. We
continue to be recognised for our operational excellence, as well as,
environmental and social stewardship.
PM’s Trophy for the Best Performing Steel Sustainability Champions 2018
Integrated Steel Plant for 2016-17 recognition by World Steel Association
‘Global Steel Industry Leader’ in the Tata Pravesh Doors, Tata Pipes & Awarded the Authorised Economic
Dow Jones Sustainability Index (DJSI) Tata Structura have been certified as Operator (AEO) Status (Tier 2) in
2018 green products through ‘GreenPro’ March 2019 by The Directorate of
certification by the Confederation of International Customs (Ministry of
Indian Industry (CII). Finance)
(First steel products in India to get this
eco-label)
419 NOTICE
BOARD’S REPORT
Board’s Report
To the Members,
Your Directors take pleasure in presenting the 4th Integrated Report (prepared as per the framework set forth by the International Integrated
Reporting Council) and the 112th Annual Accounts on the business and operations of your Company, along with the summary of standalone
and consolidated financial statements for the year ended March 31, 2019.
A. Financial Results
(` crore)
Standalone Consolidated
Particulars
2018-19 2017-18 2018-19 2017-18
Revenue from operations 70,610.92 60,519.37 1,57,668.99 1,24,109.69
Total expenditure before finance cost, depreciation (net of
50,047.98 44,740.41 1,28,285.65 1,02,676.50
expenditure transferred to capital)
Operating Profit 20,562.94 15,778.96 29,383.34 21,433.19
Add: Other income 2,405.08 763.66 1,420.58 881.10
Profit before finance cost, depreciation, exceptional
22,968.02 16,542.62 30,803.92 22,314.29
items and taxes
Less: Finance costs 2,823.58 2,810.62 7660.10 5,454.74
Profit before depreciation, exceptional items and taxes 20,144.44 13,732.00 23,143.82 16,859.55
Less: Depreciation and amortisation expenses 3,802.96 3,727.46 7,341.83 5,741.70
Profit/(Loss) before share of profit/(loss) of joint ventures &
16,341.48 10,004.54 15,801.99 11,117.85
associates, exceptional items & tax
Share of profit/(loss) of Joint Ventures & Associates - - 224.70 239.12
Profit/(Loss) before exceptional items & tax 16,341.48 10,004.54 16,026.69 11,356.97
Add/(Less): Exceptional Items (114.23) (3,366.29) (120.97) 9,599.12
Profit before taxes 16,227.25 6,638.25 15,905.72 20,956.09
Less: Tax Expense 5,694.06 2,468.70 6,718.43 3,392.33
(A) Profit/(Loss) after taxes - from Continuing operations 10,533.19 4,169.55 9,187.29 17,563.76
Profit/(loss) before tax from Discontinued operations - - (98.60) 206.96
Less: Tax expense of Discontinued Operations - - (9.64) 13.06
Profit/(Loss) after tax from Discontinued Operations - - (88.96) 193.90
Profit/(Loss) on Disposal of Discontinued Operations - - - 5.15
(B) Net Profit/(loss) after tax - from Discontinued operations - - (88.96) 199.05
(C) Net Profit/(Loss) for the Period [ A + B ] 10,533.19 4,169.55 9,098.33 17,762.81
Total Profit/(Loss) for the period attributable to:
Owners of the Company - - 10,218.33 13,434.33
Non-controlling interests - - (1,120.00) 4,328.48
(D) Total other comprehensive income (50.22) (61.12) 7.79 (3,078.01)
(E) Total comprehensive income for the period [ C + D ] 10,482.97 4,108.43 9,106.12 14,684.80
Retained Earnings: Balance brought forward from
18,700.25 12,280.91 7,801.99 (11,447.01)
the previous year
Add: Profit for the period 10,533.19 4,169.55 10,218.33 13,434.33
Less: Distribution on Hybrid perpetual securities 266.12 266.13 266.12 266.13
Add: Tax effect on distribution of Hybrid perpetual securities 92.99 92.70 92.99 92.70
Add: Other Comprehensive Income recognised in
3.88 155.39 (425.92) (2,780.05)
Retained Earnings
Add: Other movements within equity 1.49 3,427.46 (1,995.47) 9,926.37
Balance 29,065.68 19,859.88 15,425.80 8,960.21
Which the Directors have apportioned as under to:
(i) Dividend on Ordinary Shares 1,145.92 971.22 1,144.76 970.05
(ii) Tax on dividends 224.86 188.41 224.61 188.17
Total Appropriations 1,370.78 1,159.63 1,369.37 1,158.22
Retained Earnings: Balance to be carried forward 27,694.90 18,700.25 14,056.43 7,801.99
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BOARD’S REPORT
4. Capex and Liquidity Growth in India was 7.1%, primarily due to growth in construction
During the year under review, the Company, on a consolidated sector (8.9%) and manufacturing sector (8.1%). The Gross fixed
basis spent `9,091 crore on capital projects across India, Europe capital formation is estimated to have increased by 10%, thereby
and Canada largely towards essential sustenance, replacement and contributing to 32.3% of GDP.
on-growth projects in India (Kalinganagar plant and Tata Steel BSL Overall, increasing trade tensions took a toll on business confidence,
Limited), and in the Netherlands. Despite this significant spend, the worsening financial market sentiments. Also, tightening financial
Company was able to keep the gross debt level stable during the year. conditions for vulnerable emerging markets in early 2018 and for
The Company’s liquidity position remains strong at `15,284 crore advanced economies later in the year showed its impact on global
as on March 31, 2019, comprising `5,937 crore in cash and cash demand, leading to a slowdown in global economic growth.
equivalent and `9,347 crore in undrawn bank lines.
2. Economic Outlook
5. Management Discussion and Analysis According to the International Monetary Fund (‘IMF’), global
The Management Discussion and Analysis as required in terms economic growth is expected to further decline to 3.3% in 2019 but
of the Listing Regulations is annexed to the report (Annexure 2) return to 3.6% in 2020. While the slow paced growth in the second
and is incorporated herein by reference and forms an integral part half of 2018 is likely to continue in the first half of 2019, growth in
of this report. the second half of 2019 is expected to gain momentum, owing to
an ongoing build-up of policy stimulus in China, improvements in
B. Integrated Report global financial market sentiment, waning of some temporary drags
on growth in the euro area, and a gradual stabilisation of conditions
In keeping with the Company’s commitment to society, in 2016,
in stressed emerging market economies. Improved momentum
we transitioned from compliance based reporting to governance
for emerging market and developing economies is projected to
based reporting by adopting the <IR> framework developed by the
continue into 2020, primarily reflecting developments in economies
International Integrated Reporting Council.
currently experiencing macroeconomic distress.
We present to you our 4th Integrated Report which highlights the
Growth in advanced economies is expected to slow down from
Company’s efforts during the year that contribute to long-term
2.2% in 2018 to 1.8% in 2019 to 1.7% in 2020. The United States is
sustainability and value creation, paving way for a better tomorrow.
expected to grow at a slower pace of 2.3% in 2019, down to a further
1.9% in 2020 as the impact of the fiscal stimulus fades. Growth in the
C. External Environment
Euro area is expected to decline to 1.3% in 2019 as the effect of the
1. Macroeconomic Conditions weakness in 2018 is likely to carry forward to the first half of 2019.
Following an upswing in the last two years, global growth declined China’s economic growth is expected to be at 6.3% in 2019 due to
to 3.6% in 2018, owing to various factors such as increase in trade lingering impact of trade tensions with the US.
tensions and tariff hikes between the United States and China, The Indian economy is expected to grow at about 7.3% in 2019
decline in business confidence, tightening of financial conditions, and further by 7.5% in 2020, supported by the continued recovery
and higher policy uncertainty across many economies. While the of investment and robust consumption amid a more expansionary
first half of 2018 witnessed strong growth at 3.8%, the second half stance of monetary policy and some expected impetus from fiscal
saw a deceleration in global economic activity, in light of the various policy. Resolution of Non-Performing Assets (‘NPA’) and other
factors affecting major economies. recoveries over the past year have been efficacious. Large NPA
Growth in China was at 6.6%, its slowest pace since 1990, due accounts should continue to see resolution in 2019. The projected
to necessary domestic regulatory tightening, slower domestic increase in growth rate can also be attributed to sustained rise in
investment, and tariff hikes and trade tensions with the United consumption, gradual revival in investments, and greater focus on
States. The United States witnessed a growth of 2.9%, the highest infrastructure development.
since 2015, with major contribution coming from personal spending,
fixed investment, public expenditure and inventories. Growth in the D. Steel Industry
Euro area economy slowed to 1.8% in 2018, owing to weakening 1. Global Steel Industry
consumer and business sentiments, disruptions in car production
According to the World Steel Association (‘WSA’), global crude steel
in Germany due to delay in introduction of new fuel emission
production reached 1,808.6 MnT in 2018, an increase of 4.6% over
standards, fiscal policy uncertainty, elevated sovereign spreads, and
2017. This increase is primarily due to growth in steel consumption
declining investment in Italy, and drop in external demand, especially
in infrastructure, automotive, manufacturing and equipment
from emerging Asia. Growing concerns about a no-deal Brexit also
sectors. China continued to be the world’s largest crude steel
probably weighed on investment spending within the euro area.
producer, contributing to 51.3% of the global crude steel production.
Activity in Japan weakened mainly due to natural disasters.
Crude steel production in India, increased to 106.5 MnT. India’s crude
steel production increased by 4.9% over the previous year, making E. Operations and Performance
India the second largest crude steel producing country.
1. Tata Steel Group
Despite slowdown in the economy, global steel demand increased by
During the year under review, Tata Steel Group (‘the Group’)
2.1% in 2018. The marginal increase over 2017 was mainly supported
recorded total deliveries of 26.80 MnT (previous year: 22.89 MnT).
by government stimulus in China and better than expected economic
Increase in deliveries was due to acquisition of Bhushan Steel Limited
activity. However, steel demand in developed economies slowed to
[renamed Tata Steel BSL Limited (‘TSBSL’)] along with higher volumes
1.8% in 2018 as compared to 3.1% in 2017.
from Tata Steel Kalinganagar. The turnover for the Group was at
Steel demand in the European Union (‘EU’) grew by 2.2% in 2018 as `1,57,669 crore (previous year: `1,24,110 crore), an increase of 27%
against 3.4% in 2017. Output growth in the steel consuming sectors in over the previous year. This increase is primarily attributable to
the EU eased in the second half of 2018, especially in the automotive increase in deliveries and realisations from domestic operations and
sector. Output of passenger cars was negatively impacted by the increase in realisations at Tata Steel Europe.
introduction of new emission testing procedures and a slowdown in
The Group EBITDA was `29,770 crore (previous year: `21,369 crore),
demand both inside and outside the EU. In 2018 the EU was a net
an increase of 39% over the previous year. EBITDA increased mainly at
importer of steel at 16.9 MnT. Exports from China to the rest of the
Tata Steel Limited (Standalone) on account of improved steel margins
world decreased again in 2018 to 68.8 MnT. Changing trade flows
attributable to higher volumes, higher realisations and acquisition
in the global steel market have caused an increase in the amount of
of TSBSL. Increase in EBITDA at Tata Steel Europe is attributable to
anti-dumping measures.
better than expected market conditions with higher selling prices in
2. Outlook for Steel Industry the European market.
As per WSA, global steel demand is forecasted to reach During the year under review, the Group reported a consolidated
1,735 MnT in 2019, an increase of 1.3% over 2018. In 2020, global profit after tax (including discontinued operations) of
steel demand is expected to reach 1,752 MnT, reflecting an increase `9,098 crore (previous year: `17,763 crore) which translated into a
of 1%. Although steel demand is expected to grow, the rate of growth basic Earning per share of `87.75. Profits were lower than previous
will be lower owing to slowdown in global economy. Further, China’s year as previous year’s profit included an exceptional gain of
deceleration, uncertainty surrounding trade policies and the political `9,599 crore primarily due to non-cash accounting surplus arising
situation in many regions suggest a possible moderation in business from the formation of new British Steel Pension Scheme, as against a
confidence and investment. charge of `121 crore during the current year.
China plans for a major structural overhaul of the steel sector by 2. India
2020. Further, it plans to reduce the steel output which would ease
During the year under review, total deliveries at Tata Steel Limited
the uneven supply-demand situation in the sector, modernise the
(Standalone) were at 12.69 MnT (previous year: 12.15 MnT), recording
steel mills to achieve energy consumption and pollutant emissions
an increase of 4.5% over the previous year. Turnover was `70,611
within the nation standard by 2020. Steel demand in developing Asia
crore (previous year: `60,519 crore), 16.7% higher than that of the
excluding China is expected to grow by 6.5% and 6.4% in 2019 and
previous year. EBITDA from Tata Steel Limited (Standalone) was
2020 respectively, making it the fastest growing region in the global
`20,744 crore (previous year: `15,800 crore), 31% higher than that of
steel industry. In the ASEAN region, infrastructure development is
the previous year.
expected to support demand for steel. Steel demand in advanced
economies is expected to grow at a slower pace owing to trade During the year under review, crude steel production in India
tensions and lower spend on construction activities. (including TSBSL) increased by 35% to 16.81 MnT. Total deliveries
at Tata Steel India were at 16.26 MnT, recording an increase of 34%
Steel demand in India is expected to grow at 7% in 2019 as well
over the previous year due to the acquisition of TSBSL and a ramp
as in 2020. Steel demand in India will be driven by broad based
up at both Kalinganagar and TSBSL. Volumes from Indian operations
growth across sectors. Construction is expected to grow boosted
account for more than 61% of the consolidated volumes.
by government spending on infrastructure. The automotive sector
is expected to grow at about 7.5% in 2019 which is lower than The turnover (excluding inter-company eliminations and
that of 2018 as sales slowed towards the end of 2018 and early adjustments) from Indian operations (including TSBSL) was
2019. Policy to support real estate sector will lead to stronger `88,987 crore, 47% higher than that of previous year. This was mainly
growth in 2019. Recovery in the capital goods sector witnessed due to higher steel realisation and volumes.
in 2018 is expected to sustain in 2019. The sector is expected to
Indian operations including TSBSL reported EBITDA (excluding
grow above 7% aided by increasing demand for construction and
inter-company eliminations and adjustments) for the year was
earthmoving equipment.
`23,777 crore, which has been highest ever in history. This has been
Industry consolidation through the Insolvency and Bankruptcy Code, achieved by strong operating and commercial performance.
2016, is expected to lead to improved discipline in the marketplace
Company’s leadership position in chosen segments has been
and stable pricing. Change of ownership will also lead to improved
growing continuously and industrial products and project segments
capacity utilisation levels over the next 1-2 years.
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BOARD’S REPORT
sales grew by 42% year-on-year. The branded products retails and The Graphene and Fibre Reinforced Polymer businesses have
solutions business grew by 30% year-on-year, the automotive also established required enablers to scale up. The Steel Recycling
segment sales increased by 21% year-on-year, and the automotive Business is setting up the required business model and capabilities.
steel sales volume crossed 2.25 million mark in Financial Year 2018-19.
Going forward, the Company aspires to further strengthen its
The Company is striving for a sustainable business model and has leadership position in the industry and is pursuing the following
undertaken a number of initiatives that will reduce its carbon priorities in the medium term:
footprint across the value chain. The CO2 emission intensity at
Industry leadership in Steel: In the near future, India, given its
Jamshedpur plant improved to 2.28 tonnes of carbon per ton of steel
proposed infrastructure projects, is expected to be one of the
in Financial Year 2018-19. The solid waste utilisation was in excess of
largest consumers of steel and stimulators of steel demand. In order
99%. Tata Steel Kalinganagar Phase - II expansion is progressing as
to meet this increasing demand, the Company has in place, plans
per plan and is scheduled for completion in Financial Year 2021-22.
to consistently grow through brownfield expansions as well as
3. Europe value creating acquisitions. In order to attain leadership position
in the steel industry, key priority for the Company is to progress
During the year under review, production at European operations
on implementation of TSK Phase - II. The Company is also working
was lower by 381k tonnes (4%) on account of operational issues at
towards creating a larger long products portfolio to participate
both the sites, mainly due to overrun of BF5 life extension works in
in the growing market for long products, driven by increase in
the UK Pellet plant overhaul issues and fire at caster 22 in IJmuiden.
urbanisation and infrastructure development. To achieve this
Deliveries declined by 350k tonnes (4%) in line with lower production.
objective, integration of the steel business of Usha Martin Limited
The turnover increased from `59,985 crore in previous year to and a roadmap for growth in Long Products will be the areas of
`64,777 crore during the year owing to increase in average revenue focus for the future. The Company also aspires to attain leadership
per tonne due to improved market conditions. EBITDA increased position in new segments viz. Lifting and Excavation, Oil and Gas,
by `1,701 crore (46%) attributable to better than expected market Pre-Engineered Buildings, etc. and to maintain leadership position in
conditions with higher selling prices in the European market. segments such as Automotive, Emerging Corporate Accounts (Small
and Medium Enterprises), Individual House Builders, etc.
The European Operations reported loss before tax as compared
to profit reported in the previous year which included gain of Consolidate position as global cost leader: The Company has
`13,851crore relating to non-cash accounting surplus arising from consistently been one of the most profitable and lowest cost
the formation of new British Steel Pension Scheme. producers of steel in the world. Cost of captive iron ore and coal
represents almost 50% of the operational cost base of the Company.
F. Strategy Structural cost reduction projects in areas of operational efficiency,
The year under review has been quite rewarding for the Company in employee productivity, logistics, digital-enabled efficiency
terms of meeting profitability targets, preparing for the future and enhancement, etc. are being undertaken to consolidate and to
witnessing progress on initiatives commenced in the previous years. maintain the Company’s position as a cost leader. Realisation of the
planned synergy benefits with Tata Steel BSL Limited is also a top
The acquisition of Bhushan Steel Limited (renamed Tata Steel BSL priority in this area.
Limited) has enhanced the overall capacity of the Company by 5 MnT,
thereby providing the structurally strong Indian business operations the Insulate revenues from steel cyclicality: The steel industry is
required scale. The Company has further growth plans including growth cyclical in nature. In order to insulate itself from this cyclicality, the
of its long products business. During the year, the Company also entered Company is focusing on strengthening the branded consumer
into definitive agreements to divest majority stake in its South-East Asian business and downstream product portfolio. Tata Steel has embarked
operations in order to focus resources on growth in India. on Services & Solutions (‘S&S’) business to reduce the impact of steel
cyclicality. Pravesh and Nest In are examples of our offering in S&S.
The Company has also taken steps to establish a sustainable These businesses are seeing significant growth. Leveraging our deep
leadership position through simplification of the organisation and knowledge of customer needs and ability to execute insight-driven
building scale in capabilities and new businesses. As part of its innovation, we believe that this portfolio will provide us with
strategy, various teams have been set up to achieve certain goals for significant competitive advantage in future. We are planning for
the organisation. These teams include: (i) an integrated technology strong growth in S&S and these businesses can contribute 20% of
team, to achieve the goal of being amongst the top 5 in steel our revenue going forward.
technology globally; (ii) a One IT team to achieve the goal of value
creation through digital transformation by investing in the required Tata Steel is also scaling up a portfolio of new materials, currently
infrastructure and partnerships; and (iii) an integrated supply chain comprising of Graphene and Fibre Reinforced Polymer. These new
team to enable multi-locational growth and greater efficiency. In the businesses have exciting possibilities and we will use technology
Services & Solutions portfolio, ‘Pravesh’ (steel doors and windows) is to create differentiating value propositions and new applications.
making progress towards achieving the required scale. S&S and new materials businesses will provide added impetus to our
differentiated play and provide a unique growth opportunity.
Industry leader in Corporate Social Responsibility and Safety, Company by way of a composite scheme of amalgamation and have
Health and Environment: As one of the leading steel producers in recommended a merger ratio of 1 equity share of `10 each fully paid
the world, the Company aspires to be a leader in sustainable business up of the Company for every 15 equity shares of `2 each fully paid up
practices in the industry. Towards this objective, the Company is held by the public shareholders of TSBSL.
taking steps to reduce its environment footprint. Focusing on steel
As part of the scheme, the equity shares held by BNPL and the
scrap recycling business to promote sustainable steel making and
preference shares held by the Company in TSBSL shall stand
to create a circular economy for steel is one of the key elements
cancelled. The equity shares held by the Company in BNPL shall also
of our business model for growth in Long Products. The Company
stand cancelled. The amalgamation is subject to shareholders and
also recognises the need to create a safe and healthy environment
other regulatory approvals.
for all employees and stakeholders and desires to be an industry
leader in Corporate Social Responsibility (‘CSR’) and Safety, Health & Acquisition of Creative Port Development Private Limited
Environment (‘SHE’). This will be achieved through enhanced focus
In January 2017, the Company entered into definitive agreement
on reducing unsafe incidents at the workplace, carbon emissions and
to acquire 51% equity stake in Creative Port Development Private
consumption of natural resources such as water. The Company will
Limited (‘CPDPL’) for the development of Subarnarekha Port at
continue to deepen the engagement with communities, aiming to
Odisha through a wholly-owned subsidiary Subarnarekha Port
touch many more lives through its CSR initiatives.
Private Limited. On September 18, 2018, the Company completed
Strategic enablers: Creation of a set of core capabilities in the the acquisition of 51% equity stake in CPDPL, a proposed
organisation is essential for the Company to achieve its Strategic greenfield port project.
Objectives. People are the key to success for any organisation and
hence, the Company continues to direct its efforts towards building Acquisition of Steel Business of Usha Martin Limited
a skilled, engaged and diverse workforce. Along with this, the On September 22, 2018, the Company, as a part of its strategy to grow
Company is also focussed on creating the right organisation culture in long products, executed definitive agreements for acquisition of
that encourages agility and innovation. The Company is also focussed steel business of Usha Martin Limited (‘UML’), a special steel and wire
on investing in various digital initiatives, enabling new business rope manufacturer, through a slump sale on a going concern basis.
models and enhancing the digital maturity of the organisation.
Tata Sponge Iron Limited (‘TSIL’), a 54.5% subsidiary company
During the year under review, initiatives were taken to put in place
engaged in the sponge iron business, had been evaluating various
an innovation framework. In the coming year, the focus will be to
strategic options to enhance its product portfolio and had identified
put in place a structure and engagement mechanism for partnering
an entry into steel manufacturing in long products as a route to
with startups. The Integrated Technology Organisation will focus on
ensure sustainable value creation for its shareholders.
creating outcome-based external collaborations and developing
deep expertise in identified strategic thrust areas. On October 24, 2018, the Company extended support for TSIL’s
entry into steel business and identified it as the strategic vehicle for
G. Key Developments acquisition of steel business of UML.
Acquisitions and Investments On April 9, 2019, TSIL completed the acquisition of steel business
undertaking including captive power plants, for a cash consideration
Acquisition of Bhushan Steel Limited (renamed Tata Steel BSL
of `4,094 crore, which is subject to further hold backs of `640 crore,
Limited)
pending transfer of some of the assets including mines and certain
During the year under review, the Company through its wholly-owned land parcels.
subsidiary, Bamnipal Steel Limited (‘BNPL’) completed the acquisition
of controlling stake of 72.65% in Bhushan Steel Limited (renamed Tata Investment in TRF Limited
Steel BSL Limited) (‘TSBSL’), pursuant to the Resolution Plan (‘RP’) as In March 2019, the Company acquired 25,00,00,000, 12.5%
approved by the National Company Law Tribunal vide its Order dated Non-Convertible Redeemable Preference Shares of face
May 15, 2018, under Corporate Insolvency and Resolution Process value `10 each of TRF Limited on private placement basis,
(‘CIRP’) of the Insolvency and Bankruptcy Code, 2016 (‘IBC’). aggregating to `250 crore.
In March 2019, the Company acquired 1070,00,00,000 – 11.09%
Investment in Tata Metaliks Limited
Non-Convertible Redeemable Preference Shares of face value
`10 each, aggregating to `10,700 crore, in two tranches and In March 2019, the Company acquired 27,97,000 equity shares of
900,00,00,000 – 8.89% Optionally Convertible Redeemable face value `10 each of Tata Metaliks Limited at a price of `642 per
Preference Shares of face value `10 each, aggregating to `9,000 equity share aggregating to `179.57 crore and 34,92,500 Warrants
crore, in two tranches, of TSBSL. of face value `10 each at a price of `642 per Warrant, with a right
exercisable by the Company to subscribe for one equity share per
Further, on April 25, 2019, the Board of Directors of the Company Warrant of face value of `10 each, aggregating to `224.22 crore (25%
approved the amalgamation of BNPL and TSBSL into and with the paid on application).
95
BOARD’S REPORT
Sale of shares in NatSteel Holdings Pte. Ltd. (‘NSH’) and Tata First and final call on Partly Paid Shares
Steel (Thailand) Public Company Ltd. (‘TSTH’) In Financial Year 2017-18, the Board approved the simultaneous
T S Global Holdings Pte. Ltd. (‘TSGH’), an indirect wholly-owned but unlinked issue of 4:25 fully paid shares for an amount up to
subsidiary of the Company, executed definitive agreements to `8,000 crore at a price of `510 per share and 2:25 partly paid shares
divest its entire equity stake held in NSH (100%) and TSTH (67.9%) for an amount upto `4,800 crore at price of `615 per share (`154
to a company in which 70% equity shares will be held by an entity paid-up) on rights basis. The shares were allotted to the shareholders
controlled by HBIS Group Co. Ltd (‘HBIS’) and the balance 30% will on March 14, 2018.
be held by TSGH.
The first and final call on partly paid shares was to be made within
The definitive agreements signed between the two companies 12 months from the date of allotment. In terms of regulatory
is a significant milestone in strategic relationship, offering the clarification(s) received, the Company is permitted to make the call
South-East Asian business robust growth opportunities, given the on partly-paid shares beyond 12 months if (i) the issue size exceeds
access to resources, technical expertise and regional understanding `500 crore and (ii) the Company complies with the requirement under
of HBIS. The Company remains committed through its shareholding the applicable SEBI (Issue of Capital and Disclosure Requirements)
to help create a sustainable future for all stakeholders. Regulations regarding monitoring agency. The Company is in
compliance with both these conditions. Accordingly, the Board will
Joint Venture between Tata Steel and thyssenkrupp AG make the first and final call on the partly paid shares of the Company
Following the signing of a Memorandum of Understanding in at an appropriate time.
September 2017, the Company, on June 30, 2018, signed definitive
agreements with thyssenkrupp AG to combine the European Steel Credit Rating
Business into a 50:50 joint venture, named thyssenkrupp Tata Steel During the year under review, Moody’s Investors Services upgraded
BV, which will be positioned as a leading pan European high quality long-term Corporate Family Rating of the Company by one notch
flat steel producer with a strong focus on performance, quality from Ba3 to Ba2 while S&P has revised its ratings outlook on the
and technology leadership. The joint venture is built on the strong Company from ‘Stable’ to ‘Positive’ and affirmed the long-term credit
foundations of common value systems and a long heritage in the rating of ‘BB-’.
industry. The transaction is subject to merger control clearance in
several jurisdictions, including the European Union. H. Sustainability
Tata Steel and thyssenkrupp have been engaging parallelly with the Stemming from our founder’s belief that, what comes from society
European Commission (‘EC’) to provide information in relation to should go back to society, sustainability is deep rooted in the culture
the businesses which would be part of the proposed joint venture. of the organisation. The belief is embedded in Company’s Vision
Following pre-notification engagement with the EC, both parties which balances the aspiration of value creation and commitment to
notified the proposed joint venture to the EC on September 25, 2018. being a Corporate Citizen.
On October 30, 2018, in line with the expected timelines of the The sustainability approach of the Company is articulated in
merger review process, the EC announced that it will undertake an Sustainability Policy of the Company as well as in the Corporate Social
indepth review of the merger proposal and investigate certain areas Responsibility Policy, Environment Policy, Energy Policy, Climate
of preliminary competition concern. The Company has noted the Change Policy, Biodiversity Management Policy, Affirmative Action
EC’s concerns and will continue its discussions with the EC including Policy, and Human Resource policy, etc which reinforces the triple
providing further information and analysis, especially in relation to bottom-line approach in its systems and processes. The Company
sectors they have identified, to secure approval for the proposed also has systems in place to capture the voice of stakeholders
joint venture. Until completion of the JV process, thyssenkrupp periodically and review its long-term strategy in line with the
Steel Europe and Tata Steel Europe will continue to operate as stakeholder expectations.
separate companies.
Bracing itself for the future, the Company is working towards the Indian Steel Association, Confederation of Indian Industries and
integrating the key issues on planet and people into its strategy various other organisations. The Company has in place a board level
and business practices across the value chain. During the year, Safety, Health & Environment Committee that provides necessary
Environment, Social and Governance aspects of material issues direction and guidance on matters relating to environment and
were revisited through a third party Materiality Study covering monitors the performance of the Company and its impact on
stakeholders across all locations. This will further reinforce the the environment.
Company’s strategy for value creation across all stakeholders and
During the year, Tata Steel continued its efforts to reduce its
capitals. Aspirations of taking our carbon emissions to less than
carbon footprint by adopting best available technologies for
2 tCO2/tcs, zero waste and zero effluent discharge and doubling our
energy efficiency and heat recovery. The Plant at Jamshedpur is
CSR reach by 2025 are significant facets of this strategy.
the benchmark in India for CO2 emissions intensity at 2.29 tonnes
In order to mainstream sustainability in the decision making, the of CO2/tcs through BF-BOF route. The Company continues to use
Company organised a Sustainability Immersion Programme designed the internal Carbon Pricing mechanism for evaluation of capital
and facilitated by Cambridge Institute of Sustainability Leadership expenditure projects with shadow price of carbon @US$15/tCO2.
for Board Members, Senior Management, Senior Executives, and Contributing to national commitment towards the Paris agreement,
Union Leadership Team. During the year, the Company organised the Company has taken up aspirational goals to achieve global
four batches of the programme covering majority of the Board benchmark levels of less than 2 t/tcs CO2 emissions. Various cross
Members, entire senior Management team and more than 100 senior functional projects have been undertaken to identify and reduce
executives and Union Leadership Team across locations. CO2 emissions. Recycling steel scrap is an important lever to reduce
carbon footprint and the Company has set up a Steel Recycling
The Company is committed to serving its customers through a portfolio
business unit which will facilitate formalisation of the scrap market in
of eco-friendly products. During the year, the Company obtained CII’s
India and make more scrap available for conversion to steel.
GreenPro eco-label for Tata Pravesh Steel Doors and Windows and Tata
Structura and Tata Pipes. The third party eco-label certification ensures In Europe, the Company continues to invest in short to medium
customers of minimal environmental impacts of the certified products term CO2 emission reduction and energy efficiency improvements.
in a transparent way. For the first time in India, Steel Products have In addition to these improvements, as a follow up to the ULCOS
received the eco-label. Going forward, the Company will adopt the (Ultra-Low CO2 Steelmaking, co-operative research initiative to
global best practice of having Environmental Product Declaration of achieve a step change in CO2 emissions from steelmaking), the
key products to enable a transparent declaration of the environmental Company is also working on a major long-term project to develop
impacts of its products and processes in order to enable informed a new smelting reduction technology (‘HIsarna’) to produce steel
purchasing by the end consumer. without the need for coke making or agglomeration processes,
thereby improving efficiency, reducing energy consumption and
The continued focus on ‘Sustainability’ across the value chain has helped
reducing CO2 emissions. The pilot plant is located at the Company’s
the Company in being adjudged as the Steel Industry Leader globally on
IJmuiden site in the Netherlands.
Sustainability in Dow Jones Sustainability Index in 2018 with a top score
of 100 percentile in Environmental Dimension. The Company has also Climate Change
received the distinction of being recognized as Sustainability Champion
Climate change is one of the most pressing issues the world faces
by World Steel Association for the second year in a row.
today and the Company recognises its obligation to minimise
Environment its contribution to climate change. The Company aims to play a
leadership role in addressing the challenge of climate change.
The Company aims to be the benchmark for environmental
The Company recognises that, though steel is considered a ‘hard
stewardship in the steel industry by focusing on operational
to abate’ sector globally, it will be an integral part of the solution to
excellence aimed at resource efficiency through a ‘Prevent, Minimise,
climate change because of its infinite recycling properties.
Recover, Reuse and Recycle’ hierarchical approach to reduce its
ecological footprint. The Company is committed to responsible use Considering all these factors, the Company has formulated a climate
and protection of the natural environment through conservation and change strategy based on 5 key themes as outlined below:
sustainable practices. The Company has implemented environmental
management systems that meet the requirements of international Emissions Reduction: The Company will continue to improve its
standard ISO 14001:2015 at Jamshedpur Works and has initiated current processes to increase its energy efficiency and to reduce its
proceedings at Kalinganagar Works. These systems provide the carbon footprint.
Company with a framework for managing compliance and improving Investing in Technology: The Company will continue to invest in
environmental performance, making it future ready to address long-term breakthrough technologies.
stakeholder requirements.
The Company pursues responsible advocacy on policy and regulatory
issues by being member of the World Steel Association Environment
Committee, the Central Pollution Control Board’s National Taskforce,
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BOARD’S REPORT
Market Opportunities: The Company endeavours to develop such initiatives to improve their safety performance, the Company has
new products and services that reduce the environmental impact also taken upon itself to ensure that contractor employees in India
over its products’ life-cycles and help its customers to reduce their have the desired skills and competencies to perform their job safely.
carbon footprints. They are being tested and certified by Shavak Nanavati Technical
Institute (‘SNTI’) to ensure competence. In many cases they are also
Employee Engagement: The Company will actively engage its
being trained to achieve desired skills and competence. During the
workforce and encourage everyone to contribute to its strategy.
year under review, the Company covered a large part of the contractor
Lead by Example: The Company will further develop its pro-active role employee workforce in India. It’s an ongoing process and we expect
in global steel sector initiatives through the World Steel Association. to achieve 100% coverage within a year.
Health and Safety The Company is leveraging state of the art digital technology
Health and Safety Management remains Tata Steel’s foremost priority at various places to improve surveillance and analytics, reduce
and we are committed to being a benchmark in the industry. To us, hazardous man-machine interface and for various other corrective
Health and Safety is not just a metric but a part of our value system. and preventive actions.
The desire to being a benchmark is demonstrated through leadership On the health front, during the year under review, three distinct
commitment and is cascaded across the organisation in the form of campaigns were launched for the Indian operations. A detailed
long, medium and short-term action plans. ergonomic study has been undertaken in labour intensive
The Company has been working on six corporate level long-term departments, industrial hygiene projects have been undertaken
strategies viz. Build (Safety) leadership capability at all levels in departments where it has been assessed as a health risk and
to achieve zero harm, improve competency and capability for physical exercise has been introduced off duty hours, facilitated
hazard identification & risk management, contractor safety risk by a professional agency at various locations of the Company at
management, elimination of safety incidents on road & rail, Kalinganagar, Bhubaneswar, Joda, Jamshedpur, etc. to improve
excellence in process safety management, and establishing industrial employee health and wellness. This has helped to improve health
hygiene and improving occupational health. These strategies are index of the Company vis-à-vis previous year. These initiatives will
enablers through which several initiatives are undertaken that aid continue with increased intensity in times to come.
the Company in achieving its objective of ‘Committed to Zero’. At Tata Steel Europe, the long-term strategies to focus on occupational
For the Indian operations, one of the key initiatives undertaken health and process safety has facilitated in achieving zero fatality.
during the year under review was to strengthen Company’s quality Training for senior managers focusing on their leadership role related
management system, which is the foundation on which all other to health & safety continued during the year. The combined LTIFR in
systems are based. The company-wide IT based, Generic Document Financial Year 2018-19 for employees and contractors deteriorated
Control System (GDCS) was re-designed and re-launched to ensure to 1.45 as compared to 1.36 in the previous year. The recordable
availability of latest and controlled Standard Operating Procedures rate, which includes lost time injuries as well as minor injuries, also
(‘SOPs’) to employees for performing their tasks safely. The plant at deteriorated from 4.13 in Financial Year 2017-18 to 4.92 in Financial
Jamshedpur was re-certified for OHSAS 18001:2007 and a similar Year 2018-19. A campaign focusing on hazard identification and risk
process has begun for the plant at Kalinganagar. minimisation continued during the year under review and there were
various initiatives undertaken to accelerate deployment of standards,
During the year under review, a concerted effort has been made understand the mindset and behaviour and improve maturity of the
to increase risk sensitivity of the Company. A well articulated Group’s health & safety management system
methodology to evaluate and assess safety related risks has been
developed with its associated mitigation techniques. This is currently Research and Development
being rolled out in phases and it has already helped in achieving 26% In line with the aspiration to be amongst the top five innovation
reduction of high potential incidences in comparison to last year. driven companies in the world, the Company has put in place a
The initiative to roll out Process Safety through a ‘Center of Excellence’ new technology organisational structure. The technology road map
methodology at Jamshedpur has been appreciated by World Steel as exercise has materialised and teams are formed to work on selected
the ‘best practice’ of 2018, across the industry. Currently, the process projects. The year has been rewarding on many fronts for Research &
safety has been rolled out to 30 of 41 operating departments at Development. During the year under review, the Company became a
Jamshedpur and Kalinganagar. The balance departments will be leading player in the Indian Steel industry in terms of patent filing by
covered by Fiscal 2020. crossing the 1,000 mark. There is a progress in Graphene work from
Contractor employees’ fatality remains the topmost safety concern commercialisation perspective. Industrial solutions developed with
for the Company. It is with deep regret that we report two fatalities in graphene doped composites have offered significant improvement
India and one fatality in Singapore involving our contractor partners. in the operational costs of the process plants. Also, Graphene anti
The Company is continuously channelising its efforts to eliminate corrosion coatings have been established towards a green alternative
such incidents and achieve zero fatality. Apart from taking various to the current coating technologies. A number of breakthrough
projects have crossed the ‘proof-of concept’ stage and ventured into
advanced stages. The Company has successfully conducted trials on Environment friendly products such as polysteel and chrome free
an innovative process to make use of non-coking coal along with passivation based coatings have been developed for the ECA
coking coal. Amongst the notable new developments, a new process (Emerging Corporate Accounts) business. Polysteel has the potential
to produce high purity iron powder using in-plant byproducts has to eliminate the dependency on 7 tank degreasing process, which
been developed. A grade of the said iron powder with high sinter results in environmentally hazardous discharge. In addition,
ability and superior toughness properties has been tested and polysteel also provides long-term corrosion protection, better
commercialised for Diamond cutting tools. surface finish, anti-fingerprint surface and high scratch resistance.
Chrome free passivation in galvanised products is environment
In Europe, Research & Development has contributed to several
friendly and eliminates requirement of oiling. The trials are successful
new products. The range of Prime Lubrication Treatment has
for clean room partition panels and supply for appliance segment will
been extended to the MagiZinc protective galvanising coating.
be initiated shortly. Services and solution, a new business vertical,
XPF1000 has been launched as a new ultra-high strength steel grade
successfully launched Tata Pravesh vista windows, an extension of the
for the Chassis & Suspension market, and a new range of hybrid
existing product, Tata Pravesh doors. Vista windows were launched
sandwich panels is now available for Construction via Building
with 3 novel design elements: unique slide cum swing, concealed
Systems. Further, Research and Development has also been vital in
spring loaded auto lock tower bolt, and gas spring assist and hold,
getting many potential new products to reach higher Technology
providing comfort and safety.
Readiness levels throughout the year.
In Europe, 22 new products were launched during the year.
In order to make technology development more effective and robust
These launches include major developments for the automotive,
for the Company in the future, the cross-functional delivery of the TSE
construction, and engineering markets. Notable example of product
technology roadmap is now coordinated via a new committee, the
and service launches includes XPF1000. XPF1000, latest addition to
Central Technology Committee, chaired by the Director R&D Europe
Tata Steel’s XPF hot rolled product family for the automotive chassis
and sponsored by the Chief Technology Officer. This Committee
and suspension market, combines ultra-high 1000MPa tensile
ensures that priorities and gaps in the delivery of technology are
strength with excellent formability and fatigue properties. A new
identified and dealt with in an appropriate manner. Research &
range of 25mm/1’ gauge hot rolled products was developed for
Development continues to provide significant effort towards various
the engineering and yellow goods markets, enabling customers to
research and technology initiatives such as sustainable and more
replace equivalent reversing mill plate offerings and to achieve better
environment friendly steel production through the HIsarna project
part yield and surface finish. Improved Colorcoat® prepainted steels
that has progressed on the maturity ladder with a formal move from
using Tata Steel’s next generation MagiZinc® hot dip galvanised
the HIsarna pilot plant from an R&D environment to full integration
coating for optimised product longevity in construction building
with the MLE manufacturing hub. HIsarna is a novel and more flexible
envelope applications was also developed. Packaging has continued
reduction technology for iron production. In the past year, the
to commercialise its already launched Protact® products, including
HIsarna pilot plant has set several new production records. R&D will
Protact® for food.
continue to support this development way forward.
Customer Relationship
New Product Development
During the year under review, the Company undertook specially
In order to achieve the Company’s endeavour to create superior
designed initiatives to create and maintain long-term relationship
customer experience, the Company has adopted best in class
with channel partners and customers to be the first choice of
manufacturing practices, invested in creating brands, developed
producer. In India, the Company largely caters to B2B, B2C and B2ECA
products keeping customers at the centre, and focussed on
(Emerging Corporate Accounts) customer groups. These segments
environment and safety. Furthermore, the Company is steadily
are further bifurcated into micro segments based on application
venturing into a new gamut of solutions and ready to use products
and buying behaviour. The Company focusses to understand
for further value creation.
the expectations and requirements of current and potential
During the year under review, the Company developed 114 new customers/market segments to deliver customer specific products
products in India. Tata Steel Kalinganagar plant played a key role and services and provide value-creating solutions.
by developing 61 products such as high strength steel grades for
During the year under review, the Company organised its
global players in Lifting & Excavation, and Pre-Engineered Building
biennial ‘Driving Steel’ summit on Automotive Steels. The summit
(PEB) manufacturers, approval upto API 5L X60 grade from state
brought together industry experts including automotive majors
owned Natural Gas Processing & Distribution company for Oil & Gas
and ancillaries, from around the globe as well as from India.
pipelines and the first approvals of hi-tensile (590MPa) grades in
The knowledge summit facilitated the Company to develop
automotive applications. In addition, the products developed have
insightful understanding of the emerging trends in the automotive
also helped ‘Tata Astrum’ to enter in the Transmission & Distribution
industry, and to help build new partnerships. The Company engages
segment with high strength grade of ASTM A572 Gr 65.
with B2B customers through cross-functional Customer Service
Teams (‘CSTs’) to work on new product development, quality
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BOARD’S REPORT
improvement and value-creating ideas which help to achieve Europe this year. These launches include major developments for
operational excellence. In addition, the Company has collaborated the automotive, construction, and engineering markets. Along with
with key automotive customers to provide cost and weight products, the Company also offers services such as Electronic Data
reduction solutions using the Value Analysis & Value Engineering Interchange, Track and Trace, Early Vendor Involvement, Design
(‘VAVE’) platform and the Advanced Product Application support. and Engineering support, Building Information Modelling, Life
This has also enabled the Company to partner with discerning Cycle Analysis and Technical Support. In addition, the Company
customers for future product launches. Engagement through CST has a commercial improvements programme called ‘Future
and VAVE is deployed to B2B customers of Industrial Products and Commercial Excellence’ which focusses on driving improvements for
Projects Vertical. Senior leadership team actively engaged with commercial terms.
leading B2B customers by visiting premises of customers and
attending exclusive interacting sessions organised across regions. Human Resources Management & Industrial Relations
Human resource has always been one of the most valued stakeholders
Collaborative Reform with ECA for Advanced Technical Enhancement
for Tata Steel. The Company is committed towards creating and
(‘CREATE’) was conceptualised to provide support to various ECA
maintaining an ideal work culture for engaged and capable workforce
customers by generating cost and weight savings via redesigning
to deliver for the future. Tata Steel has strong values, pioneering
of components. Platforms such as APPLICON (Appliance segment),
practices, a culture of working together through joint consultation
and PANORAMA (Panel segment) were conceived to gain
between Union and Management and a very strong commitment
deeper understanding and engagement with microsegments.
towards community development. Our people practices have always
These platforms witnessed participation of Original Equipment
been centered around employee welfare and wellness, creating an
Manufacturers (‘OEM’) from consumer durable industry and provided
environment of collaboration and connect which has aided us to
an opportunity to engage with policy making bodies such as CEAMA
achieve industrial harmony of over 90 years.
(Consumer Electronics & Appliance Manufacturers Association), and
COSMA (Control Panel and Switchgear Manufacturers’ Association) Improving employee productivity is of utmost importance to
and to enable all stakeholders to understand the upcoming the organisation and achieving benchmark performance in this
technologies in the microsegments. area year-on-year is the goal for the organisation. This led to an
improvement in productivity from 769 tonnes of crude
During the year under review, the Company also rolled out various
steel/employee/year to 800 tonnes of crude steel/employee/year
digital initiatives across customer groups. ‘Aashiyana’, an e-selling
and the employees on roll moving from 34,072 to 32,984.
platform has been launched for multiple B2C brands and has
crossed a turnover of `100 crore. ‘COMPASS’, a digital supply chain The year under review was a milestone year for the Company as it
visibility solution rolled out to select B2B customers, generated embarked on major improvements in areas related to diversity and
122KT of sales this year. DigEca, an initiative that captures lead inclusion. Various initiatives such as Wings, an employee resource
management for ECAs has achieved 659 KT sales enquiries group for LGBTQ+; Take Two, a career opportunity for women on a
and 375 KT purchase orders making the process convenient break; Step-up-to-success, an in-house women’s mentoring program;
for the customers. Deployment of women in B-shift operations; and Paternity leave for
blue collared workforce, were introduced to bring about a change in
In services & solutions space, select platforms have been developed
the culture and mindset of the workforce with regard to the aspects of
to understand the consumer decision making, such as the ‘Consumer
diversity and inclusion. The focus for the year was on Gender diversity
Connect’ programme wherein the lady of the house is invited to
and Differently Abled Persons. Efforts have been taken on hiring and
join the program, visit exclusive retail outlet for experience and
creating infrastructure for diverse workforce as well as retaining and
have an option of display van carrying the product closer to the
developing women leaders to create a pool of diverse talent in the
consumer and ‘consultative selling’ wherein a sales expert helps in
organisation. Our continuous efforts in this direction have led to the
product demonstration.
increase in gender diversity from 6.1% to 6.5% of the total workforce.
In Europe, the Company partners with customers to help them excel
Continuing the capability development journey, the Capability
in their market, co-creating more sustainable value throughout the
Development wing, during the year, started serving external clients
entire value chain. ‘Customer Focus’, contains several company wide
as well as generating a revenue through their products and services.
and local programmes such as Strategic Account Management
programme that reinforce our mission and drive towards customer The Management has been focusing on digitalisation since past
centricity. Improvements on this front have also been acknowledged few years. During the year under review, the role of digitalisation
in the Tata Business Excellence Model assessment. The Company in providing a rich employee experience has been immense.
also has a value chain transformation programme known as The Company launched the first HR Chat-bot – ‘Amigo’ to provide
‘Future Value Chain’ programme, which focusses on driving service interactive resolutions to the queries pertaining to HR policies.
and quality improvements. European operations are also focusing The year has also been significant for Digital HR owing to the major
on a balanced portfolio and differentiation strategy, which aims to involvement of teams in designing and development of a customised
increase the proportion of high-margin differentiated products. HRM Talent Suite. Data analytics and reporting have become key
As part of the strategy, the Company launched 22 new products in inputs in formulating policies and strategies for the Company.
During the year under review, the Company acquired Bhushan Steel The Company is working closely with tribal communities in its
Limited (renamed Tata Steel BSL Limited). The seamless integration of areas of operation in India. The Company has partnered with State
the newly acquired organisation with Tata Steel was ensured through Governments of Jharkhand and Odisha and with various reputed
deployment of the Company’s employees in the key functional national and international development organisations in delivering
areas such as Safety, Ethics, Supply Chain, etc. and senior leadership its programmes.
positions and by adopting and implementing various policies
The Company has in place a CSR policy which provides guidelines to
and practices. Trust was built among the workforce by bringing in
conduct CSR activities of the Company. The CSR policy is available on
transparency and openness in the system and by imbibing Tata
the website of the Company www.tatasteel.com
Philosophy across the value chain.
During the year under review, the Company spent `314.94 crore on
During the year under review, Tata Steel was certified as Great Place
CSR activities. The Annual Report on CSR activities, in terms of Section
to Work in the Great Place to Work study conducted for the year 2019.
135 of the Companies Act, 2013 and the Rules framed thereunder, is
Tata Steel was declared as one of the top 25 ‘India’s Best Places to
annexed to this report (Annexure 3).
Work in the Manufacturing sector’ by Great Place to Work. Tata Steel
also secured 8th rank in the ‘Best Companies to work for’ survey In Europe, the Company focusses on local Communities. The Company
by Business Today and featured in the top 10 companies for the nurtures and sustains the communities close to its operational plants.
2nd year in a row. Tata Steel won the Golden Peacock Award for HR The Company conducts regular dialogues with these communities to
Excellence (Steel Sector) in 2019. This recognition was bestowed on understand and address their concerns. The Company is transparent
the Company for the 2nd year in a row. The Company was conferred with information on the environmental impact of its activities, as
with CII Eastern Region Productivity Award for overall improvement well as its goals and improvement targets. Local communities are
in productivity. part of the sustainable economy as we help each other to co-exist
successfully with a good understanding of the mutual benefits that
In Europe, the Company continues to invest in the recruitment,
we provide to one another. The Company runs regular programmes
engagement, health and development of its employees. The Tata
to invite the public to see our work and also enjoy and see the
Steel Academy in Europe aims to strengthen the organisation’s
important wildlife and flora that flourish on its sites. The Company
competitive advantage by enabling its people to achieve the
sponsors local activities and support charities. In IJmond, the
highest standards of technical and professional expertise, with a
Company celebrated the annual Tata Steel Chess Tournament that
combined use of practical ‘on the job’, virtual and classroom training
attracts thousands of players and spectators and boosts the local
to maximise training effectiveness. The Company aims to offer
tourism economy in the off-season in January. We sponsor local
modern employment conditions that ensure healthy long-term
sports teams and children’s events, most notably in recent years the
employability and are responsive to the needs of both current and
Tata Kids of Steel® triathlons. We also engage with communities as
future employees. In Europe, the Company strives to ensure that
an existing and potential workforce, running programmes to involve
the employees’ motivation and capabilities are enhanced by its
young people, and girls in particular, so that they can discover the
leaders, organisational structure, operational protocols, including
interesting career opportunities that our organisation offers.
daily management and operational excellence programmes,
communication processes & business excellence and reward and
I. Corporate Governance
recognition policies. The Company also focusses on promoting
physical health through various central and local programmes and At Tata Steel, we ensure that we evolve and follow the corporate
provides training and support to promote mental health inside and governance guidelines and best practices dilligently, not just to
outside the workplace. boost long-term shareholder value but also to respect minority
rights. We consider it our inherent responsibility to disclose timely
Corporate Social Responsibility and accurate information regarding the operations & performance,
The Company’s vision is to be a global benchmark in ‘value creation’ leadership and governance of the Company.
and ‘corporate citizenship’. The objective of the Company’s Corporate In accordance with the Tata Steel Group’s Vision, the Tata Steel Group
Social Responsibility (‘CSR’) initiatives is to improve the quality of life aspires to be the global steel industry benchmark for value creation
of communities through long-term value creation for all stakeholders. and corporate citizenship. The Tata Steel Group expects to realise its
For decades, the Company has pioneered various CSR initiatives. Vision by taking such actions as may be necessary in order to achieve
The Company continues to remain focussed on improving the quality its goals of value creation, safety, environment and people.
of life. During the year under review, the Company impacted the Pursuant to the Listing Regulations, the Corporate Governance Report
lives of more than a million children, women and men from our along with the Certificate from a Practicing Company Secretary,
communities through initiatives in health, drinking water, certifying compliance with conditions of Corporate Governance, is
education, livelihood, sports, infrastructure development, etc. annexed to this report (Annexure 4).
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BOARD’S REPORT
Board Meetings governance, safety, health and environment, industry & regulatory
For seamless scheduling of meetings, a calendar is prepared and trends, competition and future outlook are available on the website
circulated in advance. The Board met 7 times during the year under of the Company www.tatasteel.com
review, the details of which are given in the Corporate Governance
Evaluation
Report. The intervening gap between the meetings was within
the period prescribed under the Companies Act, 2013 and the The Board evaluated the effectiveness of its functioning, that of the
Listing Regulations. Committees and of individual Directors.
The Board sought the feedback of Directors on various
Selection of new Directors and Board Membership Criteria
parameters including:
The Nomination and Remuneration Committee (‘NRC’) works with
the Board to determine the appropriate characteristics, skills and • Degree of fulfillment of key responsibilities towards stakeholders
experience for the Board as a whole as well as for its individual (by way of monitoring corporate governance practices,
members with the objective of having a Board with diverse participation in the long-term strategic planning, etc.);
backgrounds and experience in business, government, education • Structure,
composition and role clarity of the Board
and public service. Characteristics expected of all Directors include and Committees;
independence, integrity, high personal and professional ethics,
sound business judgement, ability to participate constructively in • Extent of co-ordination and cohesiveness between the Board and
deliberations and willingness to exercise authority in a collective its Committees;
manner. The Company has in place a Policy on appointment & • Effectiveness of the deliberations and process management;
removal of Directors (‘Policy’).
• Board/Committee culture and dynamics; and
The salient features of the Policy are:
• Quality of relationship between Board Members and
• It acts as a guideline for matters relating to appointment and the Management.
re-appointment of directors.
The Chairman of the Board had one-on-one meeting with the
• It contains guidelines for determining qualifications, positive Independent Directors (‘IDs’) and the Chairman of NRC had
attributes for directors, and independence of a Director one-on-one meeting with the Executive and Non-Executive,
• It lays down the criteria for Board Membership Non-Independent Directors. These meetings were intended to obtain
Directors’ inputs on effectiveness of the Board/Committee processes.
• It sets out the approach of the Company on board diversity
The Board considered and discussed the inputs received from the
• It lays down the criteria for determining independence of a Directors. Further, the IDs at their meeting reviewed the performance
director, in case of appointment of an Independent Director of the Non-Independent Directors, the Board as a whole and
The Policy was adopted by the Board on March 31, 2015 and the Chairman of the Board after taking into account views of Executive
same was revised on March 29, 2019 to incorporate the changes Directors and other Non-Executive Directors.
in regulatory requirements pertaining to criteria for determining The evaluation process endorsed the Board Members’ confidence
independence of a director. in the ethical standards of the Company, cohesiveness amongst the
The Policy is available on the website of the Company Board Members, constructive relationship between the Board and
www.tatasteel.com the Management and the openness of the Management in sharing
strategic information to enable Board Members to discharge their
Familiarisation Programme for Directors responsibilities.
All new Directors (including Independent Directors) inducted In the coming year, the endeavour is to enhance focus on
to the Board go through a structured orientation programme. de-leveraging Balance Sheet (Reduction of debt) and making the
Presentations are made by Senior Management giving an overview of European Operations more sustainable.
the operations, to familiarize the new Directors with the Company’s
business operations. The new Directors are given an orientation on Remuneration Policy for the Board and Senior Management
the products of the business, group structure and subsidiaries, Board Based on the recommendations of the NRC, the Board has approved
constitution and procedures, matters reserved for the Board, and the the Remuneration Policy for Directors, Key Managerial Personnel
major risks and risk management strategy of the Company. Visits to (‘KMPs’) and all other employees of the Company. As part of the
plant and mining locations are organised for the new Directors to policy, the Company strives to ensure that:
enable them to understand the business better.
• thelevel and composition of remuneration is reasonable and
During the year under review, no new Independent Directors were sufficient to attract, retain and motivate Directors of the quality
inducted to the Board. Details of orientation given to the existing required to run the Company successfully;
independent directors in the areas of strategy, operations &
• relationship between remuneration and performance is clear and Inductions to the Board
meets appropriate performance benchmarks; and On the recommendations of the Nomination and Remuneration
• remuneration to Directors, KMP and Senior Management involves Committee, the Board appointed Mr. Vijay Kumar Sharma as
a balance between fixed and incentive pay, reflecting short, Additional (Non-Executive) Director of the Company effective
medium and long-term performance objectives appropriate to the August 24, 2018. Mr. Sharma brings to Board valued insights and
working of the Company and its goals. perspectives on complex financial and operational issues.
The Remuneration Policy for Directors, KMPs and other Employees The resolution for confirming the appointment of Mr. Vijay Kumar
was adopted by the Board on March 31, 2015. Sharma as Director of the Company forms part of the Notice
convening the Annual General Meeting (‘AGM’) scheduled to be held
The salient features of the Policy are: on July 19, 2019.
• Itlays down the parameters based on which payment of
Re-appointments
remuneration (including sitting fees and commission) should
be made to Independent Directors (IDs) and Non-Executive In terms of the provisions of the Companies Act, 2013,
Directors (NEDs). Mr. Koushik Chatterjee retires by rotation at the ensuing AGM and
being eligible, seeks re-appointment.
• Itlays down the parameters based on which remuneration
(including fixed salary, benefits and perquisites, bonus/ During the year under review, based on the recommendations
performance linked incentive, commission, retirement benefits) of Nomination and Remuneration Committee (‘NRC’), the Board
should be given to whole-time directors, KMPs and rest of re-appointed Mr. T. V. Narendran as Chief Executive Officer &
the employees. Managing Director of the Company for a period of five years effective
September 19, 2018, not liable to retire by rotation. The Board
• It lays down the parameters for remuneration payable to Director approved the re-appointment of Mr. Narendran based on his
for services rendered in other capacity. significant contributions to the Company and the same is subject to
During the year under review, there have been no changes to the approval of the Members of the Company.
the Policy. The Policy is available on the website of the Company Based on the recommendations of the NRC and pursuant
www.tatasteel.com to the performance evaluation of Ms. Mallika Srinivasan as
a Member of the Board, the Board proposed to re-appoint
Particulars of Employees
Ms. Srinivasan as an Independent Director of the Company, not
Disclosures pertaining to remuneration and other details as required liable to retire by rotation, to hold office for a second term effective
under Section 197(12) of the Companies Act, 2013, read with Rule 5(1) August 14, 2019 through May 20, 2022.
of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are annexed to this report (Annexure 5). Also, based on the recommendation of the NRC and pursuant
to the performance evaluation of Mr. O. P. Bhatt as a Member of
In terms of the provisions of Section 197(12) of the Companies Act, the Board, the Board proposed to re-appoint Mr. O. P. Bhatt as an
2013 read with Rules 5(2) and 5(3) of the Companies (Appointment Independent Director of the Company, not liable to retire by rotation,
and Remuneration of Managerial Personnel) Rules, 2014, a statement to hold office for a second term effective August 14, 2019 through
showing the names and other particulars of employees drawing June 9, 2023.
remuneration in excess of the limits set out in the said Rules forms
part of this report. The necessary resolutions for re-appointments of
Mr. Koushik Chatterjee, Mr. T. V. Narendran, Ms. Mallika Srinivasan and
Independent Directors’ Declaration Mr. O. P. Bhatt form part of the notice convening the ensuing AGM
The Company has received the necessary declaration from each scheduled to be held on July 19, 2019.
Independent Director in accordance with Section 149(7) of the The profile and particulars of experience, attributes and skills of the
Companies Act, 2013, read with Regulations 16 and 25(8) of the above Directors is disclosed in the Notice convening the AGM to be
Listing Regulations that he/she meets the criteria of independence as held on Friday, July 19, 2019.
laid out in Section 149(6) of the Companies Act, 2013 and Regulations
16(1)(b) and 25(8) of the Listing Regulations. Cessation
Mr. D. K. Mehrotra stepped down as a Member of the Board effective
Directors
May 16, 2018. Mr. Mehrotra joined the Board as a Non-Executive
The year under review saw the following changes to the Board of Director on October 22, 2012.
Directors (‘Board’).
The Board of Directors places on record its appreciation towards
Mr. Mehrotra’s contributions during his tenure as Director
of the Company.
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BOARD’S REPORT
Key Managerial Personnel Committee. The Internal Audit team develops an annual audit plan
Pursuant to Section 203 of the Companies Act, 2013, the Key based on the risk profile of the business activities. The Internal
Managerial Personnels of the Company as on March 31, 2019 Audit plan is approved by the Audit Committee, which also reviews
are – Mr. T. V. Narendran, Chief Executive Officer & Managing compliance to the plan.
Director, Mr. Koushik Chatterjee, Executive Director & The Internal Audit team monitors and evaluates the efficacy and
Chief Financial Officer and Mr. Parvatheesam K, Company adequacy of internal control systems in the Company, its compliance
Secretary & Chief Legal Officer (Corporate & Compliance). with operating systems, accounting procedures and policies at all
During the year under review, there has been no change in the locations of the Company and its subsidiaries. Based on the report
Key Managerial Personnels. of internal audit function, process owners undertake corrective
action(s) in their respective area(s) and thereby strengthen the
Audit Committee
controls. Significant audit observations and corrective action(s)
The Audit Committee was constituted in the year 1986. The thereon are presented to the Audit Committee.
Committee has adopted a Charter for its functioning. The primary
objective of the Committee is to monitor and provide effective The Audit Committee at its meetings reviews the reports submitted
supervision of the Management’s financial reporting process, to by the Internal Auditor. Also, the Audit Committee at frequent
ensure accurate and timely disclosures, with the highest levels of intervals has independent sessions with the statutory auditor and
transparency, integrity and quality of financial reporting. the Management to discuss the adequacy and effectiveness of
internal financial controls.
The Committee met 5 times during the year under review, the details
of which are given in the Corporate Governance Report. As on Risk Management
March 31, 2019, the Committee comprises Mr. O. P. Bhatt (Chairman), Given the uncertain and volatile business environment, companies
Mr. Aman Mehta, Dr. Peter Blauwhoff and Mr. Saurabh Agrawal. face continuous changes in technology, geo-politics, financial
markets, regulations, etc. which affect the value chain. To build a
Internal Control Systems and Internal Audit
sustainable business that can weather these changes, companies
The Board of Directors of the Company is responsible for ensuring need to manage risk and opportunities on a pro-active basis.
that Internal Financial Controls have been laid down in the
Company and that such controls are adequate and operating Keeping this in mind, the Company has adopted a robust Enterprise
effectively. The Internal Financial Controls (‘IFC’) are based on the Risk Management (‘ERM’) process across the organisation.
Tata Code of Conduct (‘TCoC’), policies and procedures adopted by The objective of the ERM process is to develop a ‘risk intelligent’
the Management, corporate strategies, annual business planning culture which drives informed decision making and builds resilience
process, management reviews, management system certifications to adverse developments while ensuring that opportunities are
and the risk management framework. exploited to create value for all stakeholders. In order to achieve this,
the Company focusses on 4 broad principles viz. risk oversight, risk
The Company has an IFC framework, commensurate with the size, Infrastructure, risk process and ownership, and risk integration.
scale and complexity of the Company’s operations. The framework
has been designed to provide reasonable assurance with respect • The Risk oversight function consists of the Board of Directors,
to recording and providing reliable financial and operational Risk Management Committee (‘RMC’) and Group Risk Review
information, complying with applicable laws, safeguarding assets Committee (‘GRRC’) to oversee the risk management policy, to
from unauthorised use, executing transactions with proper provide guidelines for implementing the ERM framework and ERM
authorisation and ensuring compliance with corporate policies. process across the Company. The RMC also reviews the key risks
The controls, based on the prevailing business conditions and that the Company faces and the progress of the mitigation plans.
processes have been tested during the year and no reportable GRRC is a Management Committee comprising the Senior
material weakness in the design or effectiveness was observed. Management team as its members. The GRRC is responsible for
The framework on Internal Financial Controls over Financial the implementation of ERM process across the Company and
Reporting has been reviewed by the internal and external auditors. providing the necessary resources, framework & structures to
The Company uses various IT platforms to keep the IFC framework enable the ERM. The GRRC reviews the risks and the proposed
robust and our Information Management Policy governs these IT mitigation plans and engages with risk owners regularly across the
platforms. The systems, standard operating procedures and controls business to drive mitigation.
are implemented by the executive leadership team and are reviewed A dedicated ERM team has been set up to deploy the ERM process
by the internal audit team whose findings and recommendations are across the Business Units. The ERM team is led by Group Head –
placed before the Audit Committee. Corporate Finance & Risk Management who acts as the Chief Risk
The scope and authority of the Internal Audit function is defined in the Officer (CRO) of the Company. The CRO regularly reports to the
Internal Audit Charter. To maintain its objectivity and independence, RMC and the GRRC on the progress of the implementation of ERM
the Internal Audit function reports to the Chairman of the Audit and the various risks faced by the Company
• The Company has developed a 5 step ERM process (establish the Management any actual or possible violation of the TCoC or any
context, risk identification, risk assessment & evaluation, event wherein he or she becomes aware of any event that could
mitigation and monitor, review & report), which takes inputs from affect the business or reputation of the Company.
international standards and references such as Committee of
The Whistle Blower Reward and Recognition Guidelines for
Sponsoring Organisation of the Treadway Commission (‘COSO’),
employees has been implemented to encourage employees to
ISO 31000 and best practices from industries across the globe.
report genuine misconduct or unethical activity taking place in the
For better efficacy, the process is deployed using a ‘top down’ and
Company. The disclosures reported are addressed in the manner and
‘bottom up’ approach.
within the time frames prescribed in the Whistle Blower Policy.
• The Company strives to integrate the ERM process with the existing The Whistle Blower Protection Policy for Business Associates including
management processes and embed it across the Company.
vendors and customers provides protection to Business Associates
The top-down risks in conjunction with the bottom up risks
from any victimisation or unfair trade practices by the Company.
identified by the Business Units drive the strategy and the capital
allocation of the Company. The Company has adopted a Policy for Receipts of Gift and Hospitality
that requires its employees to take the right decisions when they
During the year under review, the Company has been continuously
are offered gifts or hospitality while conducting business or official
working on strengthening the ERM process including facilitating the
transactions on behalf of the Company. The Company has also
top-down risk assessment process, deploying various analytical tools
adopted a Conflict of Interest policy. The policy requires employees
to analyse the risks, and strengthening the integration with strategy,
to act in the best interest of the Company without any conflicts and
capital allocation and internal audit. The strengthening has also
declare conflicts, if any (real, potential or perceived).
enhanced coverage of ERM across the Company with the ERM roll
out to new business units and domestic subsidiaries. During the year under review, the Company undertook a series of
communication and training programmes for internal stakeholders
During the year under review, the Company was declared as Winner
and vendors, with the aim to create awareness about Tata values, TCoC
of ‘Golden Peacock Award for Risk Management’ for 2018 for
and other ethical practices of the Company. The Company undertook
attaining significant achievements in the field of Risk Management.
various theme based campaigns, town hall and departmental events.
The Company was also awarded the India Risk Management Awards
‘Neeti Katha’ i.e. storytelling through snippet series on scenarios of
for Best Risk Management Framework & Systems under the ‘Metals &
‘The ethics of safety’ and ‘Trust Behaviour’ were mailed to employees
Mining’ and ‘Risk Governance’ categories for the second year in a row.
as part of the awareness campaign. The Company also celebrates the
Vigil Mechanism month of July as Ethics Month. All communications and programmes
are theme based. This practice has helped in reinforcing employee
Commitment towards highest moral and ethical standards in the
involvement in driving the MBE.
conduct of business is of utmost importance to the Company.
To advance standards of ethical practices, the Company has deployed The Company’s robust system to raise concerns on unethical
the Management of Business Ethics (‘MBE’) across the organisation behaviour, efforts undertaken to make stakeholders aware of such
through a well-defined framework. systems as well as of their responsibility to report such concerns,
practice of non-retaliation and strong mechanism to address such
The Company also has a Vigil Mechanism that provides a formal
concerns instills in our stakeholders the confidence to report any
channel for all its Directors, employees and vendors to approach
ethical violations.
the Ethics Counselor/Chairman of the Audit Committee and make
protective disclosures about the unethical behaviour, actual or Related Party Transactions
suspected fraud or violation of the Tata Code of Conduct (‘TCOC’).
During the year under review, the Company did not have any
In order to adhere to the highest of the ethical standard, the vigil contracts or arrangements with related parties in terms of
Mechanism includes policies viz. the Whistle Blower Policy for Section 188(1) of the Companies Act, 2013.
Directors & Employees, the Whistle Blower Policy for Business
Accordingly, particulars of contracts or arrangements with related
Associates, the Whistle Blower Protection Policy for Business
parties referred to in Section 188(1) of the Companies Act, 2013
Associates (vendors/customers), the Policy for Receipts of Gift and
along with the justification for entering into such contracts or
Hospitality and the Conflict of Interest Policy for Employees.
arrangements in Form AOC-2 does not form part of the report, as the
The Whistle Blower Policies for Directors & Employees and Business same is not applicable.
Associates are an extension of the TCoC that encourage every
Director, employee and Business Associate to promptly report to
105
BOARD’S REPORT
Disclosure as per the Sexual Harassment of Women at e) that proper systems to ensure compliance with the provisions
Workplace (Prevention, Prohibition and Redressal) Act, 2013 of all applicable laws were in place and that such systems were
adequate and operating effectively.
The Company has zero tolerance towards sexual harassment at
the workplace. The Company has adopted a Policy on Prevention, Business Responsibility Report
Prohibition and Redressal of Sexual Harassment at Workplace in
The Securities and Exchange Board of India (‘SEBI’) requires
line with the provisions of the Sexual Harassment of Women at
companies to prepare and present to stakeholders a Business
Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the
Responsibility Report (‘BRR’) in the prescribed format. SEBI, however,
Rules thereunder.
allows companies to follow an internationally recognized framework
The Company has complied with the provisions relating to the to report on the environmental and social initiatives undertaken
constitution of the Internal Complaints Committee as per the Sexual by the Company. Further, SEBI has on February 6, 2017 advised
Harassment of Women at Workplace (Prevention, Prohibition and companies that are required to prepare BRR to transition towards an
Redressal) Act, 2013. Integrated Report.
During the year under review, the Company received 20 complaints As stated earlier in the Report, the Company has followed the
of sexual harassment, out of which 19 complaints have been resolved <IR> framework of the International Integrated Reporting Council
by taking appropriate actions. The 1 pending complaint is under to report on all the six capitals that are used to create long-term
investigation as on the date of this report. stakeholder value. Our Integrated Report has been assessed and
KPMG has provided the required assurance. We have also provided
Directors’ Responsibility Statement the requisite mapping of principles between the Integrated Report,
Based on the framework of internal financial controls established the Global Reporting Initiative (‘GRI’) and the BRR as prescribed by
and maintained by the Company, work performed by the internal, SEBI. The same is available on our website www.tatasteel.com.
statutory, cost and secretarial auditors and external agencies
including audit of internal financial controls over financial reporting Subsidiaries, Joint Ventures and Associates
by the statutory auditors and the reviews performed by Management We have 237 subsidiaries and 54 associate companies (including
and the relevant Board Committees, including the Audit Committee, 28 joint ventures) as on March 31, 2019. During the year under review,
the Board is of the opinion that the Company’s internal financial the Board of Directors reviewed the affairs of material subsidiaries.
controls were adequate and effective during Financial Year 2018-19. We have, in accordance with Section 129(3) of the Companies Act,
2013 prepared the consolidated financial statements of the Company
Accordingly, pursuant to Section 134(5) of the Companies Act,
and all its subsidiaries, which form part of the Integrated Report.
2013, the Board of Directors, to the best of its knowledge and
Further, the report on the performance and financial position of each
ability confirms:
subsidiary, associate and joint venture and salient features of their
a) that in the preparation of the annual accounts, the applicable Financial Statements in the prescribed Form AOC-1 is annexed to this
accounting standards have been followed and that there were report (Annexure 6).
no material departures;
In accordance with the provisions of Section 136 of the Companies
b) that we have selected such accounting policies and applied Act, 2013 and the amendments thereto, read with the Listing
them consistently and made judgements and estimates that are Regulations, the audited Financial Statements, including the
reasonable and prudent so as to give a true and fair view of the Consolidated Financial Statements and related information of the
state of affairs of the Company at the end of the financial year Company and financial statements of the subsidiary companies will
and of the profit of the Company for that period; be available on our website www.tatasteel.com. These documents
will also be available for inspection during business hours at the
c)
that proper and sufficient care has been taken for the
Registered Office of the Company and will also be kept open at the
maintenance of adequate accounting records in accordance
venue of AGM till the conclusion of AGM.
with the provisions of the Companies Act, 2013 for safeguarding
the assets of the Company and for preventing and detecting The names of companies that have become or ceased to be
fraud and other irregularities; subsidiaries, and associates (including joint venture companies) are
disclosed in an annexure to this report (Annexure 7).
d)
that the annual accounts have been prepared on a
going concern basis; Auditors
e)
that proper internal financial controls were laid down and Statutory Auditors
that such internal financial controls were adequate and were
Members of the Company at the AGM held on August 8, 2017,
operating effectively; and
approved the appointment of Price Waterhouse & Co Chartered
Accountants LLP (‘PW’), Chartered Accountants, as the statutory
auditors of the Company for a period of five years commencing from The extract of Annual Return in Form MGT 9 as per provisions of the
the conclusion of the 110th AGM held on August 8, 2017 until the Companies Act, 2013 and Rules thereto is available on the Company’s
conclusion of 115th AGM of the Company to be held in the year 2022. website at https://www.tatasteel.com/media/9083/mgt-9.pdf
The report of the Statutory Auditor forms part of the Annual Report. Significant and Material Orders passed by the Regulators or
The said report does not contain any qualification, reservation, Courts
adverse remark or disclaimer. During the year under review, the
There have been no significant and material orders passed by the
Auditors did not report any matter under Section 143 (12) of the
regulators or courts or tribunals impacting the going concern status
Act, therefore no detail is required to be disclosed under Section
and the Company’s future operations. However, Members’ attention
134(3)(ca) of the Act.
is drawn to the statement on contingent liabilities, commitments in
Cost Auditors the notes forming part of the Financial Statements.
In terms of Section 148 of the Companies Act, 2013 (‘Act’), the Particulars of Loans, Guarantees or Investments
Company is required to maintain cost records and have the audit
Particulars of loans, guarantees given and investments made
of its cost records conducted by a Cost Accountant. Cost records
during the year under review in accordance with Section 186 of the
are made and maintained by the Company as required under
Companies Act, 2013 is annexed to this report (Annexure 10).
Section 148(1) of the Act. The Board of Directors of the Company
has, on the recommendation of the Audit Committee, approved Energy Conservation, Technology Absorption and Foreign
the appointment of M/s Shome & Banerjee as the cost auditors of Exchange Earnings and Outgo
the Company (Firm Registration No. 000001) for the year ending
Details of the energy conservation, technology absorption
March 31, 2020.
and foreign exchange earnings and outgo are annexed to this
In accordance with the provisions of Section 148(3) of the Act read report (Annexure 11).
with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the
remuneration payable to the Cost Auditors as recommended by the Deposits
Audit Committee and approved by the Board has to be ratified by During the year under review, the Company has not accepted any
the Members of the Company. Accordingly, appropriate resolution deposits from public in terms of the Companies Act, 2013. Further, no
forms part of the Notice convening the AGM. We seek your support amount on account of principal or interest on deposits from public
in ratifying the proposed remuneration of `20 lakh plus applicable was outstanding as on the date of the balance sheet.
taxes and reimbursement of out-of-pocket expenses payable to the
Cost Auditors for the Financial Year ending March 31, 2020. Secretarial Standards
The Company has in place proper systems to ensure compliance
M/s Shome & Banerjee have vast experience in the field of cost
with the provisions of the applicable secretarial standards issued by
audit and have been conducting the audit of the cost records of the
The Institute of Company Secretaries of India and such systems are
Company for the past several years.
adequate and operating effectively.
The Cost Audit Report of the Company for the Financial Year
ended March 31, 2018 was filed by the Company in XBRL mode on J. Acknowledgements
August 21, 2018. We thank our customers, vendors, dealers, investors, business
associates and bankers for their continued support during the year.
Secretarial Auditors
We place on record our appreciation of the contribution made by
Section 204 of the Companies Act, 2013 inter alia requires every listed employees at all levels. Our resilience to meet challenges was made
company to annex to its Board’s report, a Secretarial Audit Report, possible by their hard work, solidarity, co-operation and support.
given in the prescribed form, by a Company Secretary in practice.
We thank the Government of India, the State Governments where
The Board appointed Parikh & Associates, Practicing Company we have operations, Governments of various countries and other
Secretaries, as the Secretarial Auditor to conduct Secretarial Audit government agencies for their support and look forward to their
of the Company for the Financial Year 2018-19 and their report is continued support in the future.
annexed to this report (Annexure 8). There are no qualifications,
observations, adverse remark or disclaimer in the said Report.
The Board has also appointed Parikh & Associates as Secretarial On behalf of the Board of Directors
Auditor to conduct Secretarial Audit of the Company for
Financial Year 2019-20. sd/-
N. CHANDRASEKARAN
Extract of Annual Return Mumbai Chairman
The extract of the Annual Return in Form MGT-9, as per provisions April 25, 2019 DIN: 00121863
of the Companies Act, 2013 and Rules thereto, is annexed to this
report (Annexure 9).
107
BOARD’S REPORT | DIVIDEND DISTRIBUTION POLICY
Declaration regarding Compliance by Board Members and Senior Management Personnel with the Code
of Conduct
This is to confirm that the Company has adopted the Tata Code of Conduct for its employees including the Managing Director and the
Whole-time Directors. In addition, the Company has adopted the Tata Code of Conduct for the Non-Executive Directors. Both these Codes are
available on the Company’s website at www.tatasteel.com
I confirm that the Company has in respect of the Financial Year ended March 31, 2019, received from the Senior Management Team of the
Company and the Members of the Board, a declaration of compliance with the Code of Conduct as applicable to them.
For the purpose of this declaration, Senior Management Team means the Members of the Management one level below the Chief Executive
Officer & Managing Director as on March 31, 2019.
sd/-
T. V. NARENDRAN
Chief Executive Officer &
Mumbai Managing Director
April 25, 2019 DIN: 03083605
ANNEXURE 1
Dividend Distribution Policy
1. Preamble 3.4 The Policy reflects the intent of the Company to reward its
shareholders by sharing a portion of its profits after retaining
1.1 The Dividend Distribution Policy (hereinafter referred to as the
sufficient funds for growth of the Company. The Company shall
‘Policy’) has been developed in accordance with the extant
pursue this Policy, to pay, subject to the circumstances and
provisions of the Companies Act, 2013 and SEBI regulations.
factors enlisted hereon, progressive dividend, which shall be
1.2
The Board of Directors (the ‘Board’) of Tata Steel Limited consistent with the performance of the Company over the years.
(the ‘Company’) has adopted the Policy of the Company
as required in terms of Regulation 43A of the SEBI (Listing 4.
Parameters to be considered while declaring
Obligations and Disclosure Requirements) Regulations, 2015 Dividends
(the ‘Listing Regulations’) at its meeting held on April 20, 2017.
4.1 Financial Parameters
1.3 Under Section 2(35) of the Companies Act, 2013, ‘Dividend’ a) Magnitude of current year’s earnings of the Company: Since
includes any interim dividend. In common parlance, ‘dividend’ dividend is directly linked with the availability of earning over
means the profit of a company, which is not retained in the long haul, the magnitude of earnings will significantly
the business and is distributed among the shareholders in impact the dividend declaration decisions of the Company.
proportion to the amount paid-up on the shares held by them.
In case of listed companies, Section 24 of the Companies b) Operating cash flow of the Company: If the Company cannot
Act, 2013 confers on SEBI, the power of administration of the generate adequate operating cash flow, it may need to rely on
provisions pertaining to non-payment of dividend. outside funding to meet its financial obligations and sometimes
to run the day-to-day operations. The Board will consider the same
2. Effective Date before its decision whether to declare dividend or retain its profits.
The Policy shall become effective from the date of its adoption c) Return on invested capital: The efficiency with which the
by the Board i.e. April 20, 2017. Company uses its capital.
d) Cost of borrowings: The Board will analyze the requirement
3. Purpose, Objectives and Scope
of necessary funds considering the long-term or short-term
3.1 The Securities and Exchange Board of India (‘SEBI’) vide its projects proposed to be undertaken by the Company and
Gazette Notification dated July 8, 2016 has amended the the viability of raising funds from alternative sources vis-a-vis
Listing Regulations by inserting Regulation 43A in order to plough back its own funds.
make it mandatory to have a Dividend Distribution Policy in
place by the top five hundred listed companies based on their e) Obligations to lenders: The Company should be able to repay
market capitalisation calculated as on the 31st day of March its debt obligations without much difficulty over a reasonable
of every year. period of time. Considering the volume of such obligations and
time period of repayment, the decision of dividend declaration
3.2 As the Company is one of the top five hundred companies as shall be taken.
on March 31, 2016, the Board has laid down a broad framework
for distribution of dividend to its shareholders and/or retaining f) Inadequacy of profits: If during any financial year, the Board
or plough back of its profits. The Policy also sets out the determines that the profits of the Company are inadequate, the
circumstances and different factors for consideration by the Board may decide not to declare dividends for that financial year.
Board at the time of taking such decisions of distribution or of g) Post dividend EPS: The post dividend EPS can have strong
retention of profits, in the interest of providing transparency to impact on the funds of the Company, thus, impacting the overall
the shareholders. operations on day-to-day basis and therefore, affects the profits
3.3 Declaration of dividend on the basis of parameters in addition and can impact the decision for dividend declaration during a
to the elements of this Policy or resulting in amendment particular year.
of any element or the Policy will be regarded as deviation.
4.2 Proposals for major capital expenditures
Any such deviation on elements of this Policy in extraordinary
circumstances, when deemed necessary in the interests of The Board may also take into consideration the need for
the Company, along with the rationale will be disclosed in the replacement of capital assets, expansion and modernisation or
Annual Report by the Board. augmentation of capital asset including any major sustenance,
improvement and growth proposals.
109
DIVIDEND DISTRIBUTION POLICY
4.3
Agreements with lending institutions/ Bondholders/ 6. Target Dividend
Debenture Trustees 6.1
The Company has adopted a progressive dividend policy,
The decision of dividend pay-out shall also be affected by intending to maintain or grow the dividend each year.
the restrictions and covenants contained in the agreements
6.2 The Company targets to pay dividend up to 50% of profit after tax
as may be entered into with the lenders of the Company
of the Company subject to the applicable rules and regulations.
from time to time.
9. Policy as to how the retained earnings will be 10.4 Dividend when declared shall be first paid to the preference
utilised shareholders of the Company, if any as per the terms and
conditions of their issue.
9.1 The Board may retain its earnings in order to make better use of
the available funds and increase the value of the stakeholders
11. Applicability of the policy
in the long run.
11.1 The Policy shall not apply to:
9.2
The decision of utilisation of the retained earnings of the
Company shall be based on the following factors: • Determination and declaring dividend on preference shares
as the same will be as per the terms of issue approved by
• Long-term strategic plans the shareholders
• Augmentation/Increase in production capacity • Distribution of dividend in kind, i.e. by issue of fully or partly
• Market expansion plan paid bonus shares or other securities, subject to applicable law
• Product expansion plan • Distribution of cash as an alternative to payment of dividend
• Modernisation plan by way of buyback of equity shares
• Diversification of business
• Replacement of capital assets 12. Reporting and Disclosure
• Balancing the Capital Structure by de-leveraging the As prescribed by Regulation 43A of the Listing Regulation,
company this Policy shall be disclosed on the Company’s website and
the Annual report.
• Other such criteria as the Board may deem fit from time
to time.
13. Review of the Policy
10. Provisions in regard to various classes of shares 13.1
This Policy shall be subject to review as may be deemed
necessary as per any regulatory amendments.
10.1 The Company has only one class of equity shareholders and
does not have any issued preference share capital. However, in 13.2 Such amended Policy shall be periodically placed before the
case Company issue different class of equity shares any point Board for adoption immediately after such changes.
in time, the factors and parameters for declaration of dividend
to different class of shares of the Company shall be same as 14. Compliance Responsibility
covered above. Compliance of this Policy shall be the responsibility of the
10.2 The payment of dividend shall be based on the respective rights Company Secretary of the Company who shall have the power
attached to each class of shares as per their terms of issue. to ask for any information or clarifications from the management
in this regard.
10.3 The dividends shall be paid out of the Company’s distributable
profits and/or general reserves, and shall be allocated among
shareholders on a pro-rata basis according to the number of
each type and class of shares held.
111
MANAGEMENT DISCUSSION AND ANALYSIS
ANNEXURE 2
Management Discussion and Analysis
A. Overview The saleable steel production and sales trend over the years is
The following operating and financial review is intended to as follows:
convey the Management’s perspective on the financial and
operating performance of the Company at the end of the PRODUCTION AND SALES OF STEEL DIVISION (k tonnes)
Financial Year 2018-19. This Report should be read in conjunction
Production
with the Company’s financial statements, the schedules and notes Sales
12,980
thereto and other information included elsewhere in the Integrated
12,692
12,237
12,151
Report. The Company’s financial statements have been prepared
11,351
10,973
in accordance with the Indian Accounting Standards (‘Ind AS’)
9,698
9,543
9,073
8,750
complying with the requirements of the Companies Act, 2013, as
amended and regulations issued by the Securities and Exchange
Board of India (‘SEBI’) from time to time.
This report is an integral part of the Board’s Report. Aspects on industry
structure and developments, outlook, risks, internal control systems
and their adequacy, material developments in human resources and FY15 FY16 FY17 FY18 FY19
industrial relations have been covered in the Board’s Report and is
incorporated herein by reference and forms an integral part of this During the Financial Year 2018-19, the saleable steel production
report. Your attention is also drawn to sections on Strategy, Risk and stood at 12.98 MnT which is ~6.07% increase over the previous
Opportunities forming part of the Integrated Report. This section year. The hot metal production for the Financial Year 2018-19 was at
gives significant details on the performance of the Company. 14.24 MnT which is 2.8% increase over previous year. The improvement
in performance is due to stabilisation of operations and the ongoing
B. Tata Steel Group Operations improvement initiatives undertaken by the Company through the
Shikhar25 program. Accordingly, Tata Steel Jamshedpur (‘TSJ’) has
1. Tata Steel India (TSI)
achieved the Indian benchmark in specific consumption of energy,
(` crore)
refractory, pulverised coal injection and coke rate.
FY 19 FY 18
Turnover 70,611 60,519 At Tata Steel Kalinganagar (‘TSK’), the commercial production at Phase-I
EBITDA 20,744 15,800 of 3 MnTPA plant commenced since June 2016 and has achieved the
Profit before tax (PBT), before exceptional 16,341 10,005 rated capacity during the Financial Year 2018-19. TSK strives to maintain
Profit before tax (PBT) 16,227 6,638 a world-class environment in the premises by following environmental
Profit after tax (PAT), before exceptional 10,647 7,536 management systems in accordance with rules and regulations framed
Profit after tax (PAT) 10,533 4,170 by the Government and have comprehensive processes in place for
ensuring health and safety of people, plant and equipment. The plant
a) Operations is designed to have minimal water foot print, by-product gas based
(mn tonnes)
power generation leading to reduction in carbon footprints, Coke
FY 19 FY 18 Change (%)
Dry Quenching technology, zero-effluent discharge and significant
reduction of noise and dust pollution.
Hot Metal 14.24 13.86 3
Crude Steel 13.23 12.48 6 Financial Year 2018-19 saw a significant quality ramp-up in steel
Saleable Steel 12.98 12.24 6 making and rolling ahead of plan with successful development of
Sales 12.69 12.15 4 new products that was well accepted by customers.
After successful ramp up, TSK has embarked upon second phase of
expansion which will take its production capacity to 8 MnTPA.
b) Marketing and Sales Initiatives industry leader in Liquid Petroleum Gas and Medium & High Carbon
During Financial Year 2018-19, our Steel Business Unit (‘SBU’) has segments. During the year under review, the Engineering Segment
achieved a growth in sales of ~4% over previous year contributed (Pre-Engineered Building, Lifting & Excavation, Construction
primarily from sales in domestic market. & Projects and Oil & Gas) achieved annual sales of 0.450 MnT
thereby registering a growth of 49% year-on-year. Despite rising
The break-up of sales in our various segments and the break-up of protectionism, the Company maintained its presence in international
domestic sales to exports are as follows: markets and crossed 1 MnT in exports for second consecutive year.
(mn tonnes) The Company has increased its downstream businesses such as Cut &
FY 19 FY 18 Bend with Tiscon Readybuild, recording annual sales of 0.144 MnT in
Automotive & Special products 2.12 1.94 the Financial Year 2018-19 as against 0.138 MnT in previous financial
Branded Products, Retail & Solutions 3.90 3.80 year. Further, ‘Sm@rtFAB’ - India’s first branded welded wire fabric
Industrial Products & Projects 4.69 4.24 achieved an annual sales of ~1,000 tonnes.
Domestic 10.71 9.98
Services & Solutions: The Company has further strengthened its
Exports 1.06 1.15
position in Service & Solutions space by providing better consumer
Domestic + Exports 11.77 11.13
connect and experience. Since inception, 1 lakh units of Tata Pravesh
Transfers (Wires, Tubes, Agrico, Tinplate) 0.92 1.02
Total Deliveries 12.15 have been installed and over 10,000 consumers have been served
12.69
until this financial year. During the year under review, the turnover
Following are the Key Business Initiatives and achievements of from Tata Pravesh Doors and Windows have increased by ~80% as
Financial Year 2018-19: compared to previous year. Further, another premium Services
& Solutions brand – ‘Nest-In’ has doubled its business during
Automotive and Special Products: The Company achieved annual
Financial Year 2018-19 compared to previous year.
sales in Automotive sector of 2.12 MnT in Financial Year 2018-19 as
against 1.94 MnT in the previous Financial Year. Further, the Company Digital Initiatives: During the Financial Year 2018-19, the Company
registered a growth of 8.2% as against industry growth of 6.3% and has rolled out various digital initiatives across various customer
has retained its leadership in automotive flat products with a market groups. E-selling platform ‘Aashiyana’ was launched for multiple
share of 42% in the Financial Year 2018-19. Sales from Jamshedpur B2C brands, ‘COMPASS’ - a digital supply chain visibility solution
Continuous Annealing & Processing Company Private Limited was rolled out to select B2B customers and an initiative called
(‘JCAPCPL’) grew by 40% year-on-year to 289 kilo tonnes in Financial ‘DigEca’ was undertaken to capture lead management for Emerging
Year 2018-19 as against 206 kilo tonnes in previous year. Corporate Accounts (‘ECAs’) for making the process convenient for
the customers. These initiatives have contributed to the growth of
During Financial Year 2018-19, as a recognition of various initiatives
Company’s turnover for the Financial Year 2018-19.
and contributions, the Company received various accolades and
awards from its key customers and automotive leaders, including the c) Sustainable Steel Business Initiatives
‘Overall Performance Award’ for exhibiting exemplary performance
in Quality, Cost, Delivery and Development for the 4th consecutive i) New Materials Business (‘NMB’)
year and ‘Gold Business Alignment Award’ in recognition of its efforts The NMB was set up during the Financial Year 2018-19 with a vision
to cater to increased volumes. to partially insulate revenues from cyclicity of the steel business and
respond to growing demands of alternative materials from a range
Branded Products, Retail and Solutions: During the Financial
of industries.
Year 2018-19, the Company achieved an annual sales of branded
products at 3.9 MnT thereby registering growth of ~3% over NMB currently focusses on Fibre Reinforced Polymer (‘FRP’)
previous year. Brands like Tata Tiscon and Tata Astrum achieved composites with products mainly made of Glass Reinforced Polymer
higher sales of 1.43 MnT and 1.52 MnT respectively during the (‘GRP’). FRP is a composite material comprising glass/carbon/any
Financial Year 2018-19, thereby registering a year-on-year growth other fibre, embedded in a resin matrix. Its key benefits include
of 3.5% and 9% respectively. The Company’s first portal for the lightweight, corrosion resistance, high strength to weight ratio
individual home builder, ‘Aashiyana’, crossed the milestone of `100 and design freedom. NMB successfully completed India’s first ever
crore turnover in Financial Year 2018-19, since its launch in May 2018. FRP based foot over bridge project in March 2019 and sees a huge
The portal now hosts six retail brands – Tata Tiscon, Tata Pravesh, Tata potential for such bridges in the country.
Wiron, Tata Structura, Tata Agrico and Tata Shaktee and hosts over
Further, the Company has set up a Graphene Centre to explore the
5,000 service partners.
potential usage of Graphene in a variety of applications. The main
Industrial Products, Projects and Exports: The Company continues application was the development of anti-corrosion coatings on
to enrich its product portfolio with its focus towards value added cut and bend rebars. Brand GFX Ultima Superlinks launched in
and engineering segments. The annual sales of value added flat 2018 has performed well and is proposed to be upscaled in the
products in industrial segment grew by 27% year-on-year with a Financial Year 2019-20. The Company is pursuing to develop markets
total sales volume of 0.585 MnT. The Company continues to be the in industrial, retail, mobility, energy, wellness and medical verticals.
113
MANAGEMENT DISCUSSION AND ANALYSIS
The Company is one of the first entrants from the organised sector in During the Financial Year 2018-19, FAMD achieved 19% growth in its
India and large corporate groups in the composites industry working production primarily in dolomite for meeting the requirements of TSJ
on a growth strategy through current manufacturing partners and and TSK. However, sales were lower than previous year due to lower
other inorganic means. availability of rakes for despatches.
ii) Steel Recycling business The division has launched a digital initiative ’Drishti’ to enable
end to end tracking of shipments and increase of visibility in the
Steel is 100% recyclable and can be recycled to create new steel
outbound supply chain to eliminate weight loss between plant
products in a closed-material loop, making it a perfect candidate for
and end customer.
a circular economy. Recycled steel maintains the inherent properties
of the original steel. The division won the ‘National Safety Award 2016’ from his excellency
Hon’ble President of India and ‘Kalinga Safety Award 2017’ from his
Steel demand in India, is poised to grow with the scrap demand at
excellency Governor of Odisha.
present being ~30 MnTPA, with ~5 MnTPA imported from outside
India. The supply is likely to increase due to some impending e) Tubes Division
Government policies, rapid urbanisation and economic activity.
Our Tubes Strategic Business Unit is a leading manufacturer of
Steel production through the Electric Arc Furnace (‘EAF’) route, has pipes and tubes in India having its manufacturing facility situated
potential to reduce carbon emissions, resources and consumption by at Jamshedpur with an annual production capacity of ~500 kilo
60-70%, compared to traditional steel production routes. tonnes. The three main lines of businesses are conveyance tubes
(Tata Pipes), structural tubes (Tata Structura), precision tubes for auto
Sensing these opportunities, the Company started the Steel
and boiler segments.
Recycling business to meet the long-term growing demands in a
more sustainable manner.
PRODUCTION AND SALES OF TUBES DIVISION (k tonnes)
Our steel recycling business seeks to collaborate with the Government
on multiple frontiers to formalise the scrap industry. Production
Sales
524
523
India’s first State of Art Scrap Processing Centre is being set-up
509
511
487
483
462
1,270
1,241
2018 (renamed Tata Steel BSL Limited), Tubes SBU has launched
1,114
Tata Structura and Tata Pipes for its B2B and B2SME customers in
infrastructural and industrial segments.
740
585
The division has been awarded the GreenPro certification for Tata
Structura & Tata Pipes by CII Green Building Council and ‘Making of
315
315
f) Industrial By-Products and Management Division PRODUCTION AND SALES OF WIRES DIVISION (k tonnes)
Our Industrial By-products and Management Division (‘IBMD’) Production
handles variety of by-products in the entire value chain. The business Sales
385
383
operates on the principle of 3Rs (Reduce, Reuse, Recycle), thereby
366
360
ensuring contribution towards the green journey of Tata Steel.
321
320
310
309
307
302
With the objective of harnessing ‘Value from waste and by-products’,
IBMD is committed to becoming a knowledge driven business unit
leveraging digital and innovation as key pillars. The division has also
delved into downstream value enhancement of by-products which
serve as quality benchmarks in the industry.
FY15 FY16 FY17 FY18 FY19
During the year under review, the division saw substantial growth
in its brands Tata Nirman and Tata Aggreto mainly contributed by fly During the Financial Year 2018-19, the division achieved 6%
ash bricks and road making applications. growth in production and 5% growth in sales due to a consistent
year-on-year growth in infrastructure at 11% and in retail at 7%.
By-product utilisation at the Plant increased substantially by ~26% The division introduced two new products – Wiron Aayush Farming
over the previous year. and GI Knotted Fence.
The division’s Wire Plant in Tarapur has been awarded the national
award for achieving ‘manufacturing competitiveness’ by Indian
BY-PRODUCT UTILISATION AT PLANT AND SALES OF
IBM DIVISION (k tonnes) Research Institute of Manufacturing.
38
38
37
37
37
36
35
34
The division has been awarded ‘Company of the year’ at the 14th
Global Slag Conference and Exhibition 2019 in Aachen, Germany for
its work in innovative applications of Slag.
g) Wires Division
Our Global Wires India (‘GWI’) Business Unit is the largest manufacturer
of steel wires in India. The plants are located at Tarapur, Pithampur
and Jamshedpur, contributing to nearly 70% of its sales volume, with FY15 FY16 FY17 FY18 FY19
remaining 30% being catered by Wires Processing Centres. GWI caters The sales have reduced by 5% over previous year due to drop in
to the requirements of the Indian Automobile Industry, Construction production in the automobile segment, low priced imports from
Industry and the rural markets with various products. China and increase in cost of basic raw materials - steel and alloy steel.
The Division has improved plant availability by debottlenecking and
leveraging its existing resources for sustainable operations.
115
MANAGEMENT DISCUSSION AND ANALYSIS
i) Shikhar25 (Operational Improvement Programmes) The production and sales performance of TSBSL is given below:
The Shikhar25 program, a multi-divisional, multi-location, cross (mn tonnes)
functional program, completed four years in Financial Year 2018-19. FY 19
The Company has been pursuing the ‘journey for improvement’ Crude Steel 3.58
since its inception. The continuous learning and improvement Saleable Steel 3.50
journey has been one of the foundation pillars for driving benchmark Sales 3.57
performance across the value chain.
During the Financial Year 2018-19, the saleable steel production
The programme covers entire steel value chain with structured stood at 3.5 MnT and the crude steel production stood at 3.58 MnT.
collaboration from Raw Materials division to Marketing & Sales
The long-term sustainability of TSBSL requires structured and
division as an umbrella initiative. It intends to drive break through
accelerated operational excellence and integration with Tata
improvement projects with best of rigor and simplified governance,
Steel. Post the acquisition, many improvement projects have been
without compromising on safety, environment and people standards
undertaken at TSBSL. We have put in place strategies to optimise the
and in collaboration with internal/external stakeholders to achieve
use of the existing assets and reach higher level of capacity utilisation
best in class operational performance.
to produce value added grades, increase the customer base and
During the year under review, basis previous years’ learnings, the bring about development in domestic market and value creation
Shikhar25 programme was extended to tap potentials for Cross through synergy initiatives.
cutting themes across divisions and its facility at TSK. Three new
TSBSL is working towards stabilising the operations at the plant,
IMPACT Centers were established namely Tubes, JUSCO and Finance
debottlenecking existing facilities, raising its standards to the
& Accounts. All the Impact Centres focussed on new technology
benchmark demonstrated performance and realising synergies.
adaptation in collaboration with suppliers and integrating digital
Further, TSBSL plans to achieve benchmark performance across all
initiatives to explore new horizons of improvements. Key levers
areas to achieve rated capacity and generate strong cash flows.
for improvement were improvement in sale of enriched products,
increase in throughput at West Bokaro collieries, maximising captive In July 2018, TSBSL launched an accelerated performance
iron ore supply to Tata Steel BSL Limited (formerly Bhushan Steel improvement plan to achieve industry benchmark in operational
Limited), cost reduction of clean coal from Jharia and iron ore, excellence and customer focus with the agenda of deep change
reduction of solid fuel in pellet plant, reduction in graphite electrode management encompassing employee engagement and capability
consumption in LDs, HM +Scrap yield at LDs, cost reduction of Lime building. Accordingly, the IMPACT Centre (‘IC’) methodology along
Consumption & Ferro Alloys at LDs, reduction in inbound/outbound with the D0-D4 stage gate approach (based on degree of hardness)
logistics spend base, packaging cost, energy efficiency, cost was leveraged to drive this program.
optimisation for other procured goods and services amongst others.
Under the program, 13 ICs were rapidly setup and stabilised
Total improvement savings achieved in the Financial Year 2018-19 across the entire value chain laying down the culture for
is `2,801 crore. continuous improvement, ownership and drive. These ICs are
working on over 500 ideas including synergy initiatives across
2. Tata Steel BSL Limited (formerly Bhushan Steel Limited) the value chain. The benefits achieved from these initiatives in the
The Company acquired controlling stake in Bhushan Steel Limited Financial Year 2018-19 is ~`630 crore.
[renamed Tata Steel BSL Limited (‘TSBSL’)] vide National Company
Law Tribunal (‘NCLT’) Order dated May 15, 2018 under the Insolvency 3. Tata Steel Europe (‘TSE’)
and Bankruptcy Code (‘IBC’). The Financial Statements of TSBSL have Global GDP growth in 2018 was 3.2%. The eurozone economy grew
been consolidated effective May 18, 2018 and hence previous year’s by 1.8% in 2018 compared to 2.5% in 2017. Growth was negatively
figures are not comparable. impacted by a slowing Chinese economy and US protectionism.
The UK economic growth eased to 1.4% in 2018 compared to 1.7% in
The turnover and profit/loss figures of TSBSL for the Financial Year
2017 mainly due to ongoing uncertainty towards Brexit which caused
2018-19 are given below:
businesses to postpone decisions regarding future investments.
(` crore)
FY 19 As economic growth weakened, capacity utilisation in the global steel
Turnover 18,376 industry reduced causing steel prices and margins to fall. The World
EBITDA 3,033 Steel Association predicts that EU steel demand is expected to grow
Profit before tax (PBT), before exceptional (922) by only 0.5% in 2019. Margins are expected to remain under pressure
Profit before tax (PBT) (881) in 2019 as further reductions to global overcapacity is unlikely.
Profit after tax (PAT), before exceptional (922)
Profit after tax (PAT) (881) Negotiations between the EU and the UK in relation to Brexit and the
evolving political situations are being monitored by the TSE Brexit
Working Group, which includes an assessment of the threats and
opportunities that Brexit may impose on the EU steel market and
the TSE customers. TSE is committed to maintaining close dialogue and unplanned downtime. Further progress was also achieved in its
with its customers and partners to ensure that all potential Brexit ‘Strategic Asset Roadmap’ (‘STAR’) capital investment programme
scenarios are planned for, short-term disruption is minimised and to support the strategic growth of differentiated, high value
opportunities for the re-alignment of supply chains are identified. products in the automotive, lifting & excavating, energy and power
market sectors.
The European Commission granted the UK a 6-month extension to
Brexit till October 31, 2019 averting the UK to leave the EU without The World Economic Forum announced that Tata Steel IJmuiden
a deal. As part of its risk management, TSE has identified a number had been inducted into its prestigious community of ‘Lighthouses’
of mitigating actions it would implement for a ‘no-deal’ scenario. for its Advanced Analytics-programme, a distinction awarded to
Due to the ongoing Brexit uncertainty, the pound has continued to manufacturing facilities which are leaders in the technologies of the
remain weak against major currencies in the Financial Year 2018-19 Fourth Industrial Revolution. In 2018, Tata Steel IJmuiden celebrated
averaging 1.13 against the euro (2017-18: 1.14) and 1.32 versus the its centennial anniversary. The festivities were highly valued by the
US dollar (2017-18: 1.33). employees and visitors to the site.
The turnover and profit/loss figures of TSE (continuing operations) Strip Products UK – During the year under review, the liquid steel
are given below: production at Port Talbot Steel Works, Wales was at 3.2 MnT which
(` crore) was lower by 0.4 MnT from the previous year due to an outage to
FY 19 FY 18 extend the life of Blast Furnace 5. During Financial Year 2018-19 Strip
Turnover 64,777 59,985 Products UK further optimised its new automotive finishing line
EBITDA 5,414 3,713 (‘AFL’) and extensive work was undertaken on the power plant to
Profit before tax (PBT), before exceptional (1,078) (1,803) extend its generation capability. Further progress was achieved in
Profit before tax (PBT) (1,147) 12,048 its ‘Delivering Our Future’ improvement initiative programme that
Profit after tax (PAT), before exceptional (1,405) (2,164) is now incorporated more deeply across the full UK supply chain.
Profit after tax (PAT) (1,475) 11,687
In addition, the ‘Sustainable Operational Excellence’ programme
was rolled out across the hub with a significant impact on daily
The production and sales performance of TSE (continuing operations)
management activities through the mass engagement and coaching
is given below:
of points of leadership and their teams.
(mn tonnes)
FY 19 FY 18 Change (%)
Strategic Activities
Liquid Steel Production 10.31 10.69 (4)
Deliveries 9.64 9.99 (4) During the year under review,
• TSE signed definitive agreements with thyssenkrupp AG
TSE’s revenue of `64,777 crore for the Financial Year 2018-19 to combine the European Steel Business into a 50:50 joint
increased by 8% over previous year primarily owing to an increase venture, named thyssenkrupp Tata Steel BV on June 30, 2018.
in average revenue per tonne due to improved market conditions The transaction is subject to merger control clearance in several
partly offset by reduction in deliveries. jurisdictions, including the European Union.
The principal activities in Financial Year 2018-19 comprised • TSE successfully completed a major project to extend the life of
manufacture and sale of steel products throughout the world. Blast Furnace 5 at Port Talbot. The project comprised a capital
TSE’s continuing operations produced carbon steel by the basic investment of £56m and is expected to extend the life of the
oxygen steelmaking method at its integrated steelworks in the furnace by 5 to 7 years and improve its operational stability.
Netherlands at IJmuiden and in the UK at Port Talbot. During Financial
Year 2018-19 these plants produced 10.3 MnT of liquid steel. • TSE announced its intention to divest its Cogent, Kalzip, Firsteel,
Engineering Steels Service Centre (Wolverhampton) and Tata
Whilst the Group seeks to increase its differentiated/premium Steel Istanbul Metals (Colours) businesses. The disposal of the
business which is less dependent on market price movements, it Kalzip business to Donges SteelTec GmbH was completed on
still retains focus in both the UK and IJmuiden on improving its October 1, 2018. Discussions to divest the other businesses
operations, consistency, and taking measures to protect against remain ongoing.
unplanned interruptions and property damage.
Awards and Accolades:
Strip Products Mainland Europe – During the Financial Year
2018-19, the liquid steel production at IJmuiden Steel Works, • TSE won an award for its innovative construction software ‘BIM DNA
Netherlands was at 7.1 MnT which remained unchanged compared Profiler’ which was named the best new product at the BIM show.
to previous year. Record annual outputs of 1.4 MnT were achieved • TSE won an award for ‘Excellence in Education and Training’ at the
at the Direct Sheet Plant. Further, during the year under review, Steelie Awards 2018.
Strip Products Mainland Europe continued with its ‘Sustainable
Profit’ programme which targets improvements to delivery and • TSE has been named a sustainability champion by the World
yield performance, commercial mix and reduce operating costs Steel Association.
117
MANAGEMENT DISCUSSION AND ANALYSIS
4. South East Asia Operations ‘Excellence in Corporate Social Responsibility in 2018’ by the CII-ITC
On January 28, 2019, T S Global Holdings Pte. Ltd. (‘TSGH’) (an Centre for Excellence for Sustainable Development.
indirect wholly-owned subsidiary of the Company) executed
6. The Tinplate Company of India Limited
definitive agreements to divest its entire equity stake in NatSteel
Holdings Pte. Ltd. (‘NSH’) and Tata Steel (Thailand) Public Company The turnover and profit/loss figures of The Tinplate Company of India
Ltd. (‘TSTH’) As per the agreement, the divestment will be made Limited (‘TCIL’) for Financial Year 2018-19 are as follows:
to a company, to be formed, in which 70% equity shares will be (` crore)
held by an entity controlled by HBIS Group Co., Ltd. and 30% will FY 19 FY 18
be held by TSGH. Turnover 2,611 1,931
Profit before tax (PBT) 92 115
The assets and liabilities of these companies have been classified
Profit after tax (PAT) 58 73
as held for sale as on March 31, 2019 and have been presented
separately in the Consolidated Balance Sheet of Tata Steel. The TCIL is the largest indigenous producer of tin coated and tin free steel
results for the current period of these companies have been disclosed used for metal packaging. It has also been ‘value-adding’ its products
within discontinued operations and results for the previous periods by way of providing printing and lacquering facility to reach closer
have been restated accordingly. to food processors/fillers. TCIL has two Cold Rolling Mills and two
electrolytic tinning lines with an installed annual production capacity
Loss of `89 crore for the Financial Year 2018-19 (Previous Year Profit
of around 379 kilo tonnes of tinplate and tin-free steel.
of `141 crore) have been reported under ‘discontinued operations’
in the Statement of Profit and Loss of Tata Steel for the period During the year under review, TCIL’s consumption in India grew
ended March 31, 2019. by ~6% primarily driven by paints & aerosol end use segments
growing at ~8% each. Tin Free Steel (‘TFS’) for crown caps also
5. Tata Metaliks Limited increased considerably by 18%. However, the demand from oil can,
The turnover and profit/loss figures of Tata Metaliks Limited (‘TML’) one of the largest end use segments, was much lower than expected
for Financial Year 2018-19 are as follows: due to fillers choosing alternate packaging medium owing to steep
(` crore) increase in the tinplate price.
FY 19 FY 18
Turnover 2,155 1,894 During the Financial Year 2018-19, TCIL achieved deliveries of
Profit before tax (PBT) 212 200 359 kilo tonnes as against 361 kilo tonnes of previous year due to
Profit after tax (PAT) 182 159 sluggish demand. The turnover is higher over the previous year
due to increase in realisations as there has been an increase in steel
TML has its manufacturing plant at Kharagpur, West Bengal, India prices. However, PAT is lower than previous year due to increase in
which produces annually 300 kilo tonnes of pig iron and 200 kilo cost of raw materials.
tonnes of ductile iron pipes. Pig iron is marketed under the brand
name ‘Tata eFee’ (world’s first brand) and ductile iron pipe is marketed TCIL was awarded ‘Award for Excellence in Consistent TPM
under the brand name ‘Tata Ductura’. Commitment’ for 2018, by Japan Institute of Plant Maintenance.
During the Financial Year 2018-19, the sale of pig iron was at 7. Tata Steel Processing and Distribution Limited
280 kilo tonnes as against 291 kilo tonnes of previous year owing to The turnover and profit/loss figures of Tata Steel Processing and
a sluggish demand. However, the sale of ductile iron pipes increased Distribution Limited (‘TSPDL’) for the Financial Year 2018-19
to 240 kilo tonnes as against 209 kilo tonnes of previous year due to are as follows:
higher demand in the project segment. (` crore)
FY 19 FY 18
TML has started Pulverised Coal Injection (‘PCI’) and usage of pellets
Turnover 4,281 3,196
in both the Mini Blast Furnaces (‘MBFs’).
Profit before tax (PBT) 118 96
The increase in turnover is due to an increase in net realisation of Profit after tax (PAT) 76 64
pig-iron and ductile iron pipes offset by lower sale of pig iron.
TSPDL is India’s largest steel service centre organisation with
The increase in PAT is due to improvement in cost primarily due to primary operations being steel coil slitting, cut-to-length, blanking,
improvement in specific consumption of raw materials – coke, iron corrugation, plate burning and fabrication. TSPDL is the pioneer and
ore, operational efficiency and lower overheads. a leader in the organised steel processing and distribution market.
During the year under review, TML was awarded with ‘Noteworthy World-class processing facilities and comprehensive quality
Water Efficient Unit’ at the 4th Water Innovation Summit 2018 assurance systems combine to make TSPDL a benchmark in the
(Economic Growth & Human Development in Context of Water steel service industry. TSPDL has developed IT rack solutions (Wall
Security) & National Awards for Excellence in Water Management and Mounted, Floor Standing and Open) for various applications.
TSPDL currently has a processing capacity of 3.5 MnT with around C. Financial Performance
75% of utilisation in the Financial Year 2018-19 as compared to the
1. Tata Steel Limited (Standalone)
processing capacity of 3.2 MnT in the previous year.
During the year under review, the Company recorded a profit after
During the Financial Year 2018-19, TSPDL achieved 1,807 kilo tonnes tax of `10,533 crore (previous year: `4,170 crore). The increase is
of tolling volumes and 805 kilo tonnes of distribution volumes, an primarily on account of improved realisations, higher deliveries and
increase of 19% and 18% respectively over previous year which lower exceptional charges over previous year. The basic and diluted
resulted in an increase in turnover. The profits are higher primarily earnings per share for the Financial Year 2018-19 were at `90.41 per
due to higher contribution from tolling. share and `90.40 per share respectively (previous year: basic: `38.57
TSPDL won the Suraksha Puraskar (Bronze Trophy) and was awarded per share, diluted: `38.56 per share).
‘CII National Energy Management award 2018- Energy Efficient Unit’ The analysis of major items of the financial statements is given below:
8. Tata Sponge Iron Limited a) Revenue from operations
The turnover and profit/loss figures of Tata Sponge Iron Limited (` crore)
(‘TSIL’) for the Financial Year 2018-19 are as follows: FY 19 FY 18 Change (%)
(` crore) Sale of products 67,214 57,614 17
FY 19 FY 18 Sale of power and water 1,709 1,691 1
Turnover 992 817 Other operating revenue 1,688 1,214 39
Profit before tax (PBT) 188 210 Total revenue from
70,611 60,519 17
Profit after tax (PAT) 124 141 operations
TSIL is a manufacturer of sponge iron with an annual production During the year under review, sale of products was higher as
capacity of 390 kilo tonnes and generates 26 MW of power through compared to the previous year, primarily due to higher realisations
the waste heat recovery route. and increased volumes. The Ferro Alloys and Mineral Division
During the Financial Year 2018-19, sale of sponge iron was 437 kilo registered a higher revenue owing to higher production of Ferro
tonnes as against 414 kilo tonnes of previous year. The turnover has Chrome along with improved demand in the international market.
increased by 21% due to increase in net realisation from sponge iron The Wires and Tubes division registered higher revenue due to
and higher sales volume. However, the profit is lower than previous increase in realisations. Other operating revenue increased mainly
year due to higher cost of ore and coal. due to higher benefits arising out of exports.
119
MANAGEMENT DISCUSSION AND ANALYSIS
During the year under review, the expense increased primarily g) Finance costs and net finance costs
on account of salary revisions, its consequential impact on the (` crore)
retirement provisions. FY 19 FY 18 Change (%)
Finance costs 2,824 2,811 0
e) Depreciation and amortisation expense Net Finance costs 600 2,068 (71)
(` crore)
FY 19 FY 18 Change (%)
During the year under review, finance costs were almost at par with
Depreciation and
3,803 3,727 2 the previous year. Net finance charges were lower on account of
amortisation expense
higher interest income on inter-company deposits (‘ICDs’) partly
The increase in depreciation is due to regular additions in fixed assets. offset by lower income from mutual funds.
j) Investments Net debt was higher as compared to previous year. This is attributable
(` crore) to decrease in current investments along with cash and bank balances.
FY 19 FY 18 Change (%)
Investment in Gross debt was marginally higher due to issue of non-convertible
Subsidiary, JVs and 4,438 3,666 21 debentures and fresh loan drawn of term loan, partly offset by
Associates scheduled repayment and pre-payments.
Investments - Non-current 34,492 5,971 478
Investments - Current 477 14,640 (97) n) Cash Flows
Total Investments 39,407 24,277 62 (` crore)
FY 19 FY 18 Change (%)
Net Cash from/(used in)
The increase in investments was predominantly on account of 15,193 11,791 29
operating activities
higher investments in preference shares of subsidiaries mainly in Net Cash from/(used in)
TSBSL (formerly Bhushan Steel Limited), partly offset by decrease in (16,350) (12,273) (33)
investing activities
investments in mutual funds. Net Cash from/(used in)
(2,887) 4,166 (169)
financing activities
k) Inventories Net increase/(decrease) in
(` crore) (4,044) 3,684 (210)
cash and cash equivalents
FY 19 FY 18 Change (%)
Finished and Net cash flow from/(used in) operating activities
semi-finished goods 4,205 3,658 15
including stock-in-trade During the year under review, the net cash generated from operating
Work-in-progress 14 7 100 activities was `15,193 crore as compared to `11,791 crore during the
Raw materials 4,496 4,953 (9) previous year. The cash inflow from operating profit before working
Stores and spares 2,540 2,405 6 capital changes and direct taxes during the current year was `19,949
Total Inventories 11,255 11,023 2 crore as compared to inflow of `15,109 crore during the previous year
due to higher operating profit. Cash outflow from working capital
Finished and semi-finished inventory increased as compared to changes in 2018-19 is `223 crore mainly due to increase in inventories
previous year mainly due to increase in flat products inventory. by `215 crore and increase in Non-current/Current financial and other
The decrease in raw material inventories over the previous year assets by `611 crore partly offset by increase in Non-current/current
was mainly due to decrease in coal inventory. Stores and spares financial and other liabilities/provisions by `603 crore. The income
inventory had increased mainly on account of higher consumption taxes paid during the current year was `4,533 crore as compared to
and increase in prices. `2,503 crore during Financial Year 2017-18.
121
MANAGEMENT DISCUSSION AND ANALYSIS
o) Changes in key financial ratios TSE reported increase mainly on account of an increase in average
The details of changes in the key financial ratios as compared to revenue per tonne, supported by favourable forex impact
previous year are stated below: on translation.
FY 19 FY 18 Change (%) Increase in ‘Others’ primarily reflects transactions through TSPDL,
Inventory Turnover (days) 60 67 (10) TCIL and Tata Steel Global Procurement (‘TSGP’), which are,
Debtors Turnover 1 (days) 8 12 (33) eliminated on consolidation.
Current Ratio (Times) 0.73 0.91 (20)
Interest Coverage
9.57 7.08 35
b) Purchases of stock-in-trade
Ratio 2 (Times) (` crore)
Debt Equity (Times) 0.44 0.49 (10) FY 19 FY 18 Change (%)
Net Debt Equity 3 (Times) 0.42 0.15 180 Tata Steel 1,808 647 179
EBITDA Margin (%) 29.38 26.11 13 TSBSL 7 - N.A.
Net Profit Margin 4 (%) 14.92 6.89 117 TSE 4,814 4,800 0
Return on Average Others 6,110 4,327 41
15.43 7.21 114
Networth 5 (%) Eliminations & Adjustments (6,171) (4,399) (40)
Total purchases of stock-
6,568 5,375 22
1) Debtors Turnover Ratio: Improved primarily on account of in-trade
decrease in debtors by 27% owing to higher discounting.
Expense was higher mainly at Tata Steel (Standalone) due to higher
2) Interest Coverage Ratio: Improved primarily on account of higher
purchases of wire rods, imported rebars, hot rolled coils, cold rolled
operating profits.
coils and slabs owing to higher requirement.
3) Net Debt Equity Ratio: Increased primarily on account of
significant decline in cash and bank balances and other liquid c) Cost of materials consumed
investments over previous year. (` crore)
FY 19 FY 18 Change (%)
4) Net Profit Margin: Increased primarily on account of increase in Tata Steel 19,840 16,878 18
net profits attributable to higher operating profits, lower exceptional TSBSL 9,840 - N.A.
charge and higher finance income during Financial Year 2018-19. TSE 23,407 22,629 3
Others 34,758 28,569 22
5) Return on net worth: Increased primarily on account of increase
Eliminations & Adjustments (33,536) (27,314) (23)
in net profits attributable to higher operating profits during Total cost of materials
Financial Year 2018-19. 54,309 40,762 33
consumed
2. Tata Steel Limited (Consolidated) Consumption was higher mainly on account of acquisition of
Tata Steel Consolidated profit after tax (including discontinued TSBSL. Increase at Tata Steel (Standalone) was higher due to higher
operations) was `9,098 crore as against `17,763 crore in the previous consumption of coal and purchased pellet, along with higher cost
year. The decrease was mainly due to previous year’s exceptional gain of imported coal. TSE reported an increase mainly on account of
of `9,599 crore as against charge of `121 crore during current year. adverse exchange impact on translation.
Others primarily reflects activities at Tata Steel Global Procurement
a) Revenue from Operations
(‘TSGP’) which are majorly eliminated on consolidation.
(` crore)
FY 19 FY 18 Change (%)
d) Employee benefits expense
Tata Steel 70,611 60,519 17
(` crore)
TSBSL 18,376 - N.A. FY 19 FY 18 Change (%)
TSE 64,777 59,985 8 Tata Steel 5,131 4,829 6
Others 46,877 38,261 23 TSBSL 327 - N.A.
Eliminations & Adjustments (42,972) (34,655) (24) TSE 12,444 11,407 9
Total revenue from Others 857 734 17
1,57,669 1,24,110 27
operations Total employee benefits
18,759 16,970 11
expense
The consolidated revenue from operations was higher as compared
to the previous year primarily due to acquisition of TSBSL. Acquisition of TSBSL resulted in increase in employee benefit
Increase at Tata Steel Standalone was primarily on account of higher expense. Expense at Tata Steel (Standalone) increased mainly
Steel volumes and realisations and higher other operating income. on account of salary revisions and its consequential impact on
the retirement provisions. TSE reported increase due to adverse Expense was higher mainly due to acquisition of TSBSL.
exchange impact on translation and normal salary increase. Tata Steel (Standalone) reported increase mainly on account of higher
consumption of stores and spares, higher repairs and maintenance
e) Depreciation and amortisation expense expenses, royalty charges and freight and handling charges.
(` crore)
FY 19 FY 18 Change (%) TSE reported increase mainly on account of higher stores and spares
Tata Steel 3,803 3,727 2 consumed, higher level of repairs and maintenance, power cost
TSBSL 1,228 - N.A. along with exchange impact on translation.
TSE 1,936 1,727 12
Increase in Others was mainly at Tata Steel Global Holdings on
Others 375 288 30
Total depreciation and account of adverse exchange rate movement.
7,342 5,742 28
amortisation expense
g) Finance costs and net finance costs
(` crore)
Expense was higher than previous year mainly on account of FY 19 FY 18 Change (%)
acquisition of TSBSL. Increase in expense at Tata Steel (Standalone) Tata Steel 2,824 2,811 0
was in line with normal addition. Expense at TSE was higher in TSBSL 2,834 - N.A.
line with normal addition along with adverse exchange impact TSE 4,631 3,912 18
on translation. Others 7,273 2,786 161
Eliminations & Adjustments (9,902) (4,054) (144)
f) Other expenses Finance costs 7,660 5,455 40
(` crore)
FY 19 FY 18 Change (%) (` crore)
Tata Steel 23,823 21,841 9 FY 19 FY 18 Change (%)
TSBSL 4,661 - N.A. Tata Steel 600 2,068 (71)
TSE 18,826 17,793 6 TSBSL 2,727 - N.A.
Others 3,864 1,881 105
TSE 4,592 3,868 19
Eliminations & Adjustments (2,428) (2,045) (19)
Others 238 (358) 166
Total other expenses 48,746 39,470 24
Eliminations & Adjustments (1,531) (1,067) (43)
Net Finance costs 6,626 4,509 47
Other expenditure represents the following expenditure:
(` crore) Finance cost was higher due to external borrowings taken by
FY 19 FY 18 Change (%) Bamnipal Steel Limited for the acquisition of TSBSL.
Consumption of
11,160 8,440 32 Expense at TSBSL mainly relates to fund provided by Bamnipal Steel
stores and spares
Repairs to buildings 133 99 34 Limited for the acquisition which was eliminated on consolidation.
Repairs to machinery 6,672 5,708 17
Relining expenses 88 52 69 Net finance charge was higher in line with increase in finance cost.
Fuel oil consumed 451 351 28 However, expense was lower at Tata Steel (Standalone) mainly on
Purchase of power 4,865 4,090 19 account of interest income from inter-company deposits (‘ICD’)
Conversion charges 2,681 2,657 1 given to Bamnipal Steel Limited for acquisition of TSBSL, which was
Freight and handling charges 8,389 7,950 6 eliminated on consolidation.
Rent 3,455 2,379 45
Royalty 2,191 1,650 33 h) Exceptional items
Rates and taxes 1,485 1,235 20 (` crore)
Insurance charges 272 282 (4) FY 19 FY 18 Change (%)
Commission, Tata Steel (114) (3,366) N.A.
260 255 2
discounts and rebates TSBSL 41 - N.A.
Allowance for credit losses/
174 94 85 TSE (69) 13,851 N.A.
provision for advances
Excise Duty (including Others 79 (921) N.A.
0 861 (100) Eliminations & Adjustments (58) 35 N.A.
recovered on sales)
Other expenses 8,134 4,368 86 Total exceptional items (121) 9,599 N.A.
Less : Expenditure (other than
interest) transferred to capital (1,664) (1,001) (66)
& other accounts
Total Other expenses 48,746 39,470 24
123
MANAGEMENT DISCUSSION AND ANALYSIS
Exceptional items during the current financial year, • Impairment charges ₹903 crore in respect of property, plant and
primarily represents: equipment (including Capital Work-in-Progress) and intangible
assets relating to Global Mineral entities.
• Provision for demands and claims amounting to `329 crore
relating to certain statutory demands and claims on environment i) Property, plant & equipment (PPE) including intangibles
and mining matters at Tata Steel Limited (Standalone). (` crore)
FY 19 FY 18 Change (%)
• Provision of `172 crore in respect of advances with public bodies Tata Steel 77,018 77,402 (0)
paid under protest by TSBSL.
TSBSL 29,673 - N.A.
• Provision for Employee Separation Scheme (‘ESS’) under Sunehere TSE 21,880 20,562 6
Bhavishya Ki Yojana (‘SBKY’) scheme amounting to `35 crore at NSH (0) 811 (100)
Tata Steel Limited (Standalone). TSTH 0 692 (100)
Others 10,669 9,512 12
• Impairment charges of `10 crore in respect of property, plant Eliminations & Adjustments (154) (359) 57
and equipment (including capital work-in-progress and capital Total property, plant &
advances) and intangible asset at TSBSL. equipment (PPE) including 1,39,086 1,08,620 28
Partly offset by, intangibles
• Profit on sale of non-current investments amounting to `180 crore, Increase in PPE and intangibles mainly due to acquisition of TSBSL
primarily in TRL Krosaki Refractories Limited (an associate of the was partly offset by decrease at NatSteel Holdings and Tata Steel
Company) and certain other subsidiaries and joint ventures. Thailand as these companies have been classified as ‘held for sale’ as
• Restructuring and write back of provisions amounting to `245 on March 31, 2019.
crore which primarily includes write-back of liabilities no longer
j) Inventories
required at TSBSL and arbitration settlement at Jamshedpur
(` crore)
Utilities & Services Company Ltd., partly offset by charge at FY 19 FY 18 Change (%)
Tata Steel Europe. Finished and
The exceptional items in Financial Year 2017-18 primarily include: semi-finished goods 11,152 9,854 13
including stock-in-trade
• Gains arising out of modification in benefit structure for members Work-in-progress 4,592 5,145 (11)
of the new pension scheme (‘NBSPS’) versus their benefits under Raw materials 11,425 9,551 20
Tata Steel Europe’s British Steel Pension Scheme (‘BSPS’), offset by Stores and spares 4,487 3,780 19
settlement charges for those members who did not join the NBSPS Total inventories 31,656 28,331 12
and one-off costs at Tata Steel Europe amounting to `13,851 crore.
(` crore)
Partly offset by,
FY 19 FY 18 Change (%)
• Provision of `3,214 crore in respect of certain statutory demands Tata Steel 11,255 11,023 2
and claims relating to environment and mining matters, net of TSBSL 4,582 - N.A.
liability written back towards District Mineral Fund (DMF) at Tata TSE 13,714 13,762 (0)
Steel Limited (Standalone). NSH 0 1,053 (100)
TSTH 0 725 (100)
• Provision for advances paid for repurchase of equity shares in Tata Others 2,256 1,826 24
Teleservices Ltd. from NTT DoCoMo Inc. amounting to `27 crore at Eliminations & Adjustments (151) (58) (160)
Tata Steel Limited (Standalone). Total inventories 31,656 28,331 12
• Provision for Employee Separation Scheme (‘ESS’) under Increase was primarily on account of acquisition of TSBSL. Tata Steel
Sunehere Bhavishya Ki Yojana (‘SBKY’) scheme `108 crore mainly Standalone reported increase on account of higher finished and
at Tata Steel Limited (Standalone) and at Jamshedpur Utilities & semi-finished goods, stores and spares, partly offset by decrease at
Services Company Ltd. NatSteel Holdings and Tata Steel Thailand as these companies have
been classified as held for sale as on March 31, 2019.
k) Trade receivables changes and direct taxes during the current year was `27,840 crore
(` crore) as against `20,187 crore during the previous year reflecting higher
FY 19 FY 18 Change (%) operating profits. Cash inflow from working capital changes during
Tata Steel 1,363 1,876 (27) the current period was `2,591 crore primarily due to increase in
TSBSL 697 - N.A. Non-current/Current financial and other liabilities/provisions by
TSE 5,607 6,451 (13) `3,774 crore, partly offset by increase in inventories by `1,069 crore
NSH 0 516 (100) and Non-current/Current financial and other assets `115 crore.
TSTH (0) 254 (100) The payments of income taxes during the year under review were
Others 15,531 14,805 5
`5,094 crore as compared to `2,888 crore during the previous year.
Eliminations & Adjustments (11,387) (11,486) 1
Net trade receivables 11,811 12,416 (5) Net cash flow from/(used in) investing activities
Decrease at NatSteel Holdings and Tata Steel Thailand was During the year under review, the net cash outflow from investing
primarily on account of their classification as ‘held for sale’ as on activities was `29,902 crore as against an outflow of `12,026
March 31, 2019. Decrease at Tata Steel (Standalone) was primarily due crore during the previous year. The outflow in the Financial Year
to better realisations. These decreases were partly offset by increase 2018-19 broadly represents capex `9,091 crore, acquisition of
on account of acquisition of TSBSL. subsidiaries/undertakings `35,282 crore, mainly related to amount
paid for acquisition of TSBSL, partly offset by sale (net of purchase) of
l) Gross debt and net debt current investments amounting to `13,093 crore.
(` crore)
FY 19 FY 18 Change (%) Net cash flow from/(used in) financing activities
Gross debt 1,00,816 92,147 9
During the year under review, net cash outflow from financing
Less: Cash and Bank
balances (incl. 3,412 8,023 (57) activities amounted to `673 crore as against inflow of `6,640 crore
Non-current balances) during the previous year. The net outflow primarily represents
Less: Current investments 2,525 14,909 (83) interest paid `7,152 crore and payment of dividend including taxes
Net debt 94,879 69,215 37 `1,424 crore, partly offset by proceeds from borrowings (net of
repayment) `8,518 crore.
Net debt was higher by `25,664 crore over previous year.
n) Changes in key financial ratios
Gross Debt at `1,00,816 crore was higher by `8,669 crore as compared The details of changes in the key financial ratios as compared to
to the previous year. Increase in Gross Debt was mainly on account of previous year are stated below:
proceeds from borrowings (net of repayment) by `8,340 crore along FY 19 FY 18 Change (%)
with exchange impact on translation being `345 crore. Inventory Turnover (days) 72 80 (10)
The increase in borrowings was mainly at TSBSL and Tata Steel Debtors Turnover (days) 28 35 (20)
Standalone, partly offset by decrease at Tata Steel Europe and Current Ratio (Times) 1.39 1.46 (5)
Singapore based entities. Interest Coverage
4.38 4.13 6
Ratio (Times)
The increase in Net Debt was in line with increase in gross debt along Debt Equity (Times) 1.51 1.82 (17)
with decrease in current investments along with cash and bank Net Debt Equity (Times) 1.43 1.37 4
balances mainly at Tata Steel Standalone. EBITDA Margin (%) 18.88 17.22 10
Net Profit Margin 1 (%) 5.77 14.31 (60)
m) Cash flows Return on
13.67 35.09 (61)
(` crore) Average Networth1 (%)
FY 19 FY 18 Change (%)
Net Cash from/(used in) 1
Decreased primarily on account of decrease in net profits
25,336 8,024 216
operating activities attributable to higher exceptional gains arising out of modification
Net Cash from/(used in) in benefit structure of Pension Scheme during the previous year.
(29,902) (12,026) (149)
investing activities
Net Cash from/(used in) D. Statutory Compliance
(673) 6,640 (110)
financing activities
Net increase/(decrease) in The Chief Executive Officer and Managing Director makes a
(5,239) 2,638 (299) declaration at each Board Meeting regarding compliance with
cash and cash equivalents
provisions of various statutes after obtaining confirmation from
Net cash flow from/(used in) operating activities respective units of the Company. The Company Secretary & Chief
During the year under review, the net cash from operating activities Legal Officer (Corporate & Compliance) ensures compliance with
was `25,336 crore as compared to `8,023 crore during the previous Company Law, SEBI, and other laws applicable to the Company.
year. The cash inflow from operating profit before working capital
125
ANNUAL REPORT ON CSR ACTIVITIES
ANNEXURE 3
Annual Report on Corporate Social Responsibility Activities
[Pursuant to Section 135 of the Companies Act, 2013 and
the Companies (Corporate Social Responsibility Policy) Rules, 2014]
I. Overview of the Corporate Social Responsibility promotion and growth of the rural economy, rural welfare,
(‘CSR’) Policy socio-economic development and upliftment of the people
in rural areas.
Our CSR initiatives are guided by our CSR Policy (‘Policy’) adopted
by the Board of Directors on September 17, 2014. The Policy is
Tribal Cultural Society (‘TCS’), a registered society under
available on the Company’s website www.tatasteel.com. Our CSR Societies Registration Act, 1860. The principal objective of the
activities focus on initiatives in the areas of education, health, society is to promote and undertake cultural activities, cultural
water, livelihood, rural and urban infrastructure and are aligned education and training of various tribes.
to the key focus areas of the Tata Group. We also undertake
Tata Steel Skill Development Society (‘TSSDS’), a registered
community-centric interventions in the areas of sports, disaster
society under Societies Registration Act, 1860. The principal aim
relief, environment and ethnicity.
and object of the society is to provide facilities for technical and
other skill enhancement trainings within the nation.
II. Composition of CSR and Sustainability
Committee of the Board Tata Steel Family Initiatives Foundation (‘TSFIF’), a registered trust
At the helm of our CSR governance structure is the Corporate under Indian Trusts Act, 1882. The principal objective of the trust
Social Responsibility and Sustainability Committee of the is to undertake projects/programmes on reproductive health,
Board that comprises Mr. Deepak Kapoor (Chairperson), prevention of drug or alcohol addiction and empowerment of
Mr. O. P. Bhatt, Mr. Koushik Chatterjee and Mr. T. V. Narendran. women through literacy and income generation.
Tata Steel Zoological Society (‘TSZS’), a registered society
III. CSR Advisory Council under Societies Registration Act, 1860. The principal objective
We have a CSR Advisory Council comprising eminent of the society is to provide natural habitats to various animals
personalities from academia and the development sector. suitable for their conservation and propagation. It also acts as
The members of the Advisory Council provide macro policy-level a facilitator to spread the message of nature conservation by
inputs to the apex CSR and Sustainability Committee and guide building awareness and conducting educational programmes.
the Company’s approach towards CSR.
V. Financial Details
IV. CSR Delivery Arms Particulars (` crore)
In terms of the Companies Act, 2013, companies are allowed Average net profit of the Company for last 4,120.15
to carry out their CSR activities through registered trusts three financial years
and/or societies. We carry out our community centric Prescribed CSR expenditure 82.40
interventions through a number of CSR delivery arms including (2% of the average net profits)
the following: Details of CSR spent during the financial year:
Tata Steel Foundation (‘TSF’), a Section 8 Company incorporated (a) Total amount to be spent for 82.40
the financial year
under the Companies Act, 2013. The main objective of the
formation of TSF is to consolidate, strengthen and broaden the (b) Amount spent 314.94
CSR programme deployment as well as create a distinct brand (c) Amount unspent, if any Nil
identity for it. The manner in which the amount is spent on CSR activities
Tata Steel Rural Development Society (‘TSRDS’), a registered undertaken during the year is given as an annexure to this
society under Societies Registration Act, 1860. The principal aim report. Details of CSR projects undertaken during the year along
and objective of the society is to undertake, promote, sponsor, with its impact is discussed in the Social & Relationship capital
assist or aid directly any activity/project/programme for the section of this Integrated Report.
sd/- sd/-
DEEPAK KAPOOR T. V.NARENDRAN
Chairman of CSR and Chief Executive Officer &
Sustainability Committee Managing Director
DIN: 00162957 DIN: 03083605
Mumbai
April 25, 2019
127
ANNUAL REPORT ON CSR ACTIVITIES | CORPORATE GOVERNANCE REPORT
(` crore)
(1) (2) (3) (4) (5) (6) (7) (8)
Cumulative
Amount spent
amount spent on Amount spent:
on the projects
CSR project or activity Sector in which the Location of project Amount the projects or Direct or through
Sl. No or programmes
identified project is covered (District & State) outlay programmes upto implementing
during current
current reporting agency
reporting period
period
Environmental sustainability, Jharkhand - East
protection of flora & fauna, agro Singhbhum, Ramgarh Direct,
6 forestry, animal welfare, resource Environment Odisha - Jajpur, 2.50 2.63 18.12 TSRDS,
conservation, maintaining quality Kendujhar TSZS
of soil, air, water West Bengal – Burdwan
Total 2.50 2.63 18.12
Jharakhand -
Protection and restoration of East Singhbhum,
national heritage, promotion of West Singhbhum,
7 Ethnicity 6.66 8.06 27.01 TCS
art, culture, handicrafts, setting up Ramgarh, Ranchi
public libraries etc Odisha - Kendujhar,
Jajpur
Total 6.66 8.06 27.01
Jharkhand - East
Singhbhum, West Direct,
Promotion of Rural, Nationally
Singhbhum, Dhanbad,
8 recognised, Paralympic and Sports 17.63 10.19 35.62 TSRDS,
Ramgarh, Ranchi
Olympic sports especially training TSF
Odisha - Ganjam, Jajpur,
Kendujhar, Sundargarh
Total 17.63 10.19 35.62
Jharkhand - East
Singhbhum, Direct,
Rural development
Rural & Urban West Singhbhum,
9 projects (infrastructure and 17.22 19.72 81.63 TSRDS,
Infrastructure Dhanbad, Ramgarh
other developments) TSF
Odisha - Ganjam,
Jajpur, Kendujhar
Total 17.22 19.72 81.63
Total Direct expenses of projects & programmes (A) 264.67 304.16 1,067.15
Overhead Expenses (restricted to the 5% of total CSR expenditure) (B) 12.22 10.78 48.94
Total (A) + (B) 276.89 314.94 1,116.09
Note: Cumulative amount spent on the projects or programmes upto current reporting period has been calculated from Financial Year 2014-15 onwards.
ANNEXURE 4
Corporate Governance Report
Company’s Corporate Governance Philosophy All our Promoters (including Promoter group), Directors, Employees
Corporate governance is the creation and enhancement of long-term of the Company and its material subsidiaries identified as Designated
sustainable value for our stakeholders through ethically driven Persons, and their Immediate Relatives and other Connected Persons
business process. At Tata Steel, it is imperative that our Company’s such as auditors, consultants, bankers amongst others, who could
affairs are managed in a fair and transparent manner. have access to the unpublished price sensitive information of the
Company, are governed under this Insider Trading Code.
We ensure that we evolve and follow not just the stated corporate
governance guidelines, but also global best practices. We consider it Mr. Parvatheesam K, Company Secretary & Chief Legal Officer
our inherent responsibility to protect the rights of our shareholders (Corporate & Compliance) of the Company is the ‘Compliance Officer’
and disclose timely, adequate and accurate information regarding in terms of this Code.
our financials and performance, as well as the leadership and
governance of the Company. Corporate Governance Guidelines
The Board of Directors (‘the Board’) has adopted the Tata Group
In accordance with our Vision, Tata Steel Group (‘the Group’) aspires
Guidelines on Board Effectiveness to help fulfil its corporate
to be the global steel industry benchmark for ‘value creation’ and
governance responsibility towards its stakeholders. These guidelines
‘corporate citizenship’. The Group expects to realise its Vision by
provide for the composition and role of the Board and ensure that
taking such actions as may be necessary to achieve its goals of value
the Board will have the necessary authority and processes in place to
creation, safety, environment and people.
review and evaluate the Company’s operations.
The Company is in compliance with the requirements stipulated under
Regulation 17 to 27 read with Schedule V and Regulation 46(2)(b)(i) Board of Directors
of Securities and Exchange Board of India (Listing Obligations and The Board is at the core of our corporate governance practice and
Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’), oversees and ensures that the Management serves and protects the
as applicable, with regard to corporate governance. long-term interest of all our stakeholders. We believe that an active,
well-informed and independent Board is necessary to ensure the
Code of Conduct highest standards of corporate governance.
The Company has a strong legacy of fair, transparent and ethical
governance practices. Size and Composition of the Board
The Company has adopted the Tata Code of Conduct (‘TCoC’) for Our policy is to have an appropriate mix of Executive Directors
Executive Directors (‘EDs’), Senior Management Personnel and (‘EDs’), Non-Executive, Non-Independent Directors (‘NEDs’) and
other Executives and Employees, which is available on the website Independent Directors (‘IDs’) to maintain the Board’s independence
www.tatasteel.com The Company has received confirmations and separate its functions of governance and management.
from the EDs as well as Senior Management Personnel regarding As on March 31, 2019, the Board comprised of ten members, two
compliance of the Code during the year under review. The Company of whom are EDs, three NEDs and five IDs, including a Woman
has also adopted the Code of Conduct for Non-Executive Directors Director. The Board periodically evaluates the need for change in its
(‘NEDs’) of the Company which includes Code of Conduct for composition and size. Detailed profile of our Directors is available
Independent Directors (‘IDs’) which suitably incorporates the on our website www.tatasteel.com None of our Directors serve as
duties of Independent Directors as laid down in the Companies Director in more than eight listed companies, as IDs in more than
Act, 2013. The same is available on the website www.tatasteel.com. seven listed companies and none of the EDs serve as IDs on any listed
The Company has received confirmations from the NEDs and IDs company. Further, none of our IDs serve as Non-Independent Director
regarding compliance of the Code for the year under review. of any company on the board of which any of our Non-Independent
Director is an ID.
Tata Code of Conduct for Prevention of Insider Independent Directors are non-executive directors as defined under
Trading & Code of Corporate Disclosure Practices Regulation 16(1)(b) of the Listing Regulations read with Section
In accordance with the Securities and Exchange Board of India 149(6) of the Act along with rules framed thereunder. In terms of
(Prohibition of Insider Trading) Regulations, 2015, as amended from Regulation 25(8) of Listing Regulations, they have confirmed that they
time to time, the Board of Directors of the Company has adopted the are not aware of any circumstance or situation which exists or may
revised Tata Code of Conduct for Prevention of Insider Trading and be reasonably anticipated that could impair or impact their ability
the Code of Corporate Disclosure Practices (‘Insider Trading Code’). to discharge their duties. Based on the declarations received from
129
CORPORATE GOVERNANCE REPORT
the Independent Directors, the Board of Directors has confirmed that The Company has issued formal letters of appointment to the IDs.
they meet the criteria of independence as mentioned under Section As required under Regulation 46 of the Listing Regulations, as
149 of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing amended, the terms and conditions of appointment of IDs including
Regulations and that they are independent of the management. their role, responsibility and duties are available on our website
www.tatasteel.com
Table A: Composition of the Board and Directorships held as on March 31, 2019
Indian Public Board Committees(2) Directorship in other listed entity
Name of the Director
Companies(1) Chairperson Member (Category of Directorship)
Non-Executive, Non-Independent Directors
Mr. Natarajan Chandrasekaran 5 - - a. Tata Consultancy Services Limited
Chairman (Non-Executive, Non-Independent)
DIN: 00121863 b. Tata Motors Limited
(Non-Executive, Non-Independent)
c. Tata Global Beverages Limited
(Non-Executive, Non-Independent)
d. The Tata Power Company Limited
(Non-Executive, Non-Independent)
e. The Indian Hotels Company Limited
(Non-Executive, Non-Independent)
Mr. Saurabh Agrawal 6 1 2 a. The Tata Power Company Limited
DIN: 02144558 (Non-Executive, Non-Independent)
b. Tata AIG General Insurance Co. Ltd
(Non-Executive, Non-Independent)
Mr. Vijay Kumar Sharma(3) 2 - - a. ACC Limited
DIN: 02449088 (Non-Executive, Non-Independent)
b. Mahindra and Mahindra Limited
(Nominee Director)
Independent Directors
Ms. Mallika Srinivasan 7 - - a. Tata Global Beverages Limited
DIN: 00037022 (Non-Executive, Independent)
b. The United Nilgiri Tea Estates Company Limited
(Non-Executive, Non-Independent)
Mr. O. P. Bhatt 3 1 3 a. Tata Consultancy Services Limited
DIN: 00548091 (Non-Executive, Independent)
b. Hindustan Unilever Limited
(Non-Executive, Independent)
c. Tata Motors Limited
(Non-Executive, Independent)
Dr. Peter Blauwhoff - - - -
DIN: 07728872
Mr. Aman Mehta 5 1 5 a. Wockhardt Limited
DIN: 00009364 (Non-Executive, Independent)
b. Godrej Consumer Products Limited
(Non-Executive, Independent)
c. Max Financial Services Limited
(Non-Executive, Independent)
d. Tata Consultancy Services Limited
(Non-Executive, Independent)
e. Vedanta Limited
(Non-Executive, Independent)
Mr. Deepak Kapoor 2 1 2 a. HCL Technologies Limited
DIN: 00162957 (Non-Executive, Independent)
Table B: Director qualifications, skills, expertise, competencies and attributes desirable in Company’s business and sector in
which it functions
Skills and Attributes Description
Alignment with Company
Exhibit high levels of integrity and be appreciative of the core values of the Company and the Tata Group
culture and value system
Experience in leading and managing large corporations and have an understanding of the business environment,
Experience in managing complex business processes, strategic planning, risk management, etc. Also, possess experience in driving growth
large corporations through acquisitions and other integration plans with the ability to evaluate opportunities that are in line with the
Company’s strategy.
Experience and knowledge of the functioning, operations, growth drivers, business environment and changing
Understanding of
trends in the metals & mining, manufacturing and engineering industries as well as experience in overseeing large
industry and operations
supply chain operations
Understanding of finance Experience in financial management of large corporations with understanding of capital allocation & funding and
and related aspects financial reporting processes
Understanding of emerging trends in technology and innovation that may have an impact on the business and
Knowledge of
have the ability to guide necessary interventions that can be utilised in making the business more competitive
technology and innovation
and sustainable
Understanding of the legal ecosystem within which the Company operates and possess knowledge on
Knowledge of
matters of regulatory compliance, governance, internal controls. Experience in policy advocacy at national and
Governance and Law
international level
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CORPORATE GOVERNANCE REPORT
Familiarisation Programme for Directors (including be taken towards mitigating risks arising from global sustainability
Independent Directors) trends and climate change.
All new Directors (including Independent Directors) inducted As stated in the Board’s Report, the details of orientation given to
to the Board are given a formal orientation. The familiarisation our existing Independent Directors are available on our website
programme for our Directors is customised to suit their individual www.tatasteel.com
interests and area of expertise. The Directors are encouraged to visit
the plant and raw material locations of the Company and interact Board Evaluation
with members of Senior Management as part of the induction
The NRC has formulated a Policy for evaluation of the Board, its
programme. The Senior Management make presentations giving
Committees and Directors and the same has been approved and
an overview of the Company’s strategy, operations, products,
adopted by the Board. The details of Board Evaluation forms part of
markets, group structure and subsidiaries, Board constitution and
the Board’s Report.
guidelines, matters reserved for the Board and the major risks and
risk management strategy. This enables the Directors to get a deep Remuneration Policy for Board and Senior Management
understanding of the Company, its people, values and culture and
The Board has approved the Remuneration Policy for Directors,
facilitates their active participation in overseeing the performance
Key Managerial Personnel (‘KMP’) and all other employees of the
of the Management. Further, during the year, a Sustainability
Company. The same is available on our website www.tatasteel.com
Workshop by the Cambridge Institute for Sustainability Leadership
Details of remuneration for Directors in Financial Year 2018-19 are
(CISL) was organised for the Directors and the Senior Management
provided in Table C below.
of the Company. The objective of the Workshop was to provide an
understanding on the imperatives for the Company and actions to
Table C: Shares held and remuneration paid to Directors for the year ended March 31, 2019
(` lakh)
Fixed Salary
Sitting Total
Name Perquisite/ Total Fixed Commission 6
Basic Fees Compensation
Allowance Salary
Non-Executive, Non-Independent Directors
Mr. N. Chandrasekaran 1 – – – – 4.80 4.80
Mr. D. K. Mehrotra 2
– – – 38.00 2.40 40.40
Mr. Vijay Kumar Sharma 2
– – – – 6.40 6.40
Mr. Saurabh Agrawal 3
– – – 36.00 1.20 37.20
Independent Directors
Ms. Mallika Srinivasan – – – 125.00 4.00 129.00
Mr. O. P. Bhatt – – – 181.00 9.60 190.60
Dr. Peter Blauwhoff 4
– – – 111.00 6.80 117.80
Mr. Aman Mehta – – – 90.00 4.80 94.80
Mr. Deepak Kapoor – – – 106.00 8.00 114.00
Executive Directors
Mr. T. V. Narendran 5 132.00 190.63 322.63 800.00 – 1,122.63
Mr. Koushik Chatterjee 5
123.00 234.14 357.14 725.00 – 1,082.14
5. Mr. T. V. Narendran holds 2,032 Fully Paid Ordinary Shares and 139 Partly NED – Non-Executive Director; ID – Independent Director;
Paid Ordinary Shares of the Company and Mr. Koushik Chatterjee holds ED – Executive Director
1,531 Fully Paid Ordinary Shares and 105 Partly Paid Ordinary Shares of the
Company as on March 31, 2019.
1. Mr. D. K. Mehrotra ceased to be a Member of the Board
effective May 16, 2018.
6. Commission relates to the Financial Year ended March 31, 2019, which
was approved by the Board on April 25, 2019, to be paid during the 2. Mr. Vijay Kumar Sharma was inducted on the Board as Additional
Financial Year 2019-20. (Non-Executive, Non-Independent) Director effective August 24, 2018.
7. None of our Directors hold stock options or convertible securities of the Video/tele-conferencing facilities are also used to facilitate Directors
Company as on March 31, 2019. None of the Executive Directors are eligible travelling/residing abroad or at other locations to participate
for payment of any severance fees and the contracts with Executive Directors in the meetings.
may be terminated by either party giving the other party six months’ notice
or the Company paying six months’ salary in lieu thereof. All the Directors as on the date of the AGM were present at the AGM
of the Company held on Friday, July 20, 2018.
Board Meetings
Meeting of the Independent Directors
Scheduling and selection of agenda items for Board Meetings
Pursuant to Schedule IV of the Companies Act, 2013, the Independent
Dates for Board Meetings in the ensuing financial year are decided Directors met on April 3, 2018 and March 29, 2019 without the
in advance and communicated to the members of the Board. presence of Non-Independent Directors and Members of the
The information as required under Regulation 17(7) read with Management. The Independent Directors, inter alia, evaluated the
Schedule II Part A of the Listing Regulations, as amended, is made performance of the Non-Independent Directors and the Board of
available to the Board. The Board reviews minutes of the meetings Directors as a whole, evaluated the performance of the Chairman of
of Board of Directors of the unlisted subsidiaries of the Company. the Board taking into account views of Executive and Non-Executive
The agenda and explanatory notes are sent to the Board in advance. Directors and discussed aspects relating to the quality, quantity and
The Board periodically reviews compliance reports of all laws timeliness of the flow of information between the Company, the
applicable to the Company. The Board meets at least once a quarter to Management and the Board.
review the quarterly financial results and other items on the agenda.
Additional meetings are held, when necessary. Committees of the Board Committees
Board usually meet the day before the Board meeting, or whenever
the need arises for transacting business. The recommendations Audit Committee
of the Committees are placed before the Board for necessary The primary objective of the Audit Committee is to monitor and
approval and/or noting. provide an effective supervision of the Management’s financial
reporting process, to ensure accurate and timely disclosures, with
7 Board meetings were held during the year ended March 31, 2019
the highest levels of transparency, integrity and quality of financial
on April 3, 2018, May 16, 2018, June 27, 2018, August 13, 2018,
reporting. The Committee oversees the work carried out in the
November 13, 2018, February 8, 2019 and March 29, 2019. The gap
financial reporting process by the Management, the internal auditor,
between any two Board meetings during this period did not exceed
the statutory auditor and the cost auditor and notes the processes
one hundred and twenty days.
and safeguards employed by each of them. The Committee further
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CORPORATE GOVERNANCE REPORT
reviews the process and controls including compliance with laws, Company. The remuneration policy and the criteria for making
Tata Code of Conduct and Tata Code of Conduct for Prevention payments to Non-Executive Directors is available on our website
of Insider Trading and Code for Corporate Disclosure Practices, www.tatasteel.com The Committee has the overall responsibility
Whistle Blower Policy and related cases thereto, functioning of the of approving and evaluating the compensation plans, policies
Prevention of Sexual Harassment at Workplace Policy and guidelines and programmes for Executive Directors and the Senior
and internal controls. Management. The Committee reviews and recommends to the
Board, the base salary, incentives/commission, other benefits,
The Board of Directors of the Company adopted the Audit Committee
compensation or arrangements for the Executive Directors for its
Charter on March 31, 2015 which was revised on March 2, 2017 and
approval. The Committee coordinates and oversees the annual
February 8, 2019.
self-evaluation of the performance of the Board, Committees and of
The Company Secretary and Chief Legal Officer (Corporate & individual Directors.
Compliance) acts as the Secretary to the Committee. The internal
5 meetings of the Committee were held during the year ended
auditor reports functionally to the Audit Committee. The Executive
March 31, 2019 on April 3, 2018, May 16, 2018, August 13, 2018,
Directors and Senior Management of the Company also attend the
March 12, 2019 and March 29, 2019.
meetings as invitees whenever required to address concerns raised
by the Committee Members. Table F: The composition of the Committee and the
5 meetings of the Committee were held during the year ended attendance details of the Members for the year ended
March 31, 2019, on May 16, 2018, August 13, 2018, November 13, 2018, March 31, 2019 are given below:
February 7, 2019 and March 28, 2019. No. of Meetings Attendance
Name of Members Category
Attended (%)
Table E: The composition of the Committee and the Ms. Mallika Srinivasan
attendance details of the Members for the year ended ID 5 100
(Chairperson)
March 31, 2019 are given below: Mr. O. P. Bhatt ID 5 100
Mr. N. Chandrasekaran NED 5 100
No. of Meetings Attendance
Name of Members Category
Attended (%) ID – Independent Director; NED – Non-Executive Director
Mr. O. P. Bhatt (Chairperson) ID 5 100 Ms. Mallika Srinivasan, Chairperson of the NRC was present at the
Mr. Aman Mehta ID 3 60 AGM of the Company held on Friday, July 20, 2018.
Dr. Peter Blauwhoff ID 5 100
Mr. Saurabh Agrawal NED 4 80 Corporate Social Responsibility and Sustainability
Committee
ID – Independent Director; NED – Non-Executive Director
The purpose of our Corporate Social Responsibility and Sustainability
Mr. O. P. Bhatt, Chairperson of the Audit Committee was present at (‘CSR&S’) Committee is to formulate and recommend to the Board,
the AGM of the Company held on Friday, July 20, 2018. a Corporate Social Responsibility Policy, which shall indicate the
initiatives to be undertaken by the Company, recommend the amount
Nomination and Remuneration Committee
of expenditure the Company should incur on Corporate Social
The purpose of the Nomination and Remuneration Committee (‘NRC’) Responsibility (‘CSR’) activities and to monitor from time to time the
is to oversee the Company’s nomination process including succession CSR activities and Policy of the Company. The Committee provides
planning for the senior management and the Board and specifically guidance in formulation of CSR strategy and its implementation and
to assist the Board in identifying, screening and reviewing individuals also reviews practices and principles to foster sustainable growth
qualified to serve as Executive Directors, Non-Executive Directors and of the Company by creating values consistent with long-term
Independent Directors consistent with the criteria as stated by the preservation and enhancement of financial, manufacturing, natural,
Board in its Policy on Appointment and Removal of Directors. social, intellectual and human capital.
The Board has adopted the NRC Charter for the functioning of the The Board has approved a Charter is for the functioning of the
Committee on May 20, 2015 which was revised on March 29, 2019 Committee, on March 31, 2015 which is revised from time to time.
basis the amendments in Listing Regulations.
The CSR policy is available on our website at www.tatasteel.com
The NRC also discharges the Board’s responsibilities relating to
compensation of the Company’s Executive Directors and Senior 3 meetings of the Committee were held during the year
Management. The Committee has formulated Remuneration ended March 31, 2019 on May 15, 2018, July 19, 2018 and
Policy for Directors, KMPs and all other employees of the November 12, 2018.
Table G: The composition of the Committee and the Table H: The composition of the Committee and the
attendance details of the Members for the year ended attendance details of the Members for the year ended
March 31, 2019 are given below: March 31, 2019 are given below:
No. of Meetings Attendance
Name of Members Category No. of Meetings Attendance
Attended (%) Name of Members Category
Attended (%)
Mr. Deepak Kapoor
ID 3 100
(Chairperson) Mr. O. P. Bhatt (Chairperson) ID 3 100
Mr. O. P. Bhatt ID 3 100 Mr. Aman Mehta ID 2 67
Mr. D. K. Mehrotra 1 NED 1 100 Mr. Deepak Kapoor ID 3 100
Mr. T. V. Narendran ED 2 67 Mr. D. K. Mehrotra 1 NED 1 100
Mr. Koushik Chatterjee ED 3 100 Mr. Saurabh Agrawal NED 3 100
ID – Independent Director; NED – Non-Executive Director; Mr. T. V. Narendran ED 3 100
Mr. Koushik Chatterjee ED 3 100
ED – Executive Director
Dr. Hans Fischer MoM 2 67
1. Mr. D. K. Mehrotra ceased to be a Member of the Board effective Mr. Anand Sen MoM 3 100
May 16, 2018 and consequently ceased to be Member of the CSR&S Mr. Sandip Biswas MoM 3 100
Committee effective same date. Mr. N. K. Misra MoM 2 67
Mr. Deepak Kapoor, Chairperson of the Committee was present at the ID – Independent Director; NED – Non-Executive Director;
AGM of the Company held on Friday, July 20, 2018. ED – Executive Director; MoM – Member of Management.
Risk Management Committee 1. Mr. D. K. Mehrotra ceased to be a Member of the Board effective
May 16, 2018 and consequently ceased to be a Member of the RMC
Risk Management is crucial to achieve the Group’s objective in
effective same date.
strengthening its financial position, safeguarding interests of
stakeholders, enhancing its ability to continue as a going concern Stakeholders’ Relationship Committee
and maintain a consistent sustainable growth.
The Stakeholders’ Relationship Committee (‘SRC’) considers and
The Company has constituted a Risk Management Committee (‘RMC’) resolves the grievances of our shareholders, debenture holders and
for framing, implementing and monitoring the risk management other security holders, including complaints relating to non-receipt
policy of the Company. The Committee assists the Board in of annual report, transfer and transmission of securities, non-receipt
fulfilling its oversight responsibility with respect to Enterprise Risk of dividends/interests, issue of new/duplicate certificates, general
Management (‘ERM’). meetings and such other grievances as may be raised by the security
holders from time to time.
The terms of reference of the RMC are:
The Committee also reviews:
a) Overseeing key risks, including strategic, financial, operational,
IT (including cyber security) and compliance risks. a)
Measures taken for effective exercise of voting rights
by Shareholders;
b) Assisting the Board in framing, implementing and monitoring
the risk management plan for the Company and reviewing and b)
Service standards adopted by the Company in respect of
guiding the Risk Policy. services rendered by our Registrars & Transfer Agent;
c)
Developing risk management policy and risk management c)
Measures and initiatives taken for reducing quantum
system/framework for the Company. of unclaimed dividends and ensuring timely receipt of
dividend/annual report/notices and other information
The Board has adopted a Charter for RMC Committee on May 20, 2015.
by Shareholders.
3 meetings of the Committee were held during the year
T he Board has adopted a Charter for the functioning of the SRC on
ended March 31, 2019 on May 15, 2018, August 13, 2018 and
April 11, 2014 which was revised on February 8, 2019.
November 13, 2018.
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CORPORATE GOVERNANCE REPORT
1 meeting of the Committee was held during the year ended During the year, the business of the Committee was transacted
March 31, 2019 on February 7, 2019. primarily by passing resolutions through circulation and the same
were then placed before the Board for noting.
Table I: The composition of the Committee and the attendance
details of the Members for the year ended March 31, 2019 are 1 meeting of the Committee was held during the year ended
given below: March 31, 2019 on September 20, 2018.
During the year under review, based on the recommendation of the Investor grievance and share transfer system
Nomination and Remuneration Committee (‘NRC’), the Board: We have a Board-level Stakeholders’ Relationship Committee to
a)
Appointed Mr. Vijay Kumar Sharma (DIN: 02449088) as an examine and redress investors’ complaints. The status on complaints
Additional (Non-Executive, Non-Independent) Director effective and share transfers are reported to the entire Board.
August 24, 2018. During the Financial Year 2018-19, the Securities and Exchange Board
b)
Proposes to re-appoint (i) Ms. Mallika Srinivasan of India (‘SEBI’) and Ministry of Corporate Affairs (‘MCA’) has mandated
(DIN: 00037022) as Independent Director of the Company, not that existing members of the Company who hold securities in
liable to retire by rotation, for a second term on the Board with physical form and intend to transfer their securities after April 1, 2019,
effect from August 14, 2019 up to May 20, 2022; (ii) Mr. O. P. Bhatt can do so only in dematerialised form. Therefore, Members holding
(DIN: 00548091) as Independent Director of the Company, not shares in physical form were requested to consider converting their
liable to retire by rotation, for a second term on the Board with shareholding to dematerialised form. During the year, the Company
effect from August 14, 2019 up to June 9, 2023. has sent necessary intimations to its shareholders regarding the
restriction on transfer of securities in the physical form.
c) Re-appointed Mr. T. V. Narendran as the Chief Executive Officer
and Managing Director of the Company with effect from Share transactions in electronic form can be effected in a simpler and
September 19, 2018 to September 18, 2023, upon the terms and faster manner. After a confirmation of a sale/purchase transaction
conditions as mentioned in the Notice convening the AGM. from the broker, shareholders should approach the Depository
Participant (‘DP’) with a request to debit or credit the account for
The Board recommends the above appointment/re-appointments the transaction. The DP will immediately arrange to complete the
for approval of the Shareholders at the ensuing AGM. transaction by updating the account. There is no need for a separate
The detailed profiles of the above Directors including particulars communication to the Company to register these share transfers.
of their experience, skills or attributes are provided in the Notice Shareholders should communicate with TSR Darashaw Limited, the
convening the AGM. Company’s Registrars and Transfer Agents (‘RTA’) quoting their Folio
Number or Depository Participant ID (‘DP ID’) and Client ID number,
Communication to the Shareholders
for any queries to their securities.
We send quarterly financial results to our Shareholders electronically.
Key financial data is published in The Indian Express, Financial Details of non-compliance
Express, Nav Shakti, Free Press Journal and Loksatta. The financial The Company has complied with the requirements of the Stock
results along with the earnings releases are also posted on the Exchanges, SEBI and other statutory authorities on all matters
Company’s website www.tatasteel.com relating to capital markets during the last three years. There has been
Earnings calls are held with analysts and investors and their no instance of non-compliance with any legal requirements during
transcripts are published on the website. Presentations made to the year under review.
analysts and others are also made available on the Company’s None of the Company’s listed securities are suspended from trading.
website www.tatasteel.com
Certificates from Practising Company Secretaries
All price sensitive information and matters that are material to
shareholders are disclosed to the respective Stock Exchanges As required by Regulation 34(3) and Schedule V Part E of the Listing
where the securities of the Company are listed. All submissions to Regulations, the certificate given by Parikh & Associates, Practicing
the Exchanges are made through their respective electronic online Company Secretaries, is annexed to this report.
filing systems. The same are also available on the Company’s website As required by Clause 10 (i) of Part C under Schedule V of the Listing
www.tatasteel.com Regulations, the Company has received a certificate from Parikh &
The Company’s website is a comprehensive reference on it’s Associates, Practicing Company Secretaries certifying that none
leadership, management, vision, mission, policies, corporate of our Directors have been debarred or disqualified from being
governance, sustainability, investor relations, products and processes appointed or continuing as Directors of the Company by Securities
and updates and news. The section on ‘Investors’ serves to inform the and Exchange Board of India or Ministry of Corporate Affairs or such
Shareholders, by giving complete financial details, stock exchange other statutory authority.
compliances including shareholding patterns and updated credit
CEO and CFO certification
ratings amongst others, corporate benefits, information relating
to Stock Exchanges, details of Registrars & Transfer Agent and As required by Regulation 17(8) read with Schedule II Part B of
frequently asked questions. Investors can also submit their queries the Listing Regulations, the Chief Executive Officer & Managing
by submitting ‘Shareholder Query Form’ and get feedback online. Director and Executive Director & Chief Financial Officer have given
The section on ‘Media’ includes all major press reports and releases, appropriate certifications to the Board of Directors.
awards and campaigns by the Company, amongst others.
137
CORPORATE GOVERNANCE REPORT
No Special Resolution was passed by the Company last year through Postal Ballot. None of the businesses proposed to be transacted at the
ensuing AGM require passing a Special Resolution through Postal Ballot.
Dematerialisation of shares and liquidity prices over the long term tend to track underlying raw material
The Company’s Ordinary Shares are tradable compulsorily in prices thus providing a natural hedge to the business. Further, in
electronic form. We have established connectivity with both the India the Company has captive iron ore and coal mines which meet a
depositories, i.e., NSDL and CDSL. The International Securities significant part of the requirement of its Indian business and help it
Identification Number (‘ISIN’) allotted to the Fully Paid and Partly Paid manage raw material price volatility.
Ordinary Shares under the Depository System are INE081A01012 In addition, to address the short-term volatility, the Company
and IN9081A01010 respectively. specifically hedges certain commodities in the derivatives market
The Company has 1,18,29,61,937 Ordinary Shares (including Fully as well as tries to buy part of its strategic material requirements on
Paid and Partly Paid Ordinary Shares) representing 98.24% of the annual fixed prices.
Company’s share capital which is dematerialised as on March 31, Further, to manage the raw material sourcing, the Company has
2019. Further, during Fiscal 2019, the Securities and Exchange Board a dedicated strategic procurement team with understanding of
of India (‘SEBI’) and the Ministry of Corporate Affairs (‘MCA’) has international commodity markets including raw material required
mandated that existing members of the Company who hold for steel industry operations. This experienced team works closely
securities in physical form and intend to transfer their securities after with key raw material producers across the globe and is tasked with
April 1, 2019, can do so only in dematerialised form. Hence, to enable developing a reliable and lowest cost supply chain. The team carries
us to serve our Shareholders better, we request our Shareholders out a risk assessment of the supply chain and works consciously
whose shares are in physical mode to dematerialise shares and to towards mitigating the risk of any disruption in supply chain. It
update their bank accounts and email ids with their respective DPs. ensures there is adequate diversification in terms of vendors,
Further, outstanding GDR Shares 1,34,73,958 (March 31, 2018: geographies etc. and also carries out risk assessment of vendors with
1,27,40,651) of face value of `10 per share represent the shares regards reliability of supply, financial strength etc. The team also
underlying GDRs which were issued during 1994 and 2010. Each GDR has a value in use (VIU) optimization framework in place and closely
represents one underlying Ordinary Share. monitors and analyses price movements in grades of raw materials to
arrive at the most effective source and cost of supply.
Commodity price risk or foreign exchange risk and hedging
Exposure of the Company to commodity and commodity risk faced
activities
by the Company throughout the year:
The Company inherently faces risks arising out of raw material price
volatility which impacts its profitability and cash flows. However, steel 1. Total exposure of the listed entity to commodities: `12,038 crore.
Apart from the strategic procurement of coal and other commodities, Tata Steel has been a miner for the last hundred years and it mines 100%
of its iron ore requirements and about one fourth of its coking coal requirement from its captive mines. Thus, its exposure is naturally hedged
to the above extent.
139
CORPORATE GOVERNANCE REPORT
Designated e-mail address for investor services Compliance with discretionary requirements
To serve the investors better and as required under Regulation All mandatory requirements of the Listing Regulations have been
46(2)(j) of the Listing Regulations, the designated e-mail address complied with by the Company. The status of compliance with the
for investor complaints is [email protected] The e-mail address discretionary requirements, as stated under Part E of Schedule II to
for grievance redressal is continuously monitored by the Company’s the Listing Regulations, is as under:
Compliance Officer.
The Board: As on date, the positions of the Chairman and the Chief
Investor Awareness Executive Officer are separate. Mr. N. Chandrasekaran is the Non-
As part of good governance we have provided subscription facilities Executive Chairman of the Board and Mr. T. V. Narendran is the Chief
to our investors for IR alerts regarding press release, results, webcasts, Executive Officer & Managing Director of the Company.
analyst meets and presentations amongst others. We also provide Shareholder Rights: The half-yearly financial performance of the
our investors facility to write queries regarding their rights and Company is sent to all the Members possessing e-mail IDs. The results
shareholdings and have provided details of persons to be contacted are also available on the Company’s website www.tatasteel.com
for this purpose. We encourage investors to visit our website for
reading the documents and for availing the above facilities at Modified opinion(s) in Audit Report: The Auditors have expressed
www.tatasteel.com an unmodified opinion in their report on the financial statements of
the Company.
Legal proceedings
Reporting of Internal Auditor: The Internal Auditor reports to the
There are certain pending cases related to disputes over title to shares Audit Committee.
in which the Company had been made a party. However, these cases
are not material in nature.
Table P: Distribution of Shareholding of Ordinary Shares
Fully Paid Ordinary Shares
Total No. of Shareholders % to total holders Total No. of Shares % to total capital
Share Holding as on March 31 as on March 31 as on March 31 as on March 31
2019 2018 2019 2018 2019 2018 2019 2018
1 23,884 21,327 3.01 2.76 23,884 21,327 0.00 0.00
2-10 1,20,513 1,13,210 15.18 14.64 8,09,676 7,61,432 0.07 0.07
11-50 2,37,534 2,29,602 29.93 29.70 69,86,169 66,82,927 0.62 0.59
51-100 1,24,173 1,20,595 15.64 15.60 96,55,582 92,35,996 0.86 0.82
101-200 1,23,759 1,25,266 15.59 16.20 1,79,62,365 1,80,02,217 1.60 1.60
201-500 96,515 96,320 12.16 12.46 2,98,88,109 2,95,63,645 2.65 2.63
501-1,000 34,385 34,067 4.33 4.40 2,43,91,805 2,40,00,787 2.17 2.13
1,001-5,000 28,091 27,738 3.54 3.59 5,57,76,758 5,47,92,310 4.95 4.86
5,001-10,000 2,775 2,782 0.35 0.36 1,92,47,829 1,92,88,108 1.71 1.71
10,001-1,00,000 1,841 1,832 0.23 0.24 4,49,56,780 4,38,39,362 3.99 3.89
1,00,001 and above 323 371 0.04 0.05 91,67,90,723 92,02,96,704 81.38 81.70
Total 7,93,793 7,73,110 100.00 100.00 1,12,64,89,680 1,12,64,84,815 100.00 100.00
Transfer of Unclaimed Dividend and Shares to Investor Amount of Unclaimed Dividend Number of Shares
Financial Year
Education and Protection Fund (‘IEPF’) Transferred (`) Transferred
Pursuant to the provisions of the Companies Act, 2013 read with 2010-11 7,56,12,546.00 3,86,473
Investor Education Protection Fund Authority (Accounting, Audit, The Company has sent individual communication to the concerned
Transfer and Refund) Rules, 2016, as amended, the dividends, shareholders at their registered address, whose dividend remained
unclaimed for a period of seven years from the date of transfer to the unclaimed and whose shares were liable to be transferred to the IEPF
Unpaid Dividend Account of the Company are liable to be transferred by September 7, 2018. The communication was also published in
to the IEPF. Accordingly, unclaimed dividends of Shareholders for national English and local Marathi newspapers.
the Financial Year 2011-12 lying in the unclaimed dividend account of
the Company as on September 17, 2019 will be transferred to IEPF on Any person whose unclaimed dividend and shares pertaining
the due date i.e. September 18, 2019. Further, the shares (excluding thereto, matured deposits, matured debentures, application money
the disputed cases having specific orders of the Court, Tribunal or any due for refund, or interest thereon, sale proceeds of fractional shares,
Statutory Authority restraining such transfer) pertaining to which redemption proceeds of preference shares, amongst others has been
dividend remains unclaimed for a consecutive period of seven years transferred to the IEPF Fund can claim their due amount from the
from the date of transfer of the dividend to the unpaid dividend IEPF Authority by making an electronic application in e-form IEPF-5.
account is also mandatorily required to be transferred to the IEPF Upon submitting a duly completed form, Shareholders are required
Authority established by the Central Government. Accordingly, the to take print of the same and send physical copy duly signed along
Company has transferred unclaimed dividend and eligible Shares to with requisite documents as specified in the form to the attention of
IEPF Demat Account within statutory timelines. the Nodal Officer, at the Registered Office of the Company. The e-form
can be downloaded from our website www.tatasteel.com under
The details of unclaimed dividends and shares transferred to IEPF ‘unclaimed dividend’ tab in ‘investor’ section and simultaneously
during Financial Year 2018-19 are as follows: from the website of Ministry of Corporate Affairs at www.iepf.gov.in
The Shareholders can file only one consolidated claim in a financial
year as per the IEPF Rules.
Table R: Details of date of declaration & due date for transfer to IEPF
Financial Year Dividend Per Share Date of Declaration Due date for Transfer to IEPF
2011-12 12 August 14, 2012 September 18, 2019
2012-13 8 August 14, 2013 September 16, 2020
2013-14 10 August 14, 2014 September 16, 2021
2014-15 8 August 12, 2015 September 16, 2022
2015-16 8 August 12, 2016 September 17, 2023
2016-17 10 August 8, 2017 September 9, 2024
2017-18 10 July 20, 2018 August 22, 2025
Shareholders are requested to get in touch with the RTA for encashing the unclaimed dividend/interest/principal amount, if any, standing to
the credit of their account.
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CORPORATE GOVERNANCE REPORT
The Securities and Exchange Board of India (‘SEBI’) vide its Circular No. BSE Limited (‘BSE’) INE081A01012 500470
Phiroze Jeejeebhoy Towers, (Fully Paid Shares) (Fully Paid Shares)
CIR/MRD/DP/10/2013 dated March 21, 2013 (‘Circular’) to all listed Dalal Street,
companies requires them to update bank details of their shareholders Mumbai - 400 001, IN9081A01010 890144
holding shares in demat mode and/or physical form, to enable Maharashtra, India (Partly Paid Shares) (Partly Paid Shares)
usage of the electronic mode of remittance i.e. National Automated National Stock Exchange of INE081A01012 TATASTEEL
Clearing House (‘NACH’) for distributing dividends and other cash India Limited (‘NSE’) (Fully Paid Shares) (Fully Paid Shares)
benefits to the shareholders. Exchange Plaza, 5th Floor,
Plot No. C/1, G Block,
The Circular further states that in cases where either the bank details Bandra-Kurla Complex, IN9081A01010 TATASTEELPP
Mumbai - 400 051, (Partly Paid Shares) (Partly Paid Shares)
such as Magnetic Ink Character Recognition (‘MICR’) and Indian
Financial System Code (‘IFSC’), amongst others, that are required Maharashtra, India
for making electronic payment are not available or the electronic
Table T: International Listings of securities issued by the
payment instructions have failed or have been rejected by the bank,
Company are as under:
companies or their Registrars and Transfer Agents may use physical
payment instruments for making cash payments to the investors. Global Depository Receipts (‘GDRs’):
Companies shall mandatorily print the bank account details of the GDRs 1994 2009
investors on such payment instruments.
ISIN US87656Y1091 US87656Y4061
Regulation 12 of the Listing Regulations, allows the Company to pay Listed on Luxembourg Stock Exchange London Stock Exchange
dividend by cheque or ‘payable at par’ warrants where payment by
Table U (i): Perpetual Hybrid Securities in the form of Non-
electronic mode is not possible. Shareholders to note that payment
Convertible Debentures are listed on the Wholesale Debt
of dividend and other cash benefits through electronic mode has
Market segments of the Stock Exchanges as under:
many advantages like prompt credit, elimination of fraudulent
encashment/delay in transit amongst others. They are requested to Rate (%) 11.80 11.50
opt for any of the above mentioned electronic modes of payment of ISIN INE081A08165 INE081A08173
dividend and other cash benefits and update their bank details: Principal Amount (` in crore) 1,500 775
Date of Maturity Perpetual Perpetual
Listed on NSE & BSE NSE
Table U (ii): Unsecured Redeemable Non-Convertible Debentures (‘NCDs’) are listed on the Wholesale Debt Market segment of
the Stock Exchanges as under:
(` in crore)
Maturity
Coupon Rate (%) ISIN Principal Amount Credit Ratings
Amount Date
10.40 INE081A08124 650.90 650.90 May 15, 2019 AA by CARE & India Ratings
11.00 INE081A08132 1,500.00 1,500.00 May 19, 2019 AA by India Ratings
AA by CARE & AA
9.15 INE081A08207 500.00 500.00 January 24, 2021
(Stable) by Brickwork
AA by CARE & AA
2.00 INE081A08181 1,500.00 1,500.00 April 23, 2022
(Positive) by Brickwork
AA by CARE & AA
8.15 INE081A08215 1,000.00 1,000.00 October 1, 2026
(Positive) by Brickwork
166.67 December 22, 2028
10.25 INE081A08140 500.00 166.67 December 22, 2029
166.66 December 22, 2030
AA by CARE
833.34 January 6, 2029
10.25 INE081A08157 2,500.00 833.33 January 6, 2030
833.33 January 6, 2031
1,078.75 February 28, 2031
1,078.25 March 1, 2032
9.8359% INE081A08223 4,315 AA by CARE & India Ratings
1,078.25 March 1, 2033
1,078.25 March 1, 2034
Notes:
(a) 9.15% NCDs (ISIN: INE081A08199) aggregating to `500 crore were redeemed on the due date, January 24, 2019.
(b) Further, during the year, Moody’s Investors Services upgraded long-term Corporate Family Rating of the Company by one notch from Ba3 to Ba2 while S&P
has revised its ratings outlook on the Company from ‘Stable’ to ‘Positive’ and affirmed the long-term credit rating of ‘BB-’.
143
CORPORATE GOVERNANCE REPORT
May-18
June-18
July-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-18
May-18
June-18
July-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Tata Steel on NSE Nifty (RHS) Tata Steel on BSE Sensex (RHS)
The Company’s shares are regularly traded on BSE Limited and Green Initiative
National Stock Exchange of India Limited, as is seen from the volume As a responsible corporate citizen, the Company supports the
of shares indicated in the Table containing Market Information. ‘Green Initiative’ undertaken by the Ministry of Corporate Affairs,
Government of India, enabling electronic delivery of documents
Secretarial Audit
including the Annual Report, quarterly and half-yearly results,
The Company’s Board of Directors appointed Parikh and Associates, amongst others, to Shareholders at their e-mail address previously
Practising Company Secretaries Firm, to conduct secretarial audit registered with the DPs and RTAs.
of its records and documents for the Financial Year 2018-19.
The secretarial audit report confirms that the Company has complied Shareholders who have not registered their e-mail addresses so
with all applicable provisions of the Companies Act, 2013, Secretarial far are requested to do the same. Those holding shares in demat
Standards, Depositories Act 2018, SEBI (Listing Obligations and form can register their e-mail address with their concerned DPs.
Disclosure Requirements) Regulations, 2015, SEBI (Prohibition of Shareholders who hold shares in physical form are requested to
Insider Trading) Regulations, 2015, each as amended and all other register their e-mail addresses with the RTA, by sending a letter, duly
regulations and guidelines of SEBI as applicable to the Company. signed by the first/sole holder quoting details of Folio No.
The Secretarial Audit Report forms part of the Board’s Report.
145
CORPORATE GOVERNANCE REPORT
To,
The Members
Tata Steel Limited
This certificate is issued pursuant to clause 10(i) of the Part C of Schedule V of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 as amended vide circular dated May 9, 2018 of the Securities and Exchange Board of India.
We have examined the compliance of provisions of the aforesaid clause 10(i) of the Part C of Schedule V of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and to the best of our information and according to the explanations given to us by the Company, and the
declarations made by the Directors, we certify that none of the directors of Tata Steel Limited (‘the Company’) CIN L27100MH1907PLC000260
having its registered office at Bombay House, 24-Homi Mody Street, Fort, Mumbai - 400 001 have been debarred or disqualified as on
March 31, 2019 from being appointed or continuing as directors of the Company by SEBI/Ministry of Corporate Affairs or any other
statutory authority.
sd/-
P. N. PARIKH
Mumbai, April 25, 2019 FCS No.: 327 CP No.: 1228
To,
The Members
Tata Steel Limited
We have examined the compliance of the conditions of Corporate Governance by Tata Steel Limited (‘the Company’) for the year ended on
March 31, 2019, as stipulated under Regulations 17 to 27, clauses (b) to (i) of sub-regulation (2) of Regulation 46 and para C, D & E of Schedule V
of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI Listing Regulations’).
The compliance of the conditions of Corporate Governance is the responsibility of the management. Our examination was limited to the review
of procedures and implementation thereof, as adopted by the Company for ensuring compliance with conditions of Corporate Governance.
It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, and the representations made by the Directors
and the management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the SEBI Listing
Regulations for the year ended on March 31, 2019.
We further state that such compliance is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness
with which the management has conducted the affairs of the Company.
sd/-
P. N. PARIKH
Mumbai, April 25, 2019 FCS No.: 327 CP No.: 1228
147
PARTICULARS OF REMUNERATION
ANNEXURE 5
Particulars of Remuneration
Part A: Information pursuant to Section 197(12) of the Companies Act, 2013
[Read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014]
Ratio of the remuneration of each Director/KMP to the median remuneration of all the employees of the Company for the Financial Year:
Median remuneration of all the employees of the Company for the Financial Year 2018-19 `9,98,769
The percentage increase in the median remuneration of employees in the Financial Year 5.60%
The number of permanent employees on the rolls of Company as on March 31, 2019 32,984
Remuneration for Financial Year (` lakh) % increase in Ratio of remuneration to median
Name of Director
2018-19 2017-18 remuneration remuneration of all employees(6)
Non-Executive Directors
Mr. N. Chandrasekaran (1) - - - -
Mr. D. K. Mehrotra (2) 40.40 85.30 * *
Mr. V. K. Sharma (2) 37.20 - * *
Mr. Saurabh Agrawal (3) - - - -
Independent Directors
Ms. Mallika Srinivasan 129.00 119.40 8.04 12.92
Mr. O. P. Bhatt 190.60 180.00 5.89 19.08
Dr. Peter Blauwhoff 117.80 79.40 48.36 11.79
Mr. Aman Mehta 94.80 84.40 12.32 9.49
Mr. Deepak Kapoor 114.00 75.60 50.79 11.41
Executive Directors/KMP
Mr. T. V. Narendran (4) 1,122.63 942.94 19.06 112.40
Mr. Koushik Chatterjee (4) 1,082.14 913.80 18.42 108.35
Mr. Parvatheesam K (5) 169.92 124.91 ^ *
^ Since the remuneration of Mr. Parvatheesam K is only for part of the previous year, increase in remuneration is not stated.
*Since the remuneration of these Directors/KMP is only for part of the year, the ratio of their remuneration to median remuneration is not comparable and hence
increase in remuneration is not stated.
Notes:
(1) As a policy, Mr. N. Chandrasekaran, Chairman, has abstained from receiving commission from the Company and hence not stated.
(2) Mr. D. K. Mehrotra stepped down as Member of the Board effective May 16, 2018 and Mr. V. K. Sharma was appointed as an Additional (Non-Executive)
Director effective August 24, 2018. The commission of Mr. Mehrotra and Mr. Sharma is paid to Life Insurance Corporation of India.
(3) In line with the internal guidelines of the Company no payment is made towards commission to the Non-Executive Directors of the Company, who are in full
time employment with any other Tata Company and hence not stated.
(4) Mr. T. V. Narendran and Mr. Koushik Chatterjee do not receive any remuneration or commission from any of the subsidiary companies in which they are
Members of the Board.
(5) Mr. Parvatheesam K was on leave between August 28, 2017 and July 11, 2018. Accordingly, his remuneration for the previous year includes salary drawn by
him as Company Secretary and Compliance Officer for the period April 1, 2017 through August 27, 2017 and salary received by him up to March 31, 2018
towards his earned leave. His remuneration for the current year includes salary drawn by him for the period July 12, 2018 through March 31, 2019.
(6) The ratio of remuneration to median remuneration is based on remuneration paid during the period April 1, 2018 to March 31, 2019.
During the year, the average percentage increase in salary of the Company’s employees, excluding the Key Managerial Personnel (‘KMP’) was
6.26%. The total remuneration of the KMPs for the Financial Year 2018-19 was `2,374.69 lakh as against `1,981.65 lakh during the previous
year. The percentage increase in remuneration during the Financial Year 2018-19 to Mr. T. V. Narendran, Chief Executive Officer & Managing
Director was 19.06% and to Mr. Koushik Chatterjee, Executive Director & Chief Financial Officer was 18.42%. During the year, there has been no
exceptional increase in remuneration to the KMPs. Remuneration is as per the remuneration policy of the Company.
sd/-
N. CHANDRASEKARAN
Mumbai Chairman
April 25, 2019 DIN: 00121863
employment
Chief Executive Officer & 9,72,63,186 B.E, PGDM 30 01-07-1988 53 -
1 T. V. Narendran
Managing Director
Executive Director & 9,57,13,917 B.Com. (Hons), FCA 23 13-11-1995 50 Tata Sons Ltd.
2 Koushik Chatterjee
Chief Financial Officer
B.Tech (Hons),
3 Anand Sen President (TQM & Steel Business) 6,15,99,396 37 27-07-1981 59 -
Met. Engg., PGDBM
Vice President M. Sc., Diploma in
4 Suresh Dutt Tripathi 4,74,80,420 36 18-10-2012 58 SRF Ltd
(Human Resource Management) Social Welfare
B.Com.(Hons), First India Asset
5 Sandip Biswas Group Executive Vice President (Finance) 4,18,39,396 26 01-04-2005 51
ACA, ACS Management Co. (P) Ltd.
6 Ranganath Raghupathy Rao Vice President (Finance India & SE Asia) 3,34,40,751 B.Sc, A.C.A 35 16-05-2013 59 Cairn India Ltd.
Vice President
7 Sanjiv Paul 3,23,24,009 B. Sc. (Engg) 32 01-07-1986 56 -
(Safety, Health & Sustainability)
8 Dibyendu Bose Vice President (Supply Chain) 2,94,56,437 B. Tech., PGDM 30 01-07-1988 57 Tisco Collieries
STATUTORY REPORTS | 89-194
B. Names of other employees who are in receipt of aggregate remuneration not less than Rupees One crore and two lakh during the Financial Year 2018-19:
Date of
Sl. Remuneration Experience Age
Name Designation Qualification commencement of Last employment
No. (`) (Years) (Years)
employment
1 A. D. Kothari General Manager (Projects TSK) 1,50,85,017 B. Tech. 27 01-07-1991 50 -
2 A. K. Bhatnagar Chief (Natural Resources Division) 1,20,85,187 B. Tech. 26 01-07-1992 49 -
B. Sc. (Hons),
3 Ajay Tiwari Chief (HRM PC & Corporate Functions) 1,43,79,846 19 01-08-2014 48 Hindustan Lever Ltd.
PGD (PM&IR)
4 Ajit Kar Chief (Electrical Maintenance Steel Making) 1,05,93,388 B. Tech. 26 13-07-1992 50 -
5 Amit Kumar Chatterjee Chief (Electrical Maintenance TSK) 1,53,73,586 B.E 31 27-07-1987 56 -
FINANCIAL STATEMENTS | 195-418
Free Markets
6 Amitabh Panda Group Head (Shipping & Logistics) 1,23,65,150 B. E., PGDBM 29 01-10-2004 51
Services Pvt. Ltd.
7 Amitava Baksi Chief (Procurement Officer) 1,63,98,715 B. Sc. (Engg) 32 30-06-1986 55 -
8 Amrendra Ranjan Chief (Electrical Maintenance) 1,39,74,417 B. Tech, PGDBM 38 01-07-1980 59 -
9 Anup Sahay* Chief (Corporate Strategy & Planning) 74,51,530 BA (Hons), PGDBM 32 01-07-1986 57 S B Billimoria & Company
10 Anurag Agnihotri Chief (IT Projects) 1,02,23,092 B.E 32 30-06-1986 53 -
11 Anurag Pandey Chief (Marketing & Sales, Wire Division) 1,04,36,003 B.E, XLRI (Mgmt) 25 01-07-1993 47 -
12 Anurag Saxena Chief (Electrical T & D) 1,12,82,959 B.E, MBA 31 17-12-1999 52 National Fertilizers Ltd.
13 Arun Kumar Singh Chief (Projects BOP TSK) 1,05,74,584 B.E, PGDBM 34 02-07-1984 57 -
14 Arun Misra Vice President (Raw Material) 2,56,81,218 B.Tech 30 01-07-1988 53 -
15 Ashok Kumar* Chief (Technology Officer, Process) 1,30,39,594 B.Tech 34 01-07-1984 57 -
16 Atrayee Sarkar Chief (Group HR) 1,21,82,437 B.A, PGDBM 24 01-06-1998 48 Hindustan Lever Ltd.
149
150
Date of
Sl. Remuneration Experience Age
Name Designation Qualification commencement of Last employment
No. (`) (Years) (Years)
employment
17 Avneesh Gupta Vice President (Shared Services) 2,26,41,869 B.Tech,PGDBM 32 01-07-1986 55 -
18 Baidyanath Saha Chief (Engineering Structural) 1,23,33,390 B. E. 11 01-12-2012 55 Tata Power Company Ltd.
19 Baran Sengupta Chief (Project Engineering) 1,13,96,102 B. Tech.,M.E., ICWA 34 18-11-2013 58 Ausenco Engineers Ltd.
20 Brajendra Khandelwal Chief (Special Project) 1,05,19,345 B.E., MBA 36 08-08-2014 58 Essar Steel India Ltd.
21 Ch. Ramesh Babu Chief (Design & Engineering-Process) 1,52,49,283 B.E 34 24-12-2012 54 AEGIS Ltd
22 Chacko Joseph Chief (Financial Controller) 1,17,81,409 C.S, B.Com, ICWA, C.A 36 01-07-1982 59 -
23 Chaitanya Bhanu General Manager (Operations, TSK) 1,34,32,591 M. Tech., B.Tech 26 15-07-1992 48 -
24 D.B. Sundara Ramam Principal Executive Officer 1,92,81,957 B. Sc. (Engg) 28 28-07-1990 49 -
25 Debashis Das Chief (Manufacturing, Long Product) 1,51,09,473 B.Tech 36 02-08-1982 59 -
Vice President
26 Debashish Bhattacharjee 1,70,60,055 B. E., M.Tech, Ph.D 25 01-04-1996 53 University Of Cambridge
(Technology & New Materials Business)
Aditya Birla Magt.
27 Devraj Sinh* Chief (Corporate Legal - Finance & M&A) 30,25,066 B.A., LLB, LL.M 35 01-09-2008 58
Corp. Pvt. Ltd.
28 Dibyendu Dutta Group Head (M&A and Treasury) 1,67,88,681 B.Com, F.C.A, ICWA 25 16-04-2009 52 Indian Hotels Co. Ltd.
PGDM
64 Satish Kumar Tiwary Chief (Mechanical Maintenance TSK) 1,29,55,954 B.E 29 01-07-1989 53 -
Diploma
65 Shailesh Verma Chief (Resident Executive, Jharkhand) 1,09,54,237 27 01-07-1991 52 -
Engineering, B.E
66 Shankar K. Marar Chief (Group Investment Management) 1,12,43,225 B. E., PGDBM 21 01-04-2005 49 Jindal Steel Ltd.
67 Sharat Chandra Kumar Chief (Projects TSJ) 1,07,31,537 B.Sc (Engg) 33 01-07-1985 56 -
68 Sudhansu Pathak Vice President (Steel Manufacturing) 2,82,11,894 B.E, PGDBM 34 02-07-1984 57 -
69 Sunil Bhaskaran* Vice President (Corporate Services) 2,62,15,114 B.Tech, PGDM 34 01-07-1987 54 Tata International
70 Sushanta Ganguli Chief (Sales Planning & Administration) 1,08,12,293 B.Sc, M.Sc, MBA 18 05-09-2000 55 -
71 T.V.Srinivas Shenoy Chief (New Material Business) 1,09,74,517 B.E, MBA 26 01-07-1992 49 -
72 Ujjal Chakraborti Executive-in-Charge (Tubes) 1,42,45,605 B. E. 28 02-07-1990 50 -
73 Uttam Singh Vice President (Iron Making) 2,33,10,303 B.Tech 26 13-07-1992 50 -
74 V. Ravichandran COMS (Industrial Products,Projects&Export 1,19,51,535 Diploma Engineering 20 22-06-1998 57 -
75 V.K. Shah Chief (Hot Strip Mill) 1,07,56,608 B. E., PGDM 28 02-07-1990 51 -
FINANCIAL STATEMENTS | 195-418
76 Ved Prakash Srivastava Chief (Infra & Technology Excellence) 1,46,14,052 B.Tech, PGDM 38 01-08-1980 59 -
77 Vijay Kumar Nirala Chief (Mechanical Maintenance Iron Making) 1,08,55,408 B.E., Diploma (Mgmt) 24 01-01-1999 48 Malvika Steel Ltd.
78 Vinay V. Mahashabde Chief (Technology Officer Products) 1,37,53,216 B.Tech 32 01-07-1986 53 -
Notes:
(1) Gross Remuneration Comprises salary, allowances, monetary value of perquisites, commission to the Directors and the Company’s contribution to Provident and Superannuation Funds but
excludes contribution to Gratuity Fund on the basis of actuarial valuation as separate figures are not available.
(2) The nature of employment in all cases is contractual.
(3) None of the employees mentioned above is a relative of any Director of the Company or Manager of the Company.
(4) *Indicates employed for the part of the Financial Year 2018-19.
On behalf of the Board of Directors
sd/-
N. CHANDRASEKARAN
Mumbai Chairman
151
April 25, 2019 DIN: 00121863
152
ANNEXURE 6
Form AOC-1
Statement containing salient features of the financial statements of the Subsidiaries/Joint Ventures/Associate Companies
Pursuant to Section 129(3) of the Companies Act, 2013
[Read with Rule 5 of the Companies (Accounts) Rules, 2014]
PART ‘A’- Summary of Financial Information of Subsidiary Companies
Profit Provision
Reserves Total Total Total Profit after Proposed
Sl. Date since when Reporting Exchange Share Capital* Turnover before for Ownership
Name of the Company & Surplus Assets Liabilities Investments Taxation Dividend
No. subsidiary was acquired currency rate@ (` crore) (` crore) Taxation Taxation (%)
(` crore) (` crore) (` crore) (` crore) (` crore) (` crore)
(` crore) (` crore)
1 ABJA Investment Co. Pte Ltd. April 12, 2013 USD 69.15 1.38 (170.32) 21,082.45 21,251.39 - - 111.58 18.82 92.77 - 100.00
2 Adityapur Toll Bridge Company Limited June 12, 2002 INR 1.00 46.78 3.08 65.79 15.93 15.93 7.87 2.52 (7.60) 10.12 - 88.50
3 Tata Steel Special Economic Zone Limited October 11, 2006 INR 1.00 460.43 (12.22) 472.60 24.39 - 0.38 (5.68) - (5.68) - 100.00
4 The Indian Steel & Wire Products Ltd December 20, 2003 INR 1.00 5.99 80.09 152.66 66.58 0.00 288.64 19.95 6.86 13.09 - 95.01
Jamshedpur Utilities & Services
5 August 25, 2003 INR 1.00 24.35 112.99 855.89 718.55 13.68 1,114.13 58.96 14.00 44.95 - 100.00
Company Limited
6 Haldia Water Management Limited December 6, 2008 INR 1.00 27.77 (104.46) 0.23 76.92 - - 97.20 - 97.20 - 60.00
37 Bore Samson Group Limited April 2, 2007 GBP 90.52 0.00 135.86 192.12 56.26 - - - - - - 100.00
38 Bore Steel Limited April 2, 2007 GBP 90.52 0.00 144.84 144.84 - - - - - - - 100.00
39 British Guide Rails Limited April 2, 2007 GBP 90.52 0.00 43.98 43.98 - - - - - - - 100.00
40 British Steel Corporation Limited April 2, 2007 GBP 90.52 163.63 112.50 276.14 - - - - - - - 100.00
41 British Steel Directors (Nominees) Limited April 2, 2007 GBP 90.52 0.00 - 0.00 - - - - - - - 100.00
British Steel Engineering Steels
42 April 2, 2007 GBP 90.52 0.00 - 0.11 0.11 - - - - - - 100.00
(Exports) Limited
43 British Steel Nederland International B.V. April 2, 2007 EUR 77.66 0.14 378.64 415.32 36.54 10.76 - 30.66 1.32 29.34 - 100.00
44 British Steel Service Centres Limited April 2, 2007 GBP 90.52 181.05 315.46 709.24 212.73 - - - - - - 100.00
45 British Tubes Stockholding Limited April 2, 2007 GBP 90.52 0.00 - 0.00 - - - - - - - 100.00
46 C V Benine April 2, 2007 EUR 77.66 16.83 (0.02) 96.51 79.69 - - - - - - 76.92
47 C Walker & Sons Limited April 2, 2007 GBP 90.52 31.68 115.40 630.49 483.40 - - - - - - 100.00
48 Catnic GmbH April 2, 2007 EUR 77.66 0.20 51.13 65.58 14.25 - 138.11 2.31 1.09 1.21 - 100.00
49 Catnic Limited April 2, 2007 GBP 90.52 2.03 (2.59) 0.17 0.72 - - - - - - 100.00
STATUTORY REPORTS | 89-194
50 CBS Investissements SAS April 2, 2007 EUR 77.66 0.62 1.45 3.37 1.29 - - 0.09 0.03 0.06 - 100.00
51 Cogent Power Inc. April 2, 2007 CAD 51.93 1.56 143.83 285.09 139.70 - 781.57 (12.29) (5.23) (7.06) - 100.00
52 Tata Steel Mexico SA de CV April 2, 2007 USD 69.15 0.03 0.69 1.88 1.16 - - 0.34 0.01 0.33 - 100.00
53 Cogent Power Inc. April 2, 2007 USD 69.15 2.07 (2.96) 0.42 1.30 - - (0.88) - (0.88) - 100.00
54 Cogent Power Limited April 2, 2007 GBP 90.52 386.24 (275.51) 418.71 307.98 - - (9.06) - (9.06) - 100.00
55 Color Steels Limited April 2, 2007 GBP 90.52 0.41 40.63 113.56 72.52 - - - - - - 100.00
56 Corbeil Les Rives SCI April 2, 2007 EUR 77.66 4.99 4.56 9.57 0.03 - - - - - - 67.30
Corby (Northants) & District Water
57 April 2, 2007 GBP 90.52 2.35 3.17 7.34 1.82 - 1.98 (0.00) 0.02 (0.02) - 100.00
Company Limited
58 Cordor (C& B) Limited April 2, 2007 GBP 90.52 0.00 2.94 2.94 - - - - - - - 100.00
59 Corus CNBV Investments April 2, 2007 GBP 90.52 0.00 - 0.00 - - - - - - - 100.00
60 Corus Cold drawn Tubes Limited April 2, 2007 GBP 90.52 45.26 (60.86) - 15.60 - - - - - - 100.00
61 Corus Engineering Steels (UK) Limited April 2, 2007 GBP 90.52 90.52 324.14 414.67 - - - - - - - 100.00
FINANCIAL STATEMENTS | 195-418
62 Corus Engineering Steels Holdings Limited April 2, 2007 GBP 90.52 3,764.76 270.32 5,124.34 1,089.26 - - - - - - 100.00
63 Corus Engineering Steels Limited April 2, 2007 GBP 90.52 4,183.07 121.85 4,304.92 - - - - - - - 100.00
Corus Engineering Steels Overseas
64 April 2, 2007 GBP 90.52 0.00 9.00 17.70 8.70 - - - - - - 100.00
Holdings Limited
Corus Engineering Steels Pension Scheme
65 GBP 90.52 0.00 - 0.00 - - - - - - - 100.00
Trustee Limited
66 Corus Group Limited April 2, 2007 GBP 90.52 15,838.48 (22,050.49) 9,557.26 15,769.27 - - (709.67) - (709.67) - 100.00
67 Corus Holdings Limited April 2, 2007 GBP 90.52 2.26 2.96 5.23 - - - - - - - 100.00
Corus International (Overseas
68 April 2, 2007 GBP 90.52 1,278.25 3,116.82 4,403.61 8.53 - - 75.04 - 75.04 - 100.00
Holdings) Limited
69 Corus International Limited April 2, 2007 GBP 90.52 4,438.98 (1,693.29) 2,986.67 240.98 0.21 - - - - - 100.00
70 Corus International Romania SRL. April 2, 2007 RON 16.30 0.01 0.55 0.70 0.14 - - 0.15 0.01 0.14 - 100.00
71 Corus Investments Limited April 2, 2007 GBP 90.52 199.15 6.16 205.31 - - - - - - - 100.00
72 Corus Ireland Limited April 2, 2007 EUR 77.66 0.00 7.42 8.03 0.61 - - 0.97 0.10 0.87 - 100.00
153
Profit Provision
154
Reserves Total Total Total Profit after Proposed
Sl. Date since when Reporting Exchange Share Capital* Turnover before for Ownership
Name of the Company & Surplus Assets Liabilities Investments Taxation Dividend
No. subsidiary was acquired currency rate@ (` crore) (` crore) Taxation Taxation (%)
(` crore) (` crore) (` crore) (` crore) (` crore) (` crore)
(` crore) (` crore)
73 Corus Large Diameter Pipes Limited April 2, 2007 GBP 90.52 0.00 658.49 672.33 13.84 - - - - - - 100.00
74 Corus Liaison Services (India) Limited April 2, 2007 GBP 90.52 9.05 (30.70) 1.62 23.26 - - - - - - 100.00
75 Corus Management Limited April 2, 2007 GBP 90.52 0.00 155.26 2,002.35 1,847.08 - - - - - - 100.00
76 Corus Primary Aluminium B.V. April 2, 2007 EUR 77.66 13.02 (134.83) 318.98 440.79 - - (3.65) (0.91) (2.74) - 100.00
77 Corus Property April 2, 2007 GBP 90.52 0.00 - 0.01 0.01 - - - - - - 100.00
78 Corus Service Centre Limited April 2, 2007 GBP 90.52 0.00 144.48 144.48 0.00 - - - - - - 100.00
79 Corus Steel Service STP LLC April 6, 2009 RUB 1.04 0.12 (0.62) 0.00 0.51 - - (0.33) - (0.33) - 100.00
80 Corus Tubes Poland Spolka Z.O.O October 12, 2006 PLZ 18.05 - 0.34 0.65 0.31 - - - - - - 100.00
81 Corus UK Healthcare Trustee Limited March 31, 2009 GBP 90.52 0.00 - 0.00 - - - - - - - 100.00
82 Corus Ukraine Limited Liability Company UAH 2.53 0.01 0.01 0.02 - - - - - - - 100.00
83 CPN (85) Limited April 2, 2007 GBP 90.52 0.00 - 0.00 - - - - - - - 100.00
84 Crucible Insurance Company Limited April 2, 2007 GBP 90.52 4.53 267.98 388.94 116.43 - - 36.52 - 36.52 - 100.00
85 Degels GmbH April 2, 2007 EUR 77.66 0.62 76.53 194.07 116.91 - 461.53 37.47 1.24 36.23 - 100.00
86 Demka B.V. April 2, 2007 EUR 77.66 47.79 20.30 68.09 - - - (0.02) (0.00) (0.01) - 100.00
87 DSRM Group Plc. April 2, 2007 GBP 90.52 45.26 134.37 179.63 - - - - - - - 100.00
88 Esmil B.V. April 2, 2007 EUR 77.66 112.74 (91.74) 21.05 0.05 - - 0.08 0.02 0.06 - 100.00
89 Europressings Limited April 2, 2007 GBP 90.52 0.00 - 0.00 - - - - - - - 100.00
122 Runblast Limited April 2, 2007 GBP 90.52 77.55 393.52 471.06 - - - - - - - 100.00
123 Runmega Limited April 2, 2007 GBP 90.52 3.94 - 3.94 - - - - - - - 100.00
124 S A B Profiel B.V. April 2, 2007 EUR 77.66 1.05 253.72 366.03 111.26 - 778.02 15.90 3.58 12.32 - 100.00
125 S A B Profil GmbH April 2, 2007 EUR 77.66 0.23 131.78 159.45 27.43 - 270.19 (0.61) 1.64 (2.24) (0.82) 100.00
126 Seamless Tubes Limited April 2, 2007 GBP 90.52 181.05 (12.96) 168.09 - - - - - - - 100.00
127 Service Center Gelsenkirchen GmbH EUR 77.66 142.98 33.67 458.44 281.79 0.70 1,174.58 21.39 1.61 19.79 (19.50) 100.00
128 Service Centre Maastricht B.V. April 2, 2007 EUR 77.66 0.42 51.60 694.82 642.80 - 1,937.79 (8.03) (0.58) (7.45) - 100.00
Societe Europeenne De
129 April 2, 2007 EUR 77.66 97.08 125.50 302.26 79.68 - 524.22 16.38 4.80 11.59 - 100.00
Galvanisation (Segal) Sa
130 Staalverwerking en Handel B.V. April 2, 2007 EUR 77.66 349.49 337.71 1,443.50 756.30 - - (4.90) (1.23) (3.68) - 100.00
131 Steel StockHoldings Limited April 2, 2007 GBP 90.52 0.00 41.47 41.71 0.24 - - - - - - 100.00
132 Steelstock Limited April 2, 2007 GBP 90.52 0.18 - 69.56 69.38 - - - - - - 100.00
133 Stewarts & Lloyds Of Ireland Limited April 2, 2007 EUR 77.66 0.74 (0.74) - - - - - - - - 100.00
STATUTORY REPORTS | 89-194
134 Stewarts And Lloyds (Overseas) Limited April 2, 2007 GBP 90.52 185.21 0.05 185.27 - - - - - - - 100.00
135 Surahammar Bruks AB April 2, 2007 SEK 7.45 44.69 7.36 130.83 78.79 - 216.24 (52.90) - (52.90) - 100.00
136 Swinden Housing Association Limited^^ April 2, 2007 GBP 90.52 0.00 11.31 11.36 0.04 - - - - - - 100.00
137 Tata Steel Belgium Packaging Steels N.V. April 2, 2007 EUR 77.66 119.87 30.36 190.26 40.03 - 106.79 10.04 3.38 6.66 - 100.00
138 Tata Steel Belgium Services N.V. April 2, 2007 EUR 77.66 130.84 73.34 554.88 350.70 32.32 - 2.13 (0.66) 2.79 (91.84) 100.00
139 Tata Steel Denmark Byggsystemer A/S April 2, 2007 DKK 10.47 0.52 21.29 23.27 1.46 - - 0.39 (0.25) 0.65 - 100.00
140 Tata Steel Europe Distribution BV April 2, 2007 EUR 77.66 5.68 (25.08) 54.36 73.77 - - 10.84 2.71 8.13 - 100.00
141 Tata Steel Europe Metals Trading BV EUR 77.66 0.10 288.10 532.27 244.06 - - 0.57 0.14 0.43 - 100.00
142 Tata Steel France Batiment et Systemes SAS April 2, 2007 EUR 77.66 31.07 (100.21) 269.23 338.37 1.02 465.78 (52.13) - (52.13) - 100.00
143 Tata Steel France Holdings SAS April 2, 2007 EUR 77.66 38.83 832.00 1,595.83 725.00 - - 1.70 31.50 (29.81) - 100.00
144 Tata Steel Germany GmbH April 2, 2007 EUR 77.66 1,027.19 (668.00) 1,192.96 833.78 - - 34.20 (10.17) 44.38 (111.31) 100.00
145 Tata Steel IJmuiden BV EUR 77.66 873.72 19,409.81 29,925.49 9,641.96 154.16 34,827.11 2,346.94 582.26 1,764.68 - 100.00
Tata Steel International
146 April 2, 2007 USD 69.15 4,510.87 (3,888.05) 1,864.25 1,241.43 - - 23.24 - 23.24 - 100.00
(Americas) Holdings Inc
FINANCIAL STATEMENTS | 195-418
147 Tata Steel International (Americas) Inc April 2, 2007 USD 69.15 61.55 1,148.17 1,306.33 96.61 - 270.65 18.89 (0.06) 18.95 - 100.00
Tata Steel International
148 April 2, 2007 CAD 51.93 0.05 1.88 1.94 - - - 0.09 - 0.09 - 100.00
(Canada) Holdings Inc
Tata Steel International (Czech
149 April 2, 2007 CZK 3.01 0.36 5.67 6.55 0.52 - - 4.57 0.89 3.68 (2.42) 100.00
Republic) S.R.O
150 Tata Steel International (Denmark) A/S April 2, 2007 DKK 10.47 0.95 1.86 5.75 2.94 - - 2.40 0.53 1.86 (0.88) 100.00
151 Tata Steel International (Finland) OY April 2, 2007 EUR 77.66 0.98 0.00 2.06 1.08 - - 0.00 - 0.00 - 100.00
152 Tata Steel International (France) SAS April 2, 2007 EUR 77.66 1.55 37.31 42.75 3.89 - - 2.51 0.36 2.15 - 100.00
153 Tata Steel International (Germany) GmbH April 2, 2007 EUR 77.66 6.76 (5.07) 65.56 63.88 - - 18.22 1.16 17.06 (12.87) 100.00
Tata Steel International (South America)
154 USD 69.15 1.49 (0.29) 1.52 0.31 - - 0.31 (0.04) 0.35 - 100.00
Representações LTDA
155 Tata Steel International (Italia) SRL April 2, 2007 EUR 77.66 58.64 (48.85) 27.44 17.65 - - (2.88) 50.61 (53.49) (10.87) 100.00
156 Tata Steel International (Middle East) FZE April 2, 2007 AED 18.86 84.89 37.40 150.80 28.51 - 109.91 19.01 - 19.01 - 100.00
155
157 Tata Steel International (Nigeria) Limited June 10, 2008 NGN 0.19 - - - - - - - - - - 100.00
Profit Provision
156
Reserves Total Total Total Profit after Proposed
Sl. Date since when Reporting Exchange Share Capital* Turnover before for Ownership
Name of the Company & Surplus Assets Liabilities Investments Taxation Dividend
No. subsidiary was acquired currency rate@ (` crore) (` crore) Taxation Taxation (%)
(` crore) (` crore) (` crore) (` crore) (` crore) (` crore)
(` crore) (` crore)
158 Tata Steel International (Poland) sp Zoo April 2, 2007 PLZ 18.05 15.90 (11.28) 5.25 0.63 - - 0.42 0.06 0.36 - 100.00
159 Tata Steel International (Schweiz) AG April 2, 2007 CHF 69.62 0.70 4.11 5.00 0.20 - - 0.04 - 0.04 - 100.00
160 Tata Steel International (Sweden) AB April 2, 2007 SEK 7.45 0.07 8.92 12.52 3.53 - - 2.87 0.66 2.20 - 100.00
161 Tata Steel International (India) Limited April 2, 2007 INR 1.00 6.39 39.40 54.69 8.90 - 11.07 2.93 - 2.93 - 100.00
162 Tata Steel International Iberica SA April 2, 2007 EUR 77.66 1.17 9.31 20.10 9.62 - - 11.59 2.51 9.08 (10.83) 100.00
Tata Steel Istanbul Metal
163 April 2, 2007 USD 69.15 79.71 (68.24) 188.67 177.20 - 324.34 (13.67) - (13.67) - 100.00
Sanayi ve Ticaret AS
164 Tata Steel Maubeuge SAS April 2, 2007 EUR 77.66 58.25 91.22 938.58 789.11 10.79 2,919.02 (70.64) 0.00 -70.64 - 100.00
165 Tata Steel Nederland BV April 2, 2007 EUR 77.66 3,010.30 9,214.30 16,182.49 3,957.89 - - 116.46 (99.22) 215.68 - 100.00
Tata Steel Nederland Consulting &
166 April 2, 2007 EUR 77.66 69.90 (73.79) 2.31 6.20 - - (0.00) (0.00) (0.00) - 100.00
Technical Services BV
167 Tata Steel Nederland Services BV April 2, 2007 EUR 77.66 3.30 255.67 630.99 372.01 - - 6.36 1.85 4.51 - 100.00
168 Tata Steel Nederland Star-Frame BV April 2, 2007 EUR 77.66 3.49 (3.37) 0.12 0.00 - - (0.03) (0.01) (0.02) - 100.00
169 Tata Steel Nederland Technology BV April 2, 2007 EUR 77.66 0.14 503.01 639.26 136.11 - - (2.36) (11.58) 9.22 - 100.00
170 Tata Steel Nederland Tubes BV April 2, 2007 EUR 77.66 372.79 (568.36) 713.65 909.23 - 1,681.55 (124.71) (48.25) (76.46) - 100.00
171 Tata Steel Netherlands Holdings B.V. EUR 77.66 39,484.49 (37,822.76) 45,129.70 43,467.97 - - (1,641.03) (307.38) (1,333.65) - 100.00
172 Tata Steel Norway Byggsystemer A/S April 2, 2007 NOK 8.03 0.98 52.57 84.94 31.39 - 189.47 4.80 1.07 3.73 - 100.00
201 Kalzip FZE November 1, 2012 AED 18.86 - - - - - 7.28 0.87 - 0.87 (3.59) -
202 Kalzip GmbH October 12, 2006 EUR 77.66 - - - - - - (0.01) - (0.01) (0.98) -
203 Kalzip GmbH October 12, 2006 EUR 77.66 - - - - - 185.53 5.91 1.83 4.08 - -
204 Kalzip India Private Limited INR 1.00 - - - - - 24.07 0.28 - 0.28 - -
205 Kalzip Italy SRL June 11, 2010 EUR 77.66 - - - - - - 0.06 0.03 0.03 (0.32) -
206 Kalzip Limited October 12, 2006 GBP 90.52 - - - - - - 0.09 - 0.09 - -
207 Kalzip Spain S.L.U. October 12, 2006 EUR 77.66 - - - - - - 0.06 0.02 0.04 (11.36) -
208 Tata Steel International Hellas SA EUR 77.66 - - - - - - - - - - -
209 T S Global Minerals Holdings Pte Ltd. August 1, 2008 USD 69.15 9,121.54 (6,595.74) 5,782.95 3,257.15 3,110.47 - (1,143.18) 17.24 (1,160.42) - 100.00
210 Al Rimal Mining LLC February 25, 2008 OMR 180.19 18.02 (11.45) 9.54 2.98 - - (0.00) - (0.00) - 70.00
211 Kalimati Coal Company Pty. Ltd. August 1, 2009 AUD 49.16 29.50 (29.49) 0.00 0.00 - - 223.44 - 223.44 - 100.00
212 TSMUK Limited September 23, 2010 USD 69.15 4,074.90 (389.90) 7,498.52 3,813.53 2,005.21 - (0.07) - (0.07) - 100.00
213 T S Canada Capital Ltd December 31, 2012 USD 69.15 0.00 34.76 34.80 0.05 - - (0.12) 0.04 (0.16) - 100.00
214 Tata Steel Minerals Canada Limited December 31, 2010 USD 69.15 6,071.78 (3,271.68) 7,025.56 4,225.46 - - (48.61) - (48.61) - 77.68
STATUTORY REPORTS | 89-194
215 Black Ginger 461 (Proprietary) Ltd March 6, 2008 ZAR 4.77 - - - - - 11.18 27.05 - 27.05 - -
216 Sedibeng Iron Ore Pty. Ltd. February 24, 2011 ZAR 4.77 - - - - - 730.88 168.35 44.66 123.69 - -
217 Tata Steel Cote D’ Ivoire S.A May 15, 2012 FCFA 0.12 - - - - - - (0.61) - (0.61) - -
Tata Steel International (Singapore)
218 January 25, 2008 USD 69.15 479.13 (4.35) 488.88 14.10 9.01 1.42 111.04 0.97 110.07 - 100.00
Holdings Pte. Ltd.
219 Tata Steel International (Singapore) Pte. Ltd.January 25, 2008 USD 69.15 8.51 (8.51) - - - - (8.97) - (8.97) - 100.00
220 Tata Steel International (Asia) Limited January 25, 2008 HKD 8.83 0.00 6.26 6.26 - - 248.95 4.98 - 4.98 - 100.00
221 Tata Steel International (Thailand) Limited THB 2.18 - - - - - - - - - - -
222 TSIA Holdings (Thailand) Limited THB 2.18 - - - - - - - - - - -
223 Tata Steel International (Shanghai) Ltd. January 25, 2008 CNY 10.32 5.04 0.77 5.94 0.14 - 4.28 0.39 0.01 0.38 - 100.00
224 Tata Steel (Thailand) Public Company Ltd. April 4, 2006 THB 2.18 1,835.22 1,074.16 3,336.93 427.55 - 93.47 13.97 (0.07) 14.04 - 67.90
225 N.T.S Steel Group Plc. April 4, 2006 THB 2.18 1,008.53 (920.46) 1,179.90 1,091.84 - 4,656.21 (63.39) (0.01) (63.38) - 99.76
226 The Siam Construction Steel Co. Ltd. April 4, 2006 THB 2.18 381.36 171.92 755.46 202.19 0.00 2,046.87 27.81 5.21 22.60 - 99.99
FINANCIAL STATEMENTS | 195-418
227 The Siam Iron And Steel (2001) Co. Ltd. April 4, 2006 THB 2.18 26.15 241.74 421.92 154.03 - 1,109.40 (5.47) (0.15) (5.32) - 99.99
228 T S Global Procurement Company Pte. Ltd. April 23, 2010 USD 69.15 688.93 1,739.72 28,513.71 26,085.06 - 30,144.07 406.67 72.69 333.98 - 100.00
229 ProCo Issuer Pte. Ltd. September 8, 2010 GBP 90.52 0.00 181.33 8,130.55 7,949.22 - 628.86 64.86 10.87 53.99 - 100.00
230 Tata Steel Odisha Limited June 22, 2012 INR 1.00 2.57 -2.59 0.02 0.04 - - (0.01) - (0.01) - 100.00
Tata Steel Processing and
231 July 14, 2009 INR 1.00 68.25 613.18 1,512.68 831.25 - 4,280.92 117.78 41.68 76.10 - 100.00
Distribution Limited
232 Tayo Rolls Limited December 1, 2008 INR 1.00 10.26 -478.47 62.03 530.24 0.00 - (19.89) - (19.89) - 54.91
233 The Tata Pigments Limited May 18, 1985 INR 1.00 0.75 53.26 87.38 33.36 24.93 115.70 6.86 1.98 4.88 0.75 100.00
234 The Tinplate Company of India Ltd April 1, 2011 INR 1.00 104.80 606.31 1,176.33 465.23 96.96 2,611.10 91.77 33.78 58.00 20.93 74.96
235 Tata Steel Foundation August 16, 2016 INR 1.00 1.00 0.71 12.95 11.24 2.07 43.66 (6.94) - (6.94) - 100.00
Jamshedpur Football and
236 July 7, 2017 INR 1.00 32.00 (19.08) 24.67 11.75 0.06 46.52 (10.92) 0.00 (10.93) - 100.00
Sporting PrivateLimited
237 Sakchi Steel Limited January 16, 2018 INR 1.00 0.01 (0.01) 0.00 0.00 - - (0.01) - (0.01) - 100.00
238 Jugsalai Steel Limited January 18, 2018 INR 1.00 0.01 (0.01) 0.00 0.00 - - (0.01) - (0.01) - 100.00
157
Profit Provision
158
Reserves Total Total Total Profit after Proposed
Sl. Date since when Reporting Exchange Share Capital* Turnover before for Ownership
Name of the Company & Surplus Assets Liabilities Investments Taxation Dividend
No. subsidiary was acquired currency rate@ (` crore) (` crore) Taxation Taxation (%)
(` crore) (` crore) (` crore) (` crore) (` crore) (` crore)
(` crore) (` crore)
239 Noamundi Steel Limited January 18, 2018 INR 1.00 0.01 (0.01) 0.00 0.00 - - (0.01) - (0.01) - 100.00
240 Straight Mile Steel Limited January 15, 2018 INR 1.00 0.01 (0.01) 0.00 0.00 - - (0.01) - (0.01) - 100.00
241 Bistupur Steel Limited January 18, 2018 INR 1.00 0.01 (0.01) 0.00 0.00 - - (0.01) - (0.01) - 100.00
242 Jamadoba Steel Limited January 19, 2018 INR 1.00 0.01 (0.01) 0.00 0.00 - - (0.01) - (0.01) - 100.00
243 Dimna Steel Limited January 24, 2018 INR 1.00 0.01 (0.01) 0.00 0.00 - - (0.01) - (0.01) - 100.00
244 Bhubaneshwar Power Private Limited August 6, 2008 INR 1.00 253.25 25.34 1,024.50 745.91 - 540.63 64.03 4.36 59.67 - 100.00
245 Bamnipal Steel Limited January 19, 2018 INR 1.00 258.90 (15.66) 403.85 160.62 170.14 - (15.66) - (15.66) - 100.00
246 Tata Steel BSL Limited May 18, 2018 INR 1.00 218.69 18,115.58 39,609.13 21,274.86 1,595.76 18,261.32 (879.83) - (879.83) - 72.65
247 Bhushan Steel (Orissa) Limited May 18, 2018 INR 1.00 0.05 (0.02) 0.03 0.00 - - (0.01) - (0.01) - 100.00
248 Bhushan Steel (South) Limited May 18, 2018 INR 1.00 0.05 (1.06) 0.00 1.01 - - (0.76) - (0.76) - 100.00
249 Bhushan Steel Madhya Bharat Limited May 18, 2018 INR 1.00 0.05 (0.02) 0.03 0.00 - - (0.01) - (0.01) - 100.00
250 Bhushan Steel (Australia) PTY Ltd. May 18, 2018 AUD 49.16 269.47 (262.78) 12.85 6.16 - - (0.24) - (0.24) - 90.97
251 Bowen Energy PTY Ltd. May 18, 2018 AUD 49.16 89.00 (111.90) 0.17 23.07 - - (0.23) - (0.23) - 100.00
252 Bowen Coal PTY Ltd. May 18, 2018 AUD 49.16 0.00 0.00 0.00 - - - - - - - 100.00
253 Bowen Consolidated PTY Ltd. May 18, 2018 AUD 49.16 0.00 0.00 0.00 - - - - - - - 100.00
254 Creative Port Development Private Limited September 18, 2018 INR 1.00 0.25 (1.06) 24.37 25.18 - - (0.06) 0.00 (0.06) - 51.00
3 S & T Mining Company Private Limited March 31, September 18, 2008 INR 1,29,41,400 12.94 50.00 1 - (4.61) - (2.69)
4 Tata BlueScope Steel Private Limited March 31, February 9, 2005 INR 43,30,00,000 433.00 50.00 1 - 400.52 80.71 80.27
5 BlueScope Lysaght Lanka (Pvt) Ltd March 31, April 1, 2015 LKR 1,06,35,000 4.19 100.00 5 - 8.54 (0.03) -
6 Tata NYK Shipping Pte Ltd. March 31, March 19, 2007 USD 6,51,67,500 350.14 50.00 1 - 85.67 14.78 14.78
7 Tata NYK Shipping (India) Private Limited March 31, April 1, 2015 INR 12,50,000 0.13 100.00 5 - 1.74 0.04 0.04
Jamshedpur Continuous Annealing & Processing
8 March 31, August 17, 2012 INR 62,83,20,000 628.32 51.00 4 - 371.37 17.26 16.59
Company Private Limited
9 T M Mining Company Limited - December 22, 2010 INR 2,29,116 0.23 74.00 4 $ - - -
10 TM International Logistics Limited March 31, January 18, 2002 INR 91,80,000 9.18 51.00 4 - 198.72 19.76 18.98
11 International Shipping and Logistics FZE March 31, February 1, 2004 USD 1 1.24 100.00 5 - 232.62 3.83 3.68
12 TKM Global China Ltd. March 31, June 25, 2008 CNY 1 4.39 100.00 5 - 3.84 0.14 0.13
13 TKM Global GmbH March 31, March 1, 2005 EUR 100 1.11 100.00 5 - 182.77 1.57 1.51
14 TKM Global Logistics Limited March 31, January 18, 2002 INR 36,00,000 5.16 100.00 5 - 27.72 1.79 1.72
15 Industrial Energy Limited March 31, - INR 17,31,60,000 173.16 26.00 1 - 199.33 28.89 82.23
16 Jamipol Limited March 31, April 24, 1995 INR 44,75,000 9.18 39.78 1 - 64.08 9.43 14.28
17 Nicco Jubilee Park Limited - May, 2001 INR 3,40,000 - 25.31 1 - - - -
18 Medica TS Hospital Private Limited - August 5, 2014 INR 2,60,000 0.26 26.00 1 - - - -
19 SEZ Adityapur Limited. March 31, October 30, 2006 INR 25,497 0.03 51.00 5 - (0.04) - (0.01)
20 Naba Diganta Water Management Limited March 31, January 9, 2008 INR 1,36,53,000 13.65 74.00 5 - 16.89 2.73 0.96
STATUTORY REPORTS | 89-194
21 Air Products Llanwern Limited September 30, April 2, 2007 GBP 50,000 0.45 50.00 2 - 7.02 2.82 2.82
22 Laura Metaal Holding B.V. December 31, April 2, 2007 EUR 2,744 9.67 49.00 2 - 159.78 24.55 25.55
23 Ravenscraig Limited December 31, April 2, 2007 GBP 100 0.00 33.33 2 - (49.24) (3.65) (7.30)
24 Tata Steel Ticaret AS December 31, April 2, 2007 TRY 80,000 0.10 50.00 2 - 16.32 8.25 8.25
25 Texturing Technology Limited March 31, April 2, 2007 GBP 10,00,000 9.05 50.00 2 - 12.40 4.66 4.66
26 Hoogovens Court Roll Service Technologies VOF March 31, April 2, 2007 EUR - 10.45 50.00 2 - 17.74 1.37 1.37
27 Minas De Benga (Mauritius) Limited March 31, November 30, 2007 USD 27,13,43,558 2,439.05 35.00 2 - (1,165.76) (44.90) (83.39)
28 Andal East Coal Company Private Limited March 31, May 18, 2018 INR 3,30,000 1.46 33.89 1 ** - - -
29 Afon Tinplate Company Limited April 2, 2007 GBP - - - 2 - - - -
30 Bsr Pipeline Services Limited April 2, 2007 EUR - - - 1 - - - -
31 TVSC Construction Steel Solutions Limited May 30, 2014 HKD - - - 2 - - (2.44) (2.44)
B. Associate
1 Kalinga Aquatic Ltd - - INR 10,49,920 - 30.00 1 ** - - -
2 Kumardhubi Fireclay & Silica Works Ltd - - INR 1,50,001 - 27.78 1 ** - - -
3 Kumardhubi Metal Casting and Engineering Limited - - INR 10,70,000 - 49.31 1 ** - - -
Not consolidated, as
4 Strategic Energy Technology Systems Private Limited - - INR 2,56,14,500 25.61 25.00 1 the investment value - - -
is impaired
5 Tata Construction & Projects Ltd. - - INR 11,97,699 - 27.19 1 ** - - -
FINANCIAL STATEMENTS | 195-418
6 TRF Limited. March 31, October 16, 1963 INR 37,53,275 5.79 34.11 1 - (22.89) (36.01) (69.56)
7 TRF Singapore Pte Limited March 31, April 1, 2015 SGD 2,59,83,481 91.81 100.00 5 - 44.93 6.79 13.11
8 TRF Holdings Pte Limited March 31, April 1, 2015 USD 1 0.00 100.00 5 - 0.00 15.15 29.27
9 Dutch Lanka Trailer Manufacturers Limited March 31, April 1, 2015 USD 15,23,06,150 123.25 100.00 5 - 8.11 3.78 7.29
10 Dutch Lanka Engineering (Private) Limited March 31, April 1, 2015 LKR 11,50,000 0.60 100.00 5 - 1.61 0.10 0.19
11 Dutch Lanka Trailer LLC - April 1, 2015 OMR 1,05,000 1.45 70.00 1 - - (0.23) (0.75)
12 Hewitt Robins International Ltd March 31, April 1, 2015 GBP 2,000 27.83 100.00 5 - 15.32 1.68 3.25
13 Hewitt Robins International Holdings Ltd March 31, April 1, 2015 GBP 200 57.57 100.00 5 - 0.23 - -
14 YORK Transport Equipment (India) Private Limited March 31, April 1, 2015 INR - - - 5 - - 0.45 0.87
15 YORK Transport Equipment (Asia) Pte Ltd March 31, April 1, 2015 USD - - - 5 - - (0.56) (1.09)
16 YORK Transport Equipment Pty Ltd March 31, April 1, 2015 AUD - - - 5 - - (0.06) (0.11)
17 YORK Sales (Thailand) Co. Ltd March 31, April 1, 2015 THB - - - 5 - - (0.31) (0.60)
18 York Transport Equipment (SA) (Pty) Ltd March 31, April 1, 2015 ZAR - - - 5 - - (0.02) (0.05)
19 Rednet Pte Ltd. March 31, April 1, 2015 USD - - - 5 - - (0.00) (0.00)
20 YTE Special Products Pte Ltd March 31, April 1, 2015 USD - - - 5 - - 0.01 0.02
21 Qingdao YTE Special Products Co. Ltd March 31, April 1, 2015 CNY - - - 5 - - (0.77) (1.48)
22 YORK Transport Equipment (Shanghai) Co. Ltd March 31, April 1, 2015 CNY - - - 5 - - (0.03) (0.05)
23 PT York Engineering April 1, 2015 USD - - - 5 - - - -
24 Malusha Travels Pvt Ltd - August 5, 2014 INR 3,352 0.00 33.23 1 - - - -
159
25 European Profiles (M) Sdn. Bhd. December 31, January 25, 2008 MYR 7,00,000 1.19 20.00 3 @ - - 0.33
26 Albi Profils SRL December 31, - EUR 1,800 0.71 30.00 2 # - - -
No. of shares held Amount of Net worth Share of profit/loss for the year
160
Date on which the Description Reason why the
Latest audited by the company Investment in attributable to (` crore)
Associate or Joint Reporting Extend of of how there associate/joint
Sl. No. Name of the Entity balance sheet in associate/joint associate/joint shareholding
Venture was associated currency* holding (%) is significant venture Considered in Not considered
date venture on the venture as per latest
or acquired influence is not consolidated consolidation in consolidation
year end (` crore) balance sheet
27 GietWals Onderhoud Combinatie B.V. December 31, April 2, 2007 EUR 50 10.24 50.00 2 - 19.69 (12.42) (12.42)
455,000 shares of the
variable part; 25,000
28 Hoogovens Gan Multimedia S.A. De C.V. Unknown April 2, 2007 MXN of the minimum fixed 0.01 50.00 2 # - - -
part of the capital
stock
29 ISSB Limited June 30, April 2, 2007 GBP 500 0.00 50.00 2 # - - -
30 Wupperman Staal Nederland B.V. December 31, April 2 2007 EUR 2,400 66.27 30.00 2 - 126.48 14.97 34.92
31 Fabsec Limited December 31, May 18 2001 GBP 250 0.00 25.00 2 # - - -
32 New Millennium Iron Corp. March 31, - CAD 4,74,02,908 340.08 26.18 1 - 35.10 (3.74) (10.54)
33 9336-0634 Québec Inc - March 30, 2017 CAD 1 - 33.33 1 $ - - -
34 Bhushan Energy Limited March 31, May 18, 2018 INR 6,50,00,000 350.00 47.71 5 & - - -
35 Bhushan Capital & Credit Services Private Limited March 31, May 18, 2018 INR 86,43,742 9.40 42.58 5 - - - -
36 Jawahar Credit & Holdings Private Limited March 31, May 18, 2018 INR 86,43,742 9.40 39.65 5 - - - -
37 TRL Krosaki Refractories Limited - May 31, 2011 INR - - - 1 - - 12.76 35.17
Notes
1 Controls more than 20% of the total share capital
2 Controls more than 20% of the total share capital and has significant influence over operational and financial decision making
3 Insignificant influence on the financial and operating policy decisions
4 More than 50% stake, instead considered as joint venture as there is less significant influence over the control of the entity
5 Under the Ind AS regime, associate/joint venture of a subsidiary is also an indirect associate/joint venture & subsidiary of an associate/joint venture is also an indirect associate/
joint venture
@ No control over financial and operating policies and hence not considered for consolidation
Names of associates or joint ventures which have been liquidated or sold during the year
1 Afon Tinplate Company Limited
2 BSR Pipeline Services Limited
3 TVSC Construction Steel Solutions Limited
4 TRL Krosaki Refractories Limited
5 York Transport Equipment (Asia) Pte Ltd
6 York Transport Equipment (India) Pvt Ltd
7 York Transport Equipment Pty Ltd
8 York Sales (Thailand) Company Limited
9 York Transport Equipment (SA) (Pty) Ltd
10 Rednet Pte Ltd
11 PT York Engineering
12 YTE Special Products Pte. Limited
13 Qingdao YTE Special Products Co. Limited
14 York Transport Equipment (Shanghai) Co. Ltd
ANNEXURE 7
Companies that have become/ceased to be Company’s Subsidiaries
or Associate Companies (including Joint Venture Companies)
The names of companies which have become Subsidiaries or Associate Companies (including Joint Venture Companies) during the year:
The names of companies which have ceased to become Subsidiaries or Associate Companies (including Joint Venture Companies) during the year:
161
INFORMATION ON SUBSIDIARIES, ETC. | SECRETARIAL AUDIT REPORT
sd/-
N. CHANDRASEKARAN
Mumbai Chairman
April 25, 2019 DIN: 00121863
ANNEXURE 8
Form No. MR-3
Secretarial Audit Report for the Financial Year Ended March 31, 2019
Pursuant to section 204 (1) of the Companies Act, 2013
[Read with rule no. 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]
163
SECRETARIAL AUDIT REPORT
8. On September 22, 2018, the Company, as a part of strategy 10. On June 30, 2018, the Company and thyssenkrupp AG signed
to grow in long products, executed definitive agreements for definitive agreements to combine the European Steel Business
acquisition of steel business of Usha Martin Limited (‘UML’), in a 50:50 joint venture. This follows the signing of Memorandum
a special steel and wire rope manufacturer, through a slump of Understanding in September 2017. Only after completion
sale on a going concern basis. Tata Sponge Iron Limited (TSIL) of the JV process, thyssenkrupp Steel Europe and Tata Steel in
is an indirect subsidiary of the Company (54% shareholding). Europe will be integrated as one company.
On October 24, 2018, the Company extended support for
TSIL’s entry into steel business and identified it as the strategic For Parikh & Associates
Company Secretaries
vehicle for acquisition of steel business of UML. On April 9, 2019,
TSIL completed the acquisition of steel business undertaking
sd/-
including captive power plants, for a cash consideration payable
P. N. PARIKH
to UML of `4,094 crore, which is subject to further hold backs
Place: Mumbai Partner
of `640 crore, pending transfer of some of the assets including
Date: April 25, 2019 FCS No.: 327 CP No.: 1228
mines and certain land parcels.
9.
On September 18, 2018, the Company completed the This Report is to be read with our letter of even date which is annexed
acquisition of 51% equity stake in Creative Port Development as Annexure A and Forms an integral part of this report.
Private Limited.
ANNEXURE A
To,
The Members
Tata Steel Limited
sd/-
P. N. PARIKH
Place: Mumbai Partner
Date: April 25, 2019 FCS No.: 327 CP No.: 1228
165
EXTRACT OF ANNUAL RETURN
ANNEXURE 9
Form No. MGT 9
Extract of Annual Return as on March 31, 2019
Pursuant to Section 92(3) of the Companies Act, 2013
[Read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014]
167
EXTRACT OF ANNUAL RETURN
169
EXTRACT OF ANNUAL RETURN
171
EXTRACT OF ANNUAL RETURN
173
EXTRACT OF ANNUAL RETURN
175
EXTRACT OF ANNUAL RETURN
177
EXTRACT OF ANNUAL RETURN
IV Share Holding Pattern (Equity Share Capital Breakup as Percentage of Total Equity)
A Fully Paid-Up Equity Shares
i) Category-wise Share Holding
Sl Category of Number of shares held (April 1, 2018) Number of shares held (March 31, 2019)
% Change
No. Shareholders Electronic Physical Total % Electronic Physical Total %
(A) Promoters (including Promoter Group)
(1) Indian
(a) Individuals/Hindu Undivided Family - - - - - - - - -
(b) Central Government - - - - - - - - -
(c) State Government(s) - - - - - - - - -
(d) Bodies Corporate 35,98,80,277 - 35,98,80,277 31.95 35,98,80,601 - 35,98,80,601 31.95 -
(e) Financial Institutions/Banks - - - - - - - - -
(f) Any Other (Trust) 10,31,460 - 10,31,460 0.09 - - - - (0.09)
Sub-Total (A) (1) 36,09,11,737 - 36,09,11,737 32.04 35,98,80,601 - 35,98,80,601 31.95 (0.09)
(2) Foreign
Individuals
(a) - - - - - - - - -
Non-Resident Individuals
(b) Other Individuals - - - - - - - - -
(c) Bodies Corporate - - - - - - - - -
(d) Banks/FI - - - - - - - - -
(e) Qualified Foreign Investor - - - - - - - - -
(f) Any Other (specify) - - - - - - - - -
Sub-Total (A) (2) - - - - - - - - -
Total Shareholding of Promoter and
36,09,11,737 - 36,09,11,737 32.04 35,98,80,601 - 35,98,80,601 31.95 (0.09)
Promoter Group (A) = (A)(1)+(A)(2)
(B) Public Shareholding
(1) Institutions
(a) Mutual Funds 14,75,65,586 26,658 14,75,92,244 13.10 16,46,08,291 26,357 16,46,34,648 14.61 1.51
(b) Financial Institutions/Banks 18,95,090 1,60,202 20,55,292 0.18 43,13,216 1,59,322 44,72,538 0.40 0.21
(c) Central Government 6,83,823 - 6,83,823 0.06 12,17,242 - 12,17,242 0.11 0.05
(d) State Governments(s) 500 1,11,277 1,11,777 0.01 500 1,11,277 1,11,777 0.01 -
(e) Venture Capital Funds - - - - - - - - -
(f) Insurance Companies 15,21,05,744 1,380 15,21,07,124 13.50 16,98,31,669 1,230 16,98,32,899 15.08 1.57
(g) Foreign Institutional Investors 21,61,08,805 16,945 21,61,25,750 19.19 17,18,86,794 15,070 17,19,01,864 15.26 (3.93)
(h) Foreign Venture Capital Investors - - - - - - - - -
(i) Any Other (specify)
Sl Category of Number of shares held (April 1, 2018) Number of shares held (March 31, 2019)
% Change
No. Shareholders Electronic Physical Total % Electronic Physical Total %
(i - 1) Qualified Foreign Investor - - - - - - - - -
(i - 2) Foreign Institutional Investors - DR - - - - - - - - -
(i - 3) Foreign Bodies – DR 5,66,956 - 5,66,956 0.05 3,23,635 - 3,23,635 0.03 (0.02)
Foreign Portfolio
(i - 4) 892 - 892 - 892 - 892 - -
Investments – Individual
(i - 5) Foreign National- DR 164 - 164 - 164 - 164 - -
(i - 6) Alternate Investment Funds 1,000 - 1,000 - 34,095 - 34,095 - -
(i - 7) Foreign National 762 - 762 - 2,105 - 2,105 - -
(i – 8) UTI 15,191 16,387 31,578 - 260 16,197 16,457 - -
Sub-Total (B) (1) 51,89,44,513 3,32,849 51,92,77,362 46.10 51,22,18,863 3,29,453 51,25,48,316 45.50 (0.60)
(2) Non-Institutions
(a) Bodies Corporate
i Indian 1,48,89,046 2,42,642 1,51,31,688 1.34 1,50,18,429 2,26,070 1,52,44,499 1.35 0.01
ii Overseas 4,500 - 4,500 - 4,500 - 4,500 - -
(b) Individuals -
Individual shareholders holding
i 13,41,07,082 1,84,82,698 15,25,89,780 13.55 14,38,58,160 1,54,73,274 15,93,31,434 14.14 0.60
nominal share capital up to `1 lakh
Individual shareholders holding
ii nominal share capital in 3,23,54,125 18,43,873 3,41,97,998 3.04 2,85,38,493 15,23,841 3,00,62,334 2.67 (0.37)
excess of `1 lakh
(c) Any Other
i Trusts 70,93,589 51,28,424 1,22,22,013 1.08 1,09,08,766 34,02,549 1,43,11,315 1.27 0.19
ii IEPF Account 28,71,968 - 28,71,968 0.25 32,58,266 - 32,58,266 0.29 0.03
Iii HUF 51,47,726 2,740 51,50,466 0.46 54,84,862 1,973 54,86,835 0.49 0.03
Iv Clearing Member 1,12,34,497 - 1,12,34,497 1.00 99,38,585 - 99,38,585 0.88 (0.12)
v LLP/LLP-DR 1,52,155 - 1,52,155 0.01 29,49,037 - 29,49,037 0.26 0.25
(d) Qualified Foreign Investor - - - - - - - - -
Sub-total (B) (2) 20,78,54,688 2,57,00,377 23,35,55,065 20.73 21,99,59,098 2,06,27,707 24,05,86,805 21.35 0.62
Total Public Shareholding (B) =
72,67,99,201 2,60,33,226 75,28,32,427 66.83 73,21,77,961 2,09,57,160 75,31,35,121 66.85 0.02
(B)(1)+(B)(2)
Shares held by Custodians and
(C) against which Depository Receipts 1,27,40,651 - 1,27,40,651 1.13 1,34,73,958 - 1,34,73,958 1.20 0.06
have been issued*
GRAND TOTAL (A)+(B)+(C) 1,10,04,51,589 2,60,33,226 1,12,64,84,815 100.00 1,10,55,32,520 2,09,57,160 1,12,64,89,680 100.00
Note:
*This represents public non-institutional shareholding.
179
EXTRACT OF ANNUAL RETURN
iv) Shareholding Pattern of Top Ten Shareholders (Other than Directors, Promoters and Holders of GDRs and ADRs):
Shareholding Cumulative Shareholding during the year
Sl.
Name of shareholders % of total shares % of total shares of
No No. of shares No. of shares
of the Company the Company
1 Life Insurance Corporation of India
At the beginning of the year 10,83,88,660 9.62 10,83,88,660 9.62
Bought during the year - - 10,83,88,660 9.62
Sold during the year - - 10,83,88,660 9.62
At the end of the year 10,83,88,660 9.62 10,83,88,660 9.62
2 HDFC Trustee Company Limited
At the beginning of the year 3,73,29,326 3.31 3,73,29,326 3.31
Bought during the year 1,15,10,783 1.02 4,88,40,109 4.34
Sold during the year (54,47,012) (0.48) 4,33,93,097 3.85
At the end of the year 4,33,93,097 3.85 4,33,93,097 3.85
3 Reliance Capital Trustee Co. Ltd.
At the beginning of the year 3,60,62,228 3.20 3,60,62,228 3.20
Bought during the year 1,63,98,731 1.46 5,24,60,959 4.66
Sold during the year (1,50,13,679) (1.33) 3,74,47,280 3.32
At the end of the year 3,74,47,280 3.32 3,74,47,280 3.32
4 Aditya Birla Sun Life Trustee Private Limited
At the beginning of the year 1,62,03,057 1.44 1,62,03,057 1.44
Bought during the year 1,86,51,356 1.66 3,48,54,413 3.09
Sold during the year (1,51,23,141) (1.34) 1,97,31,272 1.75
At the end of the year 1,97,31,272 1.75 1,97,31,272 1.75
5 ICICI Prudential Mutual Fund
At the beginning of the year 1,18,41,996 1.05 1,18,41,996 1.05
Bought during the year 1,29,46,144 1.15 2,47,88,140 2.20
Sold during the year (78,19,446) (0.69) 1,69,68,694 1.51
At the end of the year 1,69,68,694 1.51 1,69,68,694 1.51
6 ICICI Prudential Life Insurance Company Ltd.
At the beginning of the year 15,14,260 0.13 15,14,260 0.13
Bought during the year 1,55,29,496 1.38 1,70,43,756 1.51
Sold during the year (16,74,061) (0.15) 1,53,69,695 1.36
At the end of the year 1,53,69,695 1.36 1,53,69,695 1.36
181
EXTRACT OF ANNUAL RETURN
Number of shares held (April 1, 2018) Number of shares held (March 31, 2019)
Sl.
Category of Shareholders % of Total % of Total % Change
No. Electronic Physical Total Electronic Physical Total
Shares Shares
(2) Non-Institutions
(a) Bodies Corporate
i Indian 10,75,316 1,800 10,77,116 1.39 12,12,265 1,662 12,13,927 1.56 0.18
ii Overseas - - - - - - - - -
(b) Individuals -
Individual shareholders holding nominal
i 76,79,326 2,75,030 79,54,356 10.24 1,48,23,765 2,05,279 1,50,29,044 19.36 19.36
share capital up to `1 lakh
Individual shareholders holding nominal
ii 20,53,660 8 20,53,668 2.64 20,49,177 - 20,49,177 2.64 (0.01)
share capital in excess of `1 lakh
(c) Any Other -
i Trusts 3,92,562 48 3,92,610 0.51 2,23,908 - 2,23,908 0.29 (0.22)
ii IEPF Account - - - - - - - - -
iii HUF 5,10,495 488 5,10,983 0.66 12,24,366 347 12,24,713 1.58 0.92
iv Clearing Member 3,46,741 - 3,46,741 0.45 40,71,561 - 40,71,561 5.24 4.80
v LLP/LLP-DR 4,18,480 - 418480 0.54 4,42,340 - 4,42,340 0.57 0.03
(d) Qualified Foreign Investor - - - - - - - - -
Sub-total (B) (2) 1,24,76,580 2,77,374 1,27,53,954 16.43 2,40,47,382 2,07,288 2,42,54,670 31.24 14.81
Total Public Shareholding (B) = (B)(1)+(B)(2) 3,84,14,220 2,77,568 3,86,91,788 49.84 3,84,86,418 2,07,288 3,86,93,706 49.84 -
Shares held by Custodians and
(C) against which Depository Receipts - - - - - - - - -
have been issued
GRAND TOTAL (A)+(B)+(C) 7,73,57,057 2,77,568 7,76,34,625 100.00 7,74,29,417 2,07,288 7,76,36,705 100.00
183
EXTRACT OF ANNUAL RETURN
iv) Shareholding Pattern of Top Ten Shareholders (Other than Directors, Promoters and Holders of GDRs and ADRs):
Cumulative Shareholding
Shareholding
Sl. during the year
Name of shareholders
No. % of total shares % of total shares of
No. of shares No. of shares
of the Company the Company
1 Reliance Capital Trustee Co. Ltd.
At the beginning of the year 78,27,234 10.08 78,27,234 10.08
Bought during the year 22,54,608 2.90 1,00,81,842 12.98
Sold during the year (45,12,233) (5.81) 55,69,609 7.17
At the end of the year 55,69,609 7.17 55,69,609 7.17
2 HDFC Trustee Company Limited
At the beginning of the year 25,21,807 3.25 25,21,807 3.25
Bought during the year - - 25,21,807 3.25
Sold during the year (74,319) (0.10) 24,47,488 3.15
At the end of the year 24,47,488 3.15 24,47,488 3.15
3 The New India Assurance Company Limited
At the beginning of the year 7,76,084 1.00 7,76,084 1.00
Bought during the year - - 7,76,084 1.00
Sold during the year - - 7,76,084 1.00
At the end of the year 7,76,084 1.00 7,76,084 1.00
4 Edelcap Securities Limited
At the beginning of the year 2,160 - 2,160 -
Bought during the year 5,89,254 0.76 5,91,414 0.76
Sold during the year (2,160) - 5,89,254 0.76
At the end of the year 5,89,254 0.76 5,89,254 0.76
5 Jhunjhunwala Rekha Rakesh
At the beginning of the year 5,00,000 0.64 5,00,000 0.64
Bought during the year 40,000 0.05 5,40,000 0.70
Sold during the year - - 5,40,000 0.70
At the end of the year 5,40,000 0.70 5,40,000 0.70
6 Government Pension Fund Global
At the beginning of the year 7,18,974 0.93 7,18,974 0.93
Bought during the year - - 7,18,974 0.93
Sold during the year (2,05,566) (0.27) 5,13,408 0.66
At the end of the year 5,13,408 0.66 5,13,408 0.66
7 SBI Arbitrage Opportunities Fund
At the beginning of the year 5,63,819 0.73 5,63,819 0.73
Bought during the year 44,260 0.05 6,08,079 0.78
Sold during the year (1,16,453) (0.15) 4,91,626 0.63
At the end of the year 4,91,626 0.63 4,91,626 0.63
8 Government Of Singapore
At the beginning of the year 6,32,026 0.81 6,32,026 0.81
Bought during the year - - 6,32,026 0.81
Sold during the year (1,41,077) (0.18) 4,90,949 0.63
At the end of the year 4,90,949 0.63 4,90,949 0.63
9 HDFC Life Insurance Company Limited
At the beginning of the year 4,84,893 0.62 4,84,893 0.62
Bought during the year - - 4,84,893 0.62
Sold during the year - - 4,84,893 0.62
At the end of the year 4,84,893 0.62 4,84,893 0.62
10 Franklin Templeton Investment Funds
At the beginning of the year 3,32,388 0.43 3,32,388 0.43
Bought during the year - - 3,32,388 0.43
Sold during the year - - 3,32,388 0.43
At the end of the year 3,32,388 0.43 3,32,388 0.43
Cumulative Shareholding
Shareholding
Sl. during the year
Name of shareholders
No. % of total shares % of total shares of
No. of shares No. of shares
of the Company the Company
11 Aditya Birla Sun Life Trustee Private Limited
At the beginning of the year 7,00,462 0.90 7,00,462 0.90
Bought during the year - - 7,00,462 0.90
Sold during the year (4,79,291) (0.62) 2,21,171 0.28
At the end of the year 2,21,171 0.28 2,21,171 0.28
12 DSP Blackrock Various Mutual Funds
At the beginning of the year 9,63,002 1.24 9,63,002 1.24
Bought during the year - - 9,63,002 1.24
Sold during the year (8,30,378) (1.07) 1,32,624 0.17
At the end of the year 1,32,624 0.17 1,32,624 0.17
Notes:
(1) The above information is based on the weekly beneficiary position received from Depositories.
(2) The date wise increase or decrease in shareholding of the top ten shareholders is available on the website of the Company at www.tatasteel.com
(3) The % of total shares of the Company in respect of shares bought and sold during the year is calculated on the total share capital of the Company as
on March 31, 2019.
V. INDEBTEDNESS
Indebtedness of the Company including interest outstanding/accrued but not due for payment.
(` crore)
Secured Loans Unsecured Total
Deposits
excluding deposits Loans Indebtedness
Indebtedness at the beginning of the financial year
(i) Principal Amount *2,528.86 25,596.94 - 28,125.80
(ii) Interest due but not paid - - - -
(iii) Interest accrued but not due - 556.01 - 556.01
Total (i+ii+iii) 2,528.86 26,152.95 - 28,681.81
Change in Indebtedness during the financial year
• Addition 69.68 **6,310.17 - 6,379.85
• Reduction 26.35 #4,764.48 - 4,790.83
Net Change 43.33 1,545.69 - 1,589.02
Indebtedness at the end of the financial year
(i) Principal Amount *2,572.19 27,129.28 - 29,701.47
(ii) Interest due but not paid - - - -
(iii) Interest accrued but not due - 569.36 - 569.36
Total (i+ii+iii) 2,572.19 27,698.64 - 30,270.83
*includes funded interest on SDF loan of `924.77 crore (31.03.2018: `855.09 crore)
**includes revaluation loss (net) of `59.12 crore on forex loans and amortisation of loan issue and premium and discount expenses aggregating
`204.23 crore under effective interest rate method.
#includes realised exchange loss (net) of `0.69 crore on repayment of forex loans.
185
EXTRACT OF ANNUAL RETURN
sd/- sd/-
T. V. Narendran Parvatheesam K
Chief Executive Officer & Company Secretary &
Mumbai Managing Director Chief Legal Officer (Corporate & Compliance)
April 25, 2019 DIN: 03083605 ACS: 15921
187
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS | PARTICULARS OF ENERGY CONSERVATION, ETC.
ANNEXURE 10
Particulars of Loans, Guarantees or Investments
[Pursuant to Section 186 of the Companies Act, 2013]
Loans, Guarantees given or Investments made during the Financial Year 2018-19
(` crore)
Particulars of Loan, Purpose for which the loans,
Name of the Entity Relation Amount Guarantees given or guarantees and investments are
Investments made proposed to be utilised
Bamnipal Steel Limited 18,631.65*
Subarnarekha Port Private Limited Subsidiary 20.00
Tata Steel Special Economic Zone Limited 13.00
Loan
TRF Limited. Associate 242.00*
S & T Mining Company Private Limited 0.47
Joint Venture
T M Mining Company Limited 0.05#
Creative Port Development Private Limited 91.88
Tata Steel Special Economic Zone Limited 30.50
Jamshedpur Football and Sporting PrivateLimited 12.00
Bhubaneshwar Power Private Limited 23.00
Subsidiary
Jamshedpur Utilities & Services Company Limited 4.00
Investments
Bamnipal Steel Limited 258.88 Business purpose
in Equity Shares
Tata Metaliks Ltd. 179.57
Subarnarekha Port Private Limited 10.01
Jamshedpur Continuous Annealing and Processing
153.00
Company Private Limited Joint Venture
T M Mining Company Limited 0.01
Investments
Tata Metaliks Ltd. 56.05
in Warrants
Tata Steel Holdings Pte Ltd. 8,707.98
Tata Steel BSL Limited Subsidiary 19,700.00 Investments
Creative Port Development Private Limited 25.11 in Preference
Tayo Rolls Limited 3.00 Shares
TRF Limited. Associate 250.00
* Represents loans given and repaid during the year ended March 31, 2019
# Inter-corporate deposits has subsequently been converted into investment in equity shares during the Financial Year 2018-19
Advance against equity as on March 31, 2019
(` crore)
Name of the Entity Relation Amount
Tata Steel Special Economic Zone Limited Subsidiary 275.19
As on March 31, 2019, Company’s loan in Tayo Rolls Limited, Tata Steel (KZN) (Pty) Ltd., S & T Mining Company Private Limited and Sanderson
Industries Ltd. along with investment in Tayo Rolls Limited, Adityapur Toll Bridge Company Limited, Tata Steel Odisha Limited, Jamshedpur
Football and Sporting Private Limited, Strategic Energy Technology Systems Private Limited, T M Mining Company Limited and S & T Mining
Company Private Limited has been fully impaired.
On behalf of the Board of Directors
sd/-
N. CHANDRASEKARAN
Mumbai Chairman
April 25, 2019 DIN: 00121863
ANNEXURE 11
Particulars of Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
[Pursuant to Companies (Accounts) Rules, 2014]
(A) Conservation of Energy • Increase in share of dumped hot metal in granshot from 56%
to 72% thereby reducing hot metal pooling
(i) Steps taken or impact on conservation of energy
Jamshedpur Hot Strip Mill
• Green
Power initiative – successfully commissioned Coke • Reduced mill specific power consumption from 122 KWH to
Dry Quenching Power Plant of 40MW Capacity 118 KWH through:
• New by-product gas fired Boiler of 136 tph ––planned stoppages for longer duration in place of multiple
capacity commissioned shorter durations; and
• Coal firing has permanently stopped at the Works, maximising –– higher pacing during rolling durations
the by-product gas utilisation • Reduced fuel consumption from 0.300 Gcal/t to 0.294
• Best by-product gas utilisation of 98.18% achieved Gcal/t through air fuel ratio optimisation, Level 2 usage for
combustion control and cutting fuel load during delays
• Highest ever by-product gas-based power generation
achieved Sinter Plant
• 1.3 Lakh LED lights installed in the Works • Reduced Water Consumption in Sinter Making in FY 2018-19
to 0.053 m3/ton of Net Sinter (FY 2017-18: 0.08 m3/ton)
• Lowest ever blast furnace gas flaring - 1.9% against the
previous best of 3.16% • Reduced Solid Fuel requirement in Sinter Making in
FY 2018-19 to 78 kg/ton of Net Sinter (FY 2017-18: 83 kg/ton)
• FourVariable Frequency Drives installed for high power
consuming equipment Utilities
• Lowest ever specific water consumption of 3.28 m /tcs, 11%
3 • Electrical power demand met from by-product gases
reduction over Financial Year 2017-18 utilisation - 56.46%
• Coal blend optimisation to The Tata Power Company Limited • By-product gas Utilisation - 93.98%
Jojobera units from captive mines • Gas recovery - 45.11% of heats recovered
• Energy & Electrode consumption optimised in Laddle Furnace • TRT - Top Pressure Recovery Turbine average power
arcing process at LD shops through digital initiative generation 15MW
• Energy Performance Improvement Team (‘EPIT’) formed • Utilisation of LD gas in Coke Oven under firing to improve
to drive Energy Efficiency Campaign across the Indian energy and combustion efficiency
operations, exploiting cross learning and synergy
• Centralised
utility management established for efficient
• Mandatory Energy Audit carried out through an accredited management of all utilities across plant
Audit team as per Energy Conservation Act
• Predictive controller model being used for ASU-Air Separation
Kalinganagar Unit to optimise power and subsequently reduction in
oxygen venting
Blast Furnace
• Increase in Pulverised Coal Injection (‘PCI’) rate (ii)
Steps taken by the Company for utilising alternate
from 119kg/tHM to 150 kg/tHM, thereby reducing sources of energy
coke consumption
Jamshedpur
• Reduced specific water consumption from 0.56 m3/tHM to • Initiatedprojects on power generation from solar and
0.50 m3/tHM by utilising waste water in slag granulation non-conventional energy source. Pilot project on low grade
• Reduced specific power consumption from energy recovery on progress.
141 KWH/tHM to 115 KWH/tHM
Kalinganagar
• Substituted river sand by granulated slag for • Increased solid waste consumption in sinter making
trough preparation
189
PARTICULARS OF ENERGY CONSERVATION, ETC.
(ii) Process Improvement: process efficiency. 5 flow meters & 3 density meters installed
till March 2019. Remaining measurement systems to be
Jamshedpur
installed & commissioned by May 2019.
Mining:
• Reducing misplacement of clean coal in Dense Media Cyclones
• Establishing application of GPS based advanced portable tool (‘DMCs’) by installation of real time monitoring system: An
to measure haul road parameters (gradient, curve radius, super order has been placed on Commonwealth Scientific and
elevation & rolling resistance) at Quarry - AB, West Bokaro. Industrial Research Organisation (Australia) through minor
This will help to identify haul road problems, determine capital scheme for procurement & installation of Electrical
severity and allocate maintenance resources accordingly to Impedance Spectrometer in 1 stream of DMCs (out of 4).
improve haul road conditions thereby reducing haul truck Installation to be completed by August 2019. Based on the
fuel consumption and increasing the tyre life. results, a decision for replication in the remaining streams
• Augmenting coal extraction ratio by increasing the backfilling would be taken.
rate at Bhelatand Colliery. Backfilling rate increased by ~24% • Integration of Intermediate size beneficiation circuit at
by installing fish tale arrangement for homogenous mixing of Washery#3: Through detailed lab & pilot scale studies, it has
water and sand. been established that introduction of an intermediate circuit
• Site selection & prefeasibility study for underground coal – Reflux Classifier for beneficiation of 0.5-0.15mm would
gasification at Jamadoba for unlocking value from remaining result in clean coal yield gain by ~3-4%. A detailed project
coal resource (~200MT) which is unviable through current report consisting of preliminary engineering for the modified
method of mining. All related baseline information/data circuit, piping and instrumentation, equipment selection,
is collated, Test bore hole drilling has been completed, specifications and general arrangement, project execution
hydro-geological & rock mechanics study is in progress. cost & duration prepared for approval & implementation.
191
PARTICULARS OF ENERGY CONSERVATION, ETC.
Coal coke: • Predictive control for Total Dissolved Solid and Chemical
• Plastic trial at CP1 has established that
0.1% plastic in the Oxygen Demand of By-Product Plant waste water which helped
blend can be used without affecting coke quality in better control of Biological Oxygen Treatment process.
• Reduction of lime consumption in SMS from 75.36 kg/tcs in • Bake hardening steel development through Jamshedpur
Financial Year 2017-18 to 70.7 kg/tcs in Financial Year 2018-19
• Continuous Annealing & Processing Company Private Limited
Hot Strip Mill for automotive Commercial Vehicle segment
• Roughing Mill speed optimised through benchmarking with • Development of Eco-friendly passivation for Galvano to
Jamshedpur and Tata Steel BSL Limited (‘TSBSL’) eliminate pre-treatment process at Customer end
• Achieved better product properties through usage of lesser • HC 80A with improved torsion properties to meet
number of Finishing Mill stands (Use of 5 stands instead of 7 Customer demand
stands) for thicker sections
• Gr 3[Staple] for high speed wire drawing were to supply
• Installed Laminar water header before Finishing Mill to avoid to niche Customer
rescaling and hence Rolled in Scale defect
• WR3M for high speed wire drawing increased
• Extra-to-order tonnage reduced by 80% because of width productivity by 30%
deviation by set up optimisation using advance analytics.
• HC82BCr[LR] for single Low Relaxation Prestressed Concrete
• Slab and Coil image identification mechanism for wire – Entry into new segment
avoiding Rank-A defect
• Fe 550D rebars with higher ductility
• Improve product yield by avoiding discarding prime material • Fe 600 rebars with higher strength and ductility
through usage of High resolution movable camera for
detecting defects at offline inspection station Kalinganagar
(iii) Product Development • Volume Ramp up of all Automotive grades including critical
grades such as HS800 @4kt/month, TPI Grades @ 8kt
Jamshedpur
• Tata Shakti, Tata Kosh and Tata Steelium launched and now, it • Development of Automotive Grades such as IF, FB780,
JSH590BN, DP780, DP980, SPFH590 & HS1000 to improve Tata
will be commercialised through TSBSL
Steel’s share of business in growing Automotive markets
• Ford Global Approval for Galvanised automotive application.
2. Benefits derived from key projects:
Project title Benefits derived
Jamshedpur
Roughing mill window expansion for Skin panel rolling in HSM 8000 tonnes extra skin panel volume. Saving potential ~ 41 crore/annum
Increase in rolling speed of 10, 12 and 16 mm rebar. One of the enabler
Improvement of productivity of New Bar Mill (‘NBM’) by to pave a way to cross the ABP target of NBM and reach the milestone
optimising water-box cooling using first principle-based model
of 1.037 MT in Financial Year 2018-19.
Improve the consistency in microstructure in high end High Reduction in customer complaints and increase in productivity
Carbon wire rods at customer end.
Successful Trial of HPPI grate bars >1 crore/annum (potential)
Aluminum control prediction model (‘ACPM’) for bath chemistry Improvement in quality of galvanised automotive products from
based on mill signal Continuous Galvanizing Line #2
Kalinganagar
Development of customised wagon builder led to 24% reduction in rail
Reduction in rail idle freight in Outbound logistics
idle weight through optimised loading of coils in wagons
Implementation of slag detection system in convertor and caster led to
Reduction of HM+Scrap in SMS
reduction in HM+Scrap by 6 kg/tcs
Increase in maximum casting speed of peritectic grades with
Improvement in casting speed of SMS Caster development of high speed casting powder led to increase in
throughput of SMS
Improvement in PCI rate at BF TSK from 150kg/tHM to
PCI mill availability increased to 92% in Financial Year 2018-19 as
175 kg/tHM inFinancial Year 2018-19 by compared to baseline of 85%. Due to this, PCI injection level increased
debottlenecking PCI circuit.
Reduction of fuel rate at Blast furnace from 555kg/tHM to Fuel rate improved from the baseline level of 555 kg/tHM in H1
540 kg/tHM using advance analytics Financial Year 2018-19 to 540 kg/tHM
193
PARTICULARS OF ENERGY CONSERVATION, ETC.
sd/-
N. CHANDRASEKARAN
Mumbai Chairman
April 25, 2019 DIN: 00121863
FINANCIAL HIGHLIGHTS
(` crore)
195
STANDALONE
FINANCIAL RATIOS
PRODUCTION STATISTICS
’000 Tonnes
Iron Coal Iron Crude Rolled/ Plates Sheets Hot Cold Railway Semi- Total
Ore steel Forged Bars Rolled Rolled Materials Finished Saleable
Year and Coils/ Coils for Sale Steel
Structurals Strips
1989-90 3,726 3,754 2,268 2,323 553 91 117 155 - 17 1,033 1,913
1990-91 3,509 3,725 2,320 2,294 558 88 118 153 - 14 1,013 1,901
1991-92 3,996 3,848 2,400 2,415 599 92 123 170 - 9 1,045 1,978
1992-93 4,126 3,739 2,435 2,477 575 78 122 163 - 7 1,179 2,084
1993-94 4,201 3,922 2,598 2,487 561 - 124 281 - 6 1,182 2,117
1994-95 4,796 4,156 2,925 2,788 620 - 137 613 - 2 1,074 2,391
1995-96 5,181 4,897 3,241 3,019 629 - 133 1,070 - - 869 2,660
1996-97 5,766 5,294 3,440 3,106 666 - 114 1,228 - - 811 2,783
1997-98 5,984 5,226 3,513 3,226 634 0 60 1,210 0 0 1,105 2,971
1998-99 6,056 5,137 3,626 3,264 622 0 0 1,653 0 0 835 3,051
1999-00 6,456 5,155 3,888 3,434 615 0 0 2,057 0 0 615 3,262
2000-01 6,989 5,282 3,929 3,566 569 0 0 1,858 356 0 647 3,413
2001-02 7,335 5,636 4,041 3,749 680 0 0 1,656 734 0 566 3,596
2002-03 7,985 5,915 4,437 4,098 705 0 0 1,563 1,110 0 563 3,975
2003-04 8,445 5,842 4,466 4,224 694 0 0 1,578 1,262 0 555 4,076
2004-05 9,803 6,375 4,347 4,104 706 0 0 1,354 1,445 0 604 4,074
2005-06 10,834 6,521 5,177 4,731 821 0 0 1,556 1,495 0 679 4,551
2006-07 9,776 7,041 5,552 5,046 1,230 0 0 1,670 1,523 0 506 4,929
2007-08 10,022 7,209 5,507 5,014 1,241 0 0 1,697 1,534 0 386 4,858
2008-09 10,417 7,282 6,254 5,646 1,350 0 0 1,745 1,447 0 833 5,375
2009-10 12,044 7,210 7,231 6,564 1,432 0 0 2,023 1,564 0 1,421 6,439
2010-11 13,087 7,024 7,503 6,855 1,486 0 0 2,127 1,544 0 1,534 6,691
2011-12 13,189 7,460 7,750 7,132 1,577 0 0 2,327 1,550 0 1,514 6,970
2012-13 15,005 7,295 8,858 8,130 1,638 0 0 3,341 1,445 0 1,518 7,941
2013-14 17,364 6,972 9,899 9,155 1,676 0 0 4,271 1,638 0 1,346 8,931
2014-15 13,694 6,044 10,163 9,331 1,778 0 0 4,259 1,836 0 1,200 9,073
2015-16 16,431 6,227 10,655 9,960 1,823 0 0 4,742 1,689 0 1,443 9,698
2016-17 21,284 6,315 13,051 11,683 1,882 0 0 6,295 1,837 0 1,481 11,351
2017-18 23,043 6,224 13,855 12,482 1,882 0 0 7,093 1,853 0 1,481 12,237
2018-19 23,374 6,546 14,237 13,228 1,959 0 0 7,801 1,858 0 1,386 12,980
FINANCIAL STATISTICS
(` crore)
Capital Reserves Borrow- Gross Net Invest- Total Total Depre- Profit Tax Profit Dividend#
Year and ings Block Block ments Income Expen- ciation before after
Surplus diture c Tax Tax
2016-17 3,246.42 48,687.59 28,284.63 87,987.34 78,731.11 13,665.71 53,675.42 44,776.94 3,541.55 5,356.93 1,912.38 3,444.55 924.71
2017-18 3,421.14 60,368.70 28,125.80 90,354.85 77,402.35 24,276.93 61,283.03 50,917.32 3,727.46 6,638.25 2,468.70 4,169.55 1,159.63
2018-19 3,421.12 69,308.59 29,701.47 93,762.15 77,018.31 39,406.72 73,016.00 52,985.79 3,802.96 16,227.25 5,694.06 10,533.19 1,370.78
c Expenditure includes excise duty recovered on sales.
# Includes tax on dividend.
197
STANDALONE
DIVIDEND STATISTICS
Report on the Audit of the Standalone Financial Statements Basis for Opinion
Opinion 3.
We conducted our audit in accordance with the Standards
1.
We have audited the accompanying Standalone Financial on Auditing (SAs) specified under Section 143(10) of the Act.
Statements of Tata Steel Limited (“the Company”), which Our responsibilities under those Standards are further described
comprise the Balance Sheet as at March 31, 2019, the Statement in the Auditor’s Responsibilities for the Audit of the Standalone
of Profit and Loss (including Other Comprehensive Income), the Financial Statements section of our report. We are independent
Statement of Changes in Equity and the Statement of Cash Flows of the Company in accordance with the Code of Ethics issued
for the year then ended, and Notes to the Standalone Financial by the Institute of Chartered Accountants of India together with
Statements, including a summary of significant accounting the ethical requirements that are relevant to our audit of the
policies and other explanatory information (hereinafter referred Standalone Financial Statements under the provisions of the
to as “the Standalone Financial Statements”). Act and the Rules thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements
2. In our opinion and to the best of our information and according and the Code of Ethics. We believe that the audit evidence we
to the explanations given to us, the aforesaid Standalone have obtained is sufficient and appropriate to provide a basis
Financial Statements give the information required by the for our opinion.
Companies Act, 2013 (“the Act”) in the manner so required
and give a true and fair view in conformity with the accounting
principles generally accepted in India, of the state of affairs of
the Company as at March 31, 2019, its total comprehensive
income (comprising of profit and other comprehensive income),
its changes in equity and its cash flows for the year then ended.
199
STANDALONE
Key Audit Matter How our audit addressed the Key Audit Matter
Assessment of litigations and related disclosure of Our audit procedures included the following:
contingent liabilities
• We understood, assessed and tested the design and operating
[Refer to Note 2 (c) to the Standalone Financial Statements– “Use effectiveness of key controls surrounding assessment of
of estimates and critical accounting judgements – Provisions and litigations relating to the relevant laws and regulations;
contingent liabilities”, Note 36 (A) to the Standalone Financial
Statements – “Contingencies” and Note 37 to the Standalone
• We discussed with management the recent developments and
the status of the material litigations which were reviewed and
Financial Statements – “Other significant litigations”]
noted by the audit committee;
As at March 31, 2019, the Company has exposures towards
litigations relating to various matters as set out in the
• We performed our assessment on a test basis on the underlying
calculations supporting the contingent liabilities/other
aforesaid Notes.
significant litigations made in the Standalone
Significant management judgement is required to assess such Financial Statements;
matters to determine the probability of occurrence of material
outflow of economic resources and whether a provision should
• We used auditor’s experts to gain an understanding and to
evaluate the disputed tax matters;
be recognised, or a disclosure should be made. The management
judgement is also supported with legal advice in certain cases as • We considered external legal opinions, where relevant,
considered appropriate. obtained by management;
As the ultimate outcome of the matters are uncertain and the • We met with the Company’s external legal counsel to
positions taken by the management are based on the application understand the interpretation of laws/regulations considered
of their best judgement, related legal advice including those by the management in their assessment relating to a
relating to interpretation of laws/regulations, it is considered to be material litigation;
a Key Audit Matter.
• We evaluated management’s assessments by understanding
precedents set in similar cases and assessed the reliability of the
management’s past estimates/judgements;
• We evaluated management’s assessment around those matters
that are not disclosed or not considered as contingent liability, as
the probability of material outflow is considered to be remote by
the management; and
• We assessed the adequacy of the Company’s disclosures.
Based on the above work performed, management’s assessment in
respect of litigations and related disclosures relating to contingent
liabilities/other significant litigations in the Standalone Financial
Statements are considered to be reasonable.
Key Audit Matter How our audit addressed the Key Audit Matter
Assessment of carrying value of equity investments in Our audit procedures included the following:
subsidiaries, associates and joint ventures and fair value of
other investments
• We obtained an understanding from the management, assessed
and tested the design and operating effectiveness of the
[Refer to Note 2 (c) to the Standalone Financial Statements – “Use Company’s key controls over the impairment assessment and
of estimates and critical accounting judgements – Impairment fair valuation of material investments.
and fair value measurements of financial instruments”, Note 2
(m) to the Standalone Financial Statements – “Investments in
• We evaluated the Company’s process regarding impairment
assessment and fair valuation by involving auditor’s valuation
subsidiaries, associates and joint ventures”, Note 2(n)(I) to the
experts to assist in assessing the appropriateness of the valuation
Standalone Financial Statements – “Financial assets”, Note 6 to the
model including the independent assessment of the underlying
Standalone Financial Statements – “Investments in subsidiaries,
assumptions relating to discount rate, terminal value etc.
associates and joint ventures”, Note 7 to the Standalone Financial
Statements – “Investments” and Note 39 (b) to the Standalone • We assessed the carrying value/fair value calculations of
Financial Statements – “Fair value hierarchy”] all individually material investments, where applicable, to
determine whether the valuations performed by the Company
The Company has equity investments in various subsidiaries,
were within an acceptable range determined by us and the
associates, joint ventures and other companies. It also has made
auditor’s valuation experts.
investments in preference shares in certain subsidiaries/associates
and debentures in a joint venture. • We evaluated the cash flow forecasts (with underlying economic
growth rate) by comparing them to the approved budgets and
The Company accounts for equity investments in subsidiaries,
our understanding of the internal and external factors.
associates and joint ventures at cost (subject to impairment
assessment) and other investments at fair value. • We checked the mathematical accuracy of the impairment
model and agreed relevant data back to the latest budgets,
For investments carried at cost where an indication of impairment
actual past results and other supporting documents.
exists, the carrying value of investment is assessed for impairment
and where applicable an impairment provision is recognised, if • We assessed the Company’s sensitivity analysis and evaluated
required, to its recoverable amount. whether any reasonably foreseeable change in assumptions
could lead to impairment or material change in fair valuation.
For investments carried at fair values, a fair valuation is done at the
year-end as required by Ind AS 109. In case of certain investments, • We discussed with the component auditors of certain entities
cost is considered as an appropriate estimate of fair value since to develop an understanding of the operating performance
there is a wide range of possible fair value measurements and and outlook used in their own valuation model and to assess
cost represents the best estimate of fair value within that range as consistency with the assumptions used in the model.
permitted under Ind AS 109.
• We had discussions with management to obtain an
The accounting for investments is a Key Audit Matter as the understanding of the relevant factors in respect of certain
determination of recoverable value for impairment assessment/fair investments carried at fair value where a wide range of fair
valuation involves significant management judgement. values were possible due to various factors such as absence
of recent observable transactions, restrictions on transfer of
The impairment assessment and fair valuation for such
shares, existence of multiple valuation techniques, investee’s
investments have been done by the management in accordance
varied nature of portfolio of investments for which significant
with Ind AS 36 and Ind AS 113 respectively.
estimates/judgements are required to arrive at fair value.
The key inputs and judgements involved in the impairment/fair
valuation assessment of unquoted investments include:
• We evaluated the adequacy of the disclosures made in the
Standalone Financial Statements.
• Forecast cash flows including assumptions on growth rates
Based on the above procedures performed, we did not identify
• Discount rates any significant exceptions in the management’s assessment in
relation to the carrying value of equity investments in subsidiaries,
• Terminal growth rate
associates and joint ventures and fair value of other investments.
Economic and entity specific factors are incorporated in valuation
used in the impairment assessment.
201
STANDALONE
Other Information The Board of Directors is also responsible for overseeing the
5. The Company’s Board of Directors is responsible for the other Company’s financial reporting process.
information. The other information comprises the information
Auditor’s Responsibilities for the Audit of the Standalone
in the Integrated Report, Board’s Report alongwith its Annexures
Financial Statements
and Financial Highlights included in the Company’s Annual
Report (titled as ‘Tata Steel Integrated Report & Annual Accounts 8.
Our objectives are to obtain reasonable assurance about
2018-19’), but does not include the financial statements and our whether the Standalone Financial Statements as a whole are
auditor’s report thereon. free from material misstatement, whether due to fraud or
error, and to issue an auditor’s report that includes our opinion.
Our opinion on the Standalone Financial Statements does not Reasonable assurance is a high level of assurance, but is not a
cover the other information and we do not express any form of guarantee that an audit conducted in accordance with SAs
assurance conclusion thereon. will always detect a material misstatement when it exists.
In connection with our audit of the Standalone Financial Misstatements can arise from fraud or error and are considered
Statements, our responsibility is to read the other information material if, individually or in the aggregate, they could
and, in doing so, consider whether the other information is reasonably be expected to influence the economic decisions
materially inconsistent with the Standalone Financial Statements of users taken on the basis of these Standalone
or our knowledge obtained in the audit or otherwise appears Financial Statements.
to be materially misstated. If, based on the work we have 9.
As part of an audit in accordance with SAs, we exercise
performed, we conclude that there is a material misstatement of professional judgement and maintain professional scepticism
this other information, we are required to report that fact. throughout the audit. We also:
We have nothing to report in this regard. • Identify and assess the risks of material misstatement of the
Standalone Financial Statements, whether due to fraud or
Responsibilities of Management and Those Charged with
error, design and perform audit procedures responsive to
Governance for the Standalone Financial Statements
those risks, and obtain audit evidence that is sufficient and
6. The Company’s Board of Directors is responsible for the matters appropriate to provide a basis for our opinion. The risk of not
stated in Section 134(5) of the Act with respect to the preparation detecting a material misstatement resulting from fraud is
of these Standalone Financial Statements that give a true and fair higher than for one resulting from error, as fraud may involve
view of the financial position, financial performance, changes in collusion, forgery, intentional omissions, misrepresentations,
equity and cash flows of the Company in accordance with the or the override of internal control.
accounting principles generally accepted in India, including
the Accounting Standards specified under Section 133 of the • Obtain an understanding of internal control relevant to the
Act. This responsibility also includes maintenance of adequate audit in order to design audit procedures that are appropriate
accounting records in accordance with the provisions of the Act in the circumstances. Under Section 143(3)(i) of the Act, we
for safeguarding of the assets of the Company and for preventing are also responsible for expressing our opinion on whether
and detecting frauds and other irregularities; selection and the Company has adequate internal financial controls with
application of appropriate accounting policies; making reference to Standalone Financial Statements in place and the
judgements and estimates that are reasonable and prudent; and operating effectiveness of such controls.
design, implementation and maintenance of adequate internal • Evaluate the appropriateness of accounting policies used
financial controls, that were operating effectively for ensuring and the reasonableness of accounting estimates and related
the accuracy and completeness of the accounting records, disclosures made by management.
relevant to the preparation and presentation of the Standalone
Financial Statements that give a true and fair view and are free • Conclude on the appropriateness of management’s use of
from material misstatement, whether due to fraud or error. the going concern basis of accounting and, based on the
audit evidence obtained, whether a material uncertainty
7. In preparing the Standalone Financial Statements, management exists related to events or conditions that may cast significant
is responsible for assessing the Company’s ability to continue as doubt on the Company’s ability to continue as a going
a going concern, disclosing, as applicable, matters related to concern. If we conclude that a material uncertainty exists, we
going concern and using the going concern basis of accounting are required to draw attention in our auditor’s report to the
unless management either intends to liquidate the Company or related disclosures in the Standalone Financial Statements
to cease operations, or has no realistic alternative but to do so. or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up
203
STANDALONE
Referred to in paragraph 14(f) of the Independent Auditor’s system with reference to Standalone Financial Statements and
Report of even date to the members of Tata Steel Limited on their operating effectiveness. Our audit of internal financial
the Standalone Financial Statements as of and for the year controls with reference to Standalone Financial Statements
ended March 31, 2019 included obtaining an understanding of internal financial
controls with reference to Standalone Financial Statements,
Report on the Internal Financial Controls with reference to assessing the risk that a material weakness exists, and testing and
Standalone Financial Statements under Clause (i) of Sub-section evaluating the design and operating effectiveness of internal
3 of Section 143 of the Companies Act, 2013 (“the Act”) control based on the assessed risk. The procedures selected
1. We have audited the internal financial controls with reference depend on the auditor’s judgement, including the assessment
to Standalone Financial Statements of Tata Steel Limited (“the of the risks of material misstatement of the Standalone Financial
Company”) as of March 31, 2019 in conjunction with our audit Statements, whether due to fraud or error.
of the Standalone Financial Statements of the Company for the 5. We believe that the audit evidence we have obtained is sufficient
year ended on that date. and appropriate to provide a basis for our audit opinion on the
Company’s internal financial controls system with reference to
Management’s Responsibility for Internal Financial Controls Standalone Financial Statements.
2. The Company’s management is responsible for establishing
and maintaining internal financial controls based on the Meaning of Internal Financial Controls with reference to
internal control over financial reporting criteria established financial statements
by the Company considering the essential components of 6.
A company’s internal financial controls with reference to
internal control stated in the Guidance Note on Audit of financial statements is a process designed to provide reasonable
Internal Financial Controls Over Financial Reporting issued assurance regarding the reliability of financial reporting and
by the Institute of Chartered Accountants of India (ICAI). the preparation of financial statements for external purposes
These responsibilities include the design, implementation and in accordance with generally accepted accounting principles.
maintenance of adequate internal financial controls that were A company’s internal financial controls with reference to financial
operating effectively for ensuring the orderly and efficient statements includes those policies and procedures that (1)
conduct of its business, including adherence to company’s pertain to the maintenance of records that, in reasonable detail,
policies, the safeguarding of its assets, the prevention and accurately and fairly reflect the transactions and dispositions of
detection of frauds and errors, the accuracy and completeness the assets of the company; (2) provide reasonable assurance that
of the accounting records, and the timely preparation of reliable transactions are recorded as necessary to permit preparation
financial information, as required under the Act. of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures
Auditor’s Responsibility of the company are being made only in accordance with
3. Our responsibility is to express an opinion on the Company’s authorisations of management and directors of the company;
internal financial controls with reference to Standalone and (3) provide reasonable assurance regarding prevention or
Financial Statements based on our audit. We conducted our timely detection of unauthorised acquisition, use or disposition
audit in accordance with the Guidance Note on Audit of Internal of the company’s assets that could have a material effect on the
Financial Controls Over Financial Reporting (the “Guidance financial statements.
Note”) and the Standards on Auditing deemed to be prescribed
under Section 143(10) of the Act to the extent applicable to Inherent Limitations of Internal Financial Controls with
an audit of internal financial controls, both applicable to an reference to financial statements
audit of internal financial controls and both issued by the ICAI. 7. Because of the inherent limitations of internal financial controls
Those Standards and the Guidance Note require that we comply with reference to financial statements, including the possibility
with ethical requirements and plan and perform the audit to of collusion or improper management override of controls,
obtain reasonable assurance about whether adequate internal material misstatements due to error or fraud may occur and not
financial controls with reference to Standalone Financial be detected. Also, projections of any evaluation of the internal
Statements was established and maintained and if such controls financial controls with reference to financial statements to
operated effectively in all material respects. future periods are subject to the risk that the internal financial
controls with reference to financial statements may become
4.
Our audit involves performing procedures to obtain audit inadequate because of changes in conditions or that the degree
evidence about the adequacy of the internal financial controls of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system with reference to Standalone
Financial Statements and such internal financial controls with reference to Standalone Financial Statements were operating effectively
as at March 31, 2019, based on the internal control over financial reporting criteria established by the Company considering the essential
components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the
Institute of Chartered Accountants of India.
Russell I Parera
Place: Mumbai Partner
Date: April 25, 2019 Membership Number 042190
205
STANDALONE
Referred to in paragraph 13 of the Independent Auditor’s Management has a verification programme designed to cover
Report of even date to the members of Tata Steel Limited on the items over a period of three years. The discrepancies noticed
the Standalone Financial Statements as of and for the year on physical verification of inventory as compared to book
ended March 31, 2019 records were not material.
i. (a) The Company is maintaining proper records showing full iii. The Company has granted unsecured loans, to eleven companies
particulars, including quantitative details and situation, covered in the register maintained under Section 189 of the Act.
of fixed assets. The Company has not granted any loans, secured or unsecured,
to firms, Limited Liability Partnerships or other parties covered
(b) The fixed assets are physically verified by the Management
in the register maintained under Section 189 of the Act.
according to a phased programme designed to cover all the
items over a period of three years, which, in our opinion, (a) In respect of the aforesaid loans, the terms and conditions
is reasonable having regard to the size of the Company under which such loans were granted are not prejudicial
and the nature of its assets. Pursuant to the programme, to the Company’s interest except for two inter corporate
a portion of the fixed assets has been physically verified loans aggregating `0.52 crore granted to two joint venture
by the Management during the year and no material companies during the year ended March 31, 2019, with
discrepancies have been noticed on such verification. a maximum amount of `1.12 crore from the aforesaid
joint venture companies outstanding during the year.
(c)
According to the information and explanations given
These companies are under liquidation, and are therefore
to us and the records examined by us, the title deeds
in our opinion prejudicial to the Company’s interests.
of immovable properties, as disclosed in Note 3 on
property, plant and equipment to the Standalone Financial (b) In respect of the aforesaid loans, the schedule of repayment
Statements, are held in the name of the Company, except of principal and payment of interest has been stipulated
for the following: by the Company. Except for amounts aggregating `670.10
crore outstanding as at March 31, 2019 towards principal
(i) title deeds of freehold land with gross and net carrying
and interest from four subsidiary companies and two joint
amount of `60.44 crore and title deeds of buildings
venture companies, the parties are repaying the principal
with gross carrying amount and net carrying amount
amounts, as stipulated, and are also regular in payment of
of `83.48 crore and `74.49 crore respectively, which are
interest as applicable.
held in the name of erstwhile companies which have
subsequently been amalgamated with the Company; (c) In respect of the aforesaid loans, the total amount overdue
for more than ninety days as at March 31, 2019 is `640.58
(ii) title deeds of freehold land with gross and net carrying
crore outstanding from three subsidiary companies
amount of `202.67 crore and title deeds of buildings
and a joint venture company. In such instances, in our
with gross carrying amount and net carrying amount
opinion, reasonable steps, as applicable, have been
of `95.62 crore and `76.91 crore respectively, which
taken by the Company for the recovery of the principal
are not readily available.
amounts and interest.
ii. The physical verification of inventory (excluding stocks with
iv.
In our opinion, and according to the information and
third parties) have been conducted at reasonable intervals by
explanations given to us, the Company has complied with the
the Management during the year. In respect of inventory lying
provisions of Section 185 and 186 of the Act in respect of the
with third parties, these have substantially been confirmed
loans and investments made, and guarantees and security
by them. In respect of inventories of stores and spares, the
provided by it, as applicable.
v. The Company has not accepted any deposits from the public undisputed statutory dues, including employees’ state
within the meaning of Sections 73, 74, 75 and 76 of the Act insurance, sales tax, service tax, duty of customs, duty of
and the Rules framed there under to the extent notified. In our excise, value added tax, cess, and other material statutory
opinion, and according to the information and explanations dues, as applicable, with the appropriate authorities, other
given to us, the Company has complied with the provisions of than arrear dues outstanding for a period of more than six
Sections 73, 74, 75 and 76 or any other relevant provisions of the months as at March 31, 2019 in respect of pension set out
Act and the Rules framed thereunder to the extent notified, with below. We are informed that the Company has applied for
regard to the unclaimed deposits accepted from the public, as exemption from operations of Employees’ State Insurance
applicable. According to the information and explanations given Act at some locations. We are also informed that actions
to us, no order has been passed by the Company Law Board or taken by the authorities at some locations to bring the
National Company Law Tribunal or Reserve Bank of India or any employees of the Company under the Employees’ State
Court or any other Tribunal on the Company in respect of the Insurance Scheme has been contested by the Company and
aforesaid deposits. payment has not been made of the contributions demanded.
The extent of the arrears of statutory dues outstanding as at
vi. Pursuant to the rules made by the Central Government of India,
March 31, 2019, for a period of more than six months from
the Company is required to maintain cost records as specified
the date they became payable are as follows:
under Section 148(1) of the Act in respect of its products.
We have broadly reviewed the same, and are of the opinion that, Name of the Nature of Amount Period to which the Date of
prima facie, the prescribed accounts and records have been statute dues (` crore) amount relates payment
made and maintained. We have not, however, made a detailed
examination of the records with a view to determine whether Coal Mines Pension 29.43 Oct’17 to Sept’18 April 23,
Pension 2019*
they are accurate or complete.
Scheme, 1998
vii. (a) A
ccording to the information and explanations given to *Writ petition filed with High Court of Jharkhand subsequent to the balance
us and the records of the Company examined by us, in our sheet date on April 24, 2019.
opinion, the Company is generally regular in depositing
undisputed statutory dues in respect of provident fund, Also refer Note 42 to the Standalone Financial Statements
income tax, goods and service tax, though there has been regarding management’s assessment on certain matters relating to
a slight delay in a few cases, and is regular in depositing provident fund.
207
STANDALONE
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of goods
and service tax as at March 31, 2019 which have not been deposited on account of any dispute. The particulars of dues of income tax, sales
tax, service tax, duty of customs, duty of excise and value added tax as at March 31, 2019, which have not been deposited on account of a
dispute, are as follows:
Name of the Statute Nature of dues Amount Amount paid Period to which the Forum where the
(net of payments) (` crore) amount relates dispute is pending
(` crore)
Income- tax Act, 1961 Income Tax 1,427.24* 965.00* 1998-1999, 2006-2008, Tribunal
2009-2012, 2013-2014
235.82 100.00 2010-2011, 2014-2015 Commissioner (Appeals)
Customs Act,1962 Customs Duty 3.95 0.07 2002-2003 High Court
79.67 50.00 2005-2008 Commissioner
Central Excise Act,1944 Excise Duty 33.23 0.10 1988-1990, 2003-2009 High Court
1,132.71 57.85 1990-1991, 1992-1997, Tribunal
1998-2017
170.30 111.63 1988-1990, 1994-2002, Commissioner
2003-2004, 2005-2017
0.03 0.01 1998-1999 Joint Commissioner
0.18 - 1985-1987, 1998-1999 Deputy Commissioner
0.85 - 1983-1985 Assistant Commissioner
Sales Tax Laws Sales Tax 33.90 19.22 1983-1984, 1991-1997, High Court
2000-2004, 2008-2009
71.78 6.19 1977-1978, 1980-1981, Tribunal
1983-1985, 1987-1988,
1989-1999, 2000-2002,
2003-2005, 2009-2011,
2013-2017
247.17 7.06 1988-1990, 1991-1992, Commissioner
1993-1994, 2001-2004,
2006-2007, 2008-2009,
2010-2012, 2013-2015
1.91 - 2011-12 Joint Commissioner
28.18 2.47 2002-2003, 2006-2010, Additional Commissioner
2012-2015
63.97 3.01 1975-1976, 1983-1988, Deputy Commissioner
1994-1995, 1997-2009,
2013-2016
61.77 3.40 1973-1974, 1980-1997, Assistant Commissioner
2004-2005, 2008-2009,
2012-2013, 2015-2016
Value Added Tax Laws Value Added Tax 252.84 1.07 1994-1996, 2007-2008, High Court
2012-2016
19.06 1.72 2005-2011, 2012-2016 Tribunal
273.75 0.89 2006-2015, 2016-2017 Commissioner
72.89 8.10 2010-2017 Joint Commissioner
2.61 0.47 2005-2006, 2012-2015 Additional Commissioner
165.39 3.72 2005-2011, 2012-2016 Deputy Commissioner
1.63 0.06 1997-1998, 2005-2006, Assistant Commissioner
2015-2017
*excluding net excess payments/adjustments for the year 2008-2009 aggregating `123.21 crore.
Name of the Statute Nature of dues Amount Amount paid Period to which the Forum where the
(net of payments) (`crore) amount relates dispute is pending
(` crore)
Finance Act,1994 Service Tax 1,286.52 23.34 2004-2016 Tribunal
5.98 0.13 2005-2013, 2014-2017 Commissioner
0.97 - 2009-2010 Deputy Commissioner
The following matters have been decided in favour of the Company although the department has preferred appeal at higher levels:
Name of the Statute Nature of dues Amount Period to which the Forum where the
(net of payments) amount relates dispute is pending
(` crore)
Central Excise Act,1944 Excise Duty 235.48 2004-2005 Supreme Court
16.98 2009-2010, 2013-2014 Tribunal
viii. According to the records of the Company examined by us and disclosed in the Standalone Financial Statements as required
the information and explanations given to us, the Company under Indian Accounting Standard 24, Related Party Disclosures
has not defaulted in repayment of loans or borrowings to specified under Section 133 of the Act.
any financial institution or bank or Government or dues to
xiv. The Company has not made any preferential allotment or private
debenture holders, as applicable, as at the balance sheet date.
placement of shares or fully or partly convertible debentures
ix. The Company has not raised any moneys by way of initial public during the year under review. Accordingly, the provisions of
offer. In our opinion, and according to the information and Clause 3(xiv) of the Order are not applicable to the Company.
explanations given to us, the moneys raised by way of further
xv. The Company has not entered into any non-cash transactions
public offer (including debt instruments) and term loans have
with its directors or persons connected with him.
been applied for the purposes for which they were obtained.
Accordingly, the provisions of Clause 3(xv) of the Order are not
x. During the course of our examination of the books and records applicable to the Company.
of the Company, carried out in accordance with the generally
xvi. The Company is not required to be registered under Section 45-IA
accepted auditing practices in India, and according to the
of the Reserve Bank of India Act, 1934. Accordingly, the provisions
information and explanations given to us, we have neither come
of Clause 3(xvi) of the Order are not applicable to the Company.
across any instance of material fraud by the Company or on
the Company by its officers or employees, noticed or reported
during the year, nor have we been informed of any such case by
the Management. For Price Waterhouse & Co Chartered Accountants LLP
Firm Registration Number: 304026E/ E-300009
xi. The Company has paid/ provided for managerial remuneration
Chartered Accountants
in accordance with the requisite approvals mandated by the
provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, Russell I Parera
2014 are not applicable to it, the provisions of Clause 3(xii) of the
Order are not applicable to the Company. Place: Mumbai Partner
Date: April 25, 2019 Membership Number 042190
xiii. The Company has entered into transactions with related parties
in compliance with the provisions of Sections 177 and 188 of
the Act. The details of related party transactions have been
209
STANDALONE
BALANCE SHEET
as at March 31, 2019
(` crore)
As at As at
Note Page
March 31, 2019 March 31, 2018
Assets
I Non-current assets
(a) Property, plant and equipment 3 227 70,416.82 70,942.90
(b) Capital work-in-progress 5,686.02 5,641.50
(c) Intangible assets 5 231 805.20 786.18
(d) Intangible assets under development 110.27 31.77
(e) Investments in subsidiaries, associates and joint ventures 6 232 4,437.76 3,666.24
(f ) Financial assets
(i) Investments 7 235 34,491.49 5,970.32
(ii) Loans 8 240 231.16 213.50
(iii) Derivative assets 9.05 12.13
(iv) Other financial assets 9 242 310.65 21.21
(g) Non-current tax assets (net) 1,428.38 1,043.84
(h) Other assets 11 246 2,535.98 2,140.84
Total non-current assets 1,20,462.78 90,470.43
II Current assets
(a) Inventories 12 248 11,255.34 11,023.41
(b) Financial assets
(i) Investments 7 235 477.47 14,640.37
(ii) Trade receivables 13 248 1,363.04 1,875.63
(iii) Cash and cash equivalents 14 250 544.85 4,588.89
(iv) Other balances with banks 15 250 173.26 107.85
(v) Loans 8 240 55.92 74.13
(vi) Derivative assets 14.96 30.07
(vii) Other financial assets 9 242 940.76 491.51
(c) Other assets 11 246 2,209.98 1,812.05
Total current assets 17,035.58 34,643.91
Total assets 1,37,498.36 1,25,114.34
Equity and liabilities
III Equity
(a) Equity share capital 16 251 1,146.12 1,146.12
(b) Hybrid perpetual securities 17 254 2,275.00 2,275.00
(c) Other equity 18 254 69,308.59 60,368.72
Total equity 72,729.71 63,789.84
IV Non-current liabilities
(a) Financial liabilities
(i) Borrowings 19 258 26,651.19 24,568.95
(ii) Derivative liabilities 59.82 70.08
(iii) Other financial liabilities 20 261 125.07 19.78
(b) Provisions 21 261 1,918.18 1,961.21
(c) Retirement benefit obligations 22 262 1,430.35 1,247.73
(d) Deferred income 23 263 747.23 1,365.61
(e) Deferred tax liabilities (net) 10 243 7,807.00 6,259.09
(f ) Other liabilities 24 263 436.16 224.71
Total non-current liabilities 39,175.00 35,717.16
V Current liabilities
(a) Financial liabilities
(i) Borrowings 19 258 8.09 669.88
(ii) Trade payables 25 264
(a) Total outstanding dues of micro and small enterprises 149.49 25.48
(b) Total outstanding dues of creditors other than micro and small enterprises 10,820.07 11,217.27
(iii) Derivative liabilities 139.57 16.41
(iv) Other financial liabilities 20 261 6,872.35 6,541.40
(b) Provisions 21 261 778.23 735.28
(c) Retirement benefit obligations 22 262 102.12 90.50
(d) Current tax liabilities (net) 358.14 454.06
(e) Other liabilities 24 263 6,365.59 5,857.06
Total current liabilities 25,593.65 25,607.34
Total equity and liabilities 1,37,498.36 1,25,114.34
Notes forming part of the financial statements 1-46
In terms of our report attached For and on behalf of the Board of Directors
(` crore)
Year ended Year ended
Note Page
March 31, 2019 March 31, 2018
I Revenue from operations 26 264 70,610.92 60,519.37
II Other income 27 265 2,405.08 763.66
III Total income 73,016.00 61,283.03
IV Expenses:
(a) Cost of materials consumed 19,840.29 16,877.63
(b) Purchases of stock-in-trade 1,807.85 647.21
(c) Changes in inventories of finished and semi-finished goods, stock-in-trade and work-in-progress 28 266 (554.33) 545.36
(d) Employee benefits expense 29 266 5,131.06 4,828.85
(e) Finance costs 30 267 2,823.58 2,810.62
(f ) Depreciation and amortisation expense 31 267 3,802.96 3,727.46
(g) Other expenses 32 267 24,622.81 22,178.02
57,474.22 51,615.15
Less: Expenditure (other than interest) transferred to capital and other accounts 799.70 336.66
Total expenses 56,674.52 51,278.49
V Profit before exceptional items and tax (III-IV) 16,341.48 10,004.54
VI Exceptional items: 33 268
(a) Profit/(loss) on sale of non-current investments 262.28 -
(b) Provision for impairment of investments/doubtful advances (12.53) (62.92)
(c) Provision for demands and claims (328.64) (3,213.68)
(d) Employee separation compensation (35.34) (89.69)
Total exceptional items (114.23) (3,366.29)
VII Profit before tax (V+VI) 16,227.25 6,638.25
VIII Tax expense:
(a) Current tax 6,297.11 1,586.78
(b) Deferred tax (603.05) 881.92
Total tax expense 5,694.06 2,468.70
IX Profit for the year (VII-VIII) 10,533.19 4,169.55
X Other comprehensive income/(loss)
A (i) Items that will not be reclassified subsequently to profit and loss
(a) Remeasurement gain/(loss) on post-employment defined benefit plans 5.95 237.63
(b) Fair value changes of investments in equity shares (46.63) (223.00)
(ii) Income tax on items that will not be reclassified subsequently to profit and loss (2.63) (82.24)
B (i) Items that will be reclassified subsequently to profit and loss
(a) Fair value changes of cash flow hedges (10.62) 9.96
(ii) Income tax on items that will be reclassified subsequently to profit and loss 3.71 (3.47)
Total other comprehensive income/(loss) for the year (50.22) (61.12)
XI Total comprehensive income/(loss) for the year (IX+X) 10,482.97 4,108.43
XII Earnings per share 34 269
Basic (`) 90.41 38.57
Diluted (`) 90.40 38.56
XIII Notes forming part of the financial statements 1 - 46
In terms of our report attached For and on behalf of the Board of Directors
211
STANDALONE
(` crore)
Balance as at Changes Balance as at
April 1, 2018 during the year March 31, 2019
1,146.12 0.00* 1,146.12
(` crore)
Balance as at Changes Balance as at
April 1, 2017 during the year March 31, 2018
971.41 174.71 1,146.12
* represents value less than `0.01 crore.
(` crore)
Balance as at Changes Balance as at
April 1, 2017 during the year March 31, 2018
2,275.00 - 2,275.00
C. Other equity
(` crore)
Retained Items of other Other reserves Share application Total
earnings comprehensive (refer note 18C, money pending
(refer note 18A, income page 256) allotment
page 254) (refer note 18B, (refer note 18D,
page 254) page 257)
(` crore)
Retained Items of other Other reserves Share application Total
earnings comprehensive (refer note 18C, money pending
(refer note income page 256 allotment
18A, (refer note 18B, (refer note 18D,
page 254) page 254) page 257)
(i) Dividend paid during the year ended March 31, 2019 is `10.00 per Ordinary Share (face value `10 each, fully paid up) and `2.504 per
Ordinary Share (face value `10, partly paid up `2.504 per share) (March 31, 2018: `10.00 per Ordinary Share of face value `10 each, fully paid up).
(ii) Represents premium received and issue expenses on rights issue of shares during the year ended March 31, 2018.
In terms of our report attached For and on behalf of the Board of Directors
213
STANDALONE
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
A. Cash flows from operating activities:
Profit before tax 16,227.25 6,638.25
Adjustments for:
Depreciation and amortisation expense 3,802.96 3,727.46
Dividend income (96.25) (88.57)
(Gain)/loss on sale of property, plant and equipment including intangible assets 1.42 40.48
(net of loss on assets sold/scrapped/written off )
Exceptional (income)/expenses 114.23 3,366.29
(Gain)/loss on cancellation of forwards, swaps and options (36.95) 79.33
Interest income and income from current investments and guarantees (2,273.30) (788.38)
Finance costs 2,823.58 2,810.62
Exchange (gain)/loss on revaluation of foreign currency loans and swaps (1.27) (88.17)
Other non-cash items (612.79) (588.33)
3,721.63 8,470.73
Operating profit before changes in non-current/current assets and liabilities 19,948.88 15,108.98
Adjustments for:
Non-current/current financial and other assets (611.22) 456.70
Inventories (214.60) (784.63)
Non-current/current financial and other liabilities/provisions 602.59 (487.09)
(223.23) (815.02)
Cash generated from operations 19,725.65 14,293.96
Income taxes paid (4,532.54) (2,502.51)
Net cash from/(used in) operating activities 15,193.11 11,791.45
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
C. Cash flows from financing activities:
Proceeds from issue of equity shares (net of issue expenses (ii)) (6.03) 9,087.23
Proceeds from borrowings 5,884.67 2,343.84
Repayment of borrowings (4,448.06) (2,850.24)
Repayment of finance lease obligations (89.25) (108.14)
Amount received/(paid) on utilisation/cancellation of derivatives 15.55 (110.72)
Distribution on hybrid perpetual securities (265.39) (267.10)
Interest paid (2,607.88) (2,769.66)
Dividend paid (1,145.92) (971.22)
Tax on dividend paid (224.86) (188.41)
Net cash from/(used in) financing activities (2,887.17) 4,165.58
Net increase/(decrease) in cash and cash equivalents (4,044.04) 3,683.68
Opening cash and cash equivalents (refer note 14, page 250) 4,588.89 905.21
Closing cash and cash equivalents (refer note 14, page 250) 544.85 4,588.89
(i) Includes investments in preference shares `28,686.09 crore (2017-18: `4,646.55 crore).
(ii) During the year ended March 31, 2018, expenses incurred in connection with Rights Issue, 2018 was partly paid by the Company and was
pending adjustment against actual utilisation from the issue proceeds. The same has been fully utilised during the year.
(iii) Significant non-cash movements in borrowings during the year include:
(a) amortisation/effective interest rate adjustments of upfront fees `204.23 crore (2017-18: `206.88 crore).
(b) exchange loss `59.12 crore (2017-18: loss `149.90 crore).
(c) adjustments to finance leases obligations, decrease `34.35 crore (2017-18: increase `110.37 crore).
In terms of our report attached For and on behalf of the Board of Directors
215
STANDALONE
NOTES
forming part of the financial statements
1. Company information carrying value of assets and liabilities that are not readily
Tata Steel Limited (“the Company”) is a public limited Company apparent from other sources. The estimates and associated
incorporated in India with its registered office in Mumbai, assumptions are based on historical experience and other
Maharashtra, India. The Company is listed on the BSE Limited factors that are considered to be relevant. Actual results may
(BSE) and the National Stock Exchange of India Limited (NSE). differ from these estimates.
The Company has presence across the entire value chain of steel Estimates and underlying assumptions are reviewed on an
manufacturing from mining and processing iron ore and coal ongoing basis. Revisions to accounting estimates are recognised
to producing and distributing finished products. The Company in the period in which the estimate is revised and future
offers a broad range of steel products including a portfolio of periods affected.
high value added downstream products such as hot rolled, cold Key source of estimation of uncertainty at the date of the
rolled, coated steel, rebars, wire rods, tubes and wires. financial statements, which may cause material adjustment
The functional and presentation currency of the Company is to the carrying amounts of assets and liabilities within the
Indian Rupee (“`”) which is the currency of the primary economic next financial year, is in respect of impairment, useful lives of
environment in which the Company operates. property, plant and equipment and intangible assets, valuation
of deferred tax assets, provisions and contingent liabilities, fair
As on March 31, 2019, Tata Sons Private Limited owns 31.64 % value measurements of financial instruments and retirement
of the Ordinary Shares of the Company, and has the ability to benefit obligations as discussed below.
influence the Company’s operations.
Impairment
The financial statements for the year ended March 31, 2019 were
approved by the Board of Directors and authorised for issue on The Company estimates the value in use of the cash generating
April 25, 2019. unit (CGU) based on future cash flows after considering current
economic conditions and trends, estimated future operating
2. Significant accounting policies results and growth rates and anticipated future economic and
regulatory conditions. The estimated cash flows are developed
The significant accounting policies applied by the Company
using internal forecasts. The cash flows are discounted using a
in the preparation of its financial statements are listed below.
suitable discount rate in order to calculate the present value.
Such accounting policies have been applied consistently to
Further details of the Company’s impairment review and key
all the periods presented in these financial statements, unless
assumptions are set out in note 3, page 227, note 5, page 231and
otherwise indicated.
note 6, page 232.
(a) Statement of compliance
Useful lives of property, plant and equipment and
The financial statements have been prepared in accordance intangible assets
with the Indian Accounting Standards (referred to as “Ind
The Company reviews the useful life of property, plant and
AS”) prescribed under Section 133 of the Companies Act,
equipment and intangible assets at the end of each reporting
2013 read with Companies (Indian Accounting Standards)
period. This reassessment may result in change in depreciation
Rules, as amended from time to time and other relevant
and amortisation expense in future periods. The policy has been
provisions of the Act.
detailed in note 2(i), page 218.
(b) Basis of preparation
Valuation of deferred tax assets
The financial statements have been prepared under the historical
The Company reviews the carrying amount of deferred
cost convention with the exception of certain assets and
tax assets at the end of each reporting period.
liabilities that are required to be carried at fair value by Ind AS.
The policy has been detailed in note 2 (u), page 224
Fair value is the price that would be received to sell an asset and its further information are set out in note 10, page 243.
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. Provisions and contingent liabilities
A provision is recognised when the Company has a present
(c) Use of estimates and critical accounting judgements
obligation as result of a past event and it is probable
In the preparation of the financial statements, the Company that the outflow of resources will be required to settle
makes judgements, estimates and assumptions about the the obligation, in respect of which a reliable estimate
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) incurred to bring the asset to its working condition and location
for its intended use. Trial run expenses (net of revenue) are
can be made. These are reviewed at each balance sheet
capitalised. Borrowing costs incurred during the period of
date and adjusted to reflect the current best estimates.
construction is capitalised as part of cost of qualifying asset.
Contingent liabilities are not recognised in the financial
statements. Further details are set out in note 21, page 261 and The gain or loss arising on disposal of an item of property, plant
note 36A, page 276. and equipment is determined as the difference between sale
proceeds and carrying value of such item, and is recognised in
Fair value measurements of financial instruments the statement of profit and loss.
When the fair value of financial assets and financial liabilities
recorded in the balance sheet cannot be measured based on (e) Exploration for and evaluation of mineral resources
quoted prices in active markets, their fair value is measured
Expenditures associated with search for specific mineral
using valuation techniques including Discounted Cash Flow resources are recognised as exploration and evaluation assets.
Model. The inputs to these models are taken from observable The following expenditure comprises cost of exploration and
markets where possible, but where this is not feasible, a evaluation assets:
degree of judgement is required in establishing fair value.
Judgements include considerations of inputs such as liquidity
• obtaining of the rights to explore and evaluate mineral
reserves and resources including costs directly related to
risks, credit risks and volatility. Changes in assumptions about
this acquisition
these factors could affect the reported fair value of financial
instruments. Further details are set out in note 39, page 281. • researching and analysing existing exploration data
Retirement benefit obligations • conducting geological studies, exploratory
drilling and sampling
The Company’s retirement benefit obligations are subject to
number of judgements including discount rates, inflation and • examining and testing extraction and treatment methods
salary growth. Significant judgements are required when setting
these criteria and a change in these assumptions would have a
• compiling pre-feasibility and feasibility studies
significant impact on the amount recorded in the Company’s • activities in relation to evaluating the technical feasibility and
balance sheet and the statement of profit and loss. The Company commercial viability of extracting a mineral resource
sets these judgements based on previous experience and
Administration and other overhead costs are charged to the cost
third party actuarial advice. Further details on the Company’s
of exploration and evaluation assets only if directly related to an
retirement benefit obligations, including key judgements are
exploration and evaluation project.
set out in note 35, page 269.
If a project does not prove viable, all irrecoverable exploration
(d) Property, plant and equipment and evaluation expenditure associated with the project net
An item of property, plant and equipment is recognised as an asset of any related impairment allowances is written off to the
if it is probable that future economic benefits associated with statement of profit and loss.
the item will flow to the Company and its cost can be measured
The Company measures its exploration and evaluation assets
reliably. This recognition principle is applied to costs incurred
at cost and classifies as property, plant and equipment or
initially to acquire an item of property, plant and equipment and
intangible assets according to the nature of the assets acquired
also to costs incurred subsequently to add to, replace part of,
and applies the classification consistently. To the extent that a
or service it. All other repair and maintenance costs, including
tangible asset is consumed in developing an intangible asset,
regular servicing, are recognised in the statement of profit and
the amount reflecting that consumption is capitalised as a part
loss as incurred. When a replacement occurs, the carrying value
of the cost of the intangible asset.
of the replaced part is de-recognised. Where an item of property,
plant and equipment comprises major components having
As the asset is not available for use, it is not depreciated.
different useful lives, these components are accounted for as All exploration and evaluation assets are monitored for
separate items. indications of impairment. An exploration and evaluation asset
is no longer classified as such when the technical feasibility
Property, plant and equipment is stated at cost or deemed cost
and commercial viability of extracting a mineral resource are
applied on transition to Ind AS, less accumulated depreciation
demonstrable and the development of the deposit is sanctioned
and impairment. Cost includes all direct costs and expenditures
217
STANDALONE
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) Company. In this case they are measured initially at purchase
cost and then amortised on a straight-line basis over their
by the management. The carrying value of such exploration and estimated useful lives. All other costs on patents, trademarks
evaluation asset is reclassified to mining assets. and software are expensed in the statement of profit and loss as
and when incurred.
(f) Development expenditure for mineral reserves
Expenditure on research activities is recognised as an expense
Development is the establishment of access to mineral
in the period in which it is incurred. Costs incurred on individual
reserves and other preparations for commercial
development projects are recognised as intangible assets from
production. Development activities often continue during
the date when all of the following conditions are met:
production and include:
(i) completion of the development is technically feasible.
• sinkingshafts and underground drifts (often called
mine development) (ii) it is the intention to complete the intangible asset and
use or sell it.
• making permanent excavations
(iii) ability to use or sell the intangible asset.
• developing passageways and rooms or galleries
(iv) it is clear that the intangible asset will generate probable
• building roads and tunnels and future economic benefits.
• advance removal of overburden and waste rock (v)
adequate technical, financial and other resources to
Development (or construction) also includes the installation complete the development and to use or sell the intangible
of infrastructure (e.g., roads, utilities and housing), machinery, asset are available.
equipment and facilities.
(vi)
it is possible to reliably measure the expenditure
Development expenditure is capitalised and presented as part of attributable to the intangible asset during its development.
mining assets. No depreciation is charged on the development
Recognition of costs as an asset is ceased when the project is
expenditure before the start of commercial production.
complete and available for its intended use, or if these criteria
(g) Provision for restoration and environmental costs are no longer applicable.
The Company has liabilities related to restoration of soil and Where development activities do not meet the conditions for
other related works, which are due upon the closure of certain recognition as an asset, any associated expenditure is treated as
of its mining sites. an expense in the period in which it is incurred.
Such liabilities are estimated case-by-case based on available
Subsequent to initial recognition, intangible assets with
information, taking into account applicable local legal definite useful lives are reported at cost or deemed cost applied
requirements. The estimation is made using existing technology, on transition to Ind AS, less accumulated amortisation and
at current prices, and discounted using an appropriate discount accumulated impairment losses.
rate where the effect of time value of money is material.
Future restoration and environmental costs, discounted to (i) Depreciation and amortisation of property, plant and
net present value, are capitalised and the corresponding equipment and intangible assets
restoration liability is raised as soon as the obligation to incur Depreciation or amortisation is provided so as to write off, on
such costs arises. Future restoration and environmental costs are a straight-line basis, the cost/deemed cost of property, plant
capitalised in property, plant and equipment or mining assets and equipment and intangible assets, including those held
as appropriate and are depreciated over the life of the related under finance leases to their residual value. These charges
asset. The effect of time value of money on the restoration and are commenced from the dates the assets are available for
environmental costs liability is recognised in the statement of their intended use and are spread over their estimated useful
profit and loss. economic lives or, in the case of leased assets, over the lease
period, if shorter. The estimated useful lives of assets, residual
(h) Intangible assets values and depreciation method are reviewed regularly and,
Patents, trademarks and software costs are included in the when necessary, revised.
balance sheet as intangible assets when it is probable that
associated future economic benefits would flow to the
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset for which
Depreciation on assets under construction commences only the estimates of future cash flows have not been adjusted.
when the assets are ready for their intended use. An impairment loss is recognised in the statement of profit
and loss as and when the carrying value of an asset exceeds its
The estimated useful lives for main categories of property, plant
recoverable amount.
and equipment and intangible assets are:
Where an impairment loss subsequently reverses, the carrying
Estimated useful value of the asset (or cash generating unit) is increased to the
life (years)
revised estimate of its recoverable amount so that the increased
Buildings upto 60 years* carrying value does not exceed the carrying value that would
Roads 5 years have been determined had no impairment loss been recognised
Plant and machinery upto 40 years* for the asset (or cash generating unit) in prior years. A reversal of
Railway sidings upto 35 years* an impairment loss is recognised in the statement of profit and
Vehicles and aircraft 5 to 20 years loss immediately.
Furniture, fixtures and office equipments 4 to 6 years
Computer software 5 years (k) Leases
Assets covered under Electricity Act (life as 3 to 34 years The Company determines whether an arrangement contains
prescribed under the Electricity Act)
a lease by assessing whether the fulfilment of a transaction
Mining assets are amortised over the useful life of the mine or is dependent on the use of a specific asset and whether the
lease period whichever is lower. transaction conveys the right to use that asset to the Company
in return for payment. Where this occurs, the arrangement is
Major furnace relining expenses are depreciated over a period of deemed to include a lease and is accounted for either as finance
10 years (average expected life). or an operating lease.
Freehold land is not depreciated. Leases are classified as finance leases where the terms of the
Assets value upto `25,000 are fully depreciated in the year lease transfer substantially all the risks and rewards of ownership
of acquisition. to the lessee. All other leases are classified as operating leases.
*For these class of assets, based on internal assessment and The Company as lessee
independent technical evaluation carried out by chartered (i) Operating lease – Rentals payable under operating leases are
engineers, the Company believes that the useful lives as given charged to the statement of profit and loss on a straight-line
above best represents the period over which the Company basis over the term of the relevant lease unless another
expects to use these assets. Hence the useful lives for these systematic basis is more representative of the time pattern in
assets are different from the useful lives as prescribed under Part which economic benefits from the leased assets are consumed.
C of Schedule II of the Companies Act, 2013. Contingent rentals arising under operating leases are recognised
as an expense in the period in which they are incurred.
(j) Impairment
At each balance sheet date, the Company reviews the carrying In the event that lease incentives are received to enter into
value of its property, plant and equipment and intangible operating leases, such incentives are recognised as a liability.
assets to determine whether there is any indication that the The aggregate benefit of incentives is recognised as a reduction
carrying value of those assets may not be recoverable through of rental expense on a straight-line basis, except where another
continuing use. If any such indication exists, the recoverable systematic basis is more representative of the time pattern in
amount of the asset is reviewed in order to determine the extent which economic benefits from the leased asset are consumed.
of impairment loss, if any. Where the asset does not generate (ii) Finance lease – Finance leases are capitalised at the
cash flows that are independent from other assets, the Company commencement of lease, at the lower of fair value of the
estimates the recoverable amount of the cash generating unit to asset or the present value of the minimum lease payments.
which the asset belongs. The corresponding liability to the lessor is included in the
Recoverable amount is the higher of fair value less costs to sell balance sheet as a finance lease obligation. Lease payments
and value in use. In assessing value in use, the estimated future are apportioned between finance charges and reduction of
cash flows are discounted to their present value using a pre-tax the lease obligation so as to achieve a constant rate of interest
219
STANDALONE
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) • mining of the second and subsequent pits is conducted
consecutively with that of the first pit, rather than concurrently
on the remaining balance of the liability. Finance charges
are recognised in the statement of profit and loss over the
• separate investment decisions are made to develop
each pit, rather than a single investment decision being
period of the lease.
made at the outset
The Company as lessor • the pits are operated as separate units in terms of mine
(i)
Operating lease – Rental income from operating leases is planning and the sequencing of overburden and ore mining,
recognised in the statement of profit and loss on a straight-line rather than as an integrated unit
basis over the term of the relevant lease unless another
systematic basis is more representative of the time pattern in
• expenditures for additional infrastructure to support the
second and subsequent pits are relatively large
which economic benefits from the leased asset is diminished.
Initial direct costs incurred in negotiating and arranging an • the pits extract ore from separate and distinct ore bodies,
operating lease are added to the carrying value of the leased rather than from a single ore body.
asset and recognised on a straight-line basis over the lease term.
The relative importance of each factor is considered by the
(ii) Finance lease –When assets are leased out under a finance lease, management to determine whether, the stripping costs should
the present value of minimum lease payments is recognised as a be attributed to the individual pit or to the combined output
receivable. The difference between the gross receivable and the from the several pits.
present value of receivable is recognised as unearned finance
Production stripping costs are incurred to extract the ore in the
income. Lease income is recognised over the term of the lease
form of inventories and/or to improve access to an additional
using the net investment method before tax, which reflects a
component of an ore body or deeper levels of material.
constant periodic rate of return.
Production stripping costs are accounted for as inventories
(l) Stripping costs to the extent the benefit from production stripping activity is
realised in the form of inventories.
The Company separates two different types of stripping costs
that are incurred in surface mining activity: The Company recognises a stripping activity asset in the
production phase if, and only if, all of the following are met:
• developmental stripping costs and
• production stripping costs • itis probable that the future economic benefit (improved
access to the ore body) associated with the stripping activity
Developmental stripping costs which are incurred in order will flow to the Company
to obtain access to quantities of mineral reserves that will be
mined in future periods are capitalised as part of mining assets.
• the entity can identify the component of the ore body for
which access has been improved and
Capitalisation of developmental stripping costs ends when the
commercial production of the mineral reserves begins. • the costs relating to the improved access to that component
can be measured reliably.
A mine can operate several open pits that are regarded
as separate operations for the purpose of mine planning
Such costs are presented within mining assets.
and production. In this case, stripping costs are accounted After initial recognition, stripping activity assets are carried
for separately, by reference to the ore extracted from each at cost/deemed cost less accumulated amortisation and
separate pit. If, however, the pits are highly integrated for the impairment. The expected useful life of the identified
purpose of mine planning and production, stripping costs are component of the ore body is used to depreciate or amortise
aggregated too. the stripping asset.
The determination of whether multiple pit mines are considered (m) Investments in subsidiaries, associates and joint ventures
separate or integrated operations depends on each mine’s
Investments in subsidiaries, associates and joint ventures are
specific circumstances. The following factors normally point
carried at cost/deemed cost applied on transition to Ind AS,
towards the stripping costs for the individual pits being
less accumulated impairment losses, if any. Where an indication
accounted for separately:
of impairment exists, the carrying amount of investment is
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
assessed and an impairment provision is recognised, if required
immediately to its recoverable amount. On disposal of such Financial assets measured at fair value
investments, difference between the net disposal proceeds and
Financial assets are measured at fair value through other
carrying amount is recognised in the statement of profit and loss. comprehensive income if such financial assets are held within
a business model whose objective is to hold these assets in
(n) Financial instruments order to collect contractual cash flows or to sell such financial
Financial assets and financial liabilities are recognised when the assets and the contractual terms of the financial asset give rise
Company becomes a party to the contractual provisions of the on specified dates to cash flows that are solely payments of
instrument. Financial assets and liabilities are initially measured principal and interest on the principal amount outstanding.
at fair value. Transaction costs that are directly attributable to
The Company in respect of equity investments (other than in
the acquisition or issue of financial assets and financial liabilities
subsidiaries, associates and joint ventures) which are not held
(other than financial assets and financial liabilities at fair value
for trading has made an irrevocable election to present in other
through profit and loss) are added to or deducted from the
comprehensive income subsequent changes in the fair value
fair value measured on initial recognition of financial asset or
of such equity instruments. Such an election is made by the
financial liability. The transaction costs directly attributable to
Company on an instrument by instrument basis at the time of
the acquisition of financial assets and financial liabilities at fair
initial recognition of such equity investments. These investments
value through profit and loss are immediately recognised in the
are held for medium or long-term strategic purpose.
statement of profit and loss.
The Company has chosen to designate these investments in
Effective interest method equity instruments as fair value through other comprehensive
income as the management believes this provides a more
The effective interest method is a method of calculating the
meaningful presentation for medium or long-term strategic
amortised cost of a financial instrument and of allocating interest
investments, than reflecting changes in fair value immediately
income or expense over the relevant period. The effective
in the statement of profit and loss.
interest rate is the rate that exactly discounts future cash
receipts or payments through the expected life of the financial Financial assets not measured at amortised cost or at fair value
instrument, or where appropriate, a shorter period. through other comprehensive income are carried at fair value
through profit and loss.
(I) Financial assets
Interest income
Cash and bank balances
Interest income is accrued on a time proportion basis, by
Cash and bank balances consist of:
reference to the principal outstanding and effective interest
(i) Cash and cash equivalents - which include cash on hand, rate applicable.
deposits held at call with banks and other short-term
deposits which are readily convertible into known Dividend income
amounts of cash, are subject to an insignificant risk of Dividend income from investments is recognised when the right
change in value and have original maturities of less than to receive payment has been established.
one year. These balances with banks are unrestricted for
withdrawal and usage. Impairment of financial assets
Loss allowance for expected credit losses is recognised for
(ii) Other bank balances - which include balances and deposits
financial assets measured at amortised cost and fair value
with banks that are restricted for withdrawal and usage.
through other comprehensive income.
Financial assets at amortised cost The Company recognises lifetime expected credit losses for all
Financial assets are subsequently measured at amortised cost if trade receivables that do not constitute a financing transaction.
these financial assets are held within a business model whose
For financial assets (apart from trade receivables that do not
objective is to hold these assets in order to collect contractual
constitute of financing transaction) whose credit risk has not
cash flows and the contractual terms of the financial asset give
significantly increased since initial recognition, loss allowance
equal to twelve months expected credit losses is recognised.
221
STANDALONE
NOTES
forming part of the financial statements
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) The retirement benefit obligations recognised in the balance
sheet represents the present value of the defined benefit
at the time the asset or liability is recognised, the associated obligations as reduced by the fair value of plan assets.
gains or losses on the derivative that had previously been
recognised in equity are included in the initial measurement Compensated absences
of the asset or liability. For hedges that do not result in the Compensated absences which are not expected to occur
recognition of a non-financial asset or a liability, amounts within twelve months after the end of the period in which the
deferred in equity are recognised in the statement of profit employee renders the related service are recognised based on
and loss in the same period in which the hedged item affects actuarial valuation at the present value of the obligation as on
the statement of profit and loss. the reporting date.
In cases where hedge accounting is not applied, changes in the (p) Inventories
fair value of derivatives are recognised in the statement of profit
Inventories are stated at the lower of cost and net realisable
and loss as and when they arise.
value. Cost is ascertained on a weighted average basis.
Hedge accounting is discontinued when the hedging instrument Costs comprise direct materials and, where applicable, direct
expires or is sold, terminated, or exercised, or no longer qualifies labour costs and those overheads that have been incurred in
for hedge accounting. At that time, any cumulative gain or loss bringing the inventories to their present location and condition.
on the hedging instrument recognised in equity is retained Net realisable value is the price at which the inventories can
in equity until the forecasted transaction occurs. If a hedged be realised in the normal course of business after allowing for
transaction is no longer expected to occur, the net cumulative the cost of conversion from their existing state to a finished
gain or loss recognised in equity is transferred to the statement condition and for the cost of marketing, selling and distribution.
of profit and loss for the period.
Provisions are made to cover slow-moving and obsolete items
(o) Employee benefits based on historical experience of utilisation on a product
category basis, which involves individual businesses considering
Defined contribution plans their product lines and market conditions.
Contributions under defined contribution plans are recognised
as expense for the period in which the employee has rendered (q) Provisions
the service. Payments made to state managed retirement benefit Provisions are recognised in the balance sheet when the
schemes are dealt with as payments to defined contribution Company has a present obligation (legal or constructive) as a
schemes where the Company’s obligations under the schemes result of a past event, which is expected to result in an outflow of
are equivalent to those arising in a defined contribution resources embodying economic benefits which can be reliably
retirement benefit scheme. estimated. Each provision is based on the best estimate of the
expenditure required to settle the present obligation at the
Defined benefit plans balance sheet date. Where the time value of money is material,
For defined benefit retirement schemes, the cost of providing provisions are measured on a discounted basis.
benefits is determined using the Projected Unit Credit Method,
Constructive obligation is an obligation that derives from an
with actuarial valuation being carried out at each year-end
entity’s actions where:
balance sheet date. Remeasurement gains and losses of the net
defined benefit liability/(asset) are recognised immediately in (a)
by an established pattern of past practice, published
other comprehensive income. The service cost and net interest policies or a sufficiently specific current statement, the
on the net defined benefit liability/(asset) are recognised as an entity has indicated to other parties that it will accept
expense within employee costs. certain responsibilities and;
Past service cost is recognised as an expense when the plan (b) as a result, the entity has created a valid expectation on
amendment or curtailment occurs or when any related the part of those other parties that it will discharge such
restructuring costs or termination benefits are recognised, responsibilities.
whichever is earlier.
223
STANDALONE
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) the statement of profit and loss, with all prior periods being
presented on this basis.
(r) Onerous contracts
(u) Income taxes
A provision for onerous contracts is recognised when the
expected benefits to be derived by the Company from a Tax expense for the period comprises current and deferred
contract are lower than the unavoidable cost of meeting its tax. The tax currently payable is based on taxable profit for the
obligations under the contract. The provision is measured at the period. Taxable profit differs from net profit as reported in the
present value of the lower of the expected cost of terminating statement of profit and loss because it excludes items of income
the contract and the expected net cost of continuing with or expense that are taxable or deductible in other years and
the contract. Before a provision is established, the Company it further excludes items that are never taxable or deductible.
recognises any impairment loss on the assets associated The Company’s liability for current tax is calculated using tax
with that contract. rates and tax laws that have been enacted or substantively
enacted by the end of the reporting period.
(s) Government grants
Deferred tax is the tax expected to be payable or recoverable on
Government grants are recognised at its fair value, where differences between the carrying value of assets and liabilities
there is a reasonable assurance that such grants will be in the financial statements and the corresponding tax bases
received and compliance with the conditions attached used in the computation of taxable profit and is accounted for
therewith have been met. using the balance sheet liability method. Deferred tax liabilities
Government grants related to expenditure on property, plant are generally recognised for all taxable temporary differences.
and equipment are credited to the statement of profit and loss In contrast, deferred tax assets are only recognised to the extent
over the useful lives of qualifying assets or other systematic that it is probable that future taxable profits will be available
basis representative of the pattern of fulfilment of obligations against which the temporary differences can be utilised.
associated with the grant received. Grants received less amounts The carrying value of deferred tax assets is reviewed at the end
credited to the statement of profit and loss at the reporting date of each reporting period and reduced to the extent that it is no
are included in the balance sheet as deferred income. longer probable that sufficient taxable profits will be available
to allow all or part of the asset to be recovered.
(t) Non-current assets held for sale and discontinued
operations Deferred tax is calculated at the tax rates that are expected to
Non-current assets and disposal groups classified as held for apply in the period when the liability is settled or the asset is
sale are measured at the lower of their carrying value and fair realised based on the tax rates and tax laws that have been
value less costs to sell. enacted or substantially enacted by the end of the reporting
period. The measurement of deferred tax liabilities and assets
Assets and disposal groups are classified as held for sale if their reflects the tax consequences that would follow from the
carrying value will be recovered through a sale transaction manner in which the Company expects, at the end of the
rather than through continuing use. This condition is only met reporting period, to recover or settle the carrying value of its
when the sale is highly probable and the asset, or disposal assets and liabilities.
group, is available for immediate sale in its present condition
and is marketed for sale at a price that is reasonable in relation to Deferred tax assets and liabilities are offset to the extent that
its current fair value. The Company must also be committed to they relate to taxes levied by the same tax authority and there
the sale, which should be expected to qualify for recognition as are legally enforceable rights to set off current tax assets and
a completed sale within one year from the date of classification. current tax liabilities within that jurisdiction.
Where a disposal group represents a separate major line of Current and deferred tax are recognised as an expense or income
business or geographical area of operations, or is part of a in the statement of profit and loss, except when they relate to
single co-ordinated plan to dispose of a separate major line of items credited or debited either in other comprehensive income
business or geographical area of operations, then it is treated or directly in equity, in which case the tax is also recognised in
as a discontinued operation. The post-tax profit or loss of other comprehensive income or directly in equity.
the discontinued operation together with the gain or loss Deferred tax assets include Minimum Alternate Tax (MAT) paid
recognised on its disposal are disclosed as a single amount in in accordance with the tax laws in India, which is likely to give
future economic benefits in the form of availability of set off
NOTES
forming part of the financial statements
2. Significant accounting policies (Contd.) As a consequence, the Company does not adjust any of the
transaction prices for the time value of money.
against future income tax liability. MAT is recognised as deferred
tax assets in the balance sheet when the asset can be measured Sale of power
reliably and it is probable that the future economic benefit Revenue from sale of power is recognised when the services
associated with the asset will be realised. are provided to the customer based on approved tariff
rates established by the respective regulatory authorities.
(v) Revenue The Company doesn’t recognise revenue and an asset for cost
The Company manufactures and sells a range of steel and incurred in the past that will be recovered.
other products.
(w) Foreign currency transactions and translations
Effective April 1, 2018, the Company has applied Ind AS 115
The financial statements of the Company are presented in Indian
which establishes a comprehensive framework for determining
Rupees (‘`’), which is the functional currency of the Company
whether, how much and when revenue is to be recognised.
and the presentation currency for the financial statements.
Ind AS 115 replaces Ind AS 18 Revenue and Ind AS 11
Construction Contracts. The Company has adopted Ind AS 115 In preparing the financial statements, transactions in currencies
using the retrospective effect method. The adoption of the new other than the Company’s functional currency are recorded at the
standard did not have a material impact on the Company. rates of exchange prevailing on the date of the transaction. At the
end of each reporting period, monetary items denominated in
Sale of products foreign currencies are re-translated at the rates prevailing at
Revenue from sale of products is recognised when control of the the end of the reporting period. Non-monetary items carried
products has transferred, being when the products are delivered at fair value that are denominated in foreign currencies are
to the customer. Delivery occurs when the products have been re-translated at the rates prevailing on the date when the fair
shipped or delivered to the specific location as the case may be, value was determined. Non-monetary items that are measured
the risks of loss has been transferred, and either the customer in terms of historical cost in a foreign currency are not translated.
has accepted the products in accordance with the sales contract,
Exchange differences arising on translation of long-term
or the Company has objective evidence that all criteria for
foreign currency monetary items recognised in the financial
acceptance have been satisfied. Sale of products include related
statements before the beginning of the first Ind AS financial
ancillary services, if any.
reporting period in respect of which the Company has elected
Goods are often sold with volume discounts based on aggregate to recognise such exchange differences in equity or as part of
sales over a 12 months period. Revenue from these sales is cost of assets as allowed under Ind AS 101-“First-time adoption
recognised based on the price specified in the contract, net of of Indian Accounting Standards” are added/deducted to/ from
the estimated volume discounts. Accumulated experience is the cost of assets as the case may be. Such exchange differences
used to estimate and provide for the discounts, using the most recognised in equity or as part of cost of assets is recognised in
likely method, and revenue is only recognised to the extent that the statement of profit and loss on a systematic basis.
it is highly probable that a significant reversal will not occur.
Exchange differences arising on the re-translation or settlement
A liability is recognised for expected volume discounts payable
of other monetary items are included in the statement of profit
to customers in relation to sales made until the end of the
and loss for the period.
reporting period. No element of financing is deemed present
as the sales are generally made with a credit term of 30-90 (x) Borrowing costs
days, which is consistent with market practice. Any obligation
Borrowing costs directly attributable to the acquisition,
to provide a refund is recognised as a provision. A receivable is
construction or production of qualifying assets, which are assets
recognised when the goods are delivered as this is the point in
that necessarily take a substantial period of time to get ready
time that the consideration is unconditional because only the
for their intended use or sale, are added to the cost of those
passage of time is required before the payment is due.
assets, until such time as the assets are substantially ready for
The Company does not have any contracts where the period the intended use or sale.
between the transfer of the promised goods or services to the
Investment income earned on temporary investment of specific
customer and payment by the customer exceeds one year.
borrowings pending their expenditure on qualifying assets is
recognised in the statement of profit and loss.
225
STANDALONE
NOTES
forming part of the financial statements
(y) Earnings per share Appendix C, ‘Uncertainty over Income Tax Treatments’,
to Ind AS 12, ‘Income Taxes’
Basic earnings per share is computed by dividing profit or loss for
the year attributable to equity holders by the weighted average This Appendix clarifies how the recognition and measurement
number of shares outstanding during the year. Partly paid up requirements of Ind AS 12 ‘Income Taxes’, are applied while
shares are included as fully paid equivalents according to the performing the determination of taxable profit or loss, tax bases,
fraction paid up. unused tax losses, unused tax credits and tax rates, when there is
uncertainty over income tax treatments under Ind AS 12.
Diluted earnings per share is computed using the weighted
average number of shares and dilutive potential shares except According to the Appendix, companies need to determine the
where the result would be anti-dilutive. probability of the relevant tax authority accepting each tax
treatment, or group of tax treatments, that the companies have
(z) Recent accounting pronouncements used or plan to use in their income tax filing which has to be
Ministry of Corporate Affairs (“MCA”) has notified the following considered to compute the most likely amount or the expected
new amendments to Ind AS which the Company has not value of the tax treatment when determining taxable profit or
applied as they are effective for annual periods beginning on or loss, tax bases, unused tax losses, unused tax credits and tax rates.
after April 1, 2019. The Company is in the process of evaluating the impact
of adoption of the above pronouncements on its
financial statements.
NOTES
forming part of the financial statements
(` crore)
Land Buildings Plant and Furniture, Vehicles Railway Total
including machinery fixtures sidings
roads and office
equipments
Cost/deemed cost as at April 1, 2018 14,117.17 5,902.00 60,846.29 431.26 304.62 1,056.94 82,658.28
Additions 75.79 221.14 2,613.71 118.90 86.83 23.45 3,139.82
Disposals - (13.80) (0.37) (1.26) (12.48) - (27.91)
Other re-classifications - - 9.05 - (9.05) - -
Cost/deemed cost as at March 31, 2019 14,192.96 6,109.34 63,468.68 548.90 369.92 1,080.39 85,770.19
Impairment as at April 1, 2018 0.15 1.32 0.09 - - - 1.56
Accumulated impairment as at March 31, 2019 0.15 1.32 0.09 - - - 1.56
Accumulated depreciation as at April 1, 2018 493.55 690.56 9,980.12 291.37 164.42 93.80 11,713.82
Charge for the year 115.61 233.32 3,162.19 73.19 30.51 37.85 3,652.67
Disposals - (2.06) (0.29) (1.19) (11.14) - (14.68)
Other re-classifications - - 6.00 - (6.00) - -
Accumulated depreciation as at March 31, 2019 609.16 921.82 13,148.02 363.37 177.79 131.65 15,351.81
Total accumulated depreciation and 609.31 923.14 13,148.11 363.37 177.79 131.65 15,353.37
impairment as at March 31, 2019
Net carrying value as at April 1, 2018 13,623.47 5,210.12 50,866.08 139.89 140.20 963.14 70,942.90
Net carrying value as at March 31, 2019 13,583.65 5,186.20 50,320.57 185.53 192.13 948.74 70,416.82
(` crore)
Land Buildings Plant and Furniture, Vehicles Railway Total
including machinery fixtures sidings
roads and office
equipments
Cost/deemed cost as at April 1, 2017 14,058.74 5,722.77 58,458.26 352.18 324.15 1,024.00 79,940.10
Additions 58.43 179.23 2,414.33 82.96 17.44 32.94 2,785.33
Disposals - - (26.30) (3.88) (36.97) - (67.15)
Cost/deemed cost as at March 31, 2018 14,117.17 5,902.00 60,846.29 431.26 304.62 1,056.94 82,658.28
Impairment as at April 1, 2017 0.15 1.32 0.09 - - - 1.56
Accumulated impairment as at March 31, 2018 0.15 1.32 0.09 - - - 1.56
Accumulated depreciation as at April 1, 2017 390.40 461.43 6,844.56 246.46 159.14 57.58 8,159.57
Charge for the period 103.15 229.13 3,140.58 48.72 27.64 36.22 3,585.44
Disposals - - (5.02) (3.81) (22.36) - (31.19)
Accumulated depreciation as at March 31, 2018 493.55 690.56 9,980.12 291.37 164.42 93.80 11,713.82
Total accumulated depreciation and 493.70 691.88 9,980.21 291.37 164.42 93.80 11,715.38
impairment as at March 31, 2018
Net carrying value as at April 1, 2017 13,668.19 5,260.02 51,613.61 105.72 165.01 966.42 71,778.97
Net carrying value as at March 31, 2018 13,623.47 5,210.12 50,866.08 139.89 140.20 963.14 70,942.90
(i) Buildings include `2.32 crore (March 31, 2018: `2.32 crore) being cost of shares in co-operative housing societies and limited companies.
227
STANDALONE
NOTES
forming part of the financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Assets held under finance leases
Cost/deemed cost 3,851.65 3,632.46
Accumulated depreciation and impairment 1,700.33 1,590.98
2,151.32 2,041.48
50,320.57 50,866.08
(iii) Net carrying value of furniture, fixtures and office equipments comprises of:
(` crore)
As at As at
March 31, 2019 March 31, 2018
Furniture and fixtures
Cost/deemed cost 118.24 104.02
Accumulated depreciation and impairment 94.67 80.04
23.57 23.98
Office equipments
Cost/deemed cost 430.66 327.24
Accumulated depreciation and impairment 268.70 211.33
161.96 115.91
185.53 139.89
`88.68 crore (2017-18: `75.96 crore) of borrowing costs has been capitalised during the year on qualifying assets under construction
(iv)
using a capitalisation rate of 9.00% (2017-18: 9.00%).
(v) Rupee liability has increased by `106.56 crore (March 31, 2018: `44.33 crore) arising out of re-translation of the value of long-term foreign
currency loans and liabilities for procurement of property, plant and equipment, generally plant and machinery. This increase is adjusted
against the carrying cost of assets and depreciated over their remaining useful life. The depreciation for the current year is higher by
`3.50 crore (2017-18: `1.39 crore) on account of this adjustment.
(vi) Property, plant and equipment (including capital work-in-progress) were tested for impairment during the year where indicators of
impairment existed. During the year ended March 31, 2019, the Company has recognised an impairment charge of `8.54 crore (2017-18:
`33.99 crore) in respect of expenditure incurred (included within capital work-in-progress) at one of its mining sites. The impairment
recognised is included within other expenses in the statement of profit and loss.
NOTES
forming part of the financial statements
(vii) Property, plant and equipment includes capital cost of in-house research facilities as below:
(` crore)
Buildings Plant and Furniture, Vehicles Total
machinery fixtures and office
equipments
4. Leases
The Company has taken certain land, buildings, plant and machinery under operating and/or finance leases. The following is a summary of the
future minimum lease rental payments under non-cancellable operating leases and finance leases entered into by the Company.
A. Operating leases:
Significant leasing arrangements include lease of land for periods ranging between 12 to 99 years renewable on mutual consent, lease of office
space and assets dedicated for use under long-term arrangements. Payments under long-term arrangements involving use of dedicated assets
are allocated between those relating to the right to use of assets, executory services and for output based on the underlying contractual terms
and conditions. Any change in the allocation assumptions may have an impact on lease assessment and/or lease classification. Payments linked
to changes in inflation index under the lease arrangements have been considered as contingent rent and recognised in the statement of profit
and loss as and when incurred.
Future minimum lease payments under non-cancellable operating leases is as below:
(` crore)
Minimum lease payments
As at As at
March 31, 2019 March 31, 2018
Not later than one year 120.57 111.60
Later than one year but not later than five years 436.38 352.18
Later than five years 954.28 992.63
1,511.23 1,456.41
During the year ended March 31, 2019, total operating lease rental expense recognised in the statement of profit and loss was `222.76 crore,
(2017-18: `252.12 crore) including contingent rent of `49.27 crore (2017-18: `31.20 crore).
229
STANDALONE
NOTES
forming part of the financial statements
4. Leases (Contd.)
B. Finance leases:
Significant leasing arrangements include assets dedicated for use under long-term arrangements. The arrangements cover a substantial part
of the economic life of the underlying assets and generally contain a renewal option on expiry. Payments under long-term arrangements
involving use of dedicated assets are allocated between those relating to the right to use of assets, executory services and for output based
on underlying contractual terms and conditions. Any change in the allocation assumptions may have an impact on lease assessment and/or
lease classification.
The minimum lease payments and such payments excluding future finance charges in respect of arrangements classified as finance
leases is as below:
(` crore)
As at March 31, 2019 As at March 31, 2018
Minimum lease Minimum lease Minimum lease Minimum lease
payments payments less payments payments less
future finance future finance
charges charges
NOTES
forming part of the financial statements
5. Intangible assets
[Item No. I(c), Page 210]
(` crore)
Software Mining Total
costs assets
(` crore)
Software Mining Total
costs assets
(i) Mining assets represent expenditure incurred in relation to acquisition of mines, mine development expenditure post establishment of
technical and commercial feasibility and restoration obligations as per applicable regulations.
(ii) The Company has recognised an impairment charge of `5.17 crore (including intangible under development) (2017-18 Nil) for expenditure
incurred in respect of certain mines which are not in operation.
(iii) Software costs related to in-house development included within software costs is `0.28 crore (2017-18: `0.27 crore).
231
STANDALONE
NOTES
forming part of the financial statements
(` crore)
No. of shares as at March As at As at
31, 2019 (face value of `10 March 31, 2019 March 31, 2018
each fully paid-up unless
otherwise specified)
NOTES
forming part of the financial statements
(` crore)
No. of shares as at March As at As at
31, 2019 (face value of `10 March 31, 2019 March 31, 2018
each fully paid-up unless
otherwise specified)
233
STANDALONE
NOTES
forming part of the financial statements
(` crore)
No. of shares as at March As at As at
31, 2019 (face value of `10 March 31, 2019 March 31, 2018
each fully paid-up unless
otherwise specified)
(8) Tata BlueScope Steel Private Limited (formerly Tata BlueScope 43,30,00,000 433.00 433.00
Steel Limited)
(9) Tata NYK Shipping Pte Ltd. 6,51,67,500 350.14 350.14
(Face value of USD 1 each)
(10) TM International Logistics Limited 91,80,000 9.18 9.18
(11) T M Mining Company Limited 2,29,116 0.23 0.16
(Inter-corporate deposits converted to 66,316 shares during
the year)
1,623.23 1,470.16
Aggregate provision for impairment in value of investments (13.17) (13.10)
1,610.06 1,457.06
Total investments in subsidiaries, associates and joint ventures 4,437.76 3,666.24
* These investments are carried at a book value of `1.00
(i) The Company holds 51% of the equity share capital in TM International Logistics Limited, Jamshedpur Continuous Annealing & Processing
Company Private Limited and T M Mining Company Limited. However, decisions in respect of activities which significantly affect the risks
and rewards of these businesses, require unanimous consent of all the shareholders. These entities have therefore been considered as
joint ventures.
(ii) Carrying value and market value of quoted and unquoted investments are as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Investment in subsidiary companies:
Aggregate carrying value of quoted investments 687.43 507.86
Aggregate market value of quoted investments 2,876.68 3,211.31
Aggregate carrying value of unquoted investments 2,134.48 1,653.15
(b) Investment in associate companies:
Aggregate carrying value of quoted investments 5.79 5.79
Aggregate market value of quoted investments 44.87 83.66
Aggregate carrying value of unquoted investments - 42.38
(c) Investment in joint ventures:
Aggregate carrying value of unquoted investments 1,610.06 1,457.06
(iii) During the year ended March 31, 2019, the Company acquired 51% stake in Creative Port Development Private Limited (CPDPL) a proposed
greenfield port project. Consequent to the acquisition, Subarnarekha Port Private Limited became a subsidiary of the Company.
(iv) During the year ended March 31, 2019, the Company through its wholly owned subsidiary Bamnipal Steel Limited, completed the
acquisition of Tata Steel BSL Limited (formerly Bhushan Steel Limited) pursuant to a corporate insolvency resolution process implemented
under the Insolvency and Bankruptcy Code, 2018.
(v) The Hon’ble National Company Law Tribunal (NCLT), Kolkata vide order dated April 5, 2019 has admitted the initiation of Corporate
Insolvency Resolution Process (CIRP) in respect of Tayo Rolls Limited, a subsidiary of the Company.
NOTES
forming part of the financial statements
7. Investments
[Item No. I(f )(i) and II(b)(i), Page 210]
A. Non-current
(` crore)
No. of shares as at March As at As at
31, 2019 (face value of `10 March 31, 2019 March 31, 2018
each fully paid-up unless
otherwise specified)
235
STANDALONE
NOTES
forming part of the financial statements
7. Investments (Contd.)
[Item No. I(f )(i) and II(b)(i), Page 210]
(` crore)
No. of shares as at March As at As at
31, 2019 (face value of `10 March 31, 2019 March 31, 2018
each fully paid-up unless
otherwise specified)
NOTES
forming part of the financial statements
7. Investments (Contd.)
[Item No. I(f )(i) and II(b)(i), Page 210]
(` crore)
No. of shares as at March As at As at
31, 2019 (face value of `10 March 31, 2019 March 31, 2018
each fully paid-up unless
otherwise specified)
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
Investments carried at fair value through profit and loss:
Investment in mutual funds – Unquoted
(1) Aditya Birla Sun Life Cash Plus - Growth - 1,191.57
(2) Axis Liquid Fund - Growth - 1,477.02
(3) Baroda Pioneer Liquid Fund - Growth - 882.72
(4) DSP BlackRock Liquidity Fund - Growth - 1,250.63
(5) HDFC Cash Management Fund - Saving Plan - Growth - 1,044.26
(6) ICICI Prudential Money Market Fund - Growth - 1,440.59
(7) IDBI Liquid Fund - Growth - 741.08
(8) IDFC Cash Fund - Growth - 952.69
(9) Invesco India Liquid Fund - Growth - 1,246.89
(10) Kotak Liquid Scheme - Growth - 616.07
(11) LIC MF Liquid Fund - Growth - 738.43
(12) Reliance Liquidity Fund - Growth - 1,329.38
(13) Reliance MF ETF Liquid - 0.09
(14) SBI Premier Liquid Fund - Growth - 878.38
(15) Tata Liquid Fund - Growth 477.47 -
(16) Tata Money Market Fund - Growth - 850.57
477.47 14,640.37
237
STANDALONE
NOTES
forming part of the financial statements
7. Investments (Contd.)
[Item No. I(f )(i) and II(b)(i), Page 210]
(i) Carrying value and market value of quoted and unquoted investments are as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Investments in quoted instruments:
Aggregate carrying value 448.61 497.21
Aggregate market value 448.61 497.21
(ii) Cumulative gain on de-recognition of investments during the year which were carried at fair value through other comprehensive income
amounted to `1.49 crore (2017-18: `3,427.46 crore). Fair value of such investments as on the date of de-recognition was `1.97 crore
(2017-18: `3,782.76 crore).
# Cost of unquoted equity instruments has been considered as an appropriate estimate of fair value because of a wide range of possible fair
value measurements and cost represents the best estimate of fair value within that range.
NOTES
forming part of the financial statements
7. Investments (Contd.)
[Item No. I(f )(i) and II(b)(i), Page 210]
(iii) Details of other unquoted investments carried at fair value through other comprehensive income is as below:
(a) Barajamda Iron Ore Mine Workers’ Central Co-operative Stores Ltd. 200 5,000.00 5,000.00
(Face value of `25 each)
(b) Bokaro and Ramgarh Ltd. 100 16,225.00 16,225.00
(c) Eastern Synpacks Limited (Face value of `25 each) 1,50,000 1.00 1.00
(d) Ferro Manganese Plant Employees’ Consumer Co-operative Society Ltd. 100 2,500.00 2,500.00
(Face value of `25 each)
(e) Investech Advisory Services (India) Limited(Face value of `100 each) 1,680 1.00 1.00
(f ) Jamshedpur Co-operative House Building Society Ltd. 10 1,000.00 1,000.00
(Face value of `100 each)
(g) Jamshedpur Co-operative Stores Ltd. (Face value of `5 each) 50 250.00 250.00
(h) Jamshedpur Educational and Culture Co-operative Society Ltd. 50 5,000.00 5,000.00
(Face value of `100 each)
(i) Joda East Iron Mine Employees’ Consumer Co-operative Society Ltd. 100 2,500.00 2,500.00
(Face value of `25 each)
(j) Kumardhubi Fireclay and Silica Works Ltd. 1,50,001 1.00 1.00
(k) Kumardhubi Metal Casting and Engineering Ltd. 10,70,000 1.00 1.00
(l) Namtech Electronic Devices Limited 48,026 1.00 1.00
(m) Reliance Firebrick and Pottery Company Ltd. (Partly paid-up) 16,800 1.00 1.00
(n) Reliance Firebrick and Pottery Company Ltd. 2,400 1.00 1.00
(o) Sanderson Industries Ltd. 3,33,876 2.00 2.00
(p) Standard Chrome Ltd. 11,16,000 2.00 2.00
(q) Sijua (Jherriah) Electric Supply Co. Ltd. 4,144 40,260.00 40,260.00
(r) Tata Construction and Projects Ltd. 11,97,699 1.00 1.00
(s) TBW Publishing and Media Pvt. Limited 100 1.00 1.00
(t) Wellman Incandescent India Ltd. 15,21,234 2.00 2.00
(u) Woodland Multispeciality Hospital Ltd. 1,25,000 1.00 1.00
(v) Unit Trust of India - Mastershares 2,229 47,477.00 47,477.00
1,20,228.00 1,20,228.00
239
STANDALONE
NOTES
forming part of the financial statements
8. Loans
[Item No. I(f )(ii) and II(b)(v), Page 210]
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Security deposits
Considered good - Unsecured 200.13 193.84
Credit impaired 2.02 2.12
Less: Allowance for credit losses 2.02 2.12
200.13 193.84
(b) Loans to related parties
Considered good - Unsecured 13.00 -
Credit impaired 558.95 558.95
Less: Allowance for credit losses 558.95 558.95
13.00 -
(c) Other loans
Considered good - Unsecured 18.03 19.66
Credit impaired 0.53 0.87
Less: Allowance for credit losses 0.53 0.87
18.03 19.66
231.16 213.50
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Loans to related parties
Considered good - Unsecured 52.01 69.26
Credit impaired 68.72 68.25
Less: Allowance for credit losses 68.72 68.25
52.01 69.26
(b) Other loans
Considered good - Unsecured 3.91 4.87
Credit impaired 2.00 2.00
Less: Allowance for credit losses 2.00 2.00
3.91 4.87
55.92 74.13
(i) Security deposits are primarily in relation to public utility services and rental agreements. It includes deposit with a subsidiary
`14.00 crore (March 31, 2018: `14.00 crore) and deposit with Tata Sons Private Limited `1.25 crore (March 31, 2018: `1.25 crore).
(ii) Non-current loans to related parties represent loans given to subsidiaries `571.95 crore (March 31, 2018: `558.95 crore), out of which
`558.95 crore (March 31, 2018: `558.95 crore) is impaired.
(iii) Current loans to related parties represent loans/advances given to subsidiaries `92.06 crore (March 31, 2018: `90.69 crore) and joint ventures
`28.67 crore (March 31, 2018: `46.82 crore) out of which `67.65 crore (2017-18: `67.65 crore) and `1.07 crore (2017-18: `0.60 crore)
respectively is impaired.
(iv) Other loans primarily represent loans given to employees.
NOTES
forming part of the financial statements
8. Loans (Contd.)
[Item No. I(f )(ii) and II(b)(v), Page 210]
(v) Disclosure as per Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,
2015 and Section 186(4) of the Companies Act, 2013.
(a) Loans/advances in the nature of loan outstanding from subsidiaries, associates and joint ventures for the year ended March 31, 2019:
(` crore)
Debts Maximum balance
Name of the Company outstanding as at outstanding during
March 31, 2019 the year
Subsidiaries
(1) Bamnipal Steel Limited - 18,631.65
(interest rate 10.00 %) - -
Associate
(1) TRF Limited. - 242.00
(interest rate 10.00 % to 10.51 %) - -
Joint ventures
(1) Industrial Energy Limited 27.60 46.22
(interest rate 10.00 %) 46.22 46.22
241
STANDALONE
NOTES
forming part of the financial statements
8. Loans (Contd.)
[Item No. I(f )(ii) and II(b)(v), Page 210]
(ii) As at March 31, 2019, loans given to Tayo Rolls Limited, Tata Steel (KZN) (Pty) Ltd. and S & T Mining Company Private Limited were
fully impaired.
(b) Details of investments made and guarantees provided are given in note 6, page 232, note 7, page 235 and note 36B, page 278.
(vi) There are no outstanding debts from directors or other officers of the Company.
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Interest accrued on deposits and loans
Considered good - Unsecured 0.50 0.67
(c) Others
Considered good - Unsecured 275.19 0.58
Credit impaired - 2.00
Less: Allowance for credit losses - 2.00
275.19 0.58
310.65 21.21
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Interest accrued on deposits and loans
Considered good - Unsecured 6.30 27.54
Credit impaired 14.32 14.32
Less: Allowance for credit losses 14.32 14.32
6.30 27.54
(b) Others
Considered good - Unsecured 934.46 463.97
940.76 491.51
NOTES
forming part of the financial statements
(i) Non-current earmarked balances with banks represent deposits and balances in escrow account not due for realisation within 12
months from the balance sheet date. These are primarily placed as security with government bodies, margin money against issue of
bank guarantees.
(ii) Non-current other financial assets include advance against purchase of equity shares in subsidiaries `275.19 crore (of which `258.69 crore
has been contributed by way of transfer of assets) (March 31, 2018: `2.00 crore) out of which Nil (March 31, 2018: `2.00 crore) is impaired.
(iii) Current other financial assets include amount receivable from post-employment benefit funds `755.95 crore (March 31, 2018: `296.38
crore) on account of retirement benefit obligations paid by the Company directly.
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Profit before tax 16,227.25 6,638.25
Expected income tax expense at statutory income tax rate of 34.944 % (2017-18: 34.608 %) 5,670.45 2,297.36
(a) Income exempt from tax/Items not deductible 48.98 116.62
(b) Additional tax benefit for capital investment including research and development expenditures (25.37) (26.79)
(c) Impact of change in tax rate(i) - 81.51
Tax expense as reported 5,694.06 2,468.70
(i) During the year ended March 31, 2018, the Company re-measured deferred tax balances expected to reverse in future periods based on
changes in statutory tax rate made by the Finance Act, 2018.
243
STANDALONE
NOTES
forming part of the financial statements
(` crore)
Balance Recognised/ Recognised Recognised Other Balance
as at (reversed) in other in equity during movements as at
April 1, 2018 in profit and comprehensive the year during the year March 31, 2019
loss during the income during
year the year
NOTES
forming part of the financial statements
Components of deferred tax assets and liabilities as at March 31, 2018 is as below:
(` crore)
Balance Recognised/ Recognised Recognised Balance
as at (reversed) in other in equity during as at
April 1, 2017 in profit and comprehensive the year March 31, 2018
loss during the income during the
year year
245
STANDALONE
NOTES
forming part of the financial statements
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Capital advances
Considered good - Unsecured 706.50 299.65
Considered doubtful - Unsecured 83.86 90.76
Less: Provision for doubtful advances 83.86 90.76
706.50 299.65
(e) Others
Considered good - Unsecured 47.90 -
2,535.98 2,140.84
NOTES
forming part of the financial statements
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Advances with public bodies
Considered good - Unsecured 1,575.77 1,440.57
Considered doubtful - Unsecured 2.43 2.35
Less: Provision for doubtful advances 2.43 2.35
1,575.77 1,440.57
(b) Advances to related parties
Considered good - Unsecured 140.03 171.29
140.03 171.29
(d) Others
Considered good - Unsecured 482.51 187.22
Considered doubtful - Unsecured 66.10 60.77
Less: Provision for doubtful advances 66.10 60.77
482.51 187.22
2,209.98 1,812.05
(i) Advances with public bodies primarily relate to input credit entitlements and amounts paid under protest in respect of demands and
claims from regulatory authorities.
(ii) Prepaid lease payments for operating leases relate to land leases classified as operating as the title is not expected to transfer at the end
of the lease term and considering that the land has an indefinite economic life.
(iii) Others include advances against supply of goods/services and advances paid to employees.
247
STANDALONE
NOTES
forming part of the financial statements
12. Inventories
[Item No. II(a), Page 210]
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Raw materials 4,496.38 4,953.20
(b) Work-in-progress 14.54 6.77
(c) Finished and semi-finished goods 4,129.28 3,602.13
(d) Stock-in-trade 75.54 56.13
(e) Stores and spares 2,539.60 2,405.18
11,255.34 11,023.41
Included above, goods-in-transit:
(i) Raw materials 671.23 1,152.80
(ii) Finished and semi-finished goods 0.71 -
(iii) Stock-in-trade 66.22 31.99
(iv) Stores and spares 163.35 132.30
901.51 1,317.09
Value of inventories above is stated after provisions (net of reversal) `93.07 crore (March 31, 2018: `51.51 crore) for write-downs to net realisable
value and provision for slow-moving and obsolete items.
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Considered good - Unsecured 1,363.04 1,875.63
(b) Credit impaired 34.74 30.97
1,397.78 1,906.60
Less: Allowance for credit losses 34.74 30.97
1,363.04 1,875.63
In determining allowance for credit losses of trade receivables, the Company has used the practical expedient by computing the expected
credit loss allowance based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for
forward looking information. The expected credit loss allowance is based on ageing of the receivables and rates used in the provision matrix.
(i) Movements in allowance for credit losses of receivables is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 30.97 18.10
Charge/(release) during the year 3.77 13.86
Utilised during the year - (0.99)
Balance at the end of the year 34.74 30.97
NOTES
forming part of the financial statements
(ii) Ageing of trade receivables and credit risk arising therefrom is as below:
(` crore)
As at March 31, 2019
Gross Allowance for Net
credit risk credit losses credit risk
Amounts not yet due 1,243.54 2.34 1,241.20
One month overdue 65.51 1.66 63.85
Two months overdue 17.34 1.19 16.15
Three months overdue 9.65 2.69 6.96
Between three to six months overdue 16.69 2.63 14.06
Greater than six months overdue 45.05 24.23 20.82
1,397.78 34.74 1,363.04
(` crore)
As at March 31, 2018
Gross Allowance for Net
credit risk credit losses credit risk
Amounts not yet due 1,785.18 0.65 1,784.53
One month overdue 44.25 0.40 43.85
Two months overdue 12.84 0.39 12.45
Three months overdue 6.60 0.67 5.93
Between three to six months overdue 18.12 1.81 16.31
Greater than six months overdue 39.61 27.05 12.56
1,906.60 30.97 1,875.63
(iii) The Company considers its maximum exposure to credit risk with respect to customers as at March 31, 2019 to be `1,363.04 crore
(March 31, 2018: `1,875.63 crore), which is the carrying value of trade receivables after allowance for credit losses.
The Company’s exposure to customers is diversified and no single customer contributes more than 10% of the outstanding receivables as
at March 31, 2019 and March 31, 2018.
(iv) There are no outstanding receivables due from directors or other officers of the Company.
249
STANDALONE
NOTES
forming part of the financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Cash on hand 1.35 0.93
(b) Cheques, drafts on hand 7.74 8.85
(c) Remittances-in-transit 8.97 1.73
(d) Unrestricted balances with banks 526.79 4,577.38
544.85 4,588.89
(i) Cash and bank balances are denominated and held in Indian Rupees.
(` crore)
As at As at
March 31, 2019 March 31, 2018
Earmarked balances with banks 173.26 107.85
(i) Earmarked balances with banks include balances held for: unpaid dividends `64.88 crore (March 31, 2018: `55.00 crore), bank guarantees
and margin money `66.11 crore (March 31, 2018: `36.89 crore).
(ii) Earmarked balances with banks are denominated and held in Indian Rupees.
NOTES
forming part of the financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Authorised:
1,75,00,00,000 Ordinary Shares of `10 each 1,750.00 1,750.00
(March 31, 2018: 1,75,00,00,000 Ordinary Shares of `10 each)
35,00,00,000 ‘A’ Ordinary Shares of `10 each* 350.00 350.00
(March 31, 2018: 35,00,00,000 ‘A’ Ordinary Shares of `10 each)
2,50,00,000 Cumulative Redeemable Preference Shares of `100 each* 250.00 250.00
(March 31, 2018: 2,50,00,000 Shares of `100 each)
60,00,00,000 Cumulative Convertible Preference Shares of `100 each* 6,000.00 6,000.00
(March 31, 2018: 60,00,00,000 Shares of `100 each)
8,350.00 8,350.00
Issued:
1,12,75,20,570 Ordinary Shares of `10 each 1,127.52 1,127.52
(March 31, 2018: 1,12,75,20,570 Ordinary Shares of `10 each)
7,76,97,280 Ordinary Shares of `10 each (partly paid up, `2.504 each paid up) 77.70 77.70
(March 31, 2018: 7,76,97,280 Ordinary Shares of `10 each,
`2.504 each paid up)
1,205.22 1,205.22
* ‘A’ class Ordinary Shares and Preference Shares included within the authorised share capital are for disclosures purposes and have not
yet been issued.
(i) Subscribed and paid up share capital includes 11,81,893 (March 31, 2018: 11,68,393) Ordinary Shares of face value `10 each fully paid up
held by subsidiaries of the Company.
(ii) Details of movement in subscribed and paid up share capital is as below:
As at As at
March 31, 2019 March 31, 2018
No. of shares ` crore No. of shares ` crore
Ordinary Shares of `10 each
Balance at the beginning of the year 1,20,41,19,440 1,145.92 97,12,15,439 971.21
Fully paid shares allotted during the year(a),(b),(c) 4,865 0.00* 15,52,69,376 155.27
Partly paid shares allotted during the year(d) 2,080 0.00* 7,76,34,625 19.44
Balance at the end of the year 1,20,41,26,385 1,145.92 1,20,41,19,440 1,145.92
251
STANDALONE
NOTES
forming part of the financial statements
690 Ordinary Shares of face value `10 each were allotted at a premium of `290 per share to the shareholders whose shares were kept
(a)
in abeyance in the Rights Issue of 2007.
11 Ordinary Shares of face value `10 each were allotted at a premium of `590 per share in lieu of Cumulative Convertible Preference
(b)
Shares of `100 each to the shareholders whose shares were kept in abeyance in the Rights Issue of 2007.
(c) 4
,164 fully paid Ordinary Shares of face value `10 each were allotted at a premium of `500 per share to the shareholders whose
shares were kept in abeyance in the Rights Issue of 2018.
2,080 partly paid Ordinary Shares of face value `10 each (`2.504 paid up) were allotted at a premium of `605 (`151.496 paid up) per
(d)
share to the shareholders whose shares were kept in abeyance in the Rights Issue of 2018.
(iii) The balance proceeds which remained unutilised as at March 31, 2018 from the Rights Issue, 2018 have been fully utilised during the
year as below:
(` crore)
Utilised till March Utilised during the Total
Particulars 31, 2018 year ended
March 31, 2019
As at As at
March 31, 2019 March 31, 2018
No. of Ordinary % held No. of Ordinary % held
Shares Shares
Name of shareholders
(a) Tata Sons Private Limited 38,09,73,085 31.64 38,09,73,085 31.64
(b) Life Insurance Corporation of India 10,83,88,660 9.00 10,83,88,660 9.00
NOTES
forming part of the financial statements
253
STANDALONE
NOTES
forming part of the financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 2,275.00 2,275.00
Balance at the end of the year 2,275.00 2,275.00
The Company had issued hybrid perpetual securities of `775.00 crore and `1,500.00 crore in May 2011 and March 2011 respectively.
These securities are perpetual in nature with no maturity or redemption and are callable only at the option of the Company. The distribution on
these securities are 11.50% p.a. and 11.80% p.a. respectively, with a step up provision if the securities are not called after 10 years. The distribution
on the securities may be deferred at the option of the Company if in the six months preceding the relevant distribution payment date, the
Company has not made payment on, or repurchased or redeemed, any securities ranking pari passu with, or junior to the instrument. As these
securities are perpetual in nature and the Company does not have any redemption obligation, these have been classified as equity.
A. Retained earnings
The details of movement in retained earnings is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 18,700.25 12,280.91
Profit for the year 10,533.19 4,169.55
Remeasurement of post-employment defined benefit plans 5.95 237.63
Tax on remeasurement of post-employment defined benefit plans (2.07) (82.24)
Dividend (1,145.92) (971.22)
Tax on dividend (224.86) (188.41)
Distribution on hybrid perpetual securities (266.12) (266.13)
Tax on distribution on hybrid perpetual securities 92.99 92.70
Transfers within equity(i) 1.49 3,427.46
Balance at the end of the year 27,694.90 18,700.25
(i) Represents profit on sale of investments carried at fair value through other comprehensive income reclassified from investment
revaluation reserve.
B. Items of other comprehensive income
(a) Cash flow hedge reserve
The cumulative effective portion of gains or losses arising from changes in fair value of hedging instruments designated as cash flow hedges
are recognised in cash flow hedge reserve. Such changes recognised are reclassified to the statement of profit and loss when the hedged item
affects the profit or loss or are included as an adjustment to the cost of the related non-financial hedged item.
NOTES
forming part of the financial statements
The Company has designated certain foreign currency forward contracts and interest rate swaps as cash flow hedges in respect of foreign
exchange and interest rate risks.
The details of movement in cash flow hedge reserve is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 5.14 (1.35)
Other comprehensive income recognised during the year (6.91) 6.49
Balance at the end of the year (1.77) 5.14
(i) The details of other comprehensive income recognised during the year is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Fair value changes recognised during the year (27.94) 8.02
Fair value changes reclassified to profit and loss/cost of hedged items 17.32 1.94
Tax impact on above 3.71 (3.47)
(6.91) 6.49
During the year, ineffective portion of cash flow hedges recognised in the statement of profit and loss amounted to Nil (2017-18: Nil)
(ii) The amount recognised in cash flow hedge reserve (net of tax) is expected to impact the statement of profit and loss as below:
- within the next one year: loss `2.17 crore (2017-18: gain `1.39 crore)
- later than one year: gain `0.40 crore (2017-18: gain `3.75 crore)
255
STANDALONE
NOTES
forming part of the financial statements
C.
Other reserves
(a) Securities premium
S ecurities premium is used to record premium received on issue of shares. The reserve is utilised in accordance with the provisions of the
Companies Act, 2013.
The details of movement in securities premium is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 27,779.42 18,873.68
Received/transfer on issue of Ordinary Shares during the year 0.26 8,939.59
Equity issue expenses written (off )/back during the year 0.57 (33.85)
Balance at the end of the year 27,780.25 27,779.42
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 2,046.00 2,046.00
Balance at the end of the year 2,046.00 2,046.00
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 11,596.35 11,596.35
Balance at the end of the year 11,596.35 11,596.35
NOTES
forming part of the financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 20.78 20.78
Balance at the end of the year 20.78 20.78
(e) Others
thers primarily represent amount appropriated out of the statement of profit and loss for unforeseen contingencies. Such appropriations are
O
free in nature.
The details of movement in others during the year is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 117.04 117.04
Balance at the end of the year 117.04 117.04
257
STANDALONE
NOTES
forming part of the financial statements
19. Borrowings
[Item No. IV(a)(i) and V(a)(i), Page 210]
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Secured
(i) Loans from Joint Plant Committee - Steel Development Fund 2,564.10 2,494.42
(b) Unsecured
(i) Non-convertible debentures 12,195.74 9,846.00
(ii) Term loans from banks/financial institutions 9,956.98 10,094.88
(iii) Finance lease obligations 1,934.37 2,133.65
26,651.19 24,568.95
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Secured
(i) Repayable on demand from banks/financial institutions 8.09 34.44
(b) Unsecured
(i) Loans from banks/financial institutions - 635.44
8.09 669.88
(i) As at March 31, 2019, `2,572.19 crore (March 31, 2018: `2,528.86 and charges created and/or to be created on specific items of
crore) of the total outstanding borrowings were secured machinery and equipment procured/to be procured under
by a charge on property, plant and equipment, inventories deferred payment schemes/bill re-discounting schemes/asset
and receivables. credit schemes.
(ii)
The security details of major borrowings as at March 31, The loan is repayable in 16 equal semi-annual instalments after
2019 is as below: completion of four years from the date of the tranche.
(a) Loans from Joint Plant Committee-Steel Development Fund The Company has filed a writ petition before the High Court at
Kolkata in February 2006 claiming waiver of the outstanding
It is secured by mortgages on, all present and future immovable
loan and interest and refund of the balance lying with Steel
properties wherever situated and hypothecation of movable
Development Fund and the matter is subjudice.
assets, excluding land and building mortgaged in favour
of Government of India under the deed of mortgage dated The loan includes funded interest `924.77 crore (March 31,
April 13, 1967 and in favour of Government of Bihar under two 2018: `855.09 crore).
deeds of mortgage dated May 11, 1963, immovable properties
It includes `1,639.33 crore (March 31, 2018: `1,639.33 crore)
and movable assets of the Tube Division, Bearing Division, Ferro
representing repayments and interest on earlier loans for which
Alloys Division and Cold Rolling Complex (West) at Tarapur
applications of funding are awaiting sanction and is not secured
and all investments and book debts of the Company subject
by charge on movable assets of the Company.
to the prior charges created and/or to be created in favour of
bankers for securing borrowing for working capital requirement
NOTES
forming part of the financial statements
19. Borrowings (Contd.) (iv) Rupee loan amounting `750.00 crore (March 31, 2018:
[Item No. IV(a)(i) and V(a)(i), Page 210] `750.00 crore) is repayable in 3 equal annual instalments
commencing from May 21, 2021.
(v) USD 7.86 million equivalent to `54.38 crore (March 31, 2018:
(iii) The details of major unsecured borrowings as at March 31, USD 7.86 million equivalent to `51.24 crore) is repayable
2019 is as below: on March 1, 2021.
(a) Non-convertible debentures (vi) Rupee loan amounting `1,600.00 crore (March 31, 2018:
`2,000.00 crore) is repayable in 8 semi-annual instalments,
(i) 9.84% p.a. interest bearing 43,150 debentures of face value
the next instalment is due on April 30, 2020.
`10,00,000 each are redeemable at par in 4 equal annual
instalments commencing from February 28, 2031. (vii) USD 200.00 million equivalent to `1,383.55 crore
(March 31, 2018: USD 200.00 million equivalent to `1,303.65
(ii) 10.25% p.a. interest bearing 25,000 debentures of face
crore) loan is repayable in 3 equal annual instalments
value `10,00,000 each are redeemable at par in 3 equal
commencing from February 18, 2020.
annual instalments commencing from January 6, 2029.
(viii) Rupee loan amounting `640.42 crore (March 31, 2018:
(iii) 10.25% p.a. interest bearing 5,000 debentures of face value
`646.16 crore) is repayable in 16 semi-annual instalments,
`10,00,000 each are redeemable at par in 3 equal annual
the next instalment is due on August 14, 2019.
instalments commencing from December 22, 2028.
(ix) Euro 16.21 million equivalent to `125.96 crore (March 31,
(iv) 8.15% p.a. interest bearing 10,000 debentures of face value
2018: Euro 21.62 million equivalent to `174.68 crore) loan
`10,00,000 each are redeemable at par on October 1, 2026.
is repayable in 6 equal semi-annual instalments, the next
(v) 2.00% p.a. interest bearing 15,000 debentures of face value instalment is due on July 8, 2019.
`10,00,000 each are redeemable at a premium of 85.03% of
(x) Euro 66.87 million equivalent to `519.58 crore (March 31,
the face value on April 23, 2022.
2018: Euro 85.98 million equivalent to `694.80 crore) loan
(vi) 9.15% p.a. interest bearing 5,000 debentures of face value is repayable in 7 equal semi-annual instalments, the next
`10,00,000 each are redeemable at par on January 24, 2021. instalment is due on April 30, 2019.
(vii) 11.00% p.a. interest bearing 15,000 debentures of face value (xi) Rupee loan amounting `1,485.00 crore (March 31, 2018:
`10,00,000 each are redeemable at par on May 19, 2019. Nil) is repayable in 19 semi-annual instalments, the next
instalment is due on April 16, 2019.
(viii) 10.40% p.a. interest bearing 6,509 debentures of face value
`10,00,000 each are redeemable at par on May 15, 2019. (c) Finance lease obligations
(b) Term loans from banks/financial institutions The Company has taken certain plant and machinery on lease
for business purpose. In addition, the Company has entered into
(i) Rupee loan amounting `2,500.00 crore (March 31, 2018:
long-term arrangements whose fulfilment is dependent on the
`4,450.00 crore) is repayable in 9 quarterly instalments
use of dedicated assets. Some of the arrangements have been
commencing from March 31, 2023.
assessed as being in the nature of lease and have been classified
(ii) Rupee loan amounting `1,047.50 crore (March 31, 2018: as finance lease.
`1,485.00 crore) is repayable in 10 semi-annual instalments,
Finance lease obligations represent the present value of
the next instalment is due on November 29, 2022.
minimum lease payments payable over the lease term.
(iii) Rupee loan amounting `584.58 crore (March 31, 2018: The arrangements have been classified as secured or unsecured
`823.84 crore) is repayable in 8 semi-annual instalments, based on the legal form.
the next instalment is due on June 15, 2021.
259
STANDALONE
NOTES
forming part of the financial statements
(iii) Currency and interest exposure of borrowings including current maturities at the end of the reporting period is as below:
(` crore)
As at March 31, 2019 As at March 31, 2018
Fixed Floating Total Fixed Floating Total
rate rate rate rate
INR 16,476.27 11,162.42 27,638.69 13,234.70 12,663.12 25,897.82
EURO 425.00 212.29 637.29 565.37 326.13 891.50
USD - 1,425.49 1,425.49 - 1,336.48 1,336.48
Total 16,901.27 12,800.20 29,701.47 13,800.07 14,325.73 28,125.80
INR-Indian Rupees, USD-United States Dollars.
(iv) Majority of floating rate borrowings are bank borrowings bearing interest rates based on LIBOR and EURIBOR. Of the total floating rate
borrowings as at March 31, 2019, `1,037.66 crore (March 31, 2018: `977.74 crore) has been hedged using interest rate swaps and collars,
with contracts covering period of more than one year.
(v) Maturity profile of borrowings including current maturities is as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
Not later than one year or on demand 3,325.08 3,902.13
Later than one year but not two years 2,033.20 3,693.68
Later than two years but not three years 1,912.66 2,228.26
Later than three years but not four years 4,206.95 1,966.48
Later than four years but not five years 2,611.95 4,227.71
More than five years 18,625.16 16,510.22
32,715.00 32,528.48
Less: Future finance charges on finance leases 2,560.34 3,746.79
Less: Capitalisation of transaction costs 453.19 655.89
29,701.47 28,125.80
(vi) Some of the Company’s major financing arrangements include financial covenants, which require compliance to certain debt-equity
and debt coverage ratios. Additionally, certain negative covenants may limit the Company’s ability to borrow additional funds or to incur
additional liens, and/or provide for increased costs in case of breach.
NOTES
forming part of the financial statements
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
Creditors for other liabilities 125.07 19.78
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Current maturities of long-term borrowings 2,846.70 2,767.16
(b) Current maturities of finance lease obligations 195.49 119.81
(c) Interest accrued but not due 569.36 556.01
(d) Unclaimed dividends 64.88 55.00
(e) Creditors for other liabilities 3,195.92 3,043.42
6,872.35 6,541.40
(i) Non-current and current creditors for other liabilities include:
(a) creditors for capital supplies and services `1,582.88 crore (March 31, 2018: `1,725.31 crore).
(b) liability for employee family benefit scheme `189.87 crore (March 31, 2018: `184.39 crore).
21. Provisions
[Item No. IV(b) and V(b), Page 210]
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Employee benefits 1,556.66 1,663.88
(b) Others 361.52 297.33
1,918.18 1,961.21
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Employee benefits 300.80 356.27
(b) Others 477.43 379.01
778.23 735.28
(i) Non-current and current provision for employee benefits include provision for leave salaries `999.39 crore (March 31, 2018: `984.33 crore)
and provision for early separation scheme `843.14 crore (March 31, 2018: `1,019.98 crore).
261
STANDALONE
NOTES
forming part of the financial statements
(ii) As per the leave policy of the Company, an employee is entitled to be paid the accumulated leave balance on separation. The Company
presents provision for leave salaries as current and non-current based on actuarial valuation considering estimates of availment of leave,
separation of employee etc.
(iii) Non-current and current other provisions include:
(a) provision for compensatory afforestation, mine closure and rehabilitation obligations `791.62 crore (March 31, 2018: `626.01 crore).
These amounts become payable upon closure of the mines and are expected to be incurred over a period of 1 to 33 years.
(b) provision for legal and constructive commitments provided by the Company in respect of a loss making subsidiary `47.33 crore
(March 31, 2018: `50.33 crore). The same is expected to be settled within one year from the reporting date.
(iv) The details of movement in other provisions is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 676.34 664.71
Recognised/(released) during the year (i) 190.91 96.88
Utilised during the year (28.30) (85.25)
Balance at the end of the year 838.95 676.34
(i) includes provisions capitalised during the year in respect of restoration obligations.
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Retiring gratuities 80.21 60.97
(b) Post-retirement medical benefits 1,182.12 1,119.32
(c) Other defined benefits 168.02 67.44
1,430.35 1,247.73
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Post-retirement medical benefits 88.89 85.38
(b) Other defined benefits 13.23 5.12
102.12 90.50
(i) Detailed disclosure in respect post-retirement defined benefit schemes is provided in note 35, page 269.
(ii) Other defined benefits include post-retirement lumpsum benefits, long service awards, packing and transportation, farewell gifts etc.
NOTES
forming part of the financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Grants relating to property, plant and equipment 747.23 1,365.61
(i) Grants relating to property, plant and equipment relate to duty saved on import of capital goods and spares under the EPCG scheme.
Under the scheme, the Company is committed to export prescribed times of the duty saved on import of capital goods over a specified period
of time. In case such commitments are not met, the Company would be required to pay the duty saved along with interest to the regulatory
authorities. Such grants recognised are released to the statement of profit and loss based on fulfilment of related export obligations.
During the year, an amount of `618.38 crore (2017-18: `519.31 crore) was released from deferred income to the statement of profit and
loss on fulfilment of export obligations.
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Statutory dues 19.77 35.47
(b) Other credit balances 416.39 189.24
436.16 224.71
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Advances received from customers 484.99 363.82
(b) Employee recoveries and employer contributions 70.22 59.54
(c) Statutory dues 5,810.38 5,433.70
6,365.59 5,857.06
(i) Statutory dues primarily relate to payables in respect of GST, excise duty, service tax, sales tax, VAT, tax deducted at source and royalties.
263
STANDALONE
NOTES
forming part of the financial statements
B. Total outstanding dues of creditors other than micro and small enterprises
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Creditors for supplies and services 8,995.84 9,724.05
(b) Creditors for accrued wages and salaries 1,824.23 1,493.22
10,820.07 11,217.27
(i) Amount due to micro and small enterprises as defined in the “The Micro, Small and Medium Enterprises Development Act, 2006” has
been determined to the extent such parties have been identified on the basis of information available with the Company. The disclosures
relating to micro and small enterprises is as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
(i) Principal amount remaining unpaid to supplier at the end of the year 149.49 25.48
(ii) Interest due thereon remaining unpaid to supplier at the end of the year 3.55 1.24
(iii) Amount of interest due and payable for the period of delay in making payment (which have been 8.09 5.58
paid but beyond the appointed day during the year) but without adding the interest specified
under this Act
(iv) Amount of interest accrued during the year and remaining unpaid at the end of the year 11.64 6.82
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Sale of products 67,213.85 57,614.48
(b) Sale of power and water 1,709.51 1,690.60
(c) Other operating revenues (ii) 1,687.56 1,214.29
70,610.92 60,519.37
NOTES
forming part of the financial statements
(i) Revenue from contracts with customers disaggregated on the basis of geographical region and major businesses is as below:
(` crore)
Year ended March 31, 2019
India Outside India Total
(a) Steel 58,777.12 4,342.26 63,119.38
(b) Power and water 1,709.51 - 1,709.51
(c) Others 1,801.94 2,292.53 4,094.47
62,288.57 6,634.79 68,923.36
(` crore)
Year ended March 31, 2018
India Outside India Total
(a) Steel 49,715.06 4,026.72 53,741.78
(b) Power and water 1,690.60 - 1,690.60
(c) Others 1,818.22 2,054.48 3,872.70
53,223.88 6,081.20 59,305.08
(ii) Other operating revenues include export incentives and deferred income released to the statement of profit and loss on fulfilment of
export obligations under the EPCG scheme.
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Dividend income 96.25 88.57
(b) Interest income 1,627.24 69.56
(c) Net gain/(loss) on sale/fair value changes of mutual funds 596.79 679.64
(d) Gain/(loss) on sale of property, plant and equipment including intangible assets (net of loss on (1.42) (40.48)
assets sold/scrapped/written off )
(e) Gain/(loss) on cancellation of forwards, swaps and options 36.95 (79.33)
(f ) Other miscellaneous income 49.27 45.70
2,405.08 763.66
(i)
Dividend income includes income from investments carried at fair value through other comprehensive income `18.25 crore
(2017-18: `17.20 crore).
(ii) Interest income includes:
(a) income on financial assets carried at amortised cost `874.36 crore (2017-18: `61.06 crore).
(b) income on financial assets carried at fair value through profit and loss `752.88 crore (2017-18: `8.50 crore).
265
STANDALONE
NOTES
forming part of the financial statements
28. Changes in inventories of finished and semi-finished goods, stock-in-trade and work-in-progress
[Item No. IV(c), Page 211]
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Inventories at the end of the year
(a) Work-in-progress 14.54 6.77
(b) Finished and semi-finished goods 4,129.28 3,602.13
(c) Stock-in-trade 75.54 56.13
4,219.36 3,665.03
Inventories at the beginning of the year
(a) Work-in-progress 6.77 5.88
(b) Finished and semi-finished goods 3,602.13 4,096.56
(c) Stock-in-trade 56.13 107.95
3,665.03 4,210.39
Increase/(decrease) 554.33 (545.36)
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Salaries and wages 4,306.68 4,130.68
(b) Contribution to provident and other funds 473.94 446.75
(c) Staff welfare expenses 350.44 251.42
5,131.06 4,828.85
(i) During the year ended March 31, 2019, the Company has recognised an amount of `27.06 crore (2017-18: `19.04 crore) as remuneration
to key managerial personnel. The details of such remuneration is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Short-term employee benefits 22.05 19.03
(b) Post-employment benefits 4.88 (0.02)
(c) Other long-term employee benefits 0.13 0.03
27.06 19.04
NOTES
forming part of the financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Interest expense on:
(a) Bonds, debentures, bank borrowings and others 2,644.94 2,547.68
(b) Finance leases 267.32 338.90
2,912.26 2,886.58
Less: Interest capitalised 88.68 75.96
2,823.58 2,810.62
(i) Other interest expense include interest on income tax Nil (2017-18: `5.85 crore).
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Depreciation on property, plant and equipment 3,652.67 3,585.44
(b) Amortisation of intangible assets 150.29 142.02
3,802.96 3,727.46
267
STANDALONE
NOTES
forming part of the financial statements
(i) Others include: net foreign exchange loss `134.41 crore (2017-18: gain `122.31 crore), loss on fair value changes of financial assets
carried at fair value through profit and loss `111.31 crore (2017-18: gain of `387.93 crore) and donations to electoral trusts `175.00 crore
(2017-18: Nil).
(ii) Details of auditors’ remuneration and out-of-pocket expenses is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Auditors remuneration and out-of-pocket expenses
(i) Statutory audit fees 6.18 4.75
(ii) Tax audit fees 0.40 0.40
(iii) For other services# 0.74 0.60
(iv) Out-of-pocket expenses 0.12 0.25
(b) Cost audit fees [including out of pocket expenses `6,936 (2017-18: `32,206)] 0.18 0.18
#
Other services includes Nil (2017-18: `0.45 crore) in respect of rights issue which has been charged to securities premium.
(iii) As per the Companies Act, 2013, amount required to be spent by the Company on Corporate Social Responsibility (CSR) activities during
the year was `82.40 crore (2017-18: `85.62 crore).
During the year ended March 31, 2019, in respect of CSR activities the Company incurred revenue expenditure which was recognised in the
statement of profit and loss amounting to `271.62 crore (`270.12 crore has been paid in cash and `1.50 crore is yet to be paid). During the
year ended March 31, 2018, similar expense incurred was `189.96 crore (`188.96 crore was paid in cash and `1.00 crore was unpaid).
During the year ended March 31, 2019, capital expenditure incurred on construction of capital assets under CSR projects is `43.32 crore
(`30.92 crore paid in cash and `12.40 crore is yet to be paid). During the year ended March 31, 2018, similar expense incurred was `41.66
crore (`24.25 crore was paid in cash and `17.41 crore was unpaid).
(iv) During the year ended March 31, 2019, revenue expenditure charged to the statement of profit and loss in respect of research and
development activities undertaken was `212.97 crore (2017-18: `159.22 crore) including depreciation of `7.80 crore (2017-18: `7.67 crore).
Capital expenditure incurred in respect of research and development activities during the year was `21.45 crore (2017-18: `22.42 crore).
NOTES
forming part of the financial statements
The following table reflects the profit and shares data used in the computation of basic and diluted earnings per share (EPS).
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Profit after tax 10,533.19 4,169.55
Less: Distribution on hybrid perpetual securities (net of tax) 173.13 173.43
Profit attributable to ordinary shareholders- for basic and diluted EPS 10,360.06 3,996.12
Nos. Nos.
(b) Weighted average number of Ordinary Shares for basic EPS 1,14,59,26,020 1,03,61,99,628
Add: Adjustment for shares held in abeyance 1,37,496 1,55,646
Weighted average number of Ordinary Shares and potential Ordinary Shares for diluted EPS 1,14,60,63,516 1,03,63,55,274
(c) Nominal value of Ordinary Share (`) 10.00 10.00
(i) As at March 31, 2019, 5,81,95,359 options (March 31, 2018: 28,69,886) in respect of partly paid shares were excluded from weighted
average number of Ordinary Shares for the computation of diluted earnings per share as these were anti-dilutive.
35. Employee benefits Benefits provided under plans wherein contributions are made
to state managed funds and the Company does not have a future
A. Defined contribution plans obligation to make good shortfall if any, is treated as a defined
The Company participates in a number of defined contribution plans contribution plan.
on behalf of relevant personnel. Any expense recognised in relation
to these schemes represents the value of contributions payable (b) Superannuation fund
during the period by the Company at rates specified by the rules The Company has a superannuation plan for the benefit of its
of those plans. The only amounts included in the balance sheet are employees. Employees who are members of the superannuation
those relating to the prior months contributions that were not due to plan are entitled to benefits depending on the years of service
be paid until after the end of the reporting period. and salary drawn.
The major defined contribution plans operated by the Separate irrevocable trusts are maintained for employees
Company are as below: covered and entitled to benefits. The Company contributes up to
15% of the eligible employees’ salary or `1,50,000, whichever is
(a) Provident fund and pension lower, to the trust every year. Such contributions are recognised
The Company provides provident fund benefits for eligible as an expense as and when incurred. The Company does not
employees as per applicable regulations wherein both have any further obligation beyond this contribution.
employees and the Company make monthly contributions
The contributions recognised as an expense in the statement of
at a specified percentage of the eligible employee’s salary.
profit and loss during the year on account of the above defined
Contributions under such schemes are made either to a
contribution plans amounted to `191.18 crore (2017-18:
provident fund set up as an irrevocable trust by the Company to
`145.40 crore).
manage the investments and distribute the amounts entitled to
employees or to state managed funds.
269
STANDALONE
NOTES
forming part of the financial statements
NOTES
forming part of the financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Change in defined benefit obligations:
Obligation at the beginning of the year 2,767.69 2,779.95
Current service cost 124.76 129.90
Interest cost 186.50 185.47
Remeasurement (gain)/loss (3.93) (154.45)
Adjustment for arrear wage settlement - 87.55
Benefits paid (235.36) (260.73)
Obligation at the end of the year 2,839.66 2,767.69
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Change in plan assets:
Fair value of plan assets at the beginning of the year 2,706.72 2,562.92
Interest income 196.53 177.82
Remeasurement gain/(loss) excluding amount included within employee benefits expense 28.94 11.33
Employers' contribution 62.63 215.38
Benefits paid (235.37) (260.73)
Fair value of plan assets at the end of the year 2,759.45 2,706.72
(` crore)
As at As at
March 31, 2019 March 31, 2018
Fair value of plan assets 2,759.45 2,706.72
Present value of obligations (2,839.66) (2,767.69)
(80.21) (60.97)
Recognised as:
Retirement benefit obligations - Non-current (80.21) (60.97)
271
STANDALONE
NOTES
forming part of the financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Employee benefits expense:
Current service cost 124.76 129.90
Net interest expense (10.03) 7.65
114.73 137.55
(%)
As at As at
March 31, 2019 March 31, 2018
Assets category (%)
Equity instruments (quoted) 0.05 -
Debt instruments (quoted) 18.93 21.26
Insurance products (unquoted) 81.02 78.74
100.00 100.00
The Company’s investment policy is driven by considerations of maximising returns while ensuring credit quality of debt instruments. The asset
allocation for plan assets is determined based on prescribed investment criteria and is also subject to other exposure limitations. The Company
evaluates the risks, transaction costs and liquidity for potential investments. To measure plan assets performance, the Company compares
actual returns for each asset category with published benchmarks.
(iii) Key assumptions used in the measurement of retiring gratuity is as below:
As at As at
March 31, 2019 March 31, 2018
Discount rate 7.50% 7.50%
Rate of escalation in salary 7.50% to 10.00% 7.50% to 10.00%
(iv) Weighted average duration of the retiring gratuity obligation is 9 years (March 31, 2018: 9 years).
(v) The Company expects to contribute `80.21 crore to the plan during the financial year 2019-20.
NOTES
forming part of the financial statements
(vi) The table below outlines the effect on retiring gratuity obligation in the event of a decrease/increase of 1% in the assumptions used.
273
STANDALONE
NOTES
forming part of the financial statements
(` crore)
As at March 31, 2019 As at March 31, 2018
Medical Others Medical Others
Present value of obligations (1,271.01) (181.25) (1,204.70) (72.56)
Recognised as:
Retirement benefit obligations - Current (88.89) (13.23) (85.38) (5.12)
Retirement benefit obligations - Non-current (1,182.12) (168.02) (1,119.32) (67.44)
Expense recognised in the statement of profit and loss 130.16 116.33 43.91 (23.07)
(ii) Key assumptions used in the measurement of post-retirement medical benefits and other defined benefit plans is as below:
(iii) Weighted average duration of post-retirement medical benefit obligation is 8 years (March 31, 2018: 8 years). Weighted average duration
of other defined benefit obligation ranges from 3.6 to 12 years (March 31, 2018: 8 to 10 years)
NOTES
forming part of the financial statements
(iv) The table below outlines the effect on post-retirement medical benefit obligation in the event of a decrease/increase of 1% in the
assumptions used:
275
STANDALONE
NOTES
forming part of the financial statements
36. Contingencies and commitments assessments with tax demand raised for `1,791.29 crore
(inclusive of interest) (March 31, 2018: `1,250.16 crore).
A. Contingencies
In the ordinary course of business, the Company faces claims (b) Interest expenditure on “Hybrid perpetual securities” has
and assertions by various parties. The Company assesses such been disallowed in assessments with tax demand raised for
claims and assertions and monitors the legal environment on `459.13 crore (inclusive of interest) (March 31, 2018: Nil)
an on-going basis with the assistance of external legal counsel, In respect of above demands, the Company has deposited an
wherever necessary. The Company records a liability for any amount of `1,065.00 crore (March 31, 2018: `665.00 crore) as a
claims where a potential loss is probable and capable of being precondition for obtaining stay. The Company expects to sustain
estimated and discloses such matters in its financial statements, its position on ultimate resolution of the said appeals.
if material. For potential losses that are considered possible, but
not probable, the Company provides disclosure in the financial Customs, excise duty and service tax
statements but does not record a liability in its accounts unless As at March 31, 2019, there were pending litigations for
the loss becomes probable. various matters relating to customs, excise duty and service
The following is a description of claims and assertions where taxes involving demands of `682.53 crore (March 31, 2018:
a potential loss is possible, but not probable. The Company `669.48 crore).
believes that none of the contingencies described below would
Sales tax/VAT
have a material adverse effect on the Company’s financial
condition, results of operations or cash flows. The total sales tax demands that are being contested by
the Company amounted to `717.02 crore (March 31, 2018:
It is not practicable for the Company to estimate the timings of `567.85 crore).
the cash outflows, if any, pending resolution of the respective
proceedings. The Company does not expect any reimbursements The details of demands for more than `100 crore is as below:
in respect of the same. (a)
The Company stock transfers its goods manufactured at
Jamshedpur works plant to its various depots/branches located
Litigations
outside the state of Jharkhand across the country without
The Company is involved in legal proceedings, both as plaintiff payment of Central Sales Tax as per the provisions of the Act
and as defendant. There are claims which the Company and submits F-Form in lieu of the stock-transfers made during
does not believe to be of a material nature, other than those the period of assessment. These goods are then sold to various
described below. customers outside the states from depots/branches and the
value of these sales are disclosed in the periodical returns
Income tax
filed as per the Jharkhand Vat Act 2005. The Commercial Tax
The Company has ongoing disputes with income tax authorities Department has raised demand of Central Sales tax by levying
relating to tax treatment of certain items. These mainly tax on the differences between value of sales outside the states
include disallowance of expenses, tax treatment of certain and value of F-Form submitted for stock transfers. The amount
expenses claimed by the Company as deduction and the involved for various assessment years beginning 2011-12
computation of or eligibility of the Company’s use of certain tax to 2015-16 is amounting to `127.00 crore (March 31, 2018:
incentives or allowances. `125.00 crore).
Most of these disputes and/or disallowances, being repetitive (b) The Commercial Tax Department of Jharkhand has rejected
in nature, have been raised by the income tax authorities certain Input tax credit claimed by the Company on goods
consistently in most of the years. purchased from the suppliers within the State of Jharkhand.
As at March 31, 2019, there are matters and/or disputes pending The Department has alleged that the goods have not been
in appeals amounting to `3,160.64 crore (March 31, 2018: used in accordance with the provisions of Jharkhand VAT Act,
`1,443.29 crore). 2005. The potential exposure on account of disputed tax and
interest for the period beginning 2012-2013 to 2015-2016 as on
The details of demands for more than `100 crore is as below: March 31, 2019 is `104.00 crore (March 31,2018: `93.00 crore).
(a)
Interest expenditure on loans taken by the Company
for acquisition of a subsidiary has been disallowed in
NOTES
forming part of the financial statements
36. Contingencies and commitments (Contd.) under Section 21(5) of the Mines and Minerals (Development
and Regulations) Act (MMDR). The Company filed revision
Other taxes, dues and claims petitions before the Mines Tribunal against all such demand
Other amounts for which the Company may contingently notices. Initially, a stay of demands was granted, later by order
be liable aggregate to `11,639.19 crore (March 31, 2018: dated October 12, 2017, the issue has been remanded to the
`9,925.20 crore). state for reconsideration of the demand in the light of Supreme
Court judgement passed on August 2, 2017.
The details of demands for more than `100 crore are as below:
The Hon’ble Supreme Court pronounced its judgement in the
(a) Claim by a party arising out of conversion arrangement `195.79 Common Cause case on August 2, 2017 wherein it directed that
crore (March 31, 2018: `195.79 crore). The Company has not compensation equivalent to the price of mineral extracted in
acknowledged this claim and has instead filed a claim of `141.23 excess of environment clearance or without forest clearance
crore (March 31, 2018: `141.23 crore) on the party. The matter is from the forest land be paid.
pending before the Calcutta High Court.
In pursuance to the Judgement of Hon’ble Supreme Court,
(b)
The State Government of Odisha introduced “Orissa Rural demand/show cause notices amounting to `3,873.35 crore have
Infrastructure and Socio Economic Development Act, 2004” been issued during 2017-18 by the Deputy Director of Mines,
with effect from February 2005 levying tax on mineral bearing Odisha and the District Mining Office, Jharkhand.
land computed on the basis of value of minerals produced from
the mineral bearing land. The Company had filed a writ petition In respect of the above demands:
in the High Court of Orissa challenging the validity of the Act. • as directed by the Hon’ble Supreme Court, the Company
Orissa High Court held in December 2005 that the State does not has provided and paid for iron ore and manganese ore an
have authority to levy tax on minerals. The State of Odisha filed amount of `614.41 crore during 2017-18 for production in
an appeal in the Supreme Court against the order of Orissa High excess of environment clearance to the Deputy Director
Court and the case is pending in Supreme Court. The potential of Mines, Odisha.
liability, as at March 31, 2019 is `7,573.53 crore (March 31, 2018:
`6,521.05 crore). • the Company has provided and paid under protest an
amount of `56.97 crore during 2017-18 for production in
(c) The Company pays royalty on iron ore on the basis of quantity excess of environment clearance to the District Mining
removed from the leased area at the rates based on notification Office, Jharkhand.
issued by the Ministry of Mines, Government of India and
the price published by Indian Bureau of Mines (IBM) on • the Company has challenged the demands amounting to
a monthly basis. `132.91 crore during 2017-18 for production in excess of
lower of mining plan and consent to operate limits raised
Demand of `411.08 crore has been raised by Deputy Director of by the Deputy Director of Mines, Odisha before the Mines
Mines, Joda, claiming royalty at sized ore rates on despatches Tribunal and obtained a stay on the matter. Mines Tribunal,
of ore fines. The Company has filed a revision petition on Delhi vide order dated November 26, 2018 disposed of all
November 14, 2013 before the Mines Tribunal, Government of the revision applications with a direction to remand it to
India, Ministry of Mines, New Delhi, challenging the legality and the State Government to hear all such cases afresh and pass
validity of the demand raised and to grant refund of royalty paid detailed order. The demand amount of `132.91 crore is
in excess by the Company. Mines Tribunal has granted stay on considered contingent.
the total demand with directive to Government of Odisha not
to take any coercive action for realisation of this demanded • the Company has made a comprehensive submission before
amount. Likely demand of royalty on fines at sized ore rates the Deputy Director of Mines, Odisha against show cause
as on March 31, 2019 is `1,630.16 crore (March 31, 2018: notices amounting to `694.02 crore received during 2017-18
`1,036.53 crore). for production in violation of mining plan, Environment
Protection Act, 1986 and Water (Prevention and Control of
(d) Demand notices were originally issued by the Deputy Director Pollution) Act, 1981. A demand amounting to `234.74 crore
of Mines, Odisha amounting to `3,827.29 crore for excess has been received in April 2018 from the Deputy Director of
production over the quantity permitted under the mining Mines, Odisha for production in excess of the Environmental
plan, environment clearance or consent to operate, pertaining Clearance. The Company has challenged the demand
to 2000-01 to 2009-10. The demand notices have been raised and obtained a stay on the matter from the Revisionary
277
STANDALONE
NOTES
forming part of the financial statements
36. Contingencies and commitments (Contd.) minimal stake required to be able to provide a corporate
guarantee towards long-term debt)
Authority, Mines Tribunal, New Delhi. The demand of
(iv) ICICI Bank Limited to directly or indirectly continue to
`234.74 crore has been provided and `694.02 crore is
hold atleast 51 % shareholding in Jamshedpur Continuous
considered contingent.
Annealing & Processing Company Private Limited.
• The Company based on its internal assessment has provided (c)
The Company and BlueScope Steel Limited have given
an amount of `1,412.89 crore against demand notices
undertaking to State Bank of India not to reduce collective
amounting to `2,140.30 crore received from the District
shareholding in Tata BlueScope Steel Private Limited (TBSPL)
Mining Office, Jharkhand during 2017-18 for production in
(formerly Tata BlueScope Steel Limited), below 51% without
excess of environment clearance. The balance amount of
prior consent of the lender. Further, the Company has given
`727.41 crore is considered contingent. The Company has
an undertaking to State Bank of India to intimate them before
however been granted a stay by the Revisional Authority,
diluting its shareholding in TBSPL below 50%.
Ministry of Coal, Government of India against such
demand notices. (d) The Company, as a promoter, has pledged 4,41,55,800 (March 31,
2018: 4,41,55,800) equity shares of Industrial Energy Limited
(e)
An agreement was executed between the Government
with Infrastructure Development Finance Corporation Limited.
of Odisha (GoO) and the Company in December, 1992 for
drawal of water from Kundra Nalla for industrial consumption. (e) The Company has agreed, if requested by Tata Steel UK Holdings
In December 1993, the Tahsildar, Barbil issued a show-cause Limited (TSUKH) (an indirect wholly owned subsidiary), to
notice alleging that the Company has lifted more quantity of procure an injection of funds to reduce the outstanding net
water than the sanctioned limit under the agreement. debt in TSUKH and its subsidiaries, to a mutually accepted level.
While the proceedings in this regard were in progress, the (f ) The Company has given guarantees aggregating `12,096.24
Company had applied for allocation of fresh limits. crore (2018: `11,478.00 crore) details of which are as below:
Over the years, there has also been a steep increase in the water (i)
in favour of Commissioner of Customs `1.07 crore
charges against which the Company filed writ petitions before (March 31, 2018: `1.07 crore) given on behalf of Timken
the Hon’ble High Court of Odisha. In this regard, the Company India Limited in respect of goods imported.
has received demands of `118.70 crore for the period beginning
(ii) in favour of Mizuho Corporate Bank Ltd., Japan for `9.60
January 1996 to December 2018. The potential exposure as on
crore (March 31, 2018: `27.33 crore) against the loan
March 31, 2019 is `125.98 crore (March 31, 2018: `99.34 crore)
granted to a joint venture Tata NYK Shipping Pte. Limited.
is considered contingent.
(iii)
in favour of The President of India for `177.18 crore
B. Commitments (March 31, 2018: `177.18 crore) against performance
(a) The Company has entered into various contracts with suppliers of export obligation under the various bonds executed
and contractors for the acquisition of plant and machinery, by a joint venture Jamshedpur Continuous Annealing &
equipment and various civil contracts of capital nature Processing Company Private Limited.
amounting to `7,265.82 crore (March 31, 2018: `4,275.79 crore).
(iv) in favour of the note holders against due and punctual
Other commitments as at March 31, 2019 amount to `0.01 crore repayment of the 100% amounts outstanding as on
(March 31, 2018: `0.01 crore). March 31, 2019 towards issued Guaranteed Notes by a
subsidiary, ABJA Investment Co. Pte Ltd. for `10,376.63
(b) The Company has given undertakings to:
crore (March 31, 2018: `9,777.37 crore) and `1,531.61 crore
(i)
IDBI not to dispose of its investment in Wellman (March 31, 2018: `1,494.90 crore). The guarantee is capped
Incandescent India Ltd. at an amount equal to 125% of the outstanding principal
amount of the Notes as detailed in “Terms and Conditions”
(ii) IDBI and ICICI Bank Ltd. (formerly ICICI) not to dispose of its
of the Offering Memorandum.
investment in Standard Chrome Ltd.
(v) In favour of President of India for `0.15 crore (March 31,
(iii)
Mizuho Corporate Bank Limited and Japan Bank
2018: `0.15 crore) against advance license.
for International Co-operation, not to dispose of its
investments in Tata NYK Shipping Pte Limited (to retain
NOTES
forming part of the financial statements
37. Other significant litigations The mining operations were suspended from August 1, 2014.
(a) Odisha Legislative Assembly issued an amendment to Indian Upon issuance of an express order, the Company paid `152.00
Stamp Act, 1889, on May 9, 2013 and inserted a new provision crore under protest, so that mining can be resumed.
(Section 3A) in respect of stamp duty payable on grant/renewal The Mines and Minerals Development and Regulation (MMDR)
of mining leases. As per the amended provision, stamp duty is Amendment Ordinance 2015 promulgated on January 12, 2015
levied equal to 15% of the average royalty that would accrue provides for extension of such mining leases whose applications
out of the highest annual extraction of minerals under the for renewal have remained pending with the State(s). Based on
approved mining plan multiplied by the period of such mining the new Ordinance, Jharkhand Government revised the Express
lease. The Company had filed a writ petition challenging the Order on February 12, 2015 for extending the period of lease up
constitutionality of the Act on July 5, 2013. The Hon’ble High to March 31, 2030 with the following terms and conditions:
Court, Cuttack passed an order on July 9, 2013 granting interim
stay on the operation of the Amendment Act, 2013. Because of • value of iron ore produced by alleged unlawful mining during
the stay, as on date, the Act is not enforceable and any demand the period January 1, 2012 to April 20, 2014 for `2,994.49 crore
received by the Company is not liable to be proceeded with. to be decided on the basis of disposal of our writ petition
Meanwhile, the Company received demand notices for the before Hon’ble High Court of Jharkhand.
various mines at Odisha totalling to `5,579.00 crore (March 31, • value of iron ore produced from April 21, 2014 to
2018: `5,579.00 crore). The Company has concluded that it is July 17, 2014 amounting to `421.83 crore to be paid in
remote that the claim will sustain on ultimate resolution of the maximum 3 instalments.
legal case by the court.
• value of iron ore produced from July 18, 2014 to August 31,
In April 2015, the Company has received an intimation from 2014 i.e. `152.00 crore to be paid immediately.
Government of Odisha, granting extension of validity period
for leases under the MMDR Amendment Act, 2015 up to District Mining Officer Chaibasa on March 16, 2015 issued a demand
March 31, 2030 in respect of eight mines and up to March 31, notice for payment of `421.83 crore, in three monthly instalments.
2020 for two mines subject to execution of supplementary lease The Company on March 20, 2015 replied that since the lease has been
deed. Liability has been provided in the books of accounts as extended by application of law till March 31, 2030, the above demand
on March 31, 2019 as per the existing provisions of the Stamp is not tenable. The Company, however, paid `50.00 crore under
Act 1899 and the Company had paid the stamp duty and protest on July 27, 2015, because the State had stopped issuance of
registration charges totalling `413.72 crore for supplementary transit permits.
deed execution in respect of eight mines out of the above mines. The Company filed another writ petition before the Hon’ble High
(b) Noamundi Iron Ore Mine of TSL was due for its third renewal Court of Jharkhand which was heard on September 9, 2015.
with effect from January 1, 2012. The application for renewal An interim order was given by the Hon’ble High Court of Jharkhand
was submitted by the Company within the stipulated time, but it on September 2015 wherein the Court has directed the Company
remained pending consideration with the State and the mining to pay the amount of `371.83 crore in 3 equal instalments, first
operations were continued in terms of the prevailing law. instalment by October 15, 2015, second instalment by November 15,
2015 and third instalment by December 15, 2015.
By a judgement of April 2014 in the case of Goa mines, the
Supreme Court took a view that second and subsequent renewal In view of the interim order of the Hon’ble High Court of Jharkhand
of mining lease can be effected once the State considers the `124.00 crore was paid on September 28, 2015, `124.00 crore
application and decides to renew the mining lease by issuing on November 12, 2015 and `123.83 crore on December 14,
an express order. State of Jharkhand issued renewal order to 2015 under protest.
the Company on December 31, 2014. The State, however, took The case is pending at Hon’ble High court for disposal. The State
a view on interpretation of Goa judgement that the mining issued similar terms and conditions to other mining lessees in
carried out after expiry of the period of second renewal was the State rendering the mining as illegal. Based on the Company’s
‘illegal’ and hence, issued a demand notice of `3,568.31 crore assessment of the Goa mines judgement read with the Ordinance
being the price of iron ore extracted. The said demand has been issued in the year 2015, the Company believes that it is remote that
challenged by the Company before the Jharkhand High Court. the demand of the State would sustain.
279
STANDALONE
NOTES
forming part of the financial statements
The Company determines the amount of capital required on the basis of annual business plan coupled with long-term and short-term strategic
investment and expansion plans. The funding needs are met through equity, cash generated from operations, long-term and short-term bank
borrowings and issue of non-convertible debt securities.
The Company monitors the capital structure on the basis of net debt to equity ratio and maturity profile of the overall debt portfolio
of the Company.
Net debt includes interest bearing borrowings less cash and cash equivalents, other bank balances (including non-current and earmarked
balances) and current investments.
The table below summarises the capital, net debt and net debt to equity ratio of the Company.
(` crore)
As at As at
March 31, 2019 March 31, 2018
Equity share capital 1,146.12 1,146.12
Hybrid perpetual securities 2,275.00 2,275.00
Other equity 69,308.59 60,368.72
Total equity (A) 72,729.71 63,789.84
NOTES
forming part of the financial statements
(` crore)
Amortised Fair value Derivative Derivative Fair value Total Total fair
cost through other instruments instruments through profit carrying value
comprehensive in hedging not in hedging and loss value
income relationship relationship
Financial assets:
Cash and bank balances 753.07 - - - - 753.07 753.07
Trade receivables 1,363.04 - - - - 1,363.04 1,363.04
Investments - 751.95 - - 34,217.01 34,968.96 34,968.96
Derivatives - - 1.27 22.74 - 24.01 24.01
Loans 287.08 - - - - 287.08 287.08
Other financial assets 1,216.45 - - - - 1,216.45 1,216.45
3,619.64 751.95 1.27 22.74 34,217.01 38,612.61 38,612.61
Financial liabilities:
Trade payables 10,969.56 - - - - 10,969.56 10,969.56
Borrowings 29,701.47 - - - - 29,701.47 29,543.97
Derivatives - - 3.83 195.56 - 199.39 199.39
Other financial liabilities 3,955.23 - - - - 3,955.23 3,955.23
44,626.26 - 3.83 195.56 - 44,825.65 44,668.15
281
STANDALONE
NOTES
forming part of the financial statements
(` crore)
Amortised Fair value Derivative Derivative Fair value Total Total fair
cost through other instruments instruments through profit carrying value
comprehensive in hedging not in hedging and loss value
income relationship relationship
Financial assets:
Cash and bank balances 4,716.70 - - - - 4,716.70 4,716.70
Trade receivables 1,875.63 - - - - 1,875.63 1,875.63
Investments - 807.55 - - 19,803.14 20,610.69 20,610.69
Derivatives - - 7.90 34.30 - 42.20 42.20
Loans 287.63 - - - - 287.63 287.63
Other financial assets 492.76 - - - - 492.76 492.76
7,372.72 807.55 7.90 34.30 19,803.14 28,025.61 28,025.61
Financial liabilities:
Trade payables 11,242.75 - - - - 11,242.75 11,242.75
Borrowings 28,125.80 - - - - 28,125.80 28,258.84
Derivatives - - - 86.49 - 86.49 86.49
Other financial liabilities 3,674.21 - - - - 3,674.21 3,674.21
43,042.76 - - 86.49 - 43,129.25 43,262.29
(i) Investments in mutual funds and derivative instruments (other than those designated in a hedging relationship) are mandatorily classified
as fair value through profit and loss.
NOTES
forming part of the financial statements
(` crore)
As at March 31, 2019
Level 1 Level 2 Level 3 Total
Financial assets:
Investment in mutual funds 477.47 - - 477.47
Investment in equity shares 448.61 - 303.34 751.95
Investment in debentures - 49.74 - 49.74
Investment in preference shares - - 33,689.80 33,689.80
Derivative financial assets - 24.01 - 24.01
926.08 73.75 33,993.14 34,992.97
Financial liabilities:
Derivative financial liabilities - 199.39 - 199.39
- 199.39 - 199.39
(` crore)
As at March 31, 2018
Level 1 Level 2 Level 3 Total
Financial assets:
Investment in mutual funds 14,640.37 - - 14,640.37
Investment in equity shares 497.21 - 310.34 807.55
Investment in debentures - 49.74 - 49.74
Investment in preference shares - - 5,113.03 5,113.03
Derivative financial assets - 42.20 - 42.20
15,137.58 91.94 5,423.37 20,652.89
Financial liabilities:
Derivative financial liabilities - 86.49 - 86.49
- 86.49 - 86.49
(i) Current financial assets and liabilities are stated at carrying value which is approximately equal to their fair value.
(ii) Derivatives are fair valued using market observable rates and published prices together with forecasted cash flow information
where applicable.
(iii) Investments carried at fair value are generally based on market price quotations. Investments included in Level 3 of the fair value hierarchy
have been valued using the cost approach to arrive at their fair value. Cost of unquoted equity instruments has been considered as an
appropriate estimate of fair value because of a wide range of possible fair value measurements and cost represents the best estimate of
fair value within that range. Fair value of investment in preference shares is estimated by discounting the expected future cash flows using
a discount rate equivalent to the expected rate of return for a similar instrument and maturity as on the reporting date.
(iv) Fair value of borrowings which have a quoted market price in an active market is based on its market price which is categorised as
Level 1. Fair value of borrowings which do not have an active market or are unquoted is estimated by discounting expected future cash
flows using a discount rate equivalent to the risk-free rate of return adjusted for credit spread considered by lenders for instruments of
similar maturities which is categorised as Level 2 in the fair value hierarchy.
(v) Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in
any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily
indicative of the amounts that the Company could have realised or paid in sale transactions as of respective dates. As such, fair value of
financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.
(vi) There have been no transfers between Level 1 and Level 2 for the years ended March 31, 2019 and March 31, 2018.
283
STANDALONE
NOTES
forming part of the financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Balance at the beginning of the year 5,423.37 486.16
Additions during the year 28,698.08 4,725.10
Sales/redemptions during the year - (100.00)
Reclassification within investments* (17.00) -
Fair value changes during the year (111.31) 312.11
Balance at the end of the year 33,993.14 5,423.37
* represents investment held in Subarnarekha Port Private Limited which became a subsidiary during the year.
(c) Derivative financial instruments
erivative instruments used by the Company include forward exchange contracts, interest rate swaps, currency swaps, options and interest
D
rate caps and collars. These financial instruments are utilised to hedge future transactions and cash flows and are subject to hedge accounting
under Ind AS 109 “Financial Instruments” wherever possible. The Company does not hold or issue derivative financial instruments for trading
purposes. All transactions in derivative financial instruments are undertaken to manage risks arising from underlying business activities.
The following table sets out the fair value of derivatives held by the Company as at the end of each reporting period:
(` crore)
As at March 31, 2019 As at March 31, 2018
Assets Liabilities Assets Liabilities
(i) Foreign currency forwards, swaps and options 19.93 199.32 34.44 86.49
(ii) Interest rate swaps and collars 4.08 0.07 7.76 -
24.01 199.39 42.20 86.49
Classified as:
Non-current 9.05 59.82 12.13 70.08
Current 14.96 139.57 30.07 16.41
As at the end of the reporting period total notional amount of outstanding foreign currency contracts, interest rate swaps and collars that the
Company has committed to is as below:
(US$ million)
As at As at
March 31, 2019 March 31, 2018
(i) Foreign currency forwards, swaps and options 1,148.92 1,322.86
(ii) Interest rate swaps and collars 150.00 150.00
1,298.92 1,472.86
NOTES
forming part of the financial statements
(e) Financial risk management The Company, as per its risk management policy, uses foreign
In the course of its business, the Company is exposed primarily exchange and other derivative instruments primarily to hedge
to fluctuations in foreign currency exchange rates, interest rates, foreign exchange and interest rate exposure. Any weakening
equity prices, liquidity and credit risk, which may adversely of the functional currency may impact the Company’s
impact the fair value of its financial instruments. cost of imports and cost of borrowings and consequently
may increase the cost of financing the Company’s capital
The Company has a risk management policy which not only expenditures. Such movements may also impact the fair value
covers the foreign exchange risks but also other risks associated of preference shares investments held by the Company in its
with the financial assets and liabilities such as interest rate risks foreign subsidiaries.
and credit risks. The risk management policy is approved by the
Board of Directors. The risk management framework aims to: A 10% appreciation/depreciation of foreign currencies with
respect to functional currency of the Company would result in
(i) create a stable business planning environment by reducing an increase/decrease in the Company’s net profit/equity before
the impact of currency and interest rate fluctuations on the considering tax impacts by approximately `1,352.48 crore for
Company’s business plan. the year ended March 31, 2019 (March 31, 2018: `514.89 crore)
(ii) achieve greater predictability to earnings by determining and an increase/decrease in carrying value of property, plant
the financial value of the expected earnings in advance. and equipment (before considering depreciation impact) by
approximately `31.87 crore as at March 31, 2019 (2017-18:
(i) Market risk: `148.81 crore).
Market risk is the risk of any loss in future earnings, in realisable The foreign exchange rate sensitivity is calculated by assuming
fair values or in future cash flows that may result from a a simultaneous parallel foreign exchange rates shift of
change in the price of a financial instrument. The value of a all the currencies by 10% against the functional currency
financial instrument may change as a result of changes in of the Company.
interest rates, foreign currency exchange rates, equity price
fluctuations, liquidity and other market changes. Future specific The sensitivity analysis has been based on the composition of
market movements cannot be normally predicted with the Company’s financial assets and liabilities as at March 31, 2019
reasonable accuracy. and March 31, 2018 excluding trade payables, trade receivables,
other derivative and non-derivative financial instruments
(a) Market risk - Foreign currency exchange rate risk: (except investment in preference shares) not forming part of
The fluctuation in foreign currency exchange rates may have a debt and which do not present a material exposure. The period
potential impact on the statement of profit and loss and equity, end balances are not necessarily representative of the average
where any transaction references more than one currency or debt outstanding during the period.
where assets/liabilities are denominated in a currency other
than the functional currency of the Company.
285
STANDALONE
NOTES
forming part of the financial statements
39. Disclosures on financial instruments (Contd.) The Company has a policy of dealing only with credit worthy
counter parties and obtaining sufficient collateral, where
(b) Market risk - Interest rate risk: appropriate as a means of mitigating the risk of financial
Interest rate risk is measured by using the cash flow sensitivity loss from defaults.
for changes in variable interest rates. Any movement in the
Financial instruments that are subject to credit risk and
reference rates could have an impact on the Company’s cash concentration thereof principally consist of trade receivables,
flows as well as costs. loans receivables, investments in debt securities and mutual
The Company is subject to variable interest rates on some of its funds, balances with banks, bank deposits, derivatives
interest bearing liabilities. The Company’s interest rate exposure and financial guarantees provided by the Company.
is mainly related to debt obligations. None of the financial instruments of the Company result in
material concentration of credit risk except preference shares
Based on the composition of debt as at March 31, 2019 and investments, the Company made in its subsidiary companies.
March 31, 2018 a 100 basis points increase in interest rates
would increase the Company’s finance costs (before considering The carrying value of financial assets represents the maximum
interest eligible for capitalisation) and thereby consequently credit risk. The maximum exposure to credit risk was
reduce net profit/equity before considering tax impacts by `37,584.12 crore and `27,217.13 crore, as at March 31, 2019
approximately `128.33 crore for the year ended March 31, 2019 and March 31, 2018 respectively, being the total carrying
(2017-18: `143.71 crore). value of trade receivables, balances with bank, bank deposits,
investments in debt securities, mutual funds, loans, derivative
The risk estimates provided assume a parallel shift of 100 basis assets and other financial assets.
points interest rate across all yield curves. This calculation also
assumes that the change occurs at the balance sheet date and has
The risk relating to trade receivables is presented in
been calculated based on risk exposures outstanding as at that note 13, page 248.
date. The period end balances are not necessarily representative The Company’s exposure to customers is diversified and no
of the average debt outstanding during the period. single customer contributes to more than 10% of outstanding
trade receivables as at March 31, 2019 and March 31, 2018.
(c) Market risk - Equity price risk:
Equity price risk is related to change in market reference price of In respect of financial guarantees provided by the Company
investments in equity securities held by the Company. to banks/financial institutions, the maximum exposure which
the Company is exposed to is the maximum amount which the
The fair value of quoted investments held by the Company Company would have to pay if the guarantee is called upon.
exposes the Company to equity price risks. In general, these Based on the expectation at the end of the reporting period, the
investments are not held for trading purposes. Company considers that it is more likely than not that such an
The fair value of quoted investments in equity, classified amount will not be payable under the guarantees provided.
as fair value through other comprehensive income as at
(iii) Liquidity risk:
March 31, 2019 and March 31, 2018 was `448.61 crore and
`497.21 crore, respectively. Liquidity risk refers to the risk that the Company cannot meet its
financial obligations. The objective of liquidity risk management
A 10% change in equity prices of such securities held as at is to maintain sufficient liquidity and ensure that funds are
March 31, 2019 and March 31, 2018, would result in an impact available for use as per requirements.
of `44.86 crore and `49.72 crore respectively on equity before
considering tax impact. The Company has obtained fund and non-fund based working
capital lines from various banks. Furthermore, the Company
(ii) Credit risk: has access to funds from debt markets through commercial
Credit risk is the risk of financial loss arising from counter-party paper programs, non-convertible debentures and other debt
failure to repay or service debt according to the contractual instruments. The Company invests its surplus funds in bank fixed
terms or obligations. Credit risk encompasses both the direct deposits and in mutual funds, which carry no or low market risk.
risk of default and the risk of deterioration of credit worthiness
as well as concentration risks.
NOTES
forming part of the financial statements
The following table shows a maturity analysis of the anticipated cash flows including interest obligations for the Company’s derivative and
non-derivative financial liabilities on an undiscounted basis, which therefore differ from both carrying value and fair value. Floating rate
interest is estimated using the prevailing interest rate at the end of the reporting period. Cash flows in foreign currencies are translated using
the period end spot rates.
(` crore)
As at March 31, 2019
Carrying Contractual less than between one to five More than
value cash flows one year years five years
Non-derivative financial liabilities:
Borrowings including interest obligations 30,270.83 48,006.81 5,388.10 18,284.95 24,333.76
Trade payables 10,969.56 10,969.56 10,969.56 - -
Other financial liabilities 3,385.87 3,385.88 3,260.81 15.47 109.60
44,626.26 62,362.25 19,618.47 18,300.42 24,443.36
(` crore)
As at March 31, 2018
Carrying Contractual less than between one to More than
value cash flows one year five years five years
Non-derivative financial liabilities:
Borrowings including interest obligations 28,681.81 42,886.90 5,574.30 17,766.50 19,546.10
Trade payables 11,242.75 11,242.75 11,242.75 - -
Other financial liabilities 3,118.20 3,118.21 3,098.43 5.00 14.78
43,042.76 57,247.86 19,915.48 17,771.50 19,560.88
287
STANDALONE
NOTES
forming part of the financial statements
NOTES
forming part of the financial statements
Finance provided during the year (net of repayments) 29,349.55 250.00 134.91 - 29,734.46
4,772.42 - 46.82 - 4,819.24
Provision for outstanding loans and receivables 651.00 0.03 7.46 0.02 658.51
668.78 0.03 5.49 - 674.30
289
STANDALONE
NOTES
forming part of the financial statements
42. The Company is in the process of evaluating the impact of the recent Supreme Court Judgement in case of “Vivekananda Vidyamandir and
Others Vs The Regional Provident Fund Commissioner (II) West Bengal” and the related circular (Circular No. CI/ 1(33)2019/Vivekananda
Vidya Mandir/284) dated March 20, 2019 issued by the Employees’ Provident Fund Organisation in relation to non-exclusion of certain
allowances from the definition of “basic wages” of the relevant employees for the purposes of determining contribution to provident fund
under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. In the assessment of the management which is supported
by legal opinion, the aforesaid matter is not likely to have a significant impact and accordingly no provision has been considered in the
financial statements.
43. The Board of Directors of the Company have considered and approved a merger of Bamnipal Steel Limited and Tata Steel BSL Limited
(formerly Bhushan Steel Limited) into the Company by way of a composite scheme of amalgamation and have recommended a merger
ratio of 1 equity share of `10/-each fully paid up of the Company for every 15 equity shares of `2/- each fully paid up held by the public
shareholders of Tata Steel BSL Limited. As part of the scheme, the equity shares held by Bamnipal Steel Limited and the preference shares
held by the Company in Tata Steel BSL Limited shall stand cancelled. The equity shares held by the Company in Bamnipal Steel Limited
shall also stand cancelled. The merger is subject to shareholders and other regulatory approvals.
NOTES
forming part of the financial statements
44. Details of significant investments in subsidiaries, associates and joint ventures (Contd.)
(% direct holding)
Country of As at As at
incorporation March 31, 2019 March 31, 2018
(24) Tata Korf Engineering Services Ltd India 100.00 100.00
(25) The Tata Pigments Limited India 100.00 100.00
(26) Tata Steel Foundation India 100.00 100.00
(27) T Steel Holdings Pte. Ltd. Singapore 100.00 100.00
(28) Tata Steel (KZN) (Pty) Ltd. South Africa 90.00 90.00
(29) Tata Steel Odisha Limited India 100.00 100.00
(30) Tata Steel Processing and Distribution Limited India 100.00 100.00
(31) Tata Steel Special Economic Zone Limited India 100.00 100.00
(32) T S Alloys Limited India 100.00 100.00
291
STANDALONE
NOTES
forming part of the financial statements
45. Dividend
The dividend declared by the Company is based on profits available for distribution as reported in the standalone financial statements of
the Company. On April 25, 2019, the Board of Directors of the Company have proposed a dividend of `13.00 per Ordinary Share of `10
each and `3.25 per partly paid Ordinary Share of `10 each (paid up `2.504 per share) in respect of the year ended March 31, 2019 subject
to the approval of shareholders at the Annual General Meeting. If approved, the dividend would result in a cash outflow of `1,795.87 crore
inclusive of dividend distribution tax of `306.21 crore.
In terms of our report attached For and on behalf of the Board of Directors
TO THE MEMBERS OF TATA STEEL LIMITED Our responsibilities under those Standards are further described
in the Auditor’s Responsibilities for the Audit of the Consolidated
Report on the Audit of the Consolidated Financial Financial Statements section of our report. We are independent
Statements of the Group, its associates and jointly controlled entities in
Opinion accordance with the ethical requirements that are relevant to
our audit of the Consolidated Financial Statements in India in
1.
We have audited the accompanying Consolidated Financial
terms of the Code of Ethics issued by the Institute of Chartered
Statements of Tata Steel Limited (hereinafter referred to as the
Accountants of India and the relevant provisions of the Act, and
“Holding Company”) and its subsidiaries (Holding Company
we have fulfilled our other ethical responsibilities in accordance
and its subsidiaries together referred to as “the Group”), its
with these requirements. We believe that the audit evidence we
associates and jointly controlled entities (refer Note 1 to the
have obtained and the audit evidence obtained by the other
attached Consolidated Financial Statements), which comprise
auditors in terms of their reports referred to in sub-paragraph 20
the Consolidated Balance Sheet as at March 31, 2019, the
of the Other Matters paragraph below, other than the unaudited
Consolidated Statement of Profit and Loss (including Other
financial statements/financial information as certified by the
Comprehensive Income), the Consolidated Statement of
management and referred to in sub-paragraph 21 of the Other
Changes in Equity and the Consolidated Statement of Cash
Matters paragraph below, is sufficient and appropriate to
Flows for the year then ended, and Notes to the Consolidated
provide a basis for our opinion.
Financial Statements, including a summary of significant
accounting policies and other explanatory information prepared Emphasis of Matter
based on the relevant records (hereinafter referred to as “the
4. We draw your attention to the following paragraph included in
Consolidated Financial Statements”).
the audit report on the consolidated special purpose financial
2. In our opinion and to the best of our information and according information of Tata Steel BSL Limited (formerly Bhushan Steel
to the explanations given to us, the aforesaid Consolidated Limited), a subsidiary of the Holding Company, issued by an
Financial Statements give the information required by the independent firm of chartered accountants vide its report dated
Companies Act, 2013 (“the Act”) in the manner so required April 18, 2019:
and give a true and fair view in conformity with the accounting
“We draw attention to Note 3 to the Consolidated Special Purpose
principles generally accepted in India, of the consolidated state
Financial Information which describes the implementation of
of affairs of the Group, its associates and jointly controlled entities
Resolution Plan pursuant to its approval by National Company
as at March 31, 2019, its consolidated total comprehensive
Law Tribunal and the resultant impact of the same, as recorded in
income (comprising of profit and other comprehensive income),
the Consolidated Special Purpose Financial Information as at 17
its consolidated changes in equity and its consolidated cash
May 2018. Our opinion is not modified in respect of this matter.”
flows for the year then ended.
Note 3 as described above corresponds to Note 41(A) to the
Basis for Opinion Consolidated Financial Statements. Our opinion is not modified
3. We conducted our audit in accordance with the Standards in respect of this matter.
on Auditing (SAs) specified under Section 143(10) of the Act.
293
CONSOLIDATED
Assessment of Holding Company’s litigations and related Our procedures included the following:
disclosure of contingent liabilities
• We understood, assessed and tested the design and operating
[Refer to Note 2 (c) to the Consolidated Financial Statements – “Use effectiveness of the Holding Company’s key controls
of estimates and critical accounting judgements – Provisions and surrounding assessment of litigations relating to the relevant
contingent liabilities”, Note 39 (A) to the Consolidated Financial laws and regulations;
Statements – “Contingencies” and Note 40 to the Consolidated
Financial Statements – “Other significant litigations”] • We discussed with management the recent developments and
the status of the material litigations which were reviewed and
As at March 31, 2019, the Holding Company has exposures noted by the Holding Company’s audit committee;
towards litigations relating to various matters as included in the
aforesaid Notes. • We performed our assessment on a test basis on the underlying
calculations supporting the contingent liabilities/other
Significant management judgement is required to assess such significant litigations made in relation to the Holding Company’s
matters to determine the probability of occurrence of material Standalone Financial Statements;
outflow of economic resources and whether a provision should
be recognised or a disclosure should be made. The management • We used auditor’s experts to gain an understanding and to
judgement is also supported with legal advice in certain cases as evaluate the disputed tax matters;
considered appropriate. • We considered external legal opinions, where relevant,
As the ultimate outcome of the matters are uncertain and the obtained by management;
positions taken by the management are based on the application • We met with the Holding Company’s external legal counsel to
of their best judgement, related legal advice including those understand the interpretation of laws/regulations considered
relating to interpretation of laws/regulations, it is considered to be by the management in their assessment relating to a
a Key Audit Matter. material litigation;
• We evaluated management’s assessments by understanding
precedents set in similar cases and assessed the reliability of the
management’s past estimates/judgements;
• We evaluated management’s assessment around those matters
that are not disclosed or not considered as contingent liability,
as the probability of material outflow is considered to be remote
by the management; and
• We assessed the adequacy of the disclosures.
Based on the above work performed, management’s assessment
in respect of Holding Company’s litigations and related disclosures
relating to contingent liabilities/other significant litigations in the
Consolidated Financial Statements are considered to be reasonable.
Key Audit Matter How our audit addressed the Key Audit Matter
Business combination- Purchase Price Allocation for Our procedures included the following:
acquisition of Tata Steel BSL Limited (formerly Bhushan
• We assessed and tested the design and operating effectiveness
Steel Limited)
of the Holding Company's key controls over the accounting of
[Refer to Note 2(e) to the Consolidated Financial Statements – business combination.
“Business Combinations” and Note 41(A) to the Consolidated
Financial Statements] • We have evaluated the competence, capabilities and objectivity
of the management’s expert, obtained an understanding of the
On May 18, 2018, the Group completed the acquisition of business work of the expert, and evaluated the appropriateness of the
of Tata Steel BSL Limited (formerly Bhushan Steel Limited) expert’s work as audit evidence.
(“TSBSL”), pursuant to the approved resolution plan under the
Insolvency and Bankruptcy Code, 2016. • We have traced the value of the consideration transferred with
reference to the resolution plan.
The Group determined the acquisition to be business combination
in accordance with Ind AS 103. Ind AS 103 requires the identified • We have obtained the audited financial information of TSBSL as at
assets and liabilities be recognised at fair value at the date of the acquisition date as audited by the other auditor. We engaged
acquisition with the excess of identified fair value of recognised with the other auditor to ensure completeness, accuracy and
assets and liabilities over the acquisition cost as capital reserve. valuation of the PPA adjustments including engagement of an
independent valuation expert by the other auditor and to agree
The Group engaged with the auditors of TSBSL (“other auditor”) the accounting done as per the resolution plan.
to perform an audit of the financial information of TSBSL as at the
acquisition date who have provided an unmodified opinion vide • We have further involved our valuation expert (“auditor’s
their audit report dated April 18, 2019. expert”) to review the PPA reports including the work done
by management experts and by the other auditor to assess
The Management determined that the fair values of the net reasonableness of the underlying key assumptions used in
identifiable assets acquired was `1,918.88 crore. The valuation was determining the fair value of assets and liabilities as at the
performed as part of the Purchase Price Allocation (PPA). acquisition date.
The Group appointed independent professional valuers to • We have evaluated the competence, capabilities and objectivity
perform valuation of certain assets for the purpose of PPA. of the auditor’s expert, and the adequacy of the work performed
The purchase price allocation exercise was completed resulting in by the auditor’s expert.
the Group recognising capital reserve of `1,236.34 crore directly in
“Other Equity”. • We have also assessed the Group’s determination of the fair
value of the remaining assets and liabilities having regard
Significant assumptions and estimates were used in the to the completeness of assets and liabilities identified and
determination of the fair values of the identified assets acquired the reasonableness of any underlying assumptions in their
and liabilities assumed in the transaction and thus we consider this respective valuations.
area to be a Key Audit Matter.
• We have also verified the management’s computation of
capital reserve.
Based on the above work performed, we noted that the PPA
adjustments have been performed in accordance with Ind AS
103. We have also assessed and corroborated the adequacy and
appropriateness of the disclosures made in the Consolidated
Financial Statements and found it reasonable.
295
CONSOLIDATED
6. The following Key Audit Matter was included in the audit report dated April 18, 2019, containing an unmodified audit opinion on the
consolidated special purpose financial information of Tata Steel BSL Limited (formerly Bhushan Steel Limited), a subsidiary of the Holding
Company issued by an independent firm of chartered accountants reproduced by us as under:
Key Audit Matter How our audit addressed the Key Audit Matter
Accounting treatment for the effects of the Resolution Plan We have performed the following procedures to test the
Refer Note 4 to the Consolidated Special Purpose recoverability of payments made by the Holding Company in
Financial Information. relation to litigations instituted against it prior to the approval of
the Resolution Plan:
Prior to the approval of the Resolution Plan on 15
May 2018, the Holding Company was a party to certain litigations. • Verified
the underlying documents related to litigations and
Pursuant to the approval of the Resolution Plan, it was determined other correspondences with the statutory authorities.
that no amounts are payable in respect of those litigations as they • Involved direct and indirect tax specialists to review the process
stand extinguished. used by the management to determine estimates and to test
The Holding Company had also made certain payments to the judgements applied by management in developing the
the relevant authorities in respect of those litigations which accounting estimates.
are presented as recoverable under “Other non-financial • Assessed management’s estimate of recoverability, supported
assets-non-current” in the Consolidated Special Purpose by an opinion obtained by the management from a legal expert,
Financial Information. by determining whether:
The estimates related to expected outcome of litigations and - The method of measurement used is appropriate in the
recoverability of payments made in respect thereof have high circumstances; and
degree of inherent uncertainty due to insufficient judicial
precedents in India in respect of disposal of litigations involving - The assumptions used by management are reasonable in light
companies admitted to Corporate Insolvency Resolution Process. of the measurement principles of Ind AS.
The application of significant judgement in the aforementioned • Determined whether the methods for making estimates have
matter required substantial involvement of senior personnel on been applied consistently.
the audit engagement including individuals with expertise in • Evaluated whether the accounting principles applied by the
accounting of financial instruments. management fairly present the amounts recoverable from
relevant authorities in Consolidated Special Purpose Financial
Information in accordance with the principles of Ind AS.”
7. The following key audit matters and related audit procedures (as reproduced) were communicated to us by the auditors of Tata Steel
Europe Limited, a subsidiary of the Holding Company:
Key Audit Matter How our audit addressed the Key Audit Matter
Accounting for Tata Steel Europe’s Pension Plan Our procedures included the following:
Tata Steel UK Ltd (‘TSUK’) sponsors a defined benefit pension plan • Evaluating the Directors’ assessment of the assumptions
with net post-retirement assets as at March 31, 2019 of £10.6bn made in relation to the valuations of the liabilities and assets
(Equivalent `96,807.02 crore) and net post-retirement liabilities as in the pension plans by comparing them to national and
at March 31, 2019 of £8.4bn (Equivalent `77,973.85 crore), which are industry averages.
significant in the context of the overall consolidated balance sheet
of the Tata Steel UK Limited and Tata Steel Limited. The scheme is • Focussing on the valuation of pension plan liabilities and the
now closed to all participants and there is no future accrual. pension assets by considering the experience and qualifications
of management’s actuaries in applying their methodology to the
The valuation of the pension liabilities requires some judgement pension liability and asset valuation.
and technical expertise in choosing appropriate assumptions.
A number of the key assumptions (including inflation, discount • Agreeing the discount, inflation rates and mortality assumptions
rates and mortality) have a material impact on the calculation used in the valuation of the pension liability to our internally
of the liability. developed benchmarks.
The pension assets include significant investments and the fair • Obtaining independent third party confirmations on ownership
value measurement of which includes judgement. The recognition and valuation of pension assets.
of post-retirement plan net assets for accounting purposes is • Testing a sample of pension assets to independent market
dependent on the rights of the employers to recover the surplus data where the asset was readily tradeable and engaging our
at the end of the life of the scheme. specialist valuations team to audit those assets that were not
freely transferrable on the open market, such as property assets.
• Validating a sample of the census data held by the Trustee
with that used by the actuary for the purpose of the pension
liability valuation.
• Testing the basis of recognition of the UK pension surplus
through the reading of scheme rules.
We did not identify any material exceptions from our audit work.
297
CONSOLIDATED
Key Audit Matter How our audit addressed the Key Audit Matter
Accounting for proposed JV with Thyssenkrupp Our procedures included the following:
On June 30, 2018, Tata Steel Limited (TSL) signed a deed of • Reviewing the Deed of Undertaking, Contribution Agreement
undertaking and contribution agreement with Thyssenkrupp AG and Shareholders Agreement regarding the
(tk) to form a joint venture between the European steel operations proposed joint venture.
of both companies called thyssenkrupp Tata Steel BV (tkTS).
• Reviewing the board minutes and other documents of relevance
TSL have agreed to contribute the entire issued share capital prepared by Tata Steel Europe and its subsidiaries in relation to
of Tata Steel Netherlands Holdings BV (TSNH) for a 50% share in the proposed joint venture.
the enlarged tkTS.
• Reviewing communications made by key stakeholders in
The joint venture remains subject to review and approval by the relation to the joint venture, including statements from the
European Commission. Their findings and the announcement European Commission.
of any potential remedial actions are expected in June 2019.
TSL’s shareholders will also be required to provide their consent • Considering the proposed accounting by the directors by
via a shareholder vote prior to the contribution by TSL of share assessing the requirements of ‘Non-current Assets Held for Sale
capital of TSNH. and Discontinued Operations’.
The directors are not presenting the TSNH group as an asset held We did not identify any material exceptions from our audit work.
for sale on the basis that the proposed transaction as at March 31,
2019 was not highly probable in its current form, primarily because
it still required the consent of TSL shareholders, approval of
European Commission and the structure of the disposal group has
not been clarified.
In our view, this matter was of particular importance for our audit
due to the significant judgement involved in assessing the criteria
for held for sale and the potential material effects on the Group's
assets, liabilities, financial position and financial performance.
8. The following key audit matter and related audit procedures (as reproduced) were communicated to us by the auditors of Tata Steel
Minerals Canada Limited, a subsidiary of the Holding Company:
Key Audit Matter How our audit addressed the Key Audit Matter
Impairment of Long lived assets Our audit procedures included the following:
Property plant and equipment (PP&E) in annexure 100 the • We updated our understanding and evaluating the controls
financial information as of March 31, 2019 amount to $979 around this risk.
million (Equivalent `6,577.49 crore). The Company continues to
wrap-up the processing plant and expects to enter commercial • We tested the status of ownership of mineral titles.
production in the coming months. In accordance with IAS 36, • We evaluated the Company’s assessment whether objective
Management has performed an impairment indicator assessment evidence of impairment exists for the project.
and concluded that there was an impairment indicator due to the
change of the production plan. Where an indication of impairment • We evaluated the Company’s process regarding impairment
exists, the carrying amount of the project is assessed and an assessment using value in use calculations by involving our
impairment provision is recognised, if required, immediately to valuation experts to assist in assessing the appropriateness of
its recoverable amount. Management prepared a discounted cash the impairment model including key inputs into the model.
flow using the value in use (VIU) model to estimate the recoverable • We assessed the VIU calculations performed by the Company
amount as at March 31, 2019. The accounting for mining project in were within a predefined tolerable differences range.
development phase is a key audit matter as the determination of
VIU for impairment assessment involves significant management • We assessed the historical accuracy of the Company’s forecasts
judgement. The impairment assessment has been done by the by comparing the forecasts used in the prior year model with
management in accordance with IAS 36. the actual performance in the current year.
The key inputs and judgements involved in the impairment/fair • We checked the mathematical accuracy of the impairment
valuation assessment include: model and agreed relevant data back to the latest actual past
results and other supporting documents.
• Forecasted cash flows including assumptions on growth rates
and production cost • We performed sensitivity analysis and evaluated whether any
reasonably foreseeable change in assumptions could lead to
• Timing and ramp-up – The model was adjusted for the impairment or material change in the VIU.
completion of the Wet plant (in FY20) and extension of the life
of mine as a result of reduction of the quantity, which will be The impairment assessment remains sensitive to a range of
processed by the plant. assumptions, in particular to changes in the pre-tax discount rate
and the achievement of the forecasted growth rates.
• CFR China Fe 65% Sinter –the premium for 65% Fe over the
62% Fe Based on the above procedures performed, we noted the results
of management’s impairment assessment to be reasonable and
• Total ore reserve consistent with the outcome of our procedures.”
• Discount rates
• Exchange rate between US and Canadian dollar
Economic and entity specific factors are incorporated in the
valuation used in the impairment assessment.
299
CONSOLIDATED
Other Information due to fraud or error, which have been used for the purpose of
9. The Holding Company’s Board of Directors is responsible for preparation of the Consolidated Financial Statements by the
the other information. The other information comprises the Directors of the Holding Company, as aforesaid.
information in the Integrated Report, Board's Report alongwith 13.
In preparing the Consolidated Financial Statements, the
its Annexures and Financial Highlights included in the Holding respective Board of Directors of the companies included in
Company’s Annual Report (titled as ‘Tata Steel Integrated Report the Group and of its associates and jointly controlled entities
& Annual Accounts 2018-19'), but does not include the financial are responsible for assessing the ability of the Group and of its
statements and our auditor’s report thereon. associates and jointly controlled entities to continue as a going
10. Our opinion on the Consolidated Financial Statements does not concern, disclosing, as applicable, matters related to going
cover the other information and we do not express any form of concern and using the going concern basis of accounting unless
assurance conclusion thereon. management either intends to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
11. In connection with our audit of the Consolidated Financial
Statements, our responsibility is to read the other information 14. The respective Board of Directors of the companies included in
and, in doing so, consider whether the other information the Group and of its associates and jointly controlled entities are
is materially inconsistent with the Consolidated Financial responsible for overseeing the financial reporting process of the
Statements or our knowledge obtained in the audit or otherwise Group and of its associates and jointly controlled entities.
appears to be materially misstated. If, based on the work we have
Auditor’s Responsibilities for the Audit of the Consolidated
performed and the reports of the other auditors as furnished
Financial Statements
to us (Refer paragraph 20 below), we conclude that there is a
material misstatement of this other information, we are required 15.
Our objectives are to obtain reasonable assurance about
to report that fact. We have nothing to report in this regard. whether the Consolidated Financial Statements as a whole
are free from material misstatement, whether due to fraud or
Responsibilities of Management and Those Charged with error, and to issue an auditor’s report that includes our opinion.
Governance for the Consolidated Financial Statements Reasonable assurance is a high level of assurance, but is not a
12. The Holding Company’s Board of Directors is responsible for the guarantee that an audit conducted in accordance with SAs
preparation and presentation of these Consolidated Financial will always detect a material misstatement when it exists.
Statements in terms of the requirements of the Act that give Misstatements can arise from fraud or error and are considered
a true and fair view of the consolidated financial position, material if, individually or in the aggregate, they could reasonably
consolidated financial performance, consolidated changes in be expected to influence the economic decisions of users taken
equity and consolidated cash flows of the Group including its on the basis of these Consolidated Financial Statements.
associates and jointly controlled entities in accordance with the 16.
As part of an audit in accordance with SAs, we exercise
accounting principles generally accepted in India, including the professional judgement and maintain professional scepticism
Accounting Standards specified under Section 133 of the Act. throughout the audit. We also:
The respective Board of Directors of the companies included in
the Group and of its associates and jointly controlled entities are • Identify and assess the risks of material misstatement of the
responsible for maintenance of adequate accounting records Consolidated Financial Statements, whether due to fraud or
in accordance with the provisions of the Act for safeguarding error, design and perform audit procedures responsive to
the assets of the Group and its associates and jointly controlled those risks, and obtain audit evidence that is sufficient and
entities respectively and for preventing and detecting frauds appropriate to provide a basis for our opinion. The risk of not
and other irregularities; selection and application of appropriate detecting a material misstatement resulting from fraud is
accounting policies; making judgements and estimates that are higher than for one resulting from error, as fraud may involve
reasonable and prudent; and the design, implementation and collusion, forgery, intentional omissions, misrepresentations,
maintenance of adequate internal financial controls, that were or the override of internal control.
operating effectively for ensuring the accuracy and completeness • Obtain an understanding of internal control relevant to the
of the accounting records, relevant to the preparation and audit in order to design audit procedures that are appropriate
presentation of the financial statements that give a true and in the circumstances. Under Section 143(3)(i) of the Act, we
fair view and are free from material misstatement, whether are also responsible for expressing our opinion on whether
the Holding Company has adequate internal financial controls 18. We also provide those charged with governance with a statement
with reference to Consolidated Financial Statements in place that we have complied with relevant ethical requirements
and the operating effectiveness of such controls. regarding independence, and to communicate with them
all relationships and other matters that may reasonably be
• Evaluate the appropriateness of accounting policies used
thought to bear on our independence, and where applicable,
and the reasonableness of accounting estimates and related
related safeguards.
disclosures made by management.
19.
From the matters communicated with those charged with
• Conclude on the appropriateness of management’s use of governance, we determine those matters that were of
the going concern basis of accounting and, based on the
most significance in the audit of the Consolidated Financial
audit evidence obtained, whether a material uncertainty
Statements of the current year and are therefore the Key Audit
exists related to events or conditions that may cast significant
Matters. We describe these matters in our auditor’s report unless
doubt on the ability of the Group and its associates and
law or regulation precludes public disclosure about the matter
jointly controlled entities to continue as a going concern.
or when, in extremely rare circumstances, we determine that
If we conclude that a material uncertainty exists, we are
a matter should not be communicated in our report because
required to draw attention in our auditor’s report to the
the adverse consequences of doing so would reasonably
related disclosures in the Consolidated Financial Statements
be expected to outweigh the public interest benefits of
or, if such disclosures are inadequate, to modify our opinion.
such communication.
Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or Other Matters
conditions may cause the Group and its associates and jointly
20. We did not audit the financial statements/financial information
controlled entities to cease to continue as a going concern.
of seventeen subsidiaries whose financial statements/financial
• Evaluate the overall presentation, structure and content of the information reflect total assets of `132,537.70 crore and net
Consolidated Financial Statements, including the disclosures, assets of `1,058.37 crore as at March 31, 2019, total revenue of
and whether the Consolidated Financial Statements represent `88,748.77 crore, total comprehensive income [comprising of
the underlying transactions and events in a manner that profit/(loss) and other comprehensive income] of `(2,690.43)
achieves fair presentation. crore and net cash flows amounting to `38.83 crore for the
year ended on that date, as considered in the Consolidated
• Obtain sufficient appropriate audit evidence regarding the Financial Statements, which also include their step down jointly
financial information of the entities or business activities
controlled entities and associates constituting `37.18 crore
within the Group and its associates and jointly controlled
of the Group’s share of total comprehensive income for the
entities to express an opinion on the Consolidated Financial
year ended on that date. These financial statements/financial
Statements. We are responsible for the direction, supervision
information have been audited by other auditors whose reports
and performance of the audit of the financial statements
have been furnished to us by the other auditors/Management,
of such entities included in the Consolidated Financial
and our opinion on the Consolidated Financial Statements
Statements of which we are the independent auditors.
insofar as it relates to the amounts and disclosures included in
For the other entities included in the Consolidated Financial
respect of these subsidiaries, their step down jointly controlled
Statements, which have been audited by other auditors,
entities and associates and our report in terms of sub-section (3)
such other auditors remain responsible for the direction,
of Section 143 of the Act including report on Other Information
supervision and performance of the audits carried out by
insofar as it relates to the aforesaid subsidiaries and their step
them. We remain solely responsible for our audit opinion.
down jointly controlled entities and associates, is based solely
17.
We communicate with those charged with governance of on the reports of the other auditors.
the Holding Company and such other entities included in
21. We did not audit the financial statements/financial information
the Consolidated Financial Statements of which we are the
of twelve subsidiaries whose financial statements/financial
independent auditors regarding, among other matters, the
information reflect total assets of `8,280.96 crore and net assets
planned scope and timing of the audit and significant audit
of `3,692.07 crore as at March 31, 2019, total revenue of `881.94
findings, including any significant deficiencies in internal control
crore, total comprehensive income [comprising of profit/(loss)
that we identify during our audit.
and other comprehensive income] of `391.33 crore and net cash
301
CONSOLIDATED
flows amounting to `(64.54) crore for the year ended on that “As required by section 197(16) of the Act, based on our audit,
date, as considered in the Consolidated Financial Statements. we report that the Holding Company paid remuneration to
The Consolidated Financial Statements also include the Group’s its directors during the period 18 May 2018 to 31 March 2019
share of total comprehensive income [comprising of profit/(loss) in accordance with the provisions of and limits laid down
and other comprehensive income] of `15.83 crore and `37.30 under section 197 read with Schedule V to the Act. On the
crore for the year ended March 31, 2019 as considered in the consideration of the reports of the other auditors, referred to
Consolidated Financial Statements, in respect of four associates in paragraph 12, on separate financial statements of certain
and six jointly controlled entities respectively, whose financial subsidiaries, we report that three subsidiary companies covered
statements/financial information have not been audited by us. under the Act have not paid or provided for any managerial
These financial statements/financial information are unaudited remuneration during the period 18 May 2018 to 31 March 2019.
and have been furnished to us by the Management, and our Further, as stated in paragraph 13, financial statements of two
opinion on the Consolidated Financial Statements insofar as associate companies covered under the Act are unaudited and
it relates to the amounts and disclosures included in respect have been furnished to us by the management, and as certified
of these subsidiaries, jointly controlled entities and associate by the management, such companies have not paid or provided
companies and our report in terms of sub-section (3) of Section for any managerial remuneration during the period 18 May 2018
143 of the Act including report on Other Information insofar as to 31 March 2019.”
it relates to the aforesaid subsidiaries, jointly controlled entities
24. As required by Section 143(3) of the Act, we report, to the extent
and associate companies, is based solely on such unaudited
applicable, that:
financial statements/financial information. In our opinion and
according to the information and explanations given to us by the (a) We have sought and obtained all the information and
Management, these financial statements/financial information explanations which to the best of our knowledge and
are not material to the Group. belief were necessary for the purposes of our audit of the
aforesaid Consolidated Financial Statements.
Our opinion on the Consolidated Financial Statements and our
report on Other Legal and Regulatory Requirements below, is (b) In our opinion, proper books of account as required by
not modified in respect of the above matters with respect to our law relating to preparation of the aforesaid Consolidated
reliance on the work done and the reports of the other auditors Financial Statements have been kept so far as it appears
and the financial statements/financial information certified by from our examination of those books and the reports of
the Management. the other auditors.
22. In the case of one subsidiary, one jointly controlled entity and (c)
The Consolidated Balance Sheet, the Consolidated
two associates, the financial information for the year ended Statement of Profit and Loss (including Other
March 31, 2019 is not available. The investments in these Comprehensive Income), the Consolidated Statement
companies are carried at Re. 1 as at March 31, 2019. In absence of Changes in Equity and the Consolidated Statement of
of the aforementioned financial information, the financial Cash Flows dealt with by this Report are in agreement with
information in respect of the aforesaid subsidiary and the the relevant books of account and records maintained
Group's share of total comprehensive income of these jointly for the purpose of preparation of the Consolidated
controlled entities and associate companies for the year ended Financial Statements.
March 31, 2019 have not been included in the Consolidated
(d)
In our opinion, the aforesaid Consolidated Financial
Financial Statements. Our opinion is not modified in respect
Statements comply with the Accounting Standards
of this matter.
specified under Section 133 of the Act.
Report on Other Legal and Regulatory Requirements (e) On the basis of the written representations received from
23. We draw attention to the following paragraph included in the the directors of the Holding Company taken on record
audit report on the consolidated special purpose financial by the Board of Directors of the Holding Company and
information of Tata Steel BSL Limited (formerly Bhushan Steel the reports of the statutory auditors of its subsidiary
Limited), a subsidiary of the Holding Company, issued by an companies, associate companies and jointly controlled
independent firm of chartered accountants vide its report dated companies incorporated in India, none of the directors of
April 18, 2019 reproduced by us as under: the Group companies, its associate companies and jointly
controlled companies incorporated in India is disqualified
as on March 31, 2019 from being appointed as a director in iii. There has been no delay in transferring amounts, required
terms of Section 164(2) of the Act. to be transferred, to the Investor Education and Protection
Fund by the Holding Company and its subsidiary
(f ) With respect to the adequacy of internal financial controls
companies, associate companies and jointly controlled
with reference to Consolidated Financial Statements of the
companies incorporated in India during the year ended
Group and the operating effectiveness of such controls,
March 31, 2019 except for amounts aggregating to `5.25
refer to our separate report in Annexure A.
crore, which according to the information and explanations
(g)
With respect to the other matters to be included in provided by the management is held in abeyance due to
the Auditor’s Report in accordance with Rule 11 of the dispute/pending legal cases.
Companies (Audit and Auditor’s) Rules, 2014, in our opinion
iv. The reporting on disclosures relating to Specified Bank
and to the best of our information and according to the
Notes is not applicable to the Group for the year ended
explanations given to us:
March 31, 2019.
i.
The Consolidated Financial Statements disclose the
impact of pending litigations as on March 31, 2019 on the For Price Waterhouse & Co Chartered Accountants LLP
consolidated financial position of the Group, its associates Firm Registration Number: 304026E/ E-300009
and jointly controlled entities– Refer Notes 39 (A) and 40 to Chartered Accountants
the Consolidated Financial Statements.
ii. The Group, its associates and jointly controlled entities Russell I Parera
had long-term contracts including derivative contracts
as on March 31, 2019 for which there were no material Place: Mumbai Partner
foreseeable losses. Date: April 25, 2019 Membership Number 042190
303
CONSOLIDATED
Referred to in paragraph 24(f) of the Independent Auditor’s audit in accordance with the Guidance Note on Audit of Internal
Report of even date to the members of Tata Steel Limited on Financial Controls Over Financial Reporting (the “Guidance
the Consolidated Financial Statements as of and for the year Note”) and the Standards on Auditing deemed to be prescribed
ended March 31, 2019
under Section 143(10) of the Companies Act, 2013, to the
extent applicable to an audit of internal financial controls, both
Report on the Internal Financial Controls with reference to applicable to an audit of internal financial controls and both
Consolidated Financial Statements under Clause (i) of Sub- issued by the ICAI. Those Standards and the Guidance Note
section 3 of Section 143 of the Companies Act, 2013 (“the Act”) require that we comply with ethical requirements and plan
1. In conjunction with our audit of the Consolidated Financial and perform the audit to obtain reasonable assurance about
Statements of the Tata Steel Limited (hereinafter referred whether adequate internal financial controls with reference
to as “the Holding Company”) as of and for the year ended to Consolidated Financial Statements was established and
March 31, 2019, we have audited the internal financial controls maintained and if such controls operated effectively in all
with reference to Consolidated Financial Statements of the material respects.
Holding Company and its subsidiary companies, its associate
4.
Our audit involves performing procedures to obtain audit
companies and jointly controlled companies, which are
evidence about the adequacy of the internal financial controls
companies incorporated in India, as of that date. Reporting under
system with reference to Consolidated Financial Statements
clause (i) of sub-section 3 of Section 143 of the Act in respect of
and their operating effectiveness. Our audit of internal financial
the adequacy of the internal financial controls with reference to
controls with reference to Consolidated Financial Statements
financial statements is not applicable to two jointly controlled
included obtaining an understanding of internal financial
companies incorporated in India namely S & T Mining Company
controls with reference to Consolidated Financial Statements,
Private Limited and Tata NYK Shipping (India) Private Limited,
assessing the risk that a material weakness exists, and testing and
pursuant to MCA notification GSR 583(E) dated June 13, 2017.
evaluating the design and operating effectiveness of internal
Management’s Responsibility for Internal Financial Controls control based on the assessed risk. The procedures selected
depend on the auditor’s judgment, including the assessment of
2. The respective Board of Directors of the Holding Company,
the risks of material misstatement of the Consolidated Financial
its subsidiary companies, its associate companies and jointly
Statements, whether due to fraud or error.
controlled companies, to whom reporting under clause (i) of
sub-section 3 of Section 143 of the Act in respect of the adequacy 5. We believe that the audit evidence we have obtained and
of the internal financial controls with reference to financial the audit evidence obtained by the other auditors in terms of
statements is applicable, which are companies incorporated in their reports referred to in the Other Matter paragraph below,
India, are responsible for establishing and maintaining internal is sufficient and appropriate to provide a basis for our audit
financial controls based on the internal control over financial opinion on the Company’s internal financial controls system
reporting criteria established by the Company considering the with reference to Consolidated Financial Statements.
essential components of internal control stated in the Guidance
Note on Audit of Internal Financial Controls Over Financial Meaning of Internal Financial Controls with reference to
Reporting issued by the Institute of Chartered Accountants financial statements
of India (ICAI). These responsibilities include the design, 6. A company's internal financial control with reference to financial
implementation and maintenance of adequate internal financial statements is a process designed to provide reasonable
controls that were operating effectively for ensuring the orderly assurance regarding the reliability of financial reporting and
and efficient conduct of its business, including adherence the preparation of financial statements for external purposes
to the respective company’s policies, the safeguarding of its in accordance with generally accepted accounting principles.
assets, the prevention and detection of frauds and errors, the A company's internal financial controls with reference to financial
accuracy and completeness of the accounting records, and statements includes those policies and procedures that (1)
the timely preparation of reliable financial information, as pertain to the maintenance of records that, in reasonable detail,
required under the Act. accurately and fairly reflect the transactions and dispositions of
the assets of the company; (2) provide reasonable assurance that
Auditor’s Responsibility transactions are recorded as necessary to permit preparation
3. Our responsibility is to express an opinion on the Company's of financial statements in accordance with generally accepted
internal financial controls with reference to Consolidated accounting principles, and that receipts and expenditures
Financial Statements based on our audit. We conducted our of the company are being made only in accordance with
authorisations of management and directors of the company; 2019, based on the internal control over financial reporting
and (3) provide reasonable assurance regarding prevention or criteria established by the Company considering the essential
timely detection of unauthorised acquisition, use, or disposition components of internal control stated in the Guidance Note on
of the company's assets that could have a material effect on the Audit of Internal Financial Controls Over Financial Reporting
financial statements. issued by the Institute of Chartered Accountants of India.
305
CONSOLIDATED
(` crore)
As at As at
Note Page
March 31, 2019 March 31, 2018
Assets
I Non-current assets
(a) Property, plant and equipment 3 327 1,18,450.97 90,322.78
(b) Capital work-in-progress 17,956.51 16,159.80
(c) Goodwill on consolidation 5 332 3,996.62 4,099.45
(d) Other intangible assets 6 333 1,994.32 1,682.66
(e) Intangible assets under development 684.70 454.61
(f ) Equity accounted investments 7 335 1,922.95 1,781.22
(g) Financial assets
(i) Investments 8 337 1,290.36 1,209.28
(ii) Loans 9 338 613.34 717.34
(iii) Derivative assets 108.74 29.16
(iv) Other financial assets 10 340 570.06 87.91
(h) Retirement benefit assets 11 341 19,964.19 20,570.87
(i) Non-current tax assets 1,574.78 1,152.76
(j) Deferred tax assets 12 342 808.95 1,035.80
(k) Other assets 13 346 4,654.92 2,577.14
Total non-current assets 1,74,591.41 1,41,880.78
II Current assets
(a) Inventories 14 348 31,656.10 28,331.04
(b) Financial assets
(i) Investments 8 337 2,524.86 14,908.97
(ii) Trade receivables 15 348 11,811.00 12,415.52
(iii) Cash and cash equivalents 16 350 2,975.53 7,783.50
(iv) Other balances with banks 17 350 365.84 154.35
(v) Loans 9 338 239.70 256.48
(vi) Derivative assets 359.11 150.95
(vii) Other financial assets 10 340 1,248.56 610.60
(c) Retirement benefit assets 11 341 4.38 2.91
(d) Current tax assets 133.94 62.28
(e) Other assets 13 346 3,529.70 3,098.09
Total current assets 54,848.72 67,774.69
III Assets held for sale 18 351 4,142.26 102.47
Total assets 2,33,582.39 2,09,757.94
(` crore)
As at As at
Note Page
March 31, 2019 March 31, 2018
Equity and liabilities
IV Equity
(a) Equity share capital 19 353 1,144.94 1,144.95
(b) Hybrid perpetual securities 20 356 2,275.00 2,275.00
(c) Other equity 21 357 65,505.14 57,450.67
Equity attributable to owners of the Company 68,925.08 60,870.62
Non-controlling interests 2,364.46 936.52
Total equity 71,289.54 61,807.14
V Non-current liabilities
(a) Financial liabilities
(i) Borrowings 23 363 80,342.73 72,789.10
(ii) Derivative liabilities 59.82 85.04
(iii) Other financial liabilities 24 368 270.58 105.83
(b) Provisions 25 369 4,046.21 4,338.24
(c) Retirement benefit obligations 11 341 2,653.46 2,516.56
(d) Deferred income 26 370 906.80 1,526.58
(e) Deferred tax liabilities 12 342 12,459.89 10,569.88
(f ) Other liabilities 27 371 519.23 358.16
Total non-current liabilities 1,01,258.72 92,289.39
VI Current liabilities
(a) Financial liabilities
(i) Borrowings 23 363 10,802.08 15,884.98
(ii) Trade payables 28 372
(a) Total outstanding dues of micro and small enterprises 169.74 32.21
(b) Total outstanding dues of creditors other than micro and 21,547.22 20,381.60
small enterprises
(iii) Derivative liabilities 416.59 468.79
(iv) Other financial liabilities 24 368 16,737.83 9,791.78
(b) Provisions 25 369 1,248.72 1,269.64
(c) Retirement benefit obligations 11 341 120.69 110.36
(d) Deferred income 26 370 16.51 6.21
(e) Current tax liabilities 636.42 783.47
(f ) Other liabilities 27 371 7,912.21 6,932.26
Total current liabilities 59,608.01 55,661.30
VII Liabilities held for sale 18 351 1,426.12 0.11
Total equity and liabilities 2,33,582.39 2,09,757.94
Notes forming part of the consolidated financial statements 1-53
In terms of our report attached For and on behalf of the Board of Directors
307
CONSOLIDATED
(` crore)
Year ended Year ended
Note Page
March 31, 2019 March 31, 2018
I Revenue from operations 29 372 1,57,668.99 1,24,109.69
II Other income 30 373 1,420.58 881.10
III Total income 1,59,089.57 1,24,990.79
IV Expenses:
(a) Cost of materials consumed 54,309.07 40,762.41
(b) Purchases of stock-in-trade 6,567.98 5,374.60
(c) Changes in inventories of finished and semi-finished goods, stock-in-trade and (96.71) 99.31
work-in-progress
(d) Employee benefits expense 31 373 18,758.87 16,969.91
(e) Finance costs 32 374 7,660.10 5,454.74
(f ) Depreciation and amortisation expense 33 374 7,341.83 5,741.70
(g) Other expenses 34 374 50,410.72 40,471.13
1,44,951.86 1,14,873.80
(h) Less: Expenditure (other than interest) transferred to capital and other accounts 1,664.28 1,000.86
Total expenses 1,43,287.58 1,13,872.94
V Share of profit/(loss) of joint ventures and associates 224.70 239.12
VI Profit/(loss) before exceptional items and tax (III-IV+V) 16,026.69 11,356.97
VII Exceptional items: 35 375
(a) Profit on sale of subsidiaries and non-current investments 180.13 -
(b) Provision for impairment of investments/doubtful advances (172.12) (27.25)
(c) Provision for impairment of non-current assets (9.57) (903.01)
(d) Provision for demands and claims (328.64) (3,213.68)
(e) Employee separation compensation (35.33) (107.60)
(f ) Restructuring and other provisions 244.56 13,850.66
Total exceptional items (120.97) 9,599.12
VIII Profit/(loss) before tax (VI+VII) 15,905.72 20,956.09
IX Tax expense:
(a) Current tax 6,728.14 1,980.24
(b) Deferred tax (9.71) 1,412.09
Total tax expense 6,718.43 3,392.33
X Profit/(loss) after tax from continuing operations 9,187.29 17,563.76
(` crore)
Year ended Year ended
Note Page
March 31, 2019 March 31, 2018
XIII Other comprehensive income/(loss)
A. (i) Items that will not be reclassified subsequently to profit and loss:
(a) Remeasurement gain/(loss) on post-employment defined benefit plans (683.60) (1,489.18)
(b) Fair value changes of investments in equity shares (36.65) (204.55)
(c) Share of equity accounted investees (0.14) (0.24)
(ii) Income tax on items that will not be reclassified subsequently to 94.83 212.98
profit and loss
B. (i) Items that will be reclassified subsequently to profit and loss:
(a) Foreign currency translation differences 508.47 (1,544.04)
(b) Fair value changes of cash flow hedges 161.80 (97.76)
(c) Share of equity accounted investees 4.53 16.20
(ii) Income tax on items that will be reclassified subsequently to (41.45) 28.58
profit and loss
Total other comprehensive income/(loss) for the year 7.79 (3,078.01)
XIV Total comprehensive income/(loss) for the year (XII+XIII) 9,106.12 14,684.80
309
CONSOLIDATED
(` crore)
Balance as at Changes Balance as at
April 1, 2017 during the year March 31, 2018
970.24 174.71 1,144.95
(` crore)
Balance as at Changes Balance as at
April 1, 2017 during the year March 31, 2018
2,275.00 - 2,275.00
C. Other equity
(` crore)
Retained Items of other Other Share Other equity Non- Total
earnings comprehensive consolidated application attributable to controlling
[refer note income reserves money pending the owners of interests
21A, page 357] [refer note 21B, [refer note 21C, allotment the Company
page 357] page 359] [refer note 21D,
page 361]
Balance as at April 1, 2018 7,801.99 7,149.50 42,499.16 0.02 57,450.67 936.52 58,387.19
Profit/(loss) for the year 10,218.33 - - - 10,218.33 (1,120.00) 9,098.33
Other comprehensive income (425.92) 570.47 - - 144.55 (136.76) 7.79
for the year
Total comprehensive income for 9,792.41 570.47 - - 10,362.88 (1,256.76) 9,106.12
the year
Issue of Ordinary Shares - - 0.26 (0.26) - - -
Equity issue expenses - - 0.43 - 0.43 - 0.43
written (off )/back
Dividend(i) (1,144.76) - - - (1,144.76) (41.44) (1,186.20)
Tax on dividend (224.61) - - - (224.61) - (224.61)
Distribution on hybrid (266.12) - - - (266.12) - (266.12)
perpetual securities
Tax on distribution on hybrid 92.99 - - - 92.99 - 92.99
perpetual securities
Transfers within equity 29.95 (31.06) 1.11 - - - -
Addition relating to acquisitions - - 1,336.41 - 1,336.41 729.33 2,065.74
Disposal of group undertakings - - - - - (67.10) (67.10)
Adjustment for changes in (2,025.42) - - - (2,025.42) 2,025.42 -
ownership interests
Application money received - - - 0.24 0.24 - 0.24
Adjustment for cross holdings - - (0.81) - (0.81) - (0.81)
Other movements - (76.76) - - (76.76) 38.49 (38.27)
Balance as at March 31, 2019 14,056.43 7,612.15 43,836.56 - 65,505.14 2,364.46 67,869.60
(` crore)
Retained Items of other Other Share Other equity Non- Total
earnings comprehensive consolidated application attributable to controlling
[refer note income reserves money pending the owners of interests
21A, [refer note 21B, [refer note 21C, allotment the Company
page 357] page 357] page 359] [refer note 21D,
page361]
Balance as at April 1, 2017 (11,447.01) 12,428.86 33,592.22 0.01 34,574.08 1,601.70 36,175.78
Profit/(loss) for the year 13,434.33 - - - 13,434.33 4,328.48 17,762.81
Other comprehensive income (2,780.05) (1,851.74) - - (4,631.79) 1,553.78 (3,078.01)
for the year
Total comprehensive income for 10,654.28 (1,851.74) - - 8,802.54 5,882.26 14,684.80
the year
Issue of Ordinary Shares(ii) - - 8,939.59 (0.01) 8,939.58 - 8,939.58
Equity issue expenses written off(ii) - - (33.85) - (33.85) - (33.85)
Dividend(i) (970.05) - - - (970.05) (15.07) (985.12)
Tax on dividend (188.17) - - - (188.17) - (188.17)
Distribution on hybrid (266.13) - - - (266.13) - (266.13)
perpetual securities
Tax on distribution on hybrid 92.70 - - - 92.70 - 92.70
perpetual securities
Transfers within equity 3,426.26 (3,427.62) 1.20 - (0.16) 0.16 -
Adjustment for changes in 6,500.11 - - - 6,500.11 (6,500.11) -
ownership interests
Application money received - - - 0.02 0.02 - 0.02
Other movements - - - - - (32.42) (32.42)
Balance as at March 31, 2018 7,801.99 7,149.50 42,499.16 0.02 57,450.67 936.52 58,387.19
(i) Dividend paid during the year ended March 31, 2019 is `10.00 per Ordinary Share (face value `10 each, fully paid up) and `2.504 per
Ordinary Share (face value `10, partly paid up `2.504 per share) (March 31, 2018: `10.00 per Ordinary Share of face value `10 each,
fully paid up).
(ii) Represents premium received and issue expenses on right issue of shares during the year ended March 31, 2018.
In terms of our report attached For and on behalf of the Board of Directors
311
CONSOLIDATED
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
A. Cash flows from operating activities:
Profit before taxes 15,807.12 21,168.20
Adjustments for:
Depreciation and amortisation expense 7,579.32 5,961.66
Dividend income (26.19) (68.25)
(Gain)/loss on sale of property, plant and equipment including intangible (266.40) 49.29
assets (net of loss on assets sold/scrapped/written off )
Exceptional (income)/expenses 136.26 (9,599.12)
(Gain)/loss on cancellation of forwards, swaps and options (36.95) 79.33
Interest income and income from current investments (1,037.89) (929.15)
Finance costs 7,741.88 5,501.79
Exchange (gain)/loss on revaluation of foreign currency loans and swaps (1,150.77) (1,376.77)
Share of profit or loss of joint ventures and associates (222.27) (174.10)
(Profit)/loss on disposal of discontinued operation - (5.15)
Other non-cash items (684.45) (420.59)
12,032.54 (981.06)
Operating profit before changes in non-current/current assets 27,839.66 20,187.14
and liabilities
Adjustments for:
Non-current/current financial and other assets (114.54) (208.94)
Inventories (1,068.71) (1,595.43)
Non-current/current financial and other liabilities/provisions 3,773.76 (7,471.16)
2,590.51 (9,275.53)
Cash generated from operations 30,430.17 10,911.61
Income taxes paid (5,094.22) (2,888.22)
Net cash from/(used in) operating activities 25,335.95 8,023.39
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
C. Cash flows from financing activities:
Proceeds from issue of equity shares (net of issue expenses(ii)) (6.03) 9,087.23
Proceeds from borrowings 42,763.90 24,161.36
Repayment of borrowings (34,246.39) (19,724.98)
Repayment of finance lease obligations (276.33) (211.15)
Amount received/(paid) on utilisation/cancellation of derivatives (66.64) (79.86)
Distribution on hybrid perpetual securities (265.39) (267.10)
Interest paid (7,151.93) (5,145.57)
Dividend paid (1,186.20) (982.35)
Tax on dividend paid (237.69) (197.64)
Net cash from/(used in) financing activities (672.70) 6,639.94
Net increase/(decrease) in cash and cash equivalents (5,238.57) 2,637.70
Opening cash and cash equivalents (refer note16, page 350) (iii) 8,179.62 4,850.48
Effect of exchange rate on translation of foreign currency cash and 34.48 295.32
cash equivalents
Closing cash and cash equivalents (refer note16, page 350) 2,975.53 7,783.50
(i) Includes `91.62 crore (2017-18: Nil) received in respect of deferred consideration on disposal of a subsidiary during the year ended
March 31, 2018.
(ii) During the year ended March 31, 2018, expenses incurred in connection with Rights Issue, 2018 was partly paid by the Company and was
pending adjustment against actual utilisation from the issue proceeds. The same has been fully utilised during the year.
(iii) Includes `713.59 crore (2017-18: `18.19 crore) in respect of a subsidiary acquired during the year and excludes `317.47 crore
(2017-18: Nil) in respect of subsidiaries disposed off/classified as held for sale.
(iv) Significant non-cash movements in borrowings during the year include:
(a) a ddition on account of subsidiaries acquired during the year `986.65 crore (2017-18: `719.37 crore) and reduction on account of
subsidiaries disposed off/classified as held for sale `758.50 crore (2017-18: Nil).
(b) exchange gain (including translation) `344.86 crore (2017-18: loss `3,571.86 crore).
(c) amortisation/effective interest rate adjustments of upfront fees `626.30 crore (2017-18: `456.16 crore)
(d) adjustment to finance lease obligations, decrease `26.35 crore (2017-18: increase `167.65 crore).
In terms of our report attached For and on behalf of the Board of Directors
313
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
1. Company information Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
Tata Steel Limited (“the Company”) is a public limited Company
market participants at the measurement date.
incorporated in India with its registered office in Mumbai,
Maharashtra, India. The Company is listed on the BSE Limited (c) Use of estimates and critical accounting judgements
(BSE) and the National Stock Exchange of India Limited (NSE).
In the preparation of the consolidated financial statements, the
The Company and its subsidiaries (collectively referred to as Group makes judgements, estimates and assumptions about
‘the Group’) have presence across the entire value chain of steel the carrying values of assets and liabilities that are not readily
manufacturing from mining and processing iron ore and coal apparent from other sources. The estimates and associated
to producing and distributing finished products. The Group assumptions are based on historical experience and other
offers a broad range of steel products including a portfolio of factors that are considered to be relevant. Actual results may
high value- added downstream products such as hot rolled, cold differ from these estimates.
rolled & coated steel, rebars, wire rods, tubes and wires.
Estimates and underlying assumptions are reviewed on an
The consolidated financial statements as at March 31, 2019 ongoing basis. Revisions to accounting estimates are recognised
present the financial position of the Group as well as its interests in the period in which the estimate is revised and future
in associate companies and joint arrangements. The list of periods affected.
entities consolidated is provided in note 53, page 410.
Key source of estimation of uncertainty at the date of the
The functional and presentation currency of the Company and consolidated financial statements, which may cause material
the presentation currency of the Group is Indian Rupee (“`”). adjustment to the carrying amounts of assets and liabilities
within the next financial year, is in respect of impairment, useful
As on March 31, 2019, Tata Sons Private Limited owns 31.64%
lives of property, plant and equipment and intangible assets,
of the Ordinary Shares of the Company, and has the ability to
valuation of deferred tax assets, provisions and contingent
influence the Group’s operations.
liabilities, fair value measurements of financial instruments,
The consolidated financial statements for the year ended retirement benefit obligations and non-current assets classified
March 31, 2019 were approved by the Board of Directors and as held for sale as discussed below.
authorised for issue on April 25, 2019.
Impairment
2. Significant accounting policies The Group estimates the value in use of the cash generating
The significant accounting policies applied by the Group in the unit (CGU) based on future cash flows after considering current
preparation of its consolidated financial statements are listed economic conditions and trends, estimated future operating
below. Such accounting policies have been applied consistently results and growth rates and anticipated future economic and
to all the periods presented in these consolidated financial regulatory conditions. The estimated cash flows are developed
statements, unless otherwise indicated. using internal forecasts. The cash flows are discounted using a
suitable discount rate in order to calculate the present value.
(a) Statement of compliance Further details of the Group’s impairment review and key
The consolidated financial statements have been prepared in assumptions are set out in note 3, page 327, note 5, page 332
accordance with the Indian Accounting Standards (referred to and note 6, page 333.
as “Ind AS”) prescribed under Section 133 of the Companies
Act, 2013 read with Companies (Indian Accounting Standards) Useful lives of property, plant and equipment and
Rules, as amended from time to time and other relevant intangible assets
provisions of the Act.
The Group reviews the useful life of property, plant and
equipment and intangible assets at the end of each reporting
(b) Basis of preparation period. This reassessment may result in change in depreciation
The consolidated financial statements have been prepared and amortisation expense in future periods. The policy has been
under the historical cost convention with the exception of detailed in note 2(n), page 318.
certain assets and liabilities that are required to be carried at fair
values by Ind AS.
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) to assess whether the sale of the assets (or disposal group) is
highly probable.
Valuation of deferred tax assets
(d) Basis of consolidation
The Group reviews the carrying amount of deferred tax assets at
the end of each reporting period. The policy has been detailed The consolidated financial statements incorporate the financial
in note 2 (y), page 324 and its further information are set out in statements of the Company and entities controlled by the
note 12, page 342. Company i.e. its subsidiaries. It also includes the Group’s share of
profits, net assets and retained post acquisition reserves of joint
Provisions and contingent liabilities arrangements and associates that are consolidated using the
A provision is recognised when the Group has a present equity or proportionate method of consolidation, as applicable.
obligation as result of a past event and it is probable that the Control is achieved when the Company is exposed to, or has
outflow of resources will be required to settle the obligation, rights to the variable returns of the entity and the ability to affect
in respect of which a reliable estimate can be made. These are those returns through its power to direct the relevant activities
reviewed at each balance sheet date and adjusted to reflect the of the entity.
current best estimates. Contingent liabilities are not recognised
in the financial statements. Further details are set out in note 25, The results of subsidiaries, joint arrangements and associates
page 369 and note 39(A), page 389. acquired or disposed off during the year are included in the
consolidated statement of profit and loss from the effective
Fair value measurements of financial instruments date of acquisition or up to the effective date of disposal,
When the fair value of financial assets and financial liabilities as appropriate.
recorded in the balance sheet cannot be measured based on Wherever necessary, adjustments are made to the financial
quoted prices in active markets, their fair value is measured statements of subsidiaries, joint arrangements and associates to
using valuation techniques including Discounted Cash Flow bring their accounting policies in line with those used by other
Model. The inputs to these models are taken from observable members of the Group.
markets where possible, but where this is not feasible, a
degree of judgement is required in establishing fair value. Intra-group transactions, balances, income and expenses are
Judgements include considerations of inputs such as liquidity eliminated on consolidation.
risks, credit risks and volatility. Changes in assumptions about Non-controlling interests in the net assets of consolidated
these factors could affect the reported fair value of financial subsidiaries are identified separately from the Group’s equity.
instruments. Further details are set out in note 44, page 398. The interest of non-controlling shareholders may be initially
measured either at fair value or at the non-controlling interests’
Retirement benefit obligations
proportionate share of the fair value of the acquiree’s identifiable
The Group’s retirement benefit obligations are subject to a net assets. The choice of measurement basis is made on an
number of judgements including discount rates, inflation acquisition-by-acquisition basis. Subsequent to acquisition, the
and salary growth. Significant judgements are required when carrying value of non-controlling interests is the amount of those
setting these criteria and a change in these assumptions would interests at initial recognition plus the non-controlling interests’
have a significant impact on the amount recorded in the Group’s share of subsequent changes in equity. Total comprehensive
balance sheet and the consolidated statement of profit and loss. income is attributed to non-controlling interests even if it results
The Group sets these judgements based on previous experience in the non-controlling interests having a deficit balance.
and third party actuarial advice. Further details on the Group’s
retirement benefit obligations, including key judgements are (e) Business combinations
set out in note 38, page 378. Acquisition of subsidiaries and businesses are accounted for
using the acquisition method. The consideration transferred
Non-current assets held for sale
in each business combination is measured at the aggregate
The recognition of non-current assets (or disposal groups) as of the acquisition date fair values of assets given, liabilities
held for sale is dependent upon whether its carrying amount incurred by the Group to the former owners of the acquiree and
will be recovered principally through a sale transaction rather equity interests issued by the Group in exchange for control
than through continuing use. Significant judgement is required of the acquiree.
315
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) • researching and analysing existing exploration data
When the Group’s share of losses exceeds the carrying value
• conducting geological studies, exploratory
drilling and sampling
of the joint venture, the carrying value is reduced to nil and
recognition of further losses is discontinued, except to the • examining and testing extraction and treatment methods
extent that the Group has incurred obligations in respect of
the joint venture.
• compiling pre-feasibility and feasibility studies
Unrealised gains on transactions between the Group and its
• activities in relation to evaluating the technical feasibility and
commercial viability of extracting a mineral resource.
joint ventures are eliminated to the extent of the Group’s interest
in the joint venture, unrealised losses are also eliminated unless Administration and other overhead costs are charged to the cost
the transaction provides evidence of an impairment of the asset of exploration and evaluation assets only if directly related to an
transferred and where material, the results of joint ventures are exploration and evaluation project.
modified to confirm to the Group’s accounting policies.
If a project does not prove viable, all irrecoverable exploration
(i) Property, plant and equipment and evaluation expenditure associated with the project net
of any related impairment allowances is written off to the
An item of property, plant and equipment is recognised as an
consolidated statement of profit and loss.
asset if it is probable that future economic benefits associated
with the item will flow to the Group and its cost can be The Group measures its exploration and evaluation assets at cost
measured reliably. This recognition principle is applied to costs and classifies as property, plant and equipment or intangible
incurred initially to acquire an item of property, plant and assets according to the nature of the assets acquired and applies
equipment and also to costs incurred subsequently to add to, the classification consistently. To the extent that a tangible asset
replace part of, or service it. All other repair and maintenance is consumed in developing an intangible asset, the amount
costs, including regular servicing, are recognised in the reflecting that consumption is capitalised as a part of the cost of
consolidated statement of profit and loss as incurred. When a the intangible asset.
replacement occurs, the carrying value of the replaced part is
As the asset is not available for use, it is not depreciated.
de-recognised. Where an item of property, plant and equipment
All exploration and evaluation assets are monitored for
comprises major components having different useful lives,
indications of impairment. An exploration and evaluation asset
these components are accounted for as separate items.
is no longer classified as such when the technical feasibility
Property, plant and equipment is stated at cost or deemed cost and commercial viability of extracting a mineral resource are
applied on transition to Ind AS, less accumulated depreciation demonstrable and the development of the deposit is sanctioned
and impairment. Cost includes all direct costs and expenditures by the management. The carrying value of such exploration and
incurred to bring the asset to its working condition and location evaluation asset is reclassified to mining assets.
for its intended use. Trial run expenses (net of revenue) are
capitalised. Borrowing costs incurred during the period of (k) Development expenditure for mineral reserves
construction is capitalised as part of cost of qualifying asset.
Development is the establishment of access to mineral
reserves and other preparations for commercial
The gain or loss arising on disposal of an item of property, plant
production. Development activities often continue during
and equipment is determined as the difference between sale
production and include:
proceeds and carrying value of such item, and is recognised in
the consolidated statement of profit and loss. • sinking shafts and underground drifts (often called
mine development)
(j) Exploration for and evaluation of mineral resources
Expenditures associated with search for specific mineral
• making permanent excavations
resources are recognised as exploration and evaluation assets. • developing passageways and rooms or galleries
The following expenditure comprises the cost of exploration
and evaluation assets:
• building roads and tunnels and
• obtaining of the rights to explore and evaluate mineral • advance removal of overburden and waste rock.
reserves and resources including costs directly related to
this acquisition
317
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) (v) adequate technical, semi-financial and other resources to
complete the development and to use or sell the intangible
Development (or construction) also includes the installation asset are available.
of infrastructure (e.g., roads, utilities and housing), machinery,
(vi)
it is possible to reliably measure the expenditure
equipment and facilities.
attributable to the intangible asset during its development.
Development expenditure is capitalised and presented as part of
Recognition of costs as an asset is ceased when the project is
mining assets. No depreciation is charged on the development
complete and available for its intended use, or if these criteria
expenditure before the start of commercial production.
are no longer applicable.
(l) Provision for restoration and environmental costs Where development activities do not meet the conditions for
The Group has liabilities related to restoration of soil and other recognition as an asset, any associated expenditure is treated as
related works, which are due upon the closure of certain of an expense in the period in which it is incurred.
its mining sites.
Intangible assets acquired in a business combination are
Such liabilities are estimated case-by-case based on available identified and recognised separately from goodwill where they
information, taking into account applicable local legal satisfy the definition of an intangible asset and their fair values
requirements. The estimation is made using existing technology, can be measured reliably. The cost of such intangible assets is
at current prices, and discounted using an appropriate discount their fair value at the acquisition date.
rate where the effect of time value of money is material.
Subsequent to initial recognition, intangible assets with definite
Future restoration and environmental costs, discounted to
useful lives acquired in a business combination are reported
net present value, are capitalised and the corresponding
at cost or deemed cost applied on transition to Ind AS, less
restoration liability is raised as soon as the obligation to incur
accumulated amortisation and accumulated impairment losses.
such costs arises. Future restoration and environmental costs are
capitalised in property, plant and equipment or mining assets (n) Depreciation and amortisation of property, plant and
as appropriate and are depreciated over the life of the related equipment and intangible assets
asset. The effect of time value of money on the restoration and
Depreciation or amortisation is provided so as to write off, on
environmental costs liability is recognised in the consolidated
a straight-line basis, the cost/deemed cost of property, plant
statement of profit and loss.
and equipment and intangible assets, including those held
(m) Intangible assets under finance leases to their residual value. These charges
are commenced from the dates the assets are available for
Patents, trademarks and software costs are included in the
their intended use and are spread over their estimated useful
consolidated balance sheet as intangible assets when it is
economic lives or, in the case of leased assets, over the lease
probable that associated future economic benefits would flow
period, if shorter. The estimated useful lives of assets, residual
to the Group. In this case they are measured initially at purchase
values and depreciation method are reviewed regularly and,
cost and then amortised on a straight-line basis over their
when necessary, revised.
estimated useful lives. All other costs on patents, trademarks
and software are expensed in the consolidated statement of Depreciation on assets under construction commences only
profit and loss as and when incurred. when the assets are ready for their intended use.
Expenditure on research activities is recognised as an expense The estimated useful lives for the main categories of property,
in the period in which it is incurred. Costs incurred on individual plant and equipment and other intangible assets are:
development projects are recognised as intangible assets from
Estimated useful
the date when all of the following conditions are met: life (years)
(i) completion of the development is technically feasible. Freehold and long leasehold buildings upto 60 years*
Roads 5 years
(ii) it is the intention to complete the intangible asset and Plant and machinery upto 40 years*
use or sell it. Furniture, fixture and office equipments 3 to 25 years
(iii) ability to use or sell the intangible asset. Vehicles and aircraft 4 to 20 years
Railway sidings upto 35 years*
(iv) it is clear that the intangible asset will generate probable
future economic benefits.
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) carrying value does not exceed the carrying value that would
have been determined had no impairment loss been recognised
Estimated useful for the asset (or cash generating unit) in prior years. A reversal of
life (years) an impairment loss is recognised in the consolidated statement
Assets covered under the Electricity Act (life 3 to 34 years of profit and loss immediately.
as prescribed under the Electricity Act)
Patents and trademarks 4 years (p) Leases
Product and process development costs 5 years The Group determines whether an arrangement contains a
Computer software upto 8 years lease by assessing whether the fulfilment of a transaction is
Other assets 1 to 15 years dependent on the use of a specific asset and whether the
Mining assets are amortised over the useful life of the mine or transaction conveys the right to use that asset to the Group
lease period whichever is lower. in return for payment. Where this occurs, the arrangement
is deemed to include a lease and is accounted for either as a
Major furnace relining expenses are depreciated over a period of finance or an operating lease.
10 years (average expected life).
Leases are classified as finance leases where the terms of the
Freehold land is not depreciated. lease transfer substantially all the risks and rewards of ownership
* For these class of assets, based on internal assessment and to the lessee. All other leases are classified as operating leases.
independent technical evaluation carried out by chartered
The Group as lessee
engineers, the Company and some of its subsidiaries believe
that the useful lives as given above best represent the period (i) Operating lease – Rentals payable under operating leases are
over which such Company expects to use these assets. charged to the consolidated statement of profit and loss on
Hence the useful lives for these assets are different from the a straight-line basis over the term of the relevant lease unless
useful lives as prescribed under Part C of Schedule II of the another systematic basis is more representative of the time
Companies Act, 2013. pattern in which economic benefits from the leased assets
are consumed. Contingent rentals arising under operating
(o) Impairment leases are recognised as an expense in the period in which
At each balance sheet date, the Group reviews the carrying they are incurred.
value of its property, plant and equipment and intangible In the event that lease incentives are received to enter into
assets to determine whether there is any indication that the operating leases, such incentives are recognised as a liability.
carrying value of those assets may not be recoverable through The aggregate benefit of incentives is recognised as a reduction
continuing use. If any such indication exists, the recoverable of rental expense on a straight-line basis, except where another
amount of the asset is reviewed in order to determine the extent systematic basis is more representative of the time pattern in
of impairment loss, if any. Where the asset does not generate which economic benefits from the leased assets are consumed.
cash flows that are independent from other assets, the Group
estimates the recoverable amount of the cash generating unit (ii) Finance lease – Finance leases are capitalised at the
to which the asset belongs. commencement of lease, at the lower of the fair value of the
assets or the present value of the minimum lease payments.
Recoverable amount is the higher of fair value less costs to sell The corresponding liability to the lessor is included in the
and value in use. In assessing value in use, the estimated future consolidated balance sheet as a finance lease obligation.
cash flows are discounted to their present value using a pre-tax Lease payments are apportioned between finance charges and
discount rate that reflects current market assessments of the reduction of the lease obligation so as to achieve a constant
time value of money and the risks specific to the asset for which rate of interest on the remaining balance of the liability.
the estimates of future cash flows have not been adjusted. Finance charges are recognised in the consolidated statement
An impairment loss is recognised in the consolidated statement of profit and loss over the period of the lease.
of profit and loss as and when the carrying value of an asset
exceeds its recoverable amount. The Group as lessor
Where an impairment loss subsequently reverses, the carrying (i) Operating lease – Rental income from operating leases is
value of the asset (or cash generating unit) is increased to the recognised in the consolidated statement of profit and loss on
revised estimate of its recoverable amount, so that the increased a straight-line basis over the term of the relevant lease unless
319
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) • thepits are operated as separate units in terms of mine
planning and the sequencing of overburden and ore mining,
another systematic basis is more representative of the time rather than as an integrated unit
pattern in which economic benefits from the leased asset is
diminished. Initial direct costs incurred in negotiating and
• expenditurefor additional infrastructure to support the
second and subsequent pits are relatively large
arranging an operating lease are added to the carrying value
of the leased asset and recognised on a straight-line basis over • the pits extract ore from separate and distinct ore bodies,
the lease term. rather than from a single ore body.
(ii) Finance lease – When assets are leased out under a finance lease, The relative importance of each factor is considered by the
the present value of minimum lease payments is recognised as a management to determine whether, the stripping costs should
receivable. The difference between the gross receivable and the be attributed to the individual pit or to the combined output
present value of receivable is recognised as unearned finance from the several pits.
income. Lease income is recognised over the term of the lease
Production stripping costs are incurred to extract the ore in the
using the net investment method before tax, which reflects a
form of inventories and/or to improve access to an additional
constant periodic rate of return.
component of an ore body or deeper levels of material.
(q) Stripping costs Production stripping costs are accounted for as inventories
to the extent the benefit from production stripping activity is
The Group separates two different types of stripping costs that
realised in the form of inventories.
are incurred in surface mining activity:
The Group recognises a stripping activity asset in the production
• developmental stripping costs and phase if, and only if, all of the following are met:
• production stripping costs • it is probable that the future economic benefit (improved
Developmental stripping costs which are incurred in order access to the ore body) associated with the stripping activity
to obtain access to quantities of mineral reserves that will be will flow to the Group
mined in future periods are capitalised as part of mining assets.
Capitalisation of developmental stripping costs ends when the
• the Group can identify the component of the ore body for
which access has been improved and
commercial production of the mineral reserves begins.
A mine can operate several open pits that are regarded
• the costs relating to the improved access to that component
can be measured reliably.
as separate operations for the purpose of mine planning
and production. In this case, stripping costs are accounted Such costs are presented within mining assets. After initial
for separately, by reference to the ore extracted from each recognition, stripping activity assets are carried at cost/deemed
separate pit. If, however, the pits are highly integrated for the cost applied on transition to Ind AS, less accumulated
purpose of mine planning and production, stripping costs are amortisation and impairment. The expected useful life of the
aggregated too. identified component of the ore body is used to depreciate or
amortise the stripping asset.
The determination of whether multiple pit mines are considered
separate or integrated operations depends on each mines (r) Financial instruments
specific circumstances. The following factors normally point
Financial assets and financial liabilities are recognised when
towards the stripping costs for the individual pits being
the Group becomes a party to the contractual provisions of the
accounted for separately:
instrument. Financial assets and liabilities are initially measured
• miningof the second and subsequent pits is conducted at fair value. Transaction costs that are directly attributable to
consecutively with that of the first pit, rather than concurrently the acquisition or issue of financial assets and financial liabilities
(other than financial assets and financial liabilities at fair value
• separate investment decisions are made to develop
through profit or loss) are added to or deducted from the
each pit, rather than a single investment decision being
fair value measured on initial recognition of financial asset or
made at the outset
financial liability. The transaction costs directly attributable to
the acquisition of financial assets and financial liabilities at fair
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) instrument by instrument basis at the time of initial recognition
of such equity investments. These investments are held for
value through profit and loss are immediately recognised in the medium or long-term strategic purpose. The Group has chosen
consolidated statement of profit and loss. to designate these investments in equity instruments as fair
value through other comprehensive income as the management
Effective interest method believes this provides a more meaningful presentation for
The effective interest method is a method of calculating the medium or long-term strategic investments, than reflecting
amortised cost of a financial instrument and of allocating interest changes in fair value immediately in the consolidated statement
income or expense over the relevant period. The effective of profit and loss.
interest rate is the rate that exactly discounts future cash
Financial assets not measured at amortised cost or at fair value
receipts or payments through the expected life of the financial
through other comprehensive income are carried at fair value
instrument, or where appropriate, a shorter period.
through profit and loss.
(I) Financial assets
Interest income
Cash and bank balances
Interest income is accrued on a time proportion basis, by
Cash and bank balances consist of: reference to the principal outstanding and effective interest
rate applicable.
(i) Cash and cash equivalents - which include cash on hand,
deposits held at call with banks and other short-term Dividend income
deposits which are readily convertible into known
Dividend income from investments is recognised when the right
amounts of cash, are subject to an insignificant risk of
to receive payment has been established.
change in value and have original maturities of less than
one year. These balances with banks are unrestricted for Impairment of financial assets
withdrawal and usage.
Loss allowance for expected credit losses is recognised for
(ii) Other bank balances - which include balances and deposits financial assets measured at amortised cost and fair value
with banks that are restricted for withdrawal and usage. through other comprehensive income.
Financial assets at amortised cost The Group recognises lifetime expected credit losses for all trade
receivables that do not constitute a financing transaction.
Financial assets are subsequently measured at amortised cost if
these financial assets are held within a business model whose For financial assets (apart from trade receivables that do not
objective is to hold these assets in order to collect contractual constitute a financing transaction) whose credit risk has not
cash flows and the contractual terms of the financial asset give significantly increased since initial recognition, loss allowance
rise on specified dates to cash flows that are solely payments of equal to twelve months expected credit losses is recognised.
principal and interest on the principal amount outstanding. Loss allowance equal to the lifetime expected credit losses is
recognised if the credit risk on the financial asset has significantly
Financial assets measured at fair value increased since initial recognition.
Financial assets are measured at fair value through other
comprehensive income if these financial assets are held within De-recognition of financial assets
a business model whose objective is to hold these assets in
The Group de-recognises a financial asset only when the
order to collect contractual cash flows or to sell these financial contractual rights to the cash flows from the asset expire, or
assets and the contractual terms of the financial asset give rise it transfers the financial asset and substantially all risks and
on specified dates to cash flows that are solely payments of rewards of ownership of the asset to another entity.
principal and interest on the principal amount outstanding.
If the Group neither transfers nor retains substantially all the
The Group in respect of certain equity investments (other than in risks and rewards of ownership and continues to control the
associates and joint ventures) which are not held for trading has transferred asset, the Group recognises its retained interest in the
made an irrevocable election to present in other comprehensive assets and an associated liability for amounts it may have to pay.
income subsequent changes in the fair value of such equity
If the Group retains substantially all the risks and rewards of
instruments. Such an election is made by the Group on an
ownership of a transferred financial asset, the Group continues
321
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) Derivatives are initially accounted for and measured at fair value
from the date the derivative contract is entered into and are
to recognise the financial asset and also recognises a borrowing subsequently re-measured to their fair value at the end of each
for the proceeds received. reporting period.
(II) Financial liabilities and equity instruments The Group adopts hedge accounting for forward, interest rate
and commodity contracts wherever possible. At the inception
Classification as debt or equity of each hedge, there is a formal, documented designation of
Financial liabilities and equity instruments issued by the Group the hedging relationship. This documentation includes, inter
are classified according to the substance of the contractual alia, items such as identification of the hedged item transaction
arrangements entered into and the definitions of a financial and nature of the risk being hedged. At inception, each hedge
liability and an equity instrument. is expected to be highly effective in achieving an offset of
changes in fair value or cash flows attributable to the hedged
Equity instruments risk. The effectiveness of hedge instruments to reduce the
An equity instrument is any contract that evidences a residual risk associated with the exposure being hedged is assessed
interest in the assets of the Group after deducting all of its and measured at the inception and on an ongoing basis.
liabilities. Equity instruments are recorded at the proceeds The ineffective portion of designated hedges is recognised
received, net of direct issue costs. immediately in the consolidated statement of profit and loss.
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) bringing the inventories to their present location and condition.
Net realisable value is the price at which the inventories can
gain or loss on the hedging instrument recognised in equity be realised in the normal course of business after allowing for
is retained in equity until the forecasted transaction occurs. the cost of conversion from their existing state to a finished
If a hedged transaction is no longer expected to occur, the net condition and for the cost of marketing, selling and distribution.
cumulative gain or loss recognised in equity is transferred to the
Provisions are made to cover slow-moving and obsolete items
consolidated statement of profit and loss for the period.
based on historical experience of utilisation on a product
(s) Employee benefits category basis, which involves individual businesses considering
their product lines and market conditions.
Defined contribution plans
Contributions under defined contribution plans are recognised (u) Provisions
as an expense for the period in which the employee has Provisions are recognised in the consolidated balance sheet when
rendered the service. Payments made to state managed the Group has a present obligation (legal or constructive) as a
retirement benefit schemes are dealt with as payments to result of a past event, which is expected to result in an outflow of
defined contribution schemes where the Group’s obligations resources embodying economic benefits which can be reliably
under the schemes are equivalent to those arising in a defined estimated. Each provision is based on the best estimate of the
contribution retirement benefit scheme. expenditure required to settle the present obligation at the
balance sheet date. Where the time value of money is material,
Defined benefit plans provisions are measured on a discounted basis.
For defined benefit retirement schemes, the cost of providing
Constructive obligation is an obligation that derives from an
benefits is determined using the Projected Unit Credit Method,
entity’s actions where:
with actuarial valuation being carried out at each year-end
balance sheet date. Re-measurement gains and losses of the net (i)
by an established pattern of past practice, published
defined benefit liability/(asset) are recognised immediately in policies or a sufficiently specific current statement, the
other comprehensive income. The service cost and net interest entity has indicated to other parties that it will accept
on the net defined benefit liability/(asset) are recognised as an certain responsibilities and
expense within employee costs.
(ii) as a result, the entity has created a valid expectation on
Past service cost is recognised as an expense when the plan the part of those other parties that it will discharge those
amendment or curtailment occurs or when any related responsibilities.
restructuring costs or termination benefits are recognised,
whichever is earlier. (v) Onerous contracts
A provision for onerous contracts is recognised when the
The retirement benefit obligations recognised in the
expected benefits to be derived by the Group from a contract are
consolidated balance sheet represents the present value of
lower than the unavoidable cost of meeting its obligations under
the defined benefit obligations as reduced by the fair value
the contract. The provision is measured at the present value of
of plan assets.
the lower of the expected cost of terminating the contract and
Compensated absences the expected net cost of continuing with the contract. Before a
provision is established, the Group recognises any impairment
Compensated absences which are not expected to occur
loss on the assets associated with that contract.
within twelve months after the end of the period in which the
employee renders the related service are recognised based on (w) Government grants
actuarial valuation at the present value of the obligations as on
Government grants are recognised at its fair value, where
the reporting date.
there is a reasonable assurance that such grants will be
(t) Inventories received and compliance with the conditions attached
therewith have been met.
Inventories are stated at the lower of cost and net realisable
value. Cost is ascertained on a weighted average basis. Government grants related to expenditure on property, plant
Costs comprise direct materials and, where applicable, direct and equipment are credited to the consolidated statement of
labour costs and those overheads that have been incurred in profit and loss over the useful lives of qualifying assets or other
323
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) used in the computation of taxable profit, and is accounted for
using the balance sheet liability method. Deferred tax liabilities
systematic basis representative of the pattern of fulfilment of are generally recognised for all taxable temporary differences.
obligations associated with the grant received. Grants received In contrast, deferred tax assets are only recognised to the extent
less amounts credited to the consolidated statement of profit that it is probable that future taxable profits will be available
and loss at the reporting date are included in the consolidated against which the temporary differences can be utilised.
balance sheet as deferred income.
Deferred tax liabilities are recognised on taxable temporary
(x) Non-current assets held for sale and discontinued differences arising on investments in subsidiaries, joint ventures
operations and associates, except where the Group is able to control the
reversal of the temporary difference and it is probable that the
Non-current assets and disposal groups classified as held for sale
temporary difference will not reverse in the foreseeable future.
are measured at the lower of their carrying value and fair value
less costs to sell. The carrying value of deferred tax assets is reviewed at the end
of each reporting period and reduced to the extent that it is no
Assets and disposal groups are classified as held for sale if their
longer probable that sufficient taxable profits will be available
carrying value will be recovered through a sale transaction
to allow all or part of the asset to be recovered.
rather than through continuing use. This condition is only met
when the sale is highly probable and the asset, or disposal Deferred tax is calculated at the tax rates that are expected to
group, is available for immediate sale in its present condition apply in the period when the liability is settled or the asset is
and is marketed for sale at a price that is reasonable in relation realised based on the tax rates and tax laws that have been
to its current fair value. The Group must also be committed to enacted or substantially enacted by the end of the reporting
the sale, which should be expected to qualify for recognition as period. The measurement of deferred tax liabilities and assets
a completed sale within one year from the date of classification. reflects the tax consequences that would follow from the
manner in which the Group expects, at the end of the reporting
Where a disposal group represents a separate major line of
period, to recover or settle the carrying value of its assets
business or geographical area of operations, or is part of a
and liabilities.
single coordinated plan to dispose of a separate major line of
business or geographical area of operations, then it is treated Deferred tax assets and liabilities are offset to the extent that
as a discontinued operation. The post-tax profit or loss of they relate to taxes levied by the same tax authority and they
the discontinued operation together with the gain or loss are in the same taxable entity, or a Group of taxable entities
recognised on its disposal are disclosed as a single amount in the where the tax losses of one entity are used to offset the taxable
consolidated statement of profit and loss, with all prior periods profits of another and there are legally enforceable rights
being presented on this basis. to set off current tax assets and current tax liabilities within
that jurisdiction.
(y) Income taxes
Current and deferred tax are recognised as an expense or
Tax expense for the year comprises of current and deferred
income in the consolidated statement of profit and loss, except
tax. The tax currently payable is based on taxable profit for the
when they relate to items credited or debited either in other
year. Taxable profit differs from net profit as reported in the
comprehensive income or directly in equity, in which case
consolidated statement of profit and loss because it excludes
the tax is also recognised in other comprehensive income or
items of income or expense that are taxable or deductible in
directly in equity.
other years and it further excludes items that are never taxable
or deductible. The Group’s liability for current tax is calculated Deferred tax assets include Minimum Alternate Tax (MAT) paid
using tax rates and tax laws that have been enacted or in accordance with the tax laws in India, which is likely to give
substantively enacted in countries where the Company and its future economic benefits in the form of availability of set off
subsidiaries operate by the end of the reporting period. against future income tax liability. MAT is recognised as deferred
tax assets in the consolidated balance sheet when the asset can
Deferred tax is the tax expected to be payable or recoverable on
be measured reliably and it is probable that the future economic
differences between the carrying value of assets and liabilities
benefit associated with the asset will be realised.
in the financial statements and the corresponding tax bases
NOTES
forming part of the consolidated financial statements
2. Significant accounting policies (Contd.) established by the respective regulatory authorities. The Group
doesn’t recognise revenue and an asset for cost incurred in the
(z) Revenue past that will be recovered.
The Group manufactures and sells a range of steel and
(aa) Foreign currency transactions and translation
other products.
The consolidated financial statements of the Group are
Effective April 1, 2018, the Group has applied Ind AS 115 which presented in (‘`'), which is the functional currency of the
establishes a comprehensive framework for determining Company and the presentation currency for the consolidated
whether, how much and when revenue is to be recognised. financial statements.
Ind AS 115 replaces Ind AS 18 Revenue and Ind AS 11
Construction Contracts. The Group has adopted Ind AS 115 In preparing the consolidated financial statements, transactions
using the retrospective effect method. The adoption of the new in currencies other than the entity’s functional currency are
standard did not have a material impact on the Group. recorded at the rates of exchange prevailing on the date of
the transaction. At the end of each reporting period, monetary
Sale of products items denominated in foreign currencies are re-translated
Revenue from sale of products is recognised when control of the at the rates prevailing at the end of the reporting period.
products has transferred, being when the products are delivered Non-monetary items carried at fair value that are denominated in
to the customer. Delivery occurs when the products have been foreign currencies are re-translated at the rates prevailing on the
shipped or delivered to the specific location as the case may be, date when the fair value was determined. Non-monetary items
the risk of loss has been transferred, and either the customer has that are measured in terms of historical cost in a foreign currency
accepted the products in accordance with the sales contract, or are not translated.
the Group has objective evidence that all criteria for acceptance Exchange differences arising on translation of long-term foreign
have been satisfied. Sale of products include related ancillary currency monetary items recognised in the consolidated financial
services, if any. statements before the beginning of the first Ind AS financial
Goods are often sold with volume discounts based on aggregate reporting period in respect of which the Group has elected to
sales over a 12 months period. Revenue from these sales is recognise such exchange differences in equity or as part of cost
recognised based on the price specified in the contract, net of of assets as allowed under Ind As 101-“First-time adoption of
the estimated volume discounts. Accumulated experience is Indian Accounting Standards” are recognised directly in equity
used to estimate and provide for the discounts, using the most or added/deducted to/from the cost of assets as the case may
likely method, and revenue is only recognised to the extent that be. Such exchange differences recognised in equity or as part
it is highly probable that a significant reversal will not occur. of cost of assets is recognised in the consolidated statement of
A liability is recognised for expected volume discounts payable profit and loss on a systematic basis.
to customers in relation to sales made until the end of the Exchange differences arising on the re-translation or settlement
reporting period. No element of financing is deemed present of other monetary items are included in the consolidated
as the sales are generally made with a credit term of 30-90 statement of profit and loss for the period.
days, which is consistent with market practice. Any obligation
to provide a refund is recognised as a provision. A receivable is For the purpose of presenting the consolidated financial
recognised when the goods are delivered as this is the point in statements, the assets and liabilities of the Company’s foreign
time that the consideration is unconditional because only the subsidiaries, associates and joint ventures are expressed in
passage of time is required before the payment is due. ` using exchange rates prevailing at the end of the reporting
period. Income and expense items are translated at the
The Group does not have any contracts where the period average exchange rates for the period. Exchange differences
between the transfer of the promised goods or services to the arising, if any, are recognised in other comprehensive income
customer and payment by the customer exceeds one year. As a and accumulated in a separate component of equity. On the
consequence, the Group does not adjust any of the transaction disposal of a foreign operation, all of the accumulated exchange
prices for the time value of money. differences in respect of that operation attributable to the
Company are reclassified to the consolidated statement of
Sale of power
profit and loss.
Revenue from sale of power is recognised when the services
are provided to the customer based on approved tariff rates
325
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
NOTES
forming part of the consolidated financial statements
327
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
Land Buildings Plant and Furniture, Vehicles Leased Railway Total
including machinery fixtures FFOE and sidings
roads and office vehicles
equipments
(FFOE)
Cost/deemed cost as at April 1, 2017 16,545.43 11,141.07 93,461.77 543.43 351.68 0.69 1,349.53 1,23,393.60
Addition relating to acquisitions 7.90 15.53 882.70 0.91 0.41 - - 907.45
Additions 65.67 334.24 5,917.97 110.46 28.07 - 32.94 6,489.35
Disposals (33.48) (60.58) (555.88) (10.52) (39.35) - - (699.81)
Classified as held for sale - - (0.67) - - - - (0.67)
Other re-classifications - - 44.16 - - - - 44.16
Exchange differences on consolidation 369.71 717.56 5,139.38 23.67 1.89 0.09 14.76 6,267.06
Cost/deemed cost as at March 31, 2018 16,955.23 12,147.82 1,04,889.43 667.95 342.70 0.78 1,397.23 1,36,401.14
Accumulated impairment as at April 1, 2017 273.45 249.73 1,980.46 3.67 0.26 - 15.43 2,523.00
Charge for the year 7.06 23.99 91.36 0.57 0.12 - - 123.10
Disposals - (30.10) (66.53) (0.03) - - - (96.66)
Other re-classifications - - 27.34 - - - - 27.34
Exchange differences on consolidation 41.78 39.49 270.22 0.60 0.10 - 2.15 354.34
Accumulated impairment as at March 31, 2018 322.29 283.11 2,302.85 4.81 0.48 - 17.58 2,931.12
Accumulated depreciation as at April 1, 2017 397.54 3,698.14 29,245.93 332.58 170.85 0.29 144.68 33,990.01
Charge for the year 106.13 444.28 4,983.82 88.70 32.35 0.02 57.60 5,712.90
Disposals (0.02) (12.84) (392.05) (10.30) (23.38) - - (438.59)
Classified as held for sale - - (0.10) - - - - (0.10)
Other re-classifications - 2.86 (2.95) 0.09 0.82 - - 0.82
Exchange differences on consolidation 1.44 474.91 3,387.66 8.20 0.78 0.05 9.16 3,882.20
Accumulated depreciation as at March 31, 2018 505.09 4,607.35 37,222.31 419.27 181.42 0.36 211.44 43,147.24
Total accumulated depreciation and 827.38 4,890.46 39,525.16 424.08 181.90 0.36 229.02 46,078.36
impairment as at March 31, 2018
Net carrying value as at April 1, 2017 15,874.44 7,193.20 62,235.38 207.18 180.57 0.40 1,189.42 86,880.59
Net carrying value as at March 31, 2018 16,127.85 7,257.36 65,364.27 243.87 160.80 0.42 1,168.21 90,322.78
16,220.07 16,127.85
NOTES
forming part of the consolidated financial statements
16,490.56 7,257.36
(` crore)
As at As at
March 31, 2019 March 31, 2018
Assets held under finance leases
Cost/deemed cost 5,416.13 4,565.81
Accumulated depreciation and impairment 2,505.72 2,300.73
2,910.41 2,265.08
84,013.58 65,364.27
(iv) Net carrying value of furniture, fixtures and office equipments comprises of:
(` crore)
As at As at
March 31, 2019 March 31, 2018
Furniture and fixtures
Cost/deemed cost 216.87 173.14
Accumulated depreciation and impairment 147.65 118.17
69.22 54.97
Office equipments
Cost/deemed cost 522.62 494.81
Accumulated depreciation and impairment 328.93 305.91
193.69 188.90
262.91 243.87
(v) `206.01 crore (2017-18: `115.35 crore) of borrowing costs has been capitalised during the year on qualifying assets under construction.
The capitalisation rate ranges between 7.00% to 9.80% (2017-18: 0.20% to 9.00%).
329
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(vi) Rupee liability has increased by `108.32 crore (2017-18: `44.16 crore) arising out of retranslation of the value of long-term foreign currency
loans and liabilities for procurement of property, plant and equipment, generally plant and machinery. This increase is adjusted against
the carrying cost of assets and depreciated over their remaining useful life. The depreciation for the current year is higher by `3.57 crore
(2017-18: `1.40 crore) on account of this adjustment.
(vii) During the year, the Group recognised a net impairment charge of `118.08 crore (2017-18: `1,161.93 crore) for property, plant and
equipment including capital work-in-progress. The impairment charge was primarily contained in the Indian and European Operations.
Within the Indian operations, the Group has recognised an impairment charge of `8.54 crore (2017-18: `33.99 crore) in respect
of expenditure incurred at one of its mining sites. The impairment recognised is included within other expenses in the consolidated
statement of profit and loss.
Within the European business, consistent with annual test for impairment of goodwill as at March 31, 2019, property, plant and equipment
(including capital work-in-progress) were also tested for impairment as at that date where indicators of impairment existed. The outcome of
the test indicated that the value in use of certain downstream and distribution businesses against which the property, plant and equipment
(including capital work-in-progress) is included, using a discount rate of 8.20% p.a. (2017-18: 8.20% p.a.) was lower than its carrying value
due to losses generated during the year in those CGU’s and/or forecasting losses in the annual plan. Accordingly, an impairment charge
of `106.68 crore (2017-18: `223.25 crore) was recognised. The impairment recognised is included within other expenses in the
consolidated statement of profit and loss.
During the year ended March 31, 2018, within the overseas mining businesses, volatility in commodity prices triggered an impairment
assessment for mining operations carried out by the Group in Canada. This resulted in an impairment charge of `903.01 crore being
recognised during the year ended March 31, 2018. The recoverable value was based on value in use using cash flow projections for 16
years and a discount rate of 8.00% p.a. The impairment recognised is included within exceptional items in the consolidated statement of
profit and loss.
The balance impairment charge recognised during the year ended March 31, 2019 amounting to `2.86 crore (2017-18: `1.68 crore) relates
to other businesses within the Group.
The Group has conducted sensitivity analysis on the impairment tests of the carrying value in respect of Group’s CGUs and property,
plant and equipment. The management believes that no reasonably possible change in any of the key assumptions used in the value
in use calculations would cause the carrying value of property, plant and equipment in any CGU to materially exceed its value in use,
other than in respect of the remaining property, plant and equipment at the Strip Products UK business which had a carrying value as at
March 31, 2019 of `3,358.46 crore (2017-18: `2,343.69 crore) and at the overseas Canadian mining business which had a carrying value
as at March 31, 2019 of `6,175.14 crore (2017-18: `5,282.61 crore). At the Strips product UK business site, the value in use is dependent
on sustaining the improvement to UK Steel market margins and the implementation of a business transformation plan. For the Canadian
mining operations, the value in use is dependent on improvement in commodity prices and realisation of cost savings in operation.
A reasonably possible change in any of these key assumptions would increase the likelihood of impairment losses in the future.
(viii) The details of property, plant and equipment pledged against borrowings is presented in note 23, page 363.
4. Leases
The Group has taken certain land, buildings, plant and machinery under operating and/or finance leases. The following is a summary of
the future minimum lease rental payments under non-cancellable operating leases and finance leases entered into by the Group.
A. Operating leases:
Significant leasing arrangements include lease of land for periods ranging between 12 to 99 years renewable on mutual consent, lease
of office spaces, assets dedicated for use under long-term arrangements and time charter hire vessels with lease period varying from
2 to 7 years. Payments under long-term arrangements involving use of dedicated assets are allocated between those relating to the
NOTES
forming part of the consolidated financial statements
4. Leases (Contd.)
right to use of assets, executory services and for output based on the underlying contractual terms and conditions. Any change in the
allocation assumptions may have an impact on lease assessment and/or lease classification. Payments linked to changes in inflation index
under lease arrangements have been considered as contingent rent and recognised in the consolidated statement of profit and loss as
and when incurred.
Future minimum lease payments under non-cancellable operating leases are as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
Not later than one year 930.01 737.29
Later than one year but not later than five years 1,858.83 1,504.98
Later than five years 1,521.88 1,508.37
4,310.72 3,750.64
uring the year ended March 31, 2019, total operating lease rental expense recognised in the consolidated statement of profit and loss was
D
`1,713.86 crore (2017-18: `790.41 crore) including contingent rent of `49.27 crore (2017-18 `31.20 crore).
B. Finance leases:
Significant leasing arrangements include assets dedicated for use under long-term arrangements. The arrangements cover a substantial part
of the economic life of the underlying asset and generally contain a renewal option on expiry. Payments under long-term arrangements
involving use of dedicated assets are allocated between those relating to the right to use of assets, executory services and for output based on
the underlying contractual terms and conditions. Any change in the allocation assumptions may have an impact on lease assessment and/or
lease classification.
T he minimum lease payments and such payments excluding future finance charges in respect of arrangements classified as finance
leases is as below:
(` crore)
As at March 31, 2019 As at March 31, 2018
Minimum lease Minimum lease Minimum lease Minimum lease
payments payments less payments payments less
future finance future finance
charges charges
Not later than one year 856.43 394.46 652.42 252.31
Later than one year but not later than five years 2,730.94 1,436.64 2,076.10 832.86
Later than five years 3,654.66 2,022.20 4,481.29 2,035.94
Total future minimum lease commitments 7,242.03 3,853.30 7,209.81 3,121.11
Less: Future finance charges 3,388.73 4,088.70
Present value of minimum lease commitments 3,853.30 3,121.11
Disclosed as:
Borrowings-non-current (refer note 23, page 363) 3,458.84 2,868.80
Other financial liabilities - Current (refer note 24, page 368) 394.46 252.31
3,853.30 3,121.11
331
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
5. Goodwill on consolidation
[Item No. I(c), Page 306]
(` crore)
As at As at
March 31, 2019 March 31, 2018
Cost as at beginning of the year 5,517.55 4,740.30
Addition relating to acquisitions - 142.43
Disposal of group undertakings (28.47) -
Exchange differences on consolidation (100.95) 634.82
Cost as at end of the year 5,388.13 5,517.55
Impairment as at beginning of the year 1,418.10 1,245.57
Exchange differences on consolidation (26.59) 172.53
Impairment as at end of the year 1,391.51 1,418.10
Net book value as at beginning of the year 4,099.45 3,494.73
Net book value as at end of the year 3,996.62 4,099.45
(i) Disposal of group undertakings relates to Black Ginger 461 (Proprietary) Ltd, a subsidiary of the Group disposed off during the year ended
March 31, 2019. Detailed disclosure in respect of the disposal is provided in note 42, page 395.
Addition to goodwill during the year ended March 31, 2018 relates to the acquisition of the remaining 74% equity stake by the Group in
one of its joint venture “Bhubaneshwar Power Private Limited “. The goodwill relates to synergies from combining the acquiree activities
with those of the Group to meet the growing demand for power.
(ii) The carrying value of goodwill predominantly relates to the goodwill that arose on the acquisition of erstwhile Corus Group Plc. and has
been tested against the recoverable amount of Strip Products Mainland Europe cash generating unit (CGU) by the Group. This goodwill
relates to expected synergies from combining Corus’ activities with those of the Group and to assets, which could not be recognised as
separately identifiable intangible assets. The goodwill is tested annually and for impairment more frequently if there are any indications
that the goodwill may be impaired. The recoverable amount of Strip Products Mainland Europe CGU has been determined from a value
in use calculation. The calculation uses cash flow forecasts based on the most recently approved financial budgets and strategic forecasts
which cover a period of three years and future projections taking the analysis out to 15 years. Key assumptions for the value in use
calculation are those regarding expected changes to selling prices and raw material costs, steel demand in European Union, exchange
rates and a discount rate of 8.20% p.a. (March 31, 2018: 8.20% p.a.). Changes in selling prices, raw material costs, exchange rates and EU
steel demand are based on expectations of future changes in the steel market based on external market sources. A Nil (March 31, 2018: Nil)
growth rate is used to extrapolate the cash flow projections beyond the three-year period of the financial budgets to 15 years. The pre-tax
discount rate is derived from the Tata Steel Europe (TSE) weighted average cost of capital (WACC) and the WACCs of its main European
steel competitors. The outcome of the Group’s goodwill impairment test as at March 31, 2019 for the Strip Products Mainland Europe CGU
resulted in no impairment of goodwill (March 31, 2018: Nil).
The management believes that no reasonably possible change in any of the key assumptions used in the value in use calculation would
cause the carrying value of the CGU to materially exceed its value in use.
.
NOTES
forming part of the consolidated financial statements
(` crore)
Patents Development Software Mining Other Total
and costs costs assets intangible
trademarks assets
Cost/deemed cost as at April 1, 2018 13.99 278.81 530.68 2,517.52 184.17 3,525.17
Addition relating to acquisitions - - 0.10 - 512.80 512.90
Additions 16.00 - 90.16 185.47 0.84 292.47
Disposals (1.19) - (24.23) - - (25.42)
Disposal of group undertakings - - (0.45) (236.09) - (236.54)
Classified as held for sale - - (24.86) - - (24.86)
Other re-classifications - - 3.03 - - 3.03
Exchange differences on consolidation (0.36) (10.53) (4.88) 7.07 - (8.70)
Cost/deemed cost as at March 31, 2019 28.44 268.28 569.55 2,473.97 697.81 4,038.05
Accumulated impairment as at April 1, 2018 - - 0.47 125.61 30.65 156.73
Charge for the year 11.36 - 21.70 3.06 - 36.12
Exchange differences on consolidation (0.13) - (0.46) 6.77 - 6.18
Accumulated impairment as at March 31, 2019 11.23 - 21.71 135.44 30.65 199.03
Accumulated amortisation as at April 1, 2018 9.34 224.34 310.79 1,103.91 37.40 1,685.78
Charge for the year 0.53 29.44 92.51 148.98 40.90 312.36
Disposals (0.63) - (24.23) - - (24.86)
Disposal of group undertakings - - (0.31) (93.08) - (93.39)
Classified as held for sale - - (18.75) - - (18.75)
Other re-classifications - - (1.00) - - (1.00)
Exchange differences on consolidation (0.07) (9.60) (0.56) (5.21) - (15.44)
Accumulated amortisation as at March 31, 2019 9.17 244.18 358.45 1,154.60 78.30 1,844.70
Total accumulated amortisation and impairment 20.40 244.18 380.16 1,290.04 108.95 2,043.73
as at March 31, 2019
Net carrying value as at April 1, 2018 4.65 54.47 219.42 1,288.00 116.12 1,682.66
Net carrying value as at March 31, 2019 8.04 24.10 189.39 1,183.93 588.86 1,994.32
333
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
Patents Development Software Mining Other Total
and costs costs assets intangible
trademarks assets
Cost/deemed cost as at April 1, 2017 10.16 239.22 425.29 2,399.45 93.94 3,168.06
Addition relating to acquisitions - - 0.02 - 90.20 90.22
Additions 2.31 - 83.99 82.61 0.03 168.94
Disposals - - (5.61) - - (5.61)
Exchange differences on consolidation 1.52 39.59 26.99 35.46 - 103.56
Cost/deemed cost as at March 31, 2018 13.99 278.81 530.68 2,517.52 184.17 3,525.17
Accumulated impairment as at April 1, 2017 - - 0.42 122.57 30.65 153.64
Exchange differences on consolidation - - 0.05 3.04 - 3.09
Accumulated impairment as at March 31, 2018 - - 0.47 125.61 30.65 156.73
Accumulated amortisation as at April 1, 2017 7.71 159.29 241.36 948.12 26.71 1,383.19
Charge for the year 0.64 36.14 66.39 147.80 10.69 261.66
Disposals - - (5.54) - - (5.54)
Exchange differences on consolidation 0.99 28.91 8.58 7.99 - 46.47
Accumulated amortisation as at March 31, 2018 9.34 224.34 310.79 1,103.91 37.40 1,685.78
Total accumulated amortisation and impairment 9.34 224.34 311.26 1,229.52 68.05 1,842.51
as at March 31, 2018
Net carrying value as at April 1, 2017 2.45 79.93 183.51 1,328.76 36.58 1,631.23
Net carrying value as at March 31, 2018 4.65 54.47 219.42 1,288.00 116.12 1,682.66
(i) Mining assets represent expenditure incurred in relation to acquisition of mines, mine development expenditure post establishment of
technical and commercial feasibility and restoration obligations as per applicable regulations.
(ii) During the year ended March 31, 2019, the Group recognised an impairment charge of `68.39 crore (2017-18: Nil) in respect of intangible
assets including intangible assets under development. The impairment is split as: Indian operations `5.24 crore (2017-18: Nil) and
European operations `63.15 crore (2017-18: Nil). The impairment recognised is included within other expenses in consolidated statement
of profit and loss.
NOTES
forming part of the consolidated financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Carrying value of the Group’s interest in associates* 155.86 301.23
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Group's share in profit/(loss) for the year of associates* 19.40 62.43
Group's share in other comprehensive income for the year of associates 1.63 (0.31)
Group's share in total comprehensive income for the year of associates 21.03 62.12
(ii) Fair value of investments in equity accounted associates for which published price quotation is available, which is a Level 1 input as at
March 31, 2019 is `62.07 crore (March 31, 2018: `102.76 crore). The carrying value of such investments is Nil (March 31, 2018: Nil) as the
Group’s share of losses in such associates exceeds the cost of investments made.
(iii) Share of unrecognised loss in respect of equity accounted associates amounted to `9.41 crore for the year ended March 31, 2019 (2017-18:
`40.85 crore). Cumulative share of unrecognised losses in respect of equity accounted associates as at March 31, 2019 amounted to
`77.95 crore. (March 31, 2018: `68.54 crore)
(iv) The Group did not recognise any impairment in respect of its equity accounted associates during the year (2017-18: Nil).
335
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(ii) The Group has no material joint ventures as at March 31, 2019. The aggregate summarised financial information in respect of the Group’s
immaterial joint ventures accounted for using the equity method is as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
Carrying value of Group’s interest in joint ventures* 1,767.09 1,479.99
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Group's share in profit/(loss) for the year of joint ventures* 205.30 176.69
Group's share in other comprehensive income for the year of joint ventures 2.76 16.27
Group's share in total comprehensive income for the year of joint ventures 208.06 192.96
(iii) Share of unrecognised losses in respect of equity accounted joint ventures amounted to `57.24 crore for the year ended March 31, 2019
(2017-18: `35.78 crore). Cumulative share of unrecognised losses in respect of equity accounted joint ventures as at March 31, 2019
amounted to `1,293.30 crore. (March 31, 2018: `1,187.58 crore).
(iv) During the year ended March 31, 2019, the Group has recognised an impairment of `0.06 crore (2017-18: Nil) in respect of its equity
accounted joint ventures.
(d) Summary of Group’s share in profit/(loss) for the year of equity accounted investees:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 20018
Share of profit/(loss) in immaterial associates 19.40 62.43
Share of profit/(loss) in immaterial joint ventures 205.30 176.69
224.70 239.12
NOTES
forming part of the consolidated financial statements
(e) Summary of Group’s share in other comprehensive income for the year of equity accounted investees:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Share of other comprehensive income of immaterial associates 1.63 (0.31)
Share of other comprehensive income of immaterial joint ventures 2.76 16.27
4.39 15.96
*Group’s share in net assets and profit/(loss) of equity accounted investees has been determined after giving effect for subsequent
amortisation/depreciation and other adjustments arising on account of fair value adjustments made to the identifiable net assets of the equity
accounted investees as at the date of acquisition and other adjustment e.g. unrealised profits on inventories etc., arising under the equity
method of accounting.
8. Investments
[Item No. I(g)(i) and II(b)(i), Page 306]
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Investments carried at amortised cost:
Investment in government or trust securities 0.02 0.02
Investment in bonds and debentures 0.20 0.20
Investment in preference shares 64.99 -
65.21 0.22
(b) Investments carried at fair value through other comprehensive income:
Investment in equity shares# 756.39 876.65
756.39 876.65
(c) Investments carried at fair value through profit and loss:
Investment in bonds and debentures 49.74 141.04
Investment in preference shares 250.00 -
Investment in equity shares 60.75 120.45
Investment in mutual funds 108.27 70.92
468.76 332.41
1,290.36 1,209.28
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
Investments carried at fair value through profit and loss:
Investment in mutual funds 2,524.86 14,908.97
2,524.86 14,908.97
337
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
8. Investments (Contd.)
[Item No. I(g)(i) and II(b)(i), Page 306]
(i) Carrying value and market value of quoted and unquoted investments is as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Investments in quoted instruments:
Aggregate carrying value 454.53 699.46
Aggregate market value 454.53 699.46
(ii) C
umulative gain on de-recognition of investments during the year which were carried at fair value through other comprehensive
income amounted to `31.06 crore (2017-18: `3,427.46 crore). Fair value of such investments as on the date of de-recognition was
`40.78 crore (2017-18: `3,782.76 crore).
# includes unquoted equity instruments for which cost has been considered as an appropriate estimate of fair value because of a wide range
of possible fair value measurements and cost represents the best estimate of fair value within that range.
9. Loans
[Item No. I(g)(ii) and II(b)(v), Page 306]
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Security deposits
Considered good- Unsecured 254.98 197.71
Credit impaired 2.07 2.18
Less: Allowance for credit losses 2.07 2.18
254.98 197.71
(b) Loans to related parties
Considered good- Unsecured 7.37 7.52
Credit impaired 188.67 192.31
Less: Allowance for credit losses 188.67 192.31
7.37 7.52
(c) Other loans
Considered good- Unsecured 350.99 512.11
Credit impaired 1,382.53 1,313.60
Less: Allowance for credit losses 1,382.53 1,313.60
350.99 512.11
613.34 717.34
NOTES
forming part of the consolidated financial statements
9. Loans (Contd.)
[Item No. I(g)(ii) and II(b)(v), Page 306]
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Security deposits
Considered good- Unsecured 91.16 43.69
Credit impaired 151.75 0.23
Less: Allowance for credit losses 151.75 0.23
91.16 43.69
(b) Loans to related parties
Considered good- Unsecured 27.60 46.22
Credit impaired 831.55 783.36
Less: Allowance for credit losses 831.55 783.36
27.60 46.22
(c) Other loans
Considered good- Unsecured 120.94 166.57
Credit impaired 2.08 2.08
Less: Allowance for credit losses 2.08 2.08
120.94 166.57
239.70 256.48
(i) Security deposits are primarily in relation to public utility services and rental agreements. It includes deposit with Tata Sons Private Limited
`1.25 crore (March 31, 2018: `1.25 crore).
(ii) Non-current loans to related parties represent loans given to joint ventures `185.37 crore (March 31, 2018: `188.95 crore) and associates
`10.67 crore (March 31, 2018: `10.88 crore) out of which `185.37 crore (March 31, 2018: `188.95 crore) and `3.30 crore (March 31, 2018:
`3.36 crore) respectively is impaired.
(iii) Current loans/advances to related parties represent loans given to joint ventures `859.15 crore (March 31, 2018: `829.58 crore) out of which
`831.55 crore (March 31, 2018: `783.36 crore) is impaired.
(iv) There are no outstanding debts from directors or other officers of the Company.
339
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Interest accrued on deposits, loans and advances
Considered good- Unsecured 84.41 2.25
Credit impaired 0.27 0.27
Less: Allowance for credit losses 0.27 0.27
84.41 2.25
(d) Others
Considered good- Unsecured 414.66 0.64
Credit impaired 148.34 -
Less: Allowance for credit losses 148.34 -
414.66 0.64
570.06 87.91
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Interest accrued on deposits and loans
Considered good- Unsecured 42.10 43.28
Credit impaired 216.08 149.54
Less: Allowance for credit losses 216.08 149.54
42.10 43.28
(b) Others
Considered good- Unsecured 1,206.46 567.32
Credit impaired 5.17 -
Less: Allowance for credit losses 5.17 -
1,206.46 567.32
1,248.56 610.60
(i) Non-current earmarked balances with banks represent deposits and balances in escrow account not due for realisation within 12 months
from the balance sheet date. These are primarily placed as security with government bodies, margin money against issue of bank
guarantees and deposits made against contract performance.
(ii) Other non-current balances with banks represent bank deposits not due for realisation within 12 months from the balance sheet date.
(iii) Current other financial assets include amount receivable from post-employment benefit funds `769.20 crore (March 31, 2018: `302.14
crore) on account of retirement benefit obligations paid by the Group directly.
NOTES
forming part of the consolidated financial statements
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Retiring gratuities 4.38 2.91
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Pension 7.37 9.23
(b) Retiring gratuities 4.51 3.69
(c) Post-retirement medical benefits 92.66 89.53
(d) Other defined benefits 16.15 7.91
120.69 110.36
(i) Detailed disclosure in respect of post-retirement defined benefit schemes is provided in note 38, page 378.
(ii) Other defined benefits include post-retirement lumpsum benefits, long service awards, packing and transportation, farewell gifts etc.
341
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
Income tax expense at tax rates applicable to individual entities 5,576.07 4,960.95
(a) Tax on income at different rates (24.22) (0.04)
(b) Additional tax benefit for capital investment including research and development expenditures (25.37) (26.79)
(c) Income exempt from tax/items not deductible 646.06 247.61
(d) Deferred tax assets not recognised because realisation is not probable 3,197.18 780.11
(e) Adjustments to taxes in respect of prior periods (287.69) 16.67
(f ) Utilisation/credit of unrecognised tax losses, unabsorbed depreciation and other tax benefits (2,406.93) (2,713.62)
(g) Impact of changes in tax rates(i) 43.33 127.44
Tax expense as reported 6,718.43 3,392.33
(i) Impact of changes in tax rates during the year ended March 31, 2019 represents re-measurement of deferred tax assets following a
reduction in corporate income tax rate within European operations.
During the year ended March 31, 2018, the Company and its Indian subsidiaries re-measured deferred tax balances expected to reverse in
future periods based on changes in statutory tax rate made by the Finance Act, 2018.
NOTES
forming part of the consolidated financial statements
(` crore)
Balance Recognised/ Recognised Recognised Addition Disposal Reclassified Other Exchange Balance
as at (reversed) in in other in equity relating to of group as held for movements differences on as at
April 1, 2018 profit and loss comprehensive during the acquisitions undertakings sale during the consolidation March 31, 2019
during the year income during year during the during the during the year during the
the year year year year year
343
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
Components of deferred tax assets and liabilities as at March 31, 2018 is as below:
(` crore)
Balance Recognised/ Recognised Recognised in Addition relating Other Exchange Balance
as at (reversed) in in other equity during to acquisitions movements differences on as at
during the year
April 1, 2017 profit and loss comprehensive the year during the year consolidation April 1, 2018
during the year Income during during the year
the year
Deferred tax assets:
Tax-loss carry forwards 1,009.20 1,716.86 - - - (21.76) 287.25 2,991.55
Expenses allowable 2,151.80 (177.93) - - - (22.00) 32.35 1,984.22
for tax purposes when
paid/written off
MAT credit entitlement/ 1,513.30 (84.02) 731.38 - - - - 2,160.66
(utilisation)
Others 104.10 164.79 33.58 - - 0.15 19.02 321.64
4,778.40 1,619.70 764.96 - - (43.61) 338.62 7,458.07
Deferred tax liabilities:
Property, plant and 13,248.51 172.12 - (6.21) 36.09 0.23 4.18 13,454.92
equipment and
Intangible assets
Retirement benefit 90.40 2,655.29 (296.47) - - - 218.96 2,668.18
assets/obligations
Others 583.70 194.91 - - - - 90.44 869.05
13,922.61 3,022.32 (296.47) (6.21) 36.09 0.23 313.58 16,992.15
Net deferred tax (9,144.21) (1,402.62) 1,061.43 6.21 (36.09) (43.84) 25.04 (9,534.08)
assets/(liabilities):
Disclosed as:
Deferred tax assets 885.87 1,035.80
Deferred tax liabilities 10,030.08 10,569.88
(9,144.21) (9,534.08)
(ii) Deferred tax assets, have been recognised based on an evaluation of whether it is probable that taxable profits will be earned in
future accounting periods considering all the available evidences, including approved budgets and forecasts by the Board of the
respective entities.
(iii) Deferred tax assets have not been recognised in respect of tax losses of `45,310.97 crore (March 31, 2018: `39,499.52 crore) as its recovery
is not considered probable in the foreseeable future. Such losses primarily relate to the Group’s European operations.
NOTES
forming part of the consolidated financial statements
(iv) Unrecognised tax losses in respect of which deferred tax asset has not been recognised, expire unutilised based on the year of
origination as below:
(` crore)
As at
March 31, 2019
Within five years 3,081.35
Later than five years but less than ten years 7,245.63
Later than ten years but less than twenty years 253.92
No expiry 34,730.07
45,310.97
(v) Unused tax credits and other deductible temporary differences in respect of which deferred tax asset has not been recognised, expire
unutilised based on the year of origination as below:
(` crore)
As at
March 31, 2019
Within five years 2,019.28
No expiry 1,005.88
3,025.16
(vi) At the end of the reporting period, aggregate amount of temporary difference associated with undistributed earnings of subsidiaries for
which deferred tax liability has not been recognised is `6,642.93 crore (March 31, 2018: `6,210.92 crore). No liability has been recognised
in respect of such difference because the Group is in a position to control the timing of reversal of the temporary difference and it is
probable that such difference will not reverse in the foreseeable future.
345
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Capital advances
Considered good - Unsecured 1,068.83 502.36
Considered doubtful - Unsecured 93.05 93.22
Less: Provision for doubtful advances 93.05 93.22
1,068.83 502.36
(b) Advances with public bodies
Considered good - Unsecured 1,473.31 880.48
Considered doubtful - Unsecured 345.42 24.01
Less: Provision for doubtful advances 345.42 24.01
1,473.31 880.48
(e) Others
Considered good - Unsecured 219.18 214.74
Considered doubtful - Unsecured - 10.09
Less: Provision for doubtful advances - 10.09
219.18 214.74
4,654.92 2,577.14
NOTES
forming part of the consolidated financial statements
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Advances with public bodies
Considered good - Unsecured 2,095.99 2,120.06
Considered doubtful - Unsecured 2.71 2.83
Less: Provision for doubtful advances 2.71 2.83
2,095.99 2,120.06
(d) Others
Considered good - Unsecured 1,396.65 881.82
Considered doubtful - Unsecured 46.58 102.87
Less: Provision for doubtful advances 46.58 102.87
1,396.65 881.82
3,529.70 3,098.09
(i) Advances with public bodies primarily relate to input credit entitlements and amounts paid under protest in respect of demands and
claims from regulatory authorities.
(ii) Prepaid lease payments for operating leases relate to land leases classified as operating since land has an indefinite economic life and title
is not expected to transfer at the end of the lease term.
(iii) Others include advances against supply of goods/services and advances paid to employees.
347
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
14. Inventories
[Item No. II(a), Page 306]
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Raw materials 11,424.47 9,551.29
(b) Work-in-progress 4,591.81 5,145.30
(c) Finished and semi-finished goods 11,055.76 9,787.47
(d) Stock-in-trade 96.65 66.94
(e) Stores and spares 4,487.41 3,780.04
31,656.10 28,331.04
Included above, goods-in-transit:
(i) Raw materials 1,942.16 1,939.01
(ii) Finished and semi-finished goods 314.93 123.02
(iii) Stock-in-trade 66.22 31.99
(iv) Stores and spares 190.74 155.60
2,514.05 2,249.62
Value of inventories above is stated after provisions (net of reversal) of `482.25 crore (March 31, 2018: `526.77 crore) for write-down to net
realisable value and provision for slow-moving and obsolete items.
(` crore)
As at As at
March 31, 2019 March 31, 2018
Considered good- Unsecured 11,811.00 12,415.52
Credit impaired 392.92 250.26
12,203.92 12,665.78
Less: Allowance for credit losses 392.92 250.26
11,811.00 12,415.52
In determining allowance for credit losses of trade receivables, the Group has used the practical expedient by computing the expected credit
loss allowance based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward
looking information. The expected credit loss allowance is based on ageing of the receivables that are due and rates used in the provision matrix.
NOTES
forming part of the consolidated financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 250.26 226.86
Charge during the year 33.16 55.67
Utilised during the year (19.94) (24.36)
Addition relating to acquisitions 172.36 -
Disposal of group undertakings (9.75) (28.18)
Classified as held for sale (32.15) -
Exchange differences on consolidation (1.02) 20.27
Balance at the end of the year 392.92 250.26
(ii) Ageing of trade receivables and credit risk arising therefrom is as below:
(` crore)
As at March 31, 2019
Gross Subject to credit Allowance for Net
credit risk insurance cover credit losses credit risk
Amounts not yet due 10,469.72 7,687.00 41.14 2,741.58
One month overdue 715.71 423.61 9.65 282.45
Two months overdue 191.42 59.70 8.39 123.33
Three months overdue 76.60 29.41 4.71 42.48
Between three to six months overdue 157.49 50.18 10.87 96.44
Greater than six months overdue 592.98 78.19 318.16 196.63
12,203.92 8,328.09 392.92 3,482.91
(` crore)
As at March 31, 2018
Gross Subject to credit Allowance for Net
credit risk insurance cover credit losses credit risk
Amounts not yet due 11,124.82 7,102.01 8.12 4,014.69
One month overdue 621.91 298.09 0.78 323.04
Two months overdue 161.60 115.51 3.27 42.82
Three months overdue 219.77 142.03 0.98 76.76
Between three to six months overdue 146.18 72.38 16.05 57.75
Greater than six months overdue 391.50 70.44 221.06 100.00
12,665.78 7,800.46 250.26 4,615.06
(iii) The Group considers its maximum exposure to credit risk with respect to customers as at March 31, 2019 to be `3,482.91 crore (March 31,
2018: `4,615.06 crore), which is the carrying value of trade receivables after allowance for credit losses and considering insurance cover.
The Group’s exposure to customers is diversified and there is no concentration of credit risk with respect to any particular customer.
(iv) There are no outstanding receivables due from directors or officers of the Company.
349
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Cash on hand 1.67 1.50
(b) Cheques, drafts on hand 9.32 30.46
(c) Remittances-in-transit 9.27 53.20
(d) Unrestricted balances with banks 2,955.27 7,698.34
2,975.53 7,783.50
(` crore)
As at As at
March 31, 2019 March 31, 2018
INR 1,328.22 5,132.75
GBP 1,565.50 1,449.48
EURO (131.98) 528.09
USD 30.35 190.76
Others 183.44 482.42
Total 2,975.53 7,783.50
(` crore)
As at As at
March 31, 2019 March 31, 2018
Earmarked balances with banks 365.84 154.35
(i) Currency profile of earmarked balances with banks is as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
INR 350.21 139.65
USD 15.63 14.70
Total 365.84 154.35
NOTES
forming part of the consolidated financial statements
(i) On January 28, 2019, the Group entered into definitive agreements with HBIS Group Co. Ltd. (“HBIS”) to divest its entire equity stake in
NatSteel Holdings Pte. Ltd. (“NSH”) and Tata Steel (Thailand) Public Company Ltd. (“TSTH”). As per the agreement, the divestment will be
made to a company in which 70% equity shares will be held by an entity controlled by HBIS and 30% will be held by the Group.
In accordance with Ind AS 105, “Non-current Assets Held for Sale and Discontinued Operations”, the assets and liabilities of businesses forming
part of the disposal group have been classified as held for sale.
As on March 31, 2018, the Group had classified certain assets within these businesses as held for sale.
The major classes of assets and liabilities classified as held for sale as on reporting date are set out below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
Non-current assets
Property, plant and equipment 1,484.91 95.93
Capital work-in-progress 40.27 -
Other intangible assets 6.17 -
Intangible assets under development 0.54 -
Other investments 38.70 -
Other financial assets 1.50 -
Other non-financial assets 1.83 -
Non-current tax assets 19.29 -
Deferred tax assets 16.43 -
1,609.64 95.93
Current assets
Inventories 1,491.32 -
Trade receivables 608.51 -
Cash and bank balances 294.77 -
Other current financial assets 78.25 -
Derivative assets 2.82 -
Other current non-financial assets 51.26 -
Current tax assets 2.88 -
2,529.81 -
Total assets held for sale 4,139.45 95.93
351
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Non-current liabilities
Borrowings 11.14 -
Other financial liabilities 0.37 -
Provisions 0.23 -
Retirement benefit obligations 61.89 -
Deferred tax liabilities 51.68 -
125.31 -
Current liabilities
Borrowings 670.97 -
Derivative liabilities 3.62 -
Trade payables 501.19 -
Other financial liabilities 90.92 -
Retirement benefit obligations 0.61 -
Provisions 2.76 -
Other non-financial liabilities 17.91 -
Current tax liabilities 12.75 -
1,300.73 -
Total liabilities held for sale 1,426.04 -
(ii) As at March 31, 2019, the Group has classified certain assets and liabilities held within a disposal group with net carrying value of `2.73
crores (March 31, 2018: `6.43 crore) in respect of one of its Indian subsidiary as held for sale. These assets and liabilities continue to be
classified as held for sale as the Group expects to recover the carrying value principally through sale.
(` crore)
As at As at
March 31, 2019 March 31, 2018
Property, plant and equipment 0.06 0.06
Inventories 1.92 5.08
Trade receivables 0.79 1.25
Other non-financial assets 0.04 0.15
Total assets held for sale 2.81 6.54
Trade payables 0.08 0.11
Total liabilities held for sale 0.08 0.11
NOTES
forming part of the consolidated financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Authorised:
1,75,00,00,000 Ordinary Shares of `10 each 1,750.00 1,750.00
(March 31, 2018: 1,75,00,00,000 Ordinary Shares of `10 each)
35,00,00,000 'A' Ordinary Shares of `10 each * 350.00 350.00
(March 31, 2018: 35,00,00,000 'A' Ordinary Shares of `10 each)
2,50,00,000 Cumulative Redeemable Preference Shares of `100 each * 250.00 250.00
(March 31, 2018: 2,50,00,000 Shares of `100 each)
60,00,00,000 Cumulative Convertible Preference Shares of `100 each * 6,000.00 6,000.00
(March 31, 2018: 60,00,00,000 Shares of `100 each)
8,350.00 8,350.00
Issued:
1,12,75,20,570 Ordinary Shares of `10 each
(March 31, 2018: 1,12,75,20,570 Ordinary Shares of `10 each) 1,127.52 1,127.52
7,76,97,280 Ordinary Shares of `10 each (partly paid up, `2.504 each paid up)
(March 31, 2018: 7,76,97,280 Ordinary Shares of `10 each, 77.70 77.70
`2.504 each paid up)
1,205.22 1,205.22
(i) Subscribed and paid up share capital excludes 11,81,893 (March 31, 2018: 11,68,393) Ordinary Shares of face value `10 each fully paid
up held by subsidiaries of the Company.
353
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
As at As at
March 31, 2019 March 31, 2018
No. of shares ` crore No. of shares ` crore
Ordinary Shares of `10 each
Balance at the beginning of the year 1,20,29,51,047 1,144.75 97,00,47,046 970.04
Fully paid shares allotted during the year(a),(b),(c) 4,865 0.00* 15,52,69,376 155.27
Partly paid shares allotted during the year(d) 2,080 0.00* 7,76,34,625 19.44
Adjustment for cross holdings (13,500) (0.01) - -
Balance at the end of the year 1,20,29,44,492 1,144.74 1,20,29,51,047 1,144.75
(` crore)
Utilised till Utilised during the year
Particulars Total
March 31, 2018 ended March 31, 2019
Repayments of loan 5,000.00 1,950.00 6,950.00
Expenses towards general corporate purpose 1,500.00 630.44 2,130.44
Issue expense - 33.85 33.85
Total 6,500.00 2,614.29 9,114.29
(iv) As at March 31, 2019, 2,99,188 Ordinary Shares of face value `10 each (March 31, 2018: 3,00,395 Ordinary Shares) are kept in abeyance in
respect of Rights Issue of 2007.
As at March 31, 2019, 1,21,460 fully paid Ordinary Shares of face value `10 each (March 31, 2018: 1,25,624 fully paid Ordinary Shares) and
60,575 partly paid Ordinary Shares of face value `10 each, `2.504 paid up (March 31, 2018: 62,655 partly paid Ordinary Shares, `2.504 paid
up) are kept in abeyance in respect of Rights Issue of 2018.
NOTES
forming part of the consolidated financial statements
(v) Details of shareholders holding more than 5 percent shares in the Company is as below:
As at As at
March 31, 2019 March 31, 2018
No. of Ordinary No. of Ordinary
% held % held
Shares Shares
Name of shareholders
(a) Tata Sons Private Limited 38,09,73,085 31.64 38,09,73,085 31.64
(b) Life Insurance Corporation of India 10,83,88,660 9.00 10,83,88,660 9.00
355
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
and for repayment of capital in a winding up, pari passu inter holders thereof the right to vote at any meetings of the Company
se and in priority to the Ordinary Shares of the Company, but save to the extent and in the manner provided in the Companies
shall not confer any further or other right to participate either Act, 1956, or any re-enactment thereof.
in profits or assets. However, in case of CCPS, such preferential
(iv) CCPS shall be converted into Ordinary Shares as per the terms,
rights shall automatically cease on conversion of these shares into
determined by the Board at the time of issue; as and when
Ordinary Shares.
converted, such Ordinary Shares shall rank pari passu with the
(iii) The holders of such shares shall have the right to receive all notices then existing Ordinary Shares of the Company in all respects.
of general meetings of the Company but shall not confer on the
The Company had issued hybrid perpetual securities of `775.00 crore and `1,500.00 crore in May 2011 and March 2011 respectively.
These securities are perpetual in nature with no maturity or redemption and are callable only at the option of the Company. The distribution on
these securities are 11.50% p.a. and 11.80% p.a. respectively, with a step up provision if the securities are not called after 10 years. The distribution
on the securities may be deferred at the option of the Company if in the six months preceding the relevant distribution payment date, the
Company has not made payment on, or repurchased or redeemed, any securities ranking pari passu with, or junior to the instrument. As these
securities are perpetual in nature and the Company does not have any redemption obligation, these have been classified as equity.
NOTES
forming part of the consolidated financial statements
A. Retained earnings
(i) Primarily relates to cumulative gain on sale of investments carried at fair value through other comprehensive income transfered from
investment revaluation reserve.
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 9.99 105.99
Other comprehensive income recognised during the year 109.64 (96.00)
Balance at the end of the year 119.63 9.99
357
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(i) The details of other comprehensive income recognised during the year is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Fair value changes recognised during the year 349.67 (579.05)
Fair value changes reclassified to the consolidated statement of profit and loss/cost of hedged items (198.58) 454.47
Tax impact on above (41.45) 28.58
109.64 (96.00)
During the year, ineffective portion of cash flow hedges recognised in the consolidated statement of profit and loss amounted to Nil
(2017-18: Nil).
(ii) The amount recognised in cash flow hedge reserve (net of tax) is expected to impact the consolidated statement of profit and loss as below:
- within the next one year: gain of `120.03 crore (2017-18: gain of `6.24 crore)
- later than one year: loss of `0.40 crore (2017-18: gain of `3.75 crore)
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 155.23 3,788.40
Other comprehensive income recognised during the year (44.30) (204.92)
Tax impact on above (2.65) (0.63)
Transfers within equity (31.06) (3,427.62)
Other movements 3.06 -
Balance at the end of the year 80.28 155.23
NOTES
forming part of the consolidated financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 6,984.28 8,534.47
Other comprehensive income recognised during the year 507.78 (1,550.19)
Other movements (79.82) -
Balance at the end of the year 7,412.24 6,984.28
C.
Other reserves
(a) Securities premium
Securities premium is used to record premium received on issue of shares. The reserve is utilised in accordance with the provisions of the
Companies Act, 2013.
The details of movement in securities premium is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 27,777.40 18,871.66
Received/transfer on issue of Ordinary Shares during the year 0.26 8,939.59
Equity issue expenses written (off )/back during the year 0.43 (33.85)
Balance at the end of the year 27,778.09 27,777.40
359
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
NOTES
forming part of the consolidated financial statements
(g) Others
thers primarily represent amounts appropriated out of the statement of profit and loss for unforeseen contingencies. Such appropriations
O
are free in nature.
The details of movement in others is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 252.57 252.29
Transfers within equity 0.55 0.28
Balance at the end of the year 253.12 252.57
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 0.02 0.01
Application money received during the year 0.24 0.02
Allotment of Ordinary Shares during the year (0.26) (0.01)
Balance at the end of the year - 0.02
361
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Non-controlling interests 2,364.46 936.52
In September 2017, the UK Pensions Regulator (tPR) had approved a Regulated Apportionment Arrangement (RAA) in respect of the British Steel
Pension Scheme (BSPS) which separated the scheme from Tata Steel UK (TSUK), a wholly owned indirect subsidiary of the Company. This was
accompanied by a one-time settlement payment and a transfer of a 33% minority stake in TSUK to the BSPS trustees. During the year ended
March 31, 2019 the non-controlling interest was diluted from 33% to 0.33% due to an equity issuance made by TSUK.
The Company, through its wholly owned subsidiary, T S Global Minerals Holdings Pte. Ltd via TSMUK holds 77.68 % equity stake in Tata Steel
Minerals Canada Limited.
On May 18, 2018, Bamnipal Steel Limited, a wholly owned subsidiary of the Company, completed the acquisition of 72.65% stake in Tata Steel
BSL Limited (formerly “Bhushan Steel Limited”) pursuant to a Corporate Insolvency Resolution Process implemented under the Insolvency and
Bankruptcy Code 2016.
The table below provides information in respect of these subsidiaries which include material non-controlling interests as at March 31, 2019:
(` crore)
Name of subsidiary Country of % of non- % of non- Profit/(loss) Profit/(loss) Non-controlling Non-controlling
incorporation and controlling controlling attributable to attributable to interests as at interests as at
operation interests as at interests as at non-controlling non-controlling March 31, 2019 March 31, 2018
March 31, 2019 March 31, 2018 interests for interests for
the year ended the year ended
March 31, 2019 March 31, 2018
Tata Steel UK Limited United Kingdom 0.33% 33.33% (1,091.61) 4,389.78 (14.35) (623.46)
Tata Steel Minerals Canada 22.32% 22.32% (10.91) (225.13) 624.98 599.30
Canada Limited
Tata Steel BSL Limited India 27.35% - (240.93) - 286.43 -
The tables below provide summarised information in respect of consolidated balance sheet as at March 31, 2019, consolidated statement of
profit and loss and consolidated statement of cash flows for the year ended March 31, 2019, in respect of the above mentioned entities:
Summarised balance sheet information
(` crore)
Tata Steel UK Limited Tata Steel Minerals Canada Limited Tata Steel BSL Limited
Particulars As at As at As at As at As at As at
March 31, 2019 March 31, 2018 March 31, 2019 March 31, 2018 March 31, 2019 March 31, 2018
Non-current assets 32,122.20 31,672.43 6,943.13 6,034.10 31,628.26 -
Current assets 7,019.72 7,208.45 82.43 130.95 7,981.01 -
Total assets (A) 39,141.92 38,880.88 7,025.56 6,165.05 39,609.27 -
Non-current liabilities 19,412.41 18,458.11 3,514.19 2,869.43 17,089.27 -
Current liabilities 24,049.55 22,293.33 711.27 610.57 4,178.26 -
Total liabilities (B) 43,461.96 40,751.44 4,225.46 3,480.00 21,267.53 -
Net assets (A-B)(i) (4,320.04) (1,870.56) 2,800.10 2,685.05 18,341.74 -
(i) Net assets of Tata Steel BSL Limited as at March 31, 2019, includes equity portion of preference shares of `17,295.82 issued by Tata Steel BSL
Limited to the Company.
NOTES
forming part of the consolidated financial statements
23. Borrowings
[Item No. V(a)(i) and VI(a)(i), Page 307]
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Secured
(i) Loan from Joint Plant Committee - Steel Development Fund 2,564.10 2,494.42
(ii) Term loans from banks/financial institutions 23,458.91 17,825.17
(iii) Finance lease obligations 1,324.76 471.29
27,347.77 20,790.88
363
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
(b) Unsecured
(i) Bonds and debentures 29,509.49 29,456.43
(ii) Non-convertible preference shares 13.31 19.97
(iii) Term loans from banks/financial institutions 21,047.72 19,942.61
(iv) Finance lease obligations 2,134.08 2,397.51
(v) Deferred payment liabilities 6.40 6.11
(vi) Other loans 283.96 175.59
52,994.96 51,998.22
80,342.73 72,789.10
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Secured
(i) Loans from banks/financial institutions 5,437.52 5,541.48
(ii) Repayable on demand from banks/financial institutions 45.88 139.62
(iii) Other Loans - 37.69
5,483.40 5,718.79
(b) Unsecured
(i) Preference shares 1.00 -
(ii) Loans from banks/financial institutions 5,129.65 9,893.26
(iii) Commercial papers 171.97 73.65
(iv) Other loans 16.06 199.28
5,318.68 10,166.19
10,802.08 15,884.98
(i) As at March 31, 2019, `35,931.48 crore (March 31, 2018: `26,819.90 crore) of the total outstanding borrowings (including current
maturities) were secured by a charge on property, plant and equipment, inventories and receivables.
(ii) The security details of major borrowings as at March 31, 2019 is as below:
NOTES
forming part of the consolidated financial statements
The loan is repayable in 16 equal semi-annual instalments after completion of four years from the date of the tranche.
The Company has filed a writ petition before the High Court at Kolkata in February 2006 claiming waiver of the outstanding loan and
interest and refund of the balance lying with Steel Development Fund and the matter is subjudice.
The loan includes funded interest `924.77 crore (March 31, 2018: `855.09 crore).
It includes `1,639.33 crore (March 31, 2018: `1,639.33 crore) representing repayments and interest on earlier loans for which applications
of funding are awaiting sanction and is not secured by charge on movable assets of the Company.
365
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(II) Bonds
ABJA Investment Co. Pte. Ltd. a wholly owned subsidiary of the Company has issued non-convertible bonds that are listed on the Singapore
Stock Exchange and Frankfurt Stock Exchange. Details of the bonds outstanding at the end of the reporting period is as below:
Sl. No. Issued on Currency Initial principal due Outstanding principal (in millions) Interest rate Redeemable on
(in millions)
As at As at
March 31, 2019 March 31, 2018
1 January 2018 USD 1,000 1,000 1,000 5.45% January 2028
2 July 2014 USD 1,000 1,000 1,000 5.95% July 2024
3 January 2018 USD 300 300 300 4.45% July 2023
4 May 2013 SGD 300 300 300 4.95% May 2023
5 July 2014 USD 500 500 500 4.85% January 2020
NOTES
forming part of the consolidated financial statements
(II) Details of loans from banks/financial institutions availed by NatSteel Asia Pte Limited a subsidiary of the Company is as below:
(i) USD 1,151.16 million equivalent to `7,963.16 crore (March 31, 2018: Nil) loan is repayable in 3 annual instalments, the next instalment
is due on April 19, 2022.
(ii) EUR 418.27 million equivalent to `3,248.41 crore (March 31, 2018: Nil) loan is repayable in 3 annual instalments, the next instalment
is due on April 19, 2022
367
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Interest accrued but not due 9.57 18.17
(b) Creditors for other liabilities 261.01 87.66
270.58 105.83
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Current maturities of long-term borrowings 9,276.95 3,220.66
(b) Current maturities of finance lease obligations 394.46 252.31
(c) Interest accrued but not due 848.96 817.35
(d) Unclaimed dividends 99.11 68.81
(e) Creditors for other liabilities 6,118.35 5,432.65
16,737.83 9,791.78
NOTES
forming part of the consolidated financial statements
25. Provisions
[Item No. V(b) and VI(b), Page 307]
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Employee benefits 2,396.20 2,479.01
(b) Insurance provisions 661.77 858.44
(c) Others 988.24 1,000.79
4,046.21 4,338.24
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Employee benefits 395.97 442.33
(b) Others 852.75 827.31
1,248.72 1,269.64
(i) Non-current and current provision for employee benefits include provision for leave salaries `1,127.69 crore (March 31, 2018: `1,082.50
crore) and provision for early separation and disability `1,591.55 crore (March 31, 2018: `1,763.11 crore).
(ii) As per the leave policy of the Company and its Indian subsidiaries, an employee is entitled to be paid the accumulated leave balance on
separation. The Company and its Indian subsidiaries present provision for leave salaries as current and non-current based on actuarial
valuation considering estimates of availment of leave, separation of employee, etc.
(iii) Insurance provisions relate to Crucible Insurance Company which underwrites marine cargo, public liability and retrospective hearing
impairment policies of Tata Steel Europe, a wholly owned indirect subsidiary of the Company. These provisions represent losses incurred
but not yet reported in respect of risks retained by the Group rather then passed to third party insurers and include amounts in relation to
certain disease insurance claims. Such provisions are subject to regular review and are adjusted as appropriate. The value of final insurance
settlements is uncertain and so is the timing of the expenditure.
(iv) Non-current and current other provisions primarily include:
(a) provision for compensatory afforestation, mine closure and rehabilitation obligations and other environmental remediation obligations
`1,046.50 crore (March 31, 2018: `906.92 crore). These amounts become payable upon closure of the mines/sites and are expected
to be incurred over a period of 1 to 33 years.
(b) provision in respect of onerous leases amounting to `249.65 crore (March 31, 2018: `273.80 crore). The outstanding term of these
leases ranges between 1 to 14 years.
369
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(i) Includes provisions capitalised during the year in respect of restoration obligations.
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Grants relating to property, plant and equipment 804.37 1,452.30
(b) Revenue grants 32.14 10.61
(c) Others 70.29 63.67
906.80 1,526.58
NOTES
forming part of the consolidated financial statements
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Grants relating to property, plant and equipment 10.48 0.83
(b) Others 6.03 5.38
16.51 6.21
Grants relating to property, plant and equipment relates to duty saved on import of capital goods and spares under the EPCG scheme.
Under the scheme, certain entities within the Group are committed to export prescribed times of the duty saved on import of capital goods
over a specified period of time. In case such commitments are not met, the entities would be required to pay the duty saved along with interest
to the regulatory authorities. Such grants recognised are released to the consolidated statement of profit and loss based on fulfilment of
related export obligations.
During the year, an amount of `635.76 crore (2017-18: `528.20 crore) was released from deferred income to the consolidated statement of
profit and loss on fulfilment of export obligations.
A. Non-current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Statutory dues 19.77 35.47
(b) Other credit balances 499.46 322.69
519.23 358.16
B. Current
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Advances received from customers 769.60 583.70
(b) Employee recoveries and employer contributions 161.08 100.35
(c) Statutory dues 6,931.75 6,215.59
(d) Other credit balances 49.78 32.62
7,912.21 6,932.26
(i) Statutory dues primarily relate to payables in respect of GST, excise duties, service tax, sales tax, VAT, tax deducted at source and royalties.
371
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
B. Total outstanding dues of creditors other than micro and small enterprises
(` crore)
As at As at
March 31, 2019 March 31, 2018
(a) Creditors for supplies and services 17,100.42 15,968.40
(b) Creditors for accrued wages and salaries 4,446.80 4,413.20
21,547.22 20,381.60
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Sale of products 1,52,843.66 1,21,008.92
(b) Sale of power and water 1,727.58 1,698.35
(c) Income from services 120.60 23.47
(d) Other operating revenues(ii) 2,977.15 1,378.95
1,57,668.99 1,24,109.69
(i) Revenue from contracts with customers disaggregated on the basis of geographical regions and major businesses is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) India 79,605.15 55,647.26
(b) Outside India 75,086.69 67,083.48
1,54,691.84 1,22,730.74
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Steel 142,483.73 112,666.22
(b) Power and water 1,727.58 1,698.35
(c) Others 10,480.53 8,366.17
1,54,691.84 1,22,730.74
Revenue outside India includes Asia excluding India `8,895.30 crore (2017-18: `6,844.47 crore), UK `14,767.65 crore (2017-18: `13,583.51
crore) and other European countries `41,123.35 crore (2017-18: `38,904.30 crore).
(ii) Other operating revenues include export incentives and deferred income released to consolidated statement of profit and loss on
fulfilment of export obligations under the EPCG scheme.
NOTES
forming part of the consolidated financial statements
(i) Dividend income includes income from investments carried at fair value through other comprehensive income of `19.58 crore
(2017-18: `18.59 crore).
(ii) Interest income includes:
(a) income from financial assets carried at amortised cost of `315.24 crore (2017-18: `239.41crore).
(b) income from financial assets carried at fair value through profit and loss `1.40 crore (2017-18: `10.35 crore).
During the year ended March 31, 2019, the Company has recognised an amount of `27.06 crore (2017-18: `19.04 crore) as remuneration to key
managerial personnel. The details of such remuneration is as below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Short-term employee benefits 22.05 19.03
(b) Post-employment benefits 4.88 (0.02)
(c) Other long-term employee benefits 0.13 0.03
27.06 19.04
373
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Interest expense on:
(a) Bonds, debentures, bank borrowings and others 7,537.44 5,166.49
(b) Finance leases 328.67 403.58
7,866.11 5,570.07
Less: Interest capitalised 206.01 115.33
7,660.10 5,454.74
NOTES
forming part of the consolidated financial statements
On January 28, 2019, the Group entered into definitive agreements with HBIS Group Co. Ltd. (“HBIS”) to divest its entire equity stake in Nat
Steel Holdings Pte. Ltd. (“NSH”) and Tata Steel (Thailand) Public Company Ltd. (“TSTH”). As per the agreement, the divestment will be made
to a company in which 70% equity shares will be held by an entity controlled by HBIS and 30% will be held by the Group.
In accordance with Ind AS 105, “Non-current Assets Held for Sale and Discontinued Operations”, the businesses have been classified as
discontinued operations for the year ended March 31, 2019. Results for the year ended March 31, 2018 has been restated accordingly.
On February 9, 2017, Tata Steel UK Limited, an indirect subsidiary of the Company announced a definitive sales agreement to dispose off
the trade and other assets of its Speciality Steels business. The disposal was completed on May 1, 2017. The results of this business was
classified as discontinued operations till the date of sale during the year ended March 31, 2018.
375
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
The results of discontinued operations in each of the periods is set out below:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
I Revenue from operations 9,632.74 9,065.83
II Other income 2.67 (13.45)
III Total income 9,635.41 9,052.38
IV Expenses:
(a) Cost of materials consumed 396.07 529.05
(b) Purchases of stock-in-trade 5,935.93 5,628.22
(c) Changes in inventories of finished and semi-finished goods, stock-in-trade and 329.57 (164.65)
work-in-progress
(d) Employee benefits expense 597.11 687.50
(e) Finance costs 81.78 47.17
(f ) Depreciation and amortisation expense 237.49 219.96
(g) Other expenses 2,138.34 1,874.95
Total expenses 9,716.29 8,822.20
V Share of profit/(loss) of joint ventures and associates (2.43) (23.21)
VI Profit/(loss) before exceptional items and tax (III-IV+V) (83.31) 206.97
VII Exceptional items (15.29) -
VIII Profit/(loss) before tax (VI+VII) (98.60) 206.97
IX Tax expense:
(a) Current tax 12.19 22.54
(b) Deferred tax (21.83) (9.47)
Total tax expense (9.64) 13.07
X Profit/(loss) after tax (88.96) 193.90
XI Profit/(loss) on disposal of discontinued operations - 5.15
XII Profit/(loss) after tax from discontinued operations (X+XI) (88.96) 199.05
XIII Other comprehensive income/(loss)
(A) (i) Items that will not be reclassified subsequently to profit and loss:
(a) Remeasurement gain/(loss) on post-employment defined benefit plans (0.22) 1.81
(b) Fair value changes of investments in equity shares 10.94 13.90
(ii) Income tax on items that will not be reclassified subsequently to profit and loss (2.03) (0.93)
(B) (i) Items that will be reclassified subsequently to profit and loss:
(a) Foreign currency translation differences 22.48 28.57
(b) Fair value changes of cash flow hedges 2.72 1.15
(c) Share of equity accounted investees - 0.47
(ii) Income tax on items that will be reclassified subsequently to profit and loss - -
Total other comprehensive income/(loss) 33.89 44.97
XIV Total comprehensive income/(loss) from discontinued operations (XII + XIII) (55.07) 244.02
Profit/(loss) from discontinued operations for the year ended March 31, 2018, includes reversal of provision amounting to `49.28 crore held in
respect of Long Products business in the UK classified as held for sale in the earlier years.
During the year ended March 31, 2019, discontinued operations resulted in an inflow of `550.43 crore (March 31, 2018: inflow of `244.96 crore)
to the Group’s net operating cash flows, an outflow of `76.78 crore (March 31, 2018: outflow of `56.68 crore) in respect of investing activities
and an outflow of `422.45 crore (March 31, 2018: outflow of `388.37 crore) in respect of financing activities.
NOTES
forming part of the consolidated financial statements
The following table reflects the profit and shares data used in the computation of basic and diluted earnings per share (EPS).
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
(a) Profit/(loss) after tax from continuing operations 10,283.45 13,255.26
Less: Distribution on hybrid perpetual securities (net of tax) 173.13 173.43
Profit/(loss) after tax from continuing operations attributable to ordinary shareholders- for basic 10,110.32 13,081.83
and diluted EPS (A)
Profit/(loss) after tax from discontinued operations attributable to ordinary shareholders- for (65.12) 179.07
basic and diluted EPS (B)
Profit/(loss) after tax from continuing and discontinued operations attributable to ordinary 10,045.20 13,260.90
shareholders - for basic and diluted EPS (A+B)
Nos. Nos.
(b) Weighted average number of Ordinary Shares for basic EPS 1,14,47,45,815 1,03,50,31,235
Add: Adjustment for shares held in abeyance 1,37,496 1,55,646
Weighted average number of Ordinary Shares and potential Ordinary Shares for diluted EPS 1,14,48,83,311 1,03,51,86,881
(d) Basic earnings per Ordinary Share (`) - continuing operations 88.32 126.39
Diluted earnings per Ordinary Share (`) - continuing operations 88.31 126.37
Basic earnings per Ordinary Share (`) - discontinued operations (0.57) 1.73
Diluted earnings per Ordinary Share (`) - discontinued operations (0.57) 1.73
Basic earnings per Ordinary Share (`) - continuing and discontinued operations 87.75 128.12
Diluted earnings per Ordinary Share (`) - continuing and discontinued operations 87.74 128.10
(i) Basic and diluted earnings per share for continuing and discontinued operations for the year ended March 31, 2018 has been restated to
give effect of businesses classified as discontinued operations.
(ii) As at March 31, 2019, 5,81,95,359 options (March 31,2018: 28,69,886) in respect of partly paid shares were excluded from weighted
average number of Ordinary Shares for the computation of diluted earnings per share as these were anti-dilutive.
377
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
The Company and some of its Indian subsidiaries have Discount rate 7.50% 7.50%
a superannuation plan for the benefit of its employees. Guaranteed rate of return 8.60% - 8.65% 8.55%
Employees who are members of the superannuation plan Expected rate of 8.60% - 8.75% 8.55% - 8.75%
return on investment
are entitled to benefits depending on the years of service
and salary drawn.
(b) Retiring gratuity
Separate irrevocable trusts are generally maintained for The Company and its Indian subsidiaries have an obligation
employees covered and entitled to benefits. The Company towards gratuity, a defined benefit retirement plan covering
and its Indian subsidiaries contribute up to 15% of the eligible eligible employees. The plan provides for a lump-sum payment
employees’ salary or `1,50,000, whichever is lower, to the trust to vested employees at retirement, death while in employment
every year. Such contributions are recognised as an expense as or on termination of employment of an amount equivalent
and when incurred. The Company and its Indian subsidiaries to 15 to 30 days salary payable for each completed year
does not have any further obligations beyond this contribution. of service. Vesting occurs upon completion of five years of
The contributions recognised as an expense in the consolidated service. The Company and its Indian subsidiaries make annual
statement of profit and loss during the year on account of the contributions to gratuity funds established as trusts or insurance
above defined contribution plans amounted to `1,369.81 crore companies. The Company and its Indian subsidiaries accounts
(2017-18: `1,185.05 crore). for the liability for gratuity benefits payable in the future based
on an year-end actuarial valuation.
NOTES
forming part of the consolidated financial statements
38. Employee benefits (Contd.) In line with the conditions agreed as part of a Regulated
Apportionment Arrangement (‘RAA’) on September 11, 2017,
(c) Post-retirement medical benefits assets and liabilities in respect of approximately 80,000 electing
Under this unfunded scheme, employees of the Company and members of the BSPS were transferred from the old scheme
some of its subsidiaries receive medical benefits subject to on March 28, 2018 ahead of that scheme entering a Pension
certain limits on amounts of benefits, periods after retirement Protection Fund (‘PPF’) assessment period the following day.
and types of benefits, depending on their grade and location at The new scheme (which retains the title ‘British Steel Pension
the time of retirement. Employees separated from the Company Scheme’) is sponsored by Tata Steel UK Limited (‘TSUK’).
and its subsidiaries under an early separation scheme, on Although TSUK has a legal obligation to fund any future deficit,
medical grounds or due to permanent disablement are also a key condition of the new BSPS going forward was that it was
covered under the scheme. The Company and such subsidiaries sufficiently well funded to meet the scheme’s modified liabilities
account for the liability for post-retirement medical scheme on a self-sufficiency basis with a buffer to cover residual risks.
based on an year-end actuarial valuation. With the assets that were transferred, the new scheme is well
positioned to pay benefits securely on a low risk basis without
(d) Tata Steel Europe’s pension plan recourse to TSUK. This risk includes economic risks (such as
Tata Steel Europe, a wholly owned indirect subsidiary of the interest rate risk and inflation risk), demographic risks (for
Company, operates a number of defined benefit pension example members living longer than expected), and legal risks
and post-retirement schemes. The benefits offered by these (for example changes in legislation that may increase liabilities).
schemes are largely based on pensionable pay and years of TSUK has worked with the Trustee to develop and implement
service at retirement. With the exception of certain unfunded an Integrated Risk Management (‘IRM’) framework to manage
arrangements, the assets of these schemes are held in these risks. The framework provides ongoing monitoring of the
administered funds that are legally separated from Tata Steel key investment, funding and covenant risks facing the scheme
Europe. For those pension schemes set up under a trust, the and tracks progress against the scheme’s journey plan and
trustees are required by law to act in the best interests of the target. Measures taken by the Trustee to manage risk include the
schemes beneficiaries in accordance with the scheme rules use of asset-liability matching techniques to reduce interest rate
and relevant pension legislation. The trustees are generally risk, and investment in assets that are expected to be correlated
responsible for the investment policy with regard to the assets to future inflation in the longer term to mitigate inflation risk.
of the fund, after consulting with the sponsoring employer. In particular, the scheme’s investment policy has regard for
the maturity and nature of the scheme’s liabilities and seeks to
Tata Steel Europe accounts for all pension and post-retirement
match a large part of the scheme’s liabilities with secure bonds,
defined benefit arrangements using Ind AS 19 ‘Employee
whilst achieving a higher long-term return on a small proportion
Benefits’, with independent actuaries being used to calculate the
of equity and other investments. The BSPS and Open Trustee
costs, assets and liabilities to be recognised in relation to these
Limited (‘OTL’), acting on behalf of the members who transferred
schemes. The present value of the defined benefit obligation,
to the PPF, hold an anti-embarrassment non-controlling interest
the current service cost and past service costs are calculated
in TSUK agreed as part of the RAA. The total non-controlling
by these actuaries using the projected unit credit method.
interest in TSUK reduced from 33.33% as at March 31, 2018 (split
However, the ongoing funding arrangements of each scheme, in
BSPS 27.70%; OTL 5.63%) to 0.33% as at March 31, 2019 (split
place to meet their long-term pension liabilities, are governed by
BSPS 0.27%; OTL 0.06%) due to an equity issuance made by
the individual scheme documentation and national legislation.
TSUK on March 20, 2019 to strengthen TSUK’s financial position.
The principal defined benefit pension scheme of Tata Steel No value has been included in the BSPS’s assets at March 31,
Europe as at March 31, 2019 is the BSPS, which is the main 2019 (2018: nil) for its interest in TSUK as the estimated equity
scheme for historic and present employees based in the UK. value of TSUK is zero (March 31,2018: zero).
379
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
38. Employee benefits (Contd.) (ii) Interest risk: A decrease in the bond interest rate will
increase the plan liability. However, this will be partially
(e) Other defined benefits offset by an increase in the value of plan’s debt investments.
Other benefits provided under unfunded schemes include (iii) Salary risk: The present value of the defined benefit plan
pension payable to directors on their retirement, farewell liability is calculated by reference to the future salaries of
gifts, post-retirement lumpsum benefit and reimbursement of plan participants. As such, an increase in salary of the plan
packing and transportation charges to the employees based on participants will increase the plan’s liability.
their last drawn salary.
(iv) Longevity risk: The present value of the defined benefit
The defined benefit plans expose the Group to a number of plan liability is calculated by reference to the best estimate
actuarial risks as below: of the mortality of plan participants both during and after
(i) Investment risk: The present value of the defined benefit their employment. An increase in the life expectancy of the
plan liability is calculated using a discount rate determined plan participants will increase the plan’s liability.
by reference to government/high quality bond yields. (v) Inflation risk: Some of the Group’s Pension obligations
If the return on plan asset is below this rate, it will create are linked to inflation, and higher inflation will lead to
a plan deficit. higher liabilities although, in most cases, caps on the level
of inflationary increases are in place to protect the plan
against extreme inflation.
NOTES
forming part of the consolidated financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Change in defined benefit obligations:
Obligation at the beginning of the year 2,966.47 2,981.18
Addition relating to acquisitions 56.67 0.31
Current service cost 143.63 144.26
Interest cost 205.38 198.80
Benefits paid (257.31) (282.60)
Remeasurement (gain)/loss (17.85) (163.03)
Adjustment for arrear wage settlement - 87.55
Obligation at the end of the year 3,096.99 2,966.47
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Change in plan assets:
Fair value of plan assets at the beginning of the year 2,898.34 2,745.34
Addition relating to acquisitions 22.55 0.27
Interest income 211.58 190.40
Remeasurement gain/(loss) excluding amount included within employee benefits expense 29.73 8.21
Employers' contribution 72.05 236.72
Benefits paid (257.31) (282.60)
Fair value of plan assets at the end of the year 2,976.94 2,898.34
(` crore)
As at As at
March 31, 2019 March 31, 2018
Fair value of plan assets 2,976.94 2,898.34
Present value of obligations 3,096.99 2,966.47
(120.05) (68.13)
Recognised as:
Retirement benefit assets - Non-current 0.44 0.35
Retirement benefit assets - Current 4.38 2.91
Retirement benefit obligations - Non-current (120.36) (67.70)
Retirement benefit obligations - Current (4.51) (3.69)
(120.05) (68.13)
381
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
Expense/(gain) recognised in the consolidated statement of profit and loss consist of:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Employee benefits expense:
Current service cost 143.63 144.26
Net interest expense (6.20) 8.40
137.43 152.66
(%)
As at As at
March 31, 2019 March 31, 2018
Asset category (%)
Quoted
Equity instruments 0.05 0.01
Debt instruments 18.43 20.89
18.48 20.90
Unquoted
Debt instruments 0.96 1.02
Insurance products 77.12 68.69
Others 3.44 9.39
81.52 79.10
100.00 100.00
The Group’s investment policy is driven by considerations of maximising returns while ensuring credit quality of debt instruments. The asset
allocation for plan assets is determined based on prescribed investment criteria and is also subject to other exposure limitations. The Group
evaluates the risks, transaction costs and liquidity for potential investments. To measure plan assets performance, the Group compares actual
returns for each asset category with published benchmarks.
NOTES
forming part of the consolidated financial statements
(iv) Weighted average duration of the retiring gratuity obligation ranges between 6 to 16 years (March 31, 2018: 6 to 23 years).
(v) The Group expects to contribute `86.49 crore to the plan during the financial year 2019-20.
(vi) The table below outlines the effect on retiring gratuity obligation in the event of a decrease/increase of 1% in the assumptions used.
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Change in defined benefit obligations:
Obligation at the beginning of the year 84,834.48 121,946.21
Current service cost 183.24 128.76
Costs relating to scheme change 18.32 180.26
Interest cost 2,125.59 3,021.56
Past service cost - (15,708.68)
Remeasurement (gain)/loss 3,085.94 1.76
Employers' contribution - (8.58)
Settlements - (14,240.82)
Benefits paid (10,673.74) (23,588.78)
Obligations of companies disposed off (127.66) -
Exchange differences on consolidation (1,472.32) 13,102.79
Obligation at the end of the year 77,973.85 84,834.48
383
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
Expense/(gain) recognised in the consolidated statement of profit and loss consist of:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Employee benefits expense:
Current service cost 183.24 128.76
Past service costs - (17.17)
Net interest expense/(income) (503.91) (77.26)
Costs relating to scheme changes 18.32 -
Exceptional items:
Past service costs - (15,691.51)
Settlements - 1,356.27
Costs relating to scheme changes - 180.26
(302.35) (14,120.65)
Other comprehensive income:
Return on plan assets excluding amount included in employee benefits expense (2,382.12) 1,733.96
Actuarial (gain)/loss arising from changes in demographic assumptions (1,179.06) -
Actuarial (gain)/loss arising from changes in financial assumptions 3,818.84 (4,068.81)
Actuarial (gain)/loss arising from changes in experience adjustments 446.16 4,070.57
703.82 1,735.72
Expense/(gain) recognised in the consolidated statement of profit and loss 401.47 (12,384.93)
NOTES
forming part of the consolidated financial statements
(%)
As at As at
March 31, 2019 March 31, 2018
Assets category (%)
Quoted
(a) Equity - UK Entities 0.59 0.69
(b) Equity - Non-UK Entities 7.41 7.64
(c) Bonds - Fixed rate 49.86 45.55
(d) Bonds - Indexed linked 28.05 31.74
(e) Others 0.04 0.21
85.95 85.83
Unquoted
(a) Property 12.75 11.46
(b) Others 1.30 2.71
14.05 14.17
100.00 100.00
As at As at
March 31, 2019 March 31, 2018
Discount rate 0.80 - 3.95% 1.37 - 4.10%
Rate of escalation in salary 0.00 - 2.00% 0.00 - 2.00%
Inflation rate 1.00 - 3.20% 1.00 - 3.10%
Demographic assumptions are set having regard to the latest trends in life expectancy, plan experience and other relevant data, including
externally published actuarial information within each national jurisdiction. The assumptions are reviewed and updated as necessary as part
of the periodic actuarial funding valuations of the individual pension and post-retirement plans. For the BSPS, the liability calculations as at
March 31, 2019 use the Self-Administered Pension Schemes 2 (SAPS 2) base tables, S2NMA/S2DFA with the 2015 CMI projections with a 1.50%
p.a. (2017-18: 1.50% p.a.) long-term trend applied from 2007 to 2016 [(adjusted by a multiplier of 1.15 p.a. (2017-18: 1.15 p.a.) for males and
1.21 p.a. (2017-18: 1.21 p.a.) for females)]. In addition, future mortality improvements are allowed for in line with the 2018 CMI Projections with
a long-term improvement trend of 1% per annum, a smoothing parameter of 7.0 and an initial addition parameter of 0%. This indicates that
today's 65 year old male member is expected to live on average to approximately 86 years (2017-18: 86.2 years) of age and a male member
reaching age 65 in 15 years time is then expected to live on average to 86 years (2017-18: 87) of age.
(iv) Weighted average duration of the pension obligations is 14.5 years (March 31, 2018: 14.5 years).
(v) The Group expects to contribute Nil to the plan during the financial year 2019-20.
(vi) The table below outlines the effect on pension obligations in the event of a decrease/increase of 10 bps in the assumptions used.
385
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
The above sensitivities may not be representative of the actual change as it is unlikely that the change in assumptions would occur in isolation
of one another as some of the assumptions may be correlated.
(c) Post-retirement medical and other defined benefit plans
(i) The following table sets out the amounts recognised in the consolidated financial statements in respect of post-retirement medical and
other defined benefit plans.
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Medical Others Medical Others
Change in defined benefit obligations:
Obligations at the beginning of the year 1,239.92 158.62 1,256.63 181.29
Current service cost 19.12 115.53 22.01 13.04
Past service cost - - - (24.61)
Interest costs 90.26 8.96 85.62 10.40
Remeasurement (gain)/loss:
(i) Actuarial (gain)/loss arising from changes in demographic assumptions - 1.26 (20.53) (1.46)
(ii) Actuarial (gain)/loss arising from changes in financial assumptions (0.02) (0.20) (55.95) (6.77)
(iii) Actuarial (gain)/loss arising from changes in experience adjustments 24.99 1.33 15.59 (6.18)
Benefits paid (66.78) (13.40) (63.45) (12.35)
Classified as held for sale - (62.11) - -
Exchange differences on consolidation - 1.22 - 5.26
Obligations at the end of the year 1,307.49 211.21 1,239.92 158.62
NOTES
forming part of the consolidated financial statements
Expense/(gain) recognised in the consolidated statement of profit and loss consist of:
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Medical Others Medical Others
Employee benefits expense:
Current service costs 19.12 115.53 22.01 13.04
Past service costs - - - (24.61)
Interest costs 90.26 8.96 85.62 10.40
109.38 124.49 107.63 (1.17)
(ii) Key assumptions used in the measurement of post-retirement medical and other defined benefits is as below:
(iii) Weighted average duration of post-retirement medical benefit obligations ranges between 7 to 9 years (March 31, 2018: 7 to 10 years).
Weighted average duration of other defined benefit obligations ranges between 6 to 12 years (March 31, 2018: 6 to 33 years).
387
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(iv) The table below outlines the effect on post-retirement medical benefit obligations in the event of a decrease/increase of 1% in the
assumptions used:
(v) The table below outlines the effect on other defined benefit obligations in the event of a decrease/increase of 1% in the assumptions used:
The above sensitivities may not be representative of the actual change as it is unlikely that the change in assumptions would occur in isolation
of one another as some of the assumptions may be correlated.
NOTES
forming part of the consolidated financial statements
39. Contingencies and commitments (b) Interest expenditure on “Hybrid perpetual securities” issued
by the Company has been disallowed in assessments with
A. Contingencies
tax demand raised for `459.13 crore (inclusive of interest)
In the ordinary course of business, the Group faces claims and (March 31, 2018: Nil)
assertions by various parties. The Group assesses such claims and
assertions and monitors the legal environment on an on-going basis, In respect of the above demands, the Company has deposited an
with the assistance of external legal counsel, wherever necessary. amount of `1,065.00 crore (March 31, 2018: `665.00 crore) as a
The Group records a liability for any claims where a potential loss is precondition for obtaining stay. The Company expects to sustain its
probable and capable of being estimated and discloses such matters position on ultimate resolution of the said appeals.
in its consolidated financial statements, if material. For potential
Customs, Excise duty and Service tax
losses that are considered possible, but not probable, the Group
provides disclosure in the consolidated financial statements but does s at March 31, 2019, there were pending litigation for various
A
not record a liability in its accounts unless the loss becomes probable. matters relating to customs, excise duty and service tax involving
demands of `911.67 crore (March 31, 2018: `1,021.16 crore), which
The following is a description of claims and assertions where a includes `5.91 crore (March 31, 2018: `44.96 crore) in respect of
potential loss is possible, but not probable. The Group believes that equity accounted investees.
none of the contingencies described below would have a material
adverse effect on the Group’s financial condition, results of operations Sales tax/VAT
or cash flows. The total sales tax demands that are being contested by the Group
It is not practicable for the Group to estimate the timings of the cash amounted to `903.92 crore (March 31, 2018: `667.40 crore), which
outflows, if any, pending resolution of the respective proceedings. includes `93.74 crore (March 31, 2018: `27.74 crore) in respect of
The Group does not expect any reimbursements in respect of the same. equity accounted investees.
The details of significant demands is as below:
Litigations
The Group is involved in legal proceedings, both as plaintiff and as (a)
The Company stock transfers its goods manufactured at
defendant. There are claims which the Group does not believe to be Jamshedpur works plant to its various depots/branches located
of a material nature, other than those described below. outside the state of Jharkhand across the country without
payment of Central Sales tax as per the provisions of the Act
Income tax and submits F-Form in lieu of the stock-transfers made during
The Group has ongoing disputes with income tax authorities relating the period of assessment. These goods are then sold to various
to tax treatment of certain items. These mainly include disallowance customers outside the states from depots/branches and the
of expenses, tax treatment of certain expenses claimed by the Group value of these sales are disclosed in the periodical returns
as deductions and the computation of, or eligibility of the Group’s use filed as per the Jharkhand Vat Act, 2005. The Commercial Tax
of certain tax incentives or allowances. Department has raised demand of Central Sales tax by levying
tax on the differences between value of sales outside the states
Most of these disputes and/or disallowances, being repetitive in and value of F-Form submitted for stock transfers. The amount
nature, have been raised by the income tax authorities consistently involved for various assessment years beginning 2011-12
in most of the years. to 2015-16 is amounting to `127.00 crore (March 31, 2018:
As at March 31, 2019, there are matters and/or disputes pending in `125.00 crore).
appeals amounting to `3,218.64 crore (March 31, 2018: `1,504.72 (b) The Commercial Tax Department of Jharkhand has rejected
crore) which includes `17.18 crore (March 31, 2018: `9.96 crore) in certain Input tax credit claimed by the Company on goods
respect of equity accounted investees. purchased from the suppliers within the State of Jharkhand.
The details of significant demands is as below: The Department has alleged that the goods have not been
used in accordance with the provisions of Jharkhand VAT Act,
(a)
Interest expenditure on loans taken by the Company for 2005. The potential exposure on account of disputed tax and
acquisition of a subsidiary has been disallowed in assessments interest for the period beginning 2012-2013 to 2015-2016 as on
with tax demand raised for `1,791.29 crore (inclusive of interest) March 31, 2019 is `104.00 crore (March 31,2018: `93.00 crore).
(March 31, 2018: `1,250.16 crore).
389
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
39. Contingencies and commitments (Contd.) Regulations) Act (MMDR). The Company filed revision petitions
before the Mines Tribunal against all such demand notices.
Other taxes, dues and claims Initially, a stay of demands was granted, later by order dated
Other amounts for which the Group may contingently be liable October 12, 2017, the issue has been remanded to the state for
aggregate to `12,578.82 crore (March 31, 2018: `10,782.16 crore), reconsideration of the demand in the light of Supreme Court
which includes `75.22 crore (March 31, 2018: `77.10 crore) in respect judgement passed on August 2, 2017.
of equity accounted investees.
The Hon’ble Supreme Court pronounced its judgement in the
The details of significant demands is as below: Common Cause case on August 2, 2017 wherein it directed that
compensation equivalent to the price of mineral extracted in
(a)
Claim by a party arising out of conversion arrangement
excess of environment clearance or without forest clearance
`195.79 crore (March 31, 2018: `195.79 crore). The Company
from the forest land be paid.
has not acknowledged this claim and has instead filed a claim
of `141.23 crore (March 31, 2018: `141.23 crore) on the party. In pursuance to the Judgement of Hon’ble Supreme Court,
The matter is pending before the Calcutta High Court. demand/show cause notices amounting to `3,873.35 crore have
been issued during 2017-18 by the Deputy Director of Mines,
(b)
The State Government of Odisha introduced “Orissa Rural
Odisha and the District Mining Office, Jharkhand.
Infrastructure and Socio Economic Development Act, 2004”
with effect from February 2005 levying tax on mineral bearing In respect of the above demands:
land computed on the basis of value of minerals produced from
the mineral bearing land. The Company had filed a writ petition
• asdirected by the Hon’ble Supreme Court, the Company
has provided and paid for iron ore and manganese ore an
in the High Court of Orissa challenging the validity of the Act.
amount of `614.41 crore during 2017-18 for production in
Orissa High Court held in December 2005 that the State does not
excess of environment clearance to the Deputy Director
have authority to levy tax on minerals. The State of Odisha filed
of Mines, Odisha.
an appeal in the Supreme Court against the order of Orissa High
Court and the case is pending in Supreme Court. The potential • the Company has provided and paid under protest an
liability, as at March 31, 2019 is `7,573.53 crore (March 31, 2018: amount of `56.97 crore during 2017-18 for production in
`6,521.05 crore). excess of environment clearance to the District Mining
Office, Jharkhand.
(c) The Company pays royalty on iron ore on the basis of quantity
removed from the leased area at the rates based on notification • theCompany has challenged the demands amounting to
issued by the Ministry of Mines, Government of India and the `132.91 crore during 2017-18 for production in excess of
price published by India Bureau of Mines (IBM) on a monthly lower of mining plan and consent to operate limits raised
basis. Demand of `411.08 crore has been raised by Deputy by the Deputy Director of Mines, Odisha before the Mines
Director of Mines, Joda, claiming royalty at sized ore rates on Tribunal and obtained a stay on the matter. Mines Tribunal,
despatches of ore fines. The Company has filed a revision petition Delhi vide order dated November 26, 2018 disposed of all
on November 14, 2013 before the Mines Tribunal, Government the revision applications with a direction to remand it to
of India, Ministry of Mines, New Delhi, challenging the legality the State Government to hear all such cases afresh and pass
and validity of the demand raised and to grant refund of royalty detailed order. The demand amount of `132.91 crore is
paid in excess by the Company. Mines Tribunal has granted stay considered contingent.
on the total demand with directive to Government of Odisha
not to take any coercive action for realisation of this demanded
• the Company has made a comprehensive submission before
the Deputy Director of Mines, Odisha against show cause
amount. Likely demand of royalty on fines at sized ore rates
notices amounting to `694.02 crore received during 2017-18
as on March 31, 2019 is `1,630.16 crore (March 31, 2018:
for production in violation of mining plan, Environment
`1,036.53 crore).
Protection Act, 1986 and Water (Prevention & Control of
(d) Demand notices were originally issued by the Deputy Director Pollution) Act, 1981. A demand amounting to `234.74 crore
of Mines, Odisha amounting to `3,827.29 crore for excess has been received in April 2018 crore from the Deputy
production over the quantity permitted under the mining Director of Mines, Odisha for production in excess of the
plan, environment clearance or consent to operate, pertaining Environmental Clearance. The Company has challenged
to 2000-01 to 2009-10. The demand notices have been raised the demand and obtained a stay on the matter from the
under Section 21(5) of the Mines & Minerals (Development and Revisionary Authority, Mines Tribunal, New Delhi. The demand
NOTES
forming part of the consolidated financial statements
While the proceedings in this regard were in progress, the (e) The Group has given guarantees aggregating `188.00 crore
Company had applied for allocation of fresh limits. (March 31, 2018: `205.73 crore) details of which are as below:
Over the years, there has also been a steep increase in water (i)
in favour of Commissioner of Customs `1.07 crore
charges against which the Company filed writ petitions before (March 31, 2018: `1.07 crore) given on behalf of Timken
the Hon’ble High Court of Odisha. In this regard, the Company India Limited in respect of goods imported.
has received demands of `118.70 crore for the period beginning (ii) in favour of Mizuho Corporate Bank Ltd., Japan for `9.60
January 1996 to May 2018. The potential exposure as on crore (March 31, 2018: `27.33 crore) against the loan
March 31, 2019 is `125.98 crore (March 31, 2018: `99.34 crore) is granted to a joint venture Tata NYK Shipping Pte. Limited.
considered contingent.
(iii)
in favour of The President of India for `177.18 crore
B. Commitments (March 31, 2018: `177.18 crore) against performance of
(a) The Group has entered into various contracts with suppliers export obligations under various bonds executed by a joint
and contractors for the acquisition of plant and machinery, venture Jamshedpur Continuous Annealing & Processing
equipment and various civil contracts of capital nature Company Private Limited.
amounting to `10,175.00 crore, which includes `30.30 crore (iv) in favour of President of India for `0.15 crore (March 31,
in respect of equity accounted investees (March 31, 2018: 2018: `0.15 crore) against advance license.
`8,001.50 crore which includes `4.83 crore in respect of equity
accounted investees). 40. Other significant litigations
Other commitment as at March 31, 2018 amounts to `0.01 crore (a) Odisha Legislative Assembly issued an amendment to Indian
which includes Nil in respect of equity accounted investees Stamp Act, 1889, on May 9, 2013 and inserted a new provision
(March 31, 2018: `0.01 crore which includes Nil in respect of (Section 3A) in respect of stamp duty payable on grant/renewal
equity accounted investees). of mining leases. As per the amended provision, stamp duty is
levied equal to 15% of the average royalty that would accrue
(b) The Company has given undertakings to: out of the highest annual extraction of minerals under the
(i)
IDBI not to dispose of its investment in Wellman approved mining plan multiplied by the period of such mining
Incandescent India Ltd., lease. The Company had filed a writ petition challenging the
constitutionality of the Act on July 5, 2013. The Hon’ble High
(ii) IDBI and ICICI Bank Ltd. (formerly ICICI) not to dispose of its Court, Cuttack passed an order on July 9, 2013 granting interim
investment in Standard Chrome Ltd.,
391
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
40. Other significant litigations (Contd.) provides for extension of such mining leases whose applications
for renewal have remained pending with the State(s). Based on
stay on the operation of the Amendment Act, 2013. Because of the new Ordinance, Jharkhand Government revised the Express
the stay, as on date, the Act is not enforceable and any demand Order on February 12, 2015 for extending the period of lease
received by the Company is not liable to be proceeded with. upto March 31, 2030 with the following terms and conditions:
Meanwhile, the Company received demand notices for the
various mines at Odisha totalling to `5,579.00 crore (March 31,
• value of iron ore produced by alleged unlawful mining during
the period January 1, 2012 to April 20, 2014 for `2,994.49 crore
2018: `5,579.00 crore). The Company has concluded that it is
to be decided on the basis of disposal of our writ petition
remote that the claim will sustain on ultimate resolution of the
before Hon’ble High Court of Jharkhand.
legal case by the court.
In April, 2015, the Company has received an intimation from
• value of iron ore produced from April 21, 2014 to
July 17, 2014 amounting to `421.83 crore to be paid in
Government of Odisha, granting extension of validity period for
maximum 3 instalments.
leases under the MMDR Amendment Act, 2015 up to March 31,
2030 in respect of eight mines and up to March 31, 2020 for • value of iron ore produced from July 18, 2014 to August 31,
two mines subject to execution of supplementary lease deed. 2014 `152.00 crore to be paid immediately.
Liability has been provided in the books of accounts as on
District Mining Officer Chaibasa on March 16, 2015 issued a
March 31, 2019 as per the existing provisions of the Stamp Act,
demand notice for payment of `421.83 crore in three monthly
1899 and the Company had paid the stamp duty and registration
installments. The Company on March 20, 2015 replied that since
charges totalling `413.72 crore (March 31, 2018: `413.72 crore)
the lease has been extended by application of law till March 31,
for supplementary deed execution in respect of eight mines out
2030, the above demand is not tenable. The Company, however
of the above mines.
paid `50.00 crore under protest on July 27, 2015, because the
b) Noamundi Iron Mine of TSL was due for its third renewal with State had stopped issuance of transit permits.
effect from January 01, 2012. The application for renewal was
The Company filed another writ petition before the Hon’ble
submitted by the company within the stipulated time, but it
High Court of Jharkhand which was heard on September 9,
remained pending consideration with the State and the mining
2015. An interim order was given by the Hon’ble High Court
operations were continued in terms of the prevailing law.
of Jharkhand on September 17, 2015, wherein the Court has
By a judgement of April 2014 in the case of Goa mines, the directed the Company to pay the amount of `371.83 crore in 3
Supreme Court took a view that second and subsequent renewal equal instalments, first instalment by October 15, 2015, second
of mining lease can be effected once the State considers the instalment by November 15, 2015 and third instalment by
application and decides to renew the mining lease by issuing December 15, 2015.
an express order. State of Jharkhand issued renewal order to
In view of the interim order of the Hon’ble High Court of
the Company on December 31, 2014. The State, however, took
Jharkhand `124.00 crore was paid on September 28, 2015,
a view on an interpretation of Goa judgment that the mining
`124.00 crore on November 12, 2015 and `123.83 crore on
carried out after expiry of the period of second renewal was
December 14, 2015 under protest.
‘illegal’ and hence, issued a demand notice of `3,568.31 crore
being the price of iron ore extracted. The said demand has been The case is pending at Hon’ble High court for disposal. The State
challenged by the Company before the Jharkhand High Court. issued similar terms and conditions to other mining lessees
in the State rendering the mining as illegal. Based on the
The mining operations were suspended from August 1, 2014.
Company’s assessment of the Goa mines judgement read with
Upon issuance of an express order, the Company paid `152.00
the Ordinance issued in the year 2015, the Company believes
crore under protest, so that mining can be resumed.
that it is remote that the demand of the State would sustain.
The Mines and Minerals Development and Regulation (MMDR)
Amendment Ordinance 2015 promulgated on January 12, 2015
NOTES
forming part of the consolidated financial statements
Fair value as on
acquisition date
Non-current assets
Property, plant and equipment 29,511.90
Capital work-in-progress 1,222.28
Other intangible assets 0.10
Investments 1.13
Financial assets 565.80
Non-current tax assets 29.29
Other assets 1,433.22
32,763.72
Current assets
Inventories 4,219.48
Trade receivables 1,288.33
Cash and cash equivalents 712.14
Other balances with banks 552.97
Other financial assets 63.90
Other assets 1,072.32
7,909.14
Total assets [A] 40,672.86
Non-current liabilities
Borrowings 19,276.99
Other financial liabilities 40.01
Provisions 20.36
Retirement benefit obligations 34.01
Deferred income 2.61
19,373.98
Current liabilities
Borrowings 16,638.47
Trade payables 937.27
Other financial liabilities 1,155.16
Provisions 7.54
Other liabilities 641.56
19,380.00
Total liabilities [B] 38,753.98
Fair value of identifiable net assets [C=A-B] 1,918.88
393
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
NOTES
forming part of the consolidated financial statements
395
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
NOTES
forming part of the consolidated financial statements
(` crore)
As at As at
March 31, 2019 March 31, 2018
Equity share capital 1,144.94 1,144.95
Hybrid perpetual securities 2,275.00 2,275.00
Other equity 65,505.14 57,450.67
Equity attributable to shareholders of the Company 68,925.08 60,870.62
Non-controlling interests 2,364.46 936.52
Total equity (A) 71,289.54 61,807.14
397
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
T his section gives an overview of the significance of financial instruments for the Group and provides additional information on balance sheet
items that contain financial instruments.
The details of significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which income
and expenses are recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in note 2(r), page
320 to the consolidated financial statements.
(a) Financial assets and liabilities
The following tables present the carrying value and fair value of each category of financial assets and liabilities as at March 31, 2019 and
March 31, 2018.
Financial assets:
Cash and bank balances 3,412.36 - - - - 3,412.36 3,412.36
Trade receivables 11,811.00 - - - - 11,811.00 11,811.00
Investments 65.21 756.39 - - 2,993.62 3,815.22 3,815.22
Derivatives - - 184.44 283.41 - 467.85 467.85
Loans 853.04 - - - - 853.04 853.04
Other financial assets 1,747.63 - - - - 1,747.63 1,747.63
17,889.24 756.39 184.44 283.41 2,993.62 22,107.10 22,107.10
Financial liabilities:
Trade payables 21,716.96 - - - - 21,716.96 21,716.96
Borrowings 1,00,816.22 - - - - 1,00,816.22 99,893.42
Derivatives - - 216.35 260.06 - 476.41 476.41
Other financial liabilities 7,337.00 - - - - 7,337.00 7,337.00
1,29,870.18 - 216.35 260.06 - 1,30,346.59 1,29,423.79
NOTES
forming part of the consolidated financial statements
Financial assets:
Cash and bank balances 8,022.87 - - - - 8,022.87 8,022.87
Trade receivables 12,415.52 - - - - 12,415.52 12,415.52
Investments 0.22 876.65 - - 15,241.38 16,118.25 16,118.25
Derivatives - - 87.89 92.22 - 180.11 180.11
Loans 973.82 - - - - 973.82 973.82
Other financial assets 613.49 - - - - 613.49 613.49
22,025.92 876.65 87.89 92.22 15,241.38 38,324.06 38,324.06
Financial liabilities:
Trade payables 20,413.81 - - - - 20,413.81 20,413.81
Borrowings 92,147.05 - - - - 92,147.05 91,516.09
Derivatives - - 350.37 203.46 - 553.83 553.83
Other financial liabilities 6,424.64 - - - - 6,424.64 6,424.64
1,18,985.50 - 350.37 203.46 - 1,19,539.33 1,18,908.37
(i) Investments in mutual funds and derivative instruments (other than those designated in a hedging relationship) are mandatorily classified
as fair value through profit and loss.
399
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(` crore)
As at March 31, 2019
Level 1 Level 2 Level 3 Total
Financial assets:
Investments in mutual funds 2,633.13 - - 2,633.13
Investments in equity shares 454.53 - 362.61 817.14
Investments in bonds and debentures - 49.74 - 49.74
Investments in preference shares - - 250.00 250.00
Derivative financial assets - 467.85 - 467.85
3,087.66 517.59 612.61 4,217.86
Financial liabilities:
Derivative financial liabilities - 476.41 - 476.41
- 476.41 - 476.41
(` crore)
As at March 31, 2018
Level 1 Level 2 Level 3 Total
Financial assets:
Investments in mutual funds 14,979.89 - - 14,979.89
Investments in equity shares 608.16 - 388.94 997.10
Investments in bonds and debentures 91.30 49.74 - 141.04
Derivative financial assets - 180.11 - 180.11
15,679.35 229.85 388.94 16,298.14
Financial liabilities:
Derivative financial liabilities - 553.83 - 553.83
- 553.83 - 553.83
Notes:
(i) Current financial assets and liabilities are stated at carrying value which is approximately equal to their fair value.
(ii) Derivatives are fair valued using market observable rates and published prices together with forecasted cash flow information
where applicable.
(iii) Investments carried at fair value are generally based on market price quotations. Investments included in Level 3 of the fair value hierarchy
have been valued using the cost approach to arrive at their fair value. Cost of unquoted equity instruments has been considered as an
appropriate estimate of fair value because of a wide range of possible fair value measurements and cost represents the best estimate of
fair value within that range. Fair value of investment in preference shares is estimated by discounting the expected future cash flows using
a discount rate equivalent to the expected rate of return for a similar instrument and maturity as on the reporting date.
(iv) Fair value of borrowings which have a quoted market price in an active market is based on its market price which is categorised as Level 1.
Fair value of borrowings which do not have an active market or are unquoted is estimated by discounting the expected future cash flows
using a discount rate equivalent to the risk-free rate of return adjusted for credit spread considered by lenders for instruments of similar
maturities which is categorised as Level 2 in the fair value hierarchy.
(v) Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in
any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily
indicative of the amounts that the Group could have realised or paid in sale transactions as of respective dates. As such, fair value of
financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.
(vi) There have been no transfers between Level 1 and Level 2 for the years ended March 31, 2019 and March 31, 2018.
NOTES
forming part of the consolidated financial statements
(` crore)
Year ended Year ended
March 31, 2019 March 31, 2018
Balance at the beginning of the year 388.94 452.60
Additions during the year 267.92 -
Fair value changes during the year (0.02) (72.68)
Classified as held for sale (23.60) -
Reclasification within investments * (17.00) -
Exchange rate differences on consolidation (3.63) 9.02
Balance at the end of the year 612.61 388.94
* represents investment held in Subarnarekha Port Private Limited which became a subsidiary during the year.
(` crore)
As at March 31, 2019 As at March 31, 2018
Assets Liabilities Assets Liabilities
(a) Foreign currency forwards, futures, swaps and options 360.07 476.34 133.23 532.38
(b) Commodity futures and options 90.56 - 32.42 18.92
(c) Interest rate swaps and collars 17.22 0.07 14.46 2.53
467.85 476.41 180.11 553.83
Classified as:
Non-current 108.74 59.82 29.16 85.04
Current 359.11 416.59 150.95 468.79
As at the end of the reporting period, total notional amount of outstanding foreign currency contracts, commodity futures, options, interest
rate swaps and collars that the Group has committed to is as below:
(US$ million)
As at As at
March 31, 2019 March 31, 2018
(i) Foreign currency forwards, futures, swaps and options 7,722.00 7,072.23
(ii) Commodity futures and options 115.40 150.07
(iii) Interest rate swaps and collars 150.00 1,764.39
7,987.40 8,986.69
401
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(e) Financial risk management one currency or where assets/liabilities are denominated in a
In the course of its business, the Group is exposed primarily to currency other than the functional currency of the respective
fluctuations in foreign currency exchange rates, commodity consolidated entities.
prices, interest rates, equity prices, liquidity and credit risk, which Considering the countries and economic environment in which
may adversely impact the fair value of its financial instruments. the Group operates, its operations are subject to risks arising
Entities within the Group have a risk management policy from fluctuations in exchange rates in those countries. The risks
which not only covers the foreign exchange risks but also other primarily relate to fluctuations in US Dollar, Great British Pound,
risks associated with the financial assets and liabilities such as Euro, Singapore Dollar, and Thai Baht against the respective
interest rate risks and credit risks. The risk management policy is functional currencies of the Company and its subsidiaries.
approved by the Board of Directors of the respective companies. Entities as per their risk management policy, use foreign
The risk management framework aims to: exchange and other derivative instruments primarily to hedge
(i) create a stable business planning environment by reducing foreign exchange and interest rate exposure. Any weakening
the impact of currency, commodity prices and interest rate of the functional currency may impact the respective entities’
fluctuations on the entity’s business plan. cost of imports and cost of borrowings and consequently may
increase the cost of financing the Group’s capital expenditures.
(ii) achieve greater predictability to earnings by determining
the financial value of the expected earnings in advance. A 10% appreciation/depreciation of foreign currencies with
respect to the functional currency of the entities within the
(i) Market risk Group would result in a decrease/increase in the Group’s
Market risk is the risk of any loss in future earnings, in realisable net profit and equity before considering tax impacts by
fair values or in future cash flows that may result from a change approximately `1,278.28 crore for the year ended March 31,
in the price of a financial instrument. The value of a financial 2019 (2017-18 `680.05 crore) and increase/decrease in carrying
instrument may change as a result of changes in interest rates, value of property, plant and equipment (before considering
foreign currency exchange rates, commodity prices, equity price depreciation impact) by approximately `101.04 crore as at
fluctuations, liquidity and other market changes. Future specific March 31, 2019 (March 31, 2018: `148.81 crore).
market movements cannot be normally predicted with The foreign exchange rate sensitivity is calculated by assuming
reasonable accuracy. a simultaneous parallel foreign exchange rates shift of all the
currencies by 10% against the functional currency of the entities
(a) Market risk - Foreign currency exchange rate risk:
within the Group.
The fluctuation in foreign currency exchange rates may have
potential impact on the consolidated statement of profit and The sensitivity analysis has been based on the composition of the
loss and equity, where any transaction references more than Group’s financial assets and liabilities as at March 31, 2019 and
NOTES
forming part of the consolidated financial statements
403
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
44. Disclosures on financial instruments (Contd.) The Group has obtained fund and non-fund based working
capital lines from various banks. Furthermore, the entities
In respect of financial guarantees provided by the Group to within the Group have access to undrawn lines of committed
banks/financial institutions, the maximum exposure which the and uncommitted borrowing/facilities, funds from debt
Group is exposed to is the maximum amount which the Group markets through commercial paper programs, non-convertible
would have to pay if the guarantee is called upon. Based on debentures and other debt instruments. The Group invests its
the expectation at the end of the reporting period, the Group surplus funds in bank fixed deposits and mutual funds, which
considers that it is more likely than not that such an amount will carry no or low mark to market risk.
not be payable under the guarantees provided.
The following table shows a maturity analysis of the anticipated cash flows including future interest obligations for the Group’s derivative
and non-derivative financial liabilities on an undiscounted basis, which therefore differ from both carrying value and fair value. Floating rate
interest is estimated using the prevailing interest rate at the end of the reporting period. Cash flows in foreign currencies are translated using
the period end spot rates.
(` crore)
As at March 31, 2019
Carrying Contractual less than between one to More than
value cash flows one year five years five years
Non-derivative financial liabilities:
Borrowings including interest obligations 1,01,674.75 1,34,845.14 21,955.48 52,896.95 59,992.71
Trade payables 21,716.96 21,716.96 21,716.96 - -
Other financial liabilities 6,478.47 6,478.47 6,217.46 21.62 239.39
1,29,870.18 1,63,040.57 49,889.90 52,918.57 60,232.10
(` crore)
As at March 31, 2018
Carrying Contractual less than between one to More than
value cash flows one year five years five years
Non-derivative financial liabilities:
Borrowings including interest obligations 92,982.57 1,16,791.20 21,366.81 54,309.71 41,114.68
Trade payables 20,413.81 20,413.81 20,413.81 - -
Other financial liabilities 5,589.12 5,589.12 5,501.46 27.60 60.06
1,18,985.50 1,42,794.13 47,282.08 54,337.31 41,174.74
NOTES
forming part of the consolidated financial statements
405
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
(iii) Details of non-current assets (property, plant and equipment, capital work-in-progress, intangibles and goodwill on
consolidation) based on geographical area is as below:
(` crore)
As at As at
March 31, 2019 March 31, 2018
India 1,10,980.41 80,930.93
Outside India 32,102.71 31,788.37
1,43,083.12 1,12,719.30
Non-current assets outside India include: Asia excluding India `2.55 crore (March 31, 2018: `1,477.15 crore), UK `7,981.67 crore (March 31,
2018: `6,662.42 crore) and other European countries `17,191.20 crore (March 31, 2018: `17,292.55 crore).
NOTES
forming part of the consolidated financial statements
Notes:
(i) Segment performance is reviewed by the CODM on the basis of profit or loss from continuing operations before finance income/cost,
depreciation and amortisation expenses, share of profit/(loss) of joint ventures and associates and tax expenses. Segment results reviewed
by the CODM also exclude income or expenses which are non-recurring in nature and are classified as an exceptional item. Information about
segment assets and liabilities provided to the CODM, however, include the related assets and liabilities arising on account of items
excluded in measurement of segment results. Such amounts, therefore, form part of the reported segment assets and liabilities.
(ii) The Group executed definitive agreements to divest its entire equity stake in NatSteel Holdings Pte. Ltd. and Tata Steel (Thailand) Public
Company Ltd. The assets and liabilities of these companies have been classified as held for sale as on March 31, 2019 and have been
presented separately in the Consolidated Balance Sheet. The results for the current period of these companies have been disclosed within
discontinued operations and results for the previous periods have been restated accordingly. Consequent to the re-classification, ‘South
East Asian Operations’ is no longer presented as a separate segment.
(iii) No single customer represents 10% or more of the Group’s total revenue during the year ended March 31, 2019 and March 31, 2018.
(iv) The accounting policies of the reportable segments are the same as of the Group’s accounting policies.
46.
Related party transactions
The Group’s related parties primarily consists of its associates, joint ventures and Tata Sons Private Limited including its subsidiaries and
joint ventures. The Group routinely enters into transactions with these related parties in the ordinary course of business at market rates
and terms. Transactions and balances between the Company, its subsidiaries and fellow subsidiaries are eliminated on consolidation.
The following table summarises the related-party transactions and balances included in the consolidated financial statements for the year
ended/as at March 31, 2019 and March 31, 2018.
(` crore)
Associates Joint Tata Sons Private Total
ventures Limited, its
subsidiaries and
joint ventures
Purchase of goods 488.88 186.86 710.83 1,386.57
300.07 129.18 455.67 884.92
407
CONSOLIDATED
NOTES
forming part of the consolidated financial statements
Finance provided during the year (net of repayments) 250.00 134.91 - 384.91
- 46.82 - 46.82
Provision for outstanding loans and receivables 10.71 1,023.31 0.02 1,034.04
3.39 977.80 - 981.19
NOTES
forming part of the consolidated financial statements
47. The Board of Directors of the Company have considered and approved a merger of Bamnipal Steel Limited and Tata Steel BSL Limited
(formerly Bhushan Steel Limited) into the Company by way of a composite scheme of amalgamation and have recommended a merger
ratio of 1 equity share of 10/-each fully paid up of the Company for every 15 equity shares of 2/- each fully paid up held by the public
shareholders of Tata Steel BSL Limited. The merger is subject to shareholders and other regulatory approvals.
48. On April 9, 2019, Tata Sponge Iron Limited, a subsidiary of the Company completed the acquisition of the steel business of Usha Martin
Limited (UML) followed by signing of definitive agreement in September 2018. The acquisition involves UML’s 1.0 MnTPA speciality steel
plant in Jamshedpur that makes alloy based long products, a functional iron ore mine, a coal mine under development and captive power
plants. The acquisition involves cash consideration after adjustment for negative working capital and debt like items payable to UML
of `4,094.07 crore, which is subject to further hold backs of `640.00 crore, pending transfer of some of the assets including mines and
certain land parcels.
49. The Company and its Indian subsidiaries is in the process of evaluating the impact of the recent Supreme Court Judgement in case of
"Vivekananda Vidyamandir and Others Vs The Regional Provident Fund Commissioner (II) West Bengal" and the related circular (Circular
No. CI/ 1(33)2019/Vivekananda Vidya Mandir/284) dated March 20, 2019 issued by the Employees’ Provident Fund Organisation in relation
to non-exclusion of certain allowances from the definition of "basic wages" of the relevant employees for the purposes of determining
contribution to provident fund under the Employees' Provident Funds & Miscellaneous Provisions Act, 1952. In the assessment of the
management which is supported by legal opinion, the aforesaid matter is not likely to have a significant impact and accordingly no
provision has been considered in the consolidated financial statements.
50. On June 30, 2018, the Company and Thyssenkrupp AG signed definitive agreements to combine their European steel businesses in 50:50
joint venture in a new company. This follows the signing of a Memorandum of Understanding in September 2017. The proposed new
company, to be named thyssenkrupp Tata Steel BV, will be positioned as a leading pan European high quality flat steel producer with
a strong focus on performance, quality and technology leadership. The transaction is subject to merger control clearance in several
jurisdictions, including the European Union. The business proposed to be contributed to the joint venture has not been classified as held
for sale as at March 31, 2019.
51. Dividend
The dividend declared by the Company is based on profits available for distribution as reported in the standalone financial statements of
the Company. On April 25, 2019, the Board of Directors of the Company have proposed a dividend of `13.00 per Ordinary Share of `10
each and `3.25 per partly paid Ordinary Share of `10 each (paid up `2.504 per share) in respect of the year ended March 31, 2019 subject
to the approval of shareholders at the Annual General Meeting. If approved, the dividend would result in a cash outflow of `1,794.33 crore
inclusive of dividend distribution tax of `306.21 crore.
409
410
53. Statement of net assets and profit or loss attributable to owners and non-controlling interests
Reporting Net assets, i.e. total assets Share in profit or (loss) Share in other Share in total
NOTES
Name of the entity currency minus total liabilities comprehensive income comprehensive income
A. Parent
Tata Steel Limited INR 105.52 72,729.71 103.08 10,533.19 (34.74) (50.22) 101.16 10,482.97
B. Subsidiaries
a) Indian
1 Kalzip India Private Limited INR - - 0.00 0.28 (4.19) (6.05) (0.06) (5.77)
2 Tata Steel International (India) Limited INR 0.07 45.79 0.03 2.93 - - 0.03 2.93
3 Jamshedpur Utilities & Services Company Limited INR 0.20 137.34 0.44 44.95 0.46 0.66 0.44 45.61
4 Haldia Water Management Limited INR (0.11) (76.69) 0.95 97.20 - - 0.94 97.20
5 Kalimati Global Shared Services Limited INR 0.01 4.01 0.00 0.26 - - 0.00 0.26
forming part of the consolidated financial statements
6 Tata Sponge Iron Limited INR 1.57 1,083.47 1.22 124.33 6.81 9.85 1.29 134.18
7 TSIL Energy Limited INR 0.00 1.22 0.00 0.06 - - 0.00 0.06
8 Creative Port Development Private Limited INR (0.00) (0.81) (0.00) (0.06) - - (0.00) (0.06)
b) Foreign
1 Apollo Metals Limited USD 0.24 163.79 0.35 36.11 (3.80) (5.50) 0.30 30.61
2 Automotive Laser Technologies Limited GBP 0.00 0.00 - - - - - -
3 Beheermaatschappij Industriele Produkten B.V. EUR (0.08) (54.75) (0.01) (0.58) - - (0.01) (0.58)
4 Bell & Harwood Limited GBP - - - - - - - -
5 Blastmega Limited GBP 1.22 841.97 - - - - - -
6 Blume Stahlservice GmbH EUR - - - - - - - -
7 Bore Samson Group Limited GBP 0.20 135.86 - - 131.51 190.10 1.83 190.10
8 Bore Steel Limited GBP 0.21 144.84 - - 100.20 144.84 1.40 144.84
9 British Guide Rails Limited GBP 0.06 43.98 - - 1.88 2.72 0.03 2.72
10 British Steel Corporation Limited GBP 0.40 276.14 - - - - - -
forming part of the consolidated financial statements
411
412
53. Statement of net assets and profit or loss attributable to owners and non-controlling interests (Contd.)
Reporting Net assets, i.e. total assets Share in profit or (loss) Share in other Share in total
NOTES
Name of the entity currency minus total liabilities comprehensive income comprehensive income
44 Corus Ireland Limited EUR 0.01 7.42 0.01 0.87 - - 0.01 0.87
45 Corus Large Diameter Pipes Limited GBP 0.96 658.49 - - - - - -
46 Corus Liaison Services (India) Limited GBP (0.03) (21.64) - - - - - -
47 Corus Management Limited GBP 0.23 155.26 - - - - - -
48 Corus Primary Aluminium B.V. EUR (0.18) (121.81) (0.03) (2.74) - - (0.03) (2.74)
49 Corus Property GBP 0.00 0.00 - - - - - -
50 Corus Service Centre Limited GBP 0.21 144.48 - - 21.79 31.50 0.30 31.50
51 Corus Steel Service STP LLC RUB (0.00) (0.51) (0.00) (0.33) - - (0.00) (0.33)
52 Corus Tubes Poland Spolka Z.O.O EUR 0.00 0.34 - - - - - -
53 Corus UK Healthcare Trustee Limited GBP 0.00 0.00 - - - - - -
54 Corus Ukraine Limited Liability Company UAH 0.00 0.02 - - - - - -
forming part of the consolidated financial statements
88 Montana Bausysteme AG CHF 0.15 100.91 0.22 22.73 0.23 0.33 0.22 23.06
89 Naantali Steel Service Centre OY EUR 0.03 20.01 (0.07) (6.71) - - (0.06) (6.71)
90 Nationwide Steelstock Limited GBP - - - - - - - -
91 Norsk Stal Tynnplater AB NOK 0.02 16.21 0.01 1.04 - - 0.01 1.04
92 Norsk Stal Tynnplater AS NOK 0.07 46.83 (0.17) (17.15) - - (0.17) (17.15)
93 Orb Electrical Steels Limited GBP 0.00 0.00 - - - - - -
94 Ore Carriers Limited GBP 0.04 25.79 - - - - - -
95 Oremco Inc. USD (0.02) (13.99) (0.01) (0.52) - - (0.01) (0.52)
96 Plated Strip (International) Limited GBP 0.02 16.09 - - - - - -
97 Precoat International Limited GBP 0.10 70.17 - - - - - -
98 Precoat Limited GBP (0.03) (19.21) - - - - - -
forming part of the consolidated financial statements
99 Rafferty-Brown Steel Co Inc Of Conn. USD 0.04 29.10 (0.01) (0.73) - - (0.01) (0.73)
100 Round Oak Steelworks Limited GBP (0.63) (433.73) - - - - - -
101 Runblast Limited GBP 0.68 471.06 - - - - - -
102 Runmega Limited GBP 0.01 3.94 - - - - - -
STATUTORY REPORTS | 89-194
103 S A B Profiel B.V. EUR 0.37 254.77 0.12 12.32 - - 0.12 12.32
104 S A B Profil GmbH EUR 0.19 132.01 (0.02) (2.24) - - (0.02) (2.24)
105 Seamless Tubes Limited GBP 0.24 168.09 - - - - - -
106 Service Center Gelsenkirchen Gmbh EUR 0.26 176.65 0.19 19.79 (163.48) (236.31) (2.09) (216.52)
107 Service Centre Maastricht B.V. EUR 0.08 52.02 (0.07) (7.45) - - (0.07) (7.45)
108 Societe Europeenne De Galvanisation (Segal) Sa EUR 0.32 222.58 0.11 11.59 - - 0.11 11.59
109 Staalverwerking En Handel B.V. EUR 1.00 687.20 (0.04) (3.68) - - (0.04) (3.68)
110 Steel Stockholdings Limited GBP 0.06 41.47 - - 25.16 36.37 0.35 36.37
111 Steelstock Limited GBP 0.00 0.18 - - - - - -
112 Stewarts & Lloyds Of Ireland Limited EUR - - - - - - - -
113 Stewarts And Lloyds (Overseas) Limited GBP 0.27 185.27 - - - - - -
114 Surahammar Bruks AB SEK 0.08 52.05 (0.52) (52.90) (1.47) (2.12) (0.53) (55.02)
115 Swinden Housing Association Limited GBP 0.02 11.31 - - - - - -
116 Tata Steel Belgium Packaging Steels N.V. EUR 0.22 150.23 0.07 6.66 - - 0.06 6.66
117 Tata Steel Belgium Services N.V. EUR 0.30 204.17 0.03 2.79 (0.45) (0.65) 0.02 2.14
FINANCIAL STATEMENTS | 195-418
118 Tata Steel Denmark Byggsystemer A/S DKK 0.03 21.81 0.01 0.65 - - 0.01 0.65
119 Tata Steel Europe Limited GBP (21.41) (14,758.56) 25.88 2,644.42 (0.19) (0.27) 25.52 2,644.15
120 Tata Steel Europe Distribution BV EUR (0.03) (19.41) 0.08 8.13 - - 0.08 8.13
121 Tata Steel Europe Metals Trading BV EUR 0.42 288.21 0.00 0.43 - - 0.00 0.43
122 Tata Steel France Batiment et Systemes SAS EUR (0.10) (69.14) (0.51) (52.13) - - (0.50) (52.13)
123 Tata Steel France Holdings SAS EUR 1.26 870.83 (0.29) (29.81) - - (0.29) (29.81)
124 Tata Steel Germany GmbH EUR 0.52 359.18 0.43 44.38 (5.41) (7.82) 0.35 36.56
125 Tata Steel Ijmuiden BV EUR 29.43 20,283.53 17.27 1,764.68 (473.44) (684.35) 10.42 1,080.33
126 Tata Steel International (Americas) Holdings Inc USD 0.90 622.83 0.23 23.24 - - 0.22 23.24
127 Tata Steel International (Americas) Inc USD 1.76 1,209.72 0.19 18.95 (0.70) (1.01) 0.17 17.94
128 Tata Steel International (Canada) Holdings Inc CAD 0.00 1.94 0.00 0.09 - - 0.00 0.09
129 Tata Steel International (Czech Republic) S.R.O CZK 0.01 6.03 0.04 3.68 - - 0.04 3.68
130 Tata Steel International (Denmark) A/S DKK 0.00 2.82 0.02 1.86 - - 0.02 1.86
131 Tata Steel International (Finland) OY EUR 0.00 0.98 - - - - - -
413
53. Statement of net assets and profit or loss attributable to owners and non-controlling interests (Contd.)
414
Reporting Net assets, i.e. total assets Share in profit or (loss) Share in other Share in total
NOTES
Name of the entity currency minus total liabilities comprehensive income comprehensive income
132 Tata Steel International (France) SAS EUR 0.06 38.86 0.02 2.15 - - 0.02 2.15
133 Tata Steel International (Germany) GmbH EUR 0.00 1.69 0.17 17.06 (1.65) (2.38) 0.14 14.68
134 Tata Steel International (Italia) SRL EUR 0.01 9.79 (0.52) (53.49) - - (0.52) (53.49)
135 Tata Steel International (Middle East) FZE UAE 0.18 122.29 0.19 19.01 - - 0.18 19.01
136 Tata Steel International (Nigeria) Limited NGN - - - - - - - -
137 Tata Steel International (Poland) sp Zoo PLZ 0.01 4.62 0.00 0.36 - - 0.00 0.36
138 Tata Steel International (Schweiz) AG CHF 0.01 4.81 0.00 0.04 - - 0.00 0.04
139 Tata Steel International (South America) USD 0.00 1.20 0.00 0.35 - - 0.00 0.35
Representações LTDA
140 Tata Steel International (Sweden) AB SEK 0.01 8.99 0.02 2.20 - - 0.02 2.20
141 Tata Steel International Hellas SA EUR - - - - - - - -
forming part of the consolidated financial statements
142 Tata Steel International Iberica SA EUR 0.02 10.48 0.09 9.08 - - 0.09 9.08
143 Tata Steel Mexico SA de CV USD 0.00 0.71 0.00 0.33 - - 0.00 0.33
144 Tata Steel Istanbul Metal Sanayi ve Ticaret AS USD 0.02 11.48 (0.13) (13.67) - - (0.13) (13.67)
186 Easteel Services (M) Sdn. Bhd. MYR 0.05 37.57 0.02 2.07 - - 0.02 2.07
187 Eastern Steel Fabricators Philippines, Inc. SGD (0.06) (43.89) - - - - - -
188 NatSteel (Xiamen) Ltd. CNY 0.00 0.32 0.62 63.10 - - 0.61 63.10
189 NatSteel Recycling Pte Ltd. SGD 0.33 228.16 0.04 4.58 - - 0.04 4.58
STATUTORY REPORTS | 89-194
190 NatSteel Trade International Pte. Ltd. USD 0.02 16.15 (0.00) (0.10) - - (0.00) (0.10)
191 NatSteel Vina Co. Ltd. VND 0.09 65.02 (0.08) (8.10) - - (0.08) (8.10)
192 The Siam Industrial Wire Company Ltd. THB 1.75 1,208.53 0.56 57.60 - - 0.56 57.60
193 TSN Wires Co., Ltd. THB 0.05 33.81 (0.17) (17.54) - - (0.17) (17.54)
194 NatSteel Trade International (Shanghai) Company Ltd. CNY - - 0.01 0.88 - - 0.01 0.88
195 T S Global Minerals Holdings Pte Ltd. USD 3.66 2,525.80 (11.36) (1,160.42) - - (11.20) (1,160.42)
196 Al Rimal Mining LLC OMR 0.01 6.57 - - - - - -
197 Black Ginger 461 (Proprietary) Ltd ZAR - - 0.26 27.05 - - 0.26 27.05
198 Kalimati Coal Company Pty. Ltd. AUD - - 2.19 223.44 - - 2.16 223.44
199 Sedibeng Iron Ore Pty. Ltd. ZAR - - 1.21 123.69 - - 1.19 123.69
200 Tata Steel Cote D’ Ivoire S.A FCFA - - (0.01) (0.61) - - (0.01) (0.61)
201 TSMUK Limited USD 5.35 3,685.00 (0.00) (0.07) - - (0.00) (0.07)
202 Tata Steel Minerals Canada Limited USD 4.06 2,800.11 (0.48) (48.61) - - (0.47) (48.61)
203 T S Canada Capital Ltd USD 0.05 34.76 (0.00) (0.16) - - (0.00) (0.16)
204 Tata Steel (Thailand) Public Company Ltd. THB 4.22 2,909.38 0.14 14.04 0.30 0.44 0.14 14.48
FINANCIAL STATEMENTS | 195-418
205 N.T.S Steel Group Plc. THB 0.13 88.06 (0.62) (63.38) (0.19) (0.28) (0.61) (63.66)
206 The Siam Construction Steel Co. Ltd. THB 0.80 553.28 0.22 22.60 (0.44) (0.64) 0.21 21.96
207 The Siam Iron And Steel (2001) Co. Ltd. THB 0.39 267.89 (0.05) (5.32) (0.06) (0.08) (0.05) (5.40)
208 Tata Steel Global Procurement Company Pte. Ltd. USD 3.52 2,428.65 3.27 333.98 - - 3.22 333.98
209 ProCo Issuer Pte. Ltd. GBP 0.26 181.33 0.53 53.99 - - 0.52 53.99
210 Bhushan Steel (Australia) PTY Ltd. AUD 0.01 6.69 (0.00) (0.24) (0.35) (0.51) (0.01) (0.75)
211 Bowen Energy PTY Ltd. AUD (0.03) (22.90) (0.00) (0.23) 0.27 0.39 0.00 0.16
212 Bowen Coal PTY Ltd. AUD 0.00 0.00 - - - - - -
213 Bowen Consolidated PTY Ltd. AUD 0.00 0.00 - - - - - -
214 ABJA Investment Co. Pte Ltd. USD (0.25) (168.94) 0.91 92.77 - - 0.90 92.77
215 Tata Steel (KZN) (Pty) Ltd. ZAR - - - - - - - -
216 T Steel Holdings Pte. Ltd. GBP 11.60 7,998.70 (1.02) (103.86) - - (1.00) (103.86)
217 T S Global Holdings Pte. Ltd. GBP 8.98 6,191.97 (10.47) (1,070.33) - - (10.33) (1,070.33)
218 Orchid Netherlands (No.1) B.V. GBP 0.00 1.77 (0.00) (0.29) - - (0.00) (0.29)
415
416
53. Statement of net assets and profit or loss attributable to owners and non-controlling interests (Contd.)
Reporting Net assets, i.e. total assets Share in profit or (loss) Share in other Share in total
NOTES
Name of the entity currency minus total liabilities comprehensive income comprehensive income
C. Joint ventures
a) Indian
1 Naba Diganta Water Management Limited INR 0.02 16.89 0.03 2.73 (0.03) (0.05) 0.03 2.68
2 SEZ Adityapur Limited. INR (0.00) (0.04) - - - - - -
3 Himalaya Steel Mill Services Private Limited INR 0.01 4.15 0.01 1.15 - - 0.01 1.15
4 mjunction services limited INR 0.20 139.62 0.20 20.84 0.03 0.04 0.20 20.88
5 S & T Mining Company Private Limited INR (0.01) (4.61) - - - - - -
6 Tata BlueScope Steel Private Limited INR 0.58 400.52 0.79 80.71 0.09 0.13 0.78 80.84
7 Tata NYK Shipping (India) Private Limited INR 0.00 1.74 0.00 0.04 - - 0.00 0.04
8 Jamshedpur Continuous Annealing & Processing INR 0.54 371.37 0.17 17.26 0.05 0.07 0.17 17.33
Company Private Limited
forming part of the consolidated financial statements
9 TM International Logistics Limited INR 0.29 198.72 0.19 19.76 0.04 0.06 0.19 19.82
10 TKM Global Logistics Limited INR 0.04 27.72 0.02 1.79 0.03 0.05 0.02 1.84
11 Industrial Energy Limited INR 0.29 199.33 0.28 28.89 0.05 0.07 0.28 28.96
D. Associates
a) Indian
1 TRF Limited. INR (0.03) (22.89) (0.35) (36.01) 1.26 1.82 (0.33) (34.19)
2 YORK Transport Equipment India Pvt. Ltd INR - - 0.00 0.45 - - 0.00 0.45
3 Malusha Travels Pvt Ltd INR - - - - - - - -
4 Kalinga Aquatic Ltd INR - - - - - - - -
5 Kumardhubi Fireclay & Silica Works Ltd. INR - - - - - - - -
6 Kumardhubi Metal Casting and Engineering Limited INR - - - - - - - -
7 Strategic Energy Technology Systems Private Limited INR - - - - - - - -
CONSOLIDATED
53. Statement of net assets and profit or loss attributable to owners and non-controlling interests (Contd.)
Reporting Net assets, i.e. total assets Share in profit or (loss) Share in other Share in total
Name of the entity currency minus total liabilities comprehensive income comprehensive income
NOTES
As % of Amount As % of Amount As % of consolidated Amount As % of total Amount
consolidated (` crore) consolidated (` crore) other comprehensive (` crore) comprehensive (` crore)
net assets profit or loss income income
STRATEGIC REPORT | 1-88
6 Wupperman Staal Nederland B.V. EUR 0.18 126.48 0.15 14.97 - - 0.14 14.97
7 European Profiles (M) Sdn. Bhd. MYR - - - - - - - -
8 New Millennium Iron Corp. CAD 0.05 35.10 (0.04) (3.74) - - (0.04) (3.74)
9 9336-0634 Québec Inc CAD - - - - - - - -
STATUTORY REPORTS | 89-194
10 TRF Singapore Pte Limited SGD 0.07 44.93 0.07 6.79 (5.65) (8.17) (0.01) (1.38)
11 TRF Holdings Pte Limited USD - - 0.15 15.15 (0.69) (1.00) 0.14 14.15
12 Dutch Lanka Trailer Manufacturers Limited USD 0.01 8.11 0.04 3.78 (0.15) (0.21) 0.03 3.57
13 Dutch Lanka Engineering (Private) Limited LKR 0.00 1.61 0.00 0.10 (0.15) (0.21) (0.00) (0.11)
14 Dutch Lanka Trailer LLC OMR - - (0.00) (0.23) - - (0.00) (0.23)
15 Hewitt Robins International Ltd GBP 0.02 15.32 0.02 1.68 (0.32) (0.46) 0.01 1.22
16 Hewitt Robins International Holdings Ltd GBP 0.00 0.23 - - - - - -
17 YORK Transport Equipment (Asia) Pte Ltd USD - - (0.01) (0.56) (0.82) (1.19) (0.02) (1.75)
18 YORK Transport Equipment Pty Ltd AUD - - (0.00) (0.06) - - (0.00) (0.06)
19 YORK Sales (Thailand) Co. Ltd THB - - (0.00) (0.31) - - (0.00) (0.31)
20 YTE Transport Equipment (SA) (Pty) Limited ZAR - - (0.00) (0.02) - - (0.00) (0.02)
21 Rednet Pte Ltd. USD - - - - - - - -
22 YTE Special Products Pte Ltd USD - - 0.00 0.01 - - 0.00 0.01
23 Qingdao YTE Special Products Co. Ltd CNY - - (0.01) (0.77) - - (0.01) (0.77)
24 YORK Transport Equipment (Shanghai) Co. Ltd CNY - - (0.00) (0.03) - - (0.00) (0.03)
25 PT York Engineering USD - - - - - - - -
FINANCIAL STATEMENTS | 195-418
E. Adjustment due to consolidation (81.60) (56,240.90) 28.83 2,945.80 580.36 838.90 36.52 3,784.70
TOTAL 100.00 68,925.08 100.00 10,218.33 100.00 144.55 100.00 10,362.88
417
418
53. Statement of net assets and profit or loss attributable to owners and non-controlling interests (Contd.)
Reporting Net assets, i.e. total assets Share in profit or (loss) Share in other Share in total
NOTES
Name of the entity currency minus total liabilities comprehensive income comprehensive income
List of subsidiaries, associates and joint ventures which have not been consolidated and reasons for not consolidating
Sl. No. Name Reason
ACS: 15921
Mumbai, April 25, 2019
Notice
Notice is hereby given that the 112th Annual General Meeting of the Director of the Company, be and is hereby appointed as a Director of
Members of Tata Steel Limited will be held on Friday, July 19, 2019, the Company liable to retire by rotation."
at 3.00 p.m. (IST) at the Birla Matushri Sabhagar, 19, Sir Vithaldas
Thackersey Marg, Mumbai 400 020, to transact the following business: Item No. 6 – Re-appointment of Ms. Mallika Srinivasan as an
Independent Director
Ordinary Business: To consider and if thought fit, to pass the following resolution as a
Item No. 1 – Adoption of Audited Standalone Financial Special Resolution:
Statements "RESOLVED THAT pursuant to the provisions of Sections 149, 152
To receive, consider and adopt the Audited Standalone Financial and other applicable provisions, if any, of the Companies Act, 2013
Statements of the Company for the Financial Year ended (‘Act’), the Companies (Appointment and Qualifications of Directors)
March 31, 2019 together with the Reports of the Board of Directors Rules, 2014, read with Schedule IV to the Act and Regulation 17
and the Auditors thereon. and other applicable regulations of the Securities and Exchange
Board of India (Listing Obligations and Disclosure Requirements)
Item No. 2 – Adoption of Audited Consolidated Financial Regulations, 2015 (‘Listing Regulations’), as amended from time
Statements to time, Ms. Mallika Srinivasan (DIN: 00037022), who was appointed
To receive, consider and adopt the Audited Consolidated as an Independent Director at the 107th Annual General Meeting
Financial Statements of the Company for the Financial Year ended of the Company and who holds office up to August 13, 2019 and
March 31, 2019 together with the Report of the Auditors thereon. who is eligible for re-appointment and who meets the criteria for
independence as provided in Section 149(6) of the Act along with the
Item No. 3 – Declaration of Dividend rules framed thereunder and Regulation 16(1)(b) of Listing Regulations
To declare dividend of: and who has submitted a declaration to that effect and in respect of
• `13/- per fully paid Ordinary (equity) Share of face value `10/- each whom the Company has received a Notice in writing from a Member
for the Financial Year 2018-19. under Section 160(1) of the Act proposing her candidature for the
office of Director, be and is hereby re-appointed as an Independent
• `3.25 per partly paid Ordinary (equity) Share of face value `10/-
Director of the Company, based on the recommendations of the
each (paid-up `2.504 per share) for the Financial Year 2018-19.
Nomination and Remuneration Committee, to hold office for a
Item No. 4 – Re-appointment of a Director second term commencing with effect from August 14, 2019 up to
May 20, 2022, not liable to retire by rotation."
To appoint a Director in the place of Mr. Koushik Chatterjee
(DIN:00004989), who retires by rotation in terms of Section 152(6) of Item No. 7 – Re-appointment of Mr. O. P. Bhatt as an
the Companies Act, 2013 and, being eligible, seeks re-appointment. Independent Director
Special Business: To consider and if thought fit, to pass the following resolution as a
Special Resolution:
Item No. 5 – Appointment of Mr. Vijay Kumar Sharma
as a Director "RESOLVED THAT pursuant to the provisions of Sections 149, 152
and other applicable provisions, if any, of the Companies Act, 2013
To consider and if thought fit, to pass the following resolution as an
(‘Act’), the Companies (Appointment and Qualifications of Directors)
Ordinary Resolution:
Rules, 2014, read with Schedule IV to the Act and Regulation 17 and
"RESOLVED THAT Mr. Vijay Kumar Sharma (DIN:02449088), who was other applicable regulations of the Securities and Exchange Board of
appointed by the Board of Directors, based on the recommendation India (Listing Obligations and Disclosure Requirements) Regulations,
of the Nomination and Remuneration Committee, as an Additional 2015 (‘Listing Regulations’), as amended from time to time,
Director of the Company effective August 24, 2018 and who holds Mr. O. P. Bhatt (DIN: 00548091), who was appointed as an Independent
office up to the date of this Annual General Meeting of the Company Director at the 107th Annual General Meeting of the Company
in terms of Section 161 and any other applicable provisions, if any, and who holds office up to August 13, 2019 and who is eligible for
of the Companies Act, 2013 (‘Act’) (including any modification or re-appointment and who meets the criteria for independence as
re-enactment thereof ) and Article 121 of the Articles of Association of provided in Section 149(6) of the Act along with the rules framed
the Company and who is eligible for appointment and has consented thereunder and Regulation 16(1)(b) of Listing Regulations and who
to act as a Director of the Company and in respect of whom the has submitted a declaration to that effect and in respect of whom
Company has received a notice in writing from a Member under the Company has received a Notice in writing from a Member under
Section 160(1) of the Act proposing his candidature for the office of Section 160(1) of the Act proposing his candidature for the office of
419
NOTICE
Director, be and is hereby re-appointed as an Independent Director giving effect to this Resolution and/or otherwise considered by them
of the Company, based on the recommendations of the Nomination to be in the best interest of the Company."
and Remuneration Committee, to hold office for a second term
commencing with effect from August 14, 2019 up to June 9, 2023, not NOTES:
liable to retire by rotation." (a) The Statement, pursuant to Section 102 of the Companies Act,
2013 (‘Act’) with respect to Item Nos. 5 to 9 forms part of this
Item No. 8 – Re-appointment of Mr. T. V. Narendran as Chief Notice. Additional information, pursuant to applicable Regulations
Executive Officer and Managing Director and payment of of the SEBI (Listing Obligations and Disclosures Requirements)
remuneration Regulations, 2015, and Secretarial Standard on General Meetings
To consider and if thought fit, to pass the following resolution as an issued by The Institute of Company Secretaries of India in
Ordinary Resolution: respect of Directors seeking appointment/re-appointment at
this Annual General Meeting (‘Meeting’ or ‘AGM’) is furnished as
"RESOLVED THAT pursuant to the provisions of Sections 196, 197,
annexure to the Notice.
203 and any other applicable provisions, if any, read along with
Schedule V of the Companies Act, 2013 (‘Act’) and the Companies (b) A MEMBER ENTITLED TO ATTEND AND VOTE AT THE ANNUAL
(Appointment and Remuneration of Managerial Personnel) Rules, GENERAL MEETING IS ENTITLED TO APPOINT A PROXY TO
2014, as amended from time to time, the consent of the Members ATTEND AND VOTE AT THE MEETING ON HIS/HER BEHALF.
be and is hereby accorded to the re-appointment and terms of SUCH PROXY NEED NOT BE A MEMBER OF THE COMPANY.
remuneration of Mr. T. V. Narendran (DIN: 03083605) as Chief Executive
(c) Members are requested to note that a person can act as a proxy
Officer and Managing Director (‘CEO & MD’) of the Company for
on behalf of Members not exceeding 50 in number and holding
a period of five years, with effect from September 19, 2018 to
in aggregate not more than 10% of the total share capital of the
September 18, 2023, not liable to retire by rotation, upon the terms
Company carrying voting rights. A Member holding more than
and conditions set out in the Statement annexed to the Notice
10% of the total share capital of the Company carrying voting
convening this Meeting, including the remuneration to be paid in
rights may appoint a single person as proxy and such person
the event of loss or inadequacy of profits in any financial year during
shall not act as proxy for any other person or shareholder.
his said tenure within the overall limits of Section 197 of the Act, as
recommended by the Nomination and Remuneration Committee, (d) The instrument of proxy, in order to be effective, must be received
with liberty to the Board of Directors to alter and vary the terms and at the Registered Office of the Company at Bombay House,
conditions of the said re-appointment and terms of remuneration as 24 Homi Mody Street, Fort, Mumbai 400 001, not less than
it may deem fit and in such manner as may be agreed to between the 48 hours before the commencement of the Meeting. A Proxy
Board and CEO & MD. Form is annexed to this Notice. Proxies submitted on behalf
of limited companies, societies, etc. must be supported by
RESOLVED FURTHER THAT the Board of Directors (the ‘Board’ which
appropriate resolution or authority as applicable.
term includes a duly constituted Committee of the Board) be and is
hereby authorised to take all such steps as may be necessary, proper (e)
Corporate members intending to send their authorized
and expedient to give effect to this Resolution." representatives to attend the Meeting are requested to send
a certified copy of the Board Resolution to the Company,
Item No. 9 – Ratification of Remuneration of Cost Auditors authorising their representative to attend and vote on their
To consider and if thought fit, to pass the following Resolution as an behalf at the meeting.
Ordinary Resolution:
(f )
In case of joint holders attending the Meeting, only such
"RESOLVED THAT pursuant to Section 148 and other applicable joint holders who are higher in the order of the names will be
provisions, if any, of the Companies Act, 2013 read with the Companies entitled to vote.
(Audit and Auditors) Rules, 2014, including any amendment,
(g)
Members/proxies/authorized representatives are requested
modification or variation thereof, the Company hereby ratifies the
to bring the duly filled Attendance Slip enclosed herewith to
remuneration of `20 lakh plus applicable taxes and reimbursement
attend the Meeting.
of out-of-pocket expenses payable to Messrs Shome & Banerjee,
Cost Accountants (Firm Registration Number - 000001) who have (h)
The Register of Members of the Company will be closed
been appointed by the Board of Directors on the recommendation from Saturday, July 6, 2019 to Friday, July 19, 2019 (both days
of the Audit Committee, as the Cost Auditors of the Company, to inclusive) for the purpose of AGM and payment of dividend for
conduct the audit of the cost records maintained by the Company Financial Year 2018-19.
as prescribed under the Companies (Cost Records and Audit) Rules,
(i)
If dividend on both, fully paid Ordinary Shares and partly
2014, as amended, for the Financial Year ending March 31, 2020.
paid Ordinary Shares (collectively, ‘Ordinary Shares’), as
RESOLVED FURTHER THAT the Board of Directors (the ‘Board’ which recommended by the Board of Directors is approved at the
term includes a duly constituted Committee of the Board of Directors) Meeting, payment of such dividend will be made on and from
be and is hereby authorized to do all such acts, deeds, matters and Tuesday, July 23, 2019, as under:
things as may be considered necessary, desirable and expedient for
421
NOTICE
NSDL’s website www.evoting.nsdl.com or the Company’s website Step 2: Cast your vote electronically on NSDL e-Voting system
www.tatasteel.com
Details on Step 1 is mentioned below:
2. The facility for voting through electronic voting system shall be
made available at the Annual General Meeting and the Members How to Log-in to NSDL e-Voting website?
(including proxies) attending the meeting who have not cast 1. Visit the e-Voting website of NSDL. Open web browser by typing
their vote by remote e-voting shall be able to exercise their right the following URL: https://www.evoting.nsdl.com/ either on a
to vote at the Annual General Meeting. Personal Computer or on a mobile.
3. The Members who have cast their vote by remote e-voting prior 2. Once the home page of e-Voting system is launched, click on the
to the Annual General Meeting may also attend the meeting but icon ‘Login’ which is available under ‘Shareholders’ section.
shall not be entitled to cast their vote again.
3. A new screen will open. You will have to enter your User ID, your
4. Members can opt for only one mode of voting, i.e. either by Password and a Verification Code as shown on the screen.
remote e-voting or voting at the Meeting. In case Members cast
Alternatively, if you are registered for NSDL eservices i.e.
their vote through both the modes, voting done by remote
IDEAS, you can log-in at https://eservices.nsdl.com/ with your
e-voting shall prevail and votes cast at the Meeting shall be
existing IDEAS login. Once you log-in to NSDL eservices after
treated as invalid.
using your log-in credentials, click on e-Voting and you can
The instructions for remote e-voting are as under: proceed to Step 2 i.e. Cast your vote electronically.
5. Your password details are given below: open the .pdf file is your 8 digit client ID for NSDL account,
last 8 digits of client ID for CDSL account or folio number for
(a) If you are already registered for e-Voting, then you can use your
shares held in physical form. The .pdf file contains your ‘User
existing password to login and cast your vote.
ID’ and your ‘initial password’.
(b) If you are using NSDL e-Voting system for the first time, you will
(ii) If your email ID is not registered, your ‘initial password’ is
need to retrieve the ‘initial password’ which was communicated
communicated to you on your postal address.
to you. Once you retrieve your ‘initial password’, you need to
enter the ‘initial password’ and the system will force you to 6. If you are unable to retrieve or have not received the ‘Initial
change your password. password’ or have forgotten your password:
(c) How to retrieve your ‘initial password’? (a) Click on ‘Forgot User Details/Password?’ (If you are holding shares
in your demat account with NSDL or CDSL) option available on
(i) If your e-mail ID is registered in your demat account or with
www.evoting.nsdl.com
the Company, your ‘initial password’ is communicated to
you on your email ID. Open the email sent to you by NSDL (b) Click on ‘Physical User Reset Password?’ (If you are holding shares
and open the attachment i.e. a .pdf file. The password to in physical mode) option available on www.evoting.nsdl.com
423
NOTICE
viii. The Scrutinizer shall immediately after the conclusion of voting authorised by the Chairman and the same shall be communicated
at the Annual General Meeting, first count the votes cast at to BSE Limited and National Stock Exchange of India Limited,
the Annual General Meeting, thereafter unblock the votes where the shares of the Company are listed. The results shall
cast through remote e-voting in the presence of at least two also be displayed on the notice board at the Registered Office
witnesses not in the employment of the Company and make, not of the Company.
later than 48 hours of conclusion of the Meeting, a consolidated
xi.
In case of any grievances with respect to the facility for
Scrutinizer’s Report of the total votes cast in favor or against, if
voting by electronic means, Members are requested to
any, to the Chairman or a person authorized by him in writing
contact Mr. Amit Vishal, Senior Manager at [email protected]
who shall countersign the same.
(+91 22 2499 4360) or Ms. Pallavi Mhatre, Manager at
ix. The Chairman or a person authorized by him in writing shall [email protected] (+91 22 2499 4545) or at [email protected]
declare the result of voting forthwith. (1800 222 990) or write to NSDL at NSDL, Trade World, ‘A’ wing,
4th Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower
x. The results declared along with the Scrutinizer’s Report shall be
Parel, Mumbai – 400 013.
placed on the website of the Company www.tatasteel.com and
on the website of NSDL www.evoting.nsdl.com immediately
after the result is declared by the Chairman or any other person
Registered Office:
Bombay House, 24, Homi Mody Street,
Fort, Mumbai - 400 001
Tel: +91 22 6665 8282 Fax: +91 22 6665 7724
CIN: L27100MH1907PLC000260
Website: www.tatasteel.com
Email: [email protected]
Statement pursuant to Section 102(1) of the The Company has received from Mr. Sharma (i) Consent in writing to
Companies Act, 2013, as amended (‘Act’) act as Director in Form DIR-2 pursuant to Rule 8 of the Companies
The following Statement sets out all material facts relating to Item (Appointment and Qualifications of Directors) Rules, 2014;
Nos. 5 to 9 mentioned in the accompanying Notice. (ii) Intimation in Form DIR-8 in terms of the Companies (Appointment
and Qualifications of Directors) Rules, 2014, to the effect that he is
Item No. 5: not disqualified under Section 164(2) of the Act and (iii) Declaration
Based on the recommendation of the Nomination and Remuneration pursuant to BSE Circular No. LIST/COMP/14/2018-19 dated
Committee, the Board of Directors (‘Board’), appointed Mr. Vijay Kumar June 20, 2018, that he has not been debarred from holding office of
Sharma as an Additional (Non-Executive, Non-Independent) Director a Director by virtue of any Order passed by Securities and Exchange
of the Company, effective August 24, 2018. Pursuant to the provisions Board of India or any other such authority.
of Section 161 of the Act and Article 121 of the Articles of Association The profile and specific areas of expertise of Mr. Sharma are provided
of the Company, Mr. Vijay Kumar Sharma will hold office up to the date as annexure to this Notice.
of the ensuing Annual General Meeting (‘AGM’) and is eligible to be
appointed as a Director of the Company. The Company has, in terms of None of the Directors and Key Managerial Personnel of the
Section 160(1) of the Act, received a notice in writing from a Member, Company or their respective relatives, except Mr. Sharma, to whom
proposing the candidature of Mr. Sharma for the office of Director. the resolution relates, is concerned or interested in the Resolution
Mr. Sharma, once appointed will be liable to retire by rotation and will mentioned at Item No. 5 of the Notice.
be subject to the Company’s Policy on Retirement of Directors. The Board recommends the Resolution set forth in Item No. 5 for the
approval of the Members.
The Board on April 25, 2019, based on the recommendations of Item No. 7:
the Nomination and Remuneration Committee and pursuant to Mr. O. P. Bhatt was appointed as a Non-Executive Director of the
the performance evaluation of Ms. Mallika Srinivasan as a Member Company effective June 10, 2013. On April 1, 2014, the Ministry of
of the Board and considering that the continued association of Corporate Affairs notified Section 149 of the Act and related Rules.
Ms. Srinivasan would be beneficial to the Company, proposed Pursuant to this provision, Mr. Bhatt was appointed as an Independent
to re-appoint Ms. Srinivasan as an Independent Director of the Director of the Company by the Shareholders of the Company at the
Company, not liable to retire by rotation, for a second term effective 107th Annual General Meeting held on August 14, 2014, for a period
August 14, 2019 up to May 20, 2022. Further, the Company has, in of five years with effect from August 14, 2014 up to August 13, 2019.
terms of Section 160(1) of the Act, received a notice in writing from
a Member proposing the candidature of Ms. Srinivasan for the The Board on April 25, 2019, based on the recommendations of the
office of Director. Nomination and Remuneration Committee and pursuant to the
performance evaluation of Mr. O. P. Bhatt as a Member of the Board
The Company has received from Ms. Srinivasan (i) Consent in and considering that the continued association of Mr. Bhatt would be
writing to act as Director in Form DIR-2 pursuant to Rule 8 of the beneficial to the Company, proposed to re-appoint Mr. Bhatt as an
Companies (Appointment and Qualifications of Directors) Rules, 2014 Independent Director of the Company, not liable to retire by rotation,
(ii) Intimation in Form DIR-8 in terms of the Companies (Appointment for a second term effective August 14, 2019 up to June 9, 2023.
and Qualifications of Directors) Rules, 2014, to the effect that she is Further, the Company has, in terms of Section 160(1) of the Act,
not disqualified under Section 164(2) of the Act, (iii) Declaration to received a notice in writing from a Member proposing the candidature
the effect that she meets the criteria of independence as provided of Mr. Bhatt for the office of Director.
in Section 149(6) of the Act read with Regulation 16 and Regulation
25(8) of the SEBI (Listing Obligations and Disclosure Requirements) The Company has received from Mr. Bhatt (i) Consent in writing to
Regulations, 2015 as amended (‘Listing Regulations’) and act as Director in Form DIR-2 pursuant to Rule 8 of the Companies
(iv) Declaration pursuant to BSE Circular No. LIST/COMP/14/2018-19 (Appointment and Qualifications of Directors) Rules, 2014
dated June 20, 2018, that she has not been debarred from holding (ii) Intimation in Form DIR-8 in terms of the Companies (Appointment
office of a Director by virtue of any Order passed by Securities and and Qualifications of Directors) Rules, 2014, to the effect that he is
Exchange Board of India or any other such authority. not disqualified under Section 164(2) of the Act (iii) Declaration to
the effect that he meets the criteria of independence as provided
In terms of Section 149, 152 and other applicable provisions of the in Section 149(6) of the Act read with Regulation 16 and Regulation
Act, read with Schedule IV of the Act and the Rules made thereunder, 25(8) of the SEBI (Listing Obligations and Disclosure Requirements)
and in terms of the applicable provisions of the Listing Regulations, Regulations, 2015 as amended (‘Listing Regulations’) and
each as amended, the re-appointment of Ms. Srinivasan as an (iv) Declaration pursuant to BSE Circular No. LIST/COMP/14/2018-19
Independent Director of the Company for a second term commencing dated June 20, 2018, that he has not been debarred from holding
August 14, 2019 through May 20, 2022 is being placed before the office of a Director by virtue of any Order passed by Securities and
Shareholders for their approval by way of a special resolution. Exchange Board of India or any other such authority.
Ms. Srinivasan, once appointed, will not be liable to retire by rotation.
In terms of Section 149, 152 and other applicable provisions of the
In the opinion of the Board, Ms. Srinivasan is a person of integrity, fulfils Act, read with Schedule IV of the Act and the Rules made thereunder,
the conditions specified in the Act and the Rules made thereunder and in terms of the applicable provisions of the Listing Regulations,
read with the provisions of the Listing Regulations, each as amended, each as amended, the re-appointment of Mr. O. P. Bhatt as an
and is independent of the Management of the Company. A copy of Independent Director of the Company for a second term commencing
the draft letter of appointment of Ms. Srinivasan as an Independent August 14, 2019 through June 9, 2023 is being placed before the
Director setting out the terms and conditions is available for inspection Shareholders for their approval by way of a special resolution.
without any fee payable by the Members at the Registered Office of Mr. Bhatt, once appointed, will not be liable to retire by rotation.
the Company during the normal business hours on working days up
to the date of the Annual General Meeting (‘AGM’) and will also be In the opinion of the Board, Mr. Bhatt is a person of integrity, fulfils
kept open at the venue of the AGM till the conclusion of the Meeting. the conditions specified in the Act and the Rules made thereunder
425
NOTICE
read with the provisions of the Listing Regulations, each as amended, Mr. Narendran successfully executed and commissioned one of the
and is independent of the Management of the Company. A copy largest greenfield projects in India, the Kalinganagar Steel Plant in
of the draft letter of appointment of Mr. Bhatt as an Independent Odisha, which achieved its rated capacity within a very short span of
Director setting out the terms and conditions of his appointment is time. It also enhanced the Company’s ability to deliver steel to higher
available for inspection without any fee payable by the Members at value segments such as the automotive and the oil & gas industries.
the Registered Office of the Company during the normal business
In May, 2018, Mr. Narendran oversaw the successful acquisition of
hours on working days up to the date of the Annual General Meeting
Bhushan Steel Limited (renamed Tata Steel BSL Limited).
(‘AGM’) and will also be kept open at the venue of the AGM till the
conclusion of the Meeting. Further, on the recommendations of the Nomination and
Remuneration Committee, the Board at its meeting held on
The profile and specific areas of expertise of Mr. O. P. Bhatt are
April 25, 2019 approved the revision in the terms of remuneration of
provided as annexure to this Notice.
Mr. Narendran, subject to the approval of the Shareholders.
None of the Directors and Key Managerial Personnel of the Company
The main terms and conditions relating to the re-appointment and
or their respective relatives, except Mr. Bhatt, to whom the resolution
terms of remuneration Mr. Narendran as CEO & MD are as follows:
relates, is concerned or interested in the Resolution mentioned at
Item No. 7 of the Notice. (1) Period: For a period of 5 years i.e., from September 19, 2018 to
September 18, 2023.
The Board recommends the Resolution set forth in Item No. 7 for the
approval of the Members. (2) Nature of Duties: The CEO & MD shall devote his whole time
and attention to the business of the Company and perform such
Item No. 8: duties as may be entrusted to him by the Board from time to time
Mr. T. V. Narendran was appointed as the Managing Director of the and separately communicated to him and exercise such powers as
Company for a period of five years effective September 19, 2013 may be assigned to him, subject to superintendence, control and
till September 18, 2018, not liable to retire by rotation, and the said directions of the Board in connection with and in the best interests
appointment was approved by the Shareholders at the 107th Annual of the business of the Company and the business of one or more of
General Meeting held on August 14, 2014. its associated companies and/or subsidiaries including performing
duties as assigned to CEO & MD from time to time by serving on the
The Board of Directors (‘the Board’), on October 31, 2017,
boards of such associated companies and/or subsidiaries or any other
re-designated Mr. Narendran as the Chief Executive Officer and
Executive body or any committee of such a company.
Managing Director of the Company.
(3) A. Remuneration:
Based on the recommendation of the Nomination and Remuneration
Committee, the Board on August 13, 2018, re-appointed a) Basic Salary
Mr. Narendran as the Chief Executive Officer and Managing Director
Current basic salary of `12,50,000/- per month up to a maximum
of the Company, not liable to retire by rotation, for a further period of
of `18,00,000/- per month.
five years effective September 19, 2018 through September 18, 2023,
subject to approval of the Shareholders. The annual increment which will be effective April 1, each year,
will be decided by the Board based on the recommendations
The Board, while re-appointing Mr. Narendran as the Chief Executive
of the Nomination and Remuneration Committee (‘NRC’).
Officer and Managing Director of the Company, considered his
The recommendation of NRC will be based on Company
background, experience and contributions to the Company.
performance and individual performance.
Mr. Narendran joined the Company in 1988 after completing his MBA
from IIM, Calcutta. He has more than 30 years of experience in the b) Benefits, perquisites and allowances
Mining and Metals industry. Details of benefits, perquisites and allowances are as follows:
Mr. Narendran’s career in Tata Steel spanned many areas in India and i. Rent-free residential accommodation (furnished or otherwise)
overseas, including Marketing & Sales, International Trade, Supply the Company bearing the cost of repairs, maintenance,
Chain & Planning, Operations and General Management and includes and utilities (e.g. gas, electricity and water charges) for the
stints at Jamshedpur, Kolkata, Dubai and Singapore. Before becoming said accommodation.
the Managing Director of Tata Steel, Mr. Narendran was the Vice
OR
President - Safety, Flat Products & Long Products since 2010.
House Rent, House Maintenance and Utility Allowances
Mr. Narendran was actively involved in the Company’s first overseas
aggregating 85% of the basic salary.
acquisition, NatSteel, and was seconded there as the Executive Vice
President in 2005. He took over as the President & CEO of NatSteel ii. Hospitalization, transport, telecommunication and other facilities:
from January 2008.
a. Hospitalization and major medical expenses for self,
spouse and dependent parents & children;
427
NOTICE
for any reason whatsoever, he shall cease to be a Director and In accordance with the provisions of Section 148(3) of the Act read
CEO & MD of the Company. with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the
remuneration payable to the Cost Auditors as recommended by the
ix.
The terms and conditions of re-appointment of CEO & MD
Audit Committee and approved by the Board of Directors has to be
also include clauses pertaining to adherence to the Tata
ratified by the Members of the Company. Accordingly, the consent of
Code of Conduct, protection and use of intellectual property,
the Members is sought for passing an Ordinary Resolution as set out
non-competition, non-solicitation post termination of agreement
at Item No. 9 of the Notice for ratification of the remuneration payable
and maintenance of confidentiality.
to the Cost Auditor of the Company for the Financial Year ending
The profile and specific areas of expertise of Mr. Narendran are March 31, 2020.
provided as annexure to this Notice.
None of the Directors and Key Managerial Personnel of the Company
None of the Directors and Key Managerial Personnel of the Company or their respective relatives is concerned or interested in the
or their respective relatives, except Mr. Narendran, to whom the Resolution mentioned at Item No. 9 of the Notice.
resolution relates, is concerned or interested in the Resolution
The Board recommends the Resolution set forth in Item No. 9 for the
mentioned at Item No. 8 of the Notice.
approval of the Members.
In compliance with the provisions of Section 196, 197, 203 and other
By Order of the Board of Directors
applicable provisions of the Act, read with Schedule V to the Act
Sd/-
as amended, and based on the recommendation of the Board and the
Parvatheesam K
NRC, approval of the Members is sought for the re-appointment and
Company Secretary &
terms of remuneration of Mr. T. V. Narendran as Chief Executive Officer Chief Legal Officer (Corporate & Compliance)
and Managing Director as set out above. Mumbai ACS: 15921
The Board recommends the Resolution set forth in Item No. 8 for the April 25, 2019
approval of Members.
Registered Office:
Item No.9: Bombay House, 24, Homi Mody Street,
Fort, Mumbai - 400 001
The Company is required under Section 148 of the Act read with Tel: +91 22 6665 8282
the Companies (Cost Records and Audit) Rules, 2014, as amended Fax: +91 22 6665 7724
from time to time, to have the audit of its cost records for products CIN: L27100MH1907PLC000260
covered under the Companies (Cost Records and Audit) Rules, 2014 Website: www.tatasteel.com
conducted by a Cost Accountant in practice. The Board of Directors Email: [email protected]
of the Company has on the recommendation of the Audit Committee
approved the appointment and remuneration of Messrs Shome &
Banerjee, Cost Accountants (Firm Registration Number - 000001) as
the Cost Auditor of the Company for the Financial Year 2019-20.
Profile of Mr. Koushik Chatterjee tenure at Tata Sons and Tata Steel. Mr. Chatterjee brings to the
Mr. Koushik Chatterjee (50) is an Board extensive experience in the areas of controllership, financial
Honors Graduate in Commerce stewardship, business responsibility (including re-structuring and
from Calcutta University and a turnaround of large organisations), business development (mergers,
Fellow Member of the Institute of acquisitions and divestments), strategy and execution of large and
Chartered Accountants of India. complex financing, strategic communication, risk management, crisis
leadership, public affairs, legal, compliance and governance.
Mr. Chatterjee joined Tata Steel
Limited in 1995 in Jamshedpur. Mr. Chatterjee’s experience demonstrates his leadership capability,
He was then transferred to general business acumen and knowledge of complex financial
Tata Sons in 1999 in the Group operational and governance issues that large corporations face.
Executive Office. He re-joined By virtue of his background and experience Mr. Chatterjee has an
Tata Steel Limited on August 1, extraordinarily broad and deep knowledge of the steel and mining
2003 and was appointed as the industry. His experiences will enable him to provide the Board with
Group CFO in 2008. He was inducted on the Board of Tata Steel valuable insights on a broad range of business, social and governance
Limited effective November 9, 2012. Further he was appointed as issues that are relevant to the Company.
Group Executive Director (Finance & Corporate), Tata Steel in 2013
Board Meeting Attendance and Remuneration
and re-appointed as Whole Time Director effective November 9, 2017
designated as Executive Director and Chief Financial Officer. During the year, Mr. Chatterjee attended all seven Board Meetings that
were held. Being an Executive Director, Mr. Chatterjee was not paid
During the last 15 years in the Company, he has been part of the any sitting fees for attending the Meetings of the Board/Committees.
top leadership team in the Company and has led the Company’s Details regarding the remuneration is provided in the Corporate
finance function and provided stewardship in the areas of financial Governance Report forming part of the Board's Report.
strategy, performance management, large and complex financing in
India and overseas of over USD 70 billion across several instruments Bodies Corporate (other than Tata Steel Limited) in which
and currencies, mergers and acquisitions including divestments, Mr. Koushik Chatterjee holds Directorships and Committee
risk management, reporting and controlling, investor relations positions
and taxation. He has also been deeply involved in portfolio
Directorships
restructuring and turnaround of business situations of various
Subsidiary Companies. Tata Metaliks Limited
The Tinplate Company of India Limited
Mr. Chatterjee had been a member of the Primary Market Advisory Tata Sponge Iron Limited
Committee of the SEBI and was member of the task force set up by Tata Steel BSL Limited (formerly Bhushan Steel Limited)
SEBI that drafted the Takeover Code. He was also the member of Tata Steel Europe Limited
the Global Preparers Forum, the advisory body to the International TS Global Holdings Pte Ltd
Accounting Standards Board London. He is currently the member of TS Global Minerals Holdings Pte Ltd., Singapore
International Integrated Reporting Council UK, Working Group on TS Global Procurement Co. Pte. Ltd., Singapore
Group Insolvency set up by the Insolvency and Bankruptcy Board Dimna Steel Limited
of India, Global Task Force on Climate Related Financial Disclosures Bistupur Steel Limited
set up by the Financial Stability Board, Basel Switzerland. He is a Tata Steel Foundation (Section 8 Company)
frequent speaker in various conferences in India and abroad and has World Steel Association
been recognised as one of India’s best CFO by several organisations
Chairperson of Board Committees
like Business Today Magazine, CNBC, Asiamoney, Chartered Institute
of Management Accountants UK. Recently in March 2019, he was Tata Steel BSL Limited
honoured with the ’FE CFO Lifetime Achievement Award’ by the Stakeholders' Relationship Committee
Financial Express.
Member of Board Committees
Particulars of experience, attributes or skills that qualify
Tata Steel Europe Limited
Mr. Chatterjee for Board membership:
Audit Committee
Mr. Koushik Chatterjee has valuable experience in managing the Executive Committee
issues faced by large and complex corporations by virtue of his Board Pension Committee
429
NOTICE
The Tinplate Company of India Limited Profile of Mr. Vijay Kumar Sharma
Nomination & Remuneration Committee Mr. Vijay Kumar Sharma (60) was
appointed as a Member of the
Tata Metaliks Limited
Board effective August 24, 2018.
Nomination & Remuneration Committee
Mr. Sharma is the former
Tata Steel BSL Limited Chairman of Life Insurance
Audit Committee Corporation of India (‘LIC’),
a position he held till
Tata Sponge Iron Limited
December 31, 2018. Prior to him
Audit Committee
taking over as Chairman of LIC on
Nomination & Remuneration Committee
December 16, 2016, he served
Committee of Board
as Chairman (In-charge) from
Disclosure of Relationship inter-se between Directors, September 16, 2016 and
Manager and other Key Managerial Personnel Managing Director, LIC from November 1, 2013. From December 2010
to November 2013, he served as Managing Director & Chief Executive
There is no inter-se relationship between Mr. Koushik Chatterjee, other
Officer, LIC Housing Finance Limited (‘LICHFL’), a premier housing
members of the Board and Key Managerial Personnel of the Company.
finance company in the country.
Shareholding in the Company Mr. Sharma joined LIC as a Direct Recruit Officer in 1981 and in an
Mr. Koushik Chatterjee holds 1,531 Fully Paid Equity Shares and 105 illustrious career spanning 37 years, served in several pivotal positions
Partly Paid Equity Shares of the Company. in LIC. Mr. Sharma has steered LIC in challenging assignments, pan
India, which has added immensely to his experience and honed his
understanding of demographics of the country, socio-economic needs
of different regions and multi-cultural challenges in implementation
of objectives of large Corporates.
As the Managing Director & Chief Executive Officer of LICHFL,
he stabilised the operations of the Company under challenging
circumstances and turned it around to be the best housing finance
company in 2011.
Mr. Sharma holds a post-graduate degree (MSc.) in Botany from
University of Patna.
431
NOTICE
Bodies Corporate (other than Tata Steel Limited) in which He was then appointed as an
Ms. Mallika Srinivasan holds Directorships and Committee Independent Director of the
positions Company, under the Companies
Act, 2013, by the Shareholders
Directorships of the Company at the 107th
TAFE Motors and Tractors Limited Annual General Meeting held on
Tractors and Farm Equipment Limited August 14, 2014, for a period of five
TAFE Access Limited years with effect from August 14,
TAFE Reach Limited 2014 up to August 13, 2019.
The United Nilgiri Tea Estate Company Limited
Prior to joining Tata Steel as a Director, Mr. Bhatt has served as the
Tata Global Beverages Limited
Chairman of State Bank Group from June 2006 to March 2011,
TAFE Properties Limited
which includes the State Bank of India (‘SBI’), five associate banks
Trust Properties Development Company Private Limited
in India, five overseas banks, SBI Life, SBI Capital Markets, SBI Fund
AGCO Corporation, USA
Management and other subsidiaries spanning diverse activities from
Chennai Willington Corporate Foundation
general insurance to custodial services.
Indian School of Business
Harita Realty Developers LLP He has served as Chairman of the Indian Banks’ Association, the
apex body of Indian banks and was the government’s nominee on
Chairperson of Board Committees the India-US CEO Forum, Indo-French CEO Forum and Indo-Russia
TAFE Motors and Tractors Limited CEO Forum. He has also served as a Governor on the Board of Centre
Corporate Social Responsibility Committee for Creative Leadership, USA and was nominated ‘Banker of the
Year’ by Business Standard and ‘Indian of the Year for Business’ in
The United Nilgiri Tea Estates Company Limited 2007 by CNN-IBN.
Corporate Social Responsibility Committee
Mr. O. P. Bhatt is a graduate in Science and a post graduate in English
Tractors and Farm Equipment Limited Literature (Gold Medalist) from University of Meerut.
Corporate Social Responsibility Committee
Particulars of experience, attributes or skills that qualify
Member of Board Committees Mr. Bhatt for Board membership:
Mr. Bhatt is a successful international leader with a career spanning
TAFE Motors and Tractors Limited
4 decades. He has served in several pivotal positions during his tenure
Nomination and Remuneration Committee
in SBI. As the Chairman of SBI, he has transformed SBI in bringing
The United Nilgiri Tea Estates Company Limited efficiency and competitiveness in operations. It is under his stewardship
Nomination and Remuneration Committee that SBI adopted an aggressive strategy in marketing and operations
and rose on the global list rankings of Fortune 500 companies.
Tractors and Farm Equipment Limited
Mr. Bhatt brings with him deep knowledge in Banking, Financial and
Nomination and Remuneration Committee
Manufacturing sectors and has a proven track record in managing
Disclosure of Relationship inter-se between Directors, complex organisation structures. Mr. Bhatt occupies himself primarily
Manager and other Key Managerial Personnel with Board in a range of global manufacturing and technology
companies such as Tata Motors Limited and Tata Consultancy Services
There is no inter-se relationship between Ms. Mallika Srinivasan, other
Limited amongst others. His prior experience enables him to provide
members of the Board and Key Managerial Personnel of the Company.
the Board with valuable insights on a broad range of business, social
Shareholding in the Company and governance issues that are relevant to large corporations.
Ms. Mallika Srinivasan does not hold any Equity Shares of With the above exceptionally distinguished record of
the Company. accomplishments, Mr. Bhatt will continue to add significant value and
strength to the Board.
433
NOTICE
As the Chief Executive Officer and Managing Director, Chairperson of Board Committees
Mr. Narendran is responsible for the business and corporate affairs of
Tata Steel BSL Limited
Tata Steel globally. He provides broad insights to the understanding
of complex strategic, operational, and financial matters of the Corporate Social Responsibility & Sustainable Committee
Industry as well as the Company. Capex Committee
Safety, Health and Environment Committee
Also, as a Key Managerial Personnel, Mr. Narendran provides the Board
with an ‘‘insider’s view’’ of all facets of the Company. His perspective Tata Sponge Iron Limited
provides the Board with important information necessary to oversee Committee of Board
the business and affairs of the Company.
Member of Board Committees
His ability to manage different stakeholders, build consensus around
divergent issues, and lead the executive team effectively is invaluable Tata Steel Europe Limited
to the Company. Mr. Narendran exhibits high levels of loyalty, Remuneration Committee
commitment, and integrity towards the Company. The Company will Audit Committee
be best served by his re-appointment as the Chief Executive Officer
Tata Steel BSL Limited
and Managing Director.
Nomination and Remuneration Committee
Board Meeting Attendance and Remuneration
Tata Sponge Iron Limited
During the year, Mr. Narendran attended all seven Board Meetings Nomination and Remuneration Committee
held. Being an Executive Director, Mr. Narendran was not paid any
sitting fees for attending the meetings of the Board/Committees. Disclosure of Relationship inter-se between Directors,
Details regarding the remuneration is provided in the Corporate Manager and other Key Managerial Personnel
Governance Report forming part of the Board's Report. There is no inter-se relationship between Mr. T. V. Narendran, other
members of the Board and Key Managerial Personnel of the Company.
Bodies Corporate (other than Tata Steel Limited) in which
Mr. T. V. Narendran holds Directorships and Committee Shareholding in the Company
positions
Mr. Narendran along with his relative holds 2,032 Fully Paid Equity
Directorships Shares and 139 Partly Paid Equity Shares of the Company.
Tata Steel Europe Limited
Tata Steel BSL Limited (formerly Bhushan Steel Limited)
Tata Sponge Iron Limited
Jugsalai Steel Limited
Straight Mile Steel Limited
Sakchi Steel Limited
Noamundi Steel Limited
Tata Steel Foundation (Section 8 Company)
435
To,
TSR Darashaw Limited/Depository Participant
______________________________________
______________________________________
______________________________________
Bank Details:
IFSC:
(11 digit)
MICR:
(9 digit)
Bank A/c Type:
Bank A/c No.: *
I/We hereby declare that the particulars given above are correct and complete. If the transaction is delayed because of
incomplete or incorrect information, I/We would not hold the Company/RTA responsible. I/We undertake to inform any subsequent
changes in the above particulars as and when the changes take place. I/We understand that the above details shall be maintained till
I/We hold the securities under the above mentioned Folio No.
Place:
Date:
_________________________
Signature of Sole/First holder
Note:
Shareholders holding shares in physical mode and having Folio No(s) should provide the above information to our RTA,
TSR Darashaw Limited. Shareholders holding Demat shares are required to update their details with the Depositary Participant.
437
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INTEGRATED REPORT & ANNUAL ACCOUNTS 2015-16 | 109TH YEAR
Tata Steel Limited
Registered Office: Bombay House, 24, Homi Mody Street, Fort, Mumbai - 400 001.
Tel.: +91 22 6665 8282 • Fax: +91 22 6665 7724 • Corporate Identity No.: (CIN) – L27100MH1907PLC000260
Website: www.tatasteel.com • Email: [email protected]
Attendance Slip
(To be presented at the entrance)
112TH ANNUAL GENERAL MEETING ON FRIDAY, JULY 19, 2019, AT 3.00 P.M. (IST)
at Birla Matushri Sabhagar,19, Sir Vithaldas Thackersey Marg, Mumbai - 400 020.
Proxy Form
(Pursuant to Section 105(6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration) Rules, 2014, as amended)
Name of the Member(s) :
Registered address :
E-mail Id :
Folio No./Client ID No. DP ID No.
I/We, being the Member(s) holding Equity Shares of Tata Steel Limited, hereby appoint
1. Name: E-mail Id:
Address:
Signature: or failing him
2. Name: E-mail Id:
Address:
Signature: or failing him
3. Name: E-mail Id:
Address:
Signature:
as my/our Proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 112th Annual General Meeting of the Company to be held
on Friday, July 19, 2019, at 3.00 p.m. IST at Birla Matushri Sabhagar, 19, Sir Vithaldas Thackersey Marg, Mumbai-400 020 and at any adjournment
thereof in respect of such Resolutions as are indicated below:
** I wish my above Proxy to vote in the manner as indicated in the box below:
Resolution
Resolution For Against
No.
Ordinary Business
Consider and adopt the Audited Standalone Financial Statements for the
1 Financial Year ended March 31, 2019 and the Reports of the Board of Directors
and Auditors thereon.
439
NOTICE
Resolution
Resolution For Against
No.
Ordinary Business
Consider and adopt the Audited Consolidated Financial Statements for the
2
Financial Year ended March 31, 2019 and the Report of the Auditors thereon.
Declaration of Dividend on fully paid and partly paid Ordinary Shares for Financial
3
Year 2018-19.
Appointment of Director in place of Mr. Koushik Chatterjee (DIN:00004989), who
4
retires by rotation and being eligible, seeks re-appointment.
Special Business
5 Appointment of Mr. Vijay Kumar Sharma (DIN: 02449088) as a Director.
Re-Appointment of Ms. Mallika Srinivasan (DIN: 00037022) as an Independent
6
Director.
7 Re-Appointment of Mr. O. P. Bhatt (DIN: 00548091) as an Independent Director.
Re-Appointment of Mr. T. V. Narendran (DIN: 03083605) as Chief Executive Officer
8
and Managing Director and payment of remuneration.
Ratification of the remuneration of Messrs Shome & Banerjee, Cost Auditors of the
9
Company.
Affix
Signed this day of 2019 Revenue
Stamp
NOTES:
1. This Form of Proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company at Bombay
House, 24, Homi Mody Street, Fort, Mumbai-400 001 not less than 48 hours before the commencement of the Meeting.
** 2. This is only optional. Please put a ‘√’ in the appropriate column against the Resolutions indicated in the Box. If you leave the ‘For’ or
‘Against’ column blank against any or all the Resolutions, your Proxy will be entitled to vote in the manner as he/she thinks appropriate.
3. Appointing Proxy does not prevent a Member from attending in person if he/she so wishes.
4. In case of joint holders, the signature of any one holder will be sufficient, but names of all the joint holders should be stated.
The city, originally called Sakchi, was renamed as ‘Jamshedpur’ by Lord Chelmsford (Viceroy of India between 1916-21)
on January 2, 1919 in the honour of Jamsetji Nusserwanji Tata, founder of the Tata group.
Tata Steel Limited
Bombay House, 24 Homi Mody Street, Fort, Mumbai - 400 001
www.tatasteel.com
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