The Directors have pleasure in presenting the Fifty-First Annual Report on the business and operations of the Company together with the Audited Financial Statements for the Financial Year ended March 31, 2024.

1. Financial Highlights (on standalone basis)

( ' in Million)

2. Dividend

Based on the Company's performance, the Directors are pleased to recommend a dividend of ? 10/- per Equity Share of ? 5/- each (i.e. 200%), for the financial year ended March 31, 2024, for approval of the members.

The Board has recommended dividend based on the parameters laid down in the Dividend Distribution Policy, adopted by the Company pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The dividend on Equity Shares, if approved by the members would involve cash outflow of ? 436.53 Million and shall be subject to deduction of income tax at source.

3. Reserves

During the year under review, the Company does not propose to transfer any amount to the General Reserve. An amount of ? 16,198 Million is proposed to be retained as Retained Earnings.

4. Performance of the Company

The spill-over effects, negative global headwinds continue to impact steel industry even in FY 2023-24. These headwinds coupled with fluctuations in China's steel output created volatility in both raw material prices as well as Steel prices. Further, inflationary pressures in major economies forced central banks to increase the interest rates which increased the cost of capital.

Iron ore and Coking coal, the key commodities for steel industry exhibited volatile prices throughout the year between $ 105/ton to $ 136/ton and $ 231/ton to $ 354/ton respectively. Such price volatility in commodity prices puts negative pressure on the profitability of the Company. The Company commissioned its Coke Oven plant last year which helped to reduce the impact of such volatility to some extent. Despite such a volatile & complex business environment, the Company has delivered extremely well results during FY 2023-24. The Company achieved Total Income of ? 20,063 Million as against ? 19,558 Million in FY 2022-23. The Profit before tax is ? 3,327 Million against ? 2,251 Million in FY 2022-23.

The automotive sector is a key contributor to the Company's business portfolio. FY 2023-24 has seen consecutive remarkable growth in passenger vehicles (PV) sales at 4.89 Million vehicles at a growth of 9% over FY 2022-23. With 4.89 Million vehicles sales, PV has surpassed its previous best of 4.5 Million vehicles in FY 2022-23. Two Wheelers & Three Wheelers are yet to catch up with the pre-pandemic numbers but have exhibited growth. Commercial vehicles sale has seen a decline of 1% to reach 1 Million vehicles in FY 2024. After consecutive sharp growth in Auto sector, a moderate growth is expected in coming years. On the other hand, increased demand is expected from sunrise sectors such as Renewable Energy, Hydrogen electrolyzer & storage solutions, H2 fuel cells, sustainable heating solutions etc. where specialty alloys steel products would be used. The Company is continuously investing in R&D to develop new steel grades suitable for a variety of applications catering to these segments. This would also help the Company to increase its profitability in the near future.

5. Acquisition of Assets of Kamineni Steel & Power India Private Limited (In Liquidation)

During the year under review, the Company acquired the assets of Kamineni Steel & Power India Private Limited, a Company under liquidation, pursuant to the invitation for Sale of Assets through e-auction platform, under Insolvency and Bankruptcy Code, 2016. The assets include Land, Building and Plant and Machinery of Steel Billet Plant including vehicles and the Company paid cash consideration of ' 5,047.20 Million (including applicable taxes) for acquisition of the said assets.

6. Memorandum of Understanding with Government of Odisha

The Company is pleased to inform the members that the Company has signed a Memorandum of Understanding (MoU) with the Government of Odisha on February 23, 2024, expressing an intent to setup :

a) 0.7 MTPA Integrated Advanced Specialty Steel & Automotive Components Manufacturing Complex and;

b) Phase 1 of Integrated Titanium Metal / Alloy and Aerospace & Defense Components Manufacturing Plant of

10,000 TPA capacity, in the State of Odisha.

Both the Company and the Government of Odisha agreed that the detailed terms and conditions for the implementation of the MoU shall be drawn up subsequently. Any updates thereon shall be provided by the Company in due course.

7. State of Company's Affairs

Discussion on the state of Company's affairs has been covered as part of the Management Discussion and Analysis (MD&A). MD&A for the year under review, as stipulated under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is presented in a separate section forming part of the Annual Report.

8. Corporate Governance

Your Company is committed to adopt the best standards of Corporate Governance and adheres to the Corporate Governance requirements set out by the SEBI.

The Report on Corporate Governance as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is presented in a separate section forming part of the Annual Report.

The requisite certificate from Secretarial Auditors of the Company viz. M/s. SVD & Associates, Practicing Company Secretaries, Pune certifying compliance of the conditions of Corporate Governance is attached to Report on Corporate Governance.

9. Deposits

During the year under review, the Company has not accepted any deposit under Chapter V of the Companies Act, 2013.

10. Directors

The Board of Directors at their meeting held on February 5, 2024, had co-opted Mr.S.G. Joglekar, as an Additional Independent Director, for the term of 5 (Five) consecutive years with effect from February 5, 2024 to February 4, 2029, subject to approval of the members. The Company had obtained the approval of members by way of Postal Ballot and Special Resolution approving his appointment was passed on March 16, 2024.

Mr.B.B. Hattarki, Independent Director of the Company, completed his Second Term of 5 (Five) years on March 31, 2024 and accordingly ceased to be the Director of the Company with effect from April 1, 2024. The Board places on record its sincere appreciation of the contribution made by Mr.Hattarki during tenure as a Director of the Company.

Mrs.Shruti A. Shah, Independent Director of the Company is seeking re-appointment for a Second Term of 5 (Five) consecutive years with effect from January 29, 2025 to January 28, 2030.

In terms of the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr.B.N. Kalyani and Mr.M.U. Takale, Directors of the Company, are retiring by rotation at the ensuing Annual General Meeting and being eligible, have offered themselves for re-appointment.

These re-appointments forms part of the Notice of the Fifty-First Annual General Meeting and the Resolutions are recommended for your approval. Profiles of these Directors are given in the Report on Corporate Governance for reference of the members.

The Company has received declarations from all Independent Directors that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

10.1 Board Evaluation

Led by Nomination and Remuneration Committee, the Board evaluated the effectiveness of its functioning, the performance of its committees, the Chairman, Independent Directors, Non-Executive Directors and Executive Directors.

The criteria for performance evaluation of the Board included deciding on long term strategy planning, structure, composition and role clarity of the Board and Committees, discharging of governance and fiduciary duties, handling critical issues etc.

The criteria for performance evaluation of the Committees included composition and role of the Committees, ideas shared by the Directors in Committee Meetings, their attendance, extent of co-ordination and cohesiveness between the Board and its Committees, to name a few.

The criteria for performance evaluation of the Directors included contributions made by the Directors at the Board / Committee meetings, attendance, instances of sharing best practices, contributions in long-term strategic planning, domain knowledge, vision, strategy, engagement with senior management etc. In a separate meeting, the Independent Directors evaluated the performance of Non-Independent Directors including the Managing Director and also reviewed the performance of the Board as a whole including the Chairman of the Board. They also assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

10.2 Nomination & Remuneration Policy

The Nomination and Remuneration Policy of the Company, inter alia, provides that the Nomination and Remuneration Committee shall formulate the criteria for appointment of Directors on the Board of the Company and persons holding Senior Management positions in the Company, including their remuneration and other matters as provided under Section 178 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy is available on the website of the Company. (Web-link : http://www.kalyanisteels.com/profile/policies/).

10.3 Meetings of the Board

During the Financial Year 2023-24, five Board Meetings were convened and held. Also a separate meeting of Independent Directors as prescribed under Schedule IV of the Companies Act, 2013 was held. The details of meetings of Board of Directors are available in the Report on Corporate Governance which forms part of this Annual Report.

11. Directors' Responsibility Statement

Pursuant to the requirements under Section 134(5) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, it is hereby confirmed that :

i) in the preparation of the annual accounts for the year ended March 31, 2024, the applicable accounting standards have been followed and that there are no material departures;

ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2024 and of the profit of the Company for that period;

iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) the Directors have prepared the annual accounts for the year ended March 31, 2024, on a going concern basis;

v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

vi) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

12. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is enclosed herewith as Annexure "A".

13. Corporate Social Responsibility

The Company has been carrying out various Corporate Social Responsibility (CSR) activities in the areas of education. These activities are carried out in terms of Section 135 read with Schedule VII of the Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014.

The Annual Report on CSR Activities undertaken by the Company is enclosed herewith as Annexure "B" The CSR Policy is available on the Company's website viz. www.kalyanisteels.com/profile/policies/

14. Related Party Transactions

In line with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated a Policy on Related Party Transactions and the same can accessed on the Company's website viz. www.kalyanisteels.com/profile/policies/

During the year under review, all related party transactions were placed before the Audit Committee for prior approval and were at arm's length and in the ordinary course of business and in accordance with the related party framework formulated and adopted by the Company.

Pursuant to Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of transactions with related parties, are provided in Form AOC-2, which is enclosed herewith as Annexure "C". Details of related party transactions entered into by the Company, in terms of Ind AS 24 have been disclosed in Note No.38 to the Standalone Financial Statements.

15. Risk Management

Risk management is the continuing process to identify, analyze, evaluate, and minimize loss exposures and monitor risk control and financial resources to mitigate the adverse effects of loss. It is seen that organizations that embrace strategic risk management are more likely to deliver stakeholder confidence and better business outcomes.

The Risk Management Policy of the Company, which is approved by the Risk Management Committee of the Board and the Board of Directors, provides the framework of Enterprise Risk Management by describing mechanisms for the proactive identification and prioritization of risks based on the scanning of the external environment and continuous monitoring of internal risk factors. The Risk Management Committee which oversees the risk management process in the Company, is chaired by an Independent Director of the Company. The Audit Committee also has additional responsibility to monitor risks in the area of financial risks and controls.

The policy on Risk Management as approved by the Board is uploaded on the Company's website at the Web-link : http://www.kalyanisteels.com/profile/policies/

16. Audit Committee

As on March 31, 2024, the Audit Committee comprises of Mr.S.K. Adivarekar, Chairman of the Committee and Independent Director, Mr.B.N. Kalyani, Promoter Non-Executive Director, Mr.B.B. Hattarki and Mrs.Shruti A. Shah, Independent Directors.

In view of completion of second term of Mr.B.B. Hattarki, Independent Director on March 31, 2024, the Board of Directors in its meeting dated February 5, 2024, reconstituted the Audit Committee with effect from April 1, 2024 to include Mr.S.G. Joglekar, Independent Director in the place of Mr.B.B. Hattarki.

All the recommendations made by the Audit Committee were deliberated and accepted by the Board during the Financial Year 2023-24.

17. Auditors and Auditor's Report

M/s. Kirtane & Pandit LLP, Chartered Accountants, Pune (Firm Registration No.105215W / W100057), are the Auditors of the Company and they hold office till the conclusion of the Fifty-Fourth Annual General Meeting to be held in the year 2027.

The Notes on Financial Statements referred to in the Auditor's Report are self-explanatory and hence do not call for any further comments. The Auditor's Report does not contain any qualification, reservation, adverse remark or disclaimer.

During the year under review, the Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013 to the Audit Committee.

18. Cost Auditors

The Board of Directors, on the recommendation of the Audit Committee, has appointed M/s S.R. Bhargave & Co., Cost Accountants, Pune for conducting the cost audit of the Company for Financial Year 2024-25.

As required under the Companies Act, 2013, the remuneration payable to the Cost Auditors is required to be ratified by the members of the Company. Accordingly, resolution seeking members ratification for remuneration to be paid to Cost Auditors is included at Item No.6 of the Notice convening Annual General Meeting.

19. Secretarial Audit and Secretarial Standards

Pursuant to provisions of Section 204 of the Companies Act, 2013, the Board had appointed M/s. SVD & Associates, Practicing Company Secretaries, Pune, to undertake Secretarial Audit of the Company for the Financial Year 2023-24. The Secretarial Audit Report for the Financial Year ended March 31, 2024, is annexed herewith as Annexure "D" The Secretarial Audit Report does not contain any qualification, reservation, adverse remark or disclaimer.

The Company is compliant with the Secretarial Standards issued by the Institute of Company Secretaries of India and approved by Central Government under Section 118(10) of the Companies Act, 2013.

20. Information pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

The information required 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, has been provided in Annexure "E".

In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the shareholders excluding the information required under Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Any shareholder interested in obtaining the same may write to the Company Secretary at investor@kalyanisteels.com

21. Annual Return

In accordance with Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the Annual Return of the Company as on March 31, 2023, filed with Registrar of Companies, is available on the Website of the Company at www.kalyanisteels.com

22. Whistle Blower Policy

The Company believes in conduct of its affairs in a fair and transparent manner by adopting highest standards of professionalism, integrity and ethical behavior and ensures adherence of these principles across the organization.

The Company has a robust vigil mechanism through its Whistle Blower Policy, approved and adopted by the Board of Directors of the Company in compliance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Whistle Blower Policy is available on the Company's website at the Web-link : www.kalyanisteels.com/profile/policies/

The mechanism provides a formal channel whereby the employees / directors can report the instances of unethical behavior, actual or suspected fraud or any violation of the Code of Conduct and / or laws applicable to the Company, report the instances of leakage of unpublished price sensitive information and seek redressal. This mechanism provides appropriate protection to the genuine Whistle Blower, who avails of the mechanism. During the year under review, the Company has not received any complaint under the said mechanism.

23. Particulars of Loans, Guarantees or Investments

Particulars of Loans, Guarantees and Investments covered under Section 186 of the Companies Act, 2013, forms part of the notes to the Financial Statements provided in this Annual Report.

24. Internal Financial Controls

Your Company has in place adequate internal financial controls with reference to the Financial Statements. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial information; complying with applicable statutes; safeguarding assets from unauthorized use; ensuring that transactions are carried out with adequate authorization and complying with Corporate Policies and Processes. Such controls have been assessed during the year, after taking into consideration the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by The Institute of Chartered Accountants of India.

25. Material Changes and Commitments, if any, affecting Financial Position of the Company

There are no adverse material changes or commitments that occurred after March 31, 2024, which may affect the financial position of the Company or may require disclosure.

26. Significant and Material Orders

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.

27. Familiarization Programme

The Company believes that well informed / familiarized Board can contribute significantly towards effectively discharging its role of trusteeship in a manner that fulfils stakeholders aspirations. In pursuit of this, the Directors of the Company are updated on material changes / developments in the industry scenario including those pertaining to statutes / legislation & economic environment and on matters significantly affecting the Company, to enable them to take well informed and timely decisions. The Directors are also updated on all business related matters including risk assessment & minimization procedures, new initiatives proposed by the Company.

Detailed presentations are made to the entire Board including independent Directors from time to time on various matters such as the Company's operations and business plans, strategic plans, plant operations, regulatory updates etc. The Functional heads are invited from time to time to present before the Board, key matters pertaining to their area of expertise.

Additionally, plant visits are organized for the new as well as existing Directors to enable them to understand the business better.

The details of programmes for familiarization of Independent Directors with the Company are put up on Website of the Company. (Web-link : http://www.kalyanisteels.com/profile/policies/)

28. Subsidiaries, Joint Ventures or Associate Companies

As on March 31, 2024, the Company has one Subsidiary, one Associate Company and one Joint Venture Company. A statement containing the salient features of the financial statement of the subsidiary, associate and joint venture in the prescribed format AOC - 1 is annexed hereto as Annexure "F".

The Policy for determining 'Material' subsidiaries has been displayed on the Company's website viz. www.kalyanisteels.com/profile/policies/

29. Business Responsibility and Sustainability Report

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility and Sustainability Report (BRSR) forms a part of this Annual Report describing the initiatives taken by the Company on Environment, Social and Governance (ESG) parameters during the year 2023-24, as annexed hereto as Annexure "G"

30. Transfer to Investor Education and Protection Fund (IEPF)

Pursuant to provisions of the Companies Act, 2013, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF Rules) the declared dividends, which are unpaid or unclaimed for a period of 7 (seven) years and the shares thereof, shall be transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government. The shareholders have an option to claim the amount of the dividend transferred and / or shares from IEPF. No claim shall be entertained against the Company for the dividend amounts and shares so transferred.

During the year, no unpaid or unclaimed dividend and the shares thereof were liable to be transferred to IEPF.

31. Obligation of Company under The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has zero tolerance for sexual harassment of women at workplace and has adopted a Policy for prevention, prohibition and redressal of sexual harassment at workplace, in terms of provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act) and the rules framed thereunder. All women employees (permanent, temporary, contractual and trainees), as well as any women visiting the Company's office premises are covered under the Policy.

The Company has constituted an Internal Complaints Committee under the POSH Act. During the year under review, no complaints were received by the Committee.

32. Acknowledgement

The Directors wish to convey their deep appreciation for the support and co-operation received from the Central Government, the Government of Maharashtra, the Government of Karnataka, the Government of Odisha, Karnataka Industrial Area Development Board, various State Governments in India, Financial Institutions and the Bankers.

The Directors appreciate and value the contribution made by all employees at all levels, resulting in the successful performance of the Company during the year.

The Directors also take this opportunity to express their deep gratitude for the continued co-operation and support received from its valued shareholders.

The Directors express their special thanks to Mr.B.N. Kalyani, Chairman of the Company, for his persistent actions for the progress of the Company.

for and on behalf of the Board of Directors

Place : Pune B.N. Kalyani

Date : May 10, 2024 Chairman