3.9 Provisions, contingent liabilities, commitments and contingent assets

Provisions are recognized for present obligations of uncertain timing or amount arising as a result of a past event where a reliable estimate can be made and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation.

Where it is not probable that an outflow of resources embodying economic benefits will be required or the amount cannot be estimated reliably, the obligation is disclosed as a

contingent liability and commitments, unless the probability of outflow of resources embodying economic benefits is remote. Contingent assets are not recognized but disclosed in the financial statements when an inflow of economic benefits is probable.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

3.10 Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

• Initial Recognition

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition. Trade Receivables are initially recognised at transaction price where that do not contain any significant portion of financing component. Transaction costs that are directly attributable to the acquisition or release of financial assets and financial liabilities respectively, which are not at fair value through profit or loss, are added to the fair value of underlying financial assets and liabilities on initial recognition. Trade receivables and trade payables that do not contain a significant financing component are initially measured at their transaction price.

• Subsequent Measurement

a. Non- Derivative Financial Instruments

Ý Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost which is held with objective to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Ý Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income which is held with objective to achieve both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The Company has made an election for its investments which are classified as equity instruments (other than

Ý Financial liabilities

Financial liabilities are subsequently carried at amortized cost using the effective interest method. Financial liabilities at fair value through profit and loss includes financial liability held for trading and financial liability designated upon initial recognition as at fair value through profit and loss.

Ý Investment in Subsidiaries, Associates and Joint Ventures

Investment in equity shares of subsidiaries, associates and joint ventures is carried at cost in the standalone financial statements.

Ý Cash and cash equivalents

Cash and cash equivalents consist of cash, bank balances in currents and short-term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

b. Derivative Financial Instruments

Derivative instruments such as forward currency contracts are used to hedge foreign currency risks, and are initially recognized at their fair values on the date on which a derivative contract is entered into and are subsequently re-measured at fair value on each reporting date. A hedge of foreign currency risk of a firm commitment is accounted for as a fair value hedge. Any gains or losses arising from changes in the fair value of derivatives are taken directly to Statement of Profit and Loss. However, if hedging instrument hedges an equity instrument for which the Company has elected to present changes as at fair value through other comprehensive income, then fair value changes are recognized in Other Comprehensive Income.

Ý Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition as per Ind AS 109 . A financial liability (or a part of a financial liability) is derecognized from the company's balance sheet when the obligation specified in the contract is discharged or cancelled or expires.

Ý Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

Ý Reclassification of financial assets

The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The company's senior management determines change in the business model as a result of external or internal changes which are significant to the Company's operations. Such changes are evident to external parties. A change in the business model occurs when the company either begins or ceases to perform an activity that is significant to its operations. If the company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.

4. (A) Critical Accounting Estimates,Assumptions and Judgements

In the process of applying the company's accounting policies, management has made the following estimates, assumptions and judgements, which have significant effect on the amounts recognised in the financial statements:

(a) Property, plant and equipment

External advisor and/or internal technical team assess the remaining useful life and residual value of property, plant and equipment. Management believes that the assigned useful lives and residual values are reasonable, the estimates and assumptions made to determine depreciation are critical to the company's financial position and performance

(b) intangibles

I nternal technical and user team assess the remaining useful lives of Intangible assets. Management believes that assigned useful lives are reasonable. All Intangibles are carried at net book value on transition.

(c) Mine restoration obligation

I n determining the cost of the mine restoration obligation the Company uses technical estimates to determine the expected cost to restore the mines and the expected timing of these costs.

(d) Liquidated damages

Liquidated damages payable or receivable are estimated and recorded as per contractual terms/management assertion; estimate may vary from actuals as levy by customer/vendor.

(e) Leases

The company determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised.

(f) Other estimates

The Company estimates the un-collectability of accounts receivable by analyzing historical payment patterns, customer concentrations, customer credit-worthiness and current economic trends. If the financial condition of a customer deteriorates, additional allowances may be required. Similarly, as stated above the Company provides for other receivables / recovery against services, interest, etc. Also, the Company provides for inventory obsolescence, excess inventory and inventories with carrying values in excess of net realizable value based on assessment of the future demand, market conditions and specific inventory management initiatives. In all cases inventory is carried at the lower of historical cost and net realizable value.

4. (B) Other Accounting Policies

(a) Fair Value Measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non- financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy in which they fall.

(b) intangible assets

Capital expenditure on purchase and development of identifiable non-monetary assets without physical substance is recognized as Intangible Assets when:

• it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity; and

• the cost of the asset can be measured reliably.

Such Intangible assets are stated at cost less accumulated amortization and impairment losses, if any.

Intangible Assets are amortized on straight-line method over the expected duration ofbenefits. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at the end of each financial year. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the assets are considered to modify the amortization period or method, as appropriate, and are treated as changes in accounting estimates and adjusted prospectively.

Estimated useful lives of intangible assets are as follows:

• Computer software - 1 to 10 years

• Design & Drawings- 5 years

• Licenses - 25 years

(c) intangible assets under development

Mines development expenditure incurred in respect of new iron ore/coal and likewise mines are shown under 'Intangible assets under development'. On mines being ready for intended use, this amount is transferred to appropriate head under intangible assets

Development expenditure incurred on an individual project is recognized as an intangible asset when the Company can demonstrate all the following:

• The technical feasibility of completing the intangible asset so that it will be available for use or sale

• Its intention to complete the asset

• Its ability to use or sell the asset

• How the asset will generate future economic benefits

• The availability of adequate resources to complete the development and to use or sell the asset

• The ability to measure reliably the expenditure attributable to the intangible asset during development.

(d) Biological assets

Biological assets are measured at cost. Feeding and maintenance costs are expensed as incurred.

(e) investment property

Investment properties are measured at cost, including transaction costs less accumulated depreciation and impairment losses, if any.

(f) impairment

The carrying amount of Property, plant and equipment, Intangible assets and Investment property are reviewed at each Balance Sheet date to assess impairment, if any based on internal / external factors. An asset is treated as impaired when the carrying cost of asset or exceeds its recoverable value being higher of value in use and net selling price. An

impairment loss is recognized as an expense in the Statement of Profit & Loss in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed, if there has been an improvement in recoverable amount.

(g) Assets held for sale

Non-current assets are classified as "Held for Sale" if their carrying amount is intended to be recovered principally through sale rather than through continuing use. The condition for classification of "Held for Sale" is met when the non-current asset is available for sale. Non-current assets held for sale are measured at the lower of carrying amount and fair value less cost to sell.

(h) Leases

Right of Use Assets

The Company recognizes a right-of-use asset, on a lease-by-lease basis, to measure that right-of-use asset an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognised in the balance sheet immediately before the date of initial application.

The cost of right-of-use assets includes the amount of lease liabilities recognised. Initial direct costs incurred and lease payments made at or before the commencement date less any lease incentives received, the recognised right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of-use assets are subject to impairment test.

Lease Liabilities

The Company recognise a lease liability at the present value of the remaining lease payments, discounted using the lessee's incremental borrowing rate

The lease payments include fixed payments (including insubstance fixed payments) less any lease incentives receivable, variable lease payments that depend on a lease by lease basis

In calculating the present value of lease payments, the Company uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable.

Short-term Leases and leases of low-value assets

The company applies the short-term lease recognition exemption to its short-term leases (i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the lease of low-value assets recognition exemption to leases that are considered of low value. Lease payments on shortterm leases and leases of low-value assets are recognised as expense on a straight-line basis over the lease term.

(i) Borrowing Costs

Borrowing costs include interest and other costs that the Company incurs in connection with the borrowing of funds.

Borrowing costs related to a qualifying asset that necessarily takes a substantial period of time to get ready for its intended use is worked out on the basis of actual utilization of funds out of project specific loans and/or other borrowings to the extent identifiable with the qualifying asset and is capitalized with the cost of qualifying asset, using the effective interest method. All other borrowing costs are charged to statement of profit and loss.

I n case of significant long term loans, other costs incurred in connection with the borrowing of funds are amortized over the period of respective Loan.

(J) Inter-Division Transfers/Captive sales

• Inter-division transfer of independent marketable products, produced by various divisions and used for further production/sales is accounted for at approximate prevailing market price/other appropriate price.

• Captive sales are in regard to products produced by various divisions and used for capital projects. These are transferred at factory cost to manufacture.

• The value of inter-divisional transfer and captive sales is netted off from sales and corresponding cost under cost of materials consumed and total expenses respectively. The same is shown as a contra item in the statement of profit and loss.

• Any unrealized profit on unsold/unconsumed stocks is eliminated while valuing the inventories.

(k) Other Income

• Claims receivable

The quantum of accruals in respect of claims receivable such as from railways, insurance, electricity, customs, excise and the like are accounted for on accrual basis to the extent there is reasonable certainty of realization.

• Dividend Income from Investment

Dividend income from investments is recognised when the right to receive payment has been established.

• Interest Income

I nterest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is netted off from interest cost under the head "Interest Cost (Net)" in the statement of profit and loss.

(l) Research and Development expenditure

Revenue expenditure on research is expensed as incurred. Capital expenditure ( other than related to specific research activities ) incurred on research is added to the cost of Property, plant and equipment/ respective intangible asset.

(m) Earnings per share

Basic earnings per share is computed using the net profit/ (loss) for the year (without taking impact of OCI) attributable to the equity shareholders' and weighted average number of shares outstanding during the year. The weighted average numbers of shares is adjusted for treasury shares and also includes fixed number of equity shares that are issuable on conversion of compulsorily convertible preference shares, debentures or any other instrument, from the date consideration is received (generally the date of their issue)of such instruments. The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effect of potential dilutive equity shares unless impact is anti-dilutive.

(n) Segment Reporting

• Identification of Operating segments

The Company's operating businesses are organized and managed separately according to the nature of products manufactured and services provided, with each segment representing a strategic business unit that offers different products and as reviewed by the Chief operating decision maker of the Company.

• Inter-segment transfers

The Company recognises inter-segment sales and transfers as if they were to third parties at current market prices.

• Allocation of common costs

Common allocable costs are allocated to each segment on reasonable basis.

• Unallocated items

I t includes general administrative expenses, corporate & other office expenses, income that arises at the enterprise level and relate to enterprise as a whole being not allocable to any business segment and also un-allocable assets & liabilities that relate to the company as whole and not allocable to any segment.

• Segment Policies

The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the Company as a whole.

(o) Cash Flow Statement

Cash flow statement is prepared using the indirect method.

(f) (i) Employees Stock Option Scheme (JSPL ESOP Scheme-2017)

The Board of Directors in its meeting held on 8th August, 2017 approved the JSPL Employee Stock Option Plan 2017(JSPL ESOP Scheme-2017) and the same was approved by the shareholders in the Annual General Meeting held on 22nd September 2017, in accordance with SEBI (Share Based Employee Benefits) Regulations 2014.

Pursuant to the JSPL ESOP Scheme-2017, the Company may grant upto 4,50,00,000 options convertible into equal number of equity shares of T 1 each.

The Nomination and Remuneration Committee of the Board in its meeting held on 5th January, 2018 granted 51,21,735 options convertible into equal number of equity shares of the Company, to the eligible employees of the Company and its subsidiaries, at an exercise price of T 244.55 per option. As per JSPL ESOP Scheme-2017 the vesting period shall not be less than one year and maximum period will be three years. The employee shall exercise his options within a period of six months from respective vesting. 50,45,222 options have been surrendered/lapsed and balance outstanding as on 31st March 2021 was 76,513 options(vesting schedule is over and period of exercise is six month from respective vesting schedule). During the year ended 31st March 2022, the Company has allotted 72,126 equity shares at an exercise price of T 244.55 per share including premium of T 243.55 per share to the eligible employees of the Company and its subsidiaries, under JSPL ESOP Scheme - 2017 and balance outstanding is NIL option as on 31st March 2024.

(ii) Employee Stock Option Scheme/ Employee Share Purchase Scheme

The Board of Directors in its meeting held on 25th April,2013 and 9th August,2018 approved JSPL ESPS-2013 and JSPL ESPS-2018 respectively and the same were approved by the shareholders through Postal Ballot on June 21, 2013 and in the Annual General Meeting held on September 28, 2018 respectively, in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits ) Regulations, 2014.

Equity Shares/ grants as per JSPL ESPS-2013 and JSPL ESPS-2018 will be allotted in upcoming financial years.

(iii) In March 2022, the Company instituted the Jindal Steel & Power Employee Benefit Scheme - 2022 ("Scheme") to provide equity-based remuneration to all its eligible employees, including those of its Group Company(ies) including subsidiary or its Associate company(ies), in India or outside India or of a holding company, of the Company. The Scheme is administered by the Nomination and Remuneration Committee of the Board of Directors of the Company and is implemented through JSP Employee Benefit Trust ("Trust"). A maximum of 5,10,00,798 options may be granted under the Scheme. Each option granted under the Scheme entitles the holder to one fully paid up equity share of the Company at an exercise price, which will be decided by the Board of Directors.

Till March 31, 2024, the Trust had 1,76,60,427 nos. of equity shares (including 93,51,748 nos. acquired during FY 2021-22, 57,08,679 nos. acquired during FY 2022-23 and 26,00,000 nos. acquired during FY 2023-24). In terms of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SBEB Regulations") and post extension by Nomination and Remuneration Committee of the Company, the Company was required to allocate/ apportion 93,51,748 nos., of equity shares till March 31, 2024. In this regard, the Company requested SEBI, for extension of time for implementation of Scheme, in response to which SEBI has granted extension till July 31, 2024 to comply with SBEB Regulations for disposal of unappropriated inventory of shares not backed by ESOP grant(s) acquired by Trust in FY 2021-22. Under this extension, the Company has disposed of 31,06,341 nos. of equity shares till date (Refer note no. 66).

Notes:

I Term Loans from Banks

(i) Term Loans of ? 241.72 crores (March 31,2023 ? 1,368.00 crore) are secured as under

- First pari-passu charge over the immovable fixed assets (except immovable properties at Tensa mines, leasehold land having aggregate area of 551.49 acres at Patratu, Jharkhand and leasehold land having aggregate area of1,797.17 acres at Angul, Odisha), both present and future of the company and

- First pari-passu charge over all movable fixed assets of the company by way of hypothecation, both present and future and

- Second ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

Repayment schedule of these loans is as follows:

Loan of 2 84.08 crore has been repaid on 15th April, 2024.

Loans of 2 157.64 crores is repayable in 5 quarterly instalments and the next instalment is due on 30th June, 2024 and has been

prepaid in full subsequent to Balance sheet date on 23rd April, 2024.

(ii) Term Loans of ? Nil (March 31,2023 ? 664.98 crore) were secured as under

- First pari-passu charge over the immovable fixed assets (except immovable properties at Tensa mines, leasehold land having aggregate area of 551.49 acres at Patratu, Jharkhand and leasehold land having aggregate area of 1,811.85 acres at Angul, Odisha), both present and future of the company and

- First pari-passu charge over all movable fixed assets of the company by way of hypothecation, both present and future and

- Second ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

(iii) Term Loans of ? 3,422.95 crores (March 31, 2023 ? 3,690.91 crores) are secured as under:

- First pari-passu charge over entire immovable fixed assets (except leasehold land having aggregate area of 1,797.17 acres at Angul, Odisha) of the company situated at Angul, Odisha, both present and future of the company and

- First pari-passu charge over all movable fixed assets of the company situated at Angul, Odisha by way of hypothecation, both present and future and

- Second ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;"

Repayment schedule of these Term loans are as follows:

Loans of 2 3,422.95 crores is repayable in 22 quarterly instalments and the next instalment is due on 30th June, 2024.

(iv) Loans of ? NIL (March 31, 2023 ? 742.86 crores) were secured as under:

- First pari-passu charge over entire immovable fixed assets (except leasehold land having aggregate area of 1,797.17 acres at Angul, Odisha) of the company situated at Angul, Odisha , both present and future of the company and

- First pari-passu charge over all movable fixed assets of the company situated at Angul, Odisha by way of hypothecation, both present and future and

- Second ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

(v) Loans of ? NIL (March 31, 2023 ? 1,230.63 crores) were secured by way of:

- First pari-passu charge over the immovable fixed assets (except immovable properties at Tensa mines, leasehold land having aggregate area of 551.49 acres at Patratu, Jharkhand and leasehold properties having aggregate area of 1,811.85 acres at Angul, Odisha), both present and future of the company and

- First pari-passu charge over all movable fixed assets of the company by way of hypothecation, both present and future and

- First ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

(vi) Loans of ? NIL (March 31, 2023 ? 658.73 crores) were secured by way of:

- First pari-passu charge over the immovable fixed assets (except immovable properties at Tensa mines, leasehold land having aggregate area of 551.49 acres at Patratu, Jharkhand, leasehold properties having aggregate area of 1,797.17 acres at Angul, Odisha and leasehold properties having aggregate area of 57.042 hectares at Raigarh, Chhattisgarh), both present and future of the company and

- First pari-passu charge over all movable fixed assets of the company by way of hypothecation, both present and future and

- First ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

(vii) Loans of ? 2,457.57 crores (March 31, 2023 ? 1,352.4 crores ) are secured by way of:

- First pari-passu charge over entire immovable fixed assets (except leasehold land having aggregate area of 1,797.17 acres at Angul, Odisha) of the company situated at Angul, Odisha, both present and future of the company and

- First pari-passu charge over all movable fixed assets of the company situated at Angul, Odisha by way of hypothecation, both present and future and

- Second ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

- Additionally, term loan of 7 1,404.83 crore is also secured over first pari-passu mortgage over the newly allocated coal mines (i.e Utkal B1 & B2 and Utkal C coal mines in Odisha and Gare Palma IV/6 coal mine in Chhattisgarh), etc (Security over Utkal B1 & B2 coal mine is to be created).

Repayment schedule of these loans is as follows:

Loans of 4 2,457.57 crores is repayable in 22 quarterly instalments and the next instalment is due on 30th June, 2024.

(viii) Loans of ? 931.20 crores (March 31, 2023 ? Nil ) are secured by way of:

- First pari-passu charge over entire immovable fixed assets (except leasehold land having aggregate area of 1,797.17 acres at Angul, Odisha) of the company situated at Angul, Odisha, both present and future of the company (Security to be created)

- First pari-passu charge over all movable fixed assets of the company situated at Angul, Odisha by way of hypothecation, both present and future and

- Second ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

- First pari-passu mortgage over the newly allocated coal mines (i.e Utkal B1 & B2 and Utkal C coal mines in Odisha and Gare Palma IV/6 coal mine in Chhattisgarh), etc (Security to be created)

Repayment schedule of this Term loan is as follows:

Loans of 7 931.20 crores is repayable in 22 quarterly instalments and the next instalment is due on 30th June, 2024.

(ix) Loans of ? 462.69 crores (March 31, 2023 ? Nil) are secured (created/to be created) by way of:

- First ranking pari-passu mortgage over entire immovable assets (including freehold and leasehold aggregate area of approx. 249 acres of land at Barbil Plant, Odisha) of the company situated at Barbil Odisha, both present and future of the company (Security to be created) and

- First ranking pari-passu charge by way of hypothecation over all movable fixed assets of the company situated at Barbil, Odisha, both present and future of the company

I Cash Credit from Banks and Buyer's Credit

The working capital facility mentioned in 26 (i) & 26 (ii) of T 2,602.47 crores (March 31, 2023 T 1,454.82 crores) are secured by way of

- Second pari-passu charge over entire immovable fixed assets (except leasehold land having aggregate area of 1,797.17 acres at Angul, Odisha) of the company situated at Angul, Odisha, both present and future of the company and

- Second pari-passu charge over all movable fixed assets of the company situated at Angul, Odisha by way of hypothecation, both present and future and

- First ranking pari-passu charge by way of hypothecation over all the current assets, both present and future, of the company;

II Rate of Interest

The Weighted average rate of interest for Cash credit outstanding as on 31st March, 2024 is 7.38% p.a The Weighted average rate of interest for Buyer's Credit outstanding as on 31st March, 2024 is 5.76% p.a.

The Weighted average rate of interest for loan from related parties as at 31st March 2024 is 8.00% p.a.

@ Notes

(i) (a) During the previous year, the Company had received show cause notices followed by Demand notices from Joint Director of Mines, in relation to its mining operations at Kasia Iron & Dolomite Block, Odisha, alleging loss of royalty and other levies aggregating to T 442.65 crores inter-alia alleging shortfall in despatch for the period from November 20, 2021 to February 19, 2022, visa a vis minimum dispatch required as per Mine Development and Production Agreement (MDPA). The Company has contested the said demand by filing revision applications before Revisional Authority, Ministry of Mines, Government of India, since the Company couldn't commence mining activities as a group of people approached the subject Mine and illegally and unlawfully obstructed the entry of employees and machinery, demanding unreasonable rates for transportation. Also in this regard, the Company had approached Hon'ble High Court of Odisha in December 2021 praying for their direction to concerned parties to take necessary steps to remove illegal blockade from and around the Mining area and shift the assessment date under the MDPA for the above stated period and Hon'ble High Court was pleased to issue notice on the matter. The Company has evaluated the matter and concluded that the outflow of resources is remote and accordingly, no provision is made in this regard.

(b) During the year, the company has received two demand notices from Deputy Director of Mines, Joda in relation to its mining operations at Kasia, Iron & Dolomite block, Odisha alleging for loss of royalty, mining premium etc. aggregating to T 297.06 crores for dispatch of iron ore without taking permission from competent authority and for dispatching 10-25mm CLO as 10-40 mm CLO. The company believes that the mining operations are being carried out in compliance with the extent mining laws, regulations and as

per the mining lease agreement signed by the Company, the company has contested the said demands by filing revision applications before the Revisional Authority, Ministry of Mines, Government of India. The company has evaluated the matter and concluded that the outflow of resources is remote based on facts available on records and in the opinion of the management has creditable case in its favour, accordingly no provision is made in this regard.

(ii) The Directorate of Enforcement had passed a Provisional Attachment order in earlier year to attach fixed deposits of T 60 crore. [to the extent of T 58.01 crore with interest accrued as on date of taking possession after confirmation of this order] in relation to the alleged excess mining from Gare Palma IV/1 which was granted to Jindal Steel & Power (the Company). The Company has filed a Writ Petition challenging the said Provisional Attachment order and the Hon'ble High Court of Delhi had stayed the proceedings before the Adjudicating Authority. Further the Company had paid the royalty amount as per the applicable rates, in terms of the lease agreement and had also filed returns with the authorities in time. Further, in the opinion of the company also the attachment is bad in law as attachment pertains to alleged unauthorized mining which is not a Scheduled Offence under the PMLA. Based on above and as per the advise of an expert the management believes that it has a creditable case in its favour.

(iii) During the previous year, the Company has received Order of Seizure dated March 24, 2023 from Assistant Director, Directorate of Enforcement, (Prevention of Money Laundering Act 2002 & Foreign Exchange Management Act, 1999) alleging contravention of provisions of FEMA on account of non-repatriation of foreign exchange (held outside India) to India and during the year, the authority has attached Bank fixed deposits of T 109.55 crores. In this regard, Company has filed appeal with Appellant Tribunal under Foreign Exchange Management Act, 1999 and management believes that it has a creditable case in its favour and there will be no material impact of this on standalone financial statement.

b) Non-Current Assets

All non-current assets other than financial instruments of the company are located in India.

c) information about Major Customers

No customer individually accounted for more than 10% of the revenue.

46. a) Pursuant to the Judgment dated 25.08.2014 read with Order dated 24.09.2014 passed by the Hon'ble Supreme Court for the deallocation of the coal blocks, Gare Palma IV/1 (Operational); Utkal B-1 (Non-operational), Amarkonda Murgadangal (Nonoperational), Gare Palma IV/6 (under JV) (Non-operational), Ramchandi (Non-operational), Urtan North (under JV) (Nonoperational) and Jitpur (Non-operational) which were allocated to the company/JV stands deallocated. Prior to the said deallocation by the Hon'ble Supreme Court, the Government had invoked bank guarantees provided by the Company to the extent of T 155.82 crore with respect to Ramchandi, Amarkonda Murgadangal, Urtan north and Jitpur Coal Blocks. These matters were contested by the Company at various levels and the invocation of the said bank guarantees had been stayed by the respective Hon'ble High Courts. The Bank guarantees amounting to T 155.82 crore were earlier provided by the Company and kept alive for the above-mentioned four non- operational coal blocks. During the FY 2021-22, MoC had returned the Bank Guarantee of Jitpur coal block amounting T 16.59 crore while the BG matters pertaining to Ramchandi, Amarkonda Murgadangal and Urtan north coal blocks were deliberated before the Inter-Ministerial Group (IMG) and subsequently based on their recommendation, the Office of the Coal Controller has returned the bank guarantees of T 139.23 crore in addition to the BG amount of Jitpur Coal Block. Hence, the BG amounting to T 155.82 crore has been released and returned by the competent authority.

b) During the earlier year, the Company has also won in the auction held for the coal blocks at Utkal C, Utkal B1 and Utkal B2 in the State of Odisha; and the Gare Palma IV/6 mine in the state of Chattisgarh. During the year out of the above mines, Company has executed the mining leases in favour of Utkal C, Utkal B1 and Gare Palma IV/6 coal mines and has started the coal production from Gare Palma IV/6 and Utkal C coal mines with coal production of about 1.80 MT and 1.03 MT respectively.

d) Securities given

i) Rupee Term Loan facility of T 15,727 crores availed by JSO is secured by way of Corporate Guarantee from the Company and by way of Pledge of 14,09,88,477 nos. of equity shares of T 10 each fully paid up and 36,89,88,000 nos. of preference shares of T 10 each fully paid up of JSO held by JSP. Outstanding as at 31st March 2024 is T 7,761.83 crores (previous year T NIL). Further, the Capex LC facility of T 4,000 crore sanctioned to JSO is closed and subsumed under Rupee Term Facility of T 15,727 crore sanctioned to JSO

ii) During the year, Rupee Short term Loan facility of T 500 crores availed by JSO is secured by way of Corporate Guarantee from the company. Outstanding as at 31st March 2024 is T Nil.

iii) Capex LC facility of T 250 crores (previous year T 2,150 crores) availed by JSO is secured by way of Corporate Guarantee from the company, amount outstanding as on 31st March 2024 is T 180.67 crores (previous year T 489.40 crores)

iv) Rupee Term Loan facility of T 2,376 crores and Performance Bank Guarantee of T 478.43 crores (previous year T Nil ) availed by Jindal Paradip Port Limited (JPPL) is secured by way of Corporate Guarantee from the company and by way of pledge of 88,24,930 nos. of equity shares of T 10 each fully paid up and NDU for 61,77,451 nos. of equity shares of T 10 each fully paid up out of total 5,76,30,000 nos. of equity shares of T 10 each fully paid up of JPPL held by JSP. Outstanding as at 31st March 2024 is T 478.43 crores (previous year T Nil )

v) Non-fund based credit faciity of T 249.44 crore (AUD 45.80 million) availed by step down wholly owned subsidiary Wollongong Resources PTY Ltd, Wongawalli Resources PTY Ltd is secured by the way of corporate guarantee from the company, amount outstanding as on 31st March 2024 is T 249.44 crore (previous year T 254.41 crore).

49. The Company has investment of T 575.73 crores and also loan of T 5,523.32 crores (net off written off / provision of T 7,575.35 crores) in its wholly owned subsidiary, Jindal Steel & Power (Mauritius) Limited (""JSPML"") as on March 31, 2024. JSPML has been incurring losses. JSPML in turn has investments in step-down subsidiaries (incorporated in various countries) which are operating mainly in mining activities. JSPML and certain subsidiaries (mainly incorporated in Australia) has been incurring losses over the years. Accordingly, after taking into consideration the report of experts, the Company had made full loss allowance against investment made in share capital of T 575.73 crores and also made loss allowance on loan & interest receivable of T 8,340.80 crores (including loss allowance against Interest receivable of T 765.45 crores and against exchange fluctuation of T 898.48 crore) against outstanding in the account of JSPML in the year ended March 31, 2023. During, the current year based on the opinion of experts and considering the present market conditions an amount of T 7,776.51 crores of loan / outstanding amount given to JSPML (represents Loan T 6,112.58 crore, Interest Receivable of T 765.45 crore & Forex of T 898.48 crore) has been written off out of the provision (made in the year ended March 31, 2023) carried over.As on March 31, 2024 the accumulated losses and negative net worth of JSPML is of T 3,466.69 crores and T 2,068.70 crores respectively and auditors of JSPML have drawn attention in their audit report on "Going Concern Basis” issue. The auditors of JSPML has not modified their opinion on this. The management of JSPML considered the entity (JSPML) to be going concern as on March 31, 2024 on the basis that JSPML has the continued support of the company until such time as it is able to function on a financially independent basis. Considering the facts stated above, based on assessment carried out by an independent valuer and as assessed by the management no additional provision is required to be made during the year against the balance outstanding loan in the account of JSPML of T 5,523.32 crores and same is considered good and fully realisable by the Company.

Financial guarantees issued by the company on behalf of its subsidiary companies have been measured at fair value through profit and loss account. Fair value of said guarantees as at March 31, 2024 is T Nil (March 31, 2023 T Nil) have been considered by the management on the basis of valuation carried out by an independent professional.

Fair valuation techniques

The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used to estimate the fair values:

1) Fair value of cash and deposits, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

2) Long-term fixed-rate and variable-rate receivables / borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk factors, credit risk and other risk characteristics. Fair value of variable interest rate borrowings approximates their carrying values. For fixed interest rate borrowing fair value is determined by using the discounted cash flow (DCF) method using discount rate that reflects the issuer's borrowings rate. Risk of non-performance of the Company is considered to be insignificant in valuation.

3) The fair values of derivatives are estimated by using pricing models, where the inputs to those models are based on readily observable market parameters basis contractual terms, period to maturity, and market parameters such as interest rates, foreign exchange rates, and volatility. These models do not contain a high level of subjectivity as the valuation techniques used do not require significant judgement, and inputs thereto are readily observable from actively quoted market prices. Management has evaluated the credit and non-performance risks associated with its derivative counterparties and believe them to be insignificant and not warranting a credit adjustment.

The Company's principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to manage finances for the Company's operations and project. The Company's financial assets comprise investments, loan and other receivables, trade and other receivables, cash, and deposits that arise directly from its operations.

The Company's activities are exposed to market risk, credit risk and liquidity risk. In order to minimise adverse effects on the financial performance of the Company, derivative financial instruments such as forward contracts are entered into to hedge foreign currency risk exposure. Derivatives are used exclusively for hedging purposes and not as trading and speculative purpose. Further, this to be read with note 50a.

I. Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices as well as conditions. Market prices comprise three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits, investments, and derivative financial instruments.

The sensitivity analysis in the following sections relate to the position as at 31st March 2024 and 31st March 2023.

The analysis exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions. The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. The Company uses derivative financial instruments such as foreign exchange forward contracts of varying maturity depending upon the underlying contract and risk management strategy to manage its exposures to foreign exchange fluctuations.

(a) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. In order to optimize the Company's position with regard to interest income and interest expenses and to manage the interest rate risk, the Company performs a comprehensive corporate interest rate risk management by balancing the proportion of the fixed rate and floating rate financial instruments in its total portfolio.

(b) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company transacts business primarily in Indian Rupees and US dollars. The Company has obtained foreign currency loans and has foreign currency trade payables and receivables and is therefore exposed to foreign exchange risk. Certain transactions of the Company act as a natural hedge as a portion of both assets and liabilities are denominated in similar foreign currencies. For the remaining exposure to foreign exchange risk the Company adopts a policy of selective hedging based on risk perception of the management. Foreign exchange contracts are carried at fair value.

The Company hedges its exposure to fluctuations by using foreign currency forwards contracts on the basis of risk perception of the management.

(c) Commodity Price Risk

Commodity Price Risk is the risk that future cash flows of the Company will fluctuation on account of changes in market price of key raw materials.

The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations. The Company enters into contracts for procurement of materials, most of the transactions are short term fixed price contract and a few transactions are long term fixed price contracts.

II. Credit risk

Credit risk arises from the possibility that the counterparty will default on its contractual obligations resulting in financial loss to the Company. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial conditions, current economic trends, and analysis of historical bad debts and ageing of accounts receivable.

The Company considers the probability of default upon initial recognition of assets and whether there has been a significant increase in credit risk on an ongoing basis through each reporting period. To assess whether there is significant increase in credit risk, it considers reasonable and supportive forward looking information such as:

(i) Actual or expected significant adverse changes in business.

(ii) Actual or expected significant changes in the operating results of the counterparty.

(iii) Financial or economic conditions that are expected to cause a significant change to the counterparty's ability to meet its obligation.

(iv) Significant increase in credit risk and other financial instruments of the same counterparty.

(v) Significant changes in the value of collateral supporting the obligation or in the quality of third party guarantees or credit enhancements.

The Company makes provision against credit impairment of trade receivable based on expected credit loss (ECL) model.

The ageing analysis of the trade receivables (gross) has been considered from the date the invoice falls due:

During the year, the testing did not result in any impairment in the carrying amount of assets.

The measurement of the cash generating units' value in use is determined based on financial plans that have been used by management for internal purposes. The planning horizon reflects the assumptions for short to- mid term market conditions.

Key assumptions used in value-in-use calculations:

• Operating margins (Earnings before interest and taxes)

• Discount Rate

• Growth Rates

• Capital expenditures

Operating margins: Operating margins have been estimated based on past experience after considering incremental revenue arising out of adoption of valued added and data services from the existing and new customers, though these benefits are partially offset by decline in tariffs in a hyper competitive scenario. Margins will be positively impacted from the efficiencies and initiatives driven by the Company; at the same time, factors like higher churn, increased cost of operations may impact the margins negatively.

Discount rate: Discount rate reflects the current market assessment of the risks specific to a CGU or group of CGUs. The discount rate is estimated based on the weighted average cost of capital for respective CGU or group of CGUs.

Growth rates: The growth rates used are in line with the long term average growth rates of the respective industry and country in which the Company operates and are consistent with the forecasts included in the industry reports.

Capital expenditures: The cash flow forecasts of capital expenditure are based on past experience coupled with additional capital expenditure required.

56. Assets held for sale

The Company has identified certain assets for disposal. The management is in discussions with potential buyers. Based on preliminary discussions with potential buyers/ external valuation, the carrying value of these assets has been considered as fair value :-

61. The Code on Social Security, 2020 ('Code') has been notified in the Official Gazette in September 2020 which could impact the contribution by the Company towards certain employment benefits. The effective date from which the changes and rules would become applicable is yet to be notified. Impact of the changes will be assessed and accounted in the relevant period of notification of relevant provisions.

62. Balances of certain advances, creditors (including MSME) and receivables are in process of confirmation/reconciliation. Management believe that on reconciliation/ confirmation there will not be any material impact on statement of financial statements.

63. Information related to Consolidated financial

The company is listed on stock exchanges in India, the Company has prepared consolidated financial as required under IND AS 110, Sections 129 of Companies Act, 2013 and as per the listing requirements. The consolidated financial statement is available on company's web site for public use.

64. Other statutory information

a) The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any benami property.

b) The Company has not traded or invested in Crypto currency or Virtual currency during the financial year.

c) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (intermediaries) with the understanding that the intermediary shall:

(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (ultimate beneficiaries) or

(ii) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

d) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(i) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

(ii) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

e) The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

f) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017

g) The Company is not declared wilful defaulter by and bank or financial institution or lender during the year.

h) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period except the charges yet to be created as stated in footnotes to note no. 22

i) Quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts.

j) The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was obtained.

k) The title deeds of all the immovable properties, (other than immovable properties where the Company as the lessee and the lease agreements are duly executed in favour of the Company) disclosed in the financial statements included in property, plant and equipment and capital work-in progress are held in the name of the Company as at the balance sheet date except as stated in footnote no 2 of note no.5.

66. As at March 31, 2024, Interest free loan of T 850 crores (March 31, 2023 T 850 crores) to JSP Employee Benefit Trust ("the Trust') is for the purpose of employee benefit scheme. The trust utilised its proceeds of the loan received from the company for purchase of the companies own shares (refer note no. 20 (f) (iii)) and balance being amount had been invested in Mutual fund by the trust. The company considers the Trust as an extension of the entity and hence has incorporated the assets and liabilities of the Trust in the standalone financial statements of the company. The shares of the company held by the trust are shown under 'Treasury shares held through ESOP Trust' in share capital and difference of consideration paid and face value of own shares purchased from secondary market is shown under ' Consolidation of JSP Employee Benefit Trust' and adjusted through Retained Earnings.

67. Previous year figures have been regrouped/ rearranged, wherever considered necessary to conform to current year's classification. Figures less than 50000 have been shown as absolute number.

68. Notes 1 to 68 are annexed to and form an integral part of standalone financial statements.

As per our report of even date For & on behalf of the Board of Directors

For Lodha & Co LLP Sabyasachi Bandyopadhyay Damodar Mittal

Chartered Accountants Whole Time Director Whole Time Director

Firm Registration No. 301051E/E300284 DIN: 10087103 DIN: 00171650

Gaurav Lodha Sunil Agrawal Anoop Singh Juneja

Partner Chief Financial Officer Company Secretary & Compliance Officer

Membership No. 507462 Membership No. F6383

Place: New Delhi

Dated: 13th May, 2024